1 00:00:00,000 --> 00:00:24,000 We are now going to open up the City of Denton's Economic Development Partnership Board special 2 00:00:24,000 --> 00:00:31,000 meeting this Wednesday, July 20, 2022. Again, thank you all of the members and all of the 3 00:00:31,000 --> 00:00:37,000 executives and staff, et cetera, for being here today. It's going to be a great day. 4 00:00:37,000 --> 00:00:44,000 We will begin with our items for consideration beginning with item A, MSTDP 22-045, Consider 5 00:00:44,000 --> 00:00:50,000 Approval of the Minutes of May 11, 2022. These were included in the packet that went out 6 00:00:50,000 --> 00:00:56,000 ahead of this meeting and hopefully everyone's had a chance to review. Is there a motion? 7 00:00:56,000 --> 00:00:57,000 No approval. Second. 8 00:00:57,000 --> 00:01:04,000 All right. It's been moved and seconded. Approving the minutes as presented in the packet sent 9 00:01:04,000 --> 00:01:13,000 out earlier on. Is there any discussion before we take a vote? Hearing none, all those approving, 10 00:01:13,000 --> 00:01:20,000 please signify by saying aye. Aye. All those opposed, please signify by saying nay. And 11 00:01:20,000 --> 00:01:27,000 the motion carries. Moving on to item for consideration B, EDP 22-038. Receive a report, 12 00:01:27,000 --> 00:01:32,000 hold a discussion and give staff direction and make a recommendation to city council 13 00:01:32,000 --> 00:01:38,000 regarding an economic development catalyst fund for incentives. Of course, this has been 14 00:01:38,000 --> 00:01:44,000 in the making. We're very excited to have it brought before us once more. And we're 15 00:01:44,000 --> 00:01:49,000 even more excited for our new director of economic development. Would you please introduce 16 00:01:49,000 --> 00:01:55,000 yourself to everyone and talk to us? Absolutely. All right. Good morning, members of the board. 17 00:01:55,000 --> 00:02:02,000 My name is Wayne Emerson. This will be my first public speaking with the folks here 18 00:02:02,000 --> 00:02:08,000 at the city of Denton. So to give you a little bit of background myself, kind of really all 19 00:02:08,000 --> 00:02:15,000 started here in Denton. Went to school at UNT as a history major. At that time, I was 20 00:02:15,000 --> 00:02:21,000 in the Texas National Guard or as a military journalist. My studies were interrupted briefly 21 00:02:21,000 --> 00:02:26,000 my senior year. I ended up doing a deployment to The Rock where I served as my unit's public 22 00:02:26,000 --> 00:02:32,000 affairs officer. After graduation, I went on and became a history teacher, geography 23 00:02:32,000 --> 00:02:37,000 teacher, economics teacher, a little bit of everything in South Irving at Nimitz High 24 00:02:37,000 --> 00:02:43,000 School. And then from there kind of had grown to love economics and geography said, you 25 00:02:43,000 --> 00:02:48,000 know, I'd really love to start doing this kind of stuff. So I went back to school, got 26 00:02:48,000 --> 00:02:54,000 my master's in business administration from the University of Texas in Austin and figured 27 00:02:54,000 --> 00:02:58,000 out that, you know, economic development was something that I could really leverage all 28 00:02:58,000 --> 00:03:05,000 those skills. Got my first job in economic development as the analyst for the Allen EDC. 29 00:03:05,000 --> 00:03:12,000 And then from there went on to become a district manager, redevelopment manager for the city 30 00:03:12,000 --> 00:03:21,000 of Dallas, doing a couple of tip districts, pace financing, those types of things at Dallas. 31 00:03:21,000 --> 00:03:26,000 And then incredible opportunity to return to didn't came up that I couldn't pass. And 32 00:03:26,000 --> 00:03:34,000 so I'm very happy to be here. One of the things that really made this job seem attractive 33 00:03:34,000 --> 00:03:39,000 is knowing that the city had just gone through its adopting its new strategic plan, which 34 00:03:39,000 --> 00:03:45,000 I'll be talking about in here. And then especially the catalyst fund to help make us a bit more 35 00:03:45,000 --> 00:03:54,000 competitive in the market. So that's me. Anybody have any questions or anything about that? 36 00:03:54,000 --> 00:04:00,000 Do you want to share with us why didn't is better than Dallas or when does that happen? 37 00:04:00,000 --> 00:04:05,000 Well, first of all, it's the cold, right? Seriously, that's, that's what makes didn't 38 00:04:05,000 --> 00:04:11,000 didn't is it's the culture. It's, it's the, you know, it's the vibe. It's the students, 39 00:04:11,000 --> 00:04:16,000 the university, they keep us young, I think they keep us moving forward. And that's, that's 40 00:04:16,000 --> 00:04:22,000 what I'm gonna do is we want to all kind of grow up and hopefully, I came back, but let's, 41 00:04:22,000 --> 00:04:26,000 let's keep some of those, those young people here so we can make this a better place. And 42 00:04:26,000 --> 00:04:32,000 I think the catalyst fund is how we're going to do it. All right. Any other questions? 43 00:04:32,000 --> 00:04:41,000 Well, I just want to remind you, we do have universities here. Really good looking people 44 00:04:41,000 --> 00:04:47,000 have been to I'm sure is a big part of why you are here. We're absolutely thrilled you're 45 00:04:47,000 --> 00:04:52,000 here. And we're very excited to talk about possibly funding the catalyst fund that has 46 00:04:52,000 --> 00:04:58,000 been recommended to us through the strategic plan and through the project that was done 47 00:04:58,000 --> 00:05:05,000 by tip strategies. So thank you so much and take it away. Absolutely. All right. So a little 48 00:05:05,000 --> 00:05:10,000 background. It's my understanding that this is probably not the first time some of you 49 00:05:10,000 --> 00:05:16,000 have seen this. I think it's been brought through various boards and approving bodies 50 00:05:16,000 --> 00:05:24,000 and councils, but let's just kind of rewind here. So in February 2021, the city council 51 00:05:24,000 --> 00:05:30,000 adopted the economic development strategic plan, which was the first in 17 years. So 52 00:05:30,000 --> 00:05:37,000 it had been some time. Part of those goals were to kind of modernize and align the economic 53 00:05:37,000 --> 00:05:44,000 development strategies with the values of the community. The plan, basically we went 54 00:05:44,000 --> 00:05:53,000 through for implementation and a 2021 planning session staff work to align our current incentive 55 00:05:53,000 --> 00:05:59,000 tools that we have with the policy. So Eric took that with tax abatements and our three 56 00:05:59,000 --> 00:06:07,000 eighties. And what I'm kind of going to do is tell you how this this new tool, the catalyst 57 00:06:07,000 --> 00:06:15,000 fund is going to align with our strategic plan and why it was recommended. So when tip 58 00:06:15,000 --> 00:06:21,000 came through, they had some of these guiding principles for the for resiliency, future 59 00:06:21,000 --> 00:06:28,000 focus, inclusive growth, entrepreneurial spirit and cultural vitality. And all those 60 00:06:28,000 --> 00:06:33,000 guiding principles that came up with some core goals. So accelerate recovery. So probably 61 00:06:33,000 --> 00:06:39,000 at the time, I think the the real worry was that, hey, we got to get our businesses back 62 00:06:39,000 --> 00:06:44,000 on their feet. We need to get some demand because that's that's primarily the fear out 63 00:06:44,000 --> 00:06:49,000 there. But I think if we kind of look at it today, we're still suffering from COVID. But 64 00:06:49,000 --> 00:06:53,000 it's a completely different problem now, right? Now we're now we need workers we need 65 00:06:53,000 --> 00:06:58,000 we need to help our employers to keep them here. They need employees. So that's that's 66 00:06:58,000 --> 00:07:02,000 changed a little bit. And we're going to it's kind of been a moving target and we're going 67 00:07:02,000 --> 00:07:08,000 to help pivot to help that out. Foster growth. I think this has been traditional economic 68 00:07:08,000 --> 00:07:13,000 development that we're probably all familiar with. That's the main goal. But down here 69 00:07:13,000 --> 00:07:17,000 at the bottom, we have, you know, something that's new that communities are starting to 70 00:07:17,000 --> 00:07:22,000 consider, which is strengthen community inclusion. So to do that, we have to align our economic 71 00:07:22,000 --> 00:07:29,000 our workforce, our community development efforts and make sure that when we grow that we're 72 00:07:29,000 --> 00:07:36,000 being inclusive or not leaving anyone behind. Alright, so the the specific tool that we're 73 00:07:36,000 --> 00:07:43,000 going to talk about today outlined in the strategic plan is the catalyst fund. So the 74 00:07:43,000 --> 00:07:49,000 plan included recommendations related to capacity and resource, right? So in order to do all 75 00:07:49,000 --> 00:07:54,000 the great things we need, we're going to need funding to make that happen. And they 76 00:07:54,000 --> 00:08:02,000 recommended three ways to to kind of seed this fund. The first was using utilities. 77 00:08:02,000 --> 00:08:07,000 When I was in Dallas, this is what we did. We we have a public private, sorry, public 78 00:08:07,000 --> 00:08:14,000 partnership, partner partnership program that we we use our water utilities to fund that. 79 00:08:14,000 --> 00:08:20,000 So that's a strategy that cities have used. And it's a strategy that cities use that don't 80 00:08:20,000 --> 00:08:25,000 have a type A or type B, which I'll talk about a bit more here in a second. This other 81 00:08:25,000 --> 00:08:31,000 recommendation was pretty creative is using our incentive rollbacks. So right now we already 82 00:08:31,000 --> 00:08:37,000 have development agreements with companies, with developers. And so this these dollars 83 00:08:37,000 --> 00:08:42,000 are coming from the general fund. So with the incentive rollback, what we're asking 84 00:08:42,000 --> 00:08:49,000 is taking those dollars that we've already dedicated to past projects and just keeping 85 00:08:49,000 --> 00:08:58,000 those and placing those into a catalyst fund as a recurring deposit into the fund. So why 86 00:08:58,000 --> 00:09:04,000 why do we need a catalyst fund? So these are some of the considerations and reasons. 87 00:09:04,000 --> 00:09:13,000 Number one is to meet our strategic objectives. Flexibility, the catalyst. So when you're 88 00:09:13,000 --> 00:09:18,000 looking at certain tools, you can only use them, you know, tax evade, you know, might 89 00:09:18,000 --> 00:09:25,000 not necessarily be for every project. If we have a catalyst fund, we can be flexible. 90 00:09:25,000 --> 00:09:30,000 This what we're going to kind of ask here is it's going to take time to get to where 91 00:09:30,000 --> 00:09:36,000 we need to go. So it's not going to build itself in, you know, one day or one one session. 92 00:09:36,000 --> 00:09:40,000 And then the level of resources needed to carry this out is not going to be static. 93 00:09:40,000 --> 00:09:45,000 And I'm going to kind of paint a little picture for you. And actually, at your table there, 94 00:09:45,000 --> 00:09:51,000 you've got you can kind of see how the flow of funds will kind of come in. What's more 95 00:09:51,000 --> 00:09:56,000 we're recommending. And then obviously we just need like this will just be one tool. 96 00:09:56,000 --> 00:10:02,000 We'll still have other economic development tools to work with. And so currently we have 97 00:10:02,000 --> 00:10:07,000 an investment fund. And the idea is basically we're going to take our current investment 98 00:10:07,000 --> 00:10:17,000 funds and transition into this catalyst fund. Okay, so what are we going to do with this? 99 00:10:17,000 --> 00:10:26,000 Okay, so prior staff and the consultants got together and they determined we look at all 100 00:10:26,000 --> 00:10:32,000 these various strategic initiatives, goals that we're going to need about seven to nine 101 00:10:32,000 --> 00:10:41,000 million to kind of hit on all of these. So you can kind of see business recruitment, 102 00:10:41,000 --> 00:10:46,000 which is, you know, it's pretty standard economic development business retention. 103 00:10:46,000 --> 00:10:51,000 I think it's very important because just like in any business, it costs you a lot more to 104 00:10:51,000 --> 00:10:56,000 gain a new customer than the cost of keeping what you already have. 105 00:10:56,000 --> 00:11:03,000 Traditional Fedrock economic development infrastructure utilities, job based grants. 106 00:11:03,000 --> 00:11:09,000 This is how we encourage employers to come here. Innovation and entrepreneurship is important 107 00:11:09,000 --> 00:11:16,000 because small businesses, startups, we always look for the big companies, but you know, 108 00:11:16,000 --> 00:11:22,000 small business is the backbone of American jobs. I think something like 80% of all people 109 00:11:22,000 --> 00:11:30,000 actually work for small business. Access for historically underutilized businesses. 110 00:11:30,000 --> 00:11:35,000 This is important that we're making sure that part of our inclusive development goals. 111 00:11:35,000 --> 00:11:41,000 Green incentives. This is just important just I think for our positioning, our marketing, 112 00:11:41,000 --> 00:11:48,000 how we want to position the city of Denton. Class A office space. 113 00:11:48,000 --> 00:11:56,000 I think Class A is kind of a real marker to where we want to go. 114 00:11:56,000 --> 00:12:02,000 And to get there, oftentimes the market, you know, we need to help it along. 115 00:12:02,000 --> 00:12:08,000 And this catalyst fund is going to be crucial if we hope to get Class A office development. 116 00:12:08,000 --> 00:12:13,000 Because once we get the Class A office, then we're going to be able to bring in those corporations 117 00:12:13,000 --> 00:12:19,000 with those much higher paying jobs. And then of course, affordable housing and housing redevelopment. 118 00:12:19,000 --> 00:12:24,000 I think one of our strengths right now is that we are an affordable place to live. 119 00:12:24,000 --> 00:12:29,000 And as we grow, we want to ensure that that maintains. 120 00:12:29,000 --> 00:12:38,000 All right, the catalyst fund. So I had mentioned Type A and Type B. 121 00:12:38,000 --> 00:12:47,000 I would say most cities in Texas utilize either a Type A or Type B program to fund economic development. 122 00:12:47,000 --> 00:12:52,000 So these Type A and Type B are funded from sales tax, right? 123 00:12:52,000 --> 00:12:59,000 So essentially, Type A and B, there's some small differences, but basically they're very similar. 124 00:12:59,000 --> 00:13:06,000 And what we did is when we started, and TIP had done this, but I wanted to dig a little deeper, 125 00:13:06,000 --> 00:13:12,000 is we started to look at all the cities in Texas and we wanted to see, A, how they were funded, 126 00:13:12,000 --> 00:13:17,000 Type A or Type B, but how much they were funding. So you can just kind of take a look at here. 127 00:13:17,000 --> 00:13:22,000 And I'm sure we can recognize most of these names, kind of the big boys in the area. 128 00:13:22,000 --> 00:13:28,000 Over here, we have more of our geographical competitors at top. 129 00:13:28,000 --> 00:13:36,000 Down here at the bottom, these are cities that are funding about four million, which, spoiler alert, 130 00:13:36,000 --> 00:13:39,000 that's kind of what we're going to be asking and recommending. 131 00:13:39,000 --> 00:13:43,000 So you can see the type of cities that we have here. 132 00:13:43,000 --> 00:13:50,000 But I'm going to kind of break this down and have you look at it a little bit more in this next slide. 133 00:13:50,000 --> 00:13:57,000 So when we're looking at the cities and how much they're investing in economic development, 134 00:13:57,000 --> 00:14:03,000 I thought it was very important to look at it on a per capita basis, based on our population, 135 00:14:03,000 --> 00:14:08,000 because this is ultimately what we're investing in is ourselves, we're investing in our residents. 136 00:14:08,000 --> 00:14:13,000 And I think this slide is, you know, kind of brings us into focus. 137 00:14:13,000 --> 00:14:17,000 So Roanoke, you know, interesting. 138 00:14:17,000 --> 00:14:22,000 I guess they are really just a main street and they bring everyone into their main street, 139 00:14:22,000 --> 00:14:30,000 but they're collecting over $1,204 per resident and putting that back into their community. 140 00:14:30,000 --> 00:14:37,000 But Frisco's, Allen's, Coppell's, you know, they're north of $300 per resident. 141 00:14:37,000 --> 00:14:46,000 Lewisville, Denton County, you know, they're investing about $92 per resident. 142 00:14:46,000 --> 00:14:54,000 And then if we get into some of the cities that are investing about $4 million total in economic development, 143 00:14:54,000 --> 00:14:58,000 we can see some of these names here, Buda, Cleburne. 144 00:14:58,000 --> 00:15:06,000 And then right here, this is what we're asking, what we're recommending to go to council just to get this catalyst fund started. 145 00:15:06,000 --> 00:15:10,000 It's about $27 per resident. 146 00:15:10,000 --> 00:15:13,000 So, all right. 147 00:15:13,000 --> 00:15:18,000 So if we get these funds, are we going to be able to use them? 148 00:15:18,000 --> 00:15:25,000 So what we did is we took a look at this is a snapshot of the projects that are a pipeline. 149 00:15:25,000 --> 00:15:31,000 Not all these projects are going to happen, but these are the types of projects that they've come to the city. 150 00:15:31,000 --> 00:15:36,000 They said we have interest in investing into the city. 151 00:15:36,000 --> 00:15:39,000 Here are, you know, here's the investment we're going to make. 152 00:15:39,000 --> 00:15:45,000 And then staff, what we did is, you know, looking at typical what these requests would look like. 153 00:15:45,000 --> 00:15:47,000 We came up with some estimates. 154 00:15:47,000 --> 00:15:51,000 So this first one is recruitment or new development. 155 00:15:51,000 --> 00:15:56,000 So this is any business or development that's not currently within the city. 156 00:15:56,000 --> 00:16:05,000 That's about $273 million in investment and about $4 million in incentives to make that happen. 157 00:16:05,000 --> 00:16:17,000 Can we clarify capital investment being what the companies would be investing to increase the property tax value, to increase the value period. 158 00:16:17,000 --> 00:16:23,000 So that's their investment versus what we're saying we could also help invest to incentivize them. 159 00:16:23,000 --> 00:16:25,000 Just wanted to make that clear. 160 00:16:25,000 --> 00:16:28,000 And then bottom, this would be redevelopment. 161 00:16:28,000 --> 00:16:33,000 So this is development on existing sites that's going to result in some added value. 162 00:16:33,000 --> 00:16:37,000 And to your point, Jill, is one thing you might notice. 163 00:16:37,000 --> 00:16:44,000 It's not working there, but you'll notice that there's actually probably less capital investment in the redevelopment. 164 00:16:44,000 --> 00:16:48,000 But you can see that the incentives are actually more. 165 00:16:48,000 --> 00:16:54,000 And typically the reason why we have this is because redevelopment is already in a prime location. 166 00:16:54,000 --> 00:16:56,000 So you're going to have higher land values. 167 00:16:56,000 --> 00:17:01,000 And then there's just higher associated costs with redeveloping than you would have on a greenfield site. 168 00:17:01,000 --> 00:17:05,000 So that's kind of where we're moving and we're looking at redevelopment. 169 00:17:05,000 --> 00:17:09,000 That's just something to be aware of that it does cost more to redevelop. 170 00:17:09,000 --> 00:17:15,000 And that's usually why it requires more in city involvement is to kind of help bridge that gap. 171 00:17:15,000 --> 00:17:24,000 So if we look at this snapshot today, we're looking at about $411 million in private investment. 172 00:17:24,000 --> 00:17:29,000 And to make that happen, we need close to about $17 million. 173 00:17:29,000 --> 00:17:37,000 And all these projects would probably take anywhere between three to five years before we see them break ground and open. 174 00:17:37,000 --> 00:17:42,000 So that's kind of the timeframe if these were to move forward. 175 00:17:42,000 --> 00:17:55,000 Okay. So this is kind of my philosophy and how I would like to use these funds and manage them is when we're looking at a but for. 176 00:17:55,000 --> 00:17:58,000 I always do what's called a financial gap analysis. 177 00:17:58,000 --> 00:18:05,000 So what this means is if someone comes to us and they say, hey, I just want I want to invest in your city. 178 00:18:05,000 --> 00:18:09,000 How much money can you give me? That's really not how I like to do it. 179 00:18:09,000 --> 00:18:14,000 The question is, is, well, how much do you actually need to make this project happen? 180 00:18:14,000 --> 00:18:22,000 So in order if we're going to take these funds and we're going to stretch them as far, we got to make sure that we're not leaving money on the table necessarily. 181 00:18:22,000 --> 00:18:25,000 Right. We're giving more money on the table than is necessary. 182 00:18:25,000 --> 00:18:31,000 So in order to do this, we need a financial gap analysis to do this. 183 00:18:31,000 --> 00:18:40,000 I'd like for us to contract from the outside underwriter folks that are in the banking business that do this daily when they make private investments. 184 00:18:40,000 --> 00:18:46,000 And we would do the same thing with our underwriting to ensure that this investment is actually needed. 185 00:18:46,000 --> 00:18:51,000 And then we'd also do a project feasibility. Is this project feasible? 186 00:18:51,000 --> 00:19:02,000 If we invest in it, is it is it going to work? Are we going to see our investment go into a black hole and then it closes and we lost those dollars? 187 00:19:02,000 --> 00:19:07,000 So back to gaps, there are really kind of three types of gaps that we're looking for. 188 00:19:07,000 --> 00:19:13,000 The first would be lack of capital. Typically, we see this with small businesses, startups. 189 00:19:13,000 --> 00:19:20,000 They have an idea, they have a good business and they're wanting to break it on their own, but they just don't have the equity. 190 00:19:20,000 --> 00:19:24,000 And when the bank comes to them, they have certain loan to value requirements. 191 00:19:24,000 --> 00:19:29,000 And essentially you end up with an equity gap. So that would be one type of gap. 192 00:19:29,000 --> 00:19:39,000 Second would be cost of capital. The project is cash flows. The project could be successful, but it just does not. 193 00:19:39,000 --> 00:19:42,000 It can't support the debt service that banks are looking for. 194 00:19:42,000 --> 00:19:53,000 So sometimes it needs just a little a little extra push in there to help to help support the project so that we're meeting our debt service payments with enough cushion. 195 00:19:53,000 --> 00:20:02,000 And then lastly is return on equity. So in this in this instance, hey, it's a good project. It meets all of our banking requirements. 196 00:20:02,000 --> 00:20:06,000 It's just that it's going to be really hard to get an equity investor on board. 197 00:20:06,000 --> 00:20:14,000 Maybe not right now, but you know, in the future they might be able to get that in the stock market or they might the equity might say, hey, why would I invest in Denton? 198 00:20:14,000 --> 00:20:20,000 I could go to Frisco. I could go to Plano. I could go to Dallas and I could get a much higher return on my equity. 199 00:20:20,000 --> 00:20:25,000 So that's that's the third type of gap that we would look at. 200 00:20:25,000 --> 00:20:39,000 So in addition, I'm all about leverage. I love leverage when I'm using my funds. I want to make sure that if I'm investing into something that everyone else is on board and we're all investing together. 201 00:20:39,000 --> 00:20:46,000 So the first piece that I would look at is that sponsor or their private equity. Do they have skin in the game? 202 00:20:46,000 --> 00:21:05,000 And then we want to make sure that the private debt markets, whether it's local banks or national banks, are they invested, right? Because I also want to use their underwriting and their view of the project of it being successful so that I know I'm investing in a safe investment. 203 00:21:05,000 --> 00:21:16,000 Mezzanine funds, PACE financing, Grow America, these are these are various funds that we could use to help close that gap as well so that we're not the one completely filling that gap. 204 00:21:16,000 --> 00:21:27,000 There's some other sources of funding. Federal tax credits, historical tax credits, new market tax credits, LIHTC, state and other local incentives. 205 00:21:27,000 --> 00:21:37,000 Same thing. We have TURS here, right? That's another tool. If I can use the Calis Fund and I can use TURS funds to help close that gap. 206 00:21:37,000 --> 00:21:46,000 Tax abatements, states dollars, Texas Enterprise Funds, Skills Development Fund. So anything we can do to really kind of leverage those investments. 207 00:21:46,000 --> 00:21:58,000 And then I really started looking at funding options, grants, I think we're all familiar with. But I think in terms of sustainability, I think it would be smart for us to start looking at loans. 208 00:21:58,000 --> 00:22:07,000 Because in this sense, we're going back to some of those types of gaps. Sure, we could give a grant and that will fill the gap. 209 00:22:07,000 --> 00:22:14,000 But there's also maybe opportunities that really all they need to meet those debt service requirements is just a low interest loan, right? 210 00:22:14,000 --> 00:22:23,000 And then when the project is successful, they can return that money back to us and we can reinvest that back into our community. 211 00:22:23,000 --> 00:22:32,000 So other things to think about when we're looking at why we should participate is we always want to look at the public benefit. 212 00:22:32,000 --> 00:22:39,000 And so the easiest thing to do is look at the fiscal impact. So these are the tax revenues that we would collect from it. 213 00:22:39,000 --> 00:22:49,000 That could be direct, that could be indirect. But I don't know if y'all have done this in the past, but one thing, we can kind of be insular and we can only look at how it affects us. 214 00:22:49,000 --> 00:22:57,000 But we might want to look how it affects all the taxing entities because our residents are paying taxes into the debt and ISD and they're paying it to the county. 215 00:22:57,000 --> 00:23:05,000 So if we're bringing private investment, they can bring dollars into the school district and into the county. 216 00:23:05,000 --> 00:23:11,000 There are going to be beneficiaries of that investment on those other taxing entities as well. 217 00:23:11,000 --> 00:23:19,000 Economic impact. So these are direct and indirect private investment and spending that would happen as a result of the project. 218 00:23:19,000 --> 00:23:26,000 Jobs, right? We want to make sure that we're going for target industries and we're looking for the higher wages. 219 00:23:26,000 --> 00:23:33,000 We don't want to necessarily be investing in companies that are not investing in our residents. 220 00:23:33,000 --> 00:23:46,000 Environmental sustainability, inclusive development and historical and cultural or other considerations we need to make just besides the fiscal and economic impacts. 221 00:23:46,000 --> 00:23:58,000 These are things that we identified in the strategic plan that are important to us and maybe the private sector doesn't usually value because they have a bottom line. 222 00:23:58,000 --> 00:24:03,000 We have a double bottom, right? We want to give back into the community. 223 00:24:03,000 --> 00:24:08,000 All right. So here's some funding options and David, did you want to speak about the funding options? 224 00:24:08,000 --> 00:24:13,000 Sure. I want to speak to some of the funding options to kind of set a timeline. 225 00:24:13,000 --> 00:24:21,000 Next week, next Tuesday, we have a work session with city council to go over a lot of what the presentation has been so far on the catalyst fund. 226 00:24:21,000 --> 00:24:29,000 Have any input from obviously from the board and incorporate that in the presentation and then really get into how can we fund the catalyst fund. 227 00:24:29,000 --> 00:24:35,000 We got to this point last year with council. Council was very supportive of the fund itself. 228 00:24:35,000 --> 00:24:44,000 We couldn't quite get to a point where we were ready to decide on the funding options, but at the strategic planning meeting right after that, council said, bring this back. 229 00:24:44,000 --> 00:24:55,000 We're still we want to consider options and move forward. So I'll go through these at a high level and some of this will be getting out a little bit before council because a lot of these are council discussions we just haven't had yet. 230 00:24:55,000 --> 00:25:04,000 But if you look, we'll go down the list. If you look at the first two and Wayne touched on on the first one, the incentive roll off, these first two are fairly straightforward and easy. 231 00:25:04,000 --> 00:25:14,000 I think they'll be support on the incentive roll off. When we look at that, we already in the general fund itself have over four million dollars that we have budgeted for three agreements. 232 00:25:14,000 --> 00:25:20,000 Other agreements to the policy that have already come for those are existing agreements that we have. 233 00:25:20,000 --> 00:25:26,000 If we don't move it over to the fund, what will happen with those is when they expire, it just goes into the general fund. 234 00:25:26,000 --> 00:25:37,000 And unless you come up with new agreements, that four million becomes three million becomes two million and goes down. What we're saying is we've already dedicated this four million roughly to incentive agreements. 235 00:25:37,000 --> 00:25:44,000 Let's just move that entire four million over to the catalyst fund and you fund and it's not going to report the funds right away. 236 00:25:44,000 --> 00:25:54,000 But as those agreements go away, instead of just going to the general fund bottom line, they go back into the catalyst fund and can be used for that purpose. 237 00:25:54,000 --> 00:25:59,000 It doesn't have to get out of the general fund. We just continue that transfer in the same amount. 238 00:25:59,000 --> 00:26:03,000 That's the first step, which makes a lot of sense for us to to move forward with it. 239 00:26:03,000 --> 00:26:09,000 But again, it doesn't give us that immediate seed money that we would need up front. 240 00:26:09,000 --> 00:26:18,000 One time water and wastewater contribution, we budgeted a million dollars in both our water and wastewater fund for infrastructure investments, opportunities. 241 00:26:18,000 --> 00:26:24,000 We don't use that very often. It could be a developer comes in and there's a line replacement that's needed or something like that. 242 00:26:24,000 --> 00:26:27,000 That's been budgeted for years, but just not used very often. 243 00:26:27,000 --> 00:26:32,000 So not to use those funds, but to say we already have two million set aside in the coming year. 244 00:26:32,000 --> 00:26:38,000 Let's just transfer two million as a one time water and wastewater out to the fund to help seed it as well. 245 00:26:38,000 --> 00:26:51,000 And part of the reason we'll go into the next the next line of why we would say water and wastewater can contribute because the core scientific funds are is the piece that wasn't in the conversation as we talked last time. 246 00:26:51,000 --> 00:27:02,000 A lot of the conversation last year was just based on should we either increase our return on investment, which you see here, or dedicate a portion of our return on investment straight to the catalyst fund. 247 00:27:02,000 --> 00:27:14,000 So I'll get a little background on what is it return on investment return investment is being one of the benefits of being a full service city is we have all of our we have water, wastewater, electric in house. 248 00:27:14,000 --> 00:27:20,000 As as is common with utilities that are run municipally throughout the throughout the state. 249 00:27:20,000 --> 00:27:27,000 We have a return on investment where they pay a percentage of those revenues back to the general fund because they're publicly owned. 250 00:27:27,000 --> 00:27:37,000 So, you know, DMV right now it's a 6% ROI that goes from DMV revenues back to the general fund for water wastewater that's three and a half percent. 251 00:27:37,000 --> 00:27:59,000 Core scientific is the large data center which I'm sure most of you are aware of to varying degrees that came into the city that is in kind of cryptocurrency world, and it has a almost doubles our electric usage for the entire city that is going to bring significant amounts of revenue, not only to DMV. 252 00:27:59,000 --> 00:28:15,000 But to ultimately to general government through the ROI of 6% but also through a franchise fee which are utilities pay of 5% so that 5% and 6% are revenues that would go through DMV straight over to the general fund. 253 00:28:15,000 --> 00:28:35,000 In the conversations we're going to be having with council. We are very hesitant at this point to say we want all that revenue $10 million roughly right now as we're projecting forward especially as we're just starting out there's just in phase one to rely on operating expenses for that money 254 00:28:35,000 --> 00:28:53,000 right now to say we're going to ship 10 million over to the general fund have police salaries fighters, relying on that money. Just because first, we want to see it to full fruition before we get comfortable with that but second, I wouldn't want our general fund to be so relied on any one company 255 00:28:53,000 --> 00:29:08,000 I don't want to rely on one industry one company to that degree. So our thought process as we go into the general to the budget conversations with council is, let's look at this money as we're predicting for the next year and think about all those one time costs that we could do with it. 256 00:29:08,000 --> 00:29:23,000 Relying on operating costs. If we get to that point with council and councils buy in on saying, yeah, we're comfortable with saying we want to look at one time cost, and it does up to $10 million that we want to project in the next year based on the revenue forecast from the data center. 257 00:29:23,000 --> 00:29:39,000 We feel like about $4 million of that 10 million, dedicating to help seed the catalyst fund would make a lot of sense, especially as we're talking about green initiatives and things like that, that are involved in the strategic plan as well so that's going to be our recommendation to council 258 00:29:39,000 --> 00:30:08,000 as we at least start the conversations next week, and you saw it on that the handout that you have on the next slide. I'm saying let's do an incentive roll off. Let's do a one time contribution from water and wastewater, because technically the core scientific is coming from D&E, let's do this $2 million we already have budgeted from water and wastewater, and then $4 million from core scientific, the other options are more recurring, and there is a benefit to having recurring obviously that is more reliable because the core scientific the money is not there we're not going to transfer it all on the first day. 259 00:30:08,000 --> 00:30:30,000 In the next fiscal year we're going to transfer it as we actually get the revenues in the other options of actually increasing our water wastewater ROI dedicating a set percentage of ROI, or saying we want to dedicate a percentage of the property tax that goes directly over would be more reliable sources for the catalyst fund would be more recurring sources for the catalyst funds. 260 00:30:30,000 --> 00:30:46,000 Right now with where we are with the general fund and trying to get our general fund budget together. We're just not comfortable making that recommendation, looking at the city as a whole because we have a lot of constraints we have a lot of new positions, a lot of supplementals that we need for the general fund so thought process 261 00:30:46,000 --> 00:31:00,000 would be we do this one time transfer start to see it, see how the catalyst fund goes and then we can continue to make those decisions as we move forward. So that's a lot of information at a very high level and again, just starting those conversations with counsel, but that's our thought process. 262 00:31:00,000 --> 00:31:16,000 When you see the next slide in the handout of what that would look like to see the next slide. So, here's what that kind of looks like looks like in practice I touch on the incentive roll off, so you see that's not an immediate impact. 263 00:31:16,000 --> 00:31:31,000 Those numbers are basically incentives coming up and they're no longer active. Now, even in FY 23 and 24, there will be a dollar amount there because not all of our incentives hit their goals. So each year there is a savings from those some of that will roll for that's 264 00:31:31,000 --> 00:31:45,000 assuming they had all of their goals in each year, but that instead of roll up does start to be to give you more funding in the latter part of that forecast, or you can see in core scientific and we have some plug numbers in the future years and those would be other discussions 265 00:31:45,000 --> 00:31:56,000 about these one time infusions from the data center revenue would help us to build the fund. As you move forward, and you can see that $2 million that we would take from water and wastewater as well. 266 00:31:56,000 --> 00:32:08,000 So, really, look at the first year 4 million is essentially coming from DME who do core scientific and their percentages, and the 2 million from water and wastewater so that's what he touched on earlier utilities paying into this. 267 00:32:08,000 --> 00:32:21,000 That's where you get the utility revenue, and then the top line really, you know, is $4 million from the general fund that's going toward that as well so you have both pieces as we move forward. 268 00:32:21,000 --> 00:32:29,000 So that's, that's it on the presentation and where we are right now as we go forward to counsel and the funding options. 269 00:32:29,000 --> 00:32:40,000 customer on that last slide. Can you help me understand the annual contribution line in the out years. 270 00:32:40,000 --> 00:33:04,000 Is that dashes or hyphens, and then like for instance, 3132, you know, not having 72000 and then the total on the bottom. Where's the additional cumulative. Yeah, that's really confused by annual and then I'm not understanding that one. 271 00:33:04,000 --> 00:33:16,000 I was trying to say the same thing to me but what it is is what's available if we don't really commit it because so if you started 2490 plus 190 is 280 plus 331 is 611. 272 00:33:16,000 --> 00:33:34,000 So what it is is the money that would be there, and it goes uncommitted each year it would start to fund balance. Yeah, that's what you're trying to figure out and not a contribution, which ends the net last year with adding which comes in new money, right, I guess you're assuming that we don't commit it in the year is what the total would become. 273 00:33:34,000 --> 00:33:39,000 Thank you for doing the math. I was trying to figure out. It took me a while to figure that out. 274 00:33:39,000 --> 00:33:55,000 So essentially what this is summing up is this stream of funding here right so these are the roll off right and so, so annually so these we got our one time payments. 275 00:33:55,000 --> 00:34:15,000 Come to six to and then as we come here we're building that year and then this is building the the roll off so that by the time we get to 3132 we've got 4 million annual contribution going into the fund. 276 00:34:15,000 --> 00:34:41,000 Well, the incentive roll off is recurring. Right. So basically after you get past those one times. It's just showing the recurring kind of building up because I think it looks kind of funny on this on this sheet when you do it because say 2029 we showed 574 as the incentive roll off, but assuming let's assume you didn't do any other agreements you would really have the 1.73 from your incentive roll off. 277 00:34:41,000 --> 00:35:10,000 Cumulative of the previous years. Okay. It's so much money they're putting in new each year. Right. So it's not a fun balance which kind of looks like. Yeah, yeah, in theory, right. We're not going to use all of our incentives right so the fund balance should actually be building and we'd actually have more available annually as long as we're not because we're not going to expend all those of all those funds that first year so the balance is actually going to be a little higher but you know I agree that. 278 00:35:10,000 --> 00:35:39,000 This is where you know it could the balance could get a little thin right because if we've we've made some investments here and then we're only got this much coming in you know annually to help build a fund up that I think there's a more better way we can say maybe just we'll just think about how I'm understanding it now you're telling me that you're explaining it for me but I don't want that to be a hurdle. 279 00:35:39,000 --> 00:35:50,000 Question. So, um, first of all, good job I think it's a great presentation and I think this is tremendously needed in Denton so I hope you get the support you need from council. 280 00:35:50,000 --> 00:35:55,000 I'm curious maybe from the historical perspective. 281 00:35:55,000 --> 00:36:09,000 Why are you recommending these two or at least three versus what many cities do as a percentage of taxes, for me, well, do you think you'll get support for more likely to get support for these. 282 00:36:09,000 --> 00:36:25,000 So the four A four B would take a election by the voters to get those and right now, right now we have, you have one cent that goes straight to the general fund for every city, basically and then you have another cent that can be allocated in different ways right now we have since it goes to general fund there 283 00:36:25,000 --> 00:36:54,000 goes the general fund and then a half percent percent that goes to general fund and a half percent that goes to DCTA. So we would, to do any change we'd have to have an election. And this is where I think that we talked about the order a few times, we could do it all at once or not, but it would have to rescind either was likely right the general fund, half percent, and then both to have that half percent to go to sell the sex it was just, it would be a more intricate process to get there, versus these other options or options that we can take. 284 00:36:54,000 --> 00:37:02,000 Just in the next budget year. Does one get you a better longer term outcome, I mean obviously percentage of taxes. 285 00:37:02,000 --> 00:37:16,000 I mean, you can make an argument easily for property taxes growing from an economic development investment but does that get you more in the long run if you go more intricate or do you feel like early ones will help build the culture of support around it, you know what I'm saying. 286 00:37:16,000 --> 00:37:32,000 If we were looking at the cows in isolation. I think you would say a percentage of property tax or some recurring source where we say we're going to, because property tax is different than sales tax property tax is something you could just come up with an informal policy or formal policy, 287 00:37:32,000 --> 00:37:46,000 where you're going to dedicate it where you can rely on a revenue source, that would be the, that would be the best source of revenue for this fund most reliable. We have those larger conversations with counsel on how to look at the general fund and everything else. 288 00:37:46,000 --> 00:37:58,000 So, knowing that we have in this unique situation where we have a large amount of money coming in projected that we just aren't quite comfortable putting the operating costs that we have for one time costs. 289 00:37:58,000 --> 00:38:12,000 That seems like a good opportunity for us. And if I could piggyback another reason why cities prefer to use the sales tax, because you can look at Roanoke as the example where they, they're comfortable using sales taxes a lot of times that causes and being 290 00:38:12,000 --> 00:38:28,000 in my residence where it's property tax is where you can, you know, there's some strategies Frisco that's what they do with their mall and everything right there for counting on that regional draw to help funds from their economic development efforts. 291 00:38:28,000 --> 00:38:49,000 Yes. So, thank you. I guess one of the things I'd like to ask is, can David can you send the last conversation. Can we find that meeting, so that this board understands when it goes to counsel where we were we got bogged down for those, those those pain points. 292 00:38:49,000 --> 00:38:53,000 And then two. 293 00:38:53,000 --> 00:39:04,000 I think what would be helpful if you, Wayne maybe before then could send out, and it may be bigger than a one page of it, but those that did not track along. 294 00:39:04,000 --> 00:39:10,000 Sherman was able to land who was that they landed they maintained. 295 00:39:10,000 --> 00:39:18,000 Yeah, the silicon wafer. So they already had. Right, and they're trying to maintain it. And if you didn't look at all the intricacies that went into them just keeping what they had. 296 00:39:18,000 --> 00:39:31,000 I mean Ohio was trying to, Ohio and offered the world. I mean it was unbelievable so I just think that that background information for this group and for counsel is helpful to understand. 297 00:39:31,000 --> 00:39:41,000 I mean when you talk about competitive that that doesn't capture it. I mean it is absolutely a blood sport. And to your point it's all hands on deck I mean Texas got involved. 298 00:39:41,000 --> 00:39:55,000 The county got involved, and they barely kept what they had. So I think just from that that historical look at it, and kind of what the markets doing now is really important. 299 00:39:55,000 --> 00:40:11,000 And then, lastly, I just, do we, do we, does this, do we anticipate getting above the $27 ever or is it right. 300 00:40:11,000 --> 00:40:29,000 I would love for that to go up but I'm what I think what I'm trying to show here is that this is the ask right for this one time general fund is say what we're asking relative to that blood sport to that competition is probably one of the lowest in the state so absolutely 301 00:40:29,000 --> 00:40:42,000 I would love to come back and ask for more but I think also, what we need to do is to make sure that we're showing that if we get these funds. We're going to make those investments. Okay, we're going to invest them into the community and we're going to, you know, hopefully 302 00:40:42,000 --> 00:41:00,000 build some trust, show our results and then we can come back and absolutely I mean, as long as I'm here. I like to come back and have that number. I'd like to see it at least at the 94 with our, you know, Louisville being our, you know, our county competitor, I think we can do just as well as Louisville one day. 303 00:41:00,000 --> 00:41:14,000 But yes, yeah, no, I mean, because I mean, those, I mean, thank you for the comparison groups but I mean, when we're locked in with Buddha, Cleveland League City. 304 00:41:14,000 --> 00:41:21,000 And we're, we're a lot below them. That's not good. I mean, that's just, that's less than great. 305 00:41:21,000 --> 00:41:35,000 So, thank you for that. Yeah, absolutely. Yep. I agree and I think the fact show. I think we all know anyone that's been on this, you know, border been listening to economic development conversation and Denton knows we are woefully behind. 306 00:41:35,000 --> 00:41:49,000 And, you know, looking at even projected timeline with what we're asking for, you know, how long until we become really competitive. We still have a ways to go. However, what it sounds to me like is, we're trying to take baby steps. 307 00:41:49,000 --> 00:42:07,000 This is just not something that's had a good understanding from a segment of our community or leaders and so I think it's important and I really think the comparables speak for themselves. 308 00:42:07,000 --> 00:42:24,000 It's, it's not fuzzy. It's not moral I mean it's just, this is where we are and trying to attract the best jobs for our citizens and trying to attract more sales tax to try to provide the services that are woefully necessary in our city so I totally agree with what 309 00:42:24,000 --> 00:42:38,000 you're saying. I think we're trying to get a foot in the door and my hope is into the point, you know, my hope is that this can continue to change as people see and understand the math and understand incentives and understand, not just incentives but 310 00:42:38,000 --> 00:42:52,000 everything that encompasses economic development, and can see what fruit it can bring to our city which, I mean, we need the money, you know, so that's my take on it, Mr Ramsey, did you have a question or comment. 311 00:42:52,000 --> 00:43:05,000 I think it's a great way to get it funded in the beginning to get it started but I don't think this plan has any sustainability to it. As far as long term by just rolling those over, we really need to make sure this right and they're presented or present 312 00:43:05,000 --> 00:43:22,000 they're not wrong, but presented like Councilman Davis said, I think this is not, when you look at this representative of what the funds are really going to be long term so I think we need to make sure this is where you can tell what that is. So, I think we got to open the 313 00:43:22,000 --> 00:43:37,000 door, we've had a hard time cracking this door open for years. So I think this is a good way to crack the door. Let's put a wedge in it, and then let it be known and hey this isn't sustainable, right, we're going to have to continue to come up with plans to be sustainable 314 00:43:37,000 --> 00:43:53,000 like Mayor said, you know, we're a third of the almost the lowest one, so it's like, you know, going to a baseball game and having a glove but without a bat. And so, but it's a step right we're getting the door cracked open, I think we have to figure out how to make this 315 00:43:53,000 --> 00:44:08,000 happen. One thing I would point out and maybe count on you to discuss, you know, we've been having all of our property tax evaluations around Denton, you know, we spend a week, week with those guys, and our property tax valuations have gone through the roof so obviously 316 00:44:08,000 --> 00:44:11,000 that's going to mean more income to the city. 317 00:44:11,000 --> 00:44:27,000 And I know it's the cost to run a city's gone up just like a cost to run any business has gone up. But there's probably some additional funds that maybe we could talk about with just values going up in 24 months, you know what property value 24 months ago to what 318 00:44:27,000 --> 00:44:34,000 they are today. That's a lot of revenue. If we can get it counted through our, but that's another subject. 319 00:44:34,000 --> 00:44:49,000 If we can know what those funds are for you to budget. But, hopefully, we can get that figured out and but I think there could be dollars there long term that we could pay attention to that should be brought up and discussed what's happening 320 00:44:49,000 --> 00:44:53,000 with all with the extra funds that are coming in through property. 321 00:44:53,000 --> 00:45:05,000 Maybe those are some discussions that could be had. Obviously, your expenses in the city are going through the roof, and every turn just like everybody else, but just something to think about. 322 00:45:05,000 --> 00:45:14,000 And I don't know how long our DCTA contract is I know that's a real sore subject, but I don't know what that contract looks like either long term. 323 00:45:14,000 --> 00:45:25,000 Perpetual so far. 324 00:45:25,000 --> 00:45:29,000 Questions or comments. 325 00:45:29,000 --> 00:45:45,000 Just to just to pick up on when you left just as a, as a, just you to understand that appraisal component for those that are wondering, and this is just housing so it's a little off target but but kind of online with with appraisals and kind of funds 326 00:45:45,000 --> 00:46:00,000 coming in. The latest didn't County Habitat for Humanity just turned over the keys to their 106 home last week. It appraised at $320,000. That's an overage that's about 1600 square feet. 327 00:46:00,000 --> 00:46:04,000 So, it is. 328 00:46:04,000 --> 00:46:11,000 Is it on the square. No. 329 00:46:11,000 --> 00:46:25,000 I asked her specifically it went up basically from the 105th home to 106 round numbers a year, went up $100,000 and it's in the lower it's in Southeast at the lowest, the lock cost 80 K. 330 00:46:25,000 --> 00:46:37,000 And that same lot anywhere else probably cost you 160 so I mean, they are being very responsible with my it just that those appraisals, I mean, business, everything. 331 00:46:37,000 --> 00:47:00,000 It's just so that we track through the title company what our average closing is, you know, throughout by monthly basis, and it's grown considerably, the average closing amount now the number of closings have dropped over the last few months, considerably, but the average closing amount over the last 20 months. 332 00:47:00,000 --> 00:47:07,000 It's substantial substantial I don't know if that can be sustained. 333 00:47:07,000 --> 00:47:15,000 Long term, but for the short term, hopefully we are getting some additional funds for all of the needs. 334 00:47:15,000 --> 00:47:17,000 Any other questions or comments. 335 00:47:17,000 --> 00:47:38,000 Yes, Councilmember, I think, I think it would be helpful for this group to either, either today doesn't have to be today, or in communicating with city council to articulate what is why these funds are necessary like Joe said there's a, a lack of understanding 336 00:47:38,000 --> 00:47:57,000 exactly how the funds could be used. There's kind of a little bit of a failure of imagination of how the city could make use of the funds and what benefit that brings the, like you said, it's a simple story in the world to say we invest in certain things and you're going to have higher tax revenues later on. 337 00:47:57,000 --> 00:48:10,000 But it's it's difficult for some members of council I think to make that that lead that intuitively from. Yeah, sure that sounds good on paper. What does that mean for the city and why is that. 338 00:48:10,000 --> 00:48:16,000 Why shouldn't we be putting that core scientific money into something else why shouldn't we be buying more fire trucks with it. 339 00:48:16,000 --> 00:48:27,000 It's gonna of course make the pointer stop and make the point about the reason we can't rely on that money why you can't depend on that for buying the fire trucks and bands hours and that kind of stuff. 340 00:48:27,000 --> 00:48:46,000 But in concrete example, maybe that's not a good term, but maybe hypotheticals, you know something about some illustrations might be helpful. If there are things that y'all have seen in other communities that you know or projects you've been involved in and you've seen in other communities. 341 00:48:46,000 --> 00:48:57,000 This is how they spent their money and look at this wonderful thing. You take names off of it, you take brands off of it that makes some some hypotheticals that the council could really wrap their head around. 342 00:48:57,000 --> 00:49:11,000 I think that failure of imagination is where we've where we've missed the vote before is just they're going to have folks in their ear that tell them these are corporate handouts this is money that goes to businesses that we don't necessarily need. 343 00:49:11,000 --> 00:49:24,000 But now we've got a strategy. Now we've got these identified sectors. We've got targeted places we can spend the money. What do those kind of firms need? What do those kind of firms need to be in debt? What do we need to do? What do they need to grow those firms in debt? 344 00:49:24,000 --> 00:49:33,000 And that explaining it for the council in that way might be helpful and this group might be a good source of some of those examples. 345 00:49:33,000 --> 00:49:44,000 So we have some software, some models called Impact Data Source and so let me bounce back to this. 346 00:49:44,000 --> 00:49:59,000 It's a public benefit. So we have a model that can do this kind of physical impact, right? So we can do things that would just show you direct and indirect tax revenues directly to the city on a catalyst project or to all the taxing entities. 347 00:49:59,000 --> 00:50:09,000 And then I believe we have a model that could do some economic impact. So investment within the private sector kind of show you, hey, what would this project look like? 348 00:50:09,000 --> 00:50:26,000 And then, of course, these other things, these would be like more of our double bottom lines, but we can certainly put some hypotheticals, some examples together to kind of show how if we were to invest in certain projects, what that would look like fiscally. 349 00:50:26,000 --> 00:50:37,000 Councilman Davis, I think we have the number one example right here in the city that nobody's going back and looking at and going, we won and that's Western Boulevard. 350 00:50:37,000 --> 00:50:46,000 I mean, you look at the city went out and built part of the road, just a piece. They ran a water line, got power out there, not the fully developed condition of any of it. 351 00:50:46,000 --> 00:50:58,000 We did and it's an incentive on the first buildings that were built out there, you know, as a joke. And then we, it was our buildings in the beginning and we were able to prove rents and prove market. 352 00:50:58,000 --> 00:51:04,000 And then you look at what the city originally invest in the water line and the road and the power. 353 00:51:04,000 --> 00:51:10,000 Then if we measure that to the value of the tours that came back through the original tours, it wasn't on our part. 354 00:51:10,000 --> 00:51:19,000 I think if we measure the return from when that started, I think it was probably 10 years ago to what the tax value is and the inventory guy. 355 00:51:19,000 --> 00:51:26,000 I think we've done the perfect project out there right here under our nose and we've not celebrated it at all. 356 00:51:26,000 --> 00:51:32,000 I mean, for the vision of the city, just erode late, but it's a wonderful success. 357 00:51:32,000 --> 00:51:42,000 And we're not, I think for our EDC that long ago, our city council from that long ago, you know, I don't know exactly when that started, but it's a win. 358 00:51:42,000 --> 00:51:50,000 And we're not and we need to celebrate those wins and go back and analyze that. You guys may have done that already, but it's been a win, correct? 359 00:51:50,000 --> 00:52:02,000 Speaking to Winko, Winko decided to take on all of phase one improvements in our tax increment reinvestment zone, the West Park terms. So we've reimbursed them. 360 00:52:02,000 --> 00:52:08,000 That's the only time we've used the utility fund we talked about here where you have 1 million for water and 1 million for wastewater. 361 00:52:08,000 --> 00:52:14,000 We reimbursed them 1.8 million for that project and that was awarded in 2015. 362 00:52:14,000 --> 00:52:19,000 We do have like a net revenue report that gives you the return on investment and that particular project's included. 363 00:52:19,000 --> 00:52:29,000 We haven't looked at it for all of West Park. Yeah. I mean, if you look at it from Airport Road to 380 and what the incentives and what the spend, I think we've done a great job. 364 00:52:29,000 --> 00:52:35,000 And I think that's the perfect example of what our city can do. And I mean, that's just an industrial. 365 00:52:35,000 --> 00:52:44,000 I mean, there's been stuff done downtown that there's been. So we have a lot of projects right here that we could use and say, look, this filled up. This is great. 366 00:52:44,000 --> 00:52:51,000 So I would start right here with projects in our city that have success and we've done three or four of those. 367 00:52:51,000 --> 00:53:00,000 And so I'd be happy to visit with anybody that asks questions and from downtown projects to industrial and just help just have a conversation. 368 00:53:00,000 --> 00:53:07,000 It's just lunch or coffee and how that goes through. 369 00:53:07,000 --> 00:53:27,000 Yes, I have a question. So a couple of thoughts taking a page out of like an Austin page, but would there ever be a chance for this committee to request a hearing with the council members and say, maybe it's something you don't understand the implications or we'd like to share implications. 370 00:53:27,000 --> 00:53:31,000 I don't know if that's something that they would ever entertain. 371 00:53:31,000 --> 00:53:39,000 So one thought, I mean, and I think many of you know, like, I work, I'm working a lot on our new campus opening in Frisco. 372 00:53:39,000 --> 00:53:49,000 And so I was part of the committee that helped move to Frisco and what the incentives were, you know, required and the engagement from the state and, you know, all of that. 373 00:53:49,000 --> 00:53:56,000 I mean, I'm happy if there's ever a role the university can play in helping share these examples. 374 00:53:56,000 --> 00:54:07,000 And then another question is, I guess how much this is just my misinformation, but how much is the city council not wanting not understanding, but maybe not wanting. 375 00:54:07,000 --> 00:54:19,000 I mean, when I went to that 24 division, I saw a lot of folks saying, keep deaf and small. Right. I mean, if they're just direct opposition to growth, or is it just a lack of understanding because I think those are two different. 376 00:54:19,000 --> 00:54:30,000 I think that you're going to get yes, 10 people are going to get 10 different answers, but I think that the double bottom ones are the most important to some city council members. 377 00:54:30,000 --> 00:54:34,000 I think others are going to see the. 378 00:54:34,000 --> 00:54:41,000 The benefit of the single bottom ones, and I'm just kind of using Wayne slide to break it down. 379 00:54:41,000 --> 00:54:51,000 Some folks are going to be very motivated by they're going to understand intuitively understand, you know, more money in spend a little to get a little to get more. 380 00:54:51,000 --> 00:54:58,000 They're going to understand shifting the tax base off of residents and on to more commercial. 381 00:54:58,000 --> 00:55:07,000 Others are not going to be motivated by that at all. They're going to be more concerned about growing existing small businesses, maintaining existing small businesses. 382 00:55:07,000 --> 00:55:20,000 Keep that in all that kind of stuff. We can have both like there's not you don't have to knock down downtown to build good industrial and good infrastructure for good logistics, all that kind of stuff. 383 00:55:20,000 --> 00:55:28,000 You can do both. It's just a matter of helping them understand the mechanics of doing both. 384 00:55:28,000 --> 00:55:37,000 The, again, there's seven of us. Yes, seven of us. You need seven different answers, and sometimes you get contradictory answers. Sometimes you get I want to keep getting exactly how it is. 385 00:55:37,000 --> 00:55:46,000 OK, so we got to pay the firefighters to keep here, you know, and the growth happens and you can't stop the growth. 386 00:55:46,000 --> 00:55:52,000 And how do you make the debt and culture apply to everybody who wants to be here? You want people to be here, but that means growth. 387 00:55:52,000 --> 00:56:07,000 So I think a variety of examples, you know, kind of a diversified examples, a downtown example would be helpful. 388 00:56:07,000 --> 00:56:17,000 You know, how do you how do you do something that enhances the historical and cultural viability and vitality of downtown? 389 00:56:17,000 --> 00:56:25,000 There's an example for this fund there. Something something that helps them hit each of those different set of different places. 390 00:56:25,000 --> 00:56:32,000 Did I answer both your question? And then I don't know what here. Is there any way for us to help better? 391 00:56:32,000 --> 00:56:42,000 You asked the question, like, how can this board, you know, sit down with council members, maybe it's individual lunches, coffees, if there's a hearing, I don't know. 392 00:56:42,000 --> 00:56:47,000 What's the best way to assist in moving this forward? 393 00:56:47,000 --> 00:56:53,000 Well, one, moving forward. So this board has to make a decision to recommend this board to council or not. 394 00:56:53,000 --> 00:57:03,000 Two, I think it would be helpful to build some personal connections, even just drop in an email to council, you know, with the board, the board considered this. 395 00:57:03,000 --> 00:57:10,000 This is something we talked about. This is the expertise that I, as a member of the board, brought to the table and why I personally supported it. 396 00:57:10,000 --> 00:57:19,000 I just want you to know I'm here for questions and let you know how this affects my industry or affects industries I work with, affects firms that I work with. 397 00:57:19,000 --> 00:57:30,000 Knowing that they have that kind of resource because the council does, does reach out and make use of those kind of resources to help us understand. 398 00:57:30,000 --> 00:57:43,000 I can't think of one of us that is in an industry quite like the ones that all we are in. So as lay people, it's really helpful to have that lifeline. 399 00:57:43,000 --> 00:57:46,000 That phone friend, I guess. 400 00:57:46,000 --> 00:57:56,000 The other thing, too, you mentioned a hearing. There may be a time, and I kind of need to defer to staff on this, but there may be a time where a joint meeting could be appropriate. 401 00:57:56,000 --> 00:58:04,000 We're a big group already. Council is another seven. It's difficult to do, but we do joint meetings with, like we're going to have one with P&Z, DISD. 402 00:58:04,000 --> 00:58:17,000 There may be a time where that's appropriate. I don't know. We've done a couple heavy lifts already with the investment, the strategy and those kind of things. 403 00:58:17,000 --> 00:58:30,000 Maybe something like that could work out. I think right now the personal contact is probably the best. Just reaching out. Here's why I support it. Here's what there is that's good for Denton in it. I'd love to talk with you more about it. 404 00:58:30,000 --> 00:58:33,000 And the timing of that would be after next Thursday? 405 00:58:33,000 --> 00:58:50,000 Next Tuesday. I think that would be the key. Let's see how the work session goes on Tuesday. I would just make one other point to the earlier conversation. When we talk about the divergent views on council and the different philosophies, I think what you saw in the presentation is we kept tying back to the strategic plan. 406 00:58:50,000 --> 00:59:10,000 The strategic plan took us on a lot of the things Council Member Davis said on the different priorities. It had unanimous support on council. Even as we went forward with the Incident and 380 policies, we're tying the strategic plan with the goals. That's why we want to tie everything to the strategic plan because we feel like that document navigated a lot of the conversations we're having to get those goals. 407 00:59:10,000 --> 00:59:23,000 So the more we can tie it to that, the examples are great. You will kind of think through that. Obviously you need your help with those. But the more we can tie it to the strategic plan that has the support from the council and the community, it is going to be important. 408 00:59:23,000 --> 00:59:44,000 And to piggyback off that, we'll keep using the term "incentive." I think sometimes the thought is, well, it's an incentive just to have a company come here, but development and companies may come here. What the incentive is, is we want to make sure we're getting the types of investment that the council, that the community wants. 409 00:59:44,000 --> 01:00:01,000 And so that's why the incentive is key. If we don't have the incentive, then maybe we get the kind of development that it doesn't want because development, we're growing and development will happen. And the incentive helps pull in the direction that the community wants. 410 01:00:01,000 --> 01:00:15,000 So that kind of ties into all that, especially on the double bottom line. It's like we can make that happen if we want to. I think it's important to say, you know, you can't stop growth. 411 01:00:15,000 --> 01:00:29,000 This is the United States of America and people can buy property and come here. What economic development is doing is trying to attract the best, the best for what we have determined we want in our community. 412 01:00:29,000 --> 01:00:43,000 And there are parameters as far as what we're looking at and who should be receiving that and who we want to attract. And so it's really just getting to pick versus just seeing what happens. 413 01:00:43,000 --> 01:01:01,000 We have discussed also some training on the different types of incentives. What is a, what is a city saying here's money and then what pays for itself as it goes. If we could get something put together, because you know council members change, this board changes, and it takes a lot. 414 01:01:01,000 --> 01:01:15,000 I'm in this business every day, and I still don't have a full understanding of every detail. I have a 10,000 foot model, but I think that would be helpful. Some quick guides to say these are pay along the way incentives done by performance. 415 01:01:15,000 --> 01:01:29,000 These things are things given, you know, as a direct cash incentives, just some kind of quick guide that people can refer to so they understand the difference because if you're not in this every day, it's a hard thing to understand. 416 01:01:29,000 --> 01:01:32,000 How that's working. 417 01:01:32,000 --> 01:01:42,000 Well, at this point we do have the choice to make a recommendation in support of the staff's recommendation to take to council. 418 01:01:42,000 --> 01:01:45,000 So at this time, do we have a motion. 419 01:01:45,000 --> 01:01:47,000 Make the motion. 420 01:01:47,000 --> 01:02:02,000 All right, it's been moved and seconded that we make a recommendation to city council regarding the economic development catalyst fund for incentives and adopting the recommendation of the staff has presented today. 421 01:02:02,000 --> 01:02:07,000 All right, unless there's any other discussion we'll take a vote. 422 01:02:07,000 --> 01:02:10,000 All those in favor please signify by saying aye. 423 01:02:10,000 --> 01:02:13,000 All those opposed, please signify by saying nay. 424 01:02:13,000 --> 01:02:19,000 Any extensions, and the motion carries. Thank you for the very good discussion. 425 01:02:19,000 --> 01:02:23,000 And thank you Wayne for the great presentation. I think facts. 426 01:02:23,000 --> 01:02:34,000 Numbers comparables are just what they are and I think are incredibly helpful to tell the story of where is versus where we would like to be. 427 01:02:34,000 --> 01:02:41,000 It's a really easy way to get introduced. 428 01:02:41,000 --> 01:02:48,000 I would not have made it to this meeting. 429 01:02:48,000 --> 01:02:57,000 All right, we'll move on for items for consideration. See, and that's EDP 22 dash 048 staff reports. 430 01:02:57,000 --> 01:03:11,000 And are you doing the respective activity report? Good morning Dan Rosenfield partnerships for the economic development. I just want to commend Wayne, Eric and Jason. 431 01:03:11,000 --> 01:03:18,000 As we are out marketing and attracting new business, it's really important to have the tools like catalysts. 432 01:03:18,000 --> 01:03:25,000 So I want to commend the hard work and especially Wayne, getting right down to it and putting forth a really great program. 433 01:03:25,000 --> 01:03:33,000 In the past month, we've had 27 new leads of different companies looking at 18 active projects are currently moving through the pipeline. 434 01:03:33,000 --> 01:03:41,000 And then in the past month, we've also had 15 investor and business engagement business in terms of our marketing efforts. 435 01:03:41,000 --> 01:03:49,000 So we're doing a full redesign of the EDP website, which will help tell the EDP story and revamping all of our print and digital marketing cloud. 436 01:03:49,000 --> 01:03:59,000 So hopefully as we're out meeting with businesses, as the cities meeting with businesses, we can have a really good positive image and consistent professional image that we're sharing. 437 01:03:59,000 --> 01:04:05,000 We're also working with several different community organizations to help tell the economic development story. 438 01:04:05,000 --> 01:04:21,000 Around the Metroplex brokerage and development community, so people know about Denton and we're helping to engage different developers, brokers and companies about what Denton has to offer. 439 01:04:21,000 --> 01:04:38,000 And then in terms of workforce development, some of the things that we're doing, we've already met with the NCTC, TWU and UNT career centers in the past month, improving that relationship and identifying how we can pipeline from UNT, TWU and NCTC graduates to helping us stay local. 440 01:04:38,000 --> 01:04:41,000 So working on several different initiatives with all three universities. 441 01:04:41,000 --> 01:04:45,000 So, yeah, thanks. 442 01:04:45,000 --> 01:04:49,000 Thank you. Any questions? Thank you very much. 443 01:04:49,000 --> 01:04:51,000 Oh, one quick little brag. 444 01:04:51,000 --> 01:05:00,000 Steve, Medical City Denton had their endovascular surgical suite open in the past two weeks. 445 01:05:00,000 --> 01:05:03,000 Yeah, four million dollar investment, so I appreciate you. 446 01:05:03,000 --> 01:05:05,000 That all goes visit? 447 01:05:05,000 --> 01:05:07,000 Yeah. 448 01:05:07,000 --> 01:05:10,000 Sign up for your test today. 449 01:05:10,000 --> 01:05:15,000 I think I know what vascular means, I don't know what endo means, so. 450 01:05:15,000 --> 01:05:16,000 Congratulations. 451 01:05:16,000 --> 01:05:18,000 Yeah, thank you. 452 01:05:18,000 --> 01:05:25,000 Moving to staff reports to 2022 EDP board member appointment process memo. 453 01:05:25,000 --> 01:05:29,000 Lots of words for what comes next. 454 01:05:29,000 --> 01:05:39,000 Yeah, so, so, as you guys know, this, this board consists of 12 members, three ex officio. 455 01:05:39,000 --> 01:05:47,000 So we have the various makeup of the board. 456 01:05:47,000 --> 01:05:51,000 So in June of twenty, twenty two, one position was vacated. 457 01:05:51,000 --> 01:05:55,000 So that was Tina Albert over with Peterville. 458 01:05:55,000 --> 01:06:02,000 And then Steve is, you know, he is turning out. 459 01:06:02,000 --> 01:06:09,000 And then I believe also Jimmy Meja is not your correct with the Denton Hispanic Chamber of Commerce. 460 01:06:09,000 --> 01:06:13,000 It's also going to be completing his third consecutive term. 461 01:06:13,000 --> 01:06:20,000 So that leaves three positions that are going to be open. 462 01:06:20,000 --> 01:06:48,000 So there needs to be a nominating committee. 463 01:06:48,000 --> 01:06:53,000 So it's two city council members, one chamber member last year was the mayor. 464 01:06:53,000 --> 01:07:02,000 That's Council member Vicki bird and chamber member Morgan Rivers for the chamber of serving as the nominating committee. 465 01:07:02,000 --> 01:07:12,000 And then, so we have various members up for reappointment to, and those are highlighted in the back up as well. 466 01:07:12,000 --> 01:07:18,000 This item is going to be going to Council August 16th, rather than the second, you can fit it on that agenda. 467 01:07:18,000 --> 01:07:23,000 So it's the next agenda. 468 01:07:23,000 --> 01:07:30,000 Okay. Well, thank you very much. That's headed our way. 469 01:07:30,000 --> 01:07:36,000 Anything else before we adjourn this meeting? Oh, I did one thing. 470 01:07:36,000 --> 01:07:46,000 So Dan was pretty enough to kind of give the platoons, but I also want to introduce who started the exact same day as I did there in the back is Jason Westmoreland. 471 01:07:46,000 --> 01:07:54,000 So he's a new member of our staff. So he and I are going to kind of tied at the hip since we have the same start date here at the city of Denton. 472 01:07:54,000 --> 01:08:00,000 So what is your position? I'm the new economic development analyst. 473 01:08:00,000 --> 01:08:02,000 Great. Great. And where are you coming from? 474 01:08:02,000 --> 01:08:08,000 I've been in Denton. Well, I've actually lived in Aubrey most of my life and I've had family in Denton since I've been a kid. 475 01:08:08,000 --> 01:08:16,000 So I've been in Denton for, I guess, twenty five, twenty six years. So I graduated at UNT as well. 476 01:08:16,000 --> 01:08:26,000 So where did you work out for? I worked at actually my first banking job was at North Star Bank, you know, just just like literally across the road. 477 01:08:26,000 --> 01:08:32,000 And then I moved to Guarantee Bank and then that's where I came from here. Great. 478 01:08:32,000 --> 01:08:38,000 We're glad to have you. I look forward to getting to know you. Thanks for your help. 479 01:08:38,000 --> 01:08:43,000 Any other announcements or questions before we adjourn this meeting? 480 01:08:43,000 --> 01:08:53,000 All right. Well, at this time, this meeting of the Economic Development Partnership Board, Wednesday, July 20th, 2022, special called meeting is hereby adjourned. 481 01:08:53,000 --> 01:08:58,000 Thank you once again, everyone, for the discussion and caring about your community.