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HomeMy WebLinkAboutMin - Economic Development Corporation - 2011 - 09/21 - RegularALLEN ECONOMIC DEVELOPMENT CORPORATION (AEDC) BOARD OF DIRECTORS REGULAR MEETING WEDNESDAY, SEPTEMBER 21, 2011 Board Staff Guests Tim Wood Robert Winningham (none) Susan Bartlemay Daniel Bowman Carl Clemencich Ryan Shook Gary Caplinger Garrett Weaver Scott Sutherland Pete Smith Call to Order and Announce a Quorum Present With a quorum of the Board present, the Regular Meeting of the Allen Economic Development Corporation (AEDC) was called to order by President Tim Wood at 6:08 p.m. on Wednesday, September 21, 2011 at the AEDC Office. 1. Update on Issues Related to the Allen Independent School District Mark Tarpley and Tim Carroll of the Allen Independent School District (AISD) updated the Board on the issues related to the AISD. Tarpley explained that the school district is experiencing a budget shortfall as a result of changes in legislation by the State of Texas Supreme Court dating back to 2006. Tarpley noted that the tax increase proposed by the School Board is one of several initiatives to correct the budget deficit The AISD Board of Trustees has also approved cuts to the AISD operating budget. The school district has proposed a property tax rate increase from 1.04 to 1.17 per $100 dollar valuation. Tarpley noted that there will be a $7.8 million decrease in the AISD operating budget for the next fiscal year. Tarpley indicated that the budget cuts have resulted in an increase in the student -to -teacher - ratio due to the loss of 55 teaching positions throughout the school district. Tarpley noted that the elementary school student -to -teacher -ratio will increase from 19.9 students -per -teacher to approximately 21.4 students -per -teacher. Tarpley also noted that the AISD is faring better than many school districts across the State of Texas. Keller ISD has cut transportation in their school district to help correct its budget deficit. Susan Bartlemay inquired about the annual funding per student in the school district. Tarpley noted that the average annual cost per student is approximately $6,900, and the school district has received a five-star rating from the State Comptroller's office for its spending efficiency Scott Sutherland inquired about the impact the budget shortfall has had on teacher salaries. Tarpley noted that the AISD and surrounding school district have not been offering salary raises, but the AISD remains competitive in its teacher salaries compared to similar school districts. AED(' Meering Minute, .September 21, 2011 - Page 2 Carl Clemencich inquired about how the current changes in operations have affected teacher �! morale. Tarpley mentioned that an increase in class size has presented the possibility of ® having more disruptive students in a single class, which makes it more difficult for teachers to do theirjobs. Tim Wood inquired if the school district could raise property tax rates incrementally over a two year period. Tarpley noted that the school district could propose several tax increases incrementally, but each increase would require a separate election. Susan Bartlemay inquired about how new uniforms for extracurricular activities have been funded under the new budget Tarpley noted that many of the uniforms for athletics have been sponsored by Nike, and bond funds paid for the remainder of new uniforms. Susan Bartlemay inquired about how the budget shortfall has impacted the staffing levels of administrative positions. Tarpley noted that seven administrative positions have been eliminated due to the budget situation. 2. Approval of the Minutes of the August 9 2011 AEDC-City Council Workshop On a motion by Gary Caplinger, seconded by Carl Clemencich, the Board unanimously approved the Minutes of the August 9, 2011 AEDC-City Council Workshop as presented. 3. Approval of the Minutes of the August 17, 2011 Regular Meeting On a motion by Gary Caplinger, seconded by Carl Clemencich, the Board unanimously approved the Minutes of the August 17, 2011 Regular Meeting as presented 4. Ratification of an Economic Development Agreement with No Magic Inc Robert Winningham presented the AEDC Economic Development Agreement with No Magic, Inc. and requested that the Board ratify the agreement. Winningham noted that the AEDC has negotiated and executed an Economic Development Agreement with No Magic, Inc. based on the direction and terms specified by the Board The agreement provides a $25,000 grant payable upon the company's receipt of a Certificate of Occupancy for approximately 10,000 -square feet of space in Allen, execution of a 5 -year lease, and the verification of 21 new employment positions in Allen. An additional $25,000 shall be paid within 6 months of the receipt of a Certificate of Occupancy An additional $30,000 grant is available to the company in annual installments to be paid based on job creation. The company will receive $1,000 per full time employment position created in Allen each year, up to a maximum cumulative total of $30,000 to be paid out over years two, three, four and five. On a motion by Carl Clemencich, seconded by Gary Caplinger, the Board unanimously ratified the Economic Development Agreement with No Magic, Inc. AEDC Meeting Minutes September 21, 2011- Page 5. Consider and Take Action Regarding Terms of an Economic Development Aereement with TelStrat International Ltd. Robert Winningham presented the terms of an Economic Development Agreement with TelStrat International Ltd. to the Board. Winningham stated that the AEDC was recently approached by TelStrat International Ltd., a software company that is currently located in Plano and is considering relocating its corporate headquarters to Allen. The company would sign a 5 -year lease to occupy over 17,000-sf at the Office Campus at Allen located at Ridgemont and US 75. The lease would commence in November of 2011. The company would initially employ 34 individuals at the facility, increasing to 42 employees over a 5 -year period Winningham stated that the AEDC has been working with TelStrat to provide a reasonable incentive grant to encourage the company to locate in Allen, as opposed to options in Plano and McKinney. Based on these conversations, AEDC staff sent the company a preliminary proposal to provide a $25,000 incentive grant to support TelStrat with their corporate relocation. On a motion by Carl Clemencich, seconded by Gary Caplinger, the Board unanimously approved authorizing the Executive Director to negotiate and execute an Economic Development Agreement with TelStrat International Ltd. based on the terms provided. 1 6. Convene into Closed Executive Session The Board convened into closed executive session at 7:00 p.m. to deliberate real property, commercial and financial information and economic incentives for the following: • Consider Incentives for the Recruitment of Project Appaloosa Polhna • Consider Incentives for the Recruitment of Project Big Top • Consider Terms of the Economic Development Agreement with Project Whistler Reconvene into Open Session: The Board reconvened into regular session at 7'40 p.m. 7 Actions Resulting from Executive Session On a motion by Susan Bartlemay, seconded by Gary Caplinger, the Board authorized the Executive Director to negotiate an Economic Development Agreement with Project Appaloosa Polhna per the Board's direction 1 8. Approval of AEDC Financial Reports Daniel Bowman presented the AEDC financial reports. Bowman noted that the AEDC plans to make payments to No Magic and Atlas Copco in September. AFDC Meeting Minutes September 21, 2011 - Page J Bowman also noted that sales tax revenue for the current fiscal year is 3 -percent greater than the budgeted amount and has shown a 16 -percent increase over the prior year. Peter Vargas mentioned that sales tax revenue collections are 6 -percent ahead of schedule for the current year. On a motion by Scott Sutherland, seconded by Susan Bartlemay, the Board unanimously approved the AEDC Financial Reports as presented. 9 Discuss Administrative and Marketing Activities of the AEDC, Upcoming Events and Local Partnerships Robert Winningham updated the Board on the administrative and marketing activities of the AEDC, upcoming events and local partnerships. Winningham noted that AEDC staff recently toured the Frontier Communications facility at 805 S Central Expressway. The ribbon cutting for Frontier Communications is scheduled for January of 2012. Winningham mentioned that there will be a new design for the annual AEDC Water Bill Insert. Winningham also noted that AEDC staff will meet with Collin County on Thursday, September 22 to discuss Collin County's position on tax abatements. Winningham noted that the AEDC Staff will be attending the annual Texas Economic Development Council Conference at the Renaissance Hotel in Fort Worth. The conference will be held during the first week of October. Winningham also noted that Elizabeth Morris will be presenting the AEDC Biannual Economic Impact Report to the City Council on Tuesday, October 11`n Winningham mentioned that AISD superintendent, Dr. Ken Helvey, wishes to extend an invitation to the AEDC Board to tour the new high school Career -Tech Center. 10. AEDC Executive Director's Report Regarding Office, Industrial and Retail Proiects No additional projects were mentioned. 11. Determine Next Meeting Date The next AEDC Board meeting was scheduled for Wednesday, October 19, 2011 at 6:00 p.m. 12. Convene into Closed Executive Session The Board convened into closed executive session at 8:10 p.m. for the annual review of the AEDC Executive Director / CEO. Reconvene into Open Session The Board reconvened into regular session at 9:50 p.m. L 1 I AFDC Meeting Minutes September 21, 2011 - Page 5 13. Consider and Take Action Relating to the Annual Performance Review of the Executive Director/CEO On a motion by Gary Caplinger, seconded by Susan Bartlemay, the Board unanimously approved a motion to increase the annual car allowance and base salary of the Executive Director/CEO, effective October 1, 2011, and to award a bonus for meeting AEDC's annual goals. 14. Adjournment The meeting was officially adjourned on a motion by Gary Caplinger, seconded by Susan Bartlemay, at 9:52 p.m. These Minutes approved this 191h day of October 2011. Tim Wood, President Carl Clemencich, Secretary/Trea er