HomeMy WebLinkAboutReso 2017-009RESOLUTION NO. 2017-009
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
CHULA VISTA AMENDING THE ECONOMIC
DEVELOPMENT DEPARTMENT'S FISCAL YEAR 2016/2017
BUDGET BY APPROPRIATING $200,000 FOR BUSINESS
ATTRACTION AND RETENTION INITIATIVES
WHEREAS, enterprise zones, created pursuant to and governed by California
Government Code sections 7070-7089 (Enterprise Zone Act), were geographical areas located
throughout California designed and authorized for the purpose of stimulating business and
industrial growth in economically underinvested areas by relaxing regulatory controls that
impede private investment; and
WHEREAS, pursuant to the Enterprise Zone Act, the Enterprise Zone Program (EZ
Program) provided state sales and use tax credits, business expense deductions, and employee
hiring tax credits (Hiring Tax Credit), as well as local incentives comprised of regulatory, tax,
program, and other incentives, to attract private sector investment to each enterprise zone; and
WHEREAS, the California Department of Housing and Community Development (HCD)
was authorized to designate new enterprise zones and provide administrative oversight of the EZ
Program to existing enterprise zones; and
WHEREAS, on November 3, 2006, HCD awarded designation of the San Diego
Regional Enterprise Zone (Former SDREZ), a multi jurisdictional, regional enterprise zone
comprised of geographical areas within the cities of Chula Vista, San Diego, and National City;
and
WHEREAS, the cities of Chula Vista, San Diego, and National City (collectively,
SDREZ Original Partners) entered into a memorandum of understanding establishing the
partnership framework necessary to create the Former SDREZ and establishing the City of'San
Diego as the zone administrator (Administrator); and
WHEREAS, in order to receive the Hiring Tax Credit under the Enterprise Zone
Program, an eligible business applied for the credit by submitting a California Enterprise Zone
Hiring Tax Credit Voucher Application (Voucher Application) to its zone administrator and,
upon verification of eligibility, the zone administrator issued a Hiring Tax Credit Voucher
Certificate (Voucher Certificate) for the business to submit with its income tax filing; and
WHEREAS, the Administrator of the Former SDREZ was required to process all Former
SDREZ Voucher Applications and issue Voucher Certificates (Voucher Program); and
WHEREAS, the Administrator of the Former SDREZ charged a fee of $100 for each
Voucher Application processed, as permissible under article XI, section 7 of the California
Constitution, to offset state and local administrative costs associated with administering the
Voucher Program: and
Resolution No. 2017-009
Page No. 2
WHEREAS, the Enterprise Zone Act was repealed as of January 1, 2014, pursuant to
California Assembly Bill 93 (AB 93), resulting in the premature termination of all enterprise
zones, but allowing qualifying businesses in former enterprise zones to continue to take
advantage of the Hiring Tax Credit if issued a Voucher Certificate by a zone administrator
during calendar year 2014; and
WHEREAS, the Administrator elected to continue accepting Voucher Applications from
qualifying businesses in the Former SDREZ through October 1, 2014, resulting in additional
funds paid to the City of San Diego; and
WHEREAS, the residual funds associated with the Former SDREZ (SDREZ Funds),
generated from administration of the Voucher Program, total $3,503,533.52; and
WHEREAS, on January 13, 2016, the City of San Diego disbursed residual SDREZ
Funds to the City of Chula Vista in an amount of $486,991.16 which is equal to the percentage of
Hiring Credit Voucher Certificate applications received from qualifying businesses in Chula
Vista; and
WHEREAS, the SDREZ Funds can be used to further the City's goal to support the
Economic Development Department in its pursuit to develop certain economic development
initiatives, including strategic opportunities with long term economic growth benefit potential,
and to complement regional economic development goals of the City's Economic Development
Strategy; and
WHEREAS, the City wishes to allocate a portion of the SDREZ funds to develop a
Revolving Loan Fund for business attraction and retention efforts focused on Third Avenue and
Main Street.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Chula
Vista, that it appropriates $200,000 to the Other Expenses Category of the Fiscal Year 2016/2017
budget of the Economic Development Department for business attraction and retention initiatives
to be off -set by unanticipated revenues.
Presented by
!� �//
Eric C. Crockett
Director of Economic Development
Approved as to form by
G en R. G ogins
Ci A ey
Resolution No. 2017-009
Page No. 3
PASSED, APPROVED, and ADOPTED by the City Council of the City of Chula Vista,
California, this 10th day of January 2017 by the following vote:
AYES: Councilmembers: Aguilar, Diaz, McCann, Padilla; and Salas
NAYS: Councilmembers: None
ABSENT: Councilmembers: None
Mary S as, Mayor
ATTEST:
Donna R. Norris, C C, City derk
STATE OF CALIFORNIA
COUNTY OF SAN DIEGO
CITY OF CHULA VISTA
I, Donna R. Norris, City Clerk of Chula Vista, California, do hereby certify that the foregoing
Resolution No. 2017-009 was duly passed, approved, and adopted by the City Council at a
regular meeting of the Chula Vista City Council held on the 10th day of January 2017.
Executed this 10th day of January 2017.
Donna R. Norris, CMC, City Clerk