4A Wichita Falls Economic Development Minutes - 03/10/2011MINUTES OF THE
WICHITA FALLS ECONOMIC DEVELOPMENT CORPORATION
March 10, 2011
PRESENT'
Gary Shores, President
Dick Bundy, Vice President/Sec.- Treasurer
Dave Lilley
Gary McLendon
Linda Ammons
Darron Leiker, City Manager
Kevin Hugman, Asst. City Manager
Jim Dockery, CFO /Asst. City Manager
Miles Risley, City Attorney
R. Kinley Hegglund, Jr., Sr. Asst. City Attorney
Tim Chase, President
Kevin Pearson, Vice President
Michael Stanford
Okechukwu Okeke
ABSENT'
Lanham Lyne
1. CALL TO ORDER
Members
Council Liaison
City Staff
Chamber of Commerce & Industry
Pratt Whitney
Member
President Gary Shores called the meeting to order at 4:00 p.m.
2. APPROVAL OF MINUTES (JANUARY 31, 2011)
Dick Bundy, seconded by McLendon, moved that the minutes be approved. The
motion carried.
3. PRATT & WHITNEY CANADA — CNC MILLING MACHINE PROJECT
Michael Stanford noted that the company focuses primarily on after - market repairs on
engine components. Five axis and adaptive machining has been around a while, but the degree to
which the company wants to apply the technology is unprecedented. Manual blending is a
critical element of repair work. The contoured air foils do not lend themselves to traditional
machining operations, and manual blending for each job is a 12 -14 hour task of grinding metal.
The CNC milling machine project would create a customized machining process for each part to
be restored. It would reduce manual blending time by about 75 percent.
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WFEDC — Minutes of March 10, 2011 2
The acquisition of this technology would allow 12 blender employees to eventually move
into higher skilled positions. The average wage for a blender is $16 per hour, while an inspection
position pays an average $20 per hour.
The cost for the software, hardware and installation is $785,000. They have a tentative
investment commitment from Corporate for $392,500. They will reduce their costs locally to
bring the shortfall to $287,500.
Tim Chase said if the County agrees to a standard property tax abatement for new
investments, it would generate savings over 10 years of $22,000. The standard $1,200 per
employee for new training from the Skills Development Fund will most likely be available. That
leaves a $250,125 shortfall that the 4A Board is being requested to consider funding. The
Performance Agreement can work out the milestones of increased wages and retention of jobs.
Mr. Shores asked if a decrease in employment is anticipated through the use of this new
technology. Mr. Stanford said there is no intention to reduce employment. Miles Risley asked if
this machine would replace any other machines. Mr. Stanford replied that, for the most part, it
would replace blender booths that are fully depreciated.
Mr. Dockery understands this project is for the benefit of Pratt & Whitney, but how does
it translate into being a 4a- funded project. Mr. Chase said it is a preemptive move to capture a
market that might otherwise not come here, which in turn could affect the entire company. It
would not only help maintain this company, but move it to the next level. In addition, it is
beneficial to demonstrate to Corporate headquarters the community's commitment.
Mr. Shores asked how long a shelf life this machine will have before it is rendered
obsolete by new technology. Mr. Stanford said this is so cutting -edge that it is not anticipated it
will be replaced soon. The machine itself has multiple uses; both Mr. Stanford and Okechukwu
Okeke asserted that the technology is in the software. Mr. Shores thanked them for their
presentation. Messrs. Stanford and Okeke left the meeting.
Discussion ensued regarding this project. Dick Bundy moved for approval of up to
$265,125, along with a claw back clause to be determined Seconded by Mr. McLendon the
motion carried.
4. FINANCIAL REPORT
Kevin Hugman distributed the financial report and updated the Board on the various
projects. Sales tax collections are up about 5.6% above for the year. Mr. Chase provided a brief
update for each project:
Carter Aviation — updating their newly - leased building, and will thereafter begin
production of four prototypes. Flight testing has been positive. Additional flights are necessary
before the wings are mounted.
Natura — manufacturing between 1,000 to 2,000 crib mattresses per day, with 70
employees working two shifts.
WFEDC — Minutes of March 10, 2011 3
Sharp Iron/Armor Control — commitment from ABB to continue to manufacture
customized boxes is in place.
WDS Global — has increased wages as it is struggling with high turnover rates. Doing as
well as could be expected in the market.
Wichita Clutch — everything is going well.
Buy Dental — building has been bought and moved on -site; waiting for ADA compliance.
The dispute made the basis of a suit filed by Bank of America has been resolved, and the suit
will be dismissed.
Latex International — timeframe has not changed regarding additional manufacturing in
Wichita Falls. They have 55 employees working two shifts.
Magic Aire — they have exceeded their expectations by capturing a new market share.
Excalibur — working to set up a distributor in the U.S.; he has one set up in Canada.
Major manufacturing companies are buying limited quantities of his product.
5. ADJOURN
The meeting adjourned at 5:20 p.m.
Gary ores, President