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I boor 98 PAGE 37 In addition, the Board of County Commissioners must determine what businesses will be eligible for the tax abatement program. The Board's discretion in establishing eligibility, however, is limited by the state. According to 196, F.S., eligible businesses are generally limited to industrial establishments, new corporate offices, and retail enterprises having at least 50k of the sales out of state. The Board, however, may establish more stringent eligibility criteria than the state mandates. Generally, more tax revenue. will be derived if tax abatement is limited to only industrial businesses and corporate offices. Also, some types of businesses, particularly retail, will locate in the County regardless of available incentives. Retail businesses locate based on market conditions, not incentives. Finally, the Board must establish any other terms and conditions that it wants to apply to the tax abatement program. With this, the Board could further limit the number of businesses that could receive the tax exemption. The overall tax abatement program criteria set by the Board of County Commissioners will 'constitute minimum standards. Each application, however, will be reviewed separately, and the Board will have the opportunity to impose additional criteria. Consequently, the Board can provide better terms to businesses that will have a greater economic development effect on the county's economy. Benefits The County's economic base presently has little diversification, being primarily dominated by the citrus industry. With the ability of the county to offer tax abatements to new and expanding industrial businesses, the county can enhance its economic development prospects and may receive the following benefits: • Reduced unemployment • Stimulated economy • Diversified economic base • Increased number of jobs • Increased employment opportunities in year round businesses • Broadened property tax base • Enhanced economic stability • Additional sales taxes These benefits are based on the assumption -that new economic development will create and produce a positive effect on peripheral businesses located in the county. In addition, the consumption of goods and services will increase as the County's economic base increases. Besides the general benefits referenced above, the tax abatement program would provide specific benefits to the county. Overall, the tax abatement Droaram will! • Provide the county with a new economic development tool; • Bring Indian River County up to the level of its competing counties; • Impose no "out of pocket" costs on the county, (only forgoing revenue that may not have existed); • Create a better economic development perception; • Ensure that the county will eventually receive full tax revenue from those improvements receiving a short term tax exemption. - May 14, 1996 M 32 M