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PUBLIC HEARING TO ACCEPT THE ECONOMIC DEVELOPMENT SUBSIDY 2024 ANNUAL REPORT
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RECOMMENDATION
It is recommended that the City Council, by motion, accept the Economic Development Subsidy 2024 Annual Report, which includes all subsidies the City has provided for economic development purposes over $100,000.
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Summary
California Government Code Section 53083 (Attachment A) requires local governments to report any economic development subsidy exceeding $100,000, and to provide specific information to the public before approving any economic development subsidy of $100,000 or more. The City is compliant with these requirements and provides information to the public through reports to the City Council on a per-project and annual basis The City provided $5,037,074.83 in eligible subsidies for the 2024 calendar year.
DISCUSSION
Background
Effective January 1, 2014, Government Code Section 53083 requires local governments to report on any economic development subsidy over $100,000. The term “economic development subsidy” is defined as any expenditure of public funds or loss of revenue to a local agency in the amount of one hundred thousand dollars ($100,000) or more, for the purpose of stimulating economic development within the jurisdiction of a local agency, including, but not limited to, bonds, grants, loans, loan guarantees, enterprise zone or empowerment zone incentives, fee waivers, land price subsidies, matching funds, tax abatements, tax exemptions, and tax credits. Affordable housing projects do not require economic development subsidy reporting.
The following information is required by California Government Code Section 53083:
Before approval of subsidy:
1. The name and address of all corporations or any other business entities, except for sole proprietorships, that are the beneficiary of the economic development subsidy, if applicable.
2. The start and end dates and schedule, if applicable, for the economic development subsidy
3. A description of the economic development subsidy, including the estimated total amount of the expenditure of public funds by, or of revenue lost to, the local agency as a result of the economic development subsidy.
4. A statement of the public purposes for the economic development subsidy.
5. Projected tax revenue to the local agency as a result of the economic development subsidy.
6. Estimated number of jobs created by the economic development subsidy, broken down by full-time, part-time, and temporary positions.
This information is provided to the public through reports to the City Council on a per-project basis.
Within five years after granting subsidy:
1. The name and address of all corporations or any other business entities, except for sole proprietorships, that are the beneficiary of the economic development subsidy, if applicable.
2. The start and end dates and schedule for the economic development subsidy.
3. A description of the economic development subsidy, including the estimated total amount of the expenditure of public funds by, or of revenue lost to, the local agency as a result of the economic development subsidy.
4. The net tax revenue accruing to the local agency as a result of the economic development subsidy.
5. The net number of jobs created by the economic development subsidy, broken down by full-time, part-time, and temporary positions.
This information is provided to the public through the annual Economic Development Subsidy Report.
Present Situation
Local agencies are required to provide an annual report of all economic development subsidies no later than five (5) years after the action granting an economic development subsidy. The City has prepared the 2024 Annual Report (Attachment B) to meet statutory requirements.
The 2024 Annual Report indicates that the City provided $5,037,074.83 in economic subsidies for “qualifying” criteria, which includes projects that received over $100,000 in economic development subsidy and are either bonds, grants, loans, loan guarantees, enterprise zone or empowerment zone incentives, fee waivers, land price subsidies, matching funds, tax abatement, tax exemptions, and tax credits.
The City programs that require annual AB 562 reporting in 2024 are:
• Stockton Economic Stimulus Program (SESP)
• Public Facility Fee Reduction to Non-Residential Projects
• Office and Industrial Sales Tax Incentive Program
Public Notice
A public hearing notice was published in the Stockton Record on May 19, 2025. To date, no comments have been received.
FINANCIAL SUMMARY
Total 2024 subsidies are as follows:
|
Program |
Eligible Subsidies |
|
Stockton Economic Stimulus Program (SESP) |
$2,410,272.81 (Single-family) |
|
Public Facility Fee (PFF) Reduction for Non-residential Projects (part of SESP) |
$563,054.02 |
|
City-Wide Affordable Housing Development Public Facilities Fee Exemption Program |
$ 1,913,474.88 |
|
Office and Industrial Sales Tax Incentive Program |
$2,063,748.00 |
|
TOTAL |
$6,949,549.71 |
There is no financial impact from filing of the Economic Development Subsidy 2024 Annual Report. However, during the 2024 calendar year, the City provided $6,949,549.71 in eligible subsidies.
Attachment A - Government Code Section 53083
Attachment B - Economic Development Subsidy 2024 Annual Report