08-17-2006 (WEDC) Minutes Minutes
Wylie Economic Development Corporation
Board of Directors Meeting
Thursday, August 17, 2006—6:00 P.M.
Inwood National Bank—Conference Room
200 South Hwy. 78 —Wylie, Texas
CALL TO ORDER
Announce the presence of a Quorum.
President Fuller called the meeting to order at 6:00 p.m. Board Members present were:
John Yeager, Gary Bartow, Mitch Herzog, and Merrill Young arrived at 6:14 p.m).
Staff present was Executive Director Sam Satterwhite and Administrative Assistant Gerry
Harris.
Others present were Mayor John Mondy.
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 31,2006 Minutes of the
WEDC Board of Directors Meeting.
MOTION: A motion was made by Gary Bartow and seconded by John Yeager
to approve the July 31, 2006 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 July 2006 WEDC
Treasurer's Report.
Staff indicated that the City of Wylie Finance Department had completed and updated the
WEDC Balance Sheet, but it was not received prior to the WEDC Board Meeting. Staff
is reviewing the Balance Sheet for accuracy and will present the same at the regular
Board Meeting in September.
MOTION: A motion was made by Mitch Herzog and seconded by John Yeager
to table the July 2006 WEDC Treasurer's Report. The WEDC
Board voted 4—FOR and 0—AGAINST in favor of the motion.
WEDC—Minutes
August 17, 2006
Page 2 of 6
ITEM NO. 3 — Consider and Act Upon Issues Surrounding Paving and Utility
Improvements to Martinez Lane.
Staff presented the Board with estimates for paving and utility improvements for
Martinez Lane. To pave the entire length (2,000 linear feet), Helmberger Associates has
estimated the improvements at $506,073. Staff also presented an estimate to pave from
the WEDC property line to Alanis which came in at $346,660. Engineering services will
be based upon construction costs utilizing a sliding scale.
Staff reported that after consulting with City Engineer Chris Hoisted, the existing
concrete section in front of Holland Hitch could be considered adequate and provide
extended service with a certain amount of maintenance. Holland Hitch has indicated that
they would not be interested in participating in any road improvements. Utilizing the
$346,600 estimate for WEDC frontage to Alanis and adding 210 feet of asphalt prior to
the transition to concrete, paving and utility estimates equal $374,639 which includes
±$29,000 for engineering services. Again as a review, staff indicated that the WEDC is
already approved to borrow up to $366,000 for improvement to Martinez in addition to
±$50,000 which has been escrowed by the City of Wylie for perimeter street fees.
Staff provided a cost benefit analysis related to future value of the WEDC property at a
build-out compared to land and improvement costs. Based upon land, paving and
utilities, surveying, relocation of overhead utilities, clearing of brush, surveying, and
interest paid to date, the WEDC will have expended $1,136,327 on the 25 acres at
Martinez. Based upon the number of acres outside the flood plane (15), the WEDC will
need to secure at least $14.8 million in real and personal property improvements to
achieve a 3.5 year break-even point.
Staff reported that it is currently pursuing three projects for the Martinez property. JTM
Technologies is proposing constructing 20,000 square feet and would like to begin
construction as soon as possible. Costs are estimated at $1,200,000 with personal
property of$1 million. JTM has 22 employees with an average salary of$55,000. The
second project is M-Tex Industrial Supplies. M-Tex is proposing a 26,125 square foot
facility with a construction cost of ±$1.6 million. The start-up company is currently
negotiating for the purchase of equipment. Employment estimates are 150 initially up to
300 within 18—24 months.
Staff recommended that the WEDC Board of Directors authorize the Executive Director
to enter into a contract with Helmberger Associates for the design of paving and utility
improvements to Martinez Lane.
MOTION: A motion was made by Gary Bartow and seconded by Merrill Young
to enter into a contract with Helmberger Associates for the paving
design of Martinez Lane, further directing staff to place the design
out for bid for the paving and an alternate bid for maintenance on the
WEDC—Minutes
August 17, 2006
Page 3 of 6
existing concrete section. The WEDC Board voted 5 —FOR and 0—
AGAINST in favor of the motion.
ITEM NO. 4 — Consider and Act Upon Issues surrounding the Relocation of
Overhead Electric Lines Impacting WEDC Property on Martinez.
As staff reported previously, the TXU Electric quote to relocate the overhead aerial lines
to the east of the existing creek running parallel to the sanitary sewer easement is
$59,957. Relocating the overhead lines will allow the WEDC to utilize approximately
2.5 acres for proposed building sites being that facilities cannot be constructed
underneath overhead lines.
Staff also presented the Board with a survey of the Martinez tract which depicted Zone
"X", or the existing FEMA estimate of the location of the flood plane. The actual flood
plane line based upon the topographic survey can be relocated by performing a flood
study. The price of the study is $9,000 as indicated by Mr. Boyd. Appropriate contractual
documentation will be provided in the event the WEDC chooses to proceed with the
flood study. Staff presented an aerial representation depicting the movement of the actual
flood plane line outside of the buildable area on the Martinez site based upon preliminary
conclusions of Mike Boyd. These conclusions can only be realized by undertaking the
flood study.
Staff recommended that the WEDC Board of Directors authorize the WEDC Executive
Director to enter into a contract with TXU Electric in the amount of $59,957 for the
relocation of overhead utility lines. Furthermore, staff recommends that the WEDC
Board of Directors authorize the Executive Director to enter into a contract with Nathan
Meyer, not to exceed $9,000, for the development of a flood study of WEDC property on
Martinez to compliment the overhead aerial relocation.
MOTION: A motion was made by John Yeager and seconded by Mitch Herzog
to enter into a contract with TXU Electric in the amount of$59,957
for the relocation of overhead utility lines, and to enter into a
contract with Nathan Meyer, not to exceed $9,000, for the
development of a flood study of WEDC property on Martinez. The
WEDC Board voted 5 FOR — and 0 - AGAINST in favor of the
motion.
ITEM NO. 5 —Consider and Act Upon an Incentive Agreement Between the WEDC
and JTM Technologies.
Staff reported that JTM Technologies is an engineering company focused on support to
the semiconductor industry. Staff reported that JTM currently occupies two, 4,000
square foot facilities and a third 2,400 square foot facility on Industrial Court in Wylie.
WEDC—Minutes
August 17, 2006
Page 4 of 6
JTM is proposing the construction of 20,050 facility on WEDC property located on
Martinez.
The JTM site has been conceptually established at 2.01 acres. The site would support a
20,050 square foot facility as well as a future expansion of 8,043 square feet. The Board
directed Staff to ensure via future contractual commitments that JTM will keep the
unoccupied land maintained and landscaped until such a time that their building is
expanded.
JTM is currently working with American National Bank for their financing. Staff
commented that should JTM secure financing, the WEDC should begin developing the
Loan Agreement, plat the Martinez property, and pursue waiver of the parkland
dedication fees associated with platting.
MOTION: A motion was made by Gary Bartow and seconded by Mitch Herzog
to enter into a Letter of Intent with JTM Technologies for the
conveyance of 2.01 acres for the purpose of constructing a 20,050
square foot building. The WEDC Board voted 5 FOR — and 0
AGAINST in favor of the motion.
ITEM NO. 6 — Consider and Act Upon Issues Surrounding a Loan Agreement
Between the WEDC and Brad D.Jacoby and Catherine G.Jacoby.
Staff has been contacted by Mr. Brad Jacoby, owner of Best Circuit Boards, Inc. to
discuss the second lien the WEDC has on property located at 901 Hensley Land. Mr.
Jacoby was not aware that there was an issue surrounding the outstanding debt of
$147,649 predicated upon the completion of Building Two and a building permit for
Building Three as detailed in the Loan Agreement. Currently, Mr. Jacoby owns the land
and building located at 901 Hensley and leases it back to BCB. BCB intends to purchase
the land,building, and other operating obligations for$10,500,000 from Mr. Jacoby.
As described by staff, the issues at stake are that BCB and Jacoby need the WEDC to
release its lien in order to fund the payment to Mr. Jacoby and proceed with BCB going
public. President Fuller commented that the primary objective of these discussions is to
ensure at a minimum that Building Two (40,000 square foot office) is completed at the
location east of the existing BCB facility. The secondary and equally important issue is
how the WEDC can impact the potential expansion of Moulding Associates through
negotiations with BCB for the release of the lien.
BCB attorneys have presented the WEDC with a Subordination Agreement which
subordinates the WEDC note to a$10,500,000 loan with Amegy Bank. The Amegy loan
will fund the purchase of land,building and equipment from Jacoby.
WEDC—Minutes
August 17, 2006
Page 5 of 6
MOTION: A motion was made by Gary Bartow and seconded by Mitch Herzog
authorizing President Fuller to subordinate the WEDC's lien to
Amegy Bank based upon the successful renegotiation of the Loan
Agreement between Jacoby and WEDC identifying amended
construction time frames for Buildings Two and Three; instructing
staff to negotiate for the purchase of 44 feet from BCB for the
expansion of Moulding Associates; instructing staff to negotiate for
the WEDC purchase of the 3.5 acres adjacent to BCB; and directing
staff to ensure that the terms of the Loan Agreement are assigned to
BCB; and finally directing staff to ensure that the Jacoby outstanding
debt of$147,649, plus accrued interest, is secured in the renegotiated
Loan Agreement. The WEDC Board voted 5 FOR — and 0 —
AGAINST in favor or the motion.
ITEM NO. 7—Consider and Act Upon Issues Surrounding Budget Transfers to the
WEDC FY 2005—2006 Budget.
Staff presented budget transfers involving Tools and Equipment ($160), Computer
Software ($1,600), Communications ($2,100), Dues ($250), Insurance ($1,140),
Development Fees ($750), Computer ($1,650), and Furniture and Fixtures ($5,700)
totaling $13,500. To offset increased expenses, staff recommends that Incentives be
reduced by$13,500.
MOTION: A motion was made by Merrill Young and seconded by John Yeager
approving budget transfers in the amount of $13,500. The WEDC
Board voted 5 FOR—and 0—AGAINST in favor or the motion.
EXECUTIVE SESSION
The WEDC Board of Directors convened into Executive Session at 8:40 p.m.
ITEM NO. 1 — Convene into Executive Session to Hold Deliberations Regarding
Real Property (Purchase of Real Property by the WEDC Located Near the
Intersection of F.M. 544 and F.M. 1378) as Authorized in Section 551.072 of the
Local Government Code, Vernon's Texas code Annotated (Open Meeting Act).
Mitch Herzog stepped out of the meeting.
RECONVENE INTO OPEN MEETING
The WEDC Board of Directors reconvened into open session at 8:53 p.m. The Board
declined to take action on the real estate issue, but directed staff to take the issue to
Council to determine the City's interest in the property.
WEDC—Minutes
August 17, 2006
Page 6 of 6
ADJOURNMENT
With no further business, President Fuller adjourned the WEDC Board meeting at 8:54
p.m. Consensus of the WEDC Board was to adjourn.
Marvin Fuller, President
ATTEST:
Samuel D.R. Satterwhite
Executive Director