01-20-2017 (WEDC) Minutes Minutes
Wylie Economic Development Corporation
Board of Directors Meeting
Friday, January 20, 2017—6:30 A.M.
WEDC Offices—Conference Room
250 South Highway 78—Wylie, Texas
CALL TO ORDER
Announce the presence of a Quorum
President Marvin Fuller called the meeting to order at 6:33 a.m. Board Members present were John
Yeager, Todd Wintters, and Demond Dawkins.
Ex-officio member Mindy Manson, City Manager was present.
WEDC staff present was Executive Director Sam Satterwhite, Assistant Director Jason Greiner and
Senior Assistant Angel Wygant.
CITIZEN PARTICIPATION
With no citizen participation, President Fuller proceeded to Action Items.
ACTION ITEMS
ITEM NO. 1 — Consider and act upon approval of the January 9, 2017 Minutes of the Wylie
Economic Development Corporation (WEDC) Board of Directors Meeting.
MOTION: A motion was made by Todd Wintters and seconded by
John Yeager to approve the January 9, 2017 Minutes of the Wylie Economic
Development Corporation. The WEDC Board voted 4 —FOR and 0 —AGAINST
in favor of the motion.
ITEM NO. 2—Consider and act upon approval of the December 2016 Treasurers Report.
An updated Balance Sheet that reflected the handwritten entries provided in the original Board Packet
was distributed to Board Members. Clarified items included Inventory, Deferred Outflows, and
Deposits. Staff reviewed key items within the December 2016 Treasurers Report.
MOTION: A motion was made by Demond Dawkins and seconded by
John Yeager to approve the December 2016 Treasurers Report for the Wylie
Economic Development Corporation as amended. The WEDC Board voted 4 —
FOR and 0—AGAINST in favor of the motion.
ITEM NO. 3—Consider and act upon issues surrounding the WEDC 2016 Annual Report.
As per the By-laws, the WEDC must present an annual report to the Wylie City Council no later than
January 31 st of each year. The report must include, but is not limited to, a review of all expenditures
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January 20, 2017
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made by the Board, a review of accomplishments, and a review of other than direct economic
development. Staff presented that the report provided to the Board met the intent of the requirements of
the By-laws with the same being presented to the Wylie City Council on January 24, 2017.
Staff recommended that the WEDC Board of Directors approve the 2016 WEDC Annual Report as
presented by staff and recommended it be presented to the Wylie City Council.
MOTION: A motion was made by John Yeager and seconded by
Todd Wintters to approve the 2016 WEDC Annual Report as presented by staff for
presentation to the Wylie City Council on January 24, 2017. The WEDC Board
voted 4—FOR and 0—AGAINST in favor of the motion.
ITEM NO. 4 — Consider and act upon a Performance Agreement between KREA, LLC and the
WEDC.
Staff reminded the Board that it had reported multiple times that it did not appear that KREA would
complete the La Quinta Inn& Suites by March 31,2017 as required within the Performance Agreement.
Mr.Kash Parbhu,Manager of KREA,has requested a 30-day extension of the deadline to April 30,2017.
As with the REVA Hospitality amendment considered earlier by the Board, staff recommended that the
Board amend the deadline an additional 30 days from the requested date to May 31' to allow for any
other unforeseen delays. If approved, staff will convey to Mr. Parbhu that any further request for
extension may be viewed as `beyond reasonable' as the Performance Agreement was executed on July
29, 2015.
Staff recommended that the WEDC Board of Directors approve the First Amendment to a Performance
Agreement extending the date by which KREA,LLC must complete improvements associated with a La
Quinta Inn& Suites to May 31, 2017.
President Fuller inquired as to the timing of the funding for the KREA Agreement. Staff responded that
an amount equal to the occupancy taxes generated by the project will be reimbursed to KREA beginning
six months from the issuance of a certificate of occupancy as the Start Date within Section 1 (b) of the
Agreement. The six-month delay was put in place originally to allow for a lag in sales associated with
the startup of any business. Mr. Fuller suggested that the Start Date be reduced to four months to allow
for the delay and requested extension. The general consensus of the Board agreed with Mr. Fuller.
MOTION: A motion was made by Todd Wintters and seconded by
Demond Dawkins to approve the First Amendment to a Performance Agreement
extending the date by which KREA, LLC must complete improvements associated
with a La Quinta Inn&Suites to May 31,2017,and further amending the Start Date
to four months after the issuance of a certificate of occupancy. The WEDC Board
voted 4—FOR and 0—AGAINST in favor of the motion.
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January 20, 2017
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ITEM NO. 5—Consider and act upon a Performance Agreement between the WEDC and Ronald
P. and Carole A. Trout.
Mr. Trout initially came to the WEDC in an attempt to evaluate options surrounding the construction of
a 4,944 square foot commercial building near N. Highway 78 and Eubanks Lane. Mr. Trout plans to
construct a new building for a tenant on land behind an existing car wash. Following direction from the
WEDC Board in Executive Session and an oral commitment by the WEDC staff for assistance, Mr.
Trout moved forward with design and engineering plans.
Trout has an estimated construction budget of$340,000 for Phase I (4,944 square feet). Future plans
may include a Phase II of approximately 5,700 additional square feet. Helmberger Associates has been
working with Mr. Trout to develop construction plans and an overall construction budget. Should the
project move forward, construction will begin within the first quarter of 2017 with an estimated
completion date in the third quarter of 2017.
The attached Agreement proposed a total maximum incentive of $15,000 which is broken down as
follows:
Incentive No. 1 ..................................................................... $15,000
➢ Construction of 4,944 square feet
➢ Expenditures verified at $340,000
➢ Proof of Certificate of Occupancy by December 31, 2017
Staff commented that based upon approximately $7,500 in new revenue generated from the project in
City and ISD taxes, the project will have a two-year return on investment. Further, should Ronald P.
and Carole A. Trout fail to meet the Performance Measures for Incentive No. 1,the entire Performance
Agreement is voided in advance. Further, no partial incentive payments will be provided.
Staff recommended that the WEDC Board of Directors approve a Performance Agreement between
WEDC and Ronald P. and Carole A. Trout providing for a maximum incentive of$15,000 and further
authorizing the WEDC Executive Director to execute said Agreement.
MOTION: A motion was made by John Yeager and seconded by
Todd Wintters approving a Performance Agreement between the WEDC and
Ronald P. and Carole A. Trout. The WEDC Board voted 4 — FOR and 0 —
AGAINST in favor of the motion.
ITEM NO. 6 — Consider and act upon issues surrounding the construction of parking
improvements on WEDC property located at 111 N. Ballard.
The WEDC purchased a 0.2-acre tract from First Baptist Wylie (FBW) in June of 2016. As previously
discussed, the best short-term use for this property would be to create a parking lot for visitors to
Downtown. The first option would be to utilize an exit into the FBW parking lot. FBW is agreeable
with the understanding that they would be able to utilize the public parking for their congregation.
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January 20, 2017
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The second option would be to pave the alley that runs behind Mr. Conkle's metal building. This option
would require relocating the utility poles and 3 transformers to the back of the property which staff
previously believed to be a 6-figure proposition. However, staff has received a verbal quote from Oncor
in the amount of$25,000. This number does not include relocating phone lines attached to the utility
poles which would be an additional cost. Tentative cost estimates for Option 1 utilizing the FBW parking
lot exit would be $105,000, and Option 2 with a dedicated entrance via the alleyway is estimated at
$140,000.
The WEDC Board indicated that it preferred relocating the utility poles and transformers to the back of
the property and paving the alleyway which would provide improved ingress/egress and not take away
parking spaces in the FBC lot. Further,while the second design option is more expensive,it does correct
a poor utility design and location of poles. Staff requested that this item be tabled until the next Regular
Meeting of the WEDC to provide time to gather the appropriate bids and cost estimates to present to the
Board.
MOTION: A motion was made by John Yeager and seconded by
Demond Dawkins to TABLE this item for consideration at the next Regular
Meeting of the WEDC Board of Directors. The WEDC Board voted 4—FOR and
0—AGAINST in favor of the motion.
DISCUSSION ITEMS
ITEM NO. 7— Staff report: review issues surrounding WEDC Performance Agreement Summary, the
Wedge Corporation, Environmental Activity Summary, REVA Hospitality, Highway 78 WEDC Pad
Sites, Peddicord Center, WEDC Lease Properties, Promotional Activities, and regional housing starts.
WEDC Performance Agreement Summary
Attached for the Board's review was a summary of all outstanding Performance Agreements including:
ACG Texas LP, Ascend Custom Extrusion, All State Fire Equipment, B&B Theatres Operating
Company, Clark Street Development, Dank Real Estate, Exco Extrusion Dies, FLM Development,
Freudiger Holdings, Getset, KREA Acquisition, McClure Partners, Patna Properties, VIAA Properties,
Von Runnen Holdings, Wedge Corporation, Woodbridge Crossing, and Wylie Flower& Gift.
Woodbridge Crossing
Attached for the Board's review was the Sales Tax Reimbursement Report which identifies all sales
taxes received through December 2016 within Woodbridge Crossing for the City General Fund, the
WEDC, and the 4B. As a reminder, the City and WEDC reimbursed 85% of all sales tax generated
within Woodbridge Crossing through September 2013 with the reimbursement percentage reduced to
65% thereafter. Due to the default under the Amended and Restated Performance Agreement,
Woodbridge Crossing is only eligible to receive up to $6 million in sales tax reimbursement through
September 2021 as opposed to the maximum reimbursement of$12 million originally contemplated.
$3,962,373 in reimbursement has been earned through December 2016 with net receipts of$3,186,843
after reimbursements.As well,it is estimated that$4.1 mm has been paid in ad valorem taxes to the City
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January 20, 2017
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of Wylie (excluding the WISD). As shown on the Sales Tax Reimbursement Report, $104,436 was
generated in sales tax in October 2016 versus $97,528 in October 2015. This represents 7.08%increase
over 2015 receipts.
The Wedge Corporation
The Wedge Corporation qualified for a second Performance Credit under its Performance Agreement
with the WEDC. A loan was entered into between The Wedge and WEDC under which Economic
Incentives were provided for the completion of qualified infrastructure associated with the development
and ongoing operation of The Rock Wood Fired Kitchen. The Loan was also secured by Guaranty
Agreements from The Wedge Principals, Jay Gigandet and Don Bellis, which were previously released
under the terms of the Agreement.
W&MActivity Report
Attached for the Board's review was a spreadsheet tracking all activities with W&M Environmental for
FY 2014-15 and FY 2015-16. W&M has prepared Phase I&II reports for Mann Made,K&M,Business
Way, 111 N. Ballard, 908 Kirby, 201 Industrial Court, is processing the VCP application for the
Commerce property, and processing the Municipal Setting Designation through the City.
REVA Hospitality—Holiday Inn Express
The Feasibility Period for the property acquisition on Sanden expired on 1-17-17 with closing still set
for February 1st. As well, civil and site plans along with a preliminary plat has been submitted to the
City of Wylie and is attached for your review.
Highway 78 WEDC Pad Sites
Helmberger Associates is evaluating bids for median and driveway improvements which should be
finalized by January 27th. Staff is also working closely with Oncor Electric to determine the most
effective way to serve the site. The current goal is to secure an overhead utility easement from the
adjacent Baylor property to the west. Staffs goal is to secure the easement by January 27th as well.
Peddicord Center
The Wylie City Council has determined that it will not continue its lease of the Bart Peddicord Center
from the WEDC. Staff sought direction for the Board in terms of information needed to make a decision
on the future use, if any, of the structure.
The WEDC is in receipt of$61,924 from TML in insurance proceeds from the hail claim. An additional
$43,960 is available in depreciation and code upgrades should the WEDC choose to repair the building.
Damages to the building included paint, ceiling tiles, insulation, dry wall, roofing, HVAC, windows,
lighting fixtures, and ductwork. If the building is demolished now or in the future, those costs are
estimated at $28,000.
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January 20, 2017
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The Board requested information regarding the expiration of the time frame to claim depreciation should
the Board choose to repair the building and wish to claim depreciation funds. Staff committed to research
and report to the Board at the next meeting.
Promotional Activities
As reported regularly,the WEDC has a '/a interest in Maverick's Season tickets for the 2016-17 Season.
A spreadsheet tracking the use of those tickets was attached for the Board's review.
Regional Housing Starts
Thirty-nine homes were permitted in Wylie for the month of December 2016 bringing the annual total
to four hundred nine. Sachse, Lavon, Murphy permitted a combined twelve over the same period.
Inspiration permitted two homes in December and one hundred sixty-four for the year.
No action was requested by staff for this item.
EXECUTIVE SESSION
Recessed into Closed Session at 7:41 a.m. in compliance with Section 551.001, et.seq. Texas Government
Code, to wit:
Section 551.072 (Real Estate) of the Local Government Code, Vernon's Texas Code Annotated (Open
Meetings Act). Consider the sale or acquisition of properties located near the intersection of:
• Highway 78 & Cooper
• Cooper&F.M. 544
Section 551.087 (Economic Development) of the Local Government Code, Vernon's Texas Code
Annotated (Open Meetings Act).
• Project 2015-12a
• Project 2016-6a
• Project 2016-10a
• Project 2017-la
RECONVENE INTO OPEN MEETING
The WEDC Board of Directors reconvened into open session at 8:35 a.m. and took no action.
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January 20, 2017
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ADJOURNMENT
With no further business,President Fuller adjourned the WEDC Board meeting at 8:35 a.m.
1,1
Marvin Fuller,President
ATTEST:
Samuel Satterwhite,Director