Waterloo OKs incentive plan for Alliance

Jul 20, 2010 — Waterloo-Cedar Falls Courier

Tim Jamison

Jul. 20, 2010 (McClatchy-Tribune Regional News delivered by Newstex) -- WATERLOO -- City leaders will make the Greater Cedar Valley Alliance earn its keep.

Waterloo City Council members voted unanimously Monday to approve a new incentive-based contract for the organization which handles business recruitment and other economic development work for metro area communities.

While the city's past contracts paid the GCVA a flat $85,000 annual fee, the new contract guarantees only $28,500 with the ability to collect a maximum of $85,000 based on a set of performance criteria.

Council members pushed for the incentive plan after learning the city of Cedar Falls, also a partner in the Alliance, has long used a similar method. Cedar Falls pays a $25,000 base fee with the possibility of another $25,000 in incentives; but the full incentive is rarely paid out.

Waterloo Council members had questioned whether the incentive offers would, at least in appearance, encourage the Alliance to steer companies to Cedar Falls. Alliance President and Chief Operating Officer Steve Dust has disputed that assertion but previously indicated he would prefer not to have incentive-based funding in one community but not the other.

Waterloo Councilman David Jones (OOTC:DJNSY) had reservations about the incentive-based plan.

"I do support the Alliance," he said. "I just think incentive clauses are not the thing to be doing in any alliance.

"I'm hoping the Alliance can work through these issues, and come up with a uniform agreement for all the cities," Jones added, "hopefully without incentives."

Councilman Harold Getty voted for the new contract but questioned why Waterloo guaranteed $28,500 while Cedar Falls' guarantee was $25,000.

Mayor Buck Clark said Waterloo has a larger population. "We're matching Cedar Falls in our terminology but not in dollars," he said.

The potential incentives in Waterloo can be earned as follows:

-- $1,000 per acre of new development in an area officially designated for development, provided each acre contains at least 10,000 square feet of building structure.

-- $1,000 per $250,000 of new taxable value added to a development area.

-- $2,500 per new full-time equivalent job created in a development area, providing the jobs have an hourly starting wage of at least $15.63.

-- Up to $5,000 in quarterly performance payments based on GCVA activity, but paid solely at the city's discretion.

The incentives are capped once the city's total payment reaches $85,000 during the year.

Newstex ID: KRTB-0150-47125863