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HomeMy WebLinkAboutCity Council Committees - Economic Development Corporation - 06/06/1985 (3) CITY OF KENT ECONOMIC DEVELOPMENT CORPORATION June 6, 1985 The regular meeting of the City of Kent Economic Development Corporation was called to order at 7:50 a.m. by Chairman of the Board, Tim Leahy. Present: BOARD MEMBERS: Tim Leahy, Chairman Tom Bailey Leo Powers OFFICERS: Marie Jensen, Secretary of the Board CITY OFFICIALS: Dick Cushing, City Administrator ALSO PRESENT: Mike Webby, Personnel Director George Kovats, Meteor Communications Mark Singer, First Western P. Stephen DiJulio, General Counsel LIABILITY INSURANCE Mike Webby explained that the liability insurance for the corporation had been . placed in the amount of $1 million. He noted that the insurance was placed on a "claims made" basis rather than on an "occurrence" basis which means that liability insurance must be in place at the time the claim is submitted regardless of the date of occurrence. He noted that the insurance must therefore be kept in place through the statute of limitations even if the corporation is no longer in existence. CASCADE DEVELOPMENT DiJulio noted that the bonds for Cascade Development in the amount of $3.75 million had closed on April 30, 1985. NORTHWEST ALUMINUM PRODUCTS DiJulio noted that this $,2.3 million bond issue continues to be delayed and a closing date has not been set. He noted that industrial revenue bond issues must be closed within 60 days of the passage of the Council 's bond resolution • (April 22, 1985). He pointed out that the process would have to start over if the 60 day deadline was not met. BROTHERTON/PLEAS DiJulio reported that the bond issue for Brotherton/Pleas in the amount of $1 million had closed on May 10, 1985 and was sold to an individual investor. PLEMMONS DiJulio reported that there has been no further action on the Plemmons applications. DiJulio noted that the President's tax proposal may have a significant impact on this Board and may mean that it would meet only yearly to review revenue. MINUTES Leahy moved to approve the minutes of May 2, 1985 meeting. Powers seconded, and the motion carried. BOND COUNSEL DiJulio distributed copies of a letter from Preston, Thorgrimson, Ellis and Holman of Seattle, dated December 4, 1984 as well as a letter from the Department of Commerce and Economic Development listing the qualified bond counsel firms in Washington. A letter from George Kovats was also distributed noting that his client was considering applying for industrial revenue bonds to buy land and to construct a larger facility in Kent and especially requesting direction on this corporation's policy in selecting bond counsel since his client preferred to work with the Perkins/Coie firm. DiJulio stated that this corporation has a policy to use the firm of Roberts and Shefelman exclusively. He explained that several law firms could be involved in an application for industrial revenue bonds such as an attorney representing the applicant, one for the trustee, and the bond counsel for the corporation. He recommended that this corporation continue to use Roberts and Shefelman noting that they have represented the City for years, and we are comfortable working • with them. He recommended that if an applicant could show that they have worked with another bond counsel firm on a related project and could show good - 2 - cause for utilizing an additional bond counsel , the Board should be willing to consider this situation on a case-by-case basis. He noted that if the Board elected to permit use of a bond counsel other than Roberts and Shefelman, we should advise the applicant that the Board would continue to use Roberts and Shefelman for document review and in an advisory capacity. He pointed out that this might result in additional expense for the applicant. He stated that if the Board approved his recommendation, he would prepare a resolution to amend the corporation policy in this matter. George Kovats noted that his client had worked with the Perkins/Coie firm. DiJulio explained that the bond opinion is given to the Corporation and therefore the bond counsel selected by the applicant would become the Corporation's bond counsel also for this particular issue. He clarified for Powers that using Roberts and Shefelman to review the documents may result in some extra cost for the applicant and noted that Roberts and Shefelman would, under these circumstances, not be giving the bond opinion. They would in this kind of situation be advising DiJulio, the Corporation General Counsel . He • noted that this type of application may increase his charges as he would have to work with Roberts and Shefelman and with the applicant's bond counsel . He clarified that industrial revenue bonds are very different from municipal bonds and noted that the Corporation is comfortable with Roberts and Shefelman and has not done business with Perkins/Coie. It was noted that two bond counsel firms had been used in an Eastern Washington port issue. It was determined that Kovats would meet with Perkins/Coie and Roberts and Shefelman representatives to discuss the matter and to determine what the extra cost might be and that DiJulio would draft a resolution stating that the Board will consider allowing the use of bond counsel other than Roberts and Shefelman on a case-by-case basis, with the Board reserving the right to continue to utilize Roberts and Shefelman. The applicant will be responsible for any extra charges involved. Kovats stated that the proposal for industrial revenue bonds would be about $6 million for Meteor Communications Corporation noting that the company is growing. The company had approximately $4.8 million in revenue last year, anticipated $10 - $15 million next year, and $25 - $30 million in the - 3 - following year. He noted that an appropriate building was needed and that currently 22,000 square feet was being used in three different buildings at South 224th and 72nd Avenue South. A joint venture with Northwest Properties is proposed to relocate the business to Uplands Industrial Park at the Green River Oxbow, consisting of 70,000 to 75,000 square feet. Kovats stated that he hoped to be ready for the Board's inducement resolution before the second week in July. DiJulio noted therefore that he would keep in touch and set up the necessary special Board meeting. Leahy pointed out that he favored 6:30 p.m. meetings on Monday evenings immediately prior to City Council or Council Workshop meetings. Bailey noted that in spite of the fact that this corporation could be eliminated, the Board should be looking ahead to develop an Economic Development Policy, and he suggested that Cushing present some ideas on this subject at the next meeting. The meeting was adjourned at 8:45 a.m. and no date was set for the next • meeting. MARI E J ENS , City Cl rk Secretary of the Board 0024C-IC - 4 -