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HomeMy WebLinkAboutCity Council Committees - Economic Development Corporation - 11/16/1992 ECONOMIC DEVELOPMENT CORPORATION November 16, 1992 A special meeting of the Kent Economic Development Corporation was called to order at 4:30 p.m. by Chairman White at Kent City Hall . Present: Boardmembers White, Banister, Llewellyn and Johnson Officers: Assistant City Attorney Brubaker, Treasurer McCarthy, Secretary Jacober Others: Raul Ramos, Vern Dwight, Barbara Simpson, Bill Dolittle APPROVAL OF MINUTES Llewellyn moved that the minutes of the September 22, 1992 meeting stand approved. Banister seconded and the motion carried. DOWNTOWN INFRASTRUCTURE Chairman White explained that EDC has approved funding for a Downtown Infrastructure Study, but not for a facilities coordinator. He explained that Mr. Ramos has a contract with the City of Kent, but that EDC is a separate corporation. Ramos noted that the request for proposals listed several tasks, which he has worked on, and that his Economic Development Strategy Report includes the infrastructure facility component and recommendations on how to improve downtown. He explained that it is a series of programs and actions by local government, or in cooperation with the private sector, such as the Chamber of Commerce. He noted that he has done a survey on sidewalk repair and replacement, noting that street trees are a problem from a liability standpoint as well as infrastructure standpoint. He noted that the water system has some long term potential inadequacies, and that he is working with Don Wickstrom on water priorities. He added that he has studied parking garages and that $75,000 was intended for design use and for exploring the possibility of joint use with King County, Metro, or Burlington Northern. He said that he has been working with a developer who is interested in building 120 senior housing units downtown, but that there are storm drainage concerns. Upon White's question, Ramos noted that the Infrastructure Study is done and he is now working on implementation. White noted again that EDC funded a study, and that although the Mayor chose to sign a contract with Ramos for something other than that, EDC must protect their funds. Ramos said he feels the Infrastructure Facilities Program includes the study and implementation. Johnson suggested that funding for implementation would be more appropriate coming from the City than from EDC. Upon questions, White explained that EDC is a mechanism whereby loans are guaranteed for economic development and an override from those loans funds the organization. Brubaker added that the funds must go back to the City for economic development and use in the community. White noted that there are strict guidelines and that some benefit must be received. He explained that he is trying to protect EDC funding; he is not trying to stop Ramos. He said that the portion funded by EDC is complete and that funding should now come from other sources. Johnson opined that the funds should come from the City rather than EDC, since EDC does not have a contract. Llewellyn stated that it would be short-sighted not to 1 p assure some type of implementation; Banister agreed. White noted that he is not opposed to that, but that the EDC directors will be held responsible if money is spent in a way that is not covered. Upon Johnson's question, Brubaker said that the implementation plan could either be funded by EDC from excess interest funds or by the City. Ramos noted that there are two elements to implement -- the Downtown Infrastructure Facilities Plan and the Economic Development Strategy Action Plan. Johnson moved that Phase I be accepted as complete and that Phase II be funded by the City. McCarthy noted that EDC had $21,000 left at the end of September. He said that it is important to keep Ramos on board since he has worked with banks and people in various developments about downtown revitalization. He added that money has long been budgeted for sidewalk improvements and that there is now a plan for it. Ramos pointed out that some of his invoices have been paid from water and sewer funds, since the work was directly related to that. Brubaker explained that a vote could be taken as to whether to use the remainder of the money for a second step or whether to terminate funding since the need has been fulfilled. Johnson reiterated that funds are available as far as the City is concerned and that the projects will not be dropped. Upon questions from White and McCarthy regarding the second phase, Ramos explained that what the City would receive could be a series of documents, an interim parking agreement with Metro, or actual site plans. He noted that he would be working with the Public Works staff to set up the program; White questioned why a consultant would be needed. Ramos responded that the Public Works staff may be working on other priorities and downtown may be put on the �`• back burner. McCarthy clarified that Ramos was to coordinate the financial aspects and come up with ways to fund various projects; Ramos noted that that is the Community Investment Plan, which is separate. Johnson reiterated that what EDC requested has been received, and that the remainder should be done through the City. Brubaker stated that EDC funding can be stopped at this point and that Ramos can be further funded through the City, and added that the scope of work can be amended. White stated that it is not his purpose to stop Ramos, but that he prefers to use EDC funds as seed money, and that the $21,000 remaining could be used to fund another project in the future. Llewellyn then seconded Johnson's motion and it carried. REVIEW OF INTERNATIONAL TRADE PROGRAM CONTRACT White explained that this item was added to the agenda so that any questions or concerns can be addressed. Brubaker distributed copies of the draft contract and resolution and noted that it is patterned after a commitment of funds from the City of Yakima for their international trade fair. He noted that General Counsel Lubovich feels comfortable with the documents and noted that he and McCarthy have altered the payment schedule. He noted that the Chamber had originally requested more money earlier on, but that Lubovich had set the schedule up for $5,000 on January 2, 1993, and $15,000 per quarter thereafter, and made it contingent upon receiving matching funds. Vern Dwight said their initial request was for larger funding in the beginning, then tapering off during the remainder of the contract, and added that a disbursement schedule was submitted. Upon Johnson's request, McCarthy noted that as of the end of September, there was $84,200 in the budget, and that there would be $32,000 at the end of 1993, 2 assuming that the $50,000 being discussed is spent. He added that if the funds remaining from the Downtown Infrastructure Study are not spent, there would be approximately $45,000 at the end of 1993. He explained that the City cannot pay out without receiving some sort of product. Dwight said it was his understanding that the funds would be used as seed money, and added that they incur a lot of expenses up front in relation to putting on the trade show. He said costs are incurred through foreign buyer recruitment, which means trips to foreign countries, and explained that it will cost from $20,000 to $25,000 in November and December. He said they will have cost breakdowns and expense reports to support their expenses, and that the product will be in the form of the trade show to be held in August. McCarthy questioned whether travel receipts would be considered a product. Brubaker explained that economic development corporations must fund something physical . He noted that the EDC can take their interest income and give it to the City to use as they wish, which is what they are doing in this case. He stressed that the safest way is to get something in return for their money. Barbara Simpson said that it is a normal course of business to fund for hours accounted for on a project, and clarified for Llewellyn that the payment schedule in the contract was drafted by McCarthy and Lubovich. Brubaker explained that the original schedule asked for $3,000 on November 1, 1992, $31,000 on December 1, 1992, and $16,000 on February 1, 1993. Simpson said the proposal was initially accepted as seed money towards a program that will be occurring throughout the year, and that backing out the bulk of the funds until the last quarter makes it difficult to implement the program. She said she had understood Lubovich to say that if this is tied to a product, other citizens may question the amount paid for it. She added that Boeing and Keybank are also providing funding. Llewellyn noted that EDC has made a commitment and should look to Tradec and the Chamber to do a reasonable job with the funds. McCarthy suggested using the private sector funds up front and the City's funds at the end of the project. Dwight noted that everything will be starting soon, and that there is not enough money from the private sector to pay all the up front costs. He added that the City is the leader, and has the biggest investment. He also pointed out that the private sector wants to know that there are matching funds from the City involved. He explained that there will be an advisory board to review the expenses and costs, and that someone from the City will be on the board. White suggested that Dwight, Simpson, and McCarthy meet with Lubovich on Tuesday, November 17, to work this out. He explained that this requires Council action and it is not on the agenda for November 17; therefore it would be two weeks before funds are available. He said he is agreeable to whatever the City Attorney works out, noting that EDC has already approved it. He added that the payment schedule offered by the Chamber is acceptable. He also said that he will leave getting this item on the November 17 agenda up to McCarthy and the Council President. Dwight pointed out that the Chamber is going to apply as a foreign trade zone and do a resource guide, as well as the sister cities program, and that he would be more comfortable if that were all in the contract. The meetingthen adjourned at 6:00 .m. P Q 3 Brenda Jacober( ' I ,Secretary of the._Bbard