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HomeMy WebLinkAboutMin - Economic Development Corporation - 2006 - 10/18 - RegularALLEN ECONOMIC DEVELOPMENT CORPORATION (AEDC) BOARD OF DIRECTORS REGULAR MEETING October 18, 2006 Board Kurt Kizer Tim Wood Carl Clemencich Mark Pacheco Maxine Sweet Staff Robert Winningham Jennifer Grimm Dan Bowman Call to Order and Announce a Ouonnn Present Guests David Noble Kevin Santaulaiia Nicol Hebert Ron Hanson Eric Benavides Ron Roberto (by telephone) David Jarvis (by telephone) With a quorum of the Board present, the Regular Meeting of the Allen Economic Development Corporation (AFDC) was called to order by President Kurt Kizer at 6:15 p.m. on Wednesday, October 18, 2006 at the AFDC Office. The following items were discussed: 1. Approve Minutes of the September 20, 2006 Regular Meeting of the AEDC Board of Directors On a motion by Maxine Sweet, seconded by Carl Clemencich, the Board approved the minutes of the September 20, 2006 Regular Meeting of the AEDC Board of Directors. 2. Approval of AFDC Financial Reports Dan Bowman presented the AEDC financial reports. On a motion by Tim Wood, seconded by Maxine Sweet, the Board approved the AFDC financial reports as presented. 3. Election of Officers for the Allen Economic Development Corpomtion Board of Directors Officers were elected for the cument fiscal year. Kurt Kizer was elected President, Tim Wood was elected Vice President, and Carl Clemencich was elected Sec atary/Treasurer by acclamation as nominated by Maxine Sweet The officers will serve in these capacities until October 2007 4. Citizen's Comments No citizen comments were made. Allen Econoonc Develop,,.w Co porno.,, Regular A9eenng, Oclober 18,1006 Page 2 5. Convene into Closed Executive Session. The Board convened into closed executive session at 6:25 p.m. to deliberate commercial and financial information and economic incentives fm the following: • Reconsideration of incentives for the Retention and Expansion of Project Wi-Fi • Discussion of Development Scenarios for Allen Station Business Park • Reconsideration of Incentives for Twin Creeks Business Center • Consider Recommendation for Modification of the Tax Abatement Agreement By and Among Millipore Corporation, the City of Allen, Collin County, and the Collin County Community College District • Consider Modification of the Economic Development Agreement Between the AEDC and Millipore Corporation • Reconsideration of Incentives for the Retention and Expansion of Celerity, Inc. • Recruitment of Project Eagle • Recruitment of Project Tel -Drug Reconvene in Open Session The Board reconvened into regular session at 8:56 p.m. 14. Consider and Take Action for the Reconsideration of Incentives for Allen Towne Square, LT Eric Benavides, Allen Towne Square L.P., appeared before the Board to request an extension of the deadline for commencement of construction on the multi -use "town community center' development located at the southwest comer of Cedar Street and McDermott Drive. The developer had to purchase 15 separate tracts of land for this development, which has delayed construction. Negotiations to purchase one of the tracts from the Allen Independent School District took over one year to complete. In addition, this is one of the first projects in the Allen Central Business District since a new zoning ordinance for the Central Business District went into effect. There have been delays as the City of Allen worked to determine how best to apply the zoning regulations to the development. The developer anticipates that construction will eonttnence on the development no later than January 31, 2007 Benavides informed the Board that the City of Allen Planning and Engineering Departments are very close to approving plans for the development. The developer has been focused on the recruitment of small retailers and office tenants to the development and currently anticipates that the development will be 50% office and 50% retail. Benavides distributed pictures of buildings that reflect that type of architectural style that will be present in the development. The developer is very conscious of the residential neighborhoods located to the south and east of the development and will make sure the development does not emit loo much light as part of the lighting plan. The developer plans to screen equipment on the property sufficiently to meet City of Allen codes. Allen Ecormrrac Developwenl Corpor inion Regular Afeenng, Oclober 18, 1006 Page 3 On a motion by Carl Clemencich, seconded by Mark Pacheco, the Board approved the modification of the Economic Development Agreement between the AEDC and Allen Towne Square, L.P., executed June 30, 2006, to extend the deadline for commencement of construction for the project from August 31, 2006 to January 31, 2007, IS Consider and Take Action for the Approval of the Landscaping, Lighting and Site Plans for Allen Town Square, LP. The developer did not have the plans ready to piesent. The developer will appear before the Board to obtain approval of the plans prior to commencement of construction on the development. No action was taken on this item, 22. Convene into Closed Executive Session. The Board convened into closed executive session at 9:18 p.m. to deliberate commercial and financial information and economic incentives for the following: • Reconsideration of Incentives for the Retention and Expansion of Project Wi-Fi • Discussion of Development Scenarios for Allen Station Business Park • Reconsideration of Incentives for Twin Creeks Business Center • Consider Recommendation for Modification of the Tax Abatement Agreement By and Among Millipore Corporation, the City of Allen, Collin County, and the Collin County Community College District • Consider Modification of the Economic Development Agreement Between the AEDC and Millipore Corporation • Reconsideration of Incentives for the Retention and Expansion of Celerity, Inc. • Recruitment of Project Eagle • Recruitment of Project Tel-Dmg Reconvene in Open Session. The Board reconvened into regular session at 9,48 p.m. 6 Consider and Take Action on the Reconsideration of Incentives for the Retention and Expansion ofProiect Wi-Fi Company representatives did not appear before the Board. No action was taken on this item, Allen Economic Development Crnpmvmon Regular d4eeting, October /8, 1006 Page 4 7 Consider and Take Action on Allen Station Business Park Several developers are currently working with the landowner for Allen Station Business Park, a 102 - acre business park located east of US Highway 75 on the north side of Exchange Parkway, to purchase land in the park. Dave Noble, Trammell Crow Company, appeared before the Board to discuss development scenarios for Allen Station Business Park. Mark Pacheco abstained from discussion on this Item. No action was taken on this item. 8 Consider and Take Action on the Reconsideration of Incentives for Twin Creeks Business Center Kevin Santaularia, Bradford Company, appeared before the Board to request additional assistance to support the development of Twin Creeks Business Center, an approximately 180,000 -square foot office/warehouse development at the northwest corner of Exchange Parkway and Raintme Circle. The Board previously approved an incentive grant in the amount of $250,000 to support this development. The developer has purchased 12 -acres and gone through an extensive planning/design process for the development. This project would provide lease space for small tenants in the 15,000-30,000 square foot range and would include dock -high doors. There is a lack of this type of space in Allen. Oil a motion by Maxine Sweet, seconded by Carl Clemencich, the Board approved a modification to the Economic Development Agreement between the AEDC and Bradford Development Company, executed May 4, 2006, to increase the incentive grant from $250,000 to $500,000. Payments will be made on the following schedule: • $120,000 to be paid upon the company following the receipt of a certificate of completion for the project • $170,000 to be paid upon the first anniversary of the receipt of a certificate of completion for the project • $210,000 to be paid upon the second anniversary of the receipt of a certificate of completion for the project The Board also moved to modify the Economic Development Agreement to require that the company mountain the following taxable real property value on the improvements: • $5 million taxable value as of January l of the fust full calendar year following the completion of construction • $6.5 million taxable value as of January 1 of the second full calendar year following the completion of construction • $8 million taxable value as of January I of the third full calendar year following the completion of construction All other requirements in the original Economic Development Agreement with Bradford Development Company remained the same. Mark Pacheco abstained from discussion and voting on this item. Allen Econumre Development Ca pora0oa Regular Meeting. October l8, 2006 Page 5 Nicol Hebert, representing Celerity Inc., and Ron Hanson, tepresenting Entegris Corporation, appeared before the Board to update the Board on the ownership of the assets located at 915 Enterprise Boulevard (previously owned by Millipore Corporation) and to discuss issues related to the tax abatement agreement with Millipore Corporation (executed September 1, 1998). The tax abatement agreement with Millipore Corporation went into effect on January 1, 1999 and provided a 50% tax abatement for 10 years on real and business personal property (excluding inventory). The agreement required that an appraised value of $20 million in combined real and personal property value (excluding inventory) be maintained at the facility for the full 10 year term of the tax abatement. Data from the Collin County Appraisal District indicates that the company's Allen facility has produced approximately $196.2 mullion in appraised value (applicable to the requirements of the tax abatement agreement) on the tax rolls since the inception of the agreement A total cumulative appraised value of $200 million was expected under the tax abatement agreement. On a motion by Maxine Sweet, seconded by Mark Pacheco, the Board approved a recommendation to the City of Allen, Collin County, and the Collin County Community College District for the termination of the Tax Abatement Agreement executed September 1, 1998 by and among the City of Allen, Collin County, Collin County Community College District, Millipore Corporation, Dallas/Fort Worth Real Estate Investments #1 L.P., and EBP 3 Ltd, without requiring the repayment of previously abated taxes or penalties associated with delinquent taxes. 10 Consider and Take Action on the Modification of the Economic Development Agreement Between the AEDC and Millipore Corporation Nicol Hebert, representing Celerity Inc., and Ron Hanson, representing Entegris Corporation, appeared before the Board to discuss issues related to the Economic Development Agreement with Millipore Corporation (executed August 24, 1998). Data from the Collin County Appraisal District indicates that the company's Allen facility has produced approximately $306 million in appraised value (applicable to the requirements of the economic development agreement) on the tax rolls since the inception of the agreement. A total cumulative appraised value of $200 million was expected under the economic development agreement. On a motion by Maxine Sweet, seconded by Mark Pacheco, the Board approved the termination of the Economic Development Agreement executed August 24, 1998 between the AEDC and Millipore Corporation without requiring the repayment of incentives or any additional penalties. 11. Consider and Take Action on the Reconsideration of Incentives for the Reatentign and Expansion of Celerity. Inc. Company representatives appeared before the Board to request the approval of modifications to the AEDC incentive offering associated with the company's expansion. The Board previously approved an incentive grant of $250,000 to support the expansion, based on the company maintaining a taxable Allen Economic Developmem Cmpwnlmn Regular Meering, October 1R, 2006 Page 6 business personal property value that is $5 million greater than the company's 2006 taxable business personal property value for five years from the point at which the company reaches a total employment of 300. The company updated the Board on the status of their expansion. At the time that the Board approved incentives for the expansion, the Board was not aware that the company is not liable for the previous tax abatement and economic development agreements associated with their Allen facility. Since the company does not have to maintain the $20 million annual appraised value required by these previous agreements, the required value approved by the Board for the Company's current expansion ($5 million greater than the company's 2006 taxable business personal property value) is now lower than expected. On a motion by Carl Clemencich, seconded by Mark Pacheco, the Board approved a modification to the incentive offer for Celerity, Inc. to require that the company maintain $8 million in taxable business personal property value for a period of five (5) calendar years, beginning January I, 2007 All other elements of the original incentive offering for Celerity, Inc. remained the same. 12 Consider and Take Action on the Recruitment of Project Eagle The Board discussed the status of the project. No action was taken on this item. 13 Consider and Take Action on the Recruitment of Proiect Tel -Dog The Board discussed the status of the project. No action was taken on this item. 16. Consider Amiroval of Revisions to the Covenants and Restrictions for Allen Central Park With the construction of an office building in Allen Central Park by Duke Realty, the AEDC has been working with Duke and the other property owners in the park to establish a property owner's association. As part of that process, the AEDC is revising the Covenants & Restrictions (OCRs) for Allen Central Park. A draft of the Allen Central Park CCRs that included suggested modifications, based on input from Duke Realty, AEDC staff, and AEDC attorney Pete Smith, was distributed to the Board. The CCRs must be approved by all property owners in Allen Central Park, including the AEDC Board. On a motion by Maxine Sweet, seconded by Carl Clemencich, the Board approved the revisions to file Covenants and Restrictions for Allen Central Park as presented. Maxine Sweet requested that Pete Smith, AEDC attorney, review changes suggested by Duke Realty to section 2.3 of the document before the AEDC proceeds with seeking approval of the document by other parties in the business park. Mark Pacheco abstained from discussion and voting on this item. 17 Consider and Take Action on the Reconsideration of Incentives for the Rectintment of Prosect Cork Company representatives appeared before the Board on September 20, 2006 to request assistance to support their location into 120,000 SF at 300 E. Bethany Drive. The AEDC Board approved an Allen Economic Development Corporation Regular Meering, October 18,1006 Page 7 incentive grant in the amount of $650,000 for Project Cork to support this project, contingent upon the following: • The company must sign a 7 -year lease (with a 7 -year option) on approximately 120,000 -square feet of space at 300 E. Bethany Drive. • The company must have 100 full time employment positions at the facility within 120 days of receiving a certificate of occupancy and maintain 100 employment positions for the full term of the initial lease. • The company must have $7 million in taxable business personal property as of January I" of the year following the six month anniversary of the receipt of a certificate of occupancy at 300 E. Bethany Drive, and maintain $7 million in taxable business personal property for the full term of the initial lease. The Board required that the company maintain $7 million in taxable business personal property for the term of the initial lease. However, the project impact analysis on which the Board based their decision was calculated based on the company maintaining a taxable business personal property value of $5 million for the term of the initial lease. Company representatives have indicated to AEDC staff that the company would not be able to maintain $7 million in taxable business personal property for the term of the initial lease. On a motion by Maxine Sweet, seconded by Mark Pacheco, the Board approved a modification to the incentive offer for Project Cork to require that the company maintain $5 million in taxable business personal property as of January 1 at of the year following the six month anniversary of the receipt of a certificate of occupancy at 300 E. Bethany Drive, and maintain $5 million in taxable business personal property for the full term of the initial lease. 18 Discuss Administrative and Marketing, Activities of the AFDC. Jennifer Grimm updated the Board on marketing activities and invited the Board to attend the Cornerstone Development luncheon being held at their newly constructed 60,000 square foot building at Ridgemont Drive and US 75 on October 25, Mark Pacheco mentioned that Robert Winningham did a good Job at the recent ICSC convention in San Antonio. Kurt Kizer mentioned that Allies Day went well. Dan informed the Board that the Rocovich family is no longer planning to purchase the BSM Financial Center building located at Ridgemont Drive and US 75. 19. Executive Director's Report Robert Winningham gave the Executive Director's Report. The following items were mentioned: • Pete Smith, AEDC attorney, may sit in on future AEDC Board Meetings • A Special Called Board Meeting may need to be scheduled prior to the next Regular AEDC Board Meeting Kurt Kizer and Maxine Sweet stated a preference for not scheduling a Special Called meeting unless it is absolutely necessary. Allen Economic Development Coipomlwn Regular Meeting, Ocrobe, 18, 2006 Page 8 20 Scheduling of Next AFDC Boa)d of Directors Meeting, The next Regular Board meeting was scheduled foo November 15, 2006 at 6:00 p m 21 Adjourn. On a motion by Maxine Sweet, seconded by Tim Wood, the meeting was officially adjourned at 10:05 p.m. These mint s approved this 15" day of November, 2006. Kurt Kizer, stdent Carl Clemencich, Secretary