1. Safeguards and Performance Standards for Economic Development
2015 Annual Conference October 9, :00 A.M. – 10:00 A.M. General Session
Safeguards and Performance Standards for Economic Development

2. Safeguards and Performance Standards for Economic Development
Dane Lee
Springsted

3. The “Funk”

4. Safeguards and Performance Standards for Economic Development
Jackie Maloney
Spencer Fane
David Bushek
Gilmore & Bell
Richard
Wood
Gilmore & Bell

5. What does the City want from the deal?
Size and scope of project
Type of incentive requested
$$ amount of incentive requested
Developer performance

6. Primary Issues In Negotiations
Developer wants to deliver a finished project
Municipality wants results
Increased sales
Increased property values
Increased jobs, retained jobs
High wages
Staff discussions vs Developer expectations; later legislative approvals

7. Performance Standards – Incentivizing Performance
Conditions to Unlocking Reimbursement
Phased Reimbursement
Hold-back Requirement
Conditions of Debt Issuance
Reimbursement of Private Interest Costs

8. Performance Standards – Penalizing Non-Performance
Clawbacks
Penalties
Rescission

9. Performance Standards – Adjusting Reimbursement to Project Benefits
Limits on Developer Profit
Reimbursement True-Up – Public/Private Ratio

10. Safeguards – Compliance with Legal Requirements
Prevailing Wages
Competitive Bidding
Release of Liens
Performance and Payment Bonds

11. Safeguards – Protections after the Project is Built
Developer, sub-developer or tenant construction of project improvements
Restrictions on transfer of property
Restrictions on changes to developer

12. Safeguards – Protections after the Project is Built
Municipal review of private covenants
Prohibition on Business Relocation
Land Use Restrictions
Approved Tenant List

13. Safeguards and Performance Standards – General Recommendations
Anticipate problems
Clarity – be specific in contracts
Avoid later disputes
Anticipate restructuring and work-out scenarios
Who provides later municipal approvals