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1994-02-24-PEDC13 MINUTES OF THE PARIS ECONOMIC DEVELOPMENT CORPOHATION February 24, 1994 The Paris Economic Development Corporation met in a regular meeting on Thursday, February 24, 1994, 4:00 P.M., City Hall, City Council Chambers, Paris, Texas. Chairman Philip R. Cecil called the meeting to order with the following board members present: Eric Clifford, Curtis Fendley, Barney Bray, III. Also present were ex-officio board members, Jo Ann Parkman, Gary Ownings (representing Gary Cunningham) Michael E. Malone, City Manager,and T. K. Haynes, City Attorney, as counselor. Chairman Philip Cecil stated the first item on the agenda was the administering of the oath of office for the Ex-Officio "Members" not previously sworn, and City Attorney T. K. Haynes advised there was none present at this time. Chairman Cecil stated that the next item on the agenda was approval of the minutes from the previous meeting of the Paris Economic Development Corporation. Chairman Cecil asked if there were any corrections to the minutes of the previous meetings, there being none, Board member Eric Clifford made a motion, seconded by Board member Barney Bray, to approve the minutes as presented, and the motion was approved unanimously. Chairman Cecil stated that the next item on the agenda was the financial report, and he asked City Manager Malone if he would like to expand on this report. Mr. Malone introduced Gene Anderson, Finance Director, who stated that the report summarized the revenues for the months of October, November and December. He stated that the state collects a two percent fee, and keeps it for processing all the paperwork related to the tax as well as an additional amount for adjustments due to errors that might occur in reporting. Mr. Anderson advised that if there are no errors then they add this amount back to the next months check. He said the amount located in the last column is usually the payment amount the City receives. Mr. Anderson said the actual amount paid to the City for October, November and December is $192,221.21. Board member Eric Clifford wanted to know if the money was in an interest bearing account, and Mr. Anderson said it is currently in the consolidated account with the other multiple City funds collected and draws interest. Mr. Anderson said in the future when the Board will be expending funds, then it will be put in a separate interest bearing account which will require board members signatures on checks. Mr. Cecil stated that one of the principal reasons for the board meeting this afternoon was to hear from the consultants asked to make proposals to assist in the preparation of a strategic plan for the economic development of Paris, Texas. He stated that the Board had received proposals from the Cornerstone Group, Day and Associates, and the Pace Group. He noted that Day and Associates were represented at the meeting. Mr. Cecil said he had heard from Mr. Shelton of the Cornerstone Group, and a prior commitment had prevented him from being present at this meeting. Chairman Cecil said Mr. Shelton had asked if there were any questions in connection with his .proposal, and he advised him no there no questions. Mr. Cecil said the same thing was true regarding the representative of the Pace Group. Board member Eric Clifford made a motion, seconded by Board member Curtis Fendley, to receive proposals from consultants to assist in the preparation of a strategic plan for the economic development of Paris, Texas which carried 4 ayes, and 0 nays. 14 At this time, Chairman Cecil asked for Ms. Day and Mr. Pothoff, of Day and Associates to make their presentation. Ms. Day said they have pulled together a uniquely qualified team to perform the tasks as outlined in the Council's Charge and they have a very good understanding of the community and the issues facing the community. She stated they have asked the Center for Economic Development at the University of North Texas to be a member of their team. One advantage to the Center is that they are a not-for-profit organization, and the fees they have are less than in most of the marketplace and will be passed on to you. They have been involved with numerous cities doing the same type research. Mr. Pothoff stated they had tried to keep the approach to this project and to the Council Charge as simple as they possibly could and as well as cost effective. He stated that in the Council Charge the Strategic Plan is divided into three primary phases and the fourth phase being implementation which is an ongoing phase. Mr. Pothoff discussed the various phases briefly with the Board and stated the Board will constantly be faced with addressing inquiries made by prospects which will continue during the Strategic Planning Process. He said there are basically two methods to handle this problem. One way would be not to take any actions other than business retention until after the Plan is finished, and let your fund build until you know clearly what you want and how you want to do it. Another option would be to develop an interim set of project criteria and incentive packages you could use to address projects that are going on in the interim. At a later date after the goals have been developed, then you can take a permanent direction, and if needed, make the adjustment to match what you have determined is the direction you really want to go. Mr. Pothoff stated that they had designed each task to be accomplished in a way that it builds on itself. He stated their fee for accomplishing this is less than ten percent (10%) of the first year's sales tax revenue. They believe with public money a general rule of fund used for grant work and planning you don't want to spend more than ten percent. Board member Curtis Fendley questioned on page 21 of the proposal regarding estimated expenses. He wanted to know if this was in addition to the total fee. Mr. Pothoff said, yes the $3,000.00 in expenses is in addition to the $54,500.00. Also, Mr. Pothoff stated in Task Group 6 of the Marketing Plan the amount should be $6,000.00, but the total of $23,000.00 is correct. Mr. Cecil asked Mr. Pothoff if each one of the phases is dependent upon the other,or if the Board could pick and chose what they wanted you to do. Mr. Pothoff said they could do Phase I, without a problem, but if the Board said do this part out of Phase III there would be a problem because the prices depended on developing some of the base information to get there in Phase I and Phase II. Mr. Cecil asked Mr. Pothoff if the Board asked them to do Phase II, the Project Approval Criteria and Incentive Package out of Phase III if that something that could be done. Mr. Pothoff said it could be done, but they would probably want to look at the numbers a little more closely. In other words, Mr. Cecil said these numbers would not hold up on that kind or proposal? Mr. Pothoff said no because some of the work that would have to be done to prepare for them would not have been accomplished. 15 Mr. Bray asked what if you were to do Phase I, part of Phase II or part of Phase III? Mr. Pothoff said if we are going in sequence, then it doesn't represent as much of a problem. Ms. Day stated another reason they would have to reconsider is because North Texas gave them a fee for doing all three studies. Ms. Day said they could do Phase I because it is really the beginning the foundation. Mr. Cecil said that if the Board asked them to do Phase I, or Phase I and Phase II, short of the total project; and the Project Approval Criteria and Incentive Package out of Phase III, could this be done? Ms. Day said basically those numbers for what you just said would stand alone. Now if you said it differently, they might not. What you just said pulls in everything North Texas is going to do, their numbers are going to stand. Mr. Pothoff stated he would not recommend the parameters be done without getting some type of community input and getting a shared vision established with some goals. Mr. Cecil asked for other questions, the members might have and there being none he thanked them for their presentation. Mr. Cecil stated that he wanted to bring the other board members up-to-date in connection with the telephone conversations in connection with the other two proposals. He said Mr. Shelton of the Cornerstone Group advised in his proposal he does not feel comfortable in breaking down the basic package. Mr. Cecil said in talking with the Pace Group he understood you could cherry pick any part of it. City Manager Malone pointed out the Pace Group also had an alternative plan in their RFP. Mr. Cecil pointed out on page 16 you could elect any task you wanted to and Mr. Malone agreed. Mr. Cecil stated that he feels the first thing to decide is how much the Board wants the consultant to do. After we make that decision then we can decide which is the best deal for the Board to select. After discussion, it was the consensus of Board to get the program approval parameters drawn. Mr. Cecil pointed out that in Phase III there are some items that really don't need to done now, for example the Marketing Plan is premature as well as some of the other things. He stated you almost have to do Phase I to be able to build on the other two phases. Board member Curtis Fendley stated that he felt it depended on how extensive Phase I was. Some of the business retention has already been done at the Chamber in a survey last Summer. Mr. Fendley said the Chamber may already have some information that can be used Chairman Philip Cecil asked Ms. Day and Mr. Pothoff if they were asked to do Phase I at the price of $22,000.00 the Board assumes you are going to have to dig out all this information yourself or have it done. Ms. Day agreed. Mr. Pothoff said regarding the business retention and expansion survey, he would have to take a look at specifically what the Chamber did and if there is something useful in the survey they could make an adjustment. Chairman Cecil asked for the Board's thoughts on how much of this needs to be done. The consensus of the Board was they must have the Incentive Plan in Phase III. Mr. Cecil asked Mr. Pothoff if they elected to use their proposal Phase I, Phase II, the Incentive Package alternative and the Project Approval Criteria in Phase III would we be doing is paying $22,000., plus $9,500. plus $10,000. Ms. Day and Mr. Pothoff agreed. Board member Leon Williams entered the meeting at this point. Mr. Pothoff also advised that he assumed that you would also want it to be put into a Strategic Plan document with action stubs to have a Strategic Plan. He stated you have products that come out of Phase I and Phase II and Task VII and the Strategic Plan is more than just a collection of the products. You must also have some kind of assignment of particular steps that must taken as to what is to be done. Mr. Cecil asked if the only thing they would be leaving out would be the Marketing Package under what you are saying, and Mr. Pothoff agreed. Ms. Day stated they would do Phase I, Phase II and pull the parameters from Phase III as it is outlined here. At that point if there are other things once that is done that you want done then we can talk about it then. It would give you your set of goals and objectives, but it would not come out in a document that is as such a Strategic Plan. At that point it may be you may make the decision there are other things you can do on your own which you have the opportunity to make that decision. Mr. Cecil asked Ms. Day if it was true that you could not do Phase II without having done Phase I and she agreed that in their opinion that is correct. Mr. Cecil stated to clarify for the Board your fee for Phase I and Phase II would be $22,000 plus $9,500 and $10,000 to do the parameters in Phase III and she said that was correct. Mr. Cecil stated the Board cannot get a comparative with the Cornerstone presentation because they are not willing to do that, and Pace is willing to do that. Board member Barney Bray said in the Pace bid the expenses would be on top of the $85,000. fee and that's an open ended kind of deal with their numbers. Mr. Bray questioned as to what their expenses would be. Mr. Cecil said they had noted that they would hold their expenses to a minimum. Mr. Cecil said on page 19 of the alternative proposal the Flexible Incentive Program would be $14,500., the business retention program which equates to Phase I, $14,500., and the vision and economic summit equates to part of Phase II would be $7,500. and they could eliminate the marketing plan and the volunteer training. To make this proposal comparable you would be down to $14,500, $14,500 and $7,500. Ms. Day and Mr. Pothoff said these were not exactly apples-to-apples. After discussion the Board members stated they realized that they needed to do something as quick as possible, but felt they needed to review further. Mr. Cecil stated it was the consensus of the Board that they needed to get the parameters drawn for approving the projects first and beyond that he felt they need to get a minimum amount done at this point. Mr. Cecil said his initial thoughts were to do Phase II get goals and priorities set and get the parameters drawn and then do the additional information later. Mr. Cecil stated that Mr. Pothoff did not feel comfortable in doing just Phase II. Board member Fendley asked what if we did Phase I, Task I and the Vision and incentive Package? Mr. Pothoff noted that when you go to do your incentive package eventually what you want to end up with is a set of threshold requirements with a point system and that reflects where you want to go. Chairman Cecil stated the Board could either put the proposals aside and study them some more, or the Board could move ahead and try to make a decision. He stated he felt there were some questions in everybody's mind about how much to cover here, and in order to be fair to everybody we must compare apples-to-apples. 17 Mr. Bray stated the Cornerstone group didn't want to do any of it if they didn't do it all, so he felt there wasn't really any point in considering them further if the Board is not going to do the thing as a whole. He stated if this was the fact then the Board should consider only the two other proposals. Mr. Bray stated it might be in order to be sure that the same items are compared, and Pace needs to identify exactly what is included in their alternate proposal. Mr. Cecil said if he could interpret for Dr. Lovorn in this alternate proposal. Dr. Lovorn does not feel at this point all these things they are asked to bid on are needed. Mr. Haynes asked if Dr. Lovorn felt that everything that was needed was in the alternate bid. Mr. Cecil stated no necessarily, for example the marketing plan which the Board knows they are not going to do now and the volunteer training. Mr. Haynes advised there is going to have to be some training. Mr. Cecil agreed at some point there would have to be some training, and it was a matter of timing as to what needs to be done now and what is needed to satisfy the City Council in their Charge and Strategic Plan. Mr. Cecil stated that in view of the time constraints as it relates to Project Approval Criteria that if we want to study it further we will have to have a special called meeting in order to proceed. Mr. Bray stated he wanted to be fair with the Pace Group and he would like to know what he is going to include in these numbers. Mr. Fendley asked Mr. Cecil to call Dr. Lovorn back and see if he can come. Mr. Bray said if he could send the Board a list of criteria that's going be included in these numbers and sign off on it. Mr. Bray said if Dr. Lovorn wanted to send a fax that would be fine just so he could get a better understanding of what's included in these figures. Mr. Cecil stated that it was the consensus of the board to table this item pending their conversation with the Pace Group and he felt that they knew everything they needed to know from Day and Associates and if we don't we need to get that off the table right now. Mr. Cecil stated they would talk to Dr. Lovorn and recess the meeting until Thursday, March 3, 1994 at 4:00 P.M., and the board will take appropriate action at that time. In the meantime, we will talk with Dr. Lovorn of the Pace Group and get further clarification on his proposal. Mr. Cecil asked if there was anything else to come before the Board at this time. Mr. Haynes stated that he would suggest that item number 6 on the agenda be removed in order that everyone will know there is not going to be an executive session at the next meeting. Mr. Cecil stated that they had indicated that there was not going to be an executive session. Board member Curtis Fendley made a motion seconded by Board member Eric Clifford, that agenda item number 6 executive session be removed which carried unanimously. City Attorney T. K. Haynes stated under the Open Government Ethics there is a statement information is excepted from the requirement of Section 552.021 if it is information that if released would give advantage to a competitor or bidder. Chairman Cecil asked if there was any other business and there being none he declared the board meeting recessed until next Thursday, March 3, 1994 at 4:00 P.M. CHAIRMAN PHILIP R. CECIL ATTEST: ASSISTANT CITY CLERK, BARBARA DENNY