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08-17-2007 (WEDC) Minutes Minutes Wylie Economic Development Corporation Board of Directors Meeting Friday, August 17, 2007—6:00 A.M. Inwood National Bank— Conference Room 200 South Highway 78—Wylie,Texas CALL TO ORDER Announce the presence of a Quorum. President Fuller called the meeting to order at 6:15 a.m. Board Members present were: Mitch Herzog, John Yeager, Merrill Young, and Chris Seely. Staff present was Executive Director Sam Satterwhite and Administrative Assistant Gerry Harris. CITIZEN PARTICIPATION There being no citizen participation, President Fuller proceeded to Action Items. ACTION ITEMS ITEM NO. 1 — Consider and Act Upon Approval of the July 17, 2007 Minutes of the WEDC Board of Directors Meeting. MOTION: A motion was made by Mitch Herzog and seconded by John Yeager to approve the July 17, 2007 Minutes of the WEDC Board of Directors Meeting. The WEDC Board voted 5 — FOR and 0—AGAINST in favor of the motion. ITEM NO. 2 — Consider and Act Upon Issues Surrounding Approval of the July 2007 WEDC Treasurer's Report. MOTION: A motion was made by Merrill Young and seconded by Mitch Herzog to approve the July 2007 WEDC Treasurer's Report. The WEDC Board voted 5 —FOR and 0—AGAINST in favor of the motion. ITEM NO. 3 — Consider and Act Upon Issues Surrounding an Incentive Agreement Between the WEDC and Extruders division of Atrium Companies, Inc. According to the Incentive Agreement with Extruders division of Atrium Companies, Inc., in order to be eligible for the 2007 incentive payment associated with the Extruders paint line expansion, a minimum appraised value (combined real and personal property) of $22,948.935 must be present. Should the minimum appraised value exist at the site, the WEDC—Minutes July 17, 2007 Page 2 of 5 WEDC will pay$833 per every employee over and above a 420 employee benchmark, not to exceed 60 employees or $50,000. Extruders has an existing appraised value of real and personal property of$23,907,793. Due to a downturn in the housing market however, the current number of employees is 384. Based upon the requirements of the Incentive Agreement and the lack of any extenuating circumstances as determined by staff and confirmed by Extruders President Jamey Rentfrow, staff believes that the Board has no choice but to deny payment for 2007. Based on the Incentive Agreement, the Board may at its sole discretion terminate the Agreement along with any and all opportunities to receive the final incentive payment in 2008. Staff believes that Extruders should be notified that should the established benchmarks be met in 2008, Extruders will be eligible for the final payment of incentives up to a maximum of$50,000. Staff recommends that the WEDC Board of Directors deny payment to Extruders citing 'non attainment of obligations' as per the Incentive Agreement between the WEDC and Extruders. MOTION: A motion was made by Mitch Herzog and seconded by John Yeager to deny the 2007 incentive payment to Extruders division of Atrium with the understanding that Extruders is still eligible for the 2008 incentive payment should Extruders satisfy minimum requirements in 2008. The WEDC Board voted 5 —FOR and 0—AGAINST in favor of the motion. ITEM NO. 4—Consider and Act Upon Issues Surrounding JTM Technologies. Over the past two weeks, WEDC staff has been working with Mr. James Joyce and Mr. Tommy Pulliam to reduce costs associated with the JTM project within Premier Plaza. On August 14`h, staff received notification from Mr. Joyce indicating that the project would be abandoned. Staff believes that in addition to increased costs, at least two quarters of declining revenues have contributed to the cancellation of the project. From this point forward, the WEDC will be repurchasing the 2.01 acres back from JTM ($30,150) and returning monies associated with the Security Agreement ($13,650). Staff indicated to the Board that the only monies drawn on the loan from Chase are those associated with the architectural plans and civil engineering which were funded in the amount of±$45,000. Those monies returned for the repurchase of the 2.01 acres will more than likely be paid directly to Chase. President Fuller commented that while it is unfortunate that so much staff time has been expended on this project and the first anticipated project within Premier Plaza will not take place, it is much better to halt the project earlier in the process rather than JTM experience financial difficulties during construction or following completion. WEDC—Minutes July 17, 2007 Page 3 of 5 MOTION: A motion was made by John Yeager and seconded by Chris Seely to authorize President Fuller to execute all documentation necessary to effectuate the purchase of 2.01 acres from JTM Technologies for $30,150 and release $13,650 in earnest monies associated with the Security Agreement between JTM Technologies and the WEDC. The WEDC Board voted 5 —FOR and—AGAINST in favor of the motion ITEM NO. 5 — Consider and Act Upon Issues Surrounding the Relocation of Precision Wire Products to Premier Plaza. Staff reported that a company, Precision Wire Products, has expressed an interest in relocating from Dallas to Wylie. The company manufactures and assembles wire for various fasteners and clips used for overhead support of acoustical and drywall ceilings, along with electrical fixtures. Mr. Ricky Tonneson, part owner and Chief Operating Officer of Southern Fastening Systems of Texas, owns and operates Precision Wire in Dallas and its South Carolina operations as well. Currently the company occupies 12,860 square feet, and they propose the construction of a 20,000 square foot, tilt wall facility within Premier Plaza. The proposed facility has been quoted at $1.3 million by Tommy Pulliam which staff believes to be a reliable number based upon the recent quotes for JTM. Staff has indicated to Mr. Tonneson that there would be a cost for the lot based upon WEDC development cost and the level of Precision investment. Staff proposed a $30,000 cost participation, with a closing following a loan commitment and approval and approval of a building permit. After determining lot size, Board input on cost participation, financing options for Precision, need for replatting, and City approval, Staff can draft a Letter of Intent. Board directed Staff to research the various options and begin a draft of the Letter of Intent to bring before the Board. ITEM NO. 6— Consider and Act Upon Issues Surrounding a Real Estate Sales Contract Between the WEDC and Prime Kuts, Distributing Inc. Staff presented for review the survey and Real Estate Sales Contract between Prime Kuts Distributing, Inc. and the WEDC. Staff has ordered a Phase I Environmental Study on the facility which will be complete on August 20t. A Phase II was not ordered due to the fact that the site is 100% concrete. The Lease contemplated in the Contract has not been completed. Staff has hired Jim Gahl, President of Architect Incorporated to assist the WEDC in determining alternative uses of the 4,550 square foot facility should the WEDC lease the building out following the departure of Prime Kuts. Staff will be taking the issue to the City Council for approval on 8-28-07. WEDC—Minutes July 17, 2007 Page 4 of 5 No action was taken. ITEM NO. 7—Consider and Act Upon Issues Surrounding a Real Estate Sales Contract Between the WEDC and Martin L. Anderson. Staff presented for review the Real Estate Sales Contract between Martin L. Anderson and the WEDC. Staff has ordered a Phase I and a limited Phase II Environmental Study on the property which will be complete on August 27`h. The Phase II was ordered immediately based upon the prior use of the property as railway right-of-way. The survey of the 0.114 acre tract will be complete August 22nd Staff will be taking the issue to the City Council for approval on 8-28-07. No action was taken. ITEM NO. 8 — Consider and Act Upon Issues Surrounding a Real Estate Contract between the WEDC and Martin L. Anderson, Susan M. Anderson, Gary E. Bowland, and Charlotte A. Bowland. Staff presented for review the Real Estate Sales Contract between Martin L. Anderson, Susan M. Anderson, Gary E. Bowland, and Charlotte A. Bowland and the WEDC. Staff has ordered a Phase I and a limited Phase II Environmental Study on the property which will be complete on August 27`h. The Phase II was ordered immediately based upon the proximity of the site to the chemical Recycling, Inc. site. The Survey of the site is completed. The Feasibility Period will expire on 9-29-07 with closing on 10-28-07. Staff will be taking the issue to the City Council for approval on 8-28-07. EXECUTIVE SESSION The WEDC Board of Directors convened into Executive Session at 7:02 a.m. I. Consider and Act Upon Issues Surrounding the Purchase of Property Located Near the Intersection of Jackson and Marble as Authorized in Section 551.072 (Real Property) of the Local Government Code, Vernon's Texas Code Annotated (Open Meetings Act). II. Consider and Act Upon Issues Surrounding the Purchase of Property Located Near the Intersection of Industrial Court and Birmingham Street as Authorized in Section 551.072 (Real Property) of the Local Government Code, Vernon's Texas Code Annotated (Open Meetings Act). III. Consider and Act Upon Issues Surrounding the Purchase of Property Located Near the Intersection of Cooper Drive and F.M. 544 as Authorized in Section 551.072 (Real WEDC—Minutes July 17, 2007 Page 5 of 5 Property) of the Local Government Code, Vernon's Texas Code Annotated (Open Meetings Act). IV. Consider and Act Upon Issues Surrounding Personnel Matters (Evaluation of the WEDC Executive Director) as Authorized in Section 551.074 of the Local Government Code, Vernon's Texas Code Annotated (Open Meetings Act). V. Consider and Act Upon Issues Surrounding the Development of a 2.26 Acre Tract within Premier Plaza to Support the Development of a Light Industrial Facility as Authorized in Section 551.087 (Economic Development Negotiations) of the Local Government Code, Vernon's Texas Annotated (Open Meetings Act). RECONVENE INTO OPEN MEETING The WEDC Board of Directors reconvened into open session at 7:50 a.m. ADJOURNMENT With no further business, President Marvin Fuller adjourned the WEDC Board meeting at 7:51 a.m. dArhi- l & iV Marvin Fuller, President ATTEST: Samuel D.R. Satterwhite Executive Director