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01/06/2009-4A-Minutes-RegularI MINUTES: SANGER TEXAS INDUSTRIAL DEVELOPMENT CORPORATION January 6, 2009 MEMBERS PRESENT: Bill Fuller, Vicky Jenkins, Gary Bilyeu, Fred Yeatts, and Carroll McNiell OTHERS PRESENT: City Manager Mike Brice, City Secretary/Asst. City Manager Rose Chavez 1. Call Meeting to Order. President Fuller called meeting to order. 2. Approval of Minutes: July 22, 2008. Carroll McNiell made a correction to the minutes as follows: Item 2 -correct the motion to read Carroll McNiell. Vickie Jenkins made the motion to approve the minutes as corrected. Seconded by Gary Bilyeu. Motion carried unanimously. 3. Update on Water and Wastewater Master Plan. The City Manager proceeded with an update on the water and wastewater master plan study. ·He indicated the Board had approved to fund a portion of this cost in a previous meeting. He also advised the City Council approved the firm of KSA Engineering to conduct the studies. They will start sometime this month and it will be completed in June 2009. There were three firms that were interviewed to conduct the study and KSA seemed to have more experience with smaller cities. The other two fmns had expertise with larger cities and their prices were reflected in their fees.· The total cost for the studies will be about $93,000 instead of the estimated $80,000 which he anticipated. The price range of the other two firms was over $150,000.00. The additional funds to cover this cost have been budgeted in the City's General Fund Budget. He will have some preliminary reports for the April meeting, and for the July meeting he should have the completed fmal studies. KSA will look at all the existing infrastructure for water and wastewater in the City and will look at the needs of the future, both in upgrading existing and new infrastructure. They will also take a look at the wastewater: plant to get an idea of , the initial size the plant needs to be. Currently, the plan is for 2-million gallon capacity. It could be that the study could indicate a different projection on the size of the plant. President Fuller asked for the current capacity of the plant. City Manager indicated the City is currently license at 980,000 gallons a day and the City averages around 700,000 a day. 4. Discussion on Purchasing Warehouse Property for Economic Development Purposes. City Manager discussed that he would like to get the Board's opinion concerning property that can possibly be used as an economic marketing tool. He advised that the gentleman who is the owner of the We-Package It Plant contacted him before Christmas on the possibility of the City having any interest in this building. The building has been for sale for two years and currently there are not any prospects. The building is listed for 1.25 million with a realtor, and the owner indicated to him that he is willing to take significantly less than this for the building. The City Manager advised that the City at one time was looking to purchase this building for municipal purposes, and this was the reason the owner contacted him. He did advise the owner that there might be some interest in the building from an economic development standpoint. This is where he needs input from the Board on how to proceed. The City Manager continued and advised there are a lot of cities who develop Industrial Parks, whether it is raw land or spec buildings, to market and use them as a market incentive. This is done by selling the property below market price, financing the property at a lower interest rate, or leasing the building below market lease rates. As the company progresses, the lease can increase. It is a tool that a lot of Economic Development Boards use to get people in their cities. This is a marketing tool the City does not have. Currently what is offered are monetary incentives and tax abatements. Recently, the City was on the short list for a company to relocate to the City; however, this company went to Burleson. They had an Industrial Park owned by Economic Development and their offer to this company was free land. The City does not have anything like this in place. The purchase of this building at a decent price would be an opportunity to start a baby step toward an Industrial Park. This would be a marketing tool to entice some type of manufacturer or warehouse-type business to locate in Sanger. The City of Ardmore has done this for 15 or 20 years. Their Economic Development Corporation owns several buildings in Ardmore. They have actually become a revenue source for Economic Development. The tenants have been leasing those buildings long enough that the lease payments have become a cash flow for Economic Development. This does not occur overnight, but it happens over time. The City already owns the lumber yard, and if they could purchase this building and possibly purchase the additional two houses north of this property, it I would give the City significant property to market. ,' I Vickie .Jenkins inquired on the size of the building and the acreage. City Manager advised it is 51,000 square feet and has 4 ½ acres. Discussion on the rail spur and the benefit this would be as a marketing tool The City Manager asked the board members for direction on how they would like for him to proceed in the purchase of land or buildings as economic incentive as they move forward. Vickie Jenkins inquired on the condition of the building. The City Manager discussed the condition of the building and the improvements that have been made. It was discussed if the building does not change use or more than 50% remodel is not done, it will not be required to have a sprinkler system for fire protection. The purchase of the property is not to make a profit but to use it as an incentive for the purpose of creating jobs. Discussion continued. It was the consensus of the Board for the City Manager to proceed on contacting Mr. Gaffke concerning the significant less price he is asking for this property. The City Manager advised he will contact the members by e-mail regarding any information. 5. Review Financials. 6. City Secretary gave a brief review on the current and the year end financial reports for revenues and expenditures; sales tax collected in 2007 and for 2008; which was followed by an overview of the balances in money markets and certificate of deposit accounts. A discussion continued concerning the interest rates that went into effect January 1, 2009. Brief discussion followed concerning the $25,000 transfer to General Fund and how that . is appropriated. The funds are utilized within the Economic Development budget in the General Fund and for 2008 the budget was $70,000. It also compensates the City for the City Manager and the City Secretary's, time dedicated for Economic Development. Discussion followed concerning the type of sales that impact local sales tax. Adjournment. President Fuller declared meeting adjourned.