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03-B PEDC (10/9/02)MINUTES OF THE PARIS ECONOMIC DEVELOPMENT CORPORATION REGULAR MEETING October 9, 2002 The Paris Economic Development Corporation met in a regular session on Wednesday, September 9, 2002, 4:00 P. M. at Paris Junior College, Applied Technology Building, Room 1016, 2400 Clarksville Street. President Jay Guest called the meeting to order with the following Directors present: Curtis Fendley, Don Wall, and Mike Dunn. Also present were ex-officio Board Members Bobby Walters, Executive Director Gary Vest, City Attorney Larry W. Schenk, and City Clerk Mattie Cunningham. President Guest called for the approval of the minutes from the meeting. A motion was made by Director Fendley, seconded by Director Wall, for approval of the minutes as presented. The motion carried unanimously. President Guest advised the Board Members that Mr. Anderson was not able to attend the meeting, but he had furnished a statement of the sales tax revenues for fiscal year 2001-2002. President Guest called for consideration of and possible action on a proposal from Cliff Parker for assistance from the PEDC in a manufacturing operation. Mr. Parker told the Board that they wanted to manufacture jewelry. He explained that importers are doing the bead work and the crimp work including a lot of different stones. This is a very simple form of manufacturing and they do some of it in their store. He wants to hire two full time jewelers to do this type of work in the back of his store. The stock will go out with a traveling sales representative who will sell to other businesses in the four-state area of Oklahoma, Arkansas, Louisiana, and Texas. Mr. Parker said he has been wholesaling jewelry to other businesses during most of this year. He started up basically for buying power. Mr. Parker told the Board that stonework has become really popular. PEDC Meeting October 9, 2002 Page 2 Mr. Parker advised the Board that the funding would be used to purchase gemstones, sterling silver spacers and all the materials that he uses to make and assemble jewelry. Mr. Parker advised he has a cargo trailer that he is customizing with shelving covering three walls with individual compartments for the jewelry. He said he has mass-produced jewelry that he buys and distributes, but there is only a 25% to 30% mark up for this type jewelry. Mr. Parker explained that if a person manufactures the jewelry, then he can keystone it, and it is a lot more impressive. He said what this would allow them to do, eventually, is, if they develop a large wholesale business, it will allow them to go ahead and get the casting equipment and everything they need to actually produce things by the hundreds and thousands when it comes to sterling silver charms and that type of thing where you already have a market established for the product. Mr. Parker said it was their plan to eventually have several full time jobs with jewelers that can manufacture the product in Paris. The Board discussed with Mr. Parker the process of keeping his retail operation separate from his manufacturing business. Mr. Vest explained that there has been Economic Development Corporations that have done retail projects, but the intent of the legislation was never to do retail projects. He said since some corporations have done that, our representative, Mark Homer, is going to introduce legislation to remove the retail from the Economic Development Corporations. He said that is why the Paris Economic Development Corporation is being careful and making sure there is a separation and they follow the intent of the law. President Guest said the PEDC is going to have to come up with the verbiage so that the PEDC stays consistent with the charter and with other people who might want money in this community. This is something that Mr. Vest, City Attorney Schenk, and the Board will have to work through. PEDC Meeting October 9, 2002 Page 3 Mr. Vest advised that he has talked with First Federal Community Bank, with whom Mr. Parker does business, and First Federal has financed him in the retail sector. Mr. Vest said he had spoken with people at First Federal and they did not have a problem with doing business with Mr. Parker, but he has over extended and they cannot, under their guidelines, loan him any more money even though he is a good customer. Mr. Vest advised that he asked First Federal if the PEDC gave a loan guarantee so they could finance him to continue this operation. Mr. Vest said all the PEDC would be doing is securing his note with First Federal so they will make the Loan. First Federal came back and wanted a 100% guarantee. Mr. Vest said in order for Mr. Parker to get started with this operation he would need about $40,000.00. President Guest said he had been told that the City of Paris has $200,000.00 in a cash account that has never been lent to any enterprise like this. Mr. Vest advised that he sent Mr. Parker to see Tommy Haynes with the City of Paris, and he met with Bob Jones. Mr. Jones rejected his request for a loan. President Guest said it his understanding that the money is going to be pulled by the USDA if the City does not do something, because they have not made a loan. Director Fendley asked why the PEDC doesn't administer that grant. Mr. Vest advised that this grant money has been contracted out to Mr. Bob Jones, and Mr. Jones administers the fund for the city. Mr. Vest said there are restrictions on it. It requires a bank participation like Mr. Parker is wanting for the $40,000.00. The bank would put up $20,000.00 and the loan fund would have to put up $20,000.00. After discussion, it was the consensus of the Board to invite Mr. Haynes to their next meeting and ask him to explain the USDA Grant and see if there is a way the PEDC could work with Mr. Jones in this effort. PEDC Meeting October 9, 2002 Page 4 Resolution No. 2002-006, supporting the Northeast Texas Regional Mobility Council (NETMOB) developing State Highway 24 from a two-lane roadway to a four-lane divided highway, thus closing the gap between Paris and Interstate 30 through Delta County, was presented. A motion was made by Director Wall, seconded by Director Fendley, for approval of the resolution. The motion carried unanimously. Mr. Vest explained that NETMOB is asking for support when they go before the Commission on October 31, 2002. NETMOB has asked for resolutions from the PEDC, the City of Paris, the Lamar County Chamber of Commerce, and Lamar County in support of making Highway 24 four lanes. He said there are sixteen miles of road through Delta County that are not four-lane. Mr. Vest told the Board that NETMOB is making an all out effort to try to get funding. He advised that they have already received federal funds from Max Sandlin designated toward the project, and he is continuing to work trying to get additional federal funds. They are trying to get the State of Texas to make a commitment to finish this project. A motion was made by Director Wall, seconded by Director Fendley, for approval of the resolution for the support of developing State Highway 24. The motion carried unanimously. Mr. Vest said it would be a help if anyone could go to Austin to support NETMOB. Mr. Wall advised that the Texas Department of Transportation said this is their best shot in getting the funding to complete this project. If NETMOB does not receive the funding, it will be six years before they will get another shot at it. He said they were asking for twenty-one million dollars. PEDC Meeting October 9, 2002 Page 5 Mr. Vest explained that the local group has to buy the right-of-way or has to pay a part of the acquisition of the right-of-way. Delta County is unable to come up with their share of the funding. Mr. Wall stressed the need to have a large contingency in Austin as the Commission members count heads in support of projects. They know how far you drive and they have to have total community support from the four counties that are backing this project. President Guest called for the Director's Report. Mr. Vest said since the last meeting, there have been ten inquiries to the advertisement program. Two proposals have been submitted for food processing through the Texas Department of Economic Development. Mr. Vest advised that Eric has submitted a proposal on the Oliver Rubber building from a prospect that came from the Texas Department of Economic Development. Mr. Vest said on September 3, 2002, they had a rather large Fortune 500 Company looking at a site just north of Kimberly Clark. He said this project, which is highly confidential, is call Project Winner and it came through the Texas Department of Economic Development. Mr. Vest advised that they would need a million square feet of building, and it would create several hundred jobs. Mr. Vest will furnish additional information to this company. He is going to put PEDC's proposal showing incentives in writing during the next few weeks. Mr. Vest advised that he met with Senator Ratliff on August 30, 2002, about some of the legislation coming down, and he assured him that if Mark Homer can get his legislation through the House, he will push it through the Senate. Mr. Vest said he has been concerned about a lot of the bills that are being PEDC Meeting October 9, 2002 Page 6 proposed to do away with the Economic Development sales tax and Senator Ratliff is going to really keep a watch on that. Mr. Vest said he met with Ralph Beal and Bill Dickey about the medical development north of Paris. Mr. Beal had asked about the PEDC doing the infrastructure. Mr. Vest had explained the AG's opinion which had said that Sweetwater, Texas, could not assist with a medical facility. Mr. Vest and Eric attended the annual Texas Economic Development Council meeting in San Antonio the week of September 23-27th. He had given an hour and one-half presentation during the event. During the same week, Mr. Vest met with the Texas Commission on Environmental Quality (TCEQ) which was formally known as the TNRCC. On Friday he had met the new commissioner, Cathleen Wyatt. Mr. Vest advised that if the city get the new industry, Project Winner, permitting is going to be a big item which means that he and Eric will be dealing with TCEQ. Mr. Vest mentioned the fact that when the staff moves to the Depot, there is going to be a need to extend the fiber optic from the Paris Police Department to the Depot in order to run their computer systems. He said the Chamber of Commerce does not have the two to three thousand dollars to do the work. After discussion, it was the consensus of the Board to continue with the extension of the fiber optic and bring it back to the Board for approval. Mr. Vest reported that the City of Paris had received a TIFF Grant. This grant will provide for the installation of four computers at the Depot. These computers will be for the public who will be able to pay their water bills, access the city council agenda, and visit the web sites for the Chamber of Commerce, City of Paris, Paris Junior College and the PEDC. All the Chamber has to provide is the fiber optic cable to the Depot. Mr. Vest passed out a brochure on Cox Field Airport. PEDC Meeting October 9, 2002 Page 7 Director Wall stated that he has been elected as the Chairman of the Chamber of Commerce and the Chairman of the Chamber of Commerce is an ex-officio of this Board, and asked if former Chamber Chairman Mike Graxiola could continue as an ex-officio member. City Attorney Schenk advised that he was not sure about this, but he would check into this and report back to the Board. There being no further business, the meeting was adjourned. JAY GUEST, PRESIDENT ATTEST: MATTIE CUNNINGHAM, CITY CLERK