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 Good morning, everyone. My name is John Baines, and I'm happy to chair this meeting of the

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 City of Denton Economic Development Partnership Board, and we'd like to welcome the viewing

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 audience to this meeting. And we have several items on our agenda today, the first of which

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 is EDP 20-056, which is the approval of the minutes of November 11, 2020. And we'll give

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 everyone a chance to re-familiarize themselves if needed with the minutes, and then we'll

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 do a roll call to determine whether they pass or fail.

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 Chair, I move approval of the minutes as submitted.

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 We have a motion on the floor to approve the minutes as presented. Do I hear a second?

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 Second.

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 We have a second by Mark McClellan. Okay. Is there any discussion of the minutes? Seeing

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 none and hearing none, we will now do a roll call of all of the voting members. John Baines

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 votes aye. Jill Jester?

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 Aye.

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 Let's see. Jesse Davis?

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 Aye.

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 Tony Clark?

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 Aye.

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 Lee Ramsey?

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 Aye.

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 Martin McClellan?

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 Aye.

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 And then we have Steve Edgar joining us. I didn't know if Steve heard that conversation

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 or not. What is the protocol on that, parliamentarian?

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 I think Steve's still making his way in.

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 Yeah, it's okay. If we've got his approval by that, it should be acceptable.

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 He's not logged in yet, but I didn't know if we needed to wait or just go with what

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 we have.

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 If you have a majority vote at this point, you can move forward as approved.

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 Okay. Thank you. And we'd like to welcome Steve Edgar to the meeting. We will acknowledge

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 that the minutes are approved unanimously. We're now moving on to the next item on the

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 agenda, EDP 20-058. We're going to receive a report, hold a discussion, and give staff

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 direction regarding an incentive application for ranch land foods. And Jessica, who will

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 be leading that discussion?

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 So I will be doing the presentation this morning. I do want to let the board know that we are

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 having some internet issues on our end. So if I freeze or for some reason cut out, someone

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 flag us down or stop me so that we know. I'm able to watch myself, but I can't really see

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 anything on my own screen right now. So this is going to be an interesting presentation.

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 But before we get started, I also want to let you know that we have Ken Davis on the

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 line with us. Ken Davis is the CEO of ranch land foods. And so after I finish my presentation,

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 Ken will be available to answer questions about this project. And this project also

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 includes a discussion about the DME Economic Growth Writer. And so we also have Elizabeth

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 Ruiz from DME on the phone with us. She's going to be able to answer all of those questions

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 that I wouldn't be able to related to electric. So with that, I'm going to share my screen.

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 All right. Looks like we've got that working. All right. So for today, the board's consideration

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 today is an incentive application that we received from ranch land foods. Ranch land

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 is a food production and brand development company based out of Arizona. They're known

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 for raising cruelty free cattle and using sustainable ranching practices. They produce

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 all natural certified grass fed and grass finished Angus beef products, as well as high

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 quality poultry and pork products. They ship thousands of packages weekly to customers

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 nationwide, particularly customers that are looking for those all natural healthy meat

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 products. They also serve as a third party logistics e-commerce fulfillment center for

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 other companies. They are seeking to relocate their corporate headquarters in distribution

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 and to north central Texas. Denton is one location that they are considering. And for

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 this project, we are in direct competition with other cities in the Metroplex. And branch

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 land is interested in Denton, particularly because of our location and their ability

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 to expand their regional services. So the site and project itself, again, is a relocation

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 of a corporate headquarters and distribution center that will be shipping food and meat

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 products nationwide. It will serve as the centralized hub for their 3PL clients as well

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 as some of their product lines. The facility that they are looking at is the old Miller

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 facility as we know it on the right at the split of I-35 E&W right here that you see

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 on the screen. And the goals that they express to us in their application is that they're

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 seeking an incentive to reduce the impact of relocation and site improvements costs.

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 They're making a significant amount of improvements to that facility that we'll talk about later,

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 but also to encourage high wage job creation through their company's expansion. As we do

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 with any project, we review this for compliance with our incentive policy. I kept it a little

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 bit short this time, so the only provisions you'll see on the screen are the ones that

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 apply specifically to this project. So in terms of our general and priority considerations,

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 this project does create quality jobs and it is a targeted sector as they are a significant

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 consumer of municipal utilities. In terms of our priority considerations, they did meet

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 seven of our priority considerations. In this case, which we'll get into a little bit later,

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 we look at really increasing jobs with wages above Ditton County's median and a high number

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 of jobs paying $75,000 or more. For this project, we are proposing a chapter 380 incentive and

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 with that, we wanted to make sure that we were in compliance with the chapter 380 policy.

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 So this is a targeted industry cluster as a high user of municipal utilities. This would

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 also meet the provision that allows us to use cash incentives when we are in direct competition

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 with another city for a project, and again, increasing the percentage of jobs paying $75,000

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 or more. In terms of our other considerations, this project does have a net number of new

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 jobs with wages above Ditton County's median, which I break down further in the presentation.

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 And we'd also be looking at using the investment fund. They do meet two of the three criteria.

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 They meet the higher wage or knowledge-based jobs criteria as well as the industry sector

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 target criteria. So the application that was submitted by Ranchland Foods, again, a relocation

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 of a corporate headquarters and distribution hub, they are a targeted sector. They are

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 investing $5.7 million in capital improvements or business personal property at the location.

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 Because the building is existing, it already has a property value of about $3.9 million,

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 so they would be investing an additional $5.7 million above that. They are relocating or

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 creating 140 total jobs with a weighted average of the jobs being $69,893 and total payroll

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 at year 10, so full kind of growth and build-up of almost $10 million. I'm going to break

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 down those jobs and job numbers a little bit further. This is something that you guys have

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 been seeing as we've worked through a number of job grants. This one actually looks a lot

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 more similar to our job grants that we've been looking at. So here you see the major

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 categories of jobs and the estimated number. Here in the light blue line, you'll see the

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 total jobs for each individual year. In this darker blue line, you'll see the cumulative

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 jobs as we go. So about year eight, they estimate that they'll hit that 140 jobs. And then here's

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 the growth in the estimated annual payroll. So we're looking at starting around $4.7 million

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 and then eventually growing to that $9.8 million. Breaking down those average wages by job type,

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 again, we know that the weighted average is important. So here's the general average wage

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 by the sort of job category. So you'll see that almost all of the jobs, with the exception

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 of the administrative and warehouse staff, exceed that $75,000 number. And what we've

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 broken down here is that means 80 jobs of the 140 or 57% are jobs that are above $75,000.

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 90 jobs or 64% exceed the Denton County median and 80 jobs or 57% exceed the Denton County

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 average. So in terms of the proposal that we've developed, again, very similar to the

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 last proposal that you've seen for us, it includes a chapter 380 component that has

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 three sub components, a performance based relocation incentive. That is to assist the

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 company in their relocation expenses and to an incentive on their site upgrades that they're

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 making. It also includes a stratified job based incentive that includes the residency

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 bonus as you've seen before for that additional consideration for employees living in Denton.

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 In total, the chapter 380 portion of this incentive is $218,500. The other components

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 for this particular project is that because they are a significant user of municipal utilities,

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 if they meet that one megawatt threshold on demand, they would be eligible for the DME

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 economic growth rider. We've taken a look at the preliminary economic, excuse me, electric

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 data that the company has provided. We think they'd be right around that one megawatt demand.

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 And if they do, the value of that demand growth rider for them would be $197,000. This project

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 also meets the general criteria of the Texas enterprise zone program. That is a state approval

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 process. But because they do meet those criteria and we do have eligible nominations, we could

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 nominate and we do, staff does recommend nominating this company to the Texas enterprise zone

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 program. I'm going to break it down a little bit further for you in terms of the incentive

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 versus the ROI. Again, what you'll see up here in this top column or these top rows

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 here are the incentive numbers. We don't include the Texas enterprise zone program number that's

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 hard to quantify. And also that being a separate approval process outside of our control, we're

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 not looking at ROI from that. That also goes straight from the state to the company. So

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 we're only looking at the city involved portions of this incentive, but we also look at property

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 taxes that this project would generate over 10 years, sales taxes that this project would

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 generate over 10 years and then the additional increasing ratio of the demand revenue to

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 DME netted of the incentive of the economic growth rider. And with that, we have evaluated

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 an ROI for this project. You'll see the gross and net revenue on your screen. We did both

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 a five-year and a 10-year analysis. And we have found that this project has an ROI of

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 about 6.47, which means for about every dollar that we invest in this incentive, we would

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 see about $6 and 50 cents coming back to the city directly in terms of our fiscal impact.

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 So I will have one last slide on this project in terms of both qualitative and quantitative

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 benefits. So in terms of our qualitative benefits, again, this is a quality job creator project.

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 This company has also indicated a strong desire to work with the universities, particularly

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 the logistics program at UNT, to have a pipeline, internships, but really strong, indicated

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 a strong desire to connect with the universities. This is the recruitment and expansion of a

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 company, so a little bit of a two for the price of one on this project. And with this

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 particular project, it will occupy a currently vacant building, which is great, especially

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 a building that is highly visible. In terms of the quantitative benefits, as I mentioned

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 before, it has an estimated ROI of about 6.47. And then I've broken down the 10-year revenues

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 there for you. In terms of economic impact, we just finished our model this morning, but

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 we did find that over a 10-year period, in addition to the direct revenue to the city,

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 when we're looking at discretionary spending of employees for this company, we would see

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 an additional $553,000 injected into our local economy over 10 years, which would actually

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 increase the economic ROI to about 11.67. And with that, just a quick summary before

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 we start our discussion. This would be a five-year performance-based incentive, very similar

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 to ones that we've seen before, the relocation grant, stratified job-based grant, and a residency

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 bonus. All of those would be included in a Chapter 380 agreement. We would also recommend

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 nominating this company to the Texas Enterprise Zone program, with our staff assisting however

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 they need us in developing and submitting that application, and then also consideration

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 of the DME Economic Growth Rider. And with that, I will pause for questions.

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 Do we have any questions from the floor? I have a few, but I didn't want to be the first.

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 Okay. Counselor Jester has a question, please.

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 Hi, thank you. So this question is for Ken Davis. Mr. Davis, can you hear me?

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 I can. Thank you.

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 All right. Well, first of all, thank you for being with us today to talk about this project.

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 Obviously, you've got a really great company, and we think we've got a really great city,

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 which is why we're all here today. One thing I did not see in the application that typically

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 we see talked about a little bit is community involvement. That's something that's very

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 big here in Denton, not only with the Chamber and supporting other businesses, but other

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 nonprofit. Can you talk a little bit about what your current involvement is, and what

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 is your intention, or do you have a history of community involvement, and what that might

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 look like in the future if you end up coming to Denton?

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 Yeah, very good question. As a matter of fact, that's a point that we actually discussed

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 with Jessica and her team. We are highly involved in our community in Arizona, mostly with food

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 bank organizations within the city. Obviously, because we're in the food industry, helping

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 support not only financially, but also with products and time with our employees and assisting

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 with community involvement. It's definitely something that we are very strongly involved

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 with and something we see ourselves involved with in the city of Denton if we happen to

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 relocate here. We made a point, actually, as a company to bring that up to the group

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 because we wanted to find out who else was in the city, what organizations that are already

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 here so that we can be a part of that. That's great, and that's great to hear. Again, I

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 think obviously the plans that you have for relocation and expansion are very exciting

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 and what you're going to be doing wherever you end up moving to. We certainly appreciate

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 your interest here in Denton and think that it seems like a perfect fit for what you have

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 planned. As a member of the Chamber of Commerce, I hope if you do land here that you will join

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 the Chamber, and we look forward to your involvement in the community. Thank you, Mr. Davis.

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 Yes, absolutely. Thank you.

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 Do we have any other questions from the floor? I see Lee Ramsey, please, and Jamie Wilson.

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 Mr. Davis, thank you guys. We're excited that you guys are looking at the city of Denton.

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 Just one quick question. How many square feet is that existing building?

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 It currently comes in right under 64,000 square feet. However, there is another 11,000 square

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 feet that we're converting that's in a mezzanine to be the occupied space as well. So I think

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 it will end up closer to 70,000 by the time it's all said and done.

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 How much of that will be office and how much will be warehouse?

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 The office portion of that right now is right at about 10,000 square feet, a little under.

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 If we utilize the mezzanine space as office space, of course, that would increase that

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 by another 10,000. Our primary objective obviously with the office space, of course, as COVID

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 settles back down or whatever that process is, it is to house the majority of our team

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 in and on site. We do, of course, remotely now, but the purposes of that particular building

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 is because we do have a large staff that we'll be occupying on site.

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 Perfect. You answered my next question. So thank you. We're excited you guys are considering

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 Denton and thank you. I think you guys are a good fit for Denton. So thank you.

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 Thank you, Mr. Ramsey. We have Superintendent Wilson and then we have Mark McCullin next.

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 No specific questions, Mr. Baines and Chairman. I just wanted to say we're excited about the

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 opportunity to see additional resources such as this come to our community and have a great

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 community and look forward to having future partnerships if this does move forward. So

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 thank you, Mr. Baines. Thank you, Superintendent. Mr. McCullin?

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 A quick question about the staff that will be working at this location. Can you give

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 us a little bit of sense of the nature of that? Is it the type of work they'd be doing,

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 you know, hands on if you would? Sure. I'll start at our executive level staff.

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 Most of these positions will not be coming from Arizona. Most of them are being created

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 here by acquiring other high level executives from other food based companies. So this base

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 will serve as our corporate operations for nationwide. So we'll have a strong executive

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 staff that of course will operate the day to day operations as well as expansion of

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 the business, investment in other farmland within this North Texas region and the possibility

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 of another facility close to where we would be located if we're in Denton. The other positions

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 are all mostly in the logistics with our 3PL division as well as our direct to consumer

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 fulfillment. So we have several positions that will be in the warehouse, whether they're

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 pulling and packing orders every day. We have a wholesale component where we deliver to

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 hospitality and food service, restaurants, hotels within the region, also out of state.

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 So the components of most of the workforce is primarily driven around logistics. At this

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 facility will be no production of food. It'll mostly be in handling, shipping, delivering

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 by trucks, that type of thing. Well, Kenny, University of North Texas really

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 would look forward to an opportunity to partner with you. We certainly have a world class

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 logistics team here. It's one of the best, certainly in the state, if not the region.

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 And we have a lot of other technical capabilities too, including some around the food area that

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 happens to be my personal focus is food science. So anyways, we hope that we can partner with

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 you in terms of enhancing both operations as well as your search for a workforce.

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 Absolutely. It's something we very strongly are consuming because of the university. We

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 work very closely with the university in our city in Arizona and would like to do the same

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 with UNT as well. Great.

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 Thank you, Mark. I see Dr. Wilson, you have your hand still up or is that just wanting

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 to take down? It's still showing as your hand is raised. So, okay. I have four questions,

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 Mr. Davis. Does anyone else have questions before I ask mine? I didn't want to take too

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 much, but I did have four. The first one, you don't mind me calling you Kenny, do you?

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 No, that's fine. No problem.

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 My first question has to do about being certified as a practicing, how would you say, my family

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 and I are in the nutrition related lifestyle. And sometimes that certification comes and

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 goes. Have you ever had any issues with that or has that been a consistent for your company?

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 Since the very beginning, we sought out to get these designations and certifications

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 based on our product, what we produce. Initially from our own ranches and then our ranching

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 partners and farms that we work with. 90% of all of our product that has been certified

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 from the beginning, whether it's certified grass fed, certified organic or certified

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 non-gmo, we've held those from day one. We've never lost those certifications. We do obviously,

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 if you know, have to reapply. And it's third party validated. So, we're tested, our animals

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 are tested, our ranches are tested, and it's a designation we've never lost.

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00:23:50,720 --> 00:23:56,920
 Thank you, Kenny. My second question has to do with your overall operation. Where you

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 process your meats, where are those locations? Since this will mainly be an administrative

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 office, what do you do your processing? Very good question. So, we process depending on

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 the line of products or the line of protein in three different locations. Most of our

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 organic and grass fed stuff at this time is produced in Raleigh, California at a facility

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 called OWB, One World Beef. They have handled the harvesting and further processing or fabrication

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 of our product and then we move that product. Currently, right now, we'll be moving that

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 product to Texas after this first quarter to be further processed into cuts for food

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 service or consumers. We have several ranching partners here in North Texas as well in the

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 Panhandle in the Amarillo region. We've also are purchasing a large ranch in the North

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 Texas, Oklahoma region to start running cattle in this area as well because we process in

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 Fort Worth our Texas animals at the Fort Worth Meat Packers facility. So, we regionally have

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 been doing that for a while and what has prompted us to want to come to North Central Texas,

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 obviously to be a little closer to the production of our product and to have access to our warehouse

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 and distribution for a more centralized location for shipping. I will tell you that we are

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 in the company already in the discussions of if we land here in Denton or whatever city

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 we land in, we do know that we will be building a food processing facility close to whatever

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 distribution facility that we have. That's a necessity that we already know as a company,

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 an investment that we're already prepared to make, but it would be something we'd be

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 building out new. Thank you Kenny for such an excellent answer.

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 The third of my four questions is this, what's your timetable right now for making that decision

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 and making the move? Yeah, very good question. I think I told Jessica, we are prepared to

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 begin this move starting in mid-January. We've been making decisions here fairly quickly.

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 We're down to probably within the next week or so. We understand that the different councils

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 or groups or boards have to meet, but we plan on being operational as far as having jobs

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 there and hiring by the first part of February. We'll bring in some of our executive staff

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 in January. I've already hired several people or they'll be making their transition I should

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 say from their current employers in January to our company. We hope to be operational

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 by February. Thank you Kenny. My last question is this.

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 It's kind of a compound question. How many other suitors do you have for your relocation?

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 What strikes you as Denton being the best place for you? What attracts you the most

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 here? Good question. We have currently one other

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 strong suitor. We initially started looking at the four different site locations. We're

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 down to just Denton and another city of course in this area. I will say that Denton is favorable

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 to us because of its unique location for this facility and the ability to be able to expand.

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 We feel we're a little bit landlocked in the other facility or location. Denton gives us

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 access to both the east corridor of the Metroplex and of course the west corridor. Being in

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 that location, being able to go 35 to Dallas and 35 to Fort Worth from our food service

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 side and our wholesale side that we deliver to restaurants and hotels, etc., makes it

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 very, very convenient. I'm not sure if Jessica told you, my family

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 is originally from this area, from the North Texas area. I've had two kids that have gone

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 to UNT. So Denton holds a special place just because of our family, but also mostly because

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 of the location of the facility and the ability to be able to expand.

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 Kenny, thank you for such a wonderful answer and I'll give you personally five stickers.

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00:28:54,040 --> 00:29:02,120
 How about that? Great answer. Did anyone else have questions for Mr. Davis?

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 Okay, Jessica, we'll give it back to you, ma'am. I will add that if the Economic Development

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 Partnership Board moves this forward, we do have this scheduled to accommodate Mr. Davis's

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 very quick timeline for City Council at their first meeting in January. So if the Board

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 does choose to move it forward, we are making every effort we can to meet his timeline.

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 But with that, I welcome any questions from the Board regarding the proposal or if any

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 Board member wants to make a motion. Any Board members? Okay, I see Jill Jester's

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 hand. Counselor? Thank you, Chair. I would like to give a

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 shout out to Ms. Rogers and her staff. I thought this was very well laid out. I thought the

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 combination was very creative in trying to piece together the absolute best proposal

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 that we can make and present to Council. So I just want to say thank you for all of the

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 background work and I found it very, very helpful and laid out in a way that was easy

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 to understand. And so I just want to say really excellent work there. And with that at this

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 time, I will make a motion that we accept and recommend as the staff has summarized

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 and presented. So we have a recommendation to accept the

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 incentive application for ranch land foods. Do we have a second?

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 I'll second. Lee Ramsey seconds. Any further discussion

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 from the Partnership Board? Seeing none and hearing none, we will now

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 do a roll call once again. We'll start with Steve Edgar.

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 Aye. Thank you. Jimmy Mejia.

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 I recommend it as well. Thank you, Jimmy. Mark McClellan.

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 Aye. Lee Ramsey.

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 Aye. Tony Clark.

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 Exciting aye. Jesse Davis.

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 Aye. Gil Jester.

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 Aye. And John Baines says aye and it looks like

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 we have a unanimous recommendation to accept the application for ranch land foods.

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 So concluding items, do we have any concluding items we need to address today, Jessica?

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 I do not have any. I will say your staff reports are not in here as typical and that's because

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 we are working on a new report that hopefully you will see for the first time in January.

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 So we're very excited to have a revamped and refreshed report for you.

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 Thank you and it's the season to be jolly. We want to wish everyone a happy holiday season

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 and we'll entertain a motion to adjourn the meeting if there's nothing further.

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 Move adjournment. Do we have a motion?

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 Second. Okay. All in favor of adjourning, signify

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 by saying aye. Aye.

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00:32:36,520 --> 00:32:42,160
 Aye. Okay. Jessica, will that do? We didn't do a roll

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 call. Is that okay? We're good.

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 All right. Thank you all for your time and thank you to all the staff and our city manager

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 and everyone for making this a great proposal and recommendation for our city. Everyone

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 have a great one. Merry Christmas and happy new year.

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 Merry Christmas, everybody.