The URL can be used to link to this page

Home My WebLink About07-10-2007 Council Economic Development Committee AGENDA City of Iowa City City Council Economic Development Committee Tuesday, July 10, 2007 8:30 a.m. Lobby Conference Room City Hall 1. Call to Order 2. Approval of Economic Development Committee Minutes, May 31, 2007 and June 21, 2007 3. La Reyna CDBG Loan security - Hightshoe 4. Alpla Expansion Tax Abatement Request - Ford 5. Update on Downtown Market Niche Analysis - Ford 6. Committee time 7. Adjournment MINUTES CITY COUNCIL ECONOMIC DEVELOPMENT COMMITTEE JUNE 21, 2007 CITY HALL, LOBBY CONFERENCE ROOM Preliminary Members Present: Regenia Bailey, Connie Champion, Bob Elliott Members Absent: none Staff Present: Wendy Ford, Jeff Davidson Others Present: Nancy Quellhorst, Tracy Hightshoe, Loren Ditzler (Area Chamber of Commerce); Joni Schrup (Discerning Eye); Connie and Alex Legaspi (La Reyna, Inc.) RECOMMENDATIONS TO CITY COUNCIL: Bailey moved and Champion seconded that Extend the Dream be referred to Aid to Agencies. Motion carried. Hightshoe will notify Walz of the decision. Champion moved to proceed with the $35,000 loan to Discerning Eye. Bailey seconded; motion carried. CALL MEETING TO ORDER: Bailey called the meeting to order at 8:34 AM. APPROVAL OF MINUTES OF MAY 29.2007: Elliott moved that the minutes be approved as distributed. Motion passed. EXTEND THE DREAM LEASE - CDBG application, deferred from May 29,2007. Tom Walz had been asked to provide a fundraising plan and additional expense detail for 401 South Gilbert. Hightshoe reported that Walz did present some expense information last week, but it was not representative of all operational expenses. Bailey met with Walz to look at the fund raising plan, which is still inadequate. Operating neither on a social development nor a business model, Hightshoe indicated they would continue to have funding difficulties. They do have CDBG money to hire someone to do accounting and bookkeeping. Bailey moved and Champion seconded that Extend the Dream be referred to Aid to Agencies. Motion carried. Hightshoe will notify Walz of the decision. UPDATE ON DISCERNING EYE - CDBG APPLICATION: It was approved at the last Economic Development meeting that Discerning Eye be awarded a $35,000 CDBG loan. Since then, however, a concern arose about a question on the application regarding bankruptcy. Schrup had reported no bankruptcies, but appeared today to provide additional detail. She said there had been a bankruptcy, but was informed by her attorney that she need not report it after seven years. The bankruptcy occurred fourteen years ago. Hightshoe recommended the committee go by banking rules, disregarding bankruptcies beyond seven years. Elliott inquired whether there were any federal regulations relating to this situation attached to CDBG funds; Hightshoe said no. Discerning Eye is applying for an SBA loan in addition to the requested CDBG funds. Bailey and Champion indicated they had no problem with this; Schrup need not have disclosed the bankruptcy. Elliott noted that the form says "have you ever"; with that wording it must be disclosed. Elliott reiterated his concern regarding this competition with businesses that did not use taxpayers'money. He also wondered how much the $35,000 would help the problems with cash flow and Economic Development Committee June 21, 2007 Page 2 the reduction of debt. Bailey responded that the $35,000 would make a significant difference. Hightshoe said $35,000 is the maximum the city can provide. Champion moved to continue with the $35,000 loan to Discerning Eye. Bailey seconded; motion carried. Ford suggested changing the wording on the application to "have you ever declared bankruptcy within the last seven years". Elliott disagreed, noting that nothing tells us more about the future than the past; however, he will support the majority. Bailey asked Ford to revise the wording on the application. UPDATE ON LA REYNA - CDBG APPLICATION: The legal department has ruled that we cannot secure a $100,000 loan by attaching a lien on La Reyna's mortgage because it is a contract purchase. If the business declared default, all junior liens would be voided. Staff is now working with La Reyna to determine to what we can use as security. Because it will most likely be equipment and there is likely not $100,000 worth, the loan will probably be less than $100,000. Hightshoe hopes to have this ready for the July 10 Council agenda. DOWNTOWN MARKET NICHE ANALYSIS - STAFF UPDATE: Ford reported Marketek will have all of their hard statistical analysis done by the end of next week. Marketek's next task will be determining supply versus demand for downtown office space. The two surveys are out; there is good response to the consumer shopping survey, but the business survey is lagging. Quellhorst will send out reminders today and push Chamber board members. Ford noted that Bosch would be more than happy to talk with anyone who desires to provide input. Marketek will begin reporting in October, when there will be an opportunity to review and comment on a preliminary report. The first interim report, not for wide distribution, will actually be out in about ten days. The final report is due in December. Marketek may not be officially in town before October, although individuals may be here from time to time. ADJOURNMENT: Bailey adjourned the meeting at 9:00 AM. Next meeting is scheduled for Tuesday, July 24, 8:30 AM, in the City Hall Lobby Conference Room. Submitted by Carolyn Kohler sfpcdfminsfecodevf2007 f6.21-07ed .doc (I) (I) ~ E E o () +J r:: (I)"C E 0 0.0 o (I) -~ (1)(1)..... >00 (I) CO C CG N U"g .- (I) E= 0< r:: o U w (,) r:: ::::J o () 't"" N - >< >< >< CD 't"" UJ 55 - >< >< 0 en N - >< >< >< II) N 't"" ~ >< >< >< CD ~ >< >< >< N 't"" - >< >< >< M CD e >< >< >< M l"- N - >< >< >< N C) N - >< >< >< N en ~ >< >< >< M ~ >< >< >< 't"" <0 <0 <0 II) 0 ~ 0 E.~ - - C'\I C'\I C'\I 0 0 0 ....a. - - - 0) X ..- ..- ..- I-UJ 0 0 0 c 0 >- 'Q. .! E 'n; cu m ::: .c .!!! .2 (,) 0) c W .~ Q) c E C) .Q C ro Q) 0 0 Z 0:: m (,) -0 0) II) ::J (J X UJ-o :;:'0) 'E-CII) O)cO)::J II) 0) II) (J 0)11).0 X .....o<(UJ a..<( :;:, .. II II II ~ >. UJ II) 0) -.0 ~><oo<( City of Iowa City Application TIF Tax Rebate or Tax Abatement\Exemption Business Requesting Financial Assistance: ALPLA, Inc. Business Name: _Alpla, Inc. Name of Authorized Person to Obligate the Business: _Dietmar Hofmarcher Business Address: _289 Highway 155 South, McDonough, GA 30253 Business Contact Person: _Dietmar Hofmarcher Title: _CFO Telephone: _770-305-7639 Fax: _770-305-7646 E-mail Address: _dietmar .hofmarcher@alpla.com Business Federal ID#: 58-2611718 Date of Application Submittal: _06-08-2007 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 representations; 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. SIGNATURE OF COMPANY OFFICER AUTHORIZED TO OBLIGATE BUSINESS: (submitted electronically) NOTE: The City will not provide assistance in situations where it is determined that any representation, 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, 1. What is the location of the proposed project? Iowa City, IA 52240, Heinz Road 2. Please provide a brief timeline for the proposed project. We plan to extend both our warehouse and manufacturing building, starting Fall 2007 3. Describe in detail the proposed "project" (e,g" company relocation, plant expansion, remodel- ing, new product line and/or new facility). Plant Expansion to make room for additional business (new production line "closures'') and relocation from machinery from one of our manufacturing facilities at Heinz Road to the other manufacturing facility at Heinz Road we plan to expand. 4. Specifically, what type of capital improvements will be completed? (e.g. new building, remodeling, fac;ade improvement, accessibility) New building (warehouse and manufacturing) 5. Will the project increase the value of the property by at least 15%? Please include the amount of the proposed investment. Yes, approximately 5 Million US$ 6. Type of assistance requested: (check one) Tax Increment Financing Tax Exemption Tax Abatement _x_ 7. If an existing Iowa City business, how many total individuals have been employed by the company at the Iowa City facility during the past year? Approx. 200 8. What is the number of jobs within the existing or proposed Iowa City facility and what is the starting average hourly wage rate (not including fringe benefits): For the new employees? _14.00 For existing employees? _14,00 For existing and new employees? _14,00 9. Does the business provide standard medical and dental insurance for full-time employees? If so, what percentage of the standard medical and dental insurance package expense does the company provide? Yes, individual and spouse coverage 80%, family coverage 70% 10. Beyond the present project, what future growth potential is there for the Iowa City operation? Alpla grew 200% within 3 years, and there are no plans to end the growth 11. Please describe the energy and resource efficiency programs, waste reduction, waste exchange, and/or recycling programs at your Iowa City operation. Up to 10% of raw material is replaced by PCR and regrind 12. Do you use recycled materials in the production of any products or through the provision of any services at your facility? If so, please describe. Up to 10% 13. Has the business been cited or convicted for violations of any federal or state laws or regulations within the last five years (including environmental regulations, Occupational Safety And Health 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