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HomeMy WebLinkAbout12-16-2008 Council Economic Development CommitteeAGENDA City of Iowa City City Council Economic Development Committee Tuesday, December 16, 2008 8:00 a.m. Lobby Conference Room City Hall 1. Call to Order 2. Consider approval of the October 13, 2008 Economic Development Committee meeting minutes 3. Consider CDBG Economic Development Fund application: Atlas Home Service, LLC 4. Consider Englert Theater annual funding request 5. Staff time 6. Committee time 7. Adj ournment draft MINUTES CITY COUNCIL ECONOMIC DEVELOPMENT COMMITTEE OCTOBER 13, 2008 CITY HALL, CITY MANAGER'S CONFERENCE ROOM, 8:00 A.M. Members Present: Regenia Bailey, Connie Champion, Matt Hayek Staff Present: Wendy Ford, Jeff Davidson, Sarah Holecek Others Present: Davidson Hotel Representatives Ron Kim, Thom Geshay, Mark French and Crystal Beasley (via phone) RECOMMENDATIONS none CALL MEETING TO ORDER: Chairperson Regenia Bailey called the meeting to order at 8:03 A.M CONSIDER APPROVAL OF THE MINUTES OF THE SEPTEMBER 9 2008 ECONOMIC DEVELOPMENT COMMITTEE MEETING: Champion moved to approve the minutes of the September 9, 2008, Economic Development Committee as presented; seconded by Hayek. Motion carried 3-0. DISCUSS AND CONSIDER A RECOMMENDATION ON OPTIONS FOR LICENSING A PUBLIC ACCESS EASEMENT TO THE SHERATON• Ford welcomed everyone and stated that Sarah Holecek would speak to everyone about the licensing agreement first. Holecek explained that a licensing could allow the Sheraton (Davidson Hotels) to occupy and use the pedestrian access easement, subject to whatever conditions and terms are agreed to. Mark French, a corporate attorney for Davidson Hotels, stated that in his judgment, a license agreement may not work for them. He questioned the potential future need for the easement area to be 25 feet. Champion asked Holecek what "trigger points" could be used to pull the license if possible to use the redevelopment of the property as that trigger. French continued to address the details of this agreement, stating that they will have some need for a wall or a division between the hotel's lobby and this easement area. He continued to speak to the terms of this agreement, and Holecek responded to his concerns. The discussion went back to the issue of narrowing this area, with French asking about the City's concerns. Hayek said his concern is if the City permanently vacates a portion of the hours and a portion of the width, that they would never get it back. He added that his point was to not tie the hands of future City Councils or future planners, if the City's needs should change in the future. Hayek continued, stating that he would like to craft something that works for both the City and the hotel; something that keeps the City's options open. Thom Geshay asked what time frame Hayek is referring to, and Hayek stated that he would suggest 10 or 15 years, maybe even 20 years, or a change of ownership of the hotel, should that occur first. The discussion continued with Geshay stating his concerns for a time frame. He stated that his concerns have to do with how they would sell the hotel with this agreement in place in the future. He added value is lost with this type of agreement in place. French spoke to the Members, stating how the purchase of the hotel, by Davidson Hotels, was handled in terms of the easement in the lobby. He added that once they purchased the hotel, and they began renovation plans, they saw that this area needed to be improved, in energy Economic Development Committee Meeting October 13, 2008 efficiency, safety, etc. He continued to explain the hotel's stance and what they are hoping to do with their lobby area. Champion brought up the redevelopment issue again, and French asked for clarification of this. Geshay added that the idea for this space is to put in a glass wall, that the view and use and perception would be the same, and that by improving the exterior portion of the easement, this will add to the area, as well. Bailey asked if the Members could move forward with an agreement at this time. A brief discussion ensued, with Hayek voicing concerns. He added that he feels they need some trigger point, whether change in ownership or a set number of years down the road, where the City can review this agreement. Geshay added they buy hotels, they typically look at a time period of over 40 years. French reiterated that the hotel does plan to invest in rehabilitation, regardless of what they come up with in an agreement. He added that they believe the desired request will enhance the property for everyone. Holecek then restated the three trigger points in a license agreement that she hears the Committee suggesting — redevelopment of the property, change of use of the property, and a term of 25 years. French responded to these points, explaining his concerns for each one. A term of 40 years was suggested then, taking from Geshay's comment about land leases. French added that he believes a time frame of any sort would not work for them, but that the redevelopment point makes sense to him. Hayek stated that he believes he could agree with the three points as stated. French stated that he will talk to the owners about this, but that the 25 years just will not work for them. Discussion continued, with Members stating their concerns on not having a specific time frame in this agreement. French and Ford agreed to speak again as soon as they had spoken with their owners. He stated that he hoped to call her back yet today, and the phone conference ended. The Committee Members continued their discussion once the conference call ended. Champion added that 25 years really is a short time in the life of an investment. She believes they should raise this time frame. Bailey and Champion both stated that they could agree to a two -prong agreement — change of use and redevelopment. Hayek stated that he would like to keep some years on the agreement and suggested the 40-years time frame again. STAFF TIME: Ford stated that right now they are busy with the Jumpstart program for businesses. She also noted that they had their Towncrest meeting and had a good turnout from neighbors. Next they will create a vision to present to the community, which will take 6 to 18 months. She added that Hieronymus Square is slowly moving forward. They hope to have an agreement with Hieronymus in time for the next Economic Development meeting. COMMITTEE TIME: None. ADJOURNMENT: Hayek moved to adjourn the meeting at 8:55 A.M., seconded by Champion. Economic Development Committee Meeting October 13, 2008 Council Economic Development Committee ATTENDANCE RECORD 2008 TERM 1 C, w w A cn oo cD 1 0 NAME EXP. 5n co m -4 N o o w Regenia 01/02/10 X X x X X X X X X X Bailey Matt 01/02/10 X X X X X X X X X X Hayek Connie 01/02/10 X X x x X X X 0/E X X Champion Key: X = Present O = Absent O/E = Absent/Excused INITIAL REVIEW OF ATLAS HOME SERVICE LLC WORKING CAPITAL Business Proposed: Applicants, Leah and John Lee, owners of Atlas Home Service are requesting funds to expand their home based business. The business offers home and property maintenance and repair. Existing services include painting, drywall, plumbing, windows and doors, and general handyman assistance. John began this service on a part-time basis in the fall of 2006 as a sole -proprietorship and by 2007 was able to establish the business as his full time means of employment. The business hopes to expand their services and grow their customer base. They have immediate plans to hire a full time employee this January to support already acquired snow removal contacts. The owner requests $35,000 for working capital such as equipment, uniforms, salary expense and related items to support expansion. The business qualifies as a micro -enterprise under the CDBG program. Both owners qualify as low -to -moderate income persons. A micro -enterprise is a commercial enterprise that has five or fewer employees, one or more whom owns the enterprise. 51 % of the employees and owners must be low -to - moderate income. Budget & Private Financial Contribution The applicant has secured a private loan with First American Bank for $33,250 that will be secured by a deposit account held at the bank. The bank is unable to increase the loan due a collateral shortfall. The owners estimate that the business will need approximately $68,000 to support the expansion. The owners have invested all other income and available assets into the business. Comprehensive Plan/CITY STEPS Plan The project does not require public infrastructure and is located in a residential zone. Applicant must be aware of home occupation regulations. As the stated employee will not work from the home and customers will not frequent the home on a regular basis, the business does not need to obtain a permit for Type B home occupations. That being said, if the business expands and hires more employees, a separate business location may be necessary. Also, commercial vehicles more than 7.5 feet in height can not be stored in residential zones. CITY STEPS notes a high priority for micro -enterprise assistance. The owners plan to expand into a commercial space on Highland Court once cash flows allows. Quality of Jobs The two owners will operate the business and will hire an employee to meet acquired contracts. Job creation/retention is not required under micro -enterprise assistance; however, the owner plans to expand the business and hire an additional two employees in 2009. The starting salary is $10.00 per hour. Health benefits are not offered, however holiday, vacation and sick time will be offered after one year of service. After two years of employment, the company plans to December 2008 offer employees the opportunity to take up to three continuing education courses per year towards plumbing and electrical certifications. Economic Impact The proposed CDBG funds will provide a small, women owned business with access to low interest working capital. Leah owns 60% of the business (LLC). The owners will pay themselves an hourly rate with the anticipation of increasing their wage as sales and operating profits rise. Leah will retain her current job until there is sufficient cash flow to work full time for the business. First American Bank referred the owners to the CDBG fund in order to access additional working capital. Environmental/Community Involvement The business plans to participate in professional organizations such as Chamber of Commerce and anticipates participation in two charity auctions a year by donating a half -day of handyman services. Applicant plans to assist Habitat for Humanity in 2009. The business also plans to work with MidAmerican to install installation eligible for reimbursement by the utility company as will as receive a list of refundable energy efficient upgrades. The business anticipates creating a page on their website dedicated to energy conservation methods. Staff recommendation: $35,000 for working capital with a maximum term of 7 years at 3% interest. Staff recommends as a condition of the award the owners receive additional business assistance regarding items such as financial management and accounting services (payroll/employee issues). The training required would be based on an evaluation by the Small Business Development Center. For security, staff recommends a UCC statement for all business assets and a lien on their rental property to partially secure the loan. December 2008 Iowa City CDBG Economic Development Funds Application for Business Financial Assistance Business Requesting Financial Assistance: Individual John and Leah Lee Home Address 1402 Esther Street, Iowa City, IA 52240 Name of Applicant Business Atlas Home Service LLC Full Street Address of Business 1402 Esther Street, Iowa City, IA 52240 Phone Number & Email Address 319.338.1744, leah@atlashomeservice.com DUNS Number (If awarded funds, applicant must obtain a DUNS number): 010888929 Type of Business Home maintenance and repair Date Business Established October 2006 Bank of Business Account and Address (if applicable): Applying for funds with: Carrie Wagner, First American Bank, 640 Highway 1 West, Iowa City, IA 52246 NOTE: The City will not provide assistance in situations where it is determined that any repre- sentation, warranty or statement made in connection with this application is incorrect, false, misleading or erroneous in any material respect. If assistance has already been provided by the City prior to discovery of the incorrect, false or misleading representation, the City may initiate legal action to recover City funds. Revised 11/15/06 Section 1: Description of Business and Proposed Project 1.1. Describe the proposed "project" (for example, company relocation, building expansion, remodeling, new product line, number of new jobs, amount of investment in machinery and equipment) and the expected benefits it will receive from the financial assistance requested: Atlas Home Service seeks funds to expand its variety and intensiveness of services offered. The current time frame is excellent for becoming a more comprehensive service provider. Both individual and corporate consumers are more likely to employ an already -familiar provider for accomplishment of additional projects than they are to look for a lesser -known narrow -scope provider. With the recent tightening of the economy this becomes especially true as consumers become more cautious in their choice of providers. Further, whereas certain type of services may have a somewhat decreased demand at this time, Atlas Home Service specializes in services which not only are not postponeable, such as plumbing and snow removal, but which actually may pay for themselves within a matter of months, such as improvement of attic and window/door insulation. Many consumers may not be aware that some energy -efficiency projects are in large part reimburseable through energy providers such as MidAmerican and/or through income tax savings. Atlas Home Service will in its publicity help inform consumers, to mutual advantage. This also is a most opportune time for expansion of range and immediacy of services in that Atlas has become increasingly well known and is experiencing a crescendo of inquiries through client -to -client referrals which are known to be more results -producing [and cost-free] than any other form of advertising. It is important that Atlas not only maintain but increase its ability to respond briskly and fully to inquiries because most potential clients want rapid satisfaction of their needs and, if put off for several weeks, are likely to either turn elsewhere or to become disenchanted with having the project done at all. The risk that Atlas might expand too rapidly is reduced by several factors: As mentioned already, its services are needed by a large cross-section of this region's population regardless of economy, weather, season, etc. The bulk of Atlas Home Service's overhead is more proportional to actual billable work available than would be true in many other areas of endeavor. Atlas Home Service does not risk the un-useability of expensive inventory, unlike retail or food - service businesses. Tools of our trade are long-lasting, repairable, and retain excellent marketability should they for any reason cease to be of adequate utility to us. One new full-time employee will be hired immediately to support already acquired snow removal contracts. Funds will also allow for Atlas Home Service to expand on its professional image through the purchase of laptop computers and professional software for on -site estimates and invoices, personalized uniforms, and signage for the vehicles. In April of 2009 another 2 full-time employees will be hired. The additional revenue will allow for Atlas Home Service to secure a physical location in Iowa City outside of the business owners' home. 1218 Highland Court, Iowa City, IA 52240 will be considered for the workspace. 1.2. Provide a brief history of your company Established in the fall of 2006, Atlas Home Service began offering home maintenance and repair services to Iowa City and the surrounding areas. Services included painting, drywall, plumbing, windows & doors, and general handyman assistance. John and Leah used their home for an office and shop location. A client base was developed through telephone book advertisements, Revised 11/15/06 posters on local bulletin boards, and through word of mouth. Strong client relationships allowed for significant repeat business. Approximately 68% of our clients return for more work. As of December 2008, Atlas Home Service has signed winter services contracts with Lincoln Real Estate for 11 properties. Salt/sand application and snow removal will be completed for these addresses, resulting in revenue ranging from $645.00 to $1,175.00 per event. 1.3. Describe the organizational structure of the business: Atlas Home Service is a Limited Liability Company, in the names of Leah and John Lee. 1.4. Management (Proprietor, partners, officers, directors, all holders of outstanding stock, 100% of ownership must be shown) Name & Position/Title Complete Address Owned Leah Lee 1402 Esther Street, Iowa City, IA 52240 60 % John Lee 1402 Esther Street, Iowa City, IA 52240 40 % Attach a brief description similar to a resume of the education, technical and business background for all the people listed under Management. (See resumes enclosed in business plan) 1.5. Will the project involve a transfer of operations or jobs from any other Iowa City or Johnson County facility or replace operations or jobs currently being provided by another Iowa City or Johnson County company? If yes, please indicate the facility(s) and/or company(s) affected. 2153 Revised 11/15/06 Section 2: Financial Contributions to the Proposed Project 2.1. Use of Proceeds (SEE CHART BELOW) USE OF PROCEEDS Tools, tool boxes, and truck signs, for new employee $800 Signs for Truck $300 Uniforms $550 .Technologies $4000 Office supplies $200 Small Tools/Stocked Materials $600 Professional Services $1500 Marketing $1200 Working Capital $59100 Revised 11/16/06 4 2.2. Terms of Proposed Financing (Sources) Monthly Proposed Financing Amount Payment Type(') Rate Term Financial Institution: First American Bank $33,250 $483 Direct Loan 6% 7 year amortization/ 1 year balloon Financial Institution : $ Other : $ Iowa City CDBG Economic Dev. Fund $35,000 $461.31 Direct Loan 3% 7 year i amortization TOTAL: $68,250 (')For example: forgivable loan, direct loan, or grant. 2.3. Explain why assistance is needed from the City, and why it cannot be obtained elsewhere. If the applicant did not apply for a loan through a private financial institution, please explain why. If denied assistance through a financial institution, please attach the letter of denial. Assistance through Iowa City is needed in order to allow Atlas Home Service to expand its offerings to its clients through the utilization of employees, technological upgrades, and a more polished overall company image. Private lenders are able to offer us some assistance, but due to a lack of collateral, matching funds from the City of Iowa City will be required to obtain sufficient capital. 2.4. Indicate the owner's contribution (cash, assets for the operation of the business, etc.) to this project. All of our assets have previously been invested into Atlas Home Service. 2.5. Identify all agencies or institutions involved in the project (financial, technical assistance, etc.) and what their involvement is: Business Advisors: Before beginning Atlas Home Service, Leah attended a class through Kirkwood Community College Continuing Education that informs prospective business owners of legal structure options, sources of capital, basic business records, business taxes, regulations, permits, business insurance, marketing and advertising, Co -sponsored by Kirkwood and SCORE. After completing the course, we set up private counseling sessions with SCORE `Counselors to America's Small businesses.' We have met with our representative, Ann Tompkins, regularly throughout the two years Atlas Home Service has been operating, and will continue to meet with her at least every two months. Revised 11/15/06 A meeting with Paul Heath at the Small Business Development Center has been scheduled for December 15t" 2008 at 5:30pm. Attorney: Holland & Anderson LLP, C. Joseph Holland will represent the business for legal matters. Book-keeper: Iowa Office Services, Deb Stannard, will review our QuickBooks file and process payroll. Accountant: Kenneth Haldeman, PC will file our taxes, and provide any other necessary financial consultant services. Bank: Carrie Wagner with First American Bank and Trust will be providing us with a loan, and as well as other business financial services. 2.6. What type of security will the assisted business provide the City? If no security or less than the dollar amount requested is offered, an explanation must be provided. ✓ Corporate Guaranty ✓ UCC Financing Statement ❑ Irrevocable Letter of Credit ✓ Personal Guarantee ❑ Surety Bonds ❑ Mortgage on Real Estate ❑ Escrow Account ❑ Other: Before execution of a CDBG agreement, if the collateral consists of machinery and equipment, inventory, or other, the applicant must provide an itemized list that contains serial and identification numbers for all articles that had an original value of greater than $5,000. Include a legal description of real estate offered as collateral. 2.7 If the City did not provide financial assistance, could the project proceed? Atlas Home Service would continue to operate however its growth would be inhibited: We would not be able to hire employees, as the operating expenses increase prior to the increase in revenue. The lack of marketing dollars would slow the growth of Atlas' client base. The polished image that Atlas Home Service desires to portray would be delayed without funds to support the project. Section 3: Jobs to Be Created/Retained Special Note: The Community Development Block Grant (CDBG) program requires that at least 51 % of the jobs created or retained must be held by or made available to low - moderate income persons. The business acknowledges that if it fails to create and/or retain the jobs identified below by the end of the project period and maintain them for a period of time (usually 12 months from the date of the award); it may be required to reimburse City funds for the employment shortfall. 3.1 If an existing business, how many employees are currently employed at your Iowa City location? Please attach a copy of the company's quarterly Iowa "Employer's Contribution and Payroll Report" for the most recent quarter. 1, John Lee, owner. Revised 11/15/06 (No payroll reports required) 3.2 Complete the following chart identifying the number of jobs to be created and/or retained based on this specific project. Type of Job and Hourly Rate for Created and/or Retained Positions in First 12 Months of Project Award (please see attached Job Category Definitions) # of Jobs Created # of Jobs Retained Type of Job No. Hours Per Week Hourly Rate of Pay Fringe Benefits* 1 (Leah) Officials & Managers 40 $11.81/hour 1 (John) Professional 40 $24.00/hour Technicians Sales Office & Clerical Craft Workers (Skilled) 3 Operatives (semi -skilled) 40 (each) $10.00/hour Laborers (unskilled) Service Workers *If fringe benefits are provided, please attach a description of all employee benefits provided by and paid for (in full or in part) by the business. 3.3 What is the estimated annual payroll for the new employees resulting from this project? The first operative employee's will begin immediately. The second two operative employees and Leah's salary will begin in April of 2009. Salary projections for 2009 for these four individuals, including a 15% allowance for taxes, totals $89,310.63 3.4 If an existing business, will any of the current employees lose their jobs if the project does not proceed? If yes, how many? Explain why: No. Section 4: Economic & Environmental impact 4.1. What other Johnson County companies could be considered to be your competitors? Small Handyman companies in Johnson County are: All Around Construction, Corridor Home Repair, Home Tender, New Paradigm Handyman, Philips Home Repair, R D Service LC Home Repair, Walter Handyman Services. All of these organizations are operated by a single individual and do not provide the benefits of employees. We have contacted all of the above companies, and discovered that many do not take the time to return phone calls or identify themselves as a business. Atlas Home Service will have many advantages over the standard handyman: A more professional business image including prompt return of phone calls, appropriate voicemail Revised 11/15/06 recordings, acceptance of credit card payments, 24-hour service availability, and a more diverse skill -set and quick time -frame for work completion to be provided through the use of employees. Keil's Maintenance is the only company in Johnson County that is similar to what Atlas Home Service will grow to be. Notably, we did not find Keil's Maintenance listed in the phonebook under handyman or Google Search, but rather specifically looked up their business name due to our familiarity with their company. Keil's Maintenance offers a very similar service to what Atlas Home Service will provide; their pricing structure is very comparable, they offer 24-hour service, and have employees. Keil's Maintenance has been in business for over 16 years. When Leah called Keil's Maintenance, they told her that they are consistently booked up for weeks to months in advance. The market can support both Atlas Home Service and Keil's Maintenance. Clients that currently use a basic handyman will likely prefer to have a more professional business in their homes, and customers that already call Keil's may call Atlas Home Service as well to achieve a faster turn -around time. Effective advertising and a positive client rapport leading to referrals will assure that Atlas Home Service is on the forefront when a consumer is in need of maintenance or repair services. 4.2. Please describe the energy and resource efficiency programs, waste reduction, waste exchange, and recycling programs at your Iowa City operation. As we are seeing more and more demand for alternate fuels and energy saving measures in our society, Atlas Home Service will further its involvement with related upgrades. Installing blow-in insulation is a cost-effective project, and home owners can often be reimbursed for 70% of the cost of the upgrade by their utility company. When doing insulation jobs in the past we have used recycled materials, and will continue to do so. We will be contacting MidAmerican to receive a full list of refundable energy efficient upgrades, and create a page on the Atlas Home Service website dedicated to energy conservation methods. Section 5: Community Involvement, Compliance with Law 5.1 In addition to your normal business activities, does your business contribute or have plans to contribute to the community through volunteer work, financial contributions, or through other means? Please describe. Included in the marketing plan for growth of Atlas Home Service is community involvement through in -kind charitable contributions; we will be participating in two charity auctions a year by donating a half -day of handyman services. John has done some work with Habitat for Humanity in the past, and our business will participate in this organization beginning in the spring of 2009. 5.2 Has the business been cited or found to violate any federal or state statute or regulation within the last five years (including, but not limited to environmental regulations, payroll taxes, Occupational Safety and Health Administration laws, Fair Labor Standards, the National Labor Relations Act, the Americans with Disabilities Act)? If yes, please explain the circumstances of the violation(s). No. Revised 11/15/06 5.3 Has the company or any officer of your company been involved in bankruptcy or insolvency proceedings during the past 7 years from the date of this application? If so, provide the details. Yes. John Lee filed bankruptcy for medical bills incurred from an injury in 2001. At the age of 21 John broke his leg in Colorado one month prior to qualifying for the group health insurance through his employer. Multiple treatments and surgeries were required, and performed at various locations recommended by the physicians. The plethora of creditors each required large minimum payments that were unable to be met. John attempted credit counseling, but the medical professionals refused the offers made by the credit counseling firm. The bankruptcy was completed in Iowa in 2002. 5.4 Are you or your business involved in any pending lawsuits? If yes, provide the case name of the lawsuit, docket number, and city and state where it is pending. No. Section 6: Summary of Required Attachments Check off each attachment submitted. If not submitted, explain why. [X] Business plan (if start-up business) [X] Balance Sheet (3 year historical if an existing business. Start-ups must provide a pro - forma balance sheet) See Business Plan [X] Profit and loss statements (3 year historical if an existing business, 3 year projection for start-ups) See Business Plan [X] 12 month cash flow statement (if the business does not expect to turn profitable within the first 12 months, provide a cash flow statement extended to the year the business expects to turn profitable) See Business Plan [ ] Description of fringe benefits provided to employees, if applicable N/A [X] Brief description of the education, technical and business background for all the persons listed under Management (Question #1.4) See resumes enclosed in Business Plan [ ] Please provide the social security numbers for all the persons listed under Management (Question #1.4) Please see Carrie Wagner at First American Bank [ ] If an existing company, copy of the company's quarterly Iowa "Employer's Contribution and Revised 11/15/06 Payroll Report" for the most recent quarter. N/A- This report has not been required, Atlas Home Service was a Sole -Proprietorship until November 2008. Construction loans only: Cost estimates for construction and a statement of the source of any additional funds N/A [Xj Include a list of any machinery or equipment or other non -real estate assets to be purchased with the financial assistance and the cost of each item as quoted by the seller. Include the seller's name and address. Upon review of a submitted application, the City reserves the right to request additional information in order to assist the City with its evaluation of an application. Release of Information and Certification NOTE: Please read carefully before signing I hereby give permission to the City of Iowa City (the City) to research the company's history, make credit checks, contact the company's financial institution, and perform other related activities necessary for reasonable evaluation of this proposal. I understand that all information submitted to the City relating to this application is subject to the Open Records Law (1994 Iowa Code, Chapter 22) and that confidentiality may not be guaranteed. I hereby certify that all repre- sentations, warranties or statements made or furnished to the City in connection with this application are true and correct in all material respects. I understand that it is a criminal violation under Iowa law to engage in deception and knowingly make, or cause to be made, directly or indirectly, a false statement in writing for the purpose of procuring economic development assistance from a state agency or political subdivision. If applican is a pr prietor or q eral partner, sign below. C/ BY Date:_ b If applicant is a Corporation, sign below: Corporate Name and Seal Date By: Attested by: Signature of President Signature of Corporate Secretary Revised 11/15/06 10 ATLAS HOME SERVICE Taking the weight of maintenance & repair off your shoulders! Include a list of any machinery or equipment or other non -real estate assets to be purchased with the financial assistance and the cost of each item as quoted by the seller. Include the seller's name and address Uniforms Imprinted Sportswear $550 961 Miller Ave # 1 Iowa City, IA 52246 319 337-2685 2 Laptop Computers w/ software Best Buy $3200 1431 Coral Ridge Ave Coralville, IA 52241 319 625-2900 _ 1 Portable Printer Best Buy $300 1 Digital Camera Best Buy $300 Accessories for portable protection of Iowa Book & Supply $200 business machines. 804 S Capitol St Iowa City, IA 52240 319 337-8376 Office Supplies Staples $200 911 Highway 1 W Iowa City, IA 52246 319 466-0335 Signs for Truck Advance Design Print $300 Company 1713 2nd St Coralville, IA 52241 319 337-5602 Tool Boxes for Trucks Lowe's $250 2701 2nd St Coralville, IA 52241 319 545-8300 Tools to Stock Truck Tool Boxes Menard's $250 1375 Highway 1 W, Iowa City, IA 52246 319 358-9708 Office: 319.338.1744 • Emergency: 319.400.6359 • Email: leah@atlashomeservice.com Mailing Address: 1402 Esther Street • Iowa City, IA 52240 Atlas Home Service Business Development Proposal John and Leah Lee 1402 Esther Street Iowa City, IA 52240 319.338.1744 Leah@atlashomeservice.com Table of Contents Executive Summary . 1 Section I: The Business Business p. 2 Service p. 2-3 Market p. 3-4 Location p. 4 Competition p.4-8 Professional Services p. 8-9 Personnel P. 9 Management P. 9 Section 11: Financial Data P. 10-11 Section III: Marketing Plan Objectives p. 12-13 The Market p. 13-14 Competition p. 14-15 Marketplace Trends 15 Marketinq Mix p.15-16 Strategy and Execution p. 17-21 Marketing Results p.21 Section IV: Documentation List p. 22 Executive Summary The Business Atlas Home Service, established in 2006, is a maintenance and repair company offering superior service with competitive pricing to clients in Iowa City, IA and the surrounding areas. Services A wide array of services will be offered to the clients of Atlas Home Service, including: • Handyman Assistance • Universal Accessibility, • Energy Efficient Upgrades • Home Inspections • Deck & Fences • Painting • Drywall & Carpentry • Plumbing • Electrical & Lighting . Windows, doors, and siding • Remodels • Winter Services The Market The demand for repair service is independent of the state of the economy; maintenance and repair are mandatory components of every home and business. Services are offered within a 20 mile radius of the Iowa City, IA zip code 52240. The following segments are currently targeted: • Established professional families that often don't have the time to complete the repairs themselves • Senior and mobility impaired citizens • Property management companies Location Atlas Home Service has operated as a home -based business. John and Leah have an office located within their residence, and use their garage for a workspace. In April of 2009 a commercial location will need to be secured to accommodate additional employees. Competitive Edge Atlas Home Service will possess many advantages over the competition, such as; • Professionalism • Technological Aptitude • Company Image • Strong Client Relationships • Community Involvement Personnel and Management Currently Atlas Home Service is comprised of John and Leah Lee. One employee will be added in November 2008, two in April 2009, one in April of 2010, and one in January of 2011. John and Leah Lee will manage the company. John will be the primary service provider, as well as the direct supervisor for all maintenance personnel. Leah will provide administrative support for Atlas Home Service. Marketing and Financial Based on the hiring of employees, and on the advertisement campaigns and public relations agendas that have been established, Atlas Home Service expects to see the pre-tax profits of the business grow from $28,616.66 in 2009, to $101,050.78 in 2010, to $154,136.58 in 2011. Section I: The Business The Business Atlas Home Service offers home and property maintenance and repair. John Lee began this service -based company on a part-time basis in the fall of 2006 as a sole -proprietorship. In February of 2007, John was able to establish Atlas Home Service as his full-time means of employment. He offers his clients a set of highly developed skills, a wide array of available services, quality guaranteed work, and 24-hour availability. The professional communications offered by Atlas Home Service are a large asset, helping to build client rapport and set the company apart from standard handyman services. Accurate estimates and invoices generated using computer software, documents prepared on company letterhead, dedicated phone lines with voicemail recordings that clearly state the business name, and strong interpersonal communication abilities, have all assisted in developing a strong client base. In the two years that Atlas Home Service has been operating, the market has shown vast room for growth. The business has converted to a Limited Liability Company for liability protection, and to allow for future expansion. Employees will be added in order to meet the growing cliental and their demand for service. Atlas Home Service will immediately build upon its initial offerings of professionalism to include a more polished overall image. John, as well as all other employees will begin wearing uniforms, the trucks will display the company information, and John will use a laptop and portable printer to offer clients immediate estimates and invoices. Service A wide array of services will be offered to the clients of Atlas Home Service; if a client has a request that is not listed, we will evaluate the need and complete the work if it is feasible. Below is a list of services that are offered through Atlas Home Service on a regular basis. Plumbing Repair/replace fixtures, leaky faucets, drain clearing, sump pump replacement Bathroom & Kitchen Remodels Cabinets and vanities, counter -tops, faucets, garbage disposals, tub/shower units Carpentry Trim & molding, custom storage, drywall work Decks and Fences Moisture and weather sealant, repairs, rebuilds Electrical and Lighting Replacement of outlets, light fixtures, and ceiling fans Windows, doors, and siding Doors, windows, lock -sets, installations and replacements Energy Efficiency Insulation, fixture replacements Painting Interior and exterior Universal Accessibility Shower bars, wheel -chair accessible showers and sinks, ramps Winter Services Snow removal, salt and sand services Home & Building Services Appliance installation, concrete, gutter cleaning, seasonal maintenance, handyman assistance, home inspections 2� Although these services are available from others in the area, Atlas Home Service is unique in its loyal client base, outstanding service, and its professional image. Also unique to our company is the emphasis on universal accessibility options. Atlas Home Service will further its work with this market segment. Research will be conducted in regards to the needs of the aging and mobility impaired community, and ad campaigns will be conducted accordingly. In the winter of 2008-2009 we will be contacting the Johnson County Coalition for Persons with Disabilities and the Senior Center Director to evaluate needs, as well as to determine ways in which we may serve this segment of the community. As we are seeing more and more demand for alternate fuels and energy saving measures in our society, Atlas Home Service will further its involvement with related upgrades. Installing blow-in insulation is a cost-effective project, and home owners can often be reimbursed for the cost of the upgrade by their utility company. We will be contacting MidAmerican to receive a full list of refundable energy efficient upgrades, and create a page on the Atlas Home Service website dedicated to energy conservation methods. Market The demand for maintenance and repair services is steadily growing regardless of the current state of the economy. Repair needs are not an optional budgetary item. Atlas Home Service will service two major market segments: homeowners and property management firms that are in the 20 mile radius of Iowa City, IA zip code 52240. Small local businesses other than property management firms are also a possible market segment for future expansion. Homeowners who are unable to perform home maintenance and repair duties on their own are a growing population: both as the average life expectancy increases and as social trends require more and more people to work excessive hours outside of the home. Key segments for Atlas Home Service are: 1. Professional households. Because of career demands these owners often do not have the time or skill to complete home improvement and repair projects themselves. 2. Senior and mobility impaired citizens who seek universal design and accessibility options such as handicap accessible showers and wheelchair ramps, and who also need assistance with standard home maintenance and repair projects due to physical limitations. In a college town such as Iowa City with a large rental population, the opportunity to contract with landlords and property management firms is large, due to the population increase of approximately 30% when school is in session. Every year the University of Iowa sees a larger freshman class than the year before, indicating growth in the property management segment. Atlas Home Service has a current contract with Lincoln Real Estate of Iowa City to provide general maintenance services. Their needs are continual, and will support more hours than we have previously had available for them. Lincoln Real Estate has requested that we hire an employee to work independently when John is not available. 3(. We do not currently plan to solicit our services to other property management firms, but rather place the concentration on the home owner segments of the market for the following reasons: ■ The direct hourly income is higher ■ Atlas Home Service places bids for residential jobs rather than billing hourly, giving us more flexibility in our rates ■ Our niche in the industry is more specific to residential services; home owners that deal directly with their maintenance/repair personnel have' a higher concern for the level of professionalism, and the target group of senior and mobility impaired citizens can be more acutely targeted Location Atlas Home Service has operated as a home -based service organization since its conception in the fall of 2006. John and Leah have an office located within their home at 1402 Esther Street, Iowa City, IA 52240, and use their garage as a workspace. With the first employee, to be hired in November of 2008, no physical location will be required. The additional vehicle will be kept at the residential premises, and the garage can hold the additional tools and equipment the employee will need. In April of 2009, two additional employees will be hired. The new and existing employees will require a physical off -site location within Iowa City. This building will function as a workshop, storage for vehicles and equipment, and a daily location for John to meet with the employees. The office will likely remain in John and Leah's home to minimize the expense of the physical location. Competition Direct Competition The companies listed below have been identified as direct competitors of Atlas Home Service. These businesses were found through Yellow Book, Dex, and Google search. We attempted to call each company and inquire about what they have to offer. The results of our research are displayed in the tables below. All Around Construction (Iowa CV): Call went straight to voicemail, the message just said `this is Peter', no business name. Never returned phone call. No further information available. is & u Home Services (Riverside): voicemail had no recorded greeting. Never returned phone call. No further information available. 41 Corridor Home Repair (Swisher): Employees No Rates $45.00 hourly. Minimum One hour Additional Charges/Materials $25.00 to go get materials, within reason. Estimates Free for now, may start charging then subtract from bill if work is completed. Emergency Service No Service Exclusions No exterior windows and door Drywall Doctor and More Iowa City): Never returned phone call. No further information available. Handyman Services (West Liberty): Called, wife answered and directed me to call husband's cell phone. Left message on cell phone. Never returned phone call. No further information available. Home Tender (Iowa City): Voicemail recording did not state business name Employees No Rates $30.00 hourly for handyman. $50.00 hourly for computer work. Minimum One hour Additional Charges/Materials Hourly rate to fetch materials Estimates Free for first visit Emer enc Service Not often, doesn't have fee schedule. Service Exclusions No gutters, snow removal, high-up obs, doesn't rewire. New Paradigm Handyman (Iowa City): Voicemail recording did not state business name Employees No Rates $20.00 hourly for most jobs. Minimum No. Additional Char es/Materials Hourly charges apply for fetching materials. Estimates Free Emergency Service Occasionally... same rates. Service Exclusions No. Philips Home Repair (Iowa City): Employees No Rates $35.00-$45.00 hourly. Minimum One hour Additional Charges/Materials Hourly rates apply to fetch materials Estimates Yes, free Emergency Service No Service Exclusions Repairs all, doesn't do construction from scratch. 5 -" R D Services LC Home Repair (lows City)- Employees No Rates $30.00 hourly. Never bids. Minimum One hour. Additional Charges/Materials He purchases materials and charges time to shop. Estimates No. Emergency Service Yes, same rates. Service Exclusions No water heaters, new wiring, snow removal. Walter Handvman Services (North Lihorty) Employees No. Rates $45.00 hourly. Minimum One hour. Additional Charges/Materials Clients can select materials. He charges $25.00 fee to -pick-up materials. Estimates Yes, free. Emergency Service Yes, $65.00 after hours. Service Exclusions No. Given the number of businesses that did not take the time to return phone calls or identify themselves as a business it is assured that Atlas Home Service will have many advantages over other handyman companies. We will offer a more professional business image including prompt return of phone calls, appropriate voicemail recording, acceptance of credit card payments, 24-hour service availability, and a more diverse skill -set and quick timeframe for work completion to be provided through the utilization of employees. Notably, we did not find Keil's Maintenance listed in the phonebooks or Google Search, but rather specifically looked up their business name due to our familiarity with their company. Keil's Maintenance offers a very similar service to what Atlas Home Service will provide; their pricing structure is very comparable, they offer 24-hour service, and have employees. Keil's Maintenance (Iowa Citv): Employees Yes, employees perform most of the work; owner completes estimates. Rates $45.00 hourly per man. Sometimes more for complex projects. Minimum One hour Additional Charges/Materials Keil's purchases materials, puts into estimate/hourly rate. Estimates Yes, free. Emergency Service Yes, 24 hour service available. Additional $10/hour. Service Exclusions No- does everything. Would refer if work couldn't be done. Keil's Maintenance has been in business for over 16 years. When Leah called Keil's Maintenance, they told her that they are consistently booked up for weeks to months in advance. The market can support both Atlas Home Service and Keil's Maintenance. Clients that currently use a basic handyman will likely prefer to have a more professional business in their homes, and customers that already call Keil's may call Atlas Home Service as well to achieve a faster turn -around time. Effective advertising and a positive client rapport leading to referrals will assure that Atlas Home Service is on the forefront when a consumer is in need of maintenance 61 or repair services. Indirect Competitors Minimal investigations have been completed into the indirect competitors: carpenters, plumbers, electricians, general contractors. The current research shows these groups charging approximately 25% higher rates than Atlas Home Service at an average rate of $60.00 per hour. Further research will be conducted in this area as Atlas Home Service grows. The continuing education category of our financial projections will allow for John and his employees after two years of service, to take courses to obtain journeyman status for electrician and plumbing certifications, deeming this competitive angle more applicable. Competitive Edge Atlas Home Service has several advantages over the competitors. Our phone calls to the competitors and discussions with consumers of our services have indicated that the area of professionalism is drastically over -looked in the maintenance and repair industry. A professional image will assure comfort for our clients. They will be more apt to be at ease with our service providers who may work unsupervised in their homes. Homeowners will have more confidence in the quality of work being provided, through accurate billing and after -care. We will continue to provide as well as enhance the professionalism delivered to our clients in the following ways: Professional verbal Communications. John and Leah are both highly experienced in public relations and interpersonal skills. When interviewing potential employees, it will be crucial that all employees demonstrate a level of professionalism that reflect Atlas' business image positively. Voicemail recordings will always state our business name. Our clients have told us that a common frustration they have with handyman companies is difficulty in reaching the business, and in receiving return phone calls. To our clients we will express our level of professionalism and dedication by offering a telephone line exclusively for business purposes, with a recorded greeting providing them with a timeframe in which they can expect a return phone call. The recording will state: "Thank you for calling Atlas Home Service! Due to the nature of our business, we are not always able to answer the telephone immediately. Please leave a detailed message including your name, phone number, and the nature of your call, and we will return your call by the close of the next business day. If this is an emergency, please call 319.400.6359 and leave a message indicating the urgency of your situation and we will call you back as soon as possible. Thank you for calling Atlas Home Service. We look forward to serving you." Consistent, clear, documents. Atlas Home Service will use QuickBooks for providing estimates and invoices to clients. This will allow for consistent and clear billing (see enclosure). Leah's experience with Small Business document development will assure professional and concise materials: ■ A personalized letterhead will be used for all Word documents and written communications with clients ■ Estimates will be sent to new clients with a cover letter, welcoming them to Atlas Home Service and letting them know how our business aims to stand above the rest. (See enclosure) ■ Job Ticket forms have been developed for all employees to use. This form will be hold the contact information of the client, the exact details of their service request, and serve as a time sheet for the job. This form will make certain that all employees have the 7� pertinent information when going to a job site, and that management may property evaluate the productivity of a job based on the time that was required to complete the work. (See enclosure) Campaigns to be developed going forward will show the benefit of experience. Leah has developed advertisements using digital photography, client follow-up surveys, and composed numerous other business letters and documents; our clients will continue to respond to the level of professionalism that is demonstrated in polished products. Visual Image. All work vehicles will be identified with the business name, phone number, website, and logo. Employees will be required to wear uniforms; this will allow clients to identify the Atlas Home Service employees. Employees will carry business cards which will include the business name, logo, and contact information. Community Involvement. Atlas Home Service will participate in professional organizations such as the Better Business Bureau and Chamber of Commerce, showing reputability in our company. A connection to the local community will be built through involvement with local charitable organizations. Technological Aptitude. QuickBooks for Contractors is currently in use to produce accurate and consistent estimates and invoices. The program offers many features that we have not yet utilized. We have begun to classify new clients by how they were obtained, to give us a way to track the effectiveness of our advertising strategies. Leah will take QuickBooks instructor led classes within the next six months to learn to further benefit from the program's offerings. John will begin carrying a laptop, portable printer, and digital camera. This will offer many benefits: ■ Immediate estimates, resulting in more timely scheduling of jobs ■ On -site Invoicing, cutting down on cash flow and accounts receivable issues • Immediate gratification for the customers ■ Before and after photos for our website, and as keepsakes for our clients ■ Instant production of home inspection reports for real estate and insurance evaluations. ■ Access to live scheduling data, allowing for John to set repeat appointments with clients. Client Rapport, The composite of above listed competitive advantages will prove to establish a level of client rapport previously unknown to the handyman service field in the Iowa City area. In this industry it is very common for friends and neighbors to ask one and another for trusted service providers; the secured status of Atlas Home Service will lead to recommendations, furthering our client base. Existing clients will contact Atlas Home Service for increasing amounts of home projects, knowing they can trust in the business' strength. Professional Services Business Advisors: SCORE, Counselors to America's Small businesses, have assisted us in developing a complete and accurate business plan. We will continue to meet with our advisors at least every two months. In addition, an appointment with Paul Heath at the Small Business Development Center has been set for December 15tn 2008. Attorney: Holland & Anderson LLP, C. Joseph Holland, has converted Atlas Home Service to an LLC and will continue to represent the business for legal matters. 8�.: Book-keeper: Iowa Office Services, Deb Stannard, will review our QuickBooks file and process payroll. Accountant: Kenneth Haldeman, PC will file our taxes, and provide any other necessary financial consultant services. Personnel Atlas Home Service will add its first employee in January 2009. This will be necessary in order to complete snow removal, to allow for larger projects, and to begin building the company's client base. In April of 2009 two more employees will be added; spring and summer months often produce requests for large jobs, requiring two -person teams. Employee rules and regulations have been developed. (See enclosure) Management Atlas Home Service will be managed by John Lee and Leah Lee. There is great value in the different and complimenting skill -sets that John and Leah bring to the business. (See enclosed resumes) John has an extensive and applicable background involving professional experience in the maintenance and repair fields, customer service and telephone skills refined through professional use, advanced technological aptitude, and development of sales strategies. Leah has experience with administrative support and business operations in both large and small settings, including public relations, hiring and personnel procedures, team building activity and employee support, file and record organization, development of business documents and forms, computer operation, and product/service evaluations. John Lee will serve the company as Primary Service Provided, and Maintenance/repair Supervisor. John's duties will include: ■ Initial consultations with new clients ■ Evaluation of clients projects to accurately provide estimates ■ Business scheduling ■ Primary Service Provider, with emphasis on the more complex projects ■ Employee interviews and skill assessments ■ Employee evaluations Leah Lee will serve the company as Operations Manager. Leah's duties will include: ■ General administrative functions ■ Estimate and invoice forms ■ Resolution of client conflicts ■ Assist John in the interview and hiring process ■ Conduct ongoing market research ■ Evaluate current and develop new advertising strategies 9-. ■ Review and update the business plan every six month for the first 5 years, and annually beginning the 61n year Section Il: Financial Data Funding Personal finances and credit cards have been used to support the business up until this point. This has created issues with the mixing of personal and business transactions, as well as contributing to an inadequate cash flow. A business loan will remedy the cash flow obstacles and allow us to keep the business entity of Atlas Home Service entirely separate from the family income and expenses, allowing for more accurate financial data. A personal budget has been included, demonstrating that the salary which Atlas Home Service will be paying John and Leah will be adequate to support their personal expenses. The increased business funding coupled with our detailed company agenda will permit Atlas Home Service to expand into a strong maintenance, repair, and home improvement company in the Iowa City area. A loan amount calculations sheet has been included, detailing the initial start-up expenses, and showing the monthly operating expenses multiplied by three months. Balance Sheet Two balance sheets have been included. The first was printed from our QuickBooks file; the second demonstrates our personal financial data, joined with our business balance sheet, to show our total net worth. Profit & Loss Statement A profit & loss statement has been included from our QuickBooks file, showing a previous year comparison of the year-to-date figures. For the time period January 1 st through October 26`n the net income of 2008 is 60% higher than 2007. Financial Projections Projections have been developed for January 2009 through December of 2011; a summary of the three year term, as well as detailed figures broken down by month. Included in the financial projections are approximated loan payments: To the City of Iowa City, the loan payment was based on $35,000.00 amortized for a 7 year term at 3% interest. For First American Bank, the loan payment was calculated for $33,250.00, 7 year amortization/1 year balloon, with payments beginning in June 2008. Revenue Projections ■ Income was calculated based on hours. For all employees other than Leah, it was assumed that each employee will work an eight hour day ■ Out of each day, 6.25 hours will be billable in January, and 6.5 hours will be billable going forward from that point. This ramp up time will allow for stabilization of daily routine 10�>. ■ We viewed calendars of each month of the three year projections, and calculated the number of working days, by taking into account weekends and holidays ■ Working days/hours were multiplied by average income rates (mean of hourly residential and property management rate): $40.00/hour Jan. `09 — March '10, $50.00/hour April 10 — March 11, $55.00/hour April 11 — Dec. 11 ■ Three training days for each new employee were taken into account ■ Sick and vacation time benefits were subtracted out ■ For Leah, we are assuming that 30 of her weekly hours will be needed in the office, and that a flat 10 hours a week will be billable Salary Projections ■ John's and Leah's salaries were established at flat rates ■ The employees will be paid $10.00 per hour to start, with approximated raises of $0.50 per year ■ The first employee will receive a $0.50 raise after 6 months; we will be offering this to them up front as a benefit because the responsibility level will be higher and more on - call hours will be required before the addition of the other employees ■ To obtain approximate salary costs, we utilized their hourly wage, an eight -hour work day, and the same available work days out of the months that were used for income figures. 15% was added to this number for taxes ***Note: Revenue and Salary Projections do not include seasonal work, which does often incur overtime and increased revenue that will be greatly beneficial to Atlas Home Service. Due to the inconsistent nature of this income category, we have deliberately eliminated seasonal work from all projections. Section III: Marketing Plan Objectives Employees a. By the end of January 2009, Atlas Home Service will have hired its first employee. This will give the flexibility necessary to contract for large snow removal jobs, as well as support the business growth that affective marketing solutions will begin to deliver. b. In April of 2009, two additional employees will be hired. This will create two, two - man teams. Larger jobs, such as full deck construction, will then be possible. c. Leah will take QuickBooks for Contractors courses within the next six months to learn to best utilize the many offerings of the program. d. It is projected that Leah will become a full-time employee for Atlas Home Service in April of 2009, to provide the necessary administrative support for the increased workload of four employees. 2. Pre -Tax Profits a. 2009 $12,182.30 b. 2010 $87,514.42 c. 2011 $141,084.22 3. Clients a. Focus will be placed on enhancing the amount of work we do for each client rather than dramatic increases in our overall client base. b. Atlas Home Service will plan to support its necessary revenue with 75% higher income levels per client, and 25% increases in the client base. 4. Competition a. During 2009 Atlas Home Service will increase its presence in the marketplace distinguishing itself from the basic handyman service, by consistently providing the professionalism and outstanding service our clients deserve. b. In 2010, the indirect competition will become a larger part of the picture. John will have begun taking classes towards earning industry certifications. In 2010 much more in-depth research will be conducted into the indirect competition and how Atlas Home Service can best place itself in the larger market. 5. Marketing Agenda a. Immediately increase our client retention and the average dollar worth of each client by utilizing the techniques listed under the heading client retention below. b. Continue work with Lincoln Real Estate. Snow removal contracts have been obtained. 12� c. Place our pre-existing posters on bulletin boards in six different locations around the Iowa City area in December. d. Create a page on our website targeted directly towards energy conservation in December 2008. Add another webpage to target the caretakers of senior and mobility impaired citizens in January 2009. e. Join the Chamber of Commerce and Better Business Bureau before the end of February 2009. f. Conduct an interview with the director of the senior center by the end of February 2009 to evaluate how we may further serve their community and the possibilities of hosting a non-profit event. g. In April of 2009, introduce tri-fold brochures advertising for home inspection services, energy efficiency renovations, and universal accessibility options. Distribute brochures to local businesses such as real estate companies, elder service organizations, support groups, and medical supply stores. h. Donate a '/z day of handyman services to two charity auctions in 2009. i. During the Spring and Summer of 2009 contribute hours to Habitat for Humanity. j. Immediately begin utilizing new client forms, allowing us to accurately track where each new lead was obtained. This will give us statistics to guide us in the use of future marketing dollars. The Market Atlas Home Service currently provides service to two markets: homeowners and property management firms that are in the 20 mile radius of Iowa City, IA, zip code 52240. The twenty mile radius includes the towns of Iowa City, Coralville, North Liberty, Tiffin, Oxford, Solon, West Branch, and Hills. We have previously done work in West Liberty, but determined this to be too far to be adequately cost-effective. Regardless of the state of the economy home owners and property management companies require repair and maintenance services. Small local businesses other than property management firms are also a possible market for future expansion, as their needs are too continual. Atlas Home Service currently contracts with the property management company Lincoln Real Estate of Iowa City. Their needs are continual, and will support more hours than we have previously had available for them. Lincoln Real Estate has requested that we hire an employee to work independently when John is not available. There are nineteen total property management companies in the designated service area listed in the Iowa City Dex & Yellow Pages telephone books. We do not currently plan to seek additional work with property management firms other than Lincoln Real Estate; the following rationale was used to make this decision: 13� ..;_� The direct hourly income is higher for residential jobs When working residential jobs Atlas Home Service more frequently places bids rather than billing hourly, giving us more flexibility in our rates Our niche in the industry is more specific to residential services; home owners that deal directly with their maintenance/repair personnel have a higher concern for the level of professionalism, and the target group of senior and mobility impaired citizens can be more acutely targeted Emphasis will be placed on expanding the homeowner market base. Within the homeowners market two major segments have been identified: professional families and senior/mobility impaired citizens. The first group is made up of professionals whom due to careers often do not have the time or the skill to complete home improvement and repair projects themselves. Our experience has indicated that the majority of our current clients are professionals within the community. Professional families with careers frequently have skill sets that are developed in very specific areas, not leaving them with the knowledge to complete home repairs. The career oriented group also often does not have the time to complete repairs independently. As of 2005 in our service area, there is a total population of 168,748 people. This population percentage has grown by 5.36% from the year 2000 to 2005. Within the 168,748 people, 41,622 have a bachelor's degree or higher (24.7%). The second segment is senior and mobility impaired citizens that seek universal design and accessibility options, and often need assistance with standard home maintenance and repair projects due to physical limitations. Out of the total population of the area, 31,996 citizens are over 65 years of age or are qualified disability status (19%). Viewing the home owner market base in regards to households also provides valuable information. There are 66,933 households as of the year 2005, an average household size of 2.5 people. The household population has grown by 6.63% from 2000 to 2005. 31,273 of these households are earning $50,000 or more per year. Competition In the Iowa City yellow book and Dex directories we found a total of 10 handyperson companies. We are aware of Keil's Maintenance company, however we had to look this company up by name because they are not listed in the yellow pages under handyperson services. Out of these ten companies, six did not return out phone calls or did not identify their business in the voice message. Keil's Maintenance offers a very similar service to what Atlas Home Service will provide; their pricing structure is very comparable, they offer 24-hour service, promote a professional business with name recognition, and were the only company we found that has employees. 14 Keil's Maintenance has been in business for over 16 years. When Leah called Keil's Maintenance, they told her that they are consistently booked up for weeks to months in advance. The market can support both Atlas Home Service and Keil's Maintenance. Clients that currently use a basic handyman will likely prefer to have a more professional business in their homes, and customers that already call Keil's may call Atlas Home Service as well to achieve a faster turn -around time. Effective advertising and a positive client rapport leading to referrals will assure that Atlas Home Service is on the forefront when a consumer is in need of maintenance or repair services. Marketplace Trends Atlas Home Service has observed many seasonal trends. In the winter months, indoor projects are primarily requested. Drywall, painting, and kitchen/bathroom remodeling, comprise a large portion of our workload. Snow removal and salt and sand treatments are also specific to winter months. In the spring, we receive more inquiries about our services from new potential clients. The upcoming warm weather, as well as tax returns, may contribute to this. Summer months bring large outdoor projects, such as concrete, fence treatment and installation, and deck work. Apartment changeovers take place during the end of July, and have resulted in a large boost in the general home & building services category from Lincoln Real Estate. Continuous tracking using itemization within the QuickBooks for Contractors program will be utilized, allowing us to direct advertising campaigns to suit the needs of each market trend. Advertising will be done in advance of each trend, which will assist in scheduling a workload most appropriate for the current seasonal state of the industry. Marketing Mix 1. Product/Service. Atlas Home Service offers its clients a wide variety of services. The availabilities will increase after employees have been hired. Larger jobs, such as full deck rebuilds, require more than one consistent worker; Atlas Home Service will be able to offer more than the average handyperson service by having the flexibility of reliable help. 2. Price. Our rates are similar to that of the competition. Currently, we charge: a. Property management companies $35.00 per hour + materials b. Residential jobs that will be under $300.00 + materials will be billed at $45.00 per hour. c. Residential jobs that will be over $300.00 + materials will be considered small projects rather than hourly, and estimated at a flat project rate. When preparing 15 �: r the estimate for the customer, we will estimate the time taken to complete the project at the $45.00 per hour rate, add a 25% margin for unexpected time expenditures, and bill materials as a separate line item on the invoice. 3. Place. The 49,007 people in the twenty mile radius of zip code 52240 that fall into the segments of professional and senior/mobility impaired citizens will provide plenty of opportunity for Atlas Home Service to grow its client base. The physical location of the shop will not be of importance, as this address will not be available to clients. A PO Box will be maintained; this will avoid concerns with the exterior image of the shop, prevent the liability issues that arise with public locations, and also provide for a more secure receipt of payments. 4. Promotion. Atlas Home Service has not advertised a great deal in the last two years, the ease of finding work came as an obliging surprise. Unfortunately, we did not have sales tracking measures in place, and therefore did not complete as much work as should have been done to build revenue. The lack of sales tracking measures also inhibited us from aptly analyzing the exact effectiveness of each of the advertising campaigns. Advertisement campaigns include: a. Website. www.atlashomeservice.com is an established website which receives traffic and offers clients the option to contact us directly through the website. b. Phonebooks. Currently we have the business name and telephone number listed in the white pages as well as an advertisement in the yellow pages, both in Dex and the Yellow Book. c. Door -to -Door Flier Distribution. In the past we have tried distributing flyers door- to-door, which created some new business though did not prove to be as time/cost-effective as other methods of advertising. In spring of 2007 after the large wind and ice storm, we took flyers to advertise door-to-door specifically for yard work in conjunction with the storm; this proved to be successful at a higher rate than general flyer distribution. In the future we will consider distributing a flyer only if a specific need presents its self. d. Posters on Public Bulletin Boards. Advertisements placed on bulletin boards around the Iowa City and Coralville areas have been very effective. A poster has been created showing our business name, slogan, logo, contact information, and available services. The poster has a pocket holding business cards for the clients to remove and take with them. 5. Positioning. The price and place angles are on par with the competition, service and promotion will set Atlas Home Service apart. a. Our experience, both with our clients as well as research into the competition, has shown that professionalism is a trait that is greatly overlooked in the handyperson service industry. Atlas Home Service will display a business image that surpasses all other competitors with its clear documents & billing, professional verbal communications, community involvement, and visual image. b. Atlas Home Service has done very little advertising since it began in fall of 2006. It will build itself as the premier home maintenance and repair company in the Iowa City area by combining its superior professional service with an advanced marketing agenda to continually build both its client base and level of services provided for each individual client. 16�:;�;. Strategy and Execution Advertising Telephone Book Ads. Atlas Home Service currently has its business name and telephone number listed in the white pages, under the drywall contractor heading in Dex, under plumbing in the Yellow Book. We also have a 1.5" in -column box ad in both the Yellow Book and Dex telephone books, under Handyperson Services. The cost for each phonebook ad is $50.00 per month, for a total of $100.00 per month projected for telephone book ads. The majority of our new clients find our information in the telephone book, proving this to be a very effective way of spending marketing dollars. ATLAS HOME SERVICE Tilting the aveight of rn ainten ance & repair off your shoulders! Free Estimates * Guaranteed Work 24-Hour Service Fully Insured and Certified 319.338.1744 www.atlashotneservice,eorn Posters on bulletin boards. The posters that are mentioned above in the marketing mix section under promotion will be placed again immediately after hiring an employee. The only goods required to make the posters are colored card stock, black scrap -booking envelopes, glue, business cards, and thumbtacks. All printing and assembly can be done by us. The total cost for materials and fuel will be under $10.00 per month. We tried placing our posters on eighteen different bulletin boards, and found the following locations to be the most effective. These will be the locations we target: ■ New Pioneer Co-op, Iowa City ■ New Pioneer Co-op, Coralville ■ Mall Drive Ace Hardware ■ Hy-Vee Drug Town ■ North Dodge Hy-Vee ■ Nagle's Website. www.atiashomeservice.com is hosted through Microsoft Office Live, a free beta program. This cost-effective marketing solution brings in new clientele to Atlas Home Service, and allows us to review reports showing visitors per month, keyword reports, and referring sources. On average, our website receives 39.83 visits per month. Google is the referring source for the vast majority of the visitors. The keywords report shows that the majority of visitors found us through our business name, searching for an Iowa City handyman, a painter, 17 �: or a drywall contractor. We advertise a discount on the homepage for a promotion, and change it monthly to keep the attention of repeat visitors. Considering the information regarding the keyword searches, and that painting and drywall are largely winter projects, we will be using the website to promote these two service items for the winter of 2008-2009. Energy efficiency has been a growing concern among the public, and the free website will be used to further raise awareness of the available related home upgrades. A page will be created devoted entirely to energy conservation methods. We will contact MidAmerican Energy and obtain a list of services which they will compensate home owners for enhancing, such as insulation installation. The senior and mobility impaired market segment will also be more directly targeted through their caretakers by use of our free website by creating a unique page. This page will show potential universal accessibility options that will increase the individual's independence within his or her home. Business Referrals Developing relationships with other service providers and local businesses will provide another avenue for referrals as well as marketing material distribution. Tri-fold pamphlets will be developed to target specific market segments. For each pamphlet, only half will be devoted to the specific issue, leaving the other half to let potential clients know about the broader scope of available services from Atlas Home Service. Each brochure will include a coupon to help the businesses feel that this is a valuable use of space. 1. Home Inspection Services. John will be able to provide home inspection services for potential home buyers and insurance contracts. This does not require a certification in Iowa, and will be specifically advertised for once the laptop, portable printer, digital camera, and software have been purchased. Pamphlets for home inspection services will be of interest to insurance and real estate companies. 2. Universal Accessibility Options. Two groups will be targeted within this segment: the senior/mobility impaired citizen themselves, as well as their caretakers. A pamphlet will be designed showing the many modifications available to increase the independence offered to senior and mobility impaired citizens, in a larger, easy -to -read, format. We will introduce this material to physical therapists, the senior center, and medical supply companies. In targeting the aging and mobility impaired population, reaching their support network will be advantageous as family and friends often provide a large portion of their care, and would be looking to make the adaptations to their loved -ones homes. We will look to make contact with support groups for families, provide this brochure to the senior center as well, and address the elder care services companies in the Iowa City area. 3. Energy Efficiency. As awareness heightens of this critical issue Atlas Home Service will increase its offerings and advertisements. The tri-fold ad will include possible cost- effective home renovations, listings of information in regards to rebates from energy 18� companies, a check -list of home efficiency issues to evaluate when purchasing new property, and statistics regarding how energy efficiency measures can affect energy bills. This brochure will be of special interest to real estate companies as well. We will introduce this advertising method in April 2009 to prepare for the employees that will be hired in this timeframe. We will purchase stands to make it easy for the local businesses to display our brochures, and have them professionally designed and printed. $400.00 has been approximated for the purchase of 100 flyers of each style and the stands. Public Relations Professional Organizations The names of professional organizations instill credibility and confidence in consumers. Trust levels must be high to have someone work inside one's home, independently especially. Atlas Home Service will become a member of both the Better Business Bureau and Chamber of Commerce. $600.00 per year has been allotted in financial projections for professional organization memberships, divided into $50.00 per month. Charitable Causes and Service Organizations Atlas Home Service will continue to build upon its reputation of professionalism, dependability, and community involvement, through philanthropic means. Twice a year, we will donate a gift of a'/2 day handyman services coupon to a charity auction. The labor will be valued at $180.00, plus an additional $35.00 has been approximated to allow for a visually appealing and creative presentation. $430.00 per year/$36.00 per month have been included in financial projections. Hours will be contributed to Habitat for Humanity projects beginning Spring 2009. This will not take away from income projections, as John and Leah will volunteer outside of work hours. Service organizations will be further evaluated for membership as Atlas Home Service grows. Events Atlas Home Service will research the possibility of hosting an event at the Iowa City Senior Center in the winter of 2008-2009. This non-profit event will be aimed at educating seniors and their families that help care for them about home safety and accessibility options. We would offer refreshments, and provide visuals to show how minor renovations can help seniors lead more independent lifestyles. We will contact the director of the senior center, Linda Kopping, to set an appointment first. During this appointment we will conduct a brief interview, learning about the needs of the aging community and ways in which we may serve them. We will leave Linda with pamphlets and coupons in exchange for her time. 19I?, _ With the information we gather from this interview, we will put together a proposition to present regarding an event. If the research indicates this to be a functional plan, we will hold the event before March 31 st, 2009. The costs would only involve refreshments, and printed materials. As this would be a non-profit event, publicizing would not need to be an additional expense. Prospect Conversion Estimates are completed at no cost to existing clients as well as prospective clients. This can be a time-consuming process that doesn't always result in revenue. We will increase the conversion rate of estimates to invoices by placing timely follow-up calls to existing and prospective clients, which will provide them with the opportunity to ask questions and will exhibit our commitment to our clients. Client Retention Many of our clients have contacted us for repeat business; out of 106 clients, 72 have resulted in more than one job, a 68% conversion. In the past we have offered a 15% discount for new clients. Our experience over the past two years has proven that developing further work from existing clients is often more beneficial, and that these constructive and loyal consumers regularly bring in more productive business. We will begin utilizing the following techniques to further drive client retention. ■ Magnetic business cards, making it easier for existing clients to locate our contact information when they are in need of service, magnetic business cards will cost $200 for 1,000 count. ■ Offering incentives for their next project by presenting coupons with invoices. The coupons will vary to keep clients' attention ■ Continually soliciting contracts for on -going work, such as snow removal service. ■ Client satisfaction surveys will be developed. Each new client will be contacted after the completion of his or her first job and a very brief survey will be conducted to insure that the client is satisfied and to look for ways to continually improve the client care that Atlas Home Service provides. Client Referrals In a service industry that is dependent upon local clients, the importance of referrals can never be under -estimated. In this industry consumers will often ask someone they trust for a recommendation, and stay with that provider unless they have a reason for change. By providing our existing clients with the highest level of service, we will ensure that they will recommend us to their friends. We will begin a referral program, offering clients $10.00 cash for any referral that results in a job. $20.00 per month has been added to our marketing budget to absorb this ongoing promotional expense. Other possibilities for future consideration 20` It is anticipated that the above listed advertising and public relations marketing techniques will bring adequate workflow to support all employees available hours and meet the projected revenue requirements; however, should workload be an issue, we will consider Newspaper and circular ads, coupon booklets, and advertising in school publications to build upon the concept of community. Marketing Results The experience from the inception of Atlas Home Service to date indicates that minimal work hours, materials and finances will be needed to fund existing and newly developed advertising campaigns. We have advertised exceptionally little up until this point, yet we find that Atlas Home Service's schedule is consistently booked with requested jobs from new and returning clients. We anticipate that the advertising and public relations agenda that have been established will produce an ample client base and revenue to support our financial projections The tracking of our marketing successes and challenges will be crucial. In the past two years we did not have sales tracking measures in place, and therefore did not complete as much work as should have been done to build revenue. The lack of sales tracking measures also inhibited us from aptly analyzing the exact effectiveness of what marketing was done. QuickBooks for Contractors has many build -in features that will be implemented for tracking purposes. Leah will take courses to learn to best utilize these offerings within the next six months. New client forms have been created that will provide a reminder and location for all employees to note the source of the new client (see enclosure). This information will be imputed into the QuickBooks program under 'class', and allow us to print reports detailing the origin of our new clients. Every month after reconciling financial statements, John and Leah will review reports from the QuickBooks program; profit & Loss statements, income by item, and client analysis. This monthly review session will allow us to evaluate the successes and shortcomings of our current marketing layout. Ongoing market research will play a key role in the success of our marketing plan. We will view marketing as a cyclical process: plan, act, evaluate, and begin again. Through constant awareness we will make certain that we are on target with our goals and adjust as necessary to attain them. 21 , . Section IV: Documentation 1. New Client Letter 2. New Client Form 3. Job Ticket Form 4. John Lee Resume 5. Leah Lee Resume 6. Employee Rules & Regulations 7. Personal Budget 8. Loan Amount Calculations 9. Balance Sheets- QuickBooks Generated 10. Balance Sheet- Personal and QuickBooks Compilation 11. Profit & Loss Sheets 12. Financial Projections 22� �.t .. ATLAS HOME SERVICE Taking the weight of maintenance & repair off your shoulders! Client Smith 123 Anywhere Street Iowa City, IA 52245 October 251h, 2008 Dear Mr. Smith, Thank you for your recent interest in Atlas Home Service! Attached you will find the estimates you requested. Atlas Home Service is a locally owned and operated business, specializing in home & building repair, maintenance, and upgrades. Our business aims to stand above the rest. To our clients we offer the following benefits: • Free & accurate estimates • Appointments available days, nights, and weekends • Personal and friendly staff • Professional communications • Acceptance of MasterCard and Visa Again we want to thank you for your interest in Atlas Home Service. Please call us anytime. Office: 319.338.1744 Mobile: 319.400.6359 We look forward to serving you! Sincerely, John F. Lee Owner Office: 319.338.1744 • Emergency: 319.430.3959 • Email: john@atiashomeservice.com Mailing Address: PO Box 5033 • Coralville, IA 52241 ATLAS HOME SERVICE Taking the weight of maintenance & repair off your shoulders! Date: Name: Address: Stre e t City Zip -- Phone Number: Email Address: Estimate/Service Order Details job site Information: If different from client info Referred by: Phonebook Website Flyers- Distributed Poster on bulletin board Existing Client _ Other Office: 319.338.1744 • Emergency: 319.400.6359 • Email: john@atiashomeservice.com Mailing Address: PO Box 5033 • Coralville, IA 52241 ATLAS HOME SERVICE Taking the weight of maintenance & repair off your shoulders! JOB TICKET Date: Time in: Time out: Date: Time in: Time out: Date: Time in: Time out: Job Completed date/time: Work Done: Materials Purchased: Shop Materials Used: Office: 319.338.1744 • Emergency: 319.400.6359 • Email: John@atlashomeservice.com Mailing Address: PO Box 5033 • Coralville, IA 52241 PO Box 5033 • Coralville, IA 52241 • Phone: 319.338.1744 • Email: john@atlashomeservice.com John F. Lee Objective: To build Atlas Home Service into maintenance and repair company offering clients quick turn- around time and a diverse skill set through the use of employees, as well as the consistent professional service they require. Experience Proven ability to maintain and repair buildings and equipment including evaluation of client needs, trouble- shooting, and ongoing client support. Skilled in various trades and services, including: • Plumbing • Drywall • Universal Accessibility • Carpentry • Electrical & Lighting • Windows, doors, and • Decks & Fences • Lawn & Grounds siding • Painting Employment • Winter Servings October 2006 - Present Atlas Home Service Owner Coralville, IA • Primary Service Provider: All above listed skills. • Client Interactions: The ability to accurately capture the clients' desires and follow-through with their requests. • Daily operations: Scheduling, estimates, invoices. April 2006 - February 2007 Lincoln Real Estate Maintenance Professional Iowa City, IA • Provided ongoing property maintenance for 350 properties. • Completed work including remodels, rekeying of locks, snow removal, plumbing, electrical services, drywall, painting. • Daily reports and computer maintenance. June 2004 - April 2006 Distribution Clerk Buckledown Publishing Iowa City, IA Building maintenance including plumbing, electrical, snow removal, lawn care, and landscaping. • Receiving product and coordinating logistics of warehouse for most efficient operations. • Working on a daily basis with UPS Worldship 8.0 and Inventory Management systems. April 1997 - Present Northside Book Market Iowa City, IA Maintenance/Repair Contractor Ongoing, as needed employment, for a variety of maintenance & repair -oriented duties; responding to emergency situations, plumbing restoration and replacement, electrical repair, rehabilitation after water damage, snow removal, and landscaping. Pinpointing problem areas and proposing schedule for repair and replacement. Assisted with new business set-up prior to store opening. Tasks included basic remodeling and carpentry, painting, and drywall repair. January 2002 - May 2004 Access Direct Insurance Agent Coralville, IA • Managed incoming telephone calls to explain the details and benefits of life insurance to potential customers. • Assisted customers in completing applications for the product that best suited their needs. • Consistently surpassed all productivity and quality goals. PO Box 5033 • Coralville, IA 52241 •319.430.3959 • leah@atlashomeservice.com Leah j. Lee Objective To further develop my profession with Atlas Home Service allowing for growth to a full-time capacity. Experience Oct. 2006- Present Atlas Home Service Coralville, IA Marketing & Administration ■ Financial data entry and statement reconciliation, accounts payable and receivable. ■ Development of marketing materials. ■ Daily task and time management. April 2005 — Present Sweets and Treats Coralville, IA Office and Sales Manager ■ Customer Relations: Sales calls to local customers, represent company at trade shows, oversee and assist with follow-up on leads. • Marketing: Development of marketing tools including catalogs and website, ad campaigns, marketing analysis, trade show booth design and preparation. ■ Administrative: Preparation of internal human relations documents, coordination of operations with warehouse and office staff, creation of business documents and forms, updates and maintenance of inventory items in Peachtree Accounting Program. February 2002 — April 2005 MCI Iowa City, IA Customer Service Representative ■ Analyzed computer errors to categorize and forward for resolution ■ Handled outbound and inbound calls to resolve customers' account issues. ■ Completed data entry assignments consistently surpassing all productivity goals. January 2000 — January 2002 FutureCall LLC Colorado Springs, CO Floor Supervisor • Provided on -going training and support to sales representatives; development of sales skills, implementing motivational programs, and one-on-one coaching sessions. ■ Ensured quality and adherence to all applicable guidelines and policies. ■ Administrative duties including reports and communication with upper -level management. Education Kirkwood Community College Iowa City, IA ■ Majored in communications and education. ■ Maintained a 4.0 GPA. Skills ■ Typing 60+ Words per minute. ■ Proficient with 10-key data entry. ■ Experienced with various software, including Microsoft Word, Excel, Outlook, Peachtree Accounting, and QuickBooks for Contractors. ■ Excellent communication and organization skills. Atlas Home Service Employee Rules and Regulations Probationary Period Every new employee is on a four week probationary period. Pay Periods Pay periods run from the 1 st to the 15th of the month, and the 16th until the last day of the month. Payroll Paychecks will be available on the lgt and 15th. The paycheck received will be for the pay cycle completed a half month prior. Time Cards Time cards must be filled in with each shift daily upon arriving and leaving. If not recorded, hours will not be compensated. Hours worked outside of scheduled shift must be discussed with management. Schedules ■ The routine work day will take place from 8am to 5pm. ■ Employees are entitled to a one -hour unpaid lunch daily. Personnel may not travel farther than three miles from where they are working during lunch hour in a company vehicle. ■ All employees will be required to be on -call 24/7 for snow removal from October through April. ■ A rotating on -call schedule will be determined. ■ Other projects may necessitate work outside of the routine schedule. ■ Overtime will be paid out at time and a half wages, beyond 40 hours worked within a week. Paid sick or vacation time does not contribute towards overtime hours. Overtime must be approved in advance by management. ■ Any schedule conflicts will need to be approved by management at least one month in advance. Sick Call/Late Call Employee must report any illness or tardiness to management as soon as possible. More than two incidents of tardiness in one month may be considered grounds for termination. More than one no -call -no-show occurrence in a year may be considered grounds for termination. Accidents All accidents must be reported immediately. An accident report must be filed. Professional Behavior At all times you are expected to conduct yourself in a professional manner while representing Atlas Home Service. You are expected to greet each client and offer assistance to them. You are to be polite and courteous at all times. Personal conversation at the job site will not be tolerated. There are to be no personal phone calls made or received while at work. Leaving a job site without proper authorization by management is unacceptable. Clients When leaving Atlas Home Service employees may not contact or do any work for our clients. All cash bonus' or gifts from clients are to be reported to the office. Anything broken must be immediately reported to management. Dress Code The appearance of employees reflects upon the individual as well as the overall image of Atlas Home Service. Our business is professional, and we require our employees to project this image. ■ Company shirts are to be worn at all times when on duty. ■ Pants must be in reasonably good condition. We understand that due to the nature of the work, stains will occur, however no torn clothing is to be worn. Denim and khaki material are both acceptable. No exercise or lounge -wear. ■ Shorts must be no shorter than two inches above the knee. ■ If you like to wear hats when working, please request an Atlas Home Service hat. ■ No logos other than Atlas Home Service logo will be displayed when on duty. ■ Shoes should be sturdy and appropriate for work. No open toe shoes or sandals will be allowed. Tennis shoes should be clean with laces. Socks must be worn. ■ No excessive jewelry may be worn. Up to two earrings per ear, no facial piercings. Exceptions may be made by management. Smoking/Drugs There is to be no smoking during work time. Smoking is allowed on your breaks, however not on the property or in eye sight of any Atlas Home Service clients. The use of drugs and alcohol of any kind is prohibited while at work. Coming to work under the influence of drugs or alcohol is grounds for dismissal. Common Reasons for Dismissal Repeated complaints from customers, continued absence from work, continued absence of protective wear for maintenance personnel when necessary, inadequate notification when ill, discussing wages and other confidential matters, stealing, inaccurate job tickets, insubordinate attitude, malicious gossip, soliciting of Atlas Home Service clients, coming to work under the influence of drugs or alcohol, dating other employees of the company, tardiness, unsatisfactory job performance. Sick Time The first year of employment all sick time will be taken unpaid. Six paid days per year will be given after the first year. Vacation All employees after one full year of service will receive 40 hours paid vacation. After two full years of service all employees will receive 80 hours paid vacation, and 120 hours after five years. All vacation must be taken within the year in which it was earned. Holidays The following are considered company holidays: ■ New Year's Eve • New Year's Day ■ Memorial Day ■ July 4ch ■ Labor Day ■ Thanksgiving ■ Day after Thanksgiving ■ Christmas Eve ■ Christmas The first year holidays are unpaid. After one year of service with the company holidays will be paid for by Atlas Home Service. Continuing Education After two years of continuous employment with the company, employees will have the opportunity to take up to three continuing education courses per year towards plumbing and electrical certifications. Personal Budget INCOME Atlas -John Atlas- Leah Rental Income: 425 Peterson Street $900.00 Sweets and Treats- Leah's income until April $1,950.00 BILLS Electricity & Gas $225.00 Water $75.00 Dish Network $80.00 Childcare Kids' Health Insurance $1,200.00 $160.00 Insurances: Homeowners, renters, personal articles, disability, personal vehicle. $160.00 Life Insurance $60.00 Volvo Loan Payment $295.00 Von Maur Credit Card Payment $100.00 UICCU Credit Card Payment $250.00 1402 Esther property taxes $185.00 1402 Esther first mortgage $820.00 1402 Esther second mortgage $150.00 425 Peterson property taxes $135.00 425 Peterson first mortgage $515.00 425 Peterson second mortgage $75.00 425 Peterson Association Dues $125.00 BILL TOTAL $4,610.00 EXPENSES Groceries $550.00 Dining out/Convenience Stores $100.00 Household Supplies $50.00 Personal Care $100.00 Medical $100.00 Fuel- Volvo $200.00 Auto Upkeep $50.00 Clothing $50.00 Pets $60.00 Gifts and Holidays $100.00 Entertainment $100.00 Health & Fitness $50.00 Other $100.00 EXPENSE TOTAL $1,610.00 MINIMUM NET INCOME NEEDED PER MONTH $6,220.00 Loan Amount Calculations One -Time Expenses Vehicle Expense for April $3,300.00 Signs for Truck $300.00 Uniforms $550.00 Technologies $4,000.00 Office $200.00 Small Tools/Stocked Materials $600.00 Professional Services $1,500.00 Marketing $1,200.00 One-time Expense Total $11,660.00 Ongoing Monthly Expenses Office Supplies $50.00 Shop Materials & Small Tools $100.00 Truck Fuel & Upkeep $650.00 Telephones & Internet $126.00 Marketing $375.00 Professional Services $180.00 Continuing Education $75.00 Insurance $1,835.00 Bank Charges $30.00 Loan Payment $944.31 Misc. $150.00 Salaries $13,357.83 Truck Payment $300.00 Shop Rental $550.00 Shop Utilities $100.00 Monthly Expense Total $18, 823.14 Multiplied by Three months = $66,469.42 Start-up + Monthly = $68,119.42 REQUESTED LOAN AMOUNT $68,250.00 ***Note: Monthly expense amounts based on May 2009*** 2:12 PM Atlas Home Service 12/04/08 Balance Sheet Accrual Basis As of December 31, 2006 Dec 31, 06 ASSETS Current Assets Checking/Savings Cash -4.16 Checking 58.88 Total Checking/Savings 54.72 Total Current Assets 54.72 Fixed Assets Ford Explorer 1,500.00 Large tools/equipment 208.95 Total Fixed Assets 1,708.95 TOTAL ASSETS 1,763.67 LIABILITIES & EQUITY Liabilities Current Liabilities Accounts Payable Accounts Payable -50.00 Total Accounts Payable -50.00 Credit Cards HSBC Gold Mastercard 8408 1,337.79 Total Credit Cards 1,337.79 Other Current Liabilities Ford Explorer, Loan 5 1,271.98 Sales Tax Payable 89.25 Total Other Current Liabilities 1,361.23 Total Current Liabilities 2,649.02 Total Liabilities 2,649.02 Equity Auto Expenses (owner draw) -101.93 Owner draws -897.30 Owners Investments 731.20 Net Income -617.32 Total Equity -885.35 TOTAL LIABILITIES & EQUITY 1,763.67 Page 1 2:14 PM Atlas Home Service 12/04/08 Balance Sheet Accrual Basis As of December 31, 2007 Dec 31, 07 ASSETS Current Assets Checking/Savings Cash -132.92 Checking -190.14 Total Checking/Savings -323.06 Accounts Receivable Accounts Receivable 1,836.67 Total Accounts Receivable 1,836.67 Other Current Assets Undeposited Funds -0.76 Total Other Current Assets -0.76 Total Current Assets 1,512.85 Fixed Assets Large tools/equipment 355.78 Vehicles 4,000.00 Total Fixed Assets 4,355.78 TOTAL ASSETS 5,868.63 LIABILITIES & EQUITY Liabilities Current Liabilities Accounts Payable Accounts Payable -100.00 Total Accounts Payable -100.00 Credit Cards Household Bank 7534 500.53 HSBC Gold Mastercard 8408 49.85 Total Credit Cards 450.68 Other Current Liabilities Sales Tax Payable 101.71 Total Other Current Liabilities 101.71 Total Current Liabilities 452.39 Total Liabilities 452.39 Equity Auto Expenses (owner draw) -2,112.33 Owner draws -26,421.69 Owners Capital -617.32 Owners Investments 17,679.81 Net Income 16,887.77 Total Equity 5,416.24 TOTAL LIABILITIES & EQUITY 6,868.63 Page 1 2:16 PM Atlas Home Service 12/04/08 Balance Sheet Prev Year Comparison Accrual Basis As of October 23, 2008 Oct 23, 08 Oct 23, 07 $ Change % Change ASSETS Current Assets Checking/Savings Cash 0.00 -96.90 96.90 100.0% Checking 2,932.83 -950.35 3,883.18 408.6% Total Checking/Savings 2,932.83 -1,047.25 3,980.08 380.1% Accounts Receivable Accounts Receivable 2,896.34 2,637.44 258.90 9.8% Total Accounts Receivable 2,896.34 2,637.44 258.90 9.8% Other Current Assets Undeposited Funds 519.67 -557.60 1,077.27 193.2% Total Other Current Assets 519.67 -557.60 1,077.27 193.2% Total Current Assets 6,348.84 1,032.59 5,316.25 514.9% Fixed Assets Large tools/equipment 1,155.78 355.78 800.00 224.9% Vehicles 4,000.00 4,000.00 0.00 0.0% Total Fixed Assets 5,155.78 4,355.78 800.00 18.4% TOTAL ASSETS 11,504.62 5,388.37 6,116.25 113.5% LIABILITIES & EQUITY Liabilities Current Liabilities Accounts Payable Accounts Payable 69.99 -100.00 169.99 170.0% Total Accounts Payable 69.99 -100.00 169.99 170.0% Credit Cards Household Bank 7534 1,986.15 -241.46 2,227.61 922.6% HSBC Gold Mastercard 8408 1,916.86 1,274.08 642.78 50.5% Total Credit Cards 3,903.01 1,032.62 2,870.39 278.0% Other Current Liabilities Sales Tax Payable 290.56 291.71 -1.15 -0.4% Total Other Current Liabilities 290.56 291.71 -1.15 -0.4% Total Current Liabilities 4,263.56 1,224.33 3,039.23 248.2% Total Liabilities 4,263.56 1,224.33 3,039.23 248.2% Equity Auto Expenses (owner draw) -2,536.67 -2,050.95 -48&72 -23.7% Owner draws -19,520.84 -21,166.14 1,645.30 7.8% Owners Capital 8,286.80 -617.32 8,904.12 1,442.4% Owners Investments 0.00 14,754.81 -14,754.81 -100.0% Net Income 21,011.77 13,243.64 7,768.13 58.7% Total Equity 7,241.06 4,164.04 3,077.02 73.9% TOTAL LIABILITIES & EQUITY 11,604.62 6,388.37 6,116.26 113.5% Page 1 2:16 PM Atlas Home Service 12/04/08 Profit & Loss Accrual Basis October through December 2006 Oct - Dec 06 Ordinary Income/Expense Income Intrest Income 0.06 Job Income 1,804.93 Refunds & Discounts -74.07 Total Income 1,730.92 Cost of Goods Sold Job Materials Purchased 185.03 Total COGS 185.03 Gross Profit 1,545.89 Expense Advertising costs 352.45 Bank Service Charges 64.31 Client appreciation 57.91 Computer 423.98 Continuing Education 95.00 Facilities 16.29 Insurance Expense 268.80 Materials- small misc. 181.20 Miscellaneous Expense 91.00 Office Supplies 224.53 Printing & checks 89.29 Telephone & Internet 226.58 Tools and Small Equipment 33.74 Uniforms 17.29 Total Expense 2,142.37 Net Ordinary Income-596.48 Net Income-596.48 Page 1 2:17 PM Atlas Home Service 12/04/08 Profit & Loss Accrual Basis January through December 2007 Ordinary Income/Expense Income Intrest Income Job Income Refunds & Discounts Total Income Cost of Goods Sold Cost of Goods Sold Disposal Costs Equipment Rental for Jobs Job Materials Purchased Other Job Related Costs Total COGS Gross Profit Expense Advertising costs Bank Service Charges Client appreciation Computer Insurance Expense Interest Expense Materials- small misc. Miscellaneous Expense Office Supplies Postage Tax Prep. Telephone & Internet Tools and Small Equipment Uniforms 66900 - Reconciliation Discrepancies Total Expense Net Ordinary Income Other Income/Expense Other Income Misc. Income Total Other Income Net Other Income Net Income Jan - Dec 07 0.09 36, 350.04 -1,465.04 34, 885.09 -36.23 117.07 380.16 8,069.48 45.00 8,575.48 26, 309.61 692.37 268.67 28.80 747.21 1,196.35 75.07 672.38 57.09 776.42 64.80 398.50 1,931.11 2,423.34 106.77 -0.40 9,438.48 16,871.13 16.64 • 16.64 16.64 16,887.77 Page 1 2:19 PM Atlas Home Service 12/04/08 Profit & Loss Prev Year Comparison Accrual Basis January 1 through October 26, 2008 1.... A Aga n� nn •__ . w �� �- - __ Ordinary Income/Expense Income Intrest Income Job Income Refunds & Discounts Total Income Cost of Goods Sold Cost of Goods Sold Disposal Costs Equipment Rental for Jobs Job Materials Purchased Other Job Related Costs Total COGS Gross Profit Expense Advertising costs Bank Service Charges Client appreciation Computer Insurance Expense Interest Expense Materials- small mist. Miscellaneous Expense Office Supplies Postage Tax Prep. Telephone & Internet Tools and Small Equipment Uniforms 66900 • Reconciliation Discrepancies Total Expense Net Ordinary Income Other Income/Expense Other Income Misc. Income Total Other Income Net Other Income Net Income 305.11 0.09 305.02 338,911.1% 32,723.75 31,306.60 1,417.15 4.5% O IOw nn a - 1.-- J 1 Y.VL .7.1 /0 0.00 -36.23 36.23 100.0% 136.78 117.07 19.71 16.8% 143.16 380.16 -237.00 -62.3% 2,120.25 8,069.48 -5,949.23 -73.7% -27.00 45.00 -72.00 -160.0% 2,373.19 8,575.48 -6,202.29 -72.3% 28, 531.58 21,414.67 7,116.91 33.2% 652.12 572.88 79.24 13.8% 237.30 148.44 88.86 59.9% 92.74 28.80 63.94 222.0% 0.00 747.21 -747.21 -100.0% 796.83 988.00 -191.17 -19.4% 392.36 75.07 317.29 422.7% 2,043.60 646.98 1,396.62 215.9% 9.53 57.09 -47.56 -83.3% 163.06 776.42 -613.36 -79.0% 95.51 64.80 30.71 47.4% 390.00 398.50 -8.50 -2.1 % 2,212.36 1,931.11 281.25 14.6% 261.20 1,645.33 -1, 384.13 -84.1 % 0.00 106.77 -106.77 -100.0% 0.00 -0.40 0.40 100.0% 7,346.61 8,187.00 -840.39 -10.3% 21,184.97 13,227.67 7,957.30 60.2% 0.00 15.97 -15.97 -100.0% 0.00 15.97 -15.97 -100.0% 0.00 15.97 -15.97 -100.0% 21,184.97 13,243.64 7,941.33 60.0% Page 1 C"z ctnco0cn tnrnmmmmmrc- cn ymmmmmr-c-- f)ID�CD222= o3�3;c O soc33333�DO� 033333�DO n XX n o '� 0 0 0 0 0 �D 0> O v 3= n O N N c 'Tl N 3 -I O O O O W -0 C(n N 0� C N N N N N N CD CD o Fj. x (D CDD CND CND N N N S N M 3 m O Cn A W N -� 3 0 CD i+ f011 M (D � � o CD N c Q ,Or Er O x M � O — � O N O n CD 40 W �A O W- O O O .696969 N Ul N N �. 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Cn00(n 0 M 0 0000 . . . . 000 . . . N CO 00 0000 000 �. Q) 00 000) 0000 000 0000 000 O n a) O (D C) O O L C N O A CD N 3 CS CD N 0 �Y r CITY OF IOWA CITY Ott E M 0 RAN D U M M To: Economic Development Committee From: Jeff Davidson, Planning Director Date: December 11, 2008 Re: Englert Theater's Request for funding Background In November, Brenda Pearson, President of the Board of Directors of the Englert Theater, submitted a written request for on -going funding for the Englert from the City of Iowa City. The Council referred the request to the City Council Economic Development Committee. Following this memo is her revised request for an annual $50,000 appropriation and information to support the request. The City Council Economic Development Committee's review of this request seems appropriate as the Englert Theater plays a significant role in the Economic Development efforts of the city and generates a substantial economic impact centered in downtown Iowa City. Englert as a business As a non-profit cultural organization, the Englert employs 5 full time employees and up to 25 part time employees. They provide a benefits package to their employees that includes health insurance, retirement benefits and a modest incentive bonus when the budget allows. The Englert also benefits from the volunteer work donated by 100 active volunteers and 25 board members. The Englert has built relationships with a number of local businesses who also support the theater. With the need for and the ability to secure support from businesses such as Zephyr Printing ($10,000 of printing), Sheraton Hotel ($5,000 in hotel rooms), and Mediacom ($10,000 in advertising), the Englert continues to prove its value to the local business community. Since the Englert opened, approximately 59% of tickets for ticketed events (some are free) have been sold to people with zip codes within Johnson County while 41 % have been from outside of Johnson County. This is a good indicator that the Englert is serving the local cultural scene and is strong enough to draw an audience from outside of the county. Englert as a Community Partner Restaurant and food businesses have discovered that partnering with the Englert is good business. Some of the downtown restaurant businesses have offered "dinner theater' discounts where ticket holders are eligible for discounts and others have donated in -kind to support ancillary and fund-raising events. As with most community businesses, the Englert is asked to do its share of donating, too. Annually, they donate between $4,500 and $5,000 in tickets for the fundraisers and silent auctions for their colleagues at other local non-profit organizations. December 12, 2008 Page 2 The Englert also provides rental subsidies for local non-profit organizations. In 2007, the theater billed $57,968 to local non -profits for rentals, which, for other organizations would have paid $129,800 at full price, essentially giving the non-profit renters an average 55% discount to rent the theater. The Englert also donates 780 square feet of gallery space free of charge to area artists and does not charge commission when works are sold at the gallery. Englert as a Quality of Life factor Many of the area's largest employers use downtown Iowa City as a "must -see" in their efforts to recruit new talent to their companies. To drive along Washington Street and see the Englert marquee heralding three events in 10 days is a typical sight and one that assures potential recruits that there is a lot going on in Iowa City. The marquee serves as a billboard for visitors and locals, reminding them that there is always something happening in downtown Iowa City. The Englert's programming is as diverse as the community it serves. They offer everything from the free US and the World semester -long educational series to the popular holiday classic, The Nutcracker. There is a wide variety of artists and programs throughout the year. Englert as a Historic Landmark The Englert Theater has been a treasured institution since it was first built in 1912 on the site of a former livery stable. When it burned to the ground in 1926, sentiments about it were already strong, owing to the complete rebuilding of the theater as we know today. The theater will celebrate a centennial in 2012. The Englert is a valuable and tangible link to Iowa City's past. Staff Recommendation 1. Support the Englert's request and forward a recommendation to the full City Council to fund the request through the Economic Development Division budget. 2. Structure an agreement that provides $50,000 a year for three years, renewable each year upon an annual accountability report in November. 3. Among the measures to account for each year of an ongoing agreement, staff recommends: • Balance Sheets, Income Statements and Cash Flow Statements • Report on the diversity of programming • Report on the assistance to non-profit organizations • Report on partnerships with downtown and other businesses • Tickets sold reported by zip code • Parking tickets redeemed at City parking garages by ticket holders tn Let's discuss this recommendation at the meeting on the 16 CALL 319.688.2653 CLICK www.englert.org VISIT 221 E Washington St., Iowa City, IA 52240 CONNECT Blogger / Facebook / MySpace / Twitter December 10, 2008 To the Economic Development Committee: Thank you for considering our request that the City of Iowa City provide $50,000 in annual funding to support the Englert. This letter restates the information presented in our original request in November. We believe that The Englert Theatre is an integral part of Iowa City's cultural landscape and a proven driving force for economic development in the City and the entire Corridor. Funds from the City will be used to develop quality arts programming, provide the community with an affordable performance space and preserve Iowa City's historic landmark. Nearly 10 years after its doors closed as a deteriorating movie theater, the Englert stands today as a true non-profit success story in the heart of downtown Iowa City. The Englert has welcomed more than 100,000 people through its doors since re -opening in December 2004 after a massive renovation and a $5.3 million grassroots fundraising effort. The Englert Theatre presents diverse programming and is used consistently by a wide range of organizations, providing a valuable service to the community. The Englert is used more than 150 days each year, presenting a wide variety of local and nationally - known live music (Randy Newman, Robert Cray, Lucinda Williams, Mike & Amy Finders), comedy (The Second City, Capitol Steps), theater (Oliver, Gypsy, Fiddler on the Roof, Seussical), dance (The Nutcracker), movies (Rocky Horror Picture Show), readings (Sarah Vowell, Chuck Klosterman) and community events (free US and the World lecture series, Human Rights Youth Awards, Landlocked Film Festival). Collaborations with Iowa City Community Theatre, Young Footliters, City Circle Acting Company, Nolte Academy of Dance, The Iowa Children's Museum, The University of Iowa Division of Performing Arts, United Action For Youth and many others have given each of these organizations an opportunity to expand their reach in the community. In addition to ticketed events, the Englert offers several free events each year, including the five Community Spotlight Series performances that highlight diverse local talent from bluegrass musicians to modern dancers. School buses line Washington Street several times a year, dropping off hundreds of children for discounted matinee performances. Our space has also been used for weddings, memorial services, film & television shoots, company meetings, religious services and special receptions. In addition, the art gallery on our second floor showcases the work of local artists and serves as a meeting space for community groups. The Englert is a financially responsible non-profit that continues to grow. Over the past three years, The Englert Theatre has focused on maximizing use of the building by increasing the amount of programming we offer. The number of events -- both self -produced and rentals by other organizations -- has increased more than 54%, from 104 in 2006 to more than 160 this year. Through November, we are exceeding 2008 budgeted programming/rental revenue by 3 3 % while keeping gross margins and overhead costs steady. Like all non-profit theaters, earned income covers only a portion of what it costs the Englert to produce quality programming, offer subsidized rental rates of up to 75% to community groups, pay a professional staff and maintain the national historic landmark. In 2007 alone, we provided discounts in excess of $70,000 to these community groups. Our Friends of the Englert annual fundraising campaign has grown impressively, having been launched fewer than three years ago. So far this year, over 550 donors have contributed more than $71,000. Businesses such as Toyota -Scion of Iowa City, University of Iowa Healthcare and Target have invested thousands of dollars in event sponsorships. The Englert received a prestigious Cultural Leadership Partner grant from the State of Iowa, promising $16,000 in annual funding, and also earned support from the Community Foundation of Johnson County. Over the next three years, we expect that earned income will generate approximately 68% of our $800,000 budget. This calculation is based on modest programming growth and a projected decrease in rental revenues after the opening of the Coralville Performing Arts Center. Continued development efforts via Friends of the Englert, new fundraising events, grants and sponsorships are expected to contribute 25%. Despite solid financial performance, the Englert is missing a critical piece needed to ensure continued high levels of diverse programming and community service: annual financial support from the City. Annual financial support from the City can close the gap in our operating budget and help us achieve our goal of break-even operations in 2011 and beyond. The City stands to benefit by making this investment. When considering the cultural and economic impact of The Englert Theatre, investing in the Englert is simply good business. National and regional studies have demonstrated that the arts are as critical to economic development as roads and utilities infrastructure. Economists such as Richard Florida have garnered international acclaim for their views on the "creative economy theory": the notion that jobs and workers will flock to those cities that have a vibrant cultural environment. As cities compete for talented workers and new business endeavors, those with a high level of cultural opportunities have a distinct advantage. The Englert draws an average of 30,000 people each year. When the marquee lights are lit, people flock downtown to patronize neighboring businesses. Restaurants like One Twenty Six and Devotay credit the Englert with filling tables that would otherwise sit empty. Theater patrons and performers line up at coffee shops like Java House and Capanna. Travelers from out of town book hotel rooms at the Sheraton and hotelVetro and shop at Iowa Artisans Gallery and Prairie Lights. The indirect spending that flows from all of these patrons is significant, according to the League of Historic American Theatres. Using a conservative estimate of $20 per patron in spending related to their theater visit beyond ticket price (dining, parking, shopping, gas, babysitting, hotel, etc.), the economic impact of The Englert Theatre is at least $600,000 annually. The Englert increases its economic impact by employing five full-time and up to 30 part-time employees, paying sales tax and property tax for our third floor offices, and purchasing supplies from local businesses whenever possible as part of the Chamber of Commerce's "Buy Here" initiative. We are also taking a leadership role in supporting City efforts to provide late night non-alcoholic alternatives downtown. This fall, the Englert partnered with the University of Iowa Division of Performing Arts to launch a new midnight alcohol -free series of events: Alley Cabaret. On select Fridays and Saturdays, audience members enter through the back alley and sit onstage with the performers, enjoying everything from live music to one -act plays. This innovative program will be expanded in 2009. Iowa City will join other municipalities providing financial support for their local theater. The Orpheum Theatre in Galesburg, IL, receives up to $100,000 a year through an allocation of 2% of a 7% hotel/motel tax. The City of Knoxville, TN, supplies $48,000 of annual operating support to the Tennessee Theatre. In other instances, cities pay for utility costs or provide sales and property tax rebates. Our neighbor city of Coralville will invest millions of dollars to build and then operate their own theater. Iowa City already has a strong track record of supporting the arts and downtown development, providing annual assistance to Summer of the Arts, upgrading the pedestrian mall and partnering on an enhancement to the walkway next to the Sheraton hotel. The City also played a key role in the Englert's early stages by purchasing the building and holding it in trust until funds could be raised to purchase it. We recognize that this is a difficult time for Iowa City as we rebuild from the devastating summer floods. In crisis situations it can be difficult to look past the immediate source of pain. However, in times like these it is more important than ever to invest in areas that will ensure a vibrant community for years to come. Iowa City has a reputation as the cultural center of Iowa. It has earned "best place to live" honors in national magazines such as Forbes and Money. The Englert Theatre is an important part of that. With City support, the Englert can continue its positive impact on Iowa City's culture and economy. Without that support, the future of the Englert is less certain. When the community came together to save the Englert a few short years ago we did so with the vision that it would forever be at the center of our downtown, an historic home for the arts in Iowa City. Please help us continue that vision by providing $50,000 of annual support. We welcome the opportunity to work with you to develop accountability measures for this support, to ensure that your expectations are being met. Please take a moment to review the enclosed supporting documents, including statements of support from community leaders. Sincerely, Brenda Pearson President, Englert Board of Directors Excerpts from Letters of Support from Community Leaders (Complete letters attached at the back of this packet) "The Englert Theatre is so much more than a tourist attraction. It's an absolutely integral part of our local quality of life ... Your annual investment will not only be directly returned by future direct spending, but indirectly continue to make this place, Iowa City, unique." - Joshua Schamberger, President, Iowa City/Coralville Convention & Visitors Bureau "As an historical venue, the Englert provides an authentic experience with the amalgam of offerings important to the creative workers for which our community competes. Economic development funding in support of the Englert is a sound investment in our community." - Nancy Quellhorst, President & CEO, Iowa City Area Chamber of Commerce "MidWestOne is proud to be the Englert's longtime financial partner. I urge the City to follow our example and the example of other municipalities around the country — and even in Johnson County — who value the impact of a theatrical venue such as the Englert enough to take a leadership role in securing its future." - W.R. Summerwill, Chairman, MidWestOne Bank "I have seen firsthand the impact that the Englert Theatre has had on retail establishments such as the Java House, Iowa Artisans Gallery and Chait Galleries downtown. I also know that the Englert is a big draw for Iowa City tourism. Events have brought people and dollars to our community from all over the Midwest." - Joe Jennison, Executive Director, Iowa Cultural Corridor Alliance "The Englert is a recognizable beacon of what our community is capable of and a large attractor for young professionals, families and retirees to the city. Our area is fortunate that we do not need to spend millions on creating a niche, we need only make small continued investments in preserving and protecting those entities which give so much back to our area." - Mark and Leslie Nolte, Owners, Nolte Academy of Dance "There is hardly a viable example to emulate when looking for a vital, interactive and thriving downtown business and cultural district in this State. It is for this reason that the need to continue focusing on projects such as the Englert ... that distinguishes us, not homogenizes us, is critical." - Mark Ginsberg, Owner, M. C. Ginsberg Objects of Art "(The Englert) contributes to our local economy; it brings in tens of thousands of dollars ... to our hotels, restaurants, and retail establishments. In short, the Englert Theatre is a driving force to our downtown's vitality." - Craig Gustaveson, President, Downtown Association "Non-profit theatres, especially in relatively small metropolitan areas like ours, have an extremely difficult time raising sufficient funds to operate. Those that do survive do so because of ongoing municipal support ... I hope you will offer support for such an outstanding organization." - Alan MacVey, Director, University of Iowa Division of Performing Arts "Things like the great entertainment at the Englert Theatre significantly add to the quality of life of our community. As one of the area's largest employers, we know how important those quality of life issues are to recruiting and attracting ... employees and their families to the area. Those same factors play a key role in helping keep people here long term." - Tom Walljasper, Interim Director Community Relations, University of Iowa Health Care "In a college town, it would be easy for downtown Iowa City to be completely dominated by the bar scene, but the Englert provides a refreshing center for the arts to bring families from Iowa City and beyond to the downtown area. The Englert is exactly the type of facility that is needed to keep Iowa City a well-rounded, family -friendly community and keep businesses like us thriving in the downtown area." - Mike McCain, Owner, Capanna Coffee and Gelato "(The Englert) brightens the night life and cultural scene in Iowa City, which otherwise is sadly monolithic. I know for a fact that it draws a lot of people downtown in the evenings who otherwise would be reluctant to venture out. As a restaurant owner, I also know first hand how the Englert impacts numerous businesses in the region, including One Twenty Six." - Mathew Chackalackal, Owner, One Twenty Six "The Englert Theatre is a vital part of the downtown district. The Sheraton Iowa City Hotel, Hotel Vetro and many other businesses benefit greatly as a result of the historic theater." - Matthew Traetow, Director of Sales & Marketing, Sheraton Iowa City Hotel Statement of Profit & Loss 2008 Year -to -Date (through November) Actual vs. Budgeted Income Jan -Nov Actual Jan -Nov Budget % -under/+over Fundraising/Grants $ 108,704 $ 220,160 -51% Englert Events $ 483,283 $ 364,730 33% Rental Events $ 150,142 $ 92,584 62% Other $ 32,254 $ 12,507 158% Total Income $ 774,383 $ 689,981 12% Expenses Administration $ 127,719 $ 175,894 -27% Building $ 95,064 $ 82,710 15% Personnel $ 277,449 $ 268,772 3% Englert Events $ 332,012 $ 217,109 53% Rental Events $ 2,444 $ 4,767 -49% Non -Operating $ 37,687 $ 39,135 4% Total Expenses $ 872,373 $ 788,387 11% Profit/(Loss) $ (97,990) $ (98,406) 0% Statement of Profit & Loss 2009-11 Budget Projections. Income 2009, 2010 2011 Earned Income Englert Events $ 450,000 $ 472,600 $ 496,126 Rental Events $ 85,000 $ 60,000 $ 60,000 Other Income $ 8,500 , $ 9 500 $ 10,500 Oontribtited Income Friends of the Englert $ 90,000 $ 100,000 $ 110,000 Fundraising Events $ 20.000 $ 30,000 $ 45,000 Sponsorships $ 40,000 $ 50,000 $ 50,000 Grants $ 21,000 $ 26,000 $ 33,000 City of Iowa City $ 60,000 $ 50,000 $ 50,000 'Total Income $ 764,500 798,000 $ 854,625 (� Expenses 75,IJ00 $ 75,000 Administration $ 76,000 $ Building Personnel $ 286,000 ; $ 297,440 Englert Events $ 308,790 $ 325,216 $ 342,461 Rental Events $ 3,500 $ 3,600 $ 3,600 Non -Operating $ 41,500 $ 42,500 $ 17,991 Total Expenses $ 803,790 $ 833,655 $ _ 838,290 Profit/(Loss) 35.6551 $ 16,335 * NOTE: Non -Operating Expenses include a $24,000 annual payment to our limited partner, as part of the process to receive federal and state tax credits to pay for renovation costs. The agreement with our limited partner dissolves in 2011. Community Organizations Who Have Used or Partnered With the Englert 10,000 Hours Show Agudas Achim Cedar Rapids Brass Chamber Ensemble City Circle Acting Company of Coralville Emma Goldman Clinic Family Concert Series Friends of Historic Preservation Friends of Old Time Music Hills Bank ICDOCs Documentary Film Festival Iowa Children's Museum Iowa City Area Chamber of Commerce Iowa City Community Band Iowa City Community String Orchestra Iowa City Community Theatre Iowa City Hospice Iowa City Human Rights Youth Awards Iowa City Rotary Iowa Cultural Corridor Alliance Johnson County Soil Conservation Board KCCK Landlocked Film Festival Liars Theatre New Horizons Band Nolte Academy of Dance Old Capitol Chorus Old Gold Singers Parkview Church Prairie Lights Preucil School of Music Regina High School Releve Dance Company Riff Raff Theater River Community Church School For Performing Arts SCOPE Summer of the Arts The Quire United Action for Youth University of Iowa Chamber Music University of Iowa College of Education University of Iowa College of Medicine University of Iowa Dental Hygiene Alumni University of Iowa Division of Performing Arts University of Iowa Lecture Committee University of Iowa Opera University of Iowa Orchestra University of Iowa School of Engineering US and the World Lecture Series Vets Helping Vets Wal-Mart West Music Women in Science and Engineering WSUI / KSUI Young Footliters Growth in Englert and Rental Events 2006-2008 50 43 57 ■ Englert ❑Rentals Englert Board of Directors 2008 Brenda Pearson, President brenda-p earsona,uiowa. edu Entrepreneur Paul D. Burns, VP/President-Elect pburns(c bradleyriley.com Bradley & Riley, PC Ron Neems, Co -Vice President msneems(a_mchsi.com Executive Vice President — American Bank and Trust Alan Swanson, Secretary al an-swansona,mchsi. com Broker / Associate Blank & McCune Real Estate Company Brad McNulty, Treasurer bmcnulty(ab,deloitte. com Senior Manager, Deloitte Tax LLP Bill Thomasson, Co -Treasurer Bill Thomasson(crbfrontiercoop.com Frontier Natural Products Co-op Barbara Buddin ICCT Representative barbybuddin6'0,Yahoo. com Free Lance Singer and Conductor John Chadima Vice President & Trust Officer, ISB&T Brenda Christner ICCT Representative b christneramchsi.com Wendy Ford Wender ford(a Iowa-city.or City of Iowa City Kurt Griebel Store Manager, Target kurt.griebelatar eg_t.com Colin Hennessy Associate Director of Annual Giving, UI Foundation colin hennessy0a,wmail.com Myrene Hoover hd-hoover(a mchsi.com Dr. Rick Hopson hopsonjr(i�aol.com Anna Moyers Stone Attorney, Phelan -Tucker stone(d,ptmlaw.com Leslie Nolte nolteacademy(a,msn. com CEO, The Nolte Academy of Dance Christopher Okiishi cokii shi(a ,,hotmail . com Meadowlark Psychiatric Services Jennifer Richman TE 2010 (1)