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07/13/2010-4A-Minutes-RegularMINUTES: 4A ·MEMBERS SANGER TEXAS INDUSTRIAL DEVELOPMENT CORPORATION July 13, 2010 PRESENT: Bill Fuller, Vickie Jenkins, Carroll McNeill MEMBERS ABSENT: Fred Yeatts, Don Gillum OTHERS PRESENT: Mike Brice City Manager, Cheryl Price Administrative Assistant 1. Call Meeting to Order. President Fuller called meeting to order at 1 :00 p.m. 2. Approval of Minutes: March 23, 2010 Motion was made by Vickie Jenkins to approve the minutes as written. Motion was seconded by Carroll McNeal. Motion carried unanimously. 3. Update on C & M Steel Project. Mike Brice advised that the lease was signed at the end of May, and they began remodeling the offices at the beginning of June. They have almost completed the remodeling of the office areas and have begun working on the yards and putting in the fencing and other items necessary for their operation. The last time he spoke with them · they indicated they would like to be in operation by the 1st of August. There have been no major issues and they have been great to work with. He noted that we have paid out about $40,000 of the $150,000 allotted for the remodeling. President Fuller asked if they got out of their lease in Denton. Mike Brice reminded the board we discounted rent for the 1st year up to $100,000 which was negotiated with them to help them get out of their lease. The first year the City will break even, in relation to getting no payments; the second year we will start netting about $30,000 per year. President Fuller asked ifwe would get sales tax off of what they see. Mr. Brice noted that they do mostly fabrication and erection; it is all wholesale, which is not taxable in most cases as far as sales tax. President Fuller asked how many employees they had. Mike Brice advised that they currently have 27 and wanted to ramp up to 40 to 50 employees. At their old facility they were only able to do one project at a time. He noted he had been to their old facility and they were doing more work outside the building then they were inside. They are still in production at their old facility until they are ready to move. 4. Update on Infrastructure Projects. Mike Brice advised that we are continuing to move forward with the water and wastewater lines that are going to run north from Wal-mart to the new View Road. The new View Road is in and substantially complete. There is a problem with the entrance so we have not accepted the road yet. The grade on the entrance is too high and they are going to fix that. We are still moving forward on the plans to move water and wastewater lines up there. The 4A Board has committed up to $100,000 for one of the wastewater lines which will probably happen sometime in 2011. 5. Discuss, Consider and Approve the 2011 Budget. Mike Brice noted that he provided a hand out which is a simplified version of the budget proposal for this year. He noted that there is an Incode Budget report in their agenda that has several line items and that they never use any money in those line items, so there is no need to put any money in them. The same holds true with the Economic Development budget. Basically we have three revenue sources coming into the sales tax; which have been reduced a little bit based on collections this year. Interest has also been reduced because the rates are down as far as their interest rates on the CD's etc. The rent for 103 Bolivar is estimated at about $66,000 for this upcoming year and that is basically their payment on the remodel, as they start paying that back. Expenditures on the note payment for 103 Bolivar is $61,272 next year. Taxes are estimated at $24,000 next year on 103 Bolivar. That is the only thing that we are responsible for, they are responsible for all of the maintenance on the building. The transfer for the General Fund has been reduced this year to $18,000. It was $20,000 last year. It has been reduced to give 4A more money to do things with. Our budget has been slashed on the General Fund for every department this year and it was also done on the Economic Development Budget as well. The $18,000 is for advertising, administrative services, etc. That leaves an estimated balance for 4A next year of about $196,000 which does not include the fund balance carryover. This is just the 2011 Revenues and Expenditures. Carroll McNeill noted it sounds like the 4A is on solid footing. Mike noted that was correct. Vicki Jenkins wanted to be reminded as to how they were funding the remodel. Mike advised that it was cash payments. Motion was made by Carroll McNeal to approve the 2011 Budget as submitted. Motion was seconded by Vicki Jenkins. Motion carried unanimously. 6. Review Financials. Mike Brice noted there were several items in their packet. He noted that he also provided a hand out which is a register of the Money Market account which lists checks that have been written on the account since the beginning of the year. He summarized the various debits and credits and transfers listed on the register Mike noted that as far as Investments, the 4A has a little over $400,000 in the bank. There is about $110,000 outstanding to pay out to C & M and $16,000 to Elk River; which leaves about $275,000. The only other commitment is the $100,000 for the wastewater line which won't be until way into next year and the 4A will collect sales tax to keep them at right about $200,000 to 300,000. On the 4A deposits, June is down slightly compared to 2009. July Sales Tax was received this morning and it is also down a little from 2009. Sales Tax is rebounding a little bit. Revenue Expenses for the year - year to date actual is $178,385.64. He noted that the expenditures on the report in their packet does not include the checks that were recently written since this budget report was completed last month. He noted the property taxes were transferred out of the 4A Budget to the Economic Development Budget for payment. The same holds true for the line item accounts in the budget. He solicited questions. Carroll McNeill asked if they could get a list of the top ten who pay into sales tax. Mike advised that he could not get a list of the top ten, because that information is confidential. He provided the board members with copies of the sales tx information he obtained from the Comptroller's office which is broken down by industry type. 8. Adjournment. The meeting was adjourned at 1:25 p.m.