09-23-2016 (WEDC) Minutes Minutes
Wylie Economic Development Corporation
Board of Directors Meeting
Friday, September 23, 2016—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 6:32 a.m. Board Members present were John
Yeager, Mitch Herzog, and Demond Dawkins.
Ex-officio members Mayor Eric Hogue was present and Chief Parker attended for City Manager
Mindy Manson.
WEDC staff present was Executive Director Sam Satterwhite, Assistant Director Jason Greiner and
Senior Assistant Angel Wygant.
CITIZEN PARTICIPATION
Lynn Grimes was in attendance and reminded the Board that the annual Boo on Ballard Event would
be held on October 27th in historic downtown Wylie. In addition,the B&B fun run would be held on
November 19th at 9:30 a.m. benefitting the Christian Care Center.
ACTION ITEMS
ITEM NO. 1 — Consider and act upon approval of the August 19, 2016 Minutes of the Wylie
Economic Development Corporation (WEDC) Board of Directors Meeting.
MOTION: A motion was made by Mitch Herzog and seconded by
John Yeager to approve the August 19, 2016 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 August 2016 Treasurer's Report.
MOTION: A motion was made by John Yeager and seconded by Demond Dawkins to
approve the August 2016 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 a performance agreement between the WEDC and ACG
Texas,LP.
Staff informed the Board that ACG Texas initially approached the WEDC in an attempt to evaluate
options surrounding the construction of a 4,525 square foot commercial building near FM 544 and
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September 23, 2016
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County Club Road within the Kroger Marketplace anchored Woodbridge Centre. ACG Texas plans
to construct a new IHOP Restaurant on the pad site adjacent to The Rock Wood Fired Kitchen. Based
upon direction provided within Executive Session, staff is presenting a Performance Agreement to
provide financial assistance to ACG.
ACG Texas has a project cost of$1,100,000 (not including land acquisition) and plans to hire 40
employees at the new location. Should ACG close on the site and the project moves forward,
construction will begin within the first quarter of 2017 with an estimated completion date within the
third quarter of 2017.
ACG Texas received a variance from the Board of Adjustments to allow shared parking with Kroger,
thus reducing their required footprint. This variance helps ensure that this property is being designed
to allow for future development between the ACG pad site and the Starbucks.If the variance had been
denied, this project would have required much more on-site parking than the current 1.05-acre site
would allow and it would have severely limited future development on the adjacent 1.08-acre site.
ACG Texas has requested that the WEDC provide economic assistance to offset the cost of qualified
infrastructure improvements for the project. The attached Agreement proposes a total maximum
incentive of$35,000 which is broken down as follows with the corresponding performance measures:
Incentive No. 1 ...........................................,............,.,.....,..... $35,000
➢ Construction of 4,525 sq ft IHOP Restaurant within Woodbridge Centre
➢ Total project costs verified at $1,100,000
➢ Qualified Infrastructure costs verified at$35,000
➢ ACG is current on property taxes
➢ Certificate of Occupancy is issued no later than December 31, 2017
Should ACG Texas 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 noted an amendment to the Agreement as presented. ACG had contacted staff after Board
Packets had been distributed and requested a change of signator on the agreement from Joseph
Langteau,President & CEO to Mike Evans, President.
Staff recommended that the WEDC Board of Directors approve a Performance Agreement between
WEDC and ACG Texas, LP, as amended, providing for an incentive of $35,000 and further
authorizing the WEDC Executive Director to execute said Agreement.
MOTION: A motion was made by Mitch Herzog and seconded by John Yeager to approve
a Performance Agreement, as amended, between WEDC and ACG Texas, LP
providing for an incentive of $35,000 and further to authorize the WEDC
Director to execute said Agreement. The WEDC Board voted 4—FOR and 0—
AGAINST in favor of the motion.
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September 23, 2016
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ITEM NO. 4—Consider and act upon a Performance Agreement between WEDC and Mil-Tib
GP,LLC.
Staff reminded the Board that on several different occasions over the past ten years, the WEDC has
discussed redevelopment options for a property located at the southeast corner of Ballard Street and
State Highway 78 (owned by the Tibbals family). The closest the property came to selling was for a
three pad-site development anchored by Twisted Root, but negotiations fell apart at the final hour.
Since that time several entities have approached the Tibbals in an attempt to repurpose the existing
structure. Multiple obstacles exist for the building to be used relating to code requirements for fire
sprinklers and allowable parking surfaces which have significant expense. Thus the conclusion for
some time has been that the supermarket must come down to which this item is addressing.
In an effort to stimulate redevelopment on this corner and of equal importance to enhance the aesthetic
appeal of the 78 corridor, staff is recommending that the WEDC Board consider partnering with the
Tibbals family to demolish the supermarket which is comprised of 14,344 square feet and sits on 0.66
acre. Further, the Tibbals family owns additional properties in the area which are contiguous to the
supermarket totaling 2.35 acres. The joint demolition effort with Tibbals and the WEDC does not
include a building owned by the Tibbals just north and adjacent to the supermarket which is leased
by LPL Financial and is approximately 1,400 square feet. The LPL building is maintained well and
has a significant useful life as-is so therefore there is no reason to be included in this project.
The Tibbals family in coordination with the WEDC received a quote to take down the Wylie
Supermarket of $76,500. The total figure is comprised of $60,000 in demolition, $1,500 for an
asbestos survey, and $15,000 for asbestos remediation. Staff is proposing that the WEDC Board
approve participation in the demolition up to 50% of the costs not to exceed $38,250. Staff has
stipulated with the Tibbals family that if the WEDC participates and should the property upon which
the Wylie Supermarket sits is sold to a tax exempt entity within 10 years of completion,Mil-Tib GP,
LLC will be required to reimburse the WEDC an amount equal to $10,000.
The Board asked Staff how it arrived at the penalty amount. Staff explained that given the asking
price Mil-Tib anticipates for the property it is unlikely that it will sell to a tax exempt entity. Even
so, staff incorporated this penalty as a further disincentive. Staff commented that should the Board
direct staff to increase the penalty staff will revisit the issue with Mil-Tib, but is currently in
agreement with Mil-Tib for the $10,000.
The Board requested that a stipulation be included requiring a 'For Sale' sign be posted within 6
months of completion of demolition. Staff anticipates demolition commencing within 30 days and
being complete within 2 months. A question arose about the cost of demolition and staff explained
that Intercon Demolition, the winning bidder for the Hwy 78 and Industrial Court bid process,
provided a price with which both parties were comfortable with.
Staff recommended that the WEDC Board of Directors authorize the Executive Director to generate
a Performance Agreement based upon the recommended terms and Board input,between the WEDC
and Mil-Tib GP, LLC within which the WEDC funds 50% of costs associated with demolishing a
structure located at 209 S. Ballard, Wylie, Texas in an amount not to exceed $38,250, providing for
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September 23, 2016
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a penalty should the property be sold to a tax-exempt entity, and further authorizing the WEDC
Executive Director to execute said Agreement.
MOTION: A motion was made by John Yeager and seconded by Mitch Herzog to authorize
the Executive Director to generate a Performance Agreement between WEDC
and Mil-Tib GP, LLC within which the WEDC funds 50% of costs associated
with demolishing a structure located at 209 S. Ballard, Wylie, Texas in an
amount not to exceed $38,350, providing a penalty should the property be sold
to a tax-exempt entity, and further authorizing the WEDC Executive Director to
execute said Agreement. The WEDC Board voted 4—FOR and 0—AGAINST
in favor of the motion.
DISCUSSION ITEMS
ITEM NO. 5 - Staff Report: Staff report: review issues surrounding WEDC Performance
Agreements, Patna Properties, Inventrust, Cotton Patch, 605 Commerce, McClure Partners,
demolition of WEDC properties, Executive Director performance evaluation, and regional housing
starts.
WEDC Performance Agreement Summary
Attached for the Board's review was a summary of all outstanding Performance Agreements
including: 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,Woodbridge Crossing,the Wedge Corporation and Wylie Flower& Gift.
Woodbridge Crossing
Attached for the Board's review is the Sales Tax Reimbursement Report which identifies all sales
taxes received through August 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.
$3,745,116.50 in reimbursement has been earned through August 2016 with net receipts of
$2,958,444.99 after reimbursements.As well,it is estimated that$3.5 mm has been paid in ad valorem
taxes to the City of Wylie (excluding the WISD).
As shown on the Sales Tax Reimbursement Report, $151,850.10 was generated in sales tax in June
2016 versus $127,061.34 in June 2015. The reported sales tax represents 19.5% increase over 2015
receipts.
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September 23, 2016
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Patna Properties
Pulliam Construction Management has completed construction of a 4,300 square foot medical office
building for Dr. Ahmad. Patna is required to provide documentation for a total construction cost of
no less than $700,000, property taxes are current, and a certificate of occupancy. Construction cost
came in at $803,000 with all other documentation submitted. Staff will be issuing Payment #1 of
$20,000 and in 2017 Incentive Payment #2 of $10,000 will be funded upon Patna achieving an
appraised value of at least $707,000.
Inventrust
As reported previously, Inventrust had proposed a 10,000 square foot strip center adjacent to Cotton
Patch. A flyer distributed to the brokerage community was attached for the Board's review.
Cotton Patch
The new Cotton Patch within Woodbridge Crossing will be completed on or about October 1st. Staff
has reached out to the Real Estate Director for Cotton Patch to discuss how we can help with any
grand opening activities.
605 Commerce
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, is processing the VCP application for the Commerce property, and processing the
Municipal Setting Designation through the City.
McClure Partners
McClure Partners has closed on the Williford Tract and executed an agreement to build a 6,000 square
foot commercial structure. Demolition of existing structure and clearing of the site will begin
September 23rd with construction of the new facility sometime in the first quarter of 2017.
McClure is also making progress on their three pads with Freddy's and Bush's Chicken. Another
chicken concept is probably not our first choice but we need to keep in mind where we began on this
property 10+years ago.
Demolition of WEDC Properties
Intercon Demolition has indicated that all demolition and final grading will be complete by September
23rd. Erosion control will be in place by September 21.
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September 23, 2016
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Executive Director Performance Evaluation
On the October agenda and within Executive Session, the WEDC Board will be evaluating the
performance of the Executive Director. Within the next week President Fuller will distribute
evaluation forms to be completed by each Board Member and returned on or about October 10,2016.
Regional Housing Starts
Twenty-five homes were permitted in Wylie for the month of August 2016. Sachse,Lavon,Murphy
permitted a combined fifty-three with Inspiration permitting eight homes over the same period.
No action was requested by staff for this item.
EXECUTIVE SESSION
Recessed into Closed Session at 7:08 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:
• Cooper& State Highway 78
• F.M. 544 & Commerce
• Sanden& Hensley
• Highway 78 & Birmingham
Section 551.087 (Economic Development) of the Local Government Code, Vernon's Texas Code
Annotated(Open Meetings Act).
• Project 2016-lb
• Project 2016-9a
• Project 2016-10a
RECONVENE INTO OPEN MEETING
The WEDC Board of Directors reconvened into open session at 8:30 a.m. and took no action.
ADJOURNMENT
With no further business,President Fuller adjourned the WEDC Board meeting at 8:30 a.m.
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September 23, 2016
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/ v
Marvin Fuller,President
ATTEST:
Samuel Satterwhite,Director