Jul 08, 2020 Economic Development Partnership Board on 2020-07-08 11:00 AM

All right. Welcome to the July Economic Development Partnership Board meeting. It is 1114 a.m. My name is Marty Rivers. I want to go ahead and call the meeting to order. And our first item up for consideration is to consider approval of the minutes from our June 24th, 2020 meeting. And I would open the floor for any nominations or comments. Hey Marty, it's Tony. I'll move for approval. We've got a motion. I'd like to second. Jill Jester, second. All right. We have a motion from Tony, a second from Jill. I'm going to ask for any comments or questions. All right. Hearing none, I will go around the room and ask for you to say aye or nay, I guess, if you're opposed. And so get ready to turn your mute off. And Chris, you're first on my screen here. Tony? Aye. Jesse? Aye. Mark? Aye. Jill? Aye. And I'm an aye myself. So we have a unanimous vote for approval of the minutes. Thank you so much. And our next item up for consideration is EDP 20-015. Receive a report. Hold the discussion and give staff direction regarding an incentive application for a team of defenders. Good morning, everyone. Jessica Rogers, Director of Economic Development. I am going to turn it over to Erica Sullivan to do the formal staff presentation today. She's giving me a break, very much appreciated on this one. But I will let you know we do have Mark Sierra and Nathan Wright with us. And they are the representatives from team of defenders. So as we get through the presentation, we'll certainly have Mark and Nathan as well as staff available for questions. And with that, I will turn it over to Erica. Okay. Got it. I didn't have to talk last time. Good morning. I'm going to be presenting an incentive application from team of defenders and my name is Erica Sullivan and I'm the economic development analyst here at the city of Denton. The objective of this presentation is to provide information on the team of defenders, provide some background on a tech entrepreneurship initiative that we are working on and consider possible incentive packages. Team of defenders founded in 2018 is an IT platform technology and service delivery company. They are focused on innovation, research and development and deployment. They currently have office space in Stoke but outgrowing their current space and they are poised for growth or in the process of expanding their hub company through offshoot spoke companies. And they're using existing talent pipelines for their current and future staffing needs. Team of defenders is currently seeking investment from private equity investment banks and angel investors. They are projecting rapid growth in value, revenue, customers and employees. One Stoke company storage defender, a smart unit for storage is projected to be in more than 2,500 facilities by 2023. And they have the ability to apply this technology in other areas such as a boat and RV, smart unit storage as well. And they are rapidly adding different spoke companies as they move along. About one per year. The goals of the company are to reduce funding needed from investors to keep more of the company ownership local. And the reimbursement of costs is needed to relocate offices to secure a larger facility, recruit and add additional staff, purchase furniture, fixtures and equipment and make any necessary fiber infrastructure upgrades. Before we move forward, I wanted to provide a little background since we don't normally look at an application like this. Staff has met with team of defenders to understand their needs and their business goals. We've researched similar entrepreneurship, technology and innovation based incentives as well as job based incentives being used across the country. We've attended entrepreneurship, economic development support and building successful ecosystem training. You can see some of the ecosystems in our new strategic plan, our proposed plan. And this has all led to building an entrepreneurship tech based program around our existing policy and funding mechanisms. So we created an application in the early part of this year and then we received our first two tech incentive applicants shortly thereafter. We were going to bring these items forward in March, but were delayed due to COVID and we're moving forward now. The incentive policy has a number of provisions. I'm going to briefly go over how this project meets some of these. One of them is diversifying the tax base, creating quality jobs. In our current policy, we have targeted industry sectors and this particular application meets to the research and development and the information technology. In our incentive policy, we have also identified priority considerations that we will look at and this application meets eight of the 10. Talking about committee investment, diversifying the tax base, promoting public private partnerships, increasing high wage, high paid and knowledge based jobs and encouraging startup and small innovation to promote entrepreneurship and innovation. Under our policy, we also have five programs under chapter 380 grants and loans and this particular application supports for those. Again, the industry sector directly with startup and small business to promote entrepreneurship, also for infrastructure, fiber in this case typically, and then increasing the percentage of jobs paying $75,000 or more per year. In our policy, we also have additional or other considerations and this application meets three, including job based grants. The economic development investment fund was created in 2016 and this program gave us a cash grant. It's paid for by mixed beverage of $150,000 per year that's put into this fund and this allows us to be more competitive with other projects. It's geared towards high wage. It's also geared towards investment and target industries. To be eligible, a company must meet two or three criteria, higher wage or knowledge based jobs. In this case, $55,000 or greater wage for all of the employees or 25% making $65,000 or more. Substantial capital investment, $15 million in this case and then recruitment of industry sector targets. This is the innovation in R&D. You can see the jobs from the application over a five-year period and then summarized it a 10-year period. When we look at economic development, we usually look about over a 10-year period. The current employees are two, but we've just been informed that they hired an additional employee during COVID which is good news. You can see the new employees added through years and then the cumulative jobs of the employees added including the current jobs for a total of 56. You can see the jobs paying $65,000 or more and then you can see which is a 30 and then you can see the jobs paying $75,000 or more. To give you an idea, one of the last grants that we looked at was Tyson and Tyson had 100 jobs and they had 13 making over $65,000 or more. In this table, you can see the wage information, the payroll, the weighted average annual wage. All the salaries are over the Denton County average wage of $45,900. You can see the new, all and incentivized and the payroll as well. To give you another comparison again using Tyson, Tyson for their 100 employees had a payroll of $5.1 million. If you look at all the 56 jobs, this particular project, Team of Defenders, is almost $4 million and it's about half the jobs at 56. The incentive proposal is performance based and it's a business expansion incentive and it combines two main components. The first component is an expansion grant to reimburse relocation cost, fund additional equipment, make necessary upgrades, site finish out and any incremental increases in rental costs from the larger facility and this is all based on demonstrated reimbursed cost. The second component is a stratified job based incentive and this is into four categories and then we are also giving additional consideration for employees living in Denton because we definitely want to encourage that. This will be done via chapter 380 agreement and the economic development investment fund that we discussed would be the source of funds for this and then the agreement would also include a term and a cap on the funding amounts. Here's a table of what we are proposing. You can see there are five years and then they accelerated to 10 and I'll explain that further. Because it's a job based grant, we really didn't want to go over five years. The first item you'll see here is a one-time expansion grant that we discussed and this is $50,000. The second component is the job based grant and this will be stratified from $500,000 to $5,000 reimbursement for salaries greater than $65,000 to $100,000 in the four categories. Then we also include a bonus for Denton residency hiring local residents and then you'll see this accelerated option. We do our analysis on 10 years and our applications based on 10 years and we wanted to give them the opportunity to accelerate and hire additional jobs within the five-year term. So we estimate the total as the five years to be $80,000 but we are actually giving it a cap of $106,000 if they accelerate. Some of the qualitative benefits, I wanted to highlight those. The economic impacts. Typically what we invest in or have invested in in the past is capital, very large facility projects and equipment and this time we're going to be investing in human capital and quality jobs. And this goes along with the pipeline for university training programs and the reduction of brain drain, keeping our people here. This also is a benefit by keeping a Denton startup, by retaining a local company, fostering entrepreneurship, diversifying the tax base, development of an economic system that supports entrepreneurship and locally owned businesses. And then finally the fiscal impact would be less demand on our utility services and infrastructure because it's not a capital heavy project. Some of the quantitative benefits are the economic impacts. The direct impact of jobs created by the event would be $54,000, $56,000 with the current and with the average wage is $68,959. The ripple effects which include induced and indirect impact add another 81.8 jobs with an average wage of $36,254. Property tax, sales tax, utility system revenue generated by the projects and other benefit as well as the attraction of venture capital and investors. Some of the fiscal impacts is the cost to provide government and utility services is low. And then a return on investment using our impact model is $22.2. Our summary and recommendation is again a five year performance based incentive with a total not to exceed 106,500. This involves the expansion grant, which is a reimbursement of actual costs, a stratified job grant in those four categories for a total of 29,500, a possible residency bonus of 500 per employee up to 27,000 if the jobs are accelerated and then we will be verifying this on the IRS form 9-4-1 and the chapter 3D agreement is to be funded by the economic development investment fund. The options and recommendations, the board could approve the staff recommendation, could modify or create a new incentive recommendation or have a no incentive offer recommendation. And I'd be happy to entertain questions. Thank you, Erica. That's a good job. Sorry, I got knocked off the computer there for a second. Anybody have any questions? Raise your hand if you would like to speak. I'm going to ask some questions while you guys are thinking up your questions. Jill, I did see your hand raised there. On the $50,000 initial grant that's for some of the infrastructure, do they install that and we reimburse them? Is that a reimbursement grant? Yes, that will be a reimbursement grant. And is that limited to certain items? Is that furniture, fixtures, equipment? We have, let's see, I may have gone too far back. Okay, so relocation costs, fund additional equipment, which would be your furniture, fixtures and equipment. They could make necessary site upgrades, finish out even incremental increase in rental costs for the new larger facility, but these would be actual costs. So it would be reimbursement. And I'm sure this is going to be our next Amazon type business. But what happens if on the other items, they don't get any of the funds unless they perform this case, they could, we could, and I'm not, no offense, Mark and you guys, but if they're not in business in a year, we've spent $50,000 on moving costs and help somebody finish out an office in somebody's building somewhere. Is there any free course, I guess, or any way that the city didn't, didn't just out $50,000? In the contract phase, we would have a recapture provision where we could recapture typically a portion, like maybe 50%, but it could be negotiated at that time. Okay. In a scenario where we do this with any company though, I guess if something, if they were out of business, their likelihood of recapturing any funds would not be very high. And while I've got the floor, I know Jill's out there waiting on the occupancy, I guess on the employees that live in Denton, is that tested every year or is that tested one time? How does that work? That would be done on an annual basis. All right. Jill had a question. Thank you. One of my questions got answered. So thank you for your very good question, Marty. And with that, I would like to hear from the applicants. First of all, we appreciate you doing business here in Denton and thank you for coming before us today and spending time. I see the connections with UNT, but since we have you, can you talk to me about why you've decided to expand here in Denton and speak a little bit to the community involvement in your planned community involvement? Sure. Absolutely. Thanks for the question. And all thanks for the opportunity here to come and make this proposal. I also thank Jessica and Erica. We've been working with them for a while and they really dug in. It's nice hearing you talk about our business, Erica. That was wonderful. So the answer, Jill, is Nathan and I established our first office back in 2018 at Stoke. The reason we did that is we both, first of all, it resides about halfway between where we live, proximity. But secondly, we have this belief that Denton offers a very unique, we could have went down to Deep Ellum, we could have went to Frisco. There's other places that we could have went, but we like the concept of colliding tech with the creative culture of Denton. And we're looking to create a competitive advantage with our platforms there. So Nathan and I are both degree engineers. Nathan is the CTO of our partnership and then I'm on the business developments that I've moved over. Tech, we've got covered very well, but out in the industry, your real differentiator is user experience. And so we like being part of the community because we believe there's more, a more creative, more in touchness with actual people and that's ultimately it's people, consumers and businesses that are actually purchasing solutions. And we think we have harnessed that and we continue to do so. That's number one, the culture. Two is we have leveraged UNT. We've hired, I'm happy to say that we've hired two UNT grads as interns and made them full-time employees in our software development and we'll continue to do so while we have not been able to find an established internship program. We've done pretty good job working with them and finding what we've needed. And the reason for that is point three is we work with one of the advisors in our company actually is the head of the, Nathan help me what his title is again. He chairs, he's on the chair of the computer and engineering and science advisory committee for UNT. So he's an advisor in the company and we believe working with a first rate university is a great feeder program, but we're also leveraging, we've talked to some of the professors about some of their technology and how we might be able to work with them and use that. And then thirdly, we've been highly involved with UN, NCTC. We love the tech hire grant program. And so I think we have, we're trying to leverage the local universities. We're trying to leverage, of course, and contribute to the culture. We've spoken in at Stoke, we're an active member at Stoke and we've done a lot in the entrepreneurial community. I've done speaking engagements at Stoke and at UNT. We just feel that Denton is a bit special. And, you know, we think that we can also potentially be shapers, not only consumers. Well, thank you. Thank you very much. I'm super glad to have you. My husband's an IT technician. I know all the possibilities that are out there and I'm sure Texas Women's University would love to speak to you as well. There is a lot of opportunity there. And as far as what is the interest in community involvement as far as, you know, giving back to the community, is there anything in the plan for that? Yeah, I mean, I think with us, I mean, happy to talk about that. Number one, there's different ways to give. One of the things that we give is we've hired three people from Denton to work in our company. So we've chosen our most recent hire was well above the minimum threshold. We hired a top developer in Denton. So one is to actually employ Denton residents. That's one way we give to the community. Two, we engage, we do mentoring. We do, you know, like I said, with our interests in STEM and sciences we've done work with young students. We were supposed to do an engagement with what's the name of that program, Nathan, for the high school program at UNT, where high school students go to UNT. I can't think of the name of it. It eludes me where they take in high school students and we were going to host a TAMS. What was that? TAMS. Yes, we were talking to some of the students with TAMS and we were going to have a lunch and learn with them. And again, to talk about tech and to really pour into, you know, the students. And then aside from that, Nathan and I, on the charitable side, we do have a portion of our business that we are going to donate a portion of our profit once we get to profitability to funds that we feel moved to do. And obviously we would expect that a portion of that would go to the community that we're in. But that's part of our bylaws and what we've set up as a company. Really great. Thank you so much. You're welcome. Thanks for the questions, Jill. All right. Anybody else have any questions or comments? Chris? The initial $50,000 was going to come out of that mixed beverage fund. What would the balance be in that fund after this project? That'll be a little under $800,000. Okay. Thank you. $772,780.21. Okay. Any comments? Questions? It's a little bit different than what we're used to looking at and kind of an exciting opportunity. With no more comments or questions, I guess I would open it up to the floor. Our job today would then be to make a recommendation to city council if we so choose. So I would open the floor for any motions recommendations or comments. Marty, this is Mark. I'm happy to make that recommendation and the positive to support this. Okay. We have a motion from Mark that we, I'm going to put words in your mouth, recommend to city council the staff recommendation for the incentive. Yes. Would anybody like to second that? I'll second that. Jill Jester. We have a motion and a second. Any further discussion? All right. I'm going to go around the horn again. Chris. I think that was an aye. Tony. Aye. Jesse. Aye. Steve. Aye. Mark. Aye. Jill. Aye. And Marty is an aye as well. So we have a unanimous consent. John Baines joined you during the presentation. John joins us. Did you get enough of that? I did not. So I'm just going to abstain and allow the majority to vote. Thank you. All right. Thanks for joining us. I saw that. Sorry, I missed you. Thank you. So motion carries. We'll make a recommendation to city council and let them take that up there next or whenever that gets on the agenda. And I want to thank Nathan and Mark for attending today. You're welcome to stick around and enjoy this wonderful conversation we're having, but certainly understand if you have other things to do. All right. Our next item is to, I'm not going to read this whole paragraph, but it's EDP 20-025 and we'll get an update from tip strategies on our strategic plan that we've been working on. And we'll let Tom and Jacqueline take it from here. Thanks for being here, guys. You bet. And can everyone see the slide deck? Yeah, we're going to keep the slide deck pretty brief today so that we allow enough time for any discussion that they actually want to document itself. But I appreciate the fact that Jacqueline and I were able to be included at the first part of your meeting to get to hear the incentives application. We actually couldn't have really scripted it better in terms of fitting within some of the recommendations that were outlined in the plan and are very encouraged that you guys are willing to take that step and kind of get outside of some of the traditional ways of thinking about how you incentivize projects. So that's all good. And if you don't mind, Erica, do you have the slide deck? Okay. Yeah, if you don't mind, go ahead and advance. So I'm going to make a brief reintroduction of the concept of the strategic growth areas. And then I think Chris and a couple of you asked last time if we could gather some information about what some of the other communities are doing in terms of their sales tax and the competitive environment. So we did that and we'll talk about that briefly and then talk about next steps. So the next slide, reminder that the goals accelerating recovery is the first priority based on the current environment that we're in. Second priority is making sure that you don't pause on doing economic development. You continue to market the community around the four different areas that we saw as strategic growth areas. And then the third is that making sure as you go forward, as you think about economic development, you're thinking of it not just how do we fill up the business park, but how do we support the universities? How do we support workforce development? How do we support keeping and attracting talent in the community? Next slide. So the four, a reminder that four growth areas, the first one being the most traditional being transportation logistics. That's where attracting, helping Chris off on Peterbilt, making sure he's got his suppliers, making sure that your business park is in those that are investing, you know, highly from a capital standpoint, creating revenue for the community. Creativity, that's where the incentive application you just heard fits very neatly. Also taking advantage on the sustainability side, the fact that you guys have your electric utility and sustainability has been a goal for the city for a long time. And then that fourth box competitiveness is where, you know, the Class A office space as the coal hunter ranch starts to develop over time, that's where a lot of those strategies would fit. So each one of these strategic growth areas, and Erica, I'm not going to spend much time on each one of these, but go ahead to the next one. Connectivity, the common idea that I'll point out here is this idea that over time you take advantage of what you have going with UNT and logistics and create a kind of a center of excellence around that that includes your employers and other assets in the community. Go to the next slide. Creativity side, I think we've called out EdTech as a particular target for the region based on your educational assets along with technology growth. The next slide. Sustainability, I think I mentioned that up front. Having your economic development sort of align with your sustainable development goals and your current, you know, simply sustainable strategic plan that the city's been working on. The last, next slide. Competitiveness, as I mentioned last time, I think I was asked a question about budgeting and really, you know, you could dedicate one or two staff specifically for the properties along 35 West. Continuing to promote downtown development, that's one of your biggest assets. And as the gentleman applying for the incentives mentioned previously, the culture was a big part of their decision in your downtown, the universities there really capture that culture. And so just making sure that you pay attention to that. And then professional office space, I don't have a crystal ball about how this environment is going to play out in terms of the next Class A office spaces that are built. The guys from Hillwood and others can answer that better than I can. We're monitoring closely what this means in a COVID environment and as we go forward, what the demand for office space is going to be and what that's going to look like. But that still needs to be a part of your areas that you focus on for the long term. Next slide. So I just have a couple more slides here. As we talked last time, we think that in order for Denton to remain competitive while the beverage tax, the $150,000 that you guys are putting into your fund and the $800,000 that you currently have remaining, as you mentioned Erica, are really important. The competitive environment for you guys in order to actually embrace the plan that we've helped lay out here is going to require not only a larger operating budget, but it's going to require what we think of as a catalyst fund so that the right projects that come along. I don't think, I'll show you some numbers here in a second, but competing head to head with Frisco is probably not what you're going to find yourself doing. So you may not need the same cash that they do, but you do need something that's, that at least gets you to the table for some of these projects. And so Jacqueline is the next slide. Go ahead, Erica. If you don't mind Jacqueline, maybe remind folks that we had looked at sales tax and what the numbers look like. Sure. So we presented this a couple of months ago, but this just gives you a sense of some surrounding DFW communities who either have type A or type B sales tax they put into an economic development corporation. So you can see that this sort of EDC structure is commonly used by other communities to help fund economic development, particularly in the DFW metropolitan. So they're surrounded by communities dedicated funds to economic development. Next slide. So this, we pulled some information based off of questions during the last meeting. This gives you a sense of how much revenue is flowing into those economic development corporations for a couple of surrounding communities. You kind of get a sense of the amount that, you know, your, your neighbors are, are devoting to economic development. And then on the right side, I pulled out a summary from, from the Texas Comptroller about type A, type B, and what kind of projects can be funded through those just for extra information. But this gives you a little bit more of a sense of what we're talking about in terms of fund sizes and kind of amounts that other communities are setting aside for economic development. Yeah. If you don't mind, Eric, go back to that slide for just a moment. Yeah. And so, you know, what this doesn't capture is how much some of these communities have in the bank right now. In other words, these are the actual annual revenues that they bring in based on the sales tax. And so I don't think it would be too difficult. Typically the, you know, Frisco, these guys will share with a phone call just what they're currently sitting on. And many times they'll also share what is obligated out of those revenues based on current projects. Just because Allen is bringing in 13 and a half million doesn't mean they have 13 and a half million to spend every year because then they have half of that or three quarters of that already obligated to specific projects. So really you have to pay attention to, you know, what is their net in a year and what they have available to use. But many times they're also, they're also sitting on a significant amount of cash. So just give you an idea of what's out there right now. Marty, can I ask a quick question on this slide? Thank you. Jill Jester. Tom, thank you. This information right here that we're looking at, I assume that this is public information and that's where it was gathered from. Yes, the Comptroller reports out what each group, what the revenues are every year. Okay. I just want to know what information I can share with others and which I can't. Thank you. So another thing to keep in mind is that EDCs like cities have to have CAFERS that are publicly adopted by their boards and city councils. So any of their revenues or funds that they have are publicly available. If you want to read a bunch of CAFERS, Jill. Marty, I have a quick question. Go ahead. Yeah. So on that chart you guys are looking at, it shows two different sources of economic development funds. So I'm assuming you would add those two numbers together and that's the total amount of revenue that each community that you've noted raises and then the way those funds are distributed kind of are detailed to the right of that chart. Is that a good way to look at it, Tom? Yeah, those are the categories that the Comptroller says are how the money can be used from each of those. There is some flexibility to move money toward different projects one way or the other. You can take type B money and use it for type A projects. Sometimes the actual election is required in order to do something or a council vote is required to be able to move the monies around. But typically type A is... Go ahead, Tom. One thing that's not noted, I guess we know the percentage of sales tax that they charge for each type. Is that fairly easy to determine? Yeah, that's also available. They typically range from half a percent down to an eighth of a percent for each one of them. Yeah, gotcha. Thank you. So the last slide, Erica. Move ahead. We'll open it up for discussion. So in terms of the process, I talked to staff this morning. There may be some adjustments and when this would go before city council, but from working with you guys, our hope is to get feedback from you about the plan generally, and then begin working. If you guys are good with the structure, then the next step for us would be to take this and put it into an implementation by matrix that we would then start filling out timeframes. And then we will also take a look at how... We've got a couple of other tasks. One would be to take a look at your current incentives policy and see how that would align with the plan itself and if any adjustments need to be made. Because one of the things that I noted is, Erica, as you were going through your incentives policy, the target industries are one of yours. And so for us, our target industries are structured a little bit differently. And so we would need to maybe make some adjustments there and a couple of other places. But that's a next step for us. But really, that's where we are right now. So if you guys, now that you've had a little more time with the plan, if you have any questions or concerns or things that you think would be nice to have a little more detail here or there, obviously some of that we'll get to when we get to the implementation component of this, which would be the next step for us, if you guys feel like we're on the right track. Marty, I'll hand it back to you. All right, Tony. Yeah. Hey, I would just like to ask Jesse, if he can share with us maybe a little bit of his thoughts relative to the discussions at the city council level on where you guys are, because I'm assuming there's been several meetings over the last few months, kind of the attitude maybe of the city council on this whole project and where it's going and the funding mechanism and those things, if you could share some of that with us, maybe some of it is confidential, but curious your thoughts. Sure. I'll do my best. I have to warn you ahead of time though, I'm going to be, the answer is probably going to be a little disappointing and vague. I can speak only for myself being one of seven members. As far as the overall project, I can tell you that there's enthusiasm on the council for an updated economic development strategy. I know that as these things come up kind of project by project, we're looking for some additional guidance and a better, more up-to-date kind of touchstone for what our overall strategy is, so we can better evaluate individual projects as they come through. As far as a funding mechanism for an ED fund, I think you would probably find seven different opinions on the best way to go forward with that. I have my own thoughts. I'll kind of keep those to myself for now because I do want to hear from my colleagues and really from this group what we think is most feasible and then also, I don't want to go lean real heavy into one strategy and then find out from city staff and the council meets that my bright idea is patently illegal or fiscally irresponsible or whatever, so I can tell you the council would like to hear from this group in a recommendation on this strategy and this plan where you want us to lean in and where you think it needs to lean in and how aggressive we need to be. I personally, y'all know this already, I personally think we need to be aggressive about funding an ED fund, and if this group feels the same way, I think the council needs to hear you on that. If you want to be a little more cautious or less aggressive, then we need to hear that also. Thank you. That's fair. Thank you for that. Good question. I think the overriding consensus, if I could speak for everybody over the years, is that we want more money to do more things with and then how we get there has always been the challenging part of it, so we're capped at, we can't, this may be preaching to the choir, but we can't go add anything more to our sales tax collection because we're spending the money on DCTA, and so we're having to use what we can. The DME suggestion is another alternative way of getting there as well, so probably whatever is the best way for council to think about how to get some funds, but we're way behind the curve compared to what our other cities are doing, and it's pretty sobering to look at that graph and look at some of our neighbors, how much money that they have to deal with and what they can do, so good question. Bring that up. Anybody have any other questions or comments? Chris? That was part of what I was trying to get at last time was looking at what all the competition has at their disposal, and I knew what those numbers were going to look like because we've dealt with many of those cities here in the last few years, and we've expanded into another part of the Metroplex, but the other question that I had last week is, based on that and based on the planet that you're working on here, and I really like it, I finally did get a chance to go through the whole thing. I really think it's pretty solid, but it's not going to do anything without money. It's going to do nothing without money, and so I guess the other question was, based on your experience in similar sized cities, in similar sized competitive markets with cities that have those funds that they do, what should the debt number be? Forget how it will get there, but before you can put a plan together to get there, you got to know what there is, so is there $5 million or is there $10 million? In your assessment, that's got what I was looking for as the second piece. Yeah, and I think that the $10 million number, if you feel like you want to compete on, especially when you get into manufacturing companies, let's, for example, Chris, if you guys had a supplier that was going to create 200 jobs and was going to put in $50 million in equipment and everything else, in the current environment over the next two years, three years, as you know, you probably have this money thrown at you too, it's going to be significant, and that still may not get you in the hunt for a lot of projects, but that's probably a good number to think about, to stretch you a little bit. In the short term, if you had an incremental goal, saying, look, we really want to get to a couple of million dollars in the bank so that we can at least start saying that we have a fund, and if you've got 800 to start with and you need another 1.2 that you thought the utility could put some into and that you could rave some from the private sector and maybe there's some other source out there that we haven't thought of, but having an intermediate goal of getting $2 million in the bank, but your longer term goal being $10 million. And there are interesting strategies we've seen communities put together out there, some of the larger ones typically will call their capital campaign Opportunity Austin, Opportunity Houston, and they will sometimes tie their fundraising to specific efforts, like if they know that marketing is something that is harder for the city to raise funds for specifically, depending on how you're going to do it, that that's a private sector, you know, you end up with some private sector investors who say, yeah, we know if this is going to be used specifically for this fund, you know, this part of what we're doing, we're willing to put money in, or if you're going to fund these types of projects, we'll put money into it. But we're happy to continue as we get into the implementation discussion, providing, you know, more information on what some others are doing and how they're doing it. When you talk about a catalyst fund, that however you get there, is that overseen by the city? Because you're looking at DME city funds and private funds. Currently, we do a little different, we have private funds that fund part of our overall marketing budget. But do you, in this scenario, do private investors, businesses put money into a fund that's then managed by the city? Or how does that? That seems like that would be challenging. Yeah, I know, I'll have to do some more research, Marty, on how to best structure in an environment where you have your utility might be that the funds and the way that they're actually distributed, have some caveats to account for that. So that if city, city money is going to be used as part of an investment, then obviously the city is controlling that. I've also seen, for example, the Greater Houston Partnership, we did a large workforce project for them that was essentially funded from their capital campaign. And they had investors who specifically said, I want my funds to go into the talent development part of that. And so it could be that maybe just get structured that the private sector is going to put up funds that there are some strings attached to how that gets used. But I know, Charlie, you've worked with other groups, too, like Round Rock and others, if you've got anything to add there. Yes, there's, I mean, there's a number of ways that people have done this. And I think Tom's right, we probably need to look at what are the what best fits Denton and how it would operate. But a number of communities do this where, as Tom said, but that money is usually specified for specific purposes in an overall economic development plan. But I'd be glad to pull together some of those in conjunction with Tom to bring back to you. All right. Jill raised her hand. Well, so as far as the input I have, I have a few points. First, I would say that I think the philosophy is is on track. I don't think there's any major red flags. In my opinion, I think you're going to get a consensus that we're in the right direction and let's move forward. Although COVID-19 has slowed some things down, things are still moving very fast in the North Texas area. And we certainly don't want to miss out on opportunities that we might if we slow things down in any way. Second, I would say one of the most helpful things as well as kind of putting these philosophies together is looking at the real numbers and comparables. I think it's going to be very helpful for people that maybe have not looked at the philosophy around economic development to see what our competition is, even within Denton County, to where they could enjoy some of the culture of Denton, but not necessarily do business here because of the opportunities that are set up with these type A and type B funds very close by. So I think some of those and helping us understand what real numbers are just down the street is incredibly helpful for determining what the next steps Denton needs to take. I think in order to stay strategic and intentional, we do need to not take anything off of the table as far as funding for this catalyst fund. So whether that's the A train, whether that's DME, whether that's private investment, I think everything should be on the table and open for consideration, understanding what current disadvantage we are at and competing for the best businesses for our residents and to help sustain our city. And lastly, I would say that I think the sooner the better, as far as moving forward or giving you what you need in order to come forward with the implementation matrix, we as we all know, our contract between the chamber and city regarding economic development has expired and we are talking about what that is going to look like if that continues, if it continues, what that's going to look like. And we certainly are relying a lot on all of this input from all of these different sectors, as well as this report and trying to determine what is best for the city and who should be doing what. So my vote would be to, even if you feel like we're jumping the gun, trying to get that matrix together. I think, like I said, I've not heard a red flag yet as far as what you've put pen to paper and been able to put in a document as far as where we've been, where we are, and where we might be able to go and the way we want to go. So I think that the sooner the better so that we can determine the partnership between the private and the public sector would be helpful. And I just it's been a real pleasure to be involved in the entire process and learn more. And just being a part of I truly believe this is of the utmost importance for the city of Denton. So thank you very much. Thanks, Jill. Any other comments or questions for Tom? Marty, I did have a question, please. Okay. I'm sorry, gang, to come to the party a little late, but we've been without email and without internet for two days. And we put some bubble gum wire and chewing gum together and here I am. So a couple of things. And I know we're not supposed to speak to people directly, but I'm going to do it as gently as I can. Councilman Davis, I would like to see, this is my personal feeling, I'd kind of like to see the council show their hand a little bit. I feel like we're in a poker game and nobody's showing their hand. As far as kind of what we want to do as far as an investment. And I'll elaborate a little bit more. Another example. As a young boy, I lived in a foreign country and I didn't know what to expect there. But when I got with some experienced people, I was able to travel and enjoy the foreign country because I was with some experienced people. And I feel like that right now, we need to do something, but I've never been here before. So I'm relying on the people with experience to tell us how much money do we need? I need a number on the table and possibly a number one, a number two and a number three, as far as an option. Choices. This would be our first choice, second choice, third choice. So I don't know how we integrate that into what we're doing here, but I kind of like to at least have a ballpark of what we think we need and then develop a plan to go and get there. Thank you for allowing me to have that input. >> And Marty, if you don't mind me jumping in. John, I think your points are great. I don't think it's helpful to ask the city council to brainstorm this. I think that we've got a lot of talent in this group and what would be more helpful, I think, to lay this issue out to them and to get their feedback that you're asking for. And I think we all want that. It's not particularly helpful for me as the city manager to see what other cities have to work with. I think that we can put together those dollars. I mean, we're limited by our imagination. Quite frankly, the sales tax from DCTA, it's not coming back to us right now, so we need to kind of ground ourselves in some reality. And I think, Tom, it would be helpful to understand, you know, what you see is really necessary to move us forward the next step or two over the next couple of years. We can certainly put together financing plans right now for the council to take a look at, but they need to know what they're debating and why. You know, and I think if we can structure it that way and get it back in front of this group, just say, look, here's two, three, four different options. What do you think? You want to recommend some things, as long as it's tied up in strategy and projects. And you know, I think it gives Jesse and the rest of the council the ability to jump off. We can solve the money if they want to, but it's just sort of where are you seeing in the implementation plan that our, you know, first few million dollars need to be spent? Where are you seeing that we need to have, you know, that capital fund set aside for opportunities because we can certainly make recommendations to them. And I know that we'll listen to them, but we need to go to them very specific plan. If we don't, it's really not fair for them to sit there. They don't know the budget like we do and some of the opportunities like we do, but as long as we frame it, we'll get that feedback from you. But it's got to be more targeted. You know, what do we need for new companies? Where do you see us, you know, maybe needing to invest in some infrastructure, that sort of thing, and what would be a good starting point? I think this group's kind of gotten tripped up over the last year in terms of how much money that we need and we don't have an option. We have a lot of options that we can offer. It's just what are we trying to solve for? I think we can help you get some compact recommendations for council. And as long as we're going to them with the financial side, sort of, you know, a menu there, I think we'll get them to listen and give you some really solid input. But John, your point's right on, but we have to have that data first to give them, you know, to talk through the options with them. Well Todd, while you and I are talking, I just wanted to say that I was uncertain who was going to put the stake in the ground. Somebody's got to put the stake in the ground and say, this is what we're going to go for. I thought it was the council, but if you're saying it's us as the think tank, I'm more than happy. But once again, I don't really know what's reasonable. So somehow we've got to find a goal that's both reasonable and doable and we'll achieve the goals that we want. So I don't even know how to start that. I think I'm happy driving the stake out, you know, in providing the options. We just need a little more specificity with Tom. This conversation will go nowhere with council if all we do is show them what other cities have to work with. I mean, if we go in basically saying, look, here's our strategy. We've got an implementation plan for the next couple of years. We really need to have X amount aside, you know, in a fund to retain or go after jobs if they present. We've got X amount that we need to invest out there. We'll put the plan together and run it by you. And I just find that you get much better feedback from the council, you know, when they have three or four realistic options where the financing's there. You know, don't forget that this group has got, they go through hundreds and hundreds of things every month. And so the more compact and better we can package it for them, the better the feedback you're going to get from them. So I'm happy to have staff work with Tom, bring something back to the group. We don't need to rush to the 28th of July and maybe next month we say, hey, here's some ideas we had, here's some targets over the next two years, five years, here's some ways we could get there and then run that by you and if you're comfortable with it, get it to council. But I think that thought process there, we just, both the council and the EDP, we get frozen because we're not coming there with solutions for you to respond to. Thank you. Thank you. I needed that. And Jess, if you want to jump in. Sure. I think I'm mostly going to echo exactly what you said. In my experience, I agree with Tom. I think asking council just kind of workshop on this idea would lead us down about a thousand rabbit trails without really converging on a meaningful goal. I think giving us some realistic and attainable options and some ways to get there, some ideas on how to get there. Even, you know, the most out of the box idea I've heard yet is the DME thing. I don't think that we've really truly examined that as a city, but ultimately it's a policy choice, right? The council decides how you get there and they do that with the best advice they can get. I can tell you, speaking again only for myself, but with an idea of who my colleagues are, we are not equipped to have that conversation in the same way that this group is equipped to have that conversation. Bringing something forward to us that leans heavily on Tom's experience and this group vetting out what Tom brings, that puts us in a much better position to make meaningful and realistic decisions. Thank you. Anyone else has any questions, comments? I'm gonna, I guess just to ask Jessica, does there kind of remind us what our next steps are? I know there was a timeline in there. Sure. We're asking for public input right now on the website. So we've, we're hosting an online public comment session in lieu of a community meeting. So we have been pushing out the message on social media saying, community, give us your ideas and your feedback, really focused on, again, the broad general concepts and the ideas that we've put forward to the board. I did talk to Tom this morning and let him know that we were gonna push back the timeline just a little bit instead of rushing to July, that we were likely going to council sometime later in August. What I've heard today is that Tom and Jacqueline and I have a lot of work to do and kind of working through scenarios and budgets and ideas. There's some additional work that I have been doing that I can share with them on that and additional analysis as it relates to kind of possible scenarios. And then maybe that's what we'll bring back to this group at your August meeting and get feedback. Because what I'm hearing consensus generally about the strategies in the plan, what I'm hearing is we need more specificity in particular on the fund and how that fund relates back to the tasks identified in the plan. And so putting actual dollars and cents to some of those tasks and how the, how the fund can be used to help accomplish that plan. So if, if we have a month to work on that, then that's what we'll bring back in August and we can go from there. That was a lot. Does that all make sense to everyone? It does. Thank you. Anybody have any questions or comments for Jessica? All right. If not, we'll move on to our next agenda item, which is to EDP 20-026, receive a report, hold discussion, give staff direction regarding the nominations for the annual business awards. Thank you guys very much. We're going to sign off. Thanks, Tom. Got our marching orders. Thank you guys. I'm sure they're getting right to work. So we usually have an annual awards breakfast, as many of you all know, where different city departments, as well as boards provide awards to various businesses for different reasons. This year, unfortunately, we won't be able to hold that awards breakfast, really out of concern, again, for safety. We don't want to plan to hold an event in September, knowing that large events are definitely discouraged at this moment. So we have been brainstorming ways to do online awards or virtual awards, and we're still working out all of the issues related to that. But we definitely wanted to make sure that this board had an opportunity to continue to nominate and select award recipients. And so we wanted this item on the agenda to allow for the first discussion of nominations or how we could move forward, definitely open to ideas of ways we can move forward. But certainly, this has been an incredibly tough year on our businesses. And I think that any way that we can demonstrate support to them, knowing that many of them have undertaken great efforts to assist individuals as well as their employees or even other businesses in this time. So the board normally does two awards. We added the small business award last year. So the first award was just the EDP business award. And that was for an employer over 100 employees. And then last year, we added the small business award. In your packet, we had outlined the award recipients from past years. Last year, the large business award went to embassy suites, and the small business award went to LA's TECA. So I will just open it up to the board for questions or discussion and know that we're still in progress. Any comments, questions? This is Jill Jester. Can you walk us through the timeline of what we need to do? At what point do we need to start submitting nominees? What information do we need to include in those nominations at the next meeting? Where should we be in the process? Just so that we kind of, with everything swirling around, we know when we need to be doing things. Sure. So typically, we would be having the awards breakfast in September. So we'd use the July, August, and September meetings to select or to nominate, review the nominations, and make the final selection of the award recipients. Since we don't have that deadline, we have a little bit more flexibility. So what I was thinking is that this will kind of kick off the nomination process. Any board member could submit a nomination between now and the August meeting. At the August meeting, then we could bring back the research that we normally do. In your packet, you have the business recognition award criteria sheets. And that staff then goes through the nominees and evaluates them based on those criteria. And then we bring those back to the board to review and discuss. So I'm thinking that could happen at the August meeting if we get some nominations between now and then. Obviously, if not, if we need a little bit more time, we can have that. Does that answer your question, Jill? Yes, it does. Thank you. So in for our August meeting, we'll ask the board members to give you any names or suggestions to to visit about at our next meeting. And then I would also ask staff to bring some names together. You guys generally do a pretty good job of having the pulse of what's going on. And that's that's helpful as well. Sure. We can do that. So if the board could send us nominations, if you think of someone, send it to myself via email, or I'm sure I will see many of you at least remotely between before the August meeting. And we'll get that work done and then have the criteria sheets for those nominations at the August meeting. All right, our next item is EDP 20-019, Receiver Report, Hold Discussion Regarding the Downtown Economic Development Committee. I'm not sure who's going to talk about that. I think Christina has the update for the downtown economic. Christina is shaking her head no, but she prepared the report. So reports out there. Yeah, we had a meeting the first quarter, we had a couple meetings and we asked and then we took two months off. We actually met last week to look at give some feedback on streeteries and parklets and one way traffic versus two way traffic and had a pretty good discussion on that in the past. So the reports out there, if anybody has any questions or continuing to meet, that'll meet next week or two weeks from now. Yes, I think we're meeting the second week of August. We had to move our meeting. Yes, but just want to, you know, brief update for the committee. Just know that the downtown economic development committee did take a long break. I think they were one of the last committees to meet in March and they just started meeting again in July. But after July meeting, they did have a grant application come forward for H2OAK. And so that was recommended for approval and that will move on to the TURS board next. And then we, in the report that Christina did provide to you, it included some updates on the existing grants that used to come before this board and now have transitioned to the other board. So we'll continue to provide that information just so that this board remains aware of the grant funding that goes through now directly from the downtown committee to the TURS board. Comments or questions? All right. Our last item is EDP 20-027 and that is staff report. So we'll get an update from Jessica or Christina. Do you guys want to chime in? We did not provide an additional city report. Our last report that you got about two weeks ago still covers all the items that we were working for. So I'll let Charlie talk about his report. Yeah, the June reports in your packet kind of describes what we've been up to. We've been doing a lot of work on our website and getting that updated and getting it rearranged where it's more easily accessible, particularly for site locators. We've been doing a lot of research on digital marketing since that's going to be the future of where we're going and how we can get there and what are some of the things we need to do to be better prepared for the digital marketing age. We also have been, during the month of June, we've been handling all of the RFPs for the state and Dallas chamber and Fort Worth chamber. We submitted nine RFPs during the month of June, then had a visit, I mean a phone visit with a company that's looking to build a facility for a company in California that they're trying to get to move. It was a direct call to us and we'll be hosting one of their company representatives tomorrow afternoon. He just called last night and said, "I want to come see some sites tomorrow." So we'll be doing that as well as just staying in touch with a lot of our developers and brokers and finding out where they are with a lot of their we have, as you know, we have three buildings under construction right now and just trying to stay on top of those because so many of the RFPs that we get are requiring existing buildings. So now that we have those, that's going to be a real asset to Denton to be able to show that we have a building available, be available at a certain point in time and so we're really excited about that. That's going to be a great deal. Our EDP industrial license committee met. This is the fundraising group and we met during, we met during, on Zoom during the month and in providing them with some some marketing material to help provide additional investors. So we're moving along and staying very busy. Thank you. Any questions? All right. Thank you, Charlie. I think that's our last item to discuss and before we adjourn, I want to make sure we recognize a couple of folks that are working behind the scenes. Billy Matthews is helping record all of this and Rachel drew the short straw to get to listen to all this all day. She probably does Zoom meetings all day long now and thank you for being here and helping make sure things are going smoothly as I look at your picture over here on that side. But our next meeting is Wednesday, August 12th. Make sure that's on your calendar and we'll just plan on that being Zoom until we hear otherwise. But appreciate everybody blogging on today and all your efforts and helping the city of Denton. So with that, I'll take a motion for adjournment. Come on. I'll move. All right. We're adjourned. Everybody can log off. Go back to your real job. So thank you so much. Look forward to seeing everybody soon. Thank you. Bye, everyone.