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Min - Economic Development Corporation - 2014 - 02/22 - WorkshopALLEN ECONOMIC DEVELOPMENT CORPORATION (AEDC) BOARD OF DIRECTORS SPECIAL CALLED MEETING AEE C BOARD PLANNING RETREAT SATURDAV, FEBRUARY 22, 2014 Board Staff (3fuests Scott Sutherland Dan Bowman Peter Vargas I Michael Schaeffer Pete Sinith Greg Kennedy Joey Herald Jeff BUrkbardt Call to Order and Announce a Quoruni Present With a quorum of the Board present with members Scott Sutherland, Michael Schaeffer, Greg Kenriedy,Joey, 11'erald and Jeff Burkhardt in attendance, the Special Called Meeting of the Allen Economic Development Corporation (AEDC) Board of Directors was called to order by President Scott Sutherland at 8:36 a.m. on Saturday, February 22, 2014 at the AEDC Office. Convene into Closed Executive Session-, Pursuant to,rexas Government Code, Section 55 LOU: 2cliberation ol'Eco'nornic D and Financial Information and Economic incentives for the Followin& a. Consider Inceiitives to Suppoil the Retention and Expansk)n of I.,ocal Businesses Convene into Closed Executive Session: Pursuant to Texas Govern11crit Code, Section 5 1j)72 - Deliberation of the Sale, L'urejhase, Exella Las or Value of'Real Puoluert a. Consider Sale of AEDC-Owned Tract in Millennium Technology Park I b. Consider Purchase of Land in Millennium Technology Park The Board converted into closed exceut�ive session at 8:38 a.iu Reconvene into CI en Session The Board reconvened into regular session at 9 -20 a.m. 2. A,ctions Resulting fi-orn Executive Session, On a motion by Jeff'Burkhardt, seconded by Michael Schaeffer, the Board unanimously authorized the Interim Execative Director to negotiate and execute as purchase and sale agreement with J Realty for,+/- 4,302 acres at the southeast corner of Century Parkway and Butler, On a motion by Michael Schaeffer, seconded by Joey Herald, the Board unaninIOUSly authorized tile ]Interim Executive Director to negotiateand execute an option agreement, to purchase +/- 4 acres in MillenniurriTechnology Park. AEDC Special Called A&(Wng AlAnaes February 22, 2014 - Page 2 3. presentation by Dail Bowman: Review of AEDC Oraa,nizational Structure anti Recommendations Iardii he Executive PJrector`9 J�plc.Now and in tlne Future Scott Sutherland updated the Board and indicated that lie had requested that Dan Bown-lan, Interim Executive Director of the AEDC, to provide tile Board with a review of the AEDC organizational structure and provide rceonimendations, regarding the Executive Director's role now and in the future, Sutherland indicated that Bowman has visited with representatives from other economic development agencies in order to assess how these sucoessftd agencies function and compare them to the AEDC', Bowman provided an overview of the current AEDC organ i zationa I structure and described the functions that are perfornied, by each individual staffposition. Bowman believes the key goals of the AEDC to be the develOpfuent Of Strategic partnerships with Allen property owners, investors and real estate developers, lead generation for quality business prospects within our target industries,, marketing eft"orts to reach companies considering relocation, research that focuses on the development of data to influcrice prospects, deal closing, business retention and expansion, and development efforts oil SH 12 L In the short run, Bowman recommended that the AEDC focus on technology improvements to make the office more efficient, including faster fiber service, a comprehensive Customer Relationship Management (CRM) solution, additional laptops, and storage of AEDC data in the cloud to facilitate remote access, Bowman also reconirnended that the Board authorize tile Interim Executive Director to hire an Administrative Assistant and hire an Economic Development Recruitnient and Research Consultant in order to assist with projects and other strategic initiatives, In the long run, Bowman recommended an organizational structure that involved hiring additional full tirne employees, including a Director of Research and Marketing to assist with projects and strategic data and lead generation initiatives and allusiness Retention and Expansion Specialist to focus on local expansion projects, an Economic Development Strategist to pursue lead development. Bowman also recommended having an intern occasionally and filling the currently vacant AFIDC Assistant Director position, It was also recommended that the Executive Director position be focused on deal closing and addressing strategic priorities of the organization. Bowman indicated that the additional stiffbeing proposed would increase the AEDC'personnel budget by approximately 3,3%, Based on other costs that Bowman proposed to CLIt in the AEI C operations budget, tile overall AEDC operations budget would increase by 5% or a total of $50,000 - $ 100,000 with the new personnel costs. Bo man notedthat the AEIEC:' should employ a data -driven approach for its marketing and lead generation efforts, He also recommended that the AEDC process for management of projects Should be modified to ensure that tile most important projects receive the most attention fro nn staff at the highest level. 'file recommended process would involve the following steps: New AEDC leads are generated ftorn proactive and reactive sources 2. Significant direct leads frorn business prospects specifically interested in Allen are Funneled directly to the AE C". Executive Director, 3Other loads are vetted by the Director ot'Rescarch & Marku(Ing and the AEDC Assistant Director. AE C � pechd Called A,Aeefing Minules� Februcay 2'2, 2014 .- Page 3 4. The AED,C Executive Director works with the AE'.DC Board Chairman to formulate a Preliminary Incentive Proposal for delivery to the prospect. 5. All outstanding Preliminary Incentive Proposals will be include(] in the AEDC Board Packet for review, 6, The AEDC Executive Director will negotiate the terms of the final incentive proposal with the company, The project will be brought before the Board once the following has been accoTriplislied: a All relevant and obtainable impact data has, been received and analyzed The company has identified an Allen real estate option(s) and entered far enough into negotiations to know that a lease or sale could realistically be consunimatcd The company has entered into negotiations on incentives with tile AEDC Board President and has reached a f'ornial an'101-111t: (or range) of incentives that they would request from Mme AEDC Board All of" this information has, been summarized into an Impact Model Summary, a Real Estate Summary, and anIncentiveSLUTUnary for Board review T Once the Board has reviewed and approved terms, the AEDC Executive Director will work with the company to develop a term sheet. 8. Only after all terms are agreed to by thcAEDC and the company will the AEDC Executive Director approach the AEDC Attorney and request that formal contracts be drafted, The final terms of the contract will be negotiated by the AEDC executive team, in consultation with the AEDC attorney. 9If requested, the contract will be brought back before the AEDC Board for final approval. Otherwise, the AEDC Executive Director may be authorized to execute the negotiated contract, Bowman also noted that a prelimililary proposal should be employed instead of using a non-binding Memorandum of Understanding (MOU) or Letter of Intent: (L.01), that is subject to legal review by the AEDC attorney. The Board indicated that they preferred an organizational chart that Would Tninimize the number of employees that directly report to the Executive Director, That would tree the Executive Director to ,spend irlore time on strategic priorities and key prqjects. T he Board recommended that an organizational structure be considered that would change the reporting relationships and have more positions reporting to the Assistant Director, 1t; was also requested that the requirenients, of the Assistant Director position be better defined. It was discussed that the various eniployees of the organization need to be able to manage pr(�Jccts independently, It was discussed that in the past, the Executive Director had been a business develolirrierit or marketing position. The Board preferred that the Executive Director be a leader and not be primari ly focused on niarketing. AEDC Spechil Called Aketing Afinwes Febrawy 22, 2014 - "cagey 4 4. Discussion or AEDC Strate wy to Support the Interim Exectitive Director with Execution of Duties The Board requested that the proposed new positions be prioritized and that five total employces should be considered for the AFD(", It was also indicated that many of the projects seen in the past five years have been related to business retcrition and expansion, making that: an important function of the organization, The Board also expressed that a central custorner relationship management too] is extremely iniportant for the organization, Board niernbers indicated that a comprehensive vision for the role of the Executive Director needs to be developed in order to recruit the right person ft')r the organization. It was indicated that business retention, research, and, project management are key functions that should feed into the Assistant Director, who reports to the Executive Director, It is important to have qualified people to fill each of these individual roles, The Board discussed the timing for how the restructuring of the AEDC would be implemented, It was indicated that sorne positions will be required in the coming months, but the full restructuring may take an additional 12 montlis. Bowman indicated that the current AEDC stafTcan begin to implement the new strategy. The Board generally supported the plan presented by Bowman, with the exception that several Board members preferred a five employee organizational chart, The Board requested that the Interim Executive Director bringback as revised organizational chart and job descriptions for review at a facture Board nicefin& It was indicated that the job description for the Executive Director will probably evolve over the course of the executive search process. 'rhe Board -supported the Interim Executive Director in pursuing technology improvements, including laptops, as fiber connection, a customer relationship management platform that filtegrates with Outlook, and a cloud data management Solution, ']'he Board also directed the Interim Executive Director to hire an Economic Development Research and Marketing Consultant. On a motion by Jocy,Hcrald, seconded by Jeff Burkhart,, the Board authorized the AEDC Interim Executive, Director to hire two full time employees, 5Consid .gLAVL)rq E41 of I nteri m Di -rectors S,11,jLy _--R.gLroacfi to F b ry 7 2014 e rua On as motion by Greg Kennedy, seconded by Joey Herald, the Board approved increasing the: base salary ofthe Interlin Executive Director by 10%, retroactive to, February 7, 2014, and providing a $6,000 annual car allowance effective March 1, 2014, 6. Consider A , rvol of AEDC" Marketing Phar Provide Qji:ection to Econonuc Develonnient Staff and Fstablish a Bowman Presented the revised AIDC." Marketing Budget for FY 2014. Bow=n indicated the ulip<)rtance of tracking marketing expenses, that have been incurred, niarketing coirunitnicnts for the, A EDC Special Called Afeeling Alinufav Febriiat, y 22', 2(i14 - Page 5 future, and marketing items that are planned. Between Travel, Conferences, and Marketing, the AEDC has expended $115,000. This leaves $26 1,000 for the AEDC to spend in 2014, Bowman described a variety of marketing initiatives that include sponsorships, databases, labor studies, a PR consultant, wet) and e-mail marketing, and other items. The proposed AEDC Marketing Strategy results in approximately $85,000 in, savings to the AEDC. The Board discussed how the SalesForcc,coni platform can be improved to meet the needs of the AEDC. On a remotion by Joey Herald, seconded by Michael Schaeffer-, the AEDC Board approved the AEDC Marketing Budget as presented. 7. Consider Purclulsina Authorjijtyj.jLftLAEDC Executive Director /CEO The Board discussed the way to handle approval of expenses that are outside the approved AEDC budget. The AEDC Attorney discussed the possibility of the AEDC Board approving a purchasing policy. It was also discussed that the professional staff of the AEDl C could use a credit card to purchase fogad arid alcoholic beverages for the purpose of entertaining prospects. ThcA1ZDC Attorney discussed the AEDC Personnel Policy thatwas approved by the Board ey, AEDC linerlin 1"xccutive Director and the previously. It was cicternlined that the AEDC Attoni City of Allen II R Director will meet to determine a suitable policy that specifically states which City of Allen I IR policies do not apply to the AEDC. The Board would like AEDC policies to be consistent with the City of Allen where it makes sense, and then specifically identify areas where they should differ, 8. Review and Consider Amiroval ofArneridnientsto AEDC If laws The Board asked that the AEDC Personnel Policy and Bylaws be reviewed and brought back to the Board for cons iderartioll. The Board generally approved the use of a credit card by the AEDC professional staff to cover expenses related to the entertainment of prospects, including alcoholic beverages, The Board debated whether the AEDC Bylaws should state that the AEDC, rnUSt USC the City of` Allen for certain financial services. The general COuSenSUS Of the rnaJority ofthe Board inernbers is that the AEDC',', Bylaws should reflect (hat the AEDC shall use the City of Allen for financial services, 9. Provide Direction to the Interim Director Related to All of the Above 10. Discuss Executive Director Search process Tile AEDC Interim ExCCUtive Director presented information on several executive recruitnwrit firms that could be considered by the Board, including Jorgenson Consulting, Strategic (10VC111tilent "JEDCS�Jeejul Called Mee(ing "Wipulkn Februeny 22', 20,14 - Poge 6 Resources, and Johnson & Associates. Pete Smith recommended the Waters Consulting Group, The Interim Executive Director will schedule conference calls that will give the executive search committee the opportunity to interview each of these Firms. 11. Adjournment On a motion by Michael Schaerfe:r, seconded by Jefl'Burkhardt, the mecting was adjourned at 12-25 P.111. These Minutes approved this 12'h day of March, 2014, . . . . . ... ........ - ------------- �t- Scott Sutherland, President Michael Schaeffer, Vice President