Durango deploys incentives program to support local businesses, essential services – The Durango Herald

Policy born of need for grocer in Three Springs area

The city of Durango would like to use incentives to entice certain businesses to move into certain areas, like a grocery store in the Three Springs area. (Durango Herald file)

The city of Durango is implementing a new program to bolster local businesses and their ability to provide essential services by incentivizing selected companies to employ workers and invest in infrastructure.

The Economic Development Incentive Policy adopted by Durango City Council in May will make tax incentives, infrastructure support, grants and loans, and technical assistance, among other incentives, available to select businesses.

Tommy Crosby, economic opportunity manager for the city, said the program will help the economy thrive by encouraging job creation and economic growth while making sure essential services continue to be provided to residents.

He said the program will be more impactful than a similar program also recently adopted by City Council, Colorado’s Rural Jump-Start Zone Plan.

“The main incentive this program has to offer is sales tax,” he said. “This incentive would leverage the amount of sales tax a business pays to the city of Durango such as a sales tax holiday or a sales tax rebate.”

If a business meets certain performance targets like job creation and revenue earned, it would receive a sales tax rebate for some or all of its taxes, depending on the agreement with the city, he said. The rebate could be put to use investing in infrastructure, hiring new employees or supporting community programs.

The new program came about from the need for a grocery store in the Three Springs area, he said.

“Market forces on their own have not been able to deliver a grocery store to that area, and the city deems that an essential service for a growing part of our community.”

When a regional grocer showed interest in expanding into Three Springs, the discussion of tax-based incentives started to form.

“This was a helpful nudge for the city to set out on proactively creating a policy that can be deployed with the best interest of Durango citizens, and businesses, in mind,” he said.

Crosby said infrastructure support in the sense of expanding, relocating or developing a business is another strong tool the new policy can provide.

Examples include aligning city capital improvement projects with a business’ expansion, upgrading or expanding roads to account for increased traffic to a new business, or water and sewer extensions to new developments, he said.

Each incentive agreement will be unique to each business, and the city will use Economic Development Incentive Policy “judiciously and by exception,” meaning the city will only use the policy when it’s ideal financially, he said.

Other incentive agreements formed under the policy could address processes and permitting, such as expedited reviews and permit approvals.

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