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4B Sales Tax Corporation Minutes - 10/30/2019MINUTES OF THE WICHITA FALLS 4B SALES TAX CORPORATION (4BSTC) October 30, 2019 PRESENT: Glenn Barham, Vice President Rick Hatcher, Secretary -Treasurer Dave Clark Darron Leiker Nick Schreiber Stephen Santellana, Mayor Bobby Whiteley, Councilor at Large Jeff Browning, Councilor, District 3 Paul Menzies, Assistant City Manager Blake Jurecek, Assistant City Manager R. Kinley Hegglund, Jr., City Attorney Jessica Williams, Director of Finance Lindsay Barker, Dir., Comm. & Marketing Pat Hoffman, Property Manager Linda Merrill, Recording Secretary Travis Haggard Adrene Wike Dick Bundy Carol Sales Bert Huff Tim O'Reilly Gerri Kielhofher Steve Minton Elijah Joplin Ronda Smith Darren Harralson Andy Lee Phillip Otto Syd Litteken, Syd Litteken Architects Michael Tipton, General Manager Madeleine Calcote Darleen Van Winkle Kristin Marquess ABSENT: Tony Fidelie Michael Mills Members Mayor and Council City Staff Chamber of Commerce & Industry Forum O'Reilly Hospitality Management Picker's Universe Spectra § Members 1 1. Call to Order. Glenn Barham called the meeting to order at 8:59 a.m. 2. Approval of Minutes of 9/24/19. Dave Clark moved for approval, seconded by Rick Hatcher. The motion carried 5-0. 3. Public hearing regarding a funding request from Kirk Laney, dba Picker's Universe LLC, to renovate 1000 Indiana into a mixed use retail and restaurant establishment. Mr. Barham opened the public hearing at 9:01 a.m. Paul Menzies said this request was before the Board at its September meeting, and staff was requested to get clarification from the applicants on some numbers. Andy Lee and Syd Litteken are here to make a presentation. Andy Lee (1410 Grant, Wichita Falls, TX) said the sales tax revenue is 4% ahead of last year. The economy is in a good position. Last month, he highlighted the tourism impact on the economy. Lindsay Barker also noted that travel spending had increased due to more events being held in the city. This project would create an event center on the south side of downtown. They have not yet been approved for tax credits, but they are moving forward and will hopefully pull a permit in the next two weeks. Actual construction costs total $2.1 million, not including the cost of the kitchen equipment. Two aspects of this project are within the 4B purview: (1) the event center and (2) infrastructure costs. The event center has a mezzanine level, outdoor seating, and a restaurant. It will have the ability to encompass multiple events. On the infrastructure side, they are dealing with a 1929 cast iron water line on Indiana, and a clay tiled sanitary sewer system in the alley. The infrastructure costs alone are $585,000. The request of the 413STC is $345,000. Syd Litteken (1904 Club View, Wichita Falls, TX) said Mr. Laney put a new roof on the building. The plan is for a 12,000 square foot second floor mini -conference center with removable partitions. It could hold 300-400 people, and would be set up as a full-scale restaurant. A wine bar would be on the mezzanine level, and the antique store would remain on the main floor. They are going to install an elevator. It is harder to bring back an old building than to build something brand new, and he hoped the Board would give these old buildings some consideration. Mr. Leiker asked what kind of events they would attract, and if a market analysis had been done. Mr. Litteken said representatives of Picker's Universe are searching every market, including agricultural, ranching, business, art, and women's groups. There being no further comments, Mr. Barham closed the public hearing at 9:11 a.m. 4. Public hearing regarding a funding request from the Arts Council Wichita Falls Area, Inc. to renovate 2120 Speedway Avenue, otherwise known as "The Forum." Mr, Barham opened the public hearing at 9:12 a.m. Carol Sales (1300 Lamar, Wichita Falls, TX), CEO of the Arts Council, Wichita Falls Area, Inc., said the mission of the Arts Council is to nurture and strengthen the artistic, cultural and N educational quality of this community and the surrounding area. She gave a history of the organization, and its activities in the community, including the Home and Garden Show and its involvement with Region IX and the ISD. Dick Bundy (2022 Avondale, Wichita Falls, TX) is the architect for the Forum, and the Kemp Center for the Arts. The last major renovation was done in 2013, when they spent $2.4 million on the building. This current project takes into account the following: • Electrical upgrades • Acoustic enhancements in the auditorium • HVAC system and plumbing • Room dividers/moveable wall system • Fees and permits Nick Schreiber asked if there are any other issues that need addressed. Mr. Bundy said they will eventually replace service to the building with copper or some other aluminum substitution, and kitchen equipment needs replaced, but these are not necessary at this time. There being no further comments, Mr. Barham closed the public hearing at 9:19 a.m. 5. Public hearing regarding the NIPEC/Convention hotel. Mr. Barham opened the public hearing at 9:20 a.m. Blake Jurecek gave a brief history on the decision by City leaders to look into the viability of a full -service hotel, through the engagement of Gatehouse to construct such a facility and its subsequent financing difficulties. After the City terminated its agreement with Gatehouse in 2017, it sought RFPs from other interested developers. O'Reilly Hospitality Management (OHM) submitted the most favorable one, and City staff has been working with them toward an agreement. They are seeking approval from the 4BSTC for its participation in the project. The agreement would then be presented to the City Council at its November 5 meeting to obtain authorization for the City Manager to execute it on behalf of the City. Lindsay Barker discussed the need for a full -service hotel. The CVB sales staff does a great job in getting events and conventions, but the trend across the nation, including among the City's peer cities, is to have a full -service hotel either adjacent to or on -site of a city's convention center. Tim O'Reilly, CEO and Managing Partner of OHM (4045 E Sunshine St, Springfield, MO) thinks WF is an attractive market, and that downtown has its best days ahead of it. His company has similar developments in 9 states, and they have 1,600 team members. He has his own management company that handles all of their properties. The planned 200-room, 7-story Delta by Marriott is needed in order for the area to be truly successful. The hotel will (1) bring the world to Wichita Falls, and (2) act as a catalyst to other development. He observed that the local hotels are in desperate need of a stimulus to increase the ADR from $104 per night. OHM intends to initially charge $128 per night at the Delta, and the other hotels will follow this rate and reap the benefits, as will the tax base. It will bring tremendous growth to the area. A second on -site hotel might eventually be required. OHM would seek the land from the City for this development, but would not ask for other incentives. He then introduced Ronda Smith, Corporate Director of Sales and Marketing (1116 Oak Hollow Drive, Corinth, TX). Ms. Smith spoke regarding the offices OHM already has in place in the Dallas/Fort Worth area and in Austin, and of their ability to have their sales force actively recruit different venues to add Wichita Falls to their rotation. She noted that when the Denton Marriott opened, they already had $2.2 million of business on the books due to their proactive efforts. Mr. Schreiber asked if there was any detriment to Denton not having an airport. Ms. Smith replied that the 35-minute drive to the airport was an initial concern, but the Texas Association of Business is a driving market. Darren Harralson, Senior Director of Operations (5548 N Farm Road, Willard, MO) said he is responsible for multi -property oversight, which at present includes 14 properties that generate over $100 million in annual revenue, with over $400 million in assets. He also recruits/trains general managers. He believes one of the greatest strengths of this project is the power of Marriott. Founded in 1927, it is an innovative, award -winning company, and culturally aligned with OHM. Mr. Schreiber asked if OHM would manage MPEC. Mr. Leiker said Spectra would continue to manage MPEC. The new facilities would be managed by OHM. Mr. O'Reilly said OHM's investment in the project would total $48 million, without the convention center. The convention center would cost $11.9 million; it has been downsized in order to fit the City's budget. Steve Minton, Director of Architecture (767 S. Mumford Drive, Springfield, MO) next addressed the Board. He said the banquet room will hold 1,000 people, and is divisible into eight rooms. There are 34 guest rooms per floor, except for the 7 Ih floor, which will have presidential suites. They have oriented the front entrance to the hotel to face the MPEC Exhibit Hall. The restaurant will have a separate entrance in the lobby and from the exterior of the building. Gerri Kielhofner, 319 N. Main, Suite 200, Springfield, MO, is the architect of record on this project. They will work locally with Corlett, Probst & Boyd, and with Springfield mechanical and structural engineers. She has worked on several public/private partnerships and is familiar with City requirements. Mr. O'Reilly is a very hands-on CEO, which ensures good communication. She added that they make every effort to use the most appropriate products for each project. Travis Haggard, 4514 Ridgemont, Wichita Falls, asked that they speak on the economic impact of construction costs and whether local contractors and materials will be used. Mr. Leiker said it has been estimated that this project will generate an economic impact of $7 million during construction and for the next 10 years. Mr. O'Reilly said his team is not from Wichita Falls, but that is common in this industry. They will be pricing out and considering local vendors. Mr. Schreiber asked whether the meeting space was meant to be used in conjunction with the MPEC meeting rooms. Mr. O'Reilly said the City was adamant that this space not compete with MPEC, but rather, be used in association. Spectra General Manager Michael Tipton said MPEC gets around 7-10 conventions per year, but it stays very busy with events. The people attending these events need a place to stay, and it would be a great addition to the City. There being no further discussion, Mr. Barham closed the public hearing at 10:40 a.m. 6. Discussion regarding the operation of the Lindemann parking garage downtown. The Board moved this item to discussion during its executive session. 4 7. Executive Sessions. Mr. Barham adjourned the meeting into executive session at 10:40 a.m. pursuant to TEXAS GOVERNMENT CODE sections 551.072 and 551.087. He announced the meeting back into regular session at 12:21 p.m. The subjects posted in the Notice of Meeting were deliberated, and no votes or further action was taken on these items in executive session. 8. Motions. Request for funding from Kirk Laney, dba Picker's Universe LLC, to renovate the existing building at 1000 Indiana into a mixed use retail and restaurant establishment Mr. Leiker moved to approve funding for the direct costs of the fire suppression system, not to exceed $133,000, conditioned upon the property owner obtaining three bids for such system that are shared with the Board; such funding would be structured as a five-year forgivable loan, whereby each year the loan would be forgiven at 20%, and funds would only be given once the Certificate of Occupancy has been issued. Seconded by Mr. Clark, the motion carried 5-0. Request for funding from the Arts Council Wichita Falls Area, Inc. to renovate the existing entertainment venue at 2120 Speedway Avenue, otherwise known as "The Forum." The board took no action. Mr. Barham said the Board fully supports the project, however, and would consider funding it at some point in the future. MPEC/Convention Center Hotel Mr. Leiker moved to authorize the 4BSTC Chairman to execute the Master Development Agreement with O'Reilly Hospitality Management for the MPEC/Convention Center Hotel Project. Seconded by Mr. Clark, the motion passed 5-0. Lindemann parking garage operations Mr. Clark moved to authorize the City's Property Administrator to facilitate receiving bids on the parking garage's operation/utilization. Seconded by Mr. Hatcher, the motion passed 5-0. 9. Adjourn. The meeting adjourned at 12:24 p.m. Glenn Barham, Vice President 5