MEMORANDUM
TO:
Kelly Setzer, Corporate Communications
FROM:
Brad Richardson, Economic Development Manager
DATE:
September 26, 2013
RE:
Business Investment Program Report (FY12 & FY13)
The Business Investment Program was created in 1998 in partnership with Mecklenburg County to
encourage the creation, retention and/or expansion of new or existing businesses and jobs in identified
investment zones within the community. The program provides grants, paid over multiple years, based
upon the amount of new property tax generated by the business. Businesses are required to meet and
maintain thresholds for capital investment, new jobs and wages throughout the term of the grant. BIP
grants are often used to provide a match to State incentives.
Council policy includes provisions that no payments will be made unless investment and hiring targets
are met, as well as provisions that obligate a business to repay a portion of the grant if it removes its
investment from Charlotte within a certain period of time after the end of the grant term.
As illustrated in the attached Activity Report, the City has approved fifty (50) BIP grants since the
program began. Of these, twenty-seven (27) are currently active; eight (8) are complete; and fifteen (15)
have been withdrawn for non-compliance.
Please find attached the following two documents:
1) Activity Report, highlighting payments made in F12 and FY13.
2) BIP Policy (updated December, 2012).
Please contact me if you have additional questions at 704-336-3857.
Working to make Charlotte neighborhoods and businesses healthy and vibrant
600 E. Trade Street • Charlotte, NC • 28202• 704-336-3380
www.CharlotteNC.gov
Charlotte-Mecklenburg
Business Investment Program
What is the Business Investment Program (BIP)?
The Business Investment Program (BIP) seeks to encourage the creation, retention and/or expansion of new
or existing businesses and jobs in identified Investment Zones within the community. The program provides
grants to companies based upon the amount of property tax generated by the private business investment
made. The program aligns itself with local Smart Growth, Transit, and the Business Corridor Revitalization
Strategic Plans.
Criteria for Evaluating Projects
In making a recommendation for grant approval, the City will consider whether there is demonstrated
competition from other cities and whether the company’s planned relocation or expansion is a realistic choice
given the company’s product and market. Criteria will include a certification by company executives that the
relocation or expansion is contingent upon receiving local incentives.
Grant recipients will be encouraged to hire residents of Mecklenburg County and to use local small, minority
and women owned businesses when such goods or services can be obtained at competitive prices.
Eligible Business Growth Clusters
Companies from the identified business growth clusters that are relocating or expanding to or within the
program’s geography may be eligible for participation in the program See Attachment I for a list of eligible
business growth clusters.
Eligible Geography
Companies locating in the adopted Business Investment Zone (see Attachment II) will be eligible for
participation in the program. The adopted zone includes the following areas:
Center City
Business Corridor Revitalization Geography
Transit Station Areas1
Arrowood-Westinghouse Industrial Area2
University Research Park
Coliseum/Tyvola Road Area
Additional locations that are consistent with adopted land use policies and plans may also be considered, as
well as projects that meet the program’s definition of a “Large Economic Impact Project” as defined below.
Grants may also be considered for projects that convert or adaptively reuse vacant “Big Box” retail sites,
whether inside or outside the development zone, provided that the planned use is consistent with adopted
plans for that area.
1
If an adopted Station Area Plan does not exist, the development zones will extend ¼ mile from transit stations identified
in the Major Investment Study.
2
Transportation/Distribution and Manufacturing projects only.
Revised December 2012
Charlotte-Mecklenburg Business Investment Program
Program Guidelines and Requirements
Investment
$3 million
Investment is broadly defined as improvements to land and/or buildings, or the
purchase or lease of new equipment, or buildings constructed for the qualifying
company. Where circumstances warrant, however, Grant calculations may give
consideration to the value of leasehold improvements in existing buildings when it
can be reasonably demonstrated that the lease will cause additional investment to
replace the leased space, or that the lease results in a higher value for the building.
Job Creation
20 new jobs; however, manufacturers creating less than 20 new jobs, but at least
10 may be considered for the program with a minimum investment of $6 million
within the Investment Zone.
Wage Rate
Grant recipients must pay an average wage rate for all employees at the investment
site equal to or greater than 100% of the average annual wage rate for the
Charlotte-Gastonia-Rock Hill M.S.A.
Should the projected annual average wage rate be less than the M.S.A. average,
the City and County may consider the industry-specific annual average wage rate in
making a determination regarding eligibility.
The required average annual wage rate may be lowered by up to 20% for those
companies that pledge to employ Work First participants and/or residents of the
development zone itself in 25% or more of the new job positions.
Terms and Amounts
Grants last for three years and are based upon 90% of new property taxes
generated by the investment.
Existing businesses within Mecklenburg County are eligible for an additional two
year term.
Clawback Provisions
Required investment and employment standards will be set forth in a contractual
agreement between the City, County and Grantee. These standards must be
maintained throughout the term of the Grant in order for payments to continue.
Failure to maintain these levels during the Grant term will result in suspension of
Grant payments until such time as the levels are once again met and maintained.
Grant recipients that relocate outside of Charlotte during the term of the Grant – or
within 3 years after receipt of the final Grant installment – will be required to repay
a proportional amount of the Grant.
3
All wages are defined by the U.S. Bureau of Labor Statistics Area Occupational Employment and Wage Estimates.
2
Charlotte-Mecklenburg Business Investment Program
Large Economic Impact Projects
Investment
$30 million
Investment is broadly defined as improvements to land and/or buildings, or the
purchase or lease of new equipment, or buildings constructed for the qualifying
company. Where circumstances warrant, however, Grant calculations may give
consideration to the value of leasehold improvements in existing buildings when it
can be reasonably demonstrated that the lease will cause additional investment to
replace the leased space, or that the lease results in a higher value for the building.
Job Creation
150 new jobs; however, some projects may create fewer jobs yet more investment,
or higher paying jobs with less investment, or a higher number of jobs with lower
average wages, etc. For this reason, such projects could still be considered as a
“large economic impact” project.
Wage Rate
Grant recipients must pay an average wage rate for all employees at the investment
site equal to or greater than 125% of the average annual wage rate for the
Charlotte-Gastonia-Rock Hill M.S.A.3
Should the projected annual average wage rate be less than 125% the M.S.A.
average, the City and County may consider the industry-specific annual average
wage rate in making a determination regarding eligibility.
The required average annual wage rate may be lowered by up to 20% for those
companies that pledge to employ Work First participants and/or residents of the
development zone itself in 25% or more of the new job positions.
Terms and Amounts
Grants last for five years and are based upon either 50% or 90% of new property
taxes generated by the investment, dependent upon whether the project locates in
the investment zone.
Existing businesses within Mecklenburg County are eligible for an additional two
year term.
Clawback Provisions
Same provisions as general programs guideline; however, clawback term will be five
years instead of three.
Major Headquarters Projects
Major Headquarters Projects are defined as “a corporate, divisional or regional
headquarters of a Fortune 1000 company with an annual average wage that
exceeds 200% of the regional average wage3, (currently $89,200).
Grants for such projects will be considered on an individual basis.
3
All wages are defined by the U.S. Bureau of Labor Statistics Area Occupational Employment and Wage Estimates.
3
Charlotte-Mecklenburg Business Investment Program
ATTACHMENT I
ELIGIBLE BUSINESS CLUSTERS
Manufacturing
o Includes:
 Automotive/Transportation Equipment
 Energy
 Medical Devices
 Plastics
 Metalworking
 Industrial Machinery
 Defense & National Security
 Aerospace
 Consumer Products and Food Processing
 Research & Development Facilities
Headquarters
o Includes:
 Corporate, Divisional & Regional
Transportation/Distribution (Logistics)
o Includes:
 Truck transportation
 Support activities for transportation
 Warehousing and storage
Financial, Insurance & Professional Services
o Includes:
 Financial investment & related activity
 Credit intermediation & related activity
 Insurance carriers & related activity
 Funds, trusts & other financial vehicles
 Professional & technical services
 Software development
 Back Office Operations
o Excludes:
 Law Firms or Accounting Firms, or other professional service companies that
predominantly serve the Charlotte region.
Emerging Technologies/Industries
o Includes:
 Opto-Electronics
 Fuel Cells/Alternative Energy
 Bio-Informatics
 Film/Video Production Facilities
 Industries which create synergy with programs of focus at the Charlotte Research
Institute or local colleges and universities.
4
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