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HomeMy WebLinkAboutMinutes_GEDCO_03.15.2010Minutes of the Meeting of the Georgetown Economic Development Corporation and the Governing Body of the City of Georgetown, Texas Monday, March 15, 2010 The Georgetown Economic Development Corporation of the City of Georgetown, Texas, met on Monday, March 15, 2010. Members Present: Ben Oliver, Dale Ross, Pat Berryman, John Marler, John Kiltz Members Absent: Staff Present: Paul Brandenburg, General Manager, Laurie Brewer, Assistant Director of Finance and Administration, Mark Thomas, Economic Development Director, Shirley Rinn, Executive Assistant to the City Manager, Elizabeth Cook, Director of Community Development, Bill Sattler, Councilmember, District 4 Minutes Regular Meeting the meeting was called to order at 2:05 p.m. A. Consideration and possible action to elect officers to include President, Vice -President and Secretary —Paul E. Brandenburg, General Manager Motion by Ross, second by Oliver to nominate Pat Berryman for President. Approved 4-0 (Marler Absent). Motion by Berryman, second by Kiltz to nominate Dale Ross as Vice President. Approved 4-0 (Marler Absent). Motion by Oliver, second by Ross to nominate John Kiltz as Secretary. Approved 4 0 (Marler Absent). B. Discussion and possible action regarding the Project Progress Report, including Hope Lumber Company, Citigroup, Vista Solutions, Loading Dock, Airborn, Orthopeutics, The Beauty Escape Salon, Texas Outdoor Power Company, Enflite, McIntosh Holdings, LLC, Amante, Quantum Logic Devices, Rmgdale, Radix BioSolutions-- Mark Thomas, Economic Development Director and Paul E. Brandenburg, General Manager Thomas told the Board that there were no major changes to the update. Thomas explained the purpose of the Project Report for the benefit of the new members. Discussion amongst the Board regarding same. C. Consideration and approval of the minutes from the Regular Board Meeting held Monday, February 9, 2010 -- Ben Oliver, Secretary Motion by Ross, second by Oliver to approve the minutes from the Regular Board Meeting held Monday, February 9, 2010. Approved 4-0. (Marler Absent) D. Consideration of the February 28, 2010 Financial Reports--Micki Rundell, Finance Manager Laurie Brewer provided the Board an overview of the Financial Reports, including monthly sales tax revenues, monthly expenditures, budgetary report, and other relevant financial information. There was a brief discussion regarding sales tax collections. She also confirmed that the GEDCO Board had S2.744 million available for project funding. John Marler arrived at 2:20pin E. Discussion and possible action regarding the approval of a Performance Agreement between GEDCO and McIntosh Holdings, LLC in an amount not to exceed $14,000 for electrical improvements --Paul E. Brandenburg, General Manager Brandenburg provided an overview of the request. He told the Board that he has not received the requested backup invoices for the specific work that was done from Mr. McIntosh. The Board recommended that this item be postponed until we receive the backup invoices . He also told the Board that the landscaping issue has still not been completely resolved. There was further discussion regarding the landscaping issues. Motion by Berryman, second by Marler to postpone the discussion regarding this item until the proper backup invoices are received and the landscaping issues are resolved. Approved 5-0. Discussion and possible action regarding the approval to negotiate a Performance Agreement between GEDCO and McIntosh Holdings, LLC in an amount not to exceed S249,000 toward the cost to build out the balance of the office space located at the Georgetonian Office Building located at 205 West University Street-- Paul E. Brandenburg, General Manager GEDCO Minutes/March 15, 2010 Page 2 of 5 Thomas provided an overview of the request. He told the Board that this item is similar to one that will be discussed in Executive Session regarding the build -out of office space, which is needed in Georgetown. He told the Board that legal counsel, Jeff Moore indicated that this proposal appears to be a proper use of 4A funding. He told them that in the past, funding has been done for public infrastructure and this request goes inside the walls of a building and it is at the Board's discretion as to whether to provide funding for this type of request or not. He told the Board that in past we have prepared a matrix to determine the value of the mcentive, but that the matrix has not been done on this particular request yet. The Board discussed the need to determine what an incentive is and what is not an incentive with regard to this type of request. Thomas told the Board that the applicant was told that he that he should use his own jobs created for for his own business in this request and not those jobs created by potential companies located in this building, because those other companies might want to approach the Board requesting funding based on its own jobs. Thomas also told the Board that with the jobs created by McIntosh Holdings plus the capital improvements made to the site, this proposal would probably meet the criteria of a project under the letter of the law for the GEDCO Board. There was further discussion regarding retained vs. new jobs, as well as the fact that there is not very much office space available in Georgetown, and this project is one of the few that does. Discussion was also held as to whether the Board should approve any project for this developer as long as the landscaping issues are still outstanding. City staff provided the Board with an update on the progress to resolve those issues, but did confirm that a landscaping plan has not been approved. There was additional discussion regarding the best way to structure the agreement for this project. The Board discussed utilizing a buy -down based on public investment and the incentives not being paid until specific projects were confirmed to locate at the site. lhe incentives would only be triggered when the project was confirmed with a potential total of approximately S250,000 being available. There was further discussion regarding the possibility of paying the incentives based on the square footage of the improvements for reduced rent. There was an indication that some of the Board Members were not aware that the 2nd floor of the building was not built -out. They had been under the impression that the discussions in the past regarding this project gave the impression that the requests for incentives were tied to the whole project and not part of a project. The Board also discussed the total amount of funding that the GEDCO Board should consider committing to this project. The Board asked staff to formulate and structure a proposal utilizing incentives based on the square footage of the improvements tied to a reduction in rent. GEDCO Minutes/March 15, 2010 Page 3 of 5 An overview was presented by one of the Board Members regarding GTEC's experience when Mr McIntosh brought his request for incentives related to public infrastructure. The GTEC Board had approved the request, but the City Council voted to deny the funding. There was more discussion regarding the developer's perception that the City is not willing to work with hint on his requests related to this project. The Board discussed the difficulty developers face for any type of development in Old Town and acknowledged. that this developer has been willing to develop in this area despite the challenges. The Board indicated that it was prudent to offer incentives to attract developers and businesses to locate and do business in Georgetown. There was additional discussion regarding the difficulty in working through the issues related to this particular project because the incentives were not requested prior to the start of the development, but rather after the construction began. The board reiterated that they wanted to work with the developer on this project, but that any agreement that is formulated will need to be based on vetted numbers and full disclosure and transparency with regard to the project. I'he Board indicated that it would not be in a position to vote on this as it is presented today. Motion by Berryman that the GEDCO Board is willing and interested in formulating an agreement based on vetted numbers and accurate information regarding the project, and more details as to where and how the proposed S775,000 investment is going to be spent (i.e. source and use of funds) and the GEDCO Board will discuss the amount that it would consider awarding to the project based on the outcome of that determination, and in return, the GEDCO Board would need to see reimbursements for rent that can be used for Economic Development in the community; This structure being necessary because of the strict requirements of the laws pertaining to the use of Economic Development sales tax as incentives for Fconomic Development. I'he Board discussed this further clarifying that if the vetted figure was determined to be S775,000, then the S250,000 request would be a feasible incentive request to work with. It the vetted figure was different then other amounts might be considered. There was further discussion that the Board could not approve the request in its current format, and that the agreement must be party to party and that not include conditions that include participation from third parties. Phis would impede the Board's ability to work with other companies if they wanted to request incentives from the GEDCO Board in the future. It was determined that the Board should postpone a vote on this item until staff has had the opportunity to convey the Board's position to the developer and more information is obtained as discussed previously. GEDCO Minutes/March 15, 2010 Page 4 of 5 Recessed into Executive Session at 2:55 p.m. EXECUTIVE SESSION: The Georgetown Economic Development Corporation will meet in closed executive session as allowed by Texas Open Meetings Act (Texas Government Code Chapter 551), as follows: G. Section 551.072. DELIBERATION REGARDING REAL PROPERTY Discussion and possible action to deliberate the purchase, exchange, lease or value of real property for purposes authorized by the Development Corporation Act which discussion in open session would have a detrimental effect on negotiations with third persons. --Discussion and possible action regarding the Land/Infrastructure project negotiations. H. Section 551.087. DELIBERATION REGARDING ECONOMIC DEVELOPMENT NEGOTIATIONS. Deliberation regarding commercial or financial information that the corporation has received from a business prospect that the Georgetown Economic Development Corporation seeks to have locate, stay, or expand in or near the territory of the City of Georgetown and with which the Corporation is conducting economic development negotiations; and/or deliberation regarding the offer of a financial or other incentive to a business prospect that the Corporation seeks to have locate, stay, or expand in or near the territory of the City of Georgetown. --Discussion and possible action for incentives regarding the Albertson's Building. L Section 551.071. CONSULTATION WITH ATTORNEY Consultation with attorney regarding legal issues related to agenda items and other matters in which the duty of the attorney to the Georgetown Economic Development Corporation under the Texas Disciplinary Rules of Professional Conduct of the State Bar of Texas. Recessed out of Executive Session at 3:30pnt J. Action out of Executive Session No Action out of Executive Session. Adjourned at 3:3 Pat Berryman, Presid John Kil ', Corporat ,,Secretary GEDCO Minutes/March 15, 2010 Page5of5