HomeMy WebLinkAboutCity Council Committees - Economic Development Corporation - 09/18/1996 ECONOMIC DEVELOPMENT CORPORATION
.� September 18, 1996
Present: Boardmembers Woods, Houser, Llewellyn and Banister.
Others: EDC Treasurer Hillman, EDC Secretary Jacober,
City Operations Director McFall and City
Attorney Lubovich.
The annual meeting was called to order at 5:30 p.m.
Approval of Minutes. Llewellyn moved to approve the minutes of
the meetings of September 11, 1995 and May 21, 1996. Houser
seconded and the motion carried.
Election of Officers. Llewellyn renominated the existing slate
of officers--Jon Johnson as Chair and Judy Woods as Vice Chair.
Houser seconded and the motion carried. It was clarified that
the Secretary and Treasurer would remain the same. (Note of
Discrepancy: The Vice Chair for the previous year was Morgan
Llewellyn. )
Financial Report. Hillman distributed copies of the balance
sheet as of December 31, 1995, and noted that assets are going
down rapidly, mostly because of the commitment to Tradec. He
predicted that 1996 will end with a balance of approximately
• $13, 000. He said that he expects about $15, 000 next year in
administrative fees, interest and so forth, and that the charges
which must be paid each year will go up. He said that there
would be about $15, 000 for the International Trade Progam if
desired, leaving a balance of approximately $2,500 at the end of
the year. Upon Llewellyn's question, it was clarified that there
is no on-going commitment to Tradec. Woods stated that although
EDC committed to the trade show at a significant level over a
period of several years, the same or any other level does not
have to be met. Banister felt that funds should not be earmarked
for the trade show. Houser stated that there may be other uses
for the funds. McFall pointed out that the relationship between
the Chamber of Commerce and Tradec has been severed. Woods said
that since Tradec is no longer involved, the money should be held
in abeyance and not be committed to anyone. LLEWELLYN MOVED that
the funds be kept and not be committed to Tradec for 1997.
Banister seconded and the motion carried.
Loan Application Process. Lubovich explained that there have
been some inquiries in the past few months regarding the issuing
of bonds for economic development. He noted that bonds have not
been issued for several years due to a change in the tax
benefits. He explained that benefits are no longer available for
warehousing, but are available for manufacturing and processing.
He said that a process should be in place in the event that there
• are further inquiries, and that bond counsel has reviewed the
existing forms. Lubovich and McFall explained the bonds, revenue
and benefits. Lubovich then distributed a summary of the
• process. He noted that these are non-recourse bonds, that the
City of Kent is not responsible or liable in any way under these
bond issues and that all administrative costs are reimbursed to
EDC. He reiterated that uses are limited to manufacturing and
processing. He explained that the applicant would complete an
application and pay a fee which in the past has been $1500. A
resolution of inducement would then be issued by EDC indicating
that they approve of the project, and bond counsel would
determine eligibility. The applicant would then make a request
from the Department of Trade and Economic Development for an
eligibility certificate and upon receipt, EDC would hold a
hearing and issue another resolution approving the issuance. It
would then go to the City Council for approval, after which a
date and time for closing would be scheduled. He noted that the
hearings could be consolidated.
Lubovich explained that Foster Pepper & Shefelman has been used
OF the
bond counsel in the past. He stated that EDC can establish
the annual compensation fee but that it cannot be higher than 1/8
of 1% of the outstanding amount. Upon Llewellyn's question,
Lubovich said there is a $10, 000, 000 limit, and that EDC is
basically a conduit for issuance. He added that the financial
package is in place before EDC is approached. McFall noted that
applicants could go through the King County EDC, but it still
must be approved by the Kent City Council.
LLEWELLYN MOVED to continue the program. Banister seconded and
the motion carried. BANISTER MOVED that the application fee be
kept at $1500. Llewellyn seconded and the motion carried.
LLEWELLYN MOVED to accept a form substantially similar to that
presented today. Banister seconded and the motion carried.
BANISTER MOVED that the annual fee be left at 1/8 of 1%.
Llewellyn seconded and the motion carried.
Lubovich stated that the paperwork will be completed, the fees
will be added, and the compensation agreement will be redrafted.
He will then ensure that it all complies with current law, and
will prepare an application packet.
Adjournment. There was no further business and the meeting
adjourned at 6: 05 p.m.
Brenda Jac ber
Secretary
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