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HomeMy WebLinkAboutMinutes_GEDCO_08.20.2012Minutes of the Meeting of the Georgetown Economic Development Corporation and the Governing Body of the City of Georgetown, Texas Monday, August 20, 2012 The Georgetown Economic Development Corporation of the City of Georgetown, Texas, met on Monday, August 20, 2012. Members Present: Rachael Jonrowe, Tommy Gonzalez, Bill Sattler, Jolm Mader Members Absent Hugh Brown Staff Present: Paul E. Brandenburg, General Manager, Mark Thomas, Economic Development Director, Shirley Rinn, Executive Assistant, Laurie Brewer, Deputy City Manager, Micki Rundell, Finance Manager, Bridget Chapman, Acting City Attorney, Michael Seery, Shelley Hargrove, Main Street Manager Regular Meeting Called to order at 1:00 p.m. A. Discussion and possible action regarding the Project Progress Report, including Airborn, Enflite, Radix BioSolutions, Lone Star Circle of Care, Grape Creek Winery, Georgetown Winery, and Difusion Technologies, Inc. -- Mark Thomas, Economic Development Director and Paul E. Brandenburg, General Manager. Thomas told them that DiFusion has been funded. B. Consideration and approval of the minutes for Georgetown Economic Development Corporation for the Regular Meeting held Monday, June 25, 2012—Rachael Jonrowe, Secretary Motion by Gonzalez, second by Marler to approve the minutes for Georgetown Economic Development Corporation for the Regular Meeting held Monday, June 25, 2012 (Approved 4 0) (Brown Absent) C. Consideration of the July 31, 2012 Financial Reports--Micki Rundell, Finance Manager Rundell provided a detailed report on makeup of the city's sales tax. Sales tax figures are down for month of June. Several businesses reported in May instead of June. Expenditures were related to marketing and Grape Creek. D. Consideration and possible action to approve the GEDCO 2012/13 Budget--Micki Rundell, Finance Manager Rundell provided an overview of the proposed budget for 2012/13. She clarified that Difusion would come out of FY 2011-12 Budget and that this item will go to the City Council on September 11, 2012. Motion by Gonzalez, second by Sattler to approve the GEDCO 2012/13 Budget. (Approved 4-0) (Brown Absent) E. Consideration and possible action regarding the Administrative Services Contract between the City of Georgetown and the Georgetown Economic Development Corporation --Micki Rundell, Finance Manager Rundell provided an overview of the contract. Motion by Jonrowe, second by Gonzalez to approve the Administrative Services Contract between the City of Georgetown and the Georgetown Economic Development Corporation (Approved 4-0) (Brown Absent) F. Discussion and possible action regarding the costs of structural work and remediation on the former visitors' center building — Mark Thomas, Economic Development Director Thomas provided an overview of the history of what the community wanted to see in the Downtown Area and what the City and GEDCO could do to help promote the downtown, as wellas an overview of the initial discussions relating to the costs of renovating the Fire Station Bays and the negotiations related to the potential buildout of that facility for a winery. He told the board that $550,000 was set aside to utilize to bring a winery to Georgetown. Thomas told the Board that GEDCO contracted with Gene Richards to market the City for another Winery with potential interest to locate to Georgetown . As part of that marketing campaign, Grape Creek Winery was determined to be one of the top wineries in the State and that Grape Creek has had a huge impact on Fredericksburg. The owner of Grape Creek came to Georgetown and observed the square and were interested in possibly locating in Georgetown, but determined that the Fire Station Bays would not work, but that they would be interested in the Visitor's Center. Thomas went on to provide an overview of the initial budget for renovating the Visitor's Center and as work commenced, it was determined that there were additional structural and buildout costs for renovating the Visitor's Center that originally anticipated. He went over the bid that was received by B.O. Construction. He told the Board that Grape Creek has now asked for the items that are outlined in the base bid as well as alternate additional items (i.e. sound system, granite countertops, and patio enhancements). There was discussion related to this request, and the Board wanted to know if the amount itemized in the budget was the final amount that would be asked of the Board to fund for this project? Thomas told the Board that Grape Creek has also asked for the repair and /or replacement of the roof within two years, which is an open ended item that is not reflected in the budget presented to the Board with this item . GEDCO Minutes/August 20, 2012 Page 2 of 5 There was more discussion regarding how the enhancements will increase the value of the building and the concern of how much it will be worth when it is completed. The concern is that if Grape Creel< sells it later they will have a building that will be worth twice what it is now. The Board also discussed the intangible investment in the concept and not just the bricks and mortar and how this project will enhance the momentum on the square. There was more discussion regarding the amount of time and work that the City and GEDCO have done to get this building ready, including the relocation of Visitors Center, the reinforcement of the floor, and a discussion as to where does it stop? There was concern among the Board members that some of the items requested are wish list items and not necessarily items that are needed to make the building ready for occupancy . Thomas told the Board that there is not another winery lined up after this one. He indicated that if this project wasn't completed, the City would have to start over on its marketing process. The Board went on to discuss whether it would support the base bid in lieu of the alternate items. They also discussed how the Return on Investment didn't work from the beginning of the negotiations for this project because of the intangible nature of this deal . It was about bringing a wine cluster to the community. Thomas told the Board that part of what the City/GEDCO was getting out of this project was the "Grape Creek" brand. The Board indicated that it has always supported this project; however, the items that have been asked to enhance the project are not necessary to structurally get the building ready for occupancy. Thomas told the Board that Grape Creek estimates it will invest $250,000 to get the winery up and running in addition to what GEDCO has invested to get the building ready. There was also additional discussion regarding whether the roof really needed to be replaced or whether a repair was sufficient, and that any building owner normally retains the risk that a roof may be need to be replaced at some point of ownership . There was more Board discussion regarding the minimal risk that Grape Creek has with this deal because of what they are getting in the building. The building will be much more valuable when everything is completed. GEDCO Board is fully committed to making the building habitable and structurally sound, including the roof - whether it is repairable or needs to be replaced . However, the Board does not feel that the alternate items should be included . Accordingly the Board Recommendations include: 1 Repair/Replace the roof; 2 Only cover the costs to make the building structurally sound; 3. Extra alternate items are not to be included. Brewer provided a description of the items outlined in the Reconciliation for the total project, and there wi s more discussion regarding the intangibles that Grape Creek brings to GEDCO Minutes/August 20, 2012 Page 3 of 5 benefit the City, and the process and timeline for negotiations and taking the Agreement to Council for final. approval. G. Consideration and possible action to approve the Fourth Amended Agreement, Amended Lease Agreement and Promissory Note by and between GCV Enterprises, LLC dba Grape Creek Vineyards and the Georgetown Economic Development Corporation (GEDCO) — Mark Thomas, Economic Development Director Discussion regarding amending the Agreement based on the terms based on discussion in Item F, including the removal of the alternate items and adding $10,000 plus 15% contingency on actual cost of roof replacement Motion by Marler second by to Gonzalez to approve the Fourth Amended Agreement, Amended Lease Agreement and Promissory Note by and between GCV Enterprises, LLC dba Grape Creek Vineyards and the Georgetown Economic Development Corporation (GEDCO) in accordance with the terms as discussed in Item F, including the base bid to complete the structural items, less the amount for the alternate items, plus the cost of the replacement of the roof (not to exceed $11,500). (Approved 4-0)(Brown Absent) H. Discussion and possible action regarding a request from the Georgetown Independent School District in an amount not to exceed $200,560 for an equipment grant for the Engineering Laboratories at Georgetown and Eastview High Schools (GISD)--Paul E. Brandenburg, General Manager Thomas introduced Phil Timmons, Director of Career and Technology with GISD. Mr. Timmons provided an overview of the certification process that GISD is going to utilize with this program. He told the Board that it is open to the public and certified. There was discussion regarding the criteria necessary to approve this program and the importance of having a program to meet the need to provide skilled workers for companies in need of machinist, as well as discussion that this program will be a premiere program. The Board went on to discuss a requirement that GISD provide a report each year and that it try and ensure that least one student is placed with a local company each year. There was additional discussion regarding partnership with local companies to place students. GISD told the Board that it does have an Advisory Board that meets with local companies at least a couple of times per year to provide input for the program parameters. GISD has hired two additional staff to work with this engineering program, and Dan Weyent provided an overview and description of what is offered with the current program . Motion by Jonrowe second by Marler to approve a request from the Georgetown Independent School District in an amount not to exceed $200,560 for an equipment grant for the Engineering Laboratories at Georgetown and Eastview High Schools (GISD) (Approved 4-0) (Brown Absent) Motion to Adjourn (Approved 4-0) (Brown Absent) GEDCO Minutes/August 20, 2012 Page 4 of 5 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: 1. 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. J. 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. K. 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. L. Action out of Executive Session Executive Session was not held, therefore, there were no action items. Meeting was adjourned at 2:15 p.m. Attest: achae • 44 4 Jonrowe, Corp retary CMS JoldiMarler, President GEDCO Minutes/August 20, 2012 Page 5 of 5