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Progressive Processing, LLC / Hormel State Assistance ApplicationMasterpiece on the Mississippi Dubuque band AI- America City 1 2007 • 2012 • 2013 TO: The Honorable Mayor and City Council Members FROM: Michael C. Van Milligen, City Manager SUBJECT: State of Iowa Business Financial Assistance Application for Progressive Processing, LLC DATE: October 29, 2013 Economic Development Director Maurice Jones recommends City Council approval of the submission of a Business Financial Assistance Application to the Iowa Economic Development Authority on behalf of Progressive Processing, LLC, a subsidiary of Hormel Foods Corporation. Progressive Processing has proposed expansion within the Dubuque facility to increase capacity for two additional products existing within the company. Product No. 1 is currently manufactured by a third party on Hormel's behalf at a facility outside of Iowa. The proposal would relocate the entire production to Dubuque. Product No. 2 is currently made at two domestic production facilities outside of Dubuque and the company is exploring growing the line by adding capacity. Both projects would collectively require an estimated $31.4 million in machinery and building improvements, although the taxable value increase associated with the improvements at the facility, located at 1205 Chavenelle Court, will likely be minimal. The proposed project would add 91 jobs and promote the City's goals of growing existing businesses and further diversifying the economic base. The application on behalf of the company will provide State financial assistance to enable the two proposed expansions in Dubuque. Progressive Processing, LLC has applied for up to $1,842,000 in investment tax credits, $114,000 in research and activities tax credits, and a $495,000 sales and use tax refund pending IEDA approval. Additionally, the company has applied for a $160,000 loan from the State, of which $80,000 is forgivable. Northeast Iowa Community College will be providing a 260E job training grant of $450,173. Local sponsorship of the application is required for approval. Due to the minimal increase of assessed value associated with the improvements, the proposed local match is an additional five years of tax increment financing rebates. This will amount to $1,342,000 in property tax rebates paid to the company at $268,400 a year over a five -year period. This is approximately 40% of the increment that the original Hormel project generates. If Hormel elects to proceed with the two projects in Dubuque, the City Council will need to amend the existing Development Agreement with the company to memorialize the incentive. I concur with the recommendation and respectfully request Mayor and City Council approval. Michael C. Van Milligen MCVM:jh Attachment cc: Barry Lindahl, City Attorney Cindy Steinhauser, Assistant City Manager Teri Goodmann, Assistant City Manager Maurice Jones, Economic Development Director Jennifer Larson, Budget Director 2 THE CITY OF Dui Masterpiece on the Mississippi Dubuque kattil All- America City 11111 r 2007 • 2012 • 2013 TO: Michael Van Milligen, City Manager FROM: Maurice Jones, Economic Development Director SUBJECT: State of Iowa Business Financial Assistance Application for Progressive Processing, LLC. DATE: October 29, 2013 INTRODUCTION This memorandum presents for City Council review and approval a resolution authorizing the submission of a Business Financial Assistance Application to the Iowa Economic Development Authority (IEDA) on behalf of Progressive Processing, LLC a subsidiary of Hormel Foods Corporation. BACKGROUND Progressive Processing, LLC, (a wholly owned subsidiary of Hormel Foods Corporation) located in the Dubuque Industrial Center West. The plant officially opened on January 25, 2010 when it processed its first line of Hormel Compleates ® microwave meals. Additionally, the plant also processes canned chicken. Hormel Foods Corporation is a multi - national manufacturer and marketer of consumer - branded meat and food products. The company sells to consumers, retail grocers, foodservice and industrial customers in 50 states and more than 40 countries. The headquarters for Hormel Foods is located in Austin, Minnesota with its research and development division and flagship plant. The company also has domestic plants in Georgia, Kansas, Illinois, Wisconsin, Nebraska, and California to go along with six other locations in Iowa. The company has proposed expansion of the Dubuque facility to increase capacity for two additional products existing within the company. Product No. 1 is currently manufactured by a third party on Hormel's behalf at a facility outside of Iowa. The proposal would relocate the entire production to Dubuque. Product No. 2 is currently made at two domestic production facilities outside of Dubuque and the company is exploring growing the line by adding capacity locally. Both projects would collectively require an estimated $31.4 million in machinery and building improvements, although the taxable value increase associated with the improvements at the facility, located at 1205 Chavenelle Court, will likely be minimal. Significant competition exists for both products. Hormel is considering negotiating improvements and installing new equipment outside of Dubuque for this project. Product No. 2 has significant growth projections outside of the United States and the company is considering the creation of a new facility abroad, most likely in Asia or South America. Additionally, expansions to existing domestic locations outside of Iowa remain a possibility. Collectively, the projects would add an estimated 91 jobs to the community. DISCUSSION The application on behalf of the company will provide State financial assistance to enable the two proposed expansions in Dubuque. Progressive Processing, LLC has applied for up to $1,842,000 in investment tax credits, $114,000 in research and activities tax credits, and a $495,000 sales and use tax refund pending IEDA approval. Additionally, the company has applied for a $160,000 loan from the State, of which $80,000 is forgivable. Northeast Iowa Community College will be providing a 260E job training grant estimated at $450,173. Local sponsorship of the application is required for approval. Due to the minimal increase of assessed value associated with the improvements, the proposed local match is an additional five years of tax increment financing rebates. This will amount to $1,342,000 in property tax rebates paid to the company at $268,400 a year over a five -year period. If Hormel elects to proceed with the two projects in Dubuque, the City Council will need to amend the existing Development Agreement with the company to memorialize the incentive. RECOMMENDATION I recommend that the City Council authorize the submission of a State of Iowa Business Financial Assistance Application on behalf of Progressive Processing, LLC for the proposed investment of $31.4 million for new machinery and building remodeling at their location on 1205 Chavenelle Court. The proposed project would add 91 jobs and promote the City's goals of growing existing businesses and further diversifying the economic base. ACTION STEP The action step for the City Council is to adopt the attached resolution. attachment F: \USERS \Econ Dev \Hormel\20131029 IEDA application Council memo.docx RESOLUTION NO. 319-13 A RESOLUTION AUTHORIZING THE FILING OF AN APPLICATION FOR STATE BUSINESS FINANCIAL ASSISTANCE ON BEHALF OF PROGRESSIVE PROCESSING, LLC. Whereas, Progressive Processing, LLC, a subsidiary of Hormel Foods Corporation, has proposed making a $31.4 million investment as part of an expansion at their facility in Dubuque, Iowa; and Whereas, the City Council of Dubuque, Iowa has considered said proposal and has determined that the proposed project will contribute to the local economy in Dubuque through the creation of 91 jobs; and Whereas, financial assistance from the Iowa Economic Development Authority is designed to assist in the economic development efforts of local jurisdictions; and Whereas, the City of Dubuque, Iowa must provide local sponsorship on behalf of Progressive Processing, LLC for their Business Financial Assistance Application with the Iowa Economic Development Authority. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF DUBUQUE, IOWA: Section 1. That the filing of an application for participation in the Iowa Economic Development Authority's Financial Assistance Program on behalf of Progressive Processing, LLC is hereby approved. Section 2. That a five year tax increment financing rebate of $268,400 per year will be provided as required local match, subject to further action by the City Council. Section 3. That the Mayor is hereby authorized to execute and the City Manager is hereby directed to submit said application to the Iowa Economic Development Authority together with such documents as may be required. Passed, approved, and adopted this 4th day of November, 20 F: \USERS \Econ Dev \Hormel\20131029 Resolution IEDA App Approval.docx Roy D. Buol, Mayor WA Debi V. Durham, Director Iowa Economic Development Authority Business Financial Assis ance °cation Business Finance - Business Development Division Iowa Economic Development Authority 200 East Grand Avenue Des °Ines, Iowa 50309-1819 WWW.lowaeconomialgvelo ment,com Telephone: 515.7253134 Erna business ance@io a, ov Application Instructions To Complete Electronic Form: Click on TEXT BOX to add text. Double click on YES/NO boxes and select "Checked". 1. All applicants must complete the Business Financial Assistance Application and attach only those additional sections for the components to which the applicant is applying. STATE of IOWA - Ei Enterprise Zone Program (EZ) Supplemental info required— Section G - EZ Supplement Financial Assistance Programs High Quality Jobs Program (HQJP) Tax Credits Direct Financial Assistance 2. Before filling out this application form, please read all applicable sections of the Iowa Code and Iowa Administrative Code (rules). w.legis.stateja.us/lowaLaw.html 3. Only typed or computer-generated applications will be accepted and reviewed. Any material change to the format, questions, or wording of questions presented in this application will render the application invalid and it will not be accepted. 4. Complete the applicable sections of the application fully. If questions are left unanswered or required attachments are not submitted, an explanation must be included. 5. Use clear and concise language. Attachments should only be used when requested or as supporting documentation. 6. Any inaccurate information of a significant nature may disqualify the application from consideration. 7. The following must be submitted to Business Finance at IEDA in order to initiate the review process: One original, signed application form and all required attachments One electronic copy of the application form and all required attachments Facsimile copies will not be accepted. Applications must be submitted to IEDA Business Finance before 4:00pm on the fourth Monday of the month. Applications will be reviewed by the IEDA Board on the third Friday of the following month. Public Records Policies During the application process, the information submitted by you to IEDA is exempt from disclosure under the "industrial prospects" exemption found in Section 22.7(8). However, once you receive an award, the industrial prospects exemption no longer applies and all documents submitted and generated during the application and negotiation process become public records under Iowa's Open Records Law (Iowa Code, Chapter 22), unless 1) The information belongs to one of the classes of records automatically treated as confidential; or 2) You have applied for and received written notice, that your information will be treated as confidential. Automatically Confidential Records I EDA automatically treats the following records as confidential and will hhold them from public inspection even without a request for confidential treatment: • Tax Records and Tax Liability Information • Quarterly Iowa Employer's Contribution and Payroll Report prepared for the Iowa Workforce Development Department Payroll Registers Business Financial Statements and Projections (unless those statements are already publicly available elsewhere, e.g., 10-K filings) Personal Financial Statements Exemptions to the Open Records Law If you wish to have additional information treated as confidential, you must fill out the confidential treatment request form. Under the Open Records Law, IEDA may lawfully treat certain information as confidential if that information falls within an exemption to the Open Records Law. The following exemptions represent records which may lawfully be treated as confidential under the Open Records law and which are most often applicable to the information submitted to IEDA: Release of information would give an unfair advantage to competitors — Iowa Code Sec. 15.118 Trade secrets — See Iowa Code section 22.7(3), see also Iowa Code Ch. 550 Information on an industrial prospect with which the IEDA is currently negotiating — See Iowa Code section 22/(8) Communications not required by law, rule or regulation made to IEDA by persons outside the government to the extent that I EDA could reasonably believe that those persons would be discouraged from making them to I EDA if they were made available for general public examination — Iowa Code section 22.7(18) Non-Confidential Information Information that is submitted to IEDA as part of the application process or that is contained in a contract for program benefits is generally considered material to the eligibility requirements of the program or to the amount of incentives or assistance to be provided. Such information is generally not given confidential treatment. Such information includes but is not limited to, the number and type of jobs incented, the wage levels for the incented jobs, your company's employee benefit information, and your project budget. Additional Information Available. Copies of Iowa's Open Record law and IEDA's administrative rules relating to public records are available from the IEDA upon request. 'EDF\ — BuSiness Financial Assistance Application 2 v„2.1.2013 SECTION A Applicant Information 1. Name of Business: Hormel Foods Corporation 2. Entity Name (for contracting purposes):Progressive Processin , LLC 3. Address: 1 Hormel Place 4. City, State & Zip Code: Austin, MN 55912 5. Contact Person: Angela DeMorett Title: Tax Manager 6. Phone: 507-437-5435 Fax: 507-434-6731 amdemorett@hormel.com 7. FEIN: 41-0319970 8. NAICS Code for primary business operations: 311611, 9. US DOT Number: Date Application Submitted: Email: 10. Does the Business file a consolidated tax return under a different tax ID number? 111 Yes (If yes, please also provide that tax ID number) i1 No a. Is the contact person listed above authorized to obligate the Business? [1] Yes No If no, please provide the name and title of a company officer authorized to obligate the Business: Roland G. Gentzler, VP Finance & Treasurer 11. If the application was prepared by someone other than the contact person listed above, please complete the following: Name of Business: Address: City, State & Zip Code: Contact Person: Title: Phone: Fax: Email: Sponsor Information (A sponsor organization is a city or county) 12. 13. 14. 15. 16. Sponsor Organization: City of Dubuque, Iowa Official Contact (e.g. Mayor, Chairperson, etc Roy D. Buol Title: Mayor Address: 50 W. 13th St. City, State & Zip Code: Dubuque, Iowa 52001 Phone 563-589-4100 Fax 563-589-0890 Email: 17. If IEDA needs to contact the sponsor organization with questions, should we contact the person listed above? LI Yes C4 No, please contact the following person: Name: Maurice Jones Title: Economic Development Director Address: 50 W. 13th St. City, State & Zip Code: Dubuque, Iowa 52001 Phone: 563-589-4393 miones @cityofdubuclue.orci Fax: 563-589-1733 Email: If necessary, please list information on additional sponsors in an attachment. LEDA ---- Business Financial Ass is lianc3,-3. A pprication v , 2 1 201 3 SECTION B Business Information 1. Provide a brief description and history of the Business. Include information about the Business' products or services and its markets and/or customers. Progressive Processing, LLC, is a wholly owned subsidiary of Hormel Foods Corporation, located in Dubuque, owa. The plant officially opened on January 25, 2010, when it produced its first run of Hormel® Compleates® microwave meals. Along with microwave meals, the plant also runs a line of canned chunk chicken. Hormel Foods Corporation is a multinational manufacturer and marketer of consumer - branded meat and food • roducts man of which are amon • the best known and trusted in the food indust The com an en'o s a stron • reputation among consumers, retail grocers, and foodservice and industrial customers for products highly regarded for quality, taste, nutrition, convenience, and value. Hormel Foods and its' subsidiaries sells products in all 50 states through a direct sales force assigned to offices in, major cities throughout the United States. Their efforts are supported by sales brokers and distributors. Hormel Foods International (HFIC), a wholly owned subsidiary in Austin, has established numerous joint venture and license, agreements internationally that include Australia, China, Denmark, England, Japan, Korea, Mexico, Panama, Canada, the Philippines, Spain and other nations. HFIC exports products to more than forty countries. The headquarters for Hormel Foods is in Austin Minnesota along with its research and development division and, flagship plant. Company facilities that manufacture meat and food products are located in Algona, Knoxville, Osceola, Nevada, Fort Dodge, Dubuque, and Bondurant Iowa; Atlanta, Savannah and Bremen Georgia; Wichita and Alma Kansas; Aurora and Rochelle Illinois; Beloit, New Berlin, Baron and Sparta Wisconsin; Fremont Nebraska; Stockton, Turlock, San Leandro, Chino, Visalia, and Vernon California. Custom manufacturing of selected Hormel Foods products is performed by various companies that adhere to stringent corporate guidelines and quality standards. , With more than 19,700 employees, Hormel Foods is owned by approximately 11,400 shareholders of record. Hormel Foods common stock is listed on the New York Stock Exchange under the ticker symbol HRL. 2. Business Structure: 0 Cooperative ri Corporation E Limited Liability Company El Partnership 0 S- Corporation LI Sole Proprietorship 3. State of Incorporation: Delaware 4. Identify the Business' owners and percent ownership: Hormel Foods is a publicly traded corporation with, approximately 11,500 shareholders of record. 5. Does a woman, minority, or person with a disability own the Business? El Yes No 6. List the Business' Iowa locations and the most current number of employees at each location. Progressive Processing currently has 201 employees located in Dubuque, Iowa., 7. What is the Business' worldwide employment? (Please include employees of parent company, subsidiaries, and other affiliated entities in this figure.) Hormel Foods and subsidiaries employ approximately 19,700 employees worldwide. Project Information 8. Project Street Address: 1205 Chavenelle Court Project City & Zip Code: Dubuque, 52002, Project County: Dubuque County 9. Type of Business Project: ❑ Startup Expansion of Iowa Company LI New Location in Iowa 10. Describe the proposed project for which assistance is being sought. (Include project timeline with dates, facility size, infrastructure improvements, proposed products /services, any new markets, etc.) Hormel Foods Cor• oration 'Hormel': Pro ressive Processin s parent cam an ; no oses to expand utilization of the Dubu ue faciii to add caacit to manufacture two additional •roducts at the faciiit . Product 1 is an ems *n oduct that is currentl manufactured b a 3rd •art on Hormel's behalf at a facilt in Minnesota. The aro osal is to relocate production of Product #1 to the Dubuque facility. Product #2 is an existing product that is currently made at Hormel facilities in Minnesota and Nebraska. The proposal is to expand manufacturing capacity for Product #2 by expanding production of the product to the Dubuque facility. 11. Project Timeline (add additional ro s as needed) Add capacity to anufacture product #1 Add capacity to manufacture product #2 Beginning Activity Date December 2013 December 2013 Activity Completion Date July 2014 June 2015 (full capacity by 2017) 12. Has any part of he project started*? E] Yes If yes, please explain. 04.4 No * For IEDA's purposes, starting the project includes: the start of construction or rehabilitation, the purchase of a building, the execution of a lease, or the installation of equipment to be used in the project. 13. Identify the Business' competitors. If any of these competitors have Iowa locations, please explain the nature of the competition (e.g. competitive business segment, estimated market share, etc.) and explain what impact the proposed project may have on the Iowa competitor. Hormel Foods and subsidiaries compete domestically and internationally with various companies including but not limited to ConAgra Foods, Kraft Foods, Smithfield Foods, Oscar Mayer Foods, Cargill Inc., and Tyson Foods. 14. Will any of the current Iowa employees lose their jobs if this project does not proceed? El Yes No If yes, please explain why and identify those jobs as "retained jobs" in the Project Jobs Section E. 15. Is the Business actively considering locations outside of Iowa? Yes E] No If yes, where and what assistance is being offered? Hormel is considering negotiating improvements and installing new equipment at the 3rd party manufacturing facility in Minnesota for Product #1. Product #2 is sold both domestically in the US as well as throughout the world, including a very large growth in demand in the Asian market. Sales growth projections indicate that non-US sales growth will continue to outpace US sales growth. Hormel is considering multiple locations including possible expansion in Minnesota or Nebraska as well as opening a new facility outside the US, most likely China, to expand manufacturing capacity for Product #2., 16. Please identify the company project management for the project location and experience. Mike Devine is the VP of Grocery Products Operations for Hormel Foods and has 32 years of experience with Hormel in the food manufacturing industry. Mark Zelle is plant manager of Progressive Processing and has over 30 years of experience with Hormel. He has been the plant manager in Dubuque for the past four years and has over 30 years of experience with Hormel. IEDA E3Li;Eilni-3,z5s n a ti tan A pp hca Applicant's Project Budget 1. 2. SECTION C, Does the Business plan to lease the facility. Yes 1No If yes, please provide the Annual Base Rent Payment (lease payment minus property taxes, insurance, and operating/maintenance expenses) for three years in the budget below, and only major renovation costs your company expects to incur. Administrative rules require that the lease be in place for a minimum of five years. Please complete the budget below. Include only costs the company plans to incur directly: Use of Funds Cost Base Rent (3 years) Tenant Improvements Land Acquisition • Site Preparation Building_ Acquisition Building Construction Source A Building Remodeling $11,200,000 160,000 Mfg. Machinery & Equip. • $19,400,000 Other Machinery & Equip $800,000 Racking, Shelving, etc. Computer Hardware Computer Software Furniture & Fixtures Working Capital Research & Development Other TOTAL $31,400,000 $160,000 Source B Source C 11,040,000 Source 19,400,000 $800,000 $31,240,000 Racking, shelving and conveyor equipment used in distribution center projects only . Please complete the chart below with proposed financing for the project (tax benefits should be reflected as indirect financing under #5 below): Source E Source F PROPOSED FINANCING Source of Funds Amount Add additional lines as needed Form of Funds (Loan, Grant, In- Kind, Donation, etc. Rate and Term Commitment Status Conditions/Additional Information Include when funds will be disbursed; If loan, whether payments are a level term, balloon, etc Source A: IEDA (see #4 below) $160,000 Loan 0°10 50% Forgivable/50% Repayable Source B: Local Government $ Source C: Business $31,240,000 Source D: Other Source Source E Other Source $31,400,000 Source F: Other Source TOTAL 1 4. Direct financial assistance (loans/forgivable loans) must be secured with acceptable collateral. Please select the type of collateral your company will pledge to secure the IEDA financing, and document its value in Attachment A5. No collateral, funding disbursed at the end o evocable letter of credi Dedicated certificate of deposit Surety bond Mort.a.e on real estate he 5-year contract Explain: Issued b Hormel Foods Cow atlon Personal •uarantee * The IEDA Board has the final discretion on what collateral will be accepted. IEDA — Buliiiness Firlanc3ial AssistanCe „ApplICatiOn 5. Please complete the chart below with tax credits and other indirect financing expected for the project: TAX CREDITS AND INDIRECT FINANCING Source of Funds Investment Tax Credit Sales, Service & Use Tax Refund Research Activities Credit (3%/10%) Local Property Tax Exemption Tax Increment Financing 260E Job Training Funds In-kind Contribution Other TOTAL Amount 1,842,000 495,000 114,000 1,342,000 450,173 $4,243,173 Description 6% of $30,700,000 3°. Supplemental Credit up to 5 years paid over 5 years job training reimbursements from the Community College 6. There are three justifiable reasons for providing assistance. Check the box next to the reason why assistance is needed to complete this project. Financing Gap - A gap exists between the financing required and the financing on-hand and the provision of tax incentives or assistance is necessary to fill the gap. Ej Rate of Return Gap —The likely returns of the project are inadequate to motivate a company decision maker to proceed with the project even if sufficient debt or equity can be raised to finance the project, and the project's risks outweigh its rewards, making the provision of tax incentives or assistance necessary to reduce the project's risks. Location Disadvantage (Incentive) —The business is deciding between a site in Iowa ("Iowa site") and a site in another state ("out-of-state site") for its project and the cost of completing the project at the out-of-state site is demonstrably lower, making tax incentives or assistance necessary to equalize the cost differential between the two sites. Note: The authority will attempt to quantify the cost differential between the sites. 7. Please provide a brief explanation of the need for assistance. If Product #1 stays at the existing co-packer's facility in Minnesota, Hormel would have to upgrade the co-packer's manufacturing process and facility. Hormel's analysis indicates the improvments would cost approximately $4.6M versus $9.7M to relocate the production of Product #1 to Progressive Processing in Iowa. Product #2 is sold both domesticaly in the US as well as throughout the world. Sales growth projections indicate that non-US sales growth will continue to outpace US sales growth, with a very large growth in demand in the Asian market. Hormel's analysis shows manufacturing Product #2 in China would lower shipping costs to China and the rest of the Asian markets compared to shipping the product from the US. Approximately 2-3 years ago, for a period of time, China did not allow product manufactured outside of China to be sold within the country. Manufacturing in China would eliminate the risk of China imposing a shipping stoppage of Product #2. Hormel's analysis shows the cost of production per unit for Product #2 is estimated to be 12.6% higher manufactured in Iowa at Pro essive Processin versus the Minnesota and Nebraska facilities currentl manufacturin the product. E-TvA Ar-bancal ,A.35,fsistiance Appiication Employee Benefits SECTION D There are three options to meeting the sufficient benefit requirement. These options are detailed in the chart below. Please complete questions 1-3. If your company meets Option 1 or 2, no additional information is required. If you would like to utilize Option 3, please also complete questions 4-6. Option 3 Total Number of Employees in Iowa Option 1 80% single Coverage Option 2 50% Family coverage Monetary Equivalent Pay 80% of premium costs for a standard medical plan, single coverage. Pay 50% of premium costs for a standard medical plan, family coverage. 250+ $750 maximum deductible $1,500 maximum deductible 50-249 0-50 $1250 maximum deductible $2500 maximum deductible $1750 maximum deductible $3500 Maximum deductible Provide medical and pay the monetary equivalent of Option 1 or Option 2 in supplemental employee benefits. Benefits Counted Toward Monetary Equivalent: Medical coverage, Dental coverage, Vision insurance, Life insurance, Pension, 401(k) (company's Average contribution, Short-/long-term disability insurance, Child care services, Other nonwage compensation . How many full-time, permanent employees does your company currently employ within the State of Iowa? Progressive Processing, a subsidiary of Hormel Foods Corporation, currently employs 201 employees in Iowa. 2. What is the total premium cost for a standard medical plan for single employee coverage? $6,103 or $4,343 depending on the employee's election. a. What portion of this cost is paid by the business? 84.66% or 85.03%, b. What is the deductible associated with this plan? $400 or $1,000 What is the total premium cost for a standard medical plan for family coverage? on the employee's election. a. What portion of this cost is paid by the business? 83.68% or 88.33%, b. What is the deductible associated with this plan? $800 or $2,000 4,023 or $11,581 depending No additional information required, in this section, if your company meets the requirement for Option 1 or Option 2, 4. benefits to full time employees? If es, please provide the annual a Benefit ount offered by the business, Dental Insurance — Family plan Pension (Use 3-year average calculated below) Does your company provide additional Li Yes El N o er employee in the chart belo Annual amount paid by the business •e em to ee Retirement Plan - i.e. 401(k) (Use 3-year average calculated below) Profit Sharing Plan (Use 3-year average calculated below Childcare Services e Insurance coverage Disability Insurance coverage Health Savings Account (HSA) contribution TOTAL Business Financial Assistance Appiicatiori 8 v.212013 5. Does the Business offer a pension plan, 401(k) plan, and/or retirement-plan? E] Yes No If yes, please indicate the amount contributed on a per employee basis by the Business to the plan for the last three years. For 401(k) plans, please provide information on the company match and indicate the average annual match per employee. Year Ending Average Actual Match per Employee ($) Three-year Average: 6. Does the Business offer a profit-sharing plan? El Yes EI No If yes, please indicate total amount paid out each year for the past three years and then, determine the average annual bonus or contribution per employee for that three year period. Year Ending Average Actual Share per Employee ($) Three-year Average: Notes: 1. A qualified plan must be offered to all full-time permanent employees. 2. If you have multiple health insurance plans, please provide information on each plan. Hriaricial ik36tance Application ,11 2(1)1 3 Project Jobs SECTION E 1. List the jobs that will be created and/or retained as the result of this project. (A retained job is an existing job that would be eliminated or moved to another state if the project does not proceed in Iowa.) For jobs to be created, include the starting and final, hourly wage rate. For retained jobs, include the current hourly wage rate. Full-Time CREATED Jobs Job Title (Add additional o s as needed) Number of CREATED Jobs Starting Hourly Wage Wage at 36 months following the award Maintenance Planner/Scheduler Maintenance Engineers Production Supervisors Mechanics/Electricians 42.25 46.17 2 37.25 40.70 7 23.25 25.41 14 21.41 23.40 Quality Control Auditors Accounting Clerks 8 15.30 16.72 2 14.62 15.98 Production Laborers 57 13.58 14.84 Total Full-Time CREATED Jobs Fu Time RETAINED Jobs 91 Add additional o s as needed Number of RETAINED Jobs Current Hourly Wage 2. Is the hourly wage rate based on a 40 hour work week, 52 weeks per year? Yes El No If no please explain: iESIJA — Business Ismiianiciati Assistance Appiication u vii2ci 2013 SECTION G Attachments Please attach the following documents: Al Project Plan Please provide an executive summary for your project. This information should include, at a minimum, expanded information about the company's products and services and any other project related information that has not already been described in the application for financial assistance. Please note, a traditional business plan, including an executive summary, market analysis, organization and management structure, marketing and sales management, service and product line narrative, financial projections, feasibility study and patent status, as well as any other relevant information, may be requested by the Iowa Economic Development Authority to evaluate the feasibility of this project. A2 Payroll Information (Confidential) • Copies of the Business' Quarterly Iowa Employer's Contribution and Payroll Report for the past year. This report should include the monthly employment totals. A copy of the most recent payroll report for one pay period. The copy of the most recent payroll report for one pay period must be in Excel format and include the following information: O Company name, date of payroll and source of payroll information O Employee name and/or employee identification number O Current hourly wage - do not include bonuses or other benefit values O Indicate if the employee is full time (40 hours per week, 52 weeks per year) or part time. O A sample Excel spreadsheet can be found at htt ://www.iowaeconom icdevelo ent.com/userdocs/docu ents/ieda/AttachmentA2- PayrollTemplate.xls A3 Affidavit that states the Business has not, within the last five years, violated state or federal statutes, rules, and regulations, including environmental, worker safety regulations and antitrust laws, or, if such violations have occurred, that there were mitigating circumstances or such violations did not seriously affect public health or safety or the environment. A sample affidavit can be found at http://www.iovvaeconomicdevelopment.com/userdocs/documents/ieda/AttachmentA3-Affidavit.doc A4 Financial Information (Confidential, unless already publicly available) (Existing Businesses Only) • Profit and loss statements and balance sheets for past three year-ends; Current YTD profit and loss statement and balance sheet; Schedule of aged accounts receivable; • Schedule of aged accounts payable; and Schedule of other debts. A5 Collateral documentation Of requesting direct financial assistance only) Enterprise Zone Supplement — EZ -1 Application Supplement for Enterprise Zone applications only 1. Enterprise Zone detail: a. In which Enterprise Zone will this project occur (include the zone's name, number, size in acres, and date certified)? b. Please list any additional requirements adopted by the local Enterprise Zone Commission and how the Business will meet each requirement 2. The following documentation must also be submitted:, a. Legal description of the business site on which the project will occur b. Detailed map (no larger than 11"x17") showing the business site in relation to the boundaries of the certified Enterprise Zone c. Proof that the local Enterprise Zone Commission meeting, during which this application was approved, was open to the public (Le. public notice which was published and/or posted) lEitatik — ausiniess Finianciall Assistance Application 12 i _2013 d. Meeting minutes from the local Enterprise Zone Commission meeting, during which this application was approved e. Resolution by the local Enterprise Zone Commission approving this application SECTION H Certification & Release of Information 1. 2. 3. 4. 5. 6. Are there any judgments or court act ions completed or pending against the applicant entity, or any current or prospective officer, principal, director, or owner? ❑ Yes ® No Has any current or prospective officer, principal, director, or owner been accused or convicted of any wrongdoing or crime, other than a simple misdemeanor? ❑ Yes ® No Have there been any current or past bankruptcies on the part of the applicant entity (or predecessor entities), or on the part of any current (or prospective) officer, principal, owner or in any business dealings of current (or prospective) officers, principals, or owners of the applicant entity? ❑ Yes ® No In the last five years have there been, or are there currently any investigations of potential violations of public health, safety (including workplace safety) or environmental laws by the applicant entity, or any current or prospective officer, principal, director, or owner? ❑ Yes ® No In the last five years have there been, or are there currently any violations of antitrust laws by the applicant entity, or any current or prospective officer, principal, director, or owner? ❑ Yes ® No If yes to any of the above, please provide additional explanation: I hereby give permission to the Iowa Economic Development Authority (IEDA) to research the Business' history, make credit checks, contact the Business' financial institutions, insurance carriers, and perform other related activities necessary for reasonable evaluation of this application. I also hereby authorize the Iowa Department of Revenue to provide to IEDA state tax information pertinent to the Business' state income tax, sales and use tax, and state tax credits claimed. I understand that all information submitted to IEDA related to this application is subject to Iowa's Open Record Law (Iowa Code, Chapter 22), unless specifically marked as confidential section. I understand that IEDA reserves the right to negotiate the financial assistance. I understand this application is subject to final approval by IEDA and the Project may not be initiated until final approval is secured. Furthermore, I am aware that funds will not be disbursed until a contract has been executed and the appropriate terms have been met. I hereby certify that all representations, warranties, or statements made or furnished to IEDA in connection with this application are true and correct in all material respect. I understand that it is a criminal violation under Iowa law to engage in deception and knowingly make, or cause to be made, directly or indirectly, a false statement in writing for the purpose of procuring economic development assistance from a state agency or subdivision. For the Business: "44i For the Sponsor(s): Signature Q n Date Signatur i0.,� Cye+ite v - Vice 1)(61c/ten-1- Roy D. Buol, Mayor /1 11/4/13 Name and Title (typed or printed) Date Name and Title (typed or printed) Please use the following if more than one sponsor is required. (For example, use this if a signature from the local Enterprise Zone Commission is required in addition to the signature from the Mayor of the sponsoring city.) IEDA — Business Financial Assistance Application 13 v.2.1.2013 Signature Date Name and Title (typed or printed) IEDA will not provide assistance in situations where it is determined that any representation, warranty, or statement made in connection with this application is incorrect, false, misleading or erroneous in any material respect. If assistance has already been provided prior to discovery of the incorrect, false, or misleading representation, IEDA may initiate legal action to recover incentives and assistance awarded to the Business. IEE)A BusineF6 Financiai Assi:staf-ice AppliCatial v,2,41. ;2013