04-24-2008 (WEDC) Minutes Minutes
Wylie Economic Development Corporation
Board of Directors Meeting
Thursday,April 24,2008—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 6:00 a.m. Board Members present were: John
Yeager, Mitch Herzog,and Chris Seely.
Staff present was Executive Director Sam Satterwhite and Administrative Assistant Gerry Harris.
Ex-Officio Board Member Mindy Manson was present.
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 March 20, 2008 Minutes of the
WEDC Board of Directors Meeting.
MOTION: A motion was made by Mitch Herzog and seconded by John Yeager to
approve the March 20, 2008 Minutes of the WEDC Board of Directors
Meeting. The WEDC Board voted 4—FOR and 0—AGAINST in favor of
the motion.
ITEM NO. 2 — Consider and Act Upon Approval of the March 2008 WEDC Treasurer's
Report.
MOTION: A motion was made by Chris Seely and seconded by John Yeager to
approve the March 2008 WEDC Treasurer's Report. The WEDC Board
voted 4—FOR and 0—AGAINST in favor of the motion.
ITEM NO. 3 —Consider and Act Upon Approval of a Budget Transfer for the WEDC FY
2007—2008 Budget.
Staff presented budget transfers to Advertising ($2,000), Rental ($500), Audit and Legal
Services ($10,000), and Longevity Pay ($20.00). To offset increased expenses, staff
recommended that Communications be reduced by $500.00, Travel & Training be reduced by
$8,000.00, Engineering-Architect be reduced by $2,000.00, Special Services be reduced by
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April 24,2008
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$2,000.00 and Hospital & Life Insurance be reduced by $20.00. Using these accounts, staff
avoided the use of the Incentives Account which has been customary practice.
Staff recommended that the WEDC Board of Directors authorize a Budget Transfer Request in
the amount of$12,520.00.
MOTION: A motion was made by John Yeager and seconded by Chris Seely to
approve a Budget Transfer in the amount of$12,520.00. The WEDC Board
voted 4—FOR and 0—AGAINST in favor of the motion.
ITEM NO. 4 — Consider and Act Upon Issues Surrounding a Contract for Sale of Real
Estate Between the Kansas City Southern Railway company and the WEDC.
Staff reviewed a real estate contract presented to the WEDC by the Kansas City Southern
Railway Company (KCS) to formalize the purchase of a portion of Lot 16, Block A of Wylie
Industrial Park. Staff estimated the area to be purchased at 0.3055 acre out of a 0.458 acre tract.
The purchase price per the LOI and contract is$3.25 per square foot.
WEDC Counsel(Mr. Randy Hullett) reviewed the documents and made the following comments
pertaining to issues not typical to standard contracts. The cost of providing the survey is solely
at the expense of the WEDC. The title policy is at the sole expense of the WEDC. Based upon
experience in dealing with the KCS and discussions with KCS representative The Staubach
Company,staff does not believe that these points are negotiable.
Mr. Hullett would like for all proration's to be collected by the closing agent and remitted to the
appropriate taxing jurisdiction. As the contract states currently, it does not specify who collects
or remits any prorated taxes. Staff did not recommend the WEDC be overly concerned with this
issue being that KCS is exempt from taxation as is common knowledge and further evidenced by
Collin County Central Appraisal District showing a zero value. Additionally Mr. Hullett
recommends that"the Buyer does not waive any exemption or other exception it or the Property
may have from rollback taxes, pursuant to Section 23.55 (t) of the Texas Property Tax Code."
While staff has presented this suggested change to KCS, it is believed to be a non-issue.
Mr. Hullett also recommended that the WEDC agrees to add the following: "to the extent
permitted by law, and without waiving any governmental immunities to which the [WEDC] is
entitled by law" to indemnify KCS. Mr. Hullett recommended that language be deleted stating
that "buyer expressly agrees to defend, indemnify and hold harmless seller and each other seller
party against seller's or such other party's own negligence."
Staff had not received a response from Staubach or KCS pertaining to the requested changes to
the Contract for Sale of Real Estate.
Staff recommended that the WEDC Board of Directors authorize the WEDC Executive Director
to execute a Contract for Sale of Real Estate between the WEDC and KCS.
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April 24,2008
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MOTION: A motion was made by Mitch Herzog and seconded by John Yeager to
authorize the Executive Director to execute a Contract for Sale of Real
Estate between the WEDC and KCS. The WEDC Board voted 4 - FOR and
0—AGAINST in favor of the motion.
ITEM NO. 5 — Consider and Act Upon Issues Surrounding Redevelopment of Property
Located at 902 West Kirby as it relates to Potential Infrastructure Assistance from the
WEDC.
Staff reviewed with the Board that on January 18, 2008,the Board authorized staff to expend up
to $15,000 for the reimbursement of costs associated with the demolition of a facility located at
902 West Kirby. This project was presented to the WEDC by Henry S. Miller with the
developer proposing a Popeye's and Burger King to be constructed on the site. In review, a
12,200 square foot facility is located on the site with approximately the same square footage in
concrete parking. Aside from a ceiling on reimbursable costs, the WEDC qualified its
participation in that the demolition must be complete no later than March 18, 2008. This
performance measure was put in place to encourage a quick closing on the property.
The developer(Sun Holdings, Inc.)will not close until June 30,2008. As well, demolition costs
have increased by approximately 50%. Even though the redevelopment has not progressed as
quickly as anticipated, staff commented that the project still has merit and the redevelopment
goals of the WEDC will still be met.
Staff recommended that the WEDC Board of Directors reauthorize the WEDC Executive
Director to expend up to $15,000 as reimbursement for demolition costs associated with property
located at 902 West Kirby while requiring a start date for demolition no later that July 31, 2008.
MOTION: A motion was made by John Yeager and seconded by Mitch Herzog to
reauthorize the WEDC Executive Director to expend up to $15,000 as
reimbursement for demolition costs associated with property located at 902
West Kirby. The WEDC Board voted 4—FOR and 0—AGAINST in favor
of the motion.
ITEM NO.6—Consider and Act Upon Issues Surrounding the WEDC Annual Report.
As the WEDC Board and City Council were informed, staff failed to complete the WEDC annual
report by January 31S' as required within the By-laws. Staff discovered the oversight in March
and informed the Council and Board of the same. Staff indicated that if approved by the WEDC
Board of Directors,the report will be presented to the Wylie City Council on May 13, 2008. The
report must include, but is not limited to, a review of all expenditures made by the Board, a
review of accomplishments, and a review of other than direct economic development.
Mr. Fuller requested that staff take whatever steps necessary to ensure that the report is
completed on time.
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April 24,2008
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Staff recommended that the WEDC Board of Directors accept the WEDC Annual Report as
presented by staff and recommend it be presented to the Wylie City Council.
MOTION: A motion was made by John Yeager and seconded by Chris Seely to accept
the WEDC Annual Report as presented by staff and recommend it be
presented to the Wylie City Council. The WEDC Board voted 4—FOR and
0—AGAINST in favor of the motion.
ITEM NO.7—Staff Update: Review Staff Activities and Ongoing WEDC Projects.
Woodbridge Crossing: The Groundbreaking ceremony for Woodbridge Crossing has been
scheduled for April 30,2008 at 6:00 p.m. Please RSVP is you have not done so already.
T J Maxx has entered into a Letter of Intent with Direct Development. This `Combo Store' will
be a prototype new to this region which has clothing and home furnishings. Also, Michaels and
Pets Mart are currently negotiating leases.
Delta E (211 Industrial Court): Delta E gave their 30 day notice to vacate a WEDC facility on
Industrial Court effective April 15. Interestingly enough, Delta E is relocating into a portion of
the building owned by Grey's Auto Electric, also located on Industrial Court.
Staff has already shown 211 Industrial Court to a local business looking to relocate their
operations.
ICSC: Staff continues to prepare for the International Council of Shopping Center Conference
to be held May 18 — 21, 2008. Updated promotional materials are being developed
(demographics and aerial) and will be completed no later than May 6a'. A new member to the
Wylie team will be Councilman Goss. Previously committed attendees are Mitch Herzog, Chris
Seely, and Mayor John Mondy.
Staff had no recommendations for this item.
EXECUTIVE SESSION
The WEDC Board of Directors convened into Executive Session at 6:34 a.m.
I. Consider and Act Upon Issues Surrounding a Performance Agreement Between the WEDC
and Texas Spectrum Electronics as Authorized in Section 551.087 (Economic
Development Negotiations) of the Local Government Code, Vernon's Texas Code
Annotated (Open Meetings Act).
II. Consider and Act Upon Issues Surrounding a Performance Agreement Between the WEDC
and Nicon Construction Company as Authorized in Section 551.087 (Economic
Development Negotiations) of the Local Government Code, Vernon's Texas Code
Annotated(Open Meetings Act).
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April 24,2008
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III. Consider and Act Upon Issues Surrounding a Performance Agreement and Real Estate
Sales Contract Between Gardner Regency, LLC and the WEDC as Authorized in Section
551.087 (Economic Development Negotiations) of the Local Government Code, Vernon's
Texas Code Annotated(Open Meetings Act).
IV. Consider and Act Upon Issues Surrounding the Performance Agreement Between Direct
Development and the WEDC as Authorized in Section 551.087 (Economic Development
Negotiations) of the Local Government Code, Vernon's Texas Code Annotated (Open
Meetings Act).
V. Consider and Act Upon Issues Surrounding the Annual Performance Appraisal and
Employment Agreement of the WEDC Executive Director as Authorized in Section
551.074 (Personnel Matters) of the Local Government Code, Vernon's Texas Code
Annotated(Open Meetings Act).
RECONVENE INTO OPEN MEETING
The WEDC Board of Directors reconvened into open session at 7:27 a.m.
Actions taken from Executive Session:
I. In February 2007, staff was contacted by a Wylie resident contemplating relocating their
company(Texas Spectrum Electronics—TSE) from Dallas to Wylie. At that time, TSE had 12
months remaining on their lease and was simply inquiring into possible incentives. On April 15,
2008, staff was contacted and informed that TSE was contemplating purchasing an existing
building on Regency Drive. Currently located in 5,000 square feet,TSE is currently negotiation
a contract to purchase a 7,500 square foot facility from Nicon Construction. TSE will be
performing approximately$96,000 in renovations to the interior of the facility.
Staff explained that WEDC assistance is primarily based upon new value. In this case, TSE may
relocate to an existing facility which will not add a significant amount of new value to the tax
roles. Furthermore, the $96,000 remodel will most likely not add dollar for dollar value to the
tax roles. However,new value in personal property will be added as well as 11 - 13 employment
opportunities to the Wylie workforce.
While TSE is able to secure financing, a current pressing need is out-of-pocket dollars to be
expended on the remodel. TSE President Michael Coots has reported TSE personal property
values ranging from $233,640 to $432,965, over the past five years. Staff recommended that in
developing an assistance package, a three year factor be utilized (based upon City and WISD tax
rates) for a minimum appraised value of personal property of$350,000. This factor will create
an incentive package valued at $22,292. Staff suggested that fifty percent of the package be
funded at certificate of occupancy to assist with remodel costs and the remaining fifty percent
could be funded at the end of the three year period, assuming the minimum person property
value is maintained, or an average thereof, over the same period.
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April 24,2008
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Mr. Fuller asked that the $350,000 minimum appraised value include gains in personal and real
property values.
MOTION: A motion was made by Mitch Herzog and seconded by Chris Seely to
authorize the Executive Director to execute a Performance Agreement
with Texas Spectrum Electronics with a potential value of$22,292. The
WEDC Board voted 4—FOR and 0—AGAINST in favor of the motion.
No further action was taken as a result of discussions held in Executive Session.
ADJOURNMENT
With no further business, President Marvin Fuller adjourned the WEDC Board meeting at 7:28
a.m.
(//4 Atil/k. 24—
Marvin Fuller, President
ATTEST:
Samuel D.R.Satterwhite
Executive Director