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4A Wichita Falls Economic Development Minutes - 04/19/2018MINUTES OF THE WICHITA FALLS ECONOMIC DEVELOPMENT CORPORATION April 19,2018 PRESENT: Dick Bundy, President § WF1,11)(" Members Reno Gustafson, Vice I)residei,it/Secretary-'I'i-easurer § Darron Leiker § David Toogood § Jim Dockery, Deputy City Manager/CFO § City Staff R. Kinley I-legglund, Jr., City Attorney § Linda Merrill, Recording Secretary § I lenry Florsheim, CE10 § Kevin Pearson, V.P.,f.`conomic Development § Travis I laggard, V.P., BR&I" § Adrene Wike, Research Associate § Brian Havins, Marketing § Sarah Flarpole, Administrative Assistant § Jcff Mitchell, Plant Leader § Owens Corning Julie Miller, Vice President § Jones I,ang LaSalle Barry Hardin, Director oil' Operations, North America § Scaled Air Kyle Tevlin, Plant Manager § Fred Schrock, Plant Manager § Ron Duncan, President § MagicAire Katyra Guillaume, Reporter § KI'DXTV 3 ABSENT: I....eo Lane § Member 1. Call to Order Dick Bundy called the meeting to order at 3:35 p.m. 2. Financial Report Jim Dockery said five months of sales tax revenues have been received, at a total of $1.56 million. Currently at a pace of3.73%, the fund would end the year at $3.874 million if this growth continues through the remaining seven months. The last month's receipts were the first negative receipts. Revenues also include $1.5 million as reimbursement from the DEEA(J grant. Mr. Dockery reminded the Board it budgeted $3 million for the Sheppard AFB gate project; $1.5 million will be reimbursed from DF'F"AG. The contract for the Df."I.."AG funds is about to be signed, and the City is working with the Base and its contractor to get performance arrangements made. He will close out the two Eagle Rail projects, as they are completed. Since the last meeting, he has closed the Amfuel and Safety Design projects and relinquished those funds. Chantex was also completed and moved out of open projects. The Vitro Supercoater project is in progress; the WFEDC will pay $2.7 million and BurkbUrnett will pay $300,000. The Board has $4.9 million with which to authorize expenditures at present. Mr. Gustafson asked the status of the additional parking for the hotel. Mr. Dockery said the 4B Board paid for the design. They will not bid the project until Gatehouse Capital has secured a private loan for its share of the hotel. Mr. Leiker added that the construction would not begin until after this year's Ranch Roundup and Hottern Hell events. Mr. Gustafson asked if the bid will be for concrete or asphalt. Mr. Leiker said it will be bid as an alternate. Mr. Dockery said an extra cost involved is keeping the RV connections. 3. Approval of Minutes (2/6/18) Reno Gustafson moved for approval of the minutes. Seconded by David Toogood, the motion carried 4-0. 4. Discussion and possible amendment of Owens Corning agreement I lenry Florsheim said the performance agreement with Owens Corning had not yet been finished. Julie Miller of Jones Lang LaSalle was here to address certain changes contemplated by the company. Owens Corning has been relocating machinery and equipment from Brunswick into Wichita Falls in order to bring the total number of jobs here to 90. Its initial intent was to purchase the FedEx building across the street, and construct a large addition on the back. They have instead looked at different options and are delaying that. Part of the agreement with the WFEDC required completion of that by the end of" 2019. At this point, they have hired 62 employees and are on track to meet this requirement by the end of the year. They now request that the incentive agreement remain essentially intact, but without the requirement of the capital investment component. Jeff Mitchell said they are storing raw materials at the FedEx building. Ms. Mitchell added that they have signed a three-year lease on that building, with an option to purchase. Mr. Florsheim reminded the WFEDC that Owens Corning was also originally going to buy the City -owned land at the corner of Sheppard Access Road and Randy Road. S. Discussion and possible approval of incentives for Sealed Air/Cryovac Kevin Pearson has been working on this project for the past 1.5 years with Barry Hardin, Operations Director for North America and Fred Schrock, Iowa Park Plant Manager. Mr. Hardin passed out information explaining that Sealed Air/Cryovac is a global plastics packaging company for food and products. The two companies in North Texas are involved in food care, and produce $1.4 billion in revenue annually for the company. They are going to add a poultry film line to the plant in Iowa Park in early 2020 at a cost of $20 million. The company is seeking a $1.25 million investment from the WFEDC for the Wichita Falls plant in the form of equipment: an uninterrUptible power supply, as they have had issues with power interruptions which leads to downtime; and a vision system, which would confirm that the print quality is acceptable. Mr. Pearson said Mr. Hardin told him that when Corporate was considering placing the Poultry line in North Texas, the real draw was that the WFEDC would invest in the plant north of 1-44. Without those incentives, the line most likely would have gone to Simpsonville. Mr. Hardin said the investment from the WFEDC is certainly a significant piece of the proposal. It reduces the amount of necessary investment from Corporate. Mr. Pearson added that the company is investing in a new roof and making parking lot improvements. Mr. Hardin said they always have capital improvement dollars going toward facility upgrades. 6. Discussion and possible approval of incentives for MagicAire Travis Haggard introduced Ron Duncan of MagicAire. He and a team purchased the company from United Electric in 2010. Mr. Duncan has served as General Manager since 2004. Mr. Duncan said MagicAire builds air conditioning equipment mostly for commercial applications. They have 100 regular employees, 40 salaried, and 20 engineers. They have Midwestern State University interns year-round. 1-le is here today to discuss an expansion opportunity with one of its customers, Carrier. Their request would increase employment by 20 jobs over three years (six in year one, and seven each in years two and three), and they are seeking a $1.35 million investment from the WFEDC over two fiscal years. They need equipment to create manifold tubes that have a 3D curve. In addition, they need to produce coil lengths up to 12 feet. Finally, an existing customer has required that they furnish individual, reusable crating. 7. Executive Session Mr. Bundy adjourned the meeting into executive session at 4:22 p.m. pursuant to Texas Government Code §551.08 7. He announced the meeting back into regular session at 5:35 p.m. The subijects posted in the Notice of Meeting were deliberated, and no votes or further action was taken on these items in executive session. 8. Motions Owens Corning — No motion was made. Sealed Air/Cryovac — Mr. Leiker moved that the Board approve a $1.25 million seven- year forpivable loan to Sealed Air/Cryovac's Wichita Falls plant. Seconded by Mr. Toogood, the motion carried 4-0. MagicAire — No motion was made. 9. Adjourn The meeting adjourned at 5:38 p.m.