The City of Merced will be rolling out a new business incentive program Monday.
With last year's elimination of redevelopment agencies and this year's expected reductions in enterprise zones, Sacramento has left local governments without their most effective economic development tools. Despite these setbacks, the City Council has taken action to distinguish Merced from other cities as a business friendly environment.
Beginning July 1, any business that generates sales taxes revenue and opens in our downtown corridor will be eligible to receive a $1,000 check from the city. This money can be used for many different purposes, including employee payroll, initial inventory, property improvements or marketing and will be available to the first 15 businesses that qualify. In order to qualify, businesses simply need to take advantage of the free services that the city is making available through its partnership with the local Small Business Development Center to develop a business plan.
Experience has shown that businesses that have a solid business plan are much more likely to be profitable, stay in business and keep employees on their payroll. The city is interested in measuring the success of this program and will maintain communication with the businesses over the course of the following year to track, for example, how many employees are hired.
As a small business attorney, I know that the early stage of any business can be difficult.
Although $1,000 is not a lot of money, it can make the difference for an entrepreneur on a shoestring budget. Equally important, this business incentive program sends a message to everyone that Merced is open for business and that we welcome you with open arms. If businesses are opening or expanding we want them to think of the city of Merced. If they are hiring employees we want them to think of our residents. We are a great place to do business and shop.
This new incentive program will augment earlier action by the City Council to reduce development impact fees by 55 percent. This reduction has made Merced more attractive to businesses that are looking to open, relocate or expand in our region. At the same time, it allows us to be able to build the infrastructure that will be necessary as our city grows. The city's economic development team has already received positive feedback from large and small employers regarding these reductions. Plans that previously did not pencil out are now being dusted off as a result.
The City Council will continue to be innovative in its approach to creating a business friendly environment in Merced and will monitor the effectiveness of this incentive program. We encourage residents to share the details of this program with others and encourage entrepreneurs to consider taking advantage of this opportunity to develop a solid business plan and open a business in downtown Merced.
Mike Murphy is a member of the Merced City Council and a small-business attorney.