Council Action Requested:
Approve the reduction in number of employees to be maintained from 63 to 40, on-site while authorizing a corresponding reduction in the amount of Special Source Revenue Credit offered from 58% to 40%, while requiring 40 on-site individuals as the minimum number of employees required to receive the SSRCs. All other terms to remain unchanged, including the company commitment to invest $2,500,000 during the investment period which runs for five years to 2027.
Points to Consider:
Project Cobalt is an existing company in Lancaster County. Part of a group that has been operating for nearly 100 years, it has operated in the County for over two decades and has consistently participated in philanthropic missions in Lancaster County. The company manufactures geo-membranes made from a diversity of proprietary polymer Chemistry formulas powered through state-of-the-art polymer extrusion equipment.
The company has not been about to reach and maintain it agreed to employment numbers, as outlined in the economic development agreement. They are close, but do not foresee that they will be able to maintain the 63-employee threshold that was established in the agreement.
Given this situation, they have agreed to a 18% reduction in the SSRC percentage to recognize they have not satisfied the employee requirement.
They are on track to satisfy the other components of the economic development agreement.
Funding and Liability Factors:
The County will receive additional net taxes over the life of the FILOT Agreement based upon this percentage change from the original agreement. (SSRCs reduced from 58% to 40%).
Recommendation:
Staff recommends to proceed with three readings and conclude with approval of this Economic Development Incentive amendment request.