LB840 goes before Grand Island voters for renewal this year.
The Local Option Municipal Economic Development Act is the primary incentive offered by Grand Island Area Economic Development Corporation and uses sales tax dollars to provide direct cash payments to local companies.
With its renewal, two new areas of local development are being proposed by the city for businesses to qualify for the funds.
To qualify, businesses must be involved in these areas: manufacturing articles of commerce; conducting research and development; processing, storing, transporting or sale of goods or commodities sold or traded in interstate commerce; sales of services in interstate commerce; headquarter facilities relating to such activities; telecommunications activities; tourism-related activities; and production of films.
The Nebraska Legislature approved two new areas this year: Construction or rehabilitation of housing; and early childhood care and education programs.
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“We listen to our business partners. Workforce, housing and childcare. Those are true needs,” said Dave Taylor, GIAEDC President at a Grand Island City Council work session Tuesday. “To continue to grow, we think it’s imperative for our community that we have these in place so we can continue to recruit people, places and things for Grand Island.”
GIAEDC did not include retail as a new qualifying business, though it was also approved by the Legislature this year. The GIAEDC board believes that sector will “take care of itself,” Taylor said.
Council Member Mitch Nickerson said the focus of housing over creating jobs gives him “heartburn.
“If we cut off potential folks who want to come in because we’re now focusing on housing, we are losing potential jobs,” he said Tuesday. “We have a place for the employees to live, but we don’t have a business to bring employees in. It’s going to be a balancing act.”
A draft version of the LB840 renewal plan was presented to council members and discussed during the work session.
According to statute, a public hearing will be held on the renewal plan on May 10, said Jerry Janulewicz, city administrator.
“On May 10 we would also ask the council to adopt a resolution approving the program and directing placement of the question on the ballot for the November 2022 election,” he said. “If that is a favorable vote from the public, the city council would be asked to adopt an ordinance establishing the plan for the next 10 years.”
LB840 was adopted by Legislature in 1991 and adopted in Grand Island in 2002. The first 10-year plan took effect in 2003. It was renewed by voters in 2012 for an additional 10 years, and is set to expire on Sept. 30, 2023.
Decisions about the funds are overseen by the Citizens Advisory Review Committee.
The fund has a current balance of about $1.8 million, Taylor said, with investments going to Amur Equipment Finance, Zabuni Specialty Coffee, GIX Logistics and Hornady Manufacturing, among others.
With the renewal, Taylor asked council to dedicate $950,000 annually to the program. It’s an increase from the current $750,000 annual commitment. Of the proposed amount, $525,000 would go into incentives for recruiting businesses, and $425,000 would go toward operations.
“We anticipate using that for community betterment, our housing, marketing of Grand Island and our entrepreneurial outreach that we’re pushing forward with from a sophomore level in high school up to adults,” said Taylor.
Beth Frerichs, of the Committee for a Prosperous Grand Island, which supports the GIAEDC, advocated for renewing LB840 to help support business development in Grand Island.
“These funds are critical to how we continue to develop and attract new businesses, which then also attracts new talent to our area,” she said. “Without these funds, with our neighboring communities having these resources, we will likely be left behind and there will be a hole in our community we won’t be able to fill easily.”
A public hearing on LB840 will be held during the regular Grand Island City Council meeting on Tuesday, May 10, at 7 p.m., at 100 E. First St. in Grand Island.