Steamboat lab incentive could be model
City’s $40K to ACZ might guide efforts to promote job creation
Steamboat Springs — A $40,000 incentive from the city of Steamboat Springs for the potential expansion of ACZ Laboratories could shape the city’s future promotion of economic development, in a spirit reminiscent of the former enterprise zone on Steamboat Springs’ west side.
ACZ Laboratories conducts environmental testing for a variety of clients, primarily in the mining and petroleum industries. Those clients span the globe. ACZ President and CEO Audrey Stover said ACZ’s customer list includes two gold mines in Ghana and clients in South America, Eastern Europe and Russia, among other foreign locales and in addition to ACZ’s domestic work.
“Right now, we do a lot of gold and copper mines,” ACZ owner Les Liman said last week at ACZ’s facility on Downhill Drive, off Elk River Road on Steamboat’s west side.
ACZ’s work for gold mines includes testing discharged groundwater for contaminants, for example. Walking through ACZ’s hallways, past pristine labs and coolers filled with shipped vials, Liman and Stover spoke offhandedly about parts per trillion and picocuries.
Overseas customers ship samples to American laboratories for their security and lack of corruption, factors that provide “legally defensible data,” Stover said.
“Our niche market is mining,” she added. “We’re known for our metals work.”
That work is paying off.
ACZ is considering an expansion next year that would add nearly 8,000 square feet to ACZ’s building — currently about 23,000 square feet — at a cost of about $1.4 million. Liman said the expansion would enable ACZ to move toward taking on more customers and, thereby, more employees, in addition to shorter-term jobs for construction workers.
Stover said ACZ has 49 employees.
Liman has used job creation to pitch ACZ’s request for a financial incentive from the city to help fund the expansion.
The incentive essentially would come in the form of a tax refund.
“The city cannot waive taxes,” Steamboat Springs planning documents state. “Les Liman/ACZ will be required to pay all the applicable taxes and fees up front and the incentive will be a payment, ‘maximum incentive amount,’ payable 30 days after the issuance of a certificate of occupancy.”
Liman requested $45,000, based on his estimate of use, sales and excise tax related to the expansion. Liman told the Steamboat Springs City Council this month that the city “throws a lot of money at various projects at the ski area,” referring to the multiyear, multimillion-dollar redevelopment at the base of Mount Werner. After a discussion, the council decided to offer $40,000 in incentives.
“We’re not asking for a whole lot here — and you’re not going to get any tax money if we don’t get” the incentive, Liman said. “This is a big business that’s owned locally. That’s unusual here. … We get solicited continually to bring this business somewhere else.”
Liman clarified that he did not mean his comments as a threat, but rather as a reflection of ACZ’s realities. Shipping and specialized equipment maintenance, he said, are better suited to a metropolitan location.
Liman has owned ACZ since 1989. The Downhill Drive building was built in 1991 and expanded in 1999. He said the business remains in Steamboat for a simple reason.
“Our staff is here, and the people who work here like being here,” Liman said.
Eyes on enterprise
The City Council gave initial approval to the idea Sept. 7. On Oct. 19, the City Council supported a $40,000 incentive in a 5-2 vote.
“I think it’s really important for us to stand by our priority to create jobs” and diversify the economy, Councilwoman Meg Bentley said.
Council members Walter Magill and Scott Myller voted against the amount, which they called too large. Magill suggested a range of $23,000 to $25,000, saying the city should hold onto excise taxes for its ailing general fund.
City finance staff estimated $23,000 as the amount that, accounting for sales and use taxes, would have been exempt in Steamboat’s former industrial enterprise zone.
That zone expired at the end of 2009. It was in place for about 20 years on Steamboat’s west side. More than 240 businesses with industrial enterprise zone licenses, as of late 2009, were exempt from paying city sales and use taxes on the purchase or sale of parts, equipment, machinery and tools.
City Manager Jon Roberts said that zone could provide a framework for the development of a citywide enterprise program.
City Council President Cari Hermacinski said an “evolving methodology” could be used to gauge future requests for financial incentives. That methodology could involve variables such as number of jobs created and square footage of expansion, she said.
“Wherever we go here, we have to treat this as a template and prototype for other businesses,” Councilman Kenny Reisman said about the ACZ incentive.
Liman said he plans to decide whether the expansion is feasible after Jan. 1 and, pending that decision, could start construction in March.
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