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HomeMy WebLinkAboutMinutes Corpus Christi Business And Job Development Corporation (Type A) - 04/16/2012MINUTES CORPUS CHRISTI BUSINESS AND JOB DEVELOPMENT CORPORATION (TYPE A) REGULAR MEETING CITY HALL — COUNCIL CHAMBERS APRIL 16, 2012 — 3:00 P.M. PRESENT: Members Eloy Salazar, President Robert Tamez, Vice President Foster Edwards, Secretary Adolfo (Butch) Escobedo R. Bryan Gulley Staff Margie Rose, Assistant City Manager Charlotte Yochem, Assistant City Attorney Armando Chapa, Assistant Secretary Constance Sanchez, Finance A. Called meeting to order — President Salazar called the meeting to order at 3:08 p.m. B. Roll Call - President Salazar verified that the necessary quorum of the Board were present to conduct the meeting. Approval of Minutes - Mr. Tamez made a motion to approve the Regular minutes of March 19, 2012, seconded by Mr. Escobedo and passed. 8. Presentation by TAMU -CC and Del Mar College on the Type A internship programs at their respective schools. — Beverly Cage, Del Mar College and Terry Hale and Dr. Jim Needham, TAMU -CC provided information on the activity of the internship programs at their respective schools including the number of interns; the number of full -time placements; and the types of jobs provided. Lauren Lillian, Del Mar College intern, spoke regarding her experiences with the intern program. The following topics pertaining to this item were discussed: use of the program by non- profit organizations; the number of placements at TAMU -CC; breakdown of the amount paid by the businesses and the program; when the applying process for the fall semester will begin; the number of permanent hires through the Del Mar program; and whether there is trouble recruiting employers. President Salazar announced the following closed sessions (Items 2 -3): 2. Closed session under 4551.087 of the Texas Govern Code to discuss or deliberate regarding commercial or financial information pertaining to Proiect Trout that the Board has received from, or to deliberate the offer of a financial or other incentive to, a business prospect that-the Board seeks to have locate, stay, or expand in or near the city and with which the Corporation is conducting economic development negotiations, with possible discussion and action in open session. 3. Closed session under §551.087 of the Texas Governm Code to discuss or deliberate regarding commercial or financial information pertaining to Proiect Chain that the Board has received from, or to deliberate the offer of a financial or other incentive to a business prospect that the Board seeks to have locate, stay, or expand in or near the city and with which the Corporation is conducting economic development negotiations, with possible discussion and action in open INDEXED Type A Meeting April 16, 2012 -- Page 2 session. The Corporation went into closed session. The Corporation returned from closed session. President Salazar announced that no action would be taken on Item 2. President Salazar reported that the board would vote on Item 3 later in the meeting. 4. Financial Report — Director of Financial Services Constance Sanchez presented the sales tax report updated through February; the cash flow statements; and the commitment reports for the economic development fund. A motion was made by Mr. Tamez to approve the financial report, seconded by Mr. Escobedo and passed. President Salazar opened discussion on Items 5 through 7. 5. Motion to terminate the Type A Agree ment with TDL Plastics LLC and to de- obligate the_$50,004__oriainally approved for the .proaect because of TDL Plastics closing their business due to a change in their business model. 6. Motion to terminate the Type A Agreement with Lakeside Steel and to de- obligate the $150,000 originally approved for the proiect_ for failing to _meet the requirements of the Agreement 7. Report of Turner Industries' compliance status and motion to de- obligate $472,000 of the amount originally approved for the promect. Mike Culbertson, Corpus Christi Regional Economic Development Corporation, referred to Item 5 and explained that TDL Plastics decided to discontinue operations and is requesting termination of the agreement. Mr. Culbertson referred to Item 6 and explained that Lakeside Steel Texas Inc. was purchased by JMC Steel Group and that company has chosen not to expand. Mr. Culbertson reported that Lakeside is requesting termination of the agreement. Mr. Culbertson referred to Item 7 explained that Turner Industries did not receive their incentive payment from year 2 and staff is requesting to de- commit these funds. Mr. Culbertson added that Turner Industries is in full' compliance of the current agreement and is eligible to receive payment. Dr. Gulley made a motion to approve Items 5 and 6 as presented, seconded by Mr. Edwards and passed. Mr. Edwards made a motion to approve Item 7 as presented, seconded by Mr. Escobedo and passed. 9. Motion to award $500,000 to the Arena Marketing Co /Promotion Fund to offset event- related expenses incurred in attracting business to the Arena, up to $100,000 of which will be available on short notice, with City Manaaer's approval, to cover the cost of rent for events such as music concerts and comedy performances, to allow for quick responsive negotiations and offers to waive rent by SMG, to better attract such performances, to amend the budget to allow for this funding of $500,000 to the Arena Marketing Co /Promotion _Fund and to appropriate the $500,000 for the Arena Marketing Co /Promotion Fund. —Jim Salamenta, General Manager of the American Bank Center, stated that the American Bank Center is Type A Meeting April 16, 2012 — Page 3 requesting to replenish the Arena Marketing /Co- Promotion fund in the amount of $500,000 to be utilized by SMG to provide funding to the arena for the purpose of attracting businesses by subsidizing rental of facility. Mr. Salamenta provided economic impact information on the use of the marketing co- promotion fund. Mr. Salamenta also requested that the board pre - approve $100,000 of these funds to be used on short term notice, with City Manager approval, to cover the rent for events such as concerts or comedy performances to allow for quick responsive negotiations. The following topics pertaining to this item were discussed: the award period for the arena marketing co- promotion fund; ratification by the board on the use of the $100,000 that is used on short term notice; increasing the amount of the arena marketing/co- promotion fund to $600,000; the entity responsible for calculating the economic impact study; subsidizing the IceRays; and policy evaluation of current funding. Mr. Tamez made a motion to amend the motion to award $500,000 to the Arena Marketing Co /Promotion Fund to offset event- related expenses incurred in attracting business to the Arena, B and an additional $100,000 of which will be available on short notice, with City Manager's approval, to cover the cost of rent for events such as music concerts and comedy performances, to allow for quick responsive negotiations and offers to waive rent by SMG, to better attract such performances, to amend the budget to allow for this funding of $600 to the Arena Marketing Co /Promotion Fund and to appropriate the $600,000 for the Arena Marketing Co /Promotion Fund, seconded by Mr. Escobedo. The motion was passed and approved with the following vote: Salazar, Escobedo, and Tamez, voting "Aye "; Edwards and Gulley voting "No ". Mr. Tamez made a motion to approve Item 9 as amended, seconded by Mr. Escobedo and passed (Gulley voting "No "). 10. Discussion and possible action regarding Affordable Housing Program's request for allocating $400,000 from re-captured Type A funds to the Existina Invento Homebuyer Assistance Program in order to allow assistance to be provided to 20 homebuyers. — President Salazar announced that he would abstain from the discussion and vote on this item. Director of Neighborhood Services Eddie Ortega explained that this item is requesting the allocation of $400,000 from re- captured affordable housing funds from previous expenditures and placing these funds into the Existing Inventory Homebuyer Assistant Program to assist 20 additional homebuyers. The following topics pertaining to this item were discussed: the status of the new homebuyer assistance program; the success of the existing inventory homebuyer assistance program; reconsidering the amount awarded to homebuyers from $20,000 to $10,000 to assist more homebuyers; marketing of the programs; and pros and cons of reducing the amount. Mr. Edwards made a motion to approve Item 10, seconded by Mr. Escobedo, and passed (Salazar abstained). Type A Meeting April 16, 2012 -- Page 4 11. Motion authorizing the Board to de- commit the remainina $12,067 of the $225,000 originally awarded to the Corpus Christi Community Development Corporation and return these funds back into the Affordable Housing Pro for homebu er assistance for affordable housing - Mr. Ortega explained that this item is requesting that the board recapture the remaining $12,067 of the original $225,000 awarded to the Corpus Christi Community Development Corporation. Mr. Edwards made a motion to approve Item 11, seconded by Mr. Escobedo and passed (Salazar absent). 3. Closed session under 4651.087 of the Texas Government Code to discuss or deliberate re commercial or financial information pertaining to Project Chain that the Board has received from, or to de_ liberate the offer of a financial or other incentive to, a business prospect that the Board seeks to have locate, stay, _ or expand in or near the city and with which the Corp mration is conducting economic development negotiatio s with possible discussion n, and action in open session. President Salazar returned to discussion on Item 3. Mr. Edwards made a motion to approve $200,000, with $50,000 paid out when Project Chain closes on the purchase of the property they are buying for their operations, and $50,000 paid out annually or the anniversary of that purchase date for the next 3 years all contingent upon Project Chain receiving a contract from Texas A & M for the manufacturing of bicycles, and appropriating $200,000 from the unreserved fund balance of Fund #1140 e\Economic Development Fund for Project Chain and amending the fiscal year 2012 budget for Fund 1140, seconded by Mr. Tamez and passed. Mr. Escobedo requested to find out who owns the property to make sure there is not a conflict of interest for any official. 12. Information related to obligation of future revenue In response to a previous question from the board, Assistant City Attorney Charlotte Yochem responded that the Type A Board can obligate future revenue as long as the funds are available. 13. Information related to use of Type A funds for the S chlitterbahn project - Assistant City Attorney Yochem received a legal opinion from Seidlits & Carr regarding Type A funds being used for the Schlitterbahn project stating that funds can be used for the costs for infrastructure necessary to promote or develop new or expanded business enterprises. Mr. Escobedo asked questions regarding whether there are any examples of other similar projects approved with Type A funds in the state. 14. Presentation to the Board on Type A Fundin of Seawall Refundina Options - Director of Financial Services Constance Sanchez referred to a powerpoint presentation including the seawall sales tax; refinancing opportunities; Type A board actions; and staff's recommendation for a seven -year par call. Ms. Sanchez also provided information on the recommended bond counsel, financial advisor, and underwriters. Type A Meeting April 16, 2012 — Page 5 The following topics pertaining to this item were discussed: the recommended financial team; the reason the financial advisor is concerned that investors might not accept a five -year par call; whether the sales tax would stop if the bonds are paid off early; continuing collection of sales tax until the life of the bond; the amount owed on the bond; consideration to refinance for ten -year period; the status of the seawall improvement projects; and continuing the sales tax to use for. maintenance and protection of the seawall. There was a general consensus of the board to have staff prepare documents for refinancing with a ten -year par call and call a special meeting if necessary. G. Public Comment - None. H. Identify Future Agenda Items — None. Adjournment There being no other business to come before the board, President Salazar adjourned the meeting at 5:10 p.m.