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HomeMy WebLinkAbout04-08-19 Community Investment "SpUTH 8�0 4,6 � CU� y PEACE % N 1865/-° OFFICE OF THE CITY CLERK KAREEMAH FOWLER, CITY CLERK COMMUNITY INVESTMENT APRIL 8, 2019 3:30 P.M. Committee Members Present: Gavin Ferlic, Regina Williams-Preston, Sharon L. McBride, Kyle Copelin(citizen member), Sara Boukdad (citizen member), Oliver Davis (late) Committee Members Absent: None Other Council Present: Tim Scott,Jo M. Broden, John Voorde, Karen White Other Council Absent: Jake Teshka Others Present: Graham Sparks, Bob Palmer Presenters: Dan Buckenmeyer, Troy Wade, Michael Hall, Tim Blockey, John Hopkins, Mike Williams, Angelina Billo, Jeff Smoke, Paul Phair Agenda: Bill No. 19-18- Molding Products Designating Personal Property Tax Abatement Bill No. 19-20- Chase Plastics Designating Personal Property Tax Abatement Bill No. 19-22- Hopkins Properties Designating Real Property Tax Abatement Bill No. 19-24- CBK Land Development Designating Real Property Tax Abatement Bill No. 19-26- Catalyst Three Designating Real Property Tax Abatement Bill No. 19-28- GLC Portage Prairie IV Designating Real Property Tax Abatement Bill No. 19-30- 31 Nimtz Land Designating Real Property Tax Abatement Committee Chair Gavin Ferlic called to order the Community Investment Committee meeting at 3:30 p.m. He introduced members of the Committee and proceeded to give the floor to the presenters. Bill No. 19-18- Molding Products Designating Personal Property Tax Abatement Bill No. 19-20- Chase Plastics Designating Personal Property Tax Abatement Bill No. 19-22- Hopkins Properties Designating Real Property Tax Abatement INTEGRITY' SERVICE' ACCESSIBILITY JENNIFER M.COFF iAN BIANCA L.TIRADO JOSEPH R.MOLNAR CHIEF DEPUTY/DIRECTOR OF OPERATIONS DEPUTY/DIRECTOR OF POLICY ORDINANCE VIOLATION CLERK EXCELLENCE I ACCOUNTABILITY I INNOVATION I INCLUSION I EMPOWERMENT 455 County-City Building 1227 W.Jefferson Blvd.I South Bend,Indiana 46601 I p 574.235.92211f 574.235.9173 I www.southbendin.gov CITY OF SOUTH BEND OFFICE OF THE CLERK Bill No. 19-24- CBK Land Development Designating Real Property Tax Abatement Bill No. 19-26- Catalyst Three Designating Real Property Tax Abatement Bill No. 19-28- GLC Portage Prairie IV Designating Real Property Tax Abatement Bill No. 19-30- 31 Nimtz Land Designating Real Property Tax Abatement Dan Buckenmeyer, Director of Business Development for the Department of Community Investment with offices located on the 14th floor of the County-City Building, stated, I'm here with an exciting afternoon. We have, as you are fully aware, several tax abatements. Seven (7) to be exact, that makes eight(8) for this year. We did only six (6) in the entirety of last year. You know, it is exciting though. Right now, we are looking at a room filled with folks who are investing over $60 million in our community. Most of it over the next year to eighteen (18) months. All of these projects, some of these we've been talking about for five (5) years, some of this stuff we've been talking about for five (5)months, or five(5) weeks maybe. But all of them are very meaningful in their own way to the community. Again, there's sometimes a tendency to say, oh my gosh, we're giving away. We're not giving away. Tax abatements are pure upside. The fact is that the current tax year value, and here are seven that we'll go through, but the current tax value on these, of the properties that we're talking about, is only $150,000 a year (referencing a slide in a presentation which is available in the City Clerk's Office). He continued, Our estimate, of course, and we always have to work in estimates, we don't know exactly what's going to happen in the Assessor's Office, but our estimates suggest that, when all of these roll off and when we have phased in all of the taxes, all of these projects, that yearly number on these same properties will look more like about$1.3 million annually. So, really mark improvements to the tax rolls. Again,current assessed value is$6.7 million. We're seeing over$60 million in investment. Add to that the one (1) other tax abatement we made, and the fact that one of our partners here that we're asking for support for in a personal tax abatement, also made a $5 million real property investment already that we are not abating,but, if we add that,we're looking closer to upwards of$70 million in investment for this time period. He went on, In terms of jobs, six hundred and six (606) jobs will be retained. One (1) very important deal will be the bulk of those and we'll talk about that as we go along. The other number I want to talk about for a second, and we'll get in to in more detail, sixty-two (62) new jobs,which feels pretty low, and we admit that up front. That's because we've got two (2) exciting projects that are spec buildings, so, we only look for this number as direct jobs. So, the person or entity getting the abatement is going to directly employ folks. In this case, we've got two (2) entities that will build buildings and lease them out, but, I'll get into that later, we've got a great track record on spec buildings and are thrilled to have more coming up in town. We often look at these, even though our abatements that we're going to look at, they're a couple of five(5) years, six(6), seven (7), eight(8)years,the longest is an eight(8) year abatement. In order to do our own computations and just look at them over a full landscape, we look out for a decade, and if you look out for that decade,the taxes paid during those ten(10) years, so,that is any increase as they phase in and then those last two (2) years, if you will, at full, will be $7 million added to the tax rolls, again, that would not have been there without these projects. EXCELLENCE ACCOUNTABILITY INNOVATION INCLUSION EMPOWERMENT 455 County-City Building 227W.Jefferson Bvld South Bend,Indiana 46601 p 574.235.9221 f574.235.9173 TTD 574.235.5567 www.southbendin.gov 2 )CITYOFSOUTHBEND I OFFICE OF THE CLERK He continued,You can see kind of where the projects are dotted if you look at the map(referencing a slide in the presentation. Not real surprisingly, Ignition Park, up Sample Street, I have included Grace Steel on there,who,again,we did earlier this year,and then a few up in our logistics corridor there. So, any questions before I start jumping in to these specifically? I'll get you what I'm looking at, and I apologize for that, I thought that was going be here. In any event, this slide just simply shows your private investment. So, again,looking at each project,it takes us up to that$60 million plus in private investment. That's going happen, again, we anticipate in a very rapid time frame in the next year to eighteen (18) months. Additionally, we do have a view or chart of the taxes. So, again, I talk about that $150,000 or $147,000 per year that those properties have as a tax base today. Where they're going to start rolling on, by year seven (7) we're going to surpass $1 million a year as these are phasing in, and then, year eight(8),nine(9), ten(10), they come to fruition and will be paying the full tax amount. He went on, So, we'll start with Molding Products. Troy and Tim are here from the company to help me make sure I don't make any mistakes. I was really thrilled to meet these guys and learn a little about the company.The company has been here for over forty(40)years. They make,in very simple terms, sheet plastic which then goes out as raw material to companies that press it into various shapes, sizes and products. Everything from bathtubs to my favorite Corvette body panels. So, here we've got this company right in our backyard doing some amazing things. This is who I mentioned, they already have done a $5 million real property investment and built the building that all of their capital equipment, that will double production, will go into. That is another $5 million that they've asked for assistance with in the form of a personal property tax abatement.The max on that as a standard is five (5) years. They will, by doing this, again, I've already said, but, they will double the production, retain forty(40)jobs, add twenty(20) new jobs, and the average wage is eighteen dollars per hour ($18/hour). So, the request is for support of a personal property tax abatement for Molding Products. The full amount abated is $52,331. In that same period of time, they will still continue to pay taxes on all of their other equipment. So, they'll be paying throughout those years $687,630 on existing new equipment as a base. Committee Chair Ferlic opened the floor to questions from Committee and Council Members. Committeemember Kyle Copelin asked, Are the twenty (20) new jobs full time, or is there a temporary measure? Troy Wade, 1545 South Olive Street, replied, I'm the Vice President and General Manager of Molding Plastics LLC. A lot of them are salaried, fifteen(15) are hourly. Mr. Buckenmeyer continued, Alright,Bill No. 19-20 is Chase Plastic Services, so we'll see two(2) here for the same facility. This one (1) is the personal property tax abatement. So, Chase Plastics was an early entrant into Portage Prairie. They've been there, and this is a primary distribution center for their business that is located in Clarkston, Michigan. Great location, as we know, we provide for central in terms of logistics and shipping and warehousing and so on. They are doing so well that they need to expand by roughly a third(1/3). In terms of that investment they're going to be doing, well, it is an $823,000 project. They are another company in plastics, but they specialize in pellets. So, they warehouse and sell plastic pellets to folks who mold them into end products. They sometimes blend them for color or certain elements of plastics. I'll leave it at that before I get over my skis,which I already am. Nineteen(19)retained jobs and will add twelve(12) EXCELLENCE ACCOUNTABILITY INNOVATION I INCLUSION EMPOWERMENT 455 County-City Building 227W.Jefferson Bvld South Bend,Indiana 46601 p 574.235.9221 f 574.235.9173 I I D574.235.5567 www.southbendin.gov 3 CITY OF SOUTH BEND OFFICE OF THE CLERK new jobs as they add that warehouse space. They have a good wage and a great history. I've been out there a few times. They've got some employees that have been around for a long time. It is a great work environment and there are some great people there. Michael Hall is here, and he runs the South Bend facility if you have any questions. He went on, Before you ask, I'll jump into the other side of this in terms of, again, we do personal property tax abatements on capital equipment, we are supporting them additionally with a real property tax abatement on that actual expansion,the building itself. It is a$3.5 million investment. 80,000 square feet of additional docks and so on. This represents their investment there. So, the building expansion,the total taxes paid on the personal property will be about$32,000. Total taxes paid on the building will be about $118,000. The abated amounts, for the real property is about $470,000 and for the personal property it is about $25,980. Committee Chair Ferlic opened the floor to questions from the Committee and Council Members. Councilmember Tim Scott stated, I just need to make this announcement and I will do it again tonight. The company I work for, GEC, Chase Plastics is a supplier to us. I am the Director of Material Management. All purchasing falls under my department. While I don't benefit directly from any business that we do, I will abstain from voting on this tonight,just to avoid any type of conflict. I will say, Chase Plastics is an incredible supplier and a very good business. We do full blown IATF,which stands for the International Standard for Automotive audits, on them and they pass with flying colors. I've been to this facility and it is an excellent facility. They have good employees too. Michael Hall, 5245 Dylan Drive, replied, Thank you for the support. We've been in this building for three (3) or four(4) years and this is a great opportunity. Councilmember Jo M. Broden stated, Several of these abatements are related to improvements on leased properties. Could you address that in terms of ownership, status and that improvement? Who does it connect to or accrue to, you know? Mr. Buckenmeyer replied, I'll try to answer that, but I'll say each situation is different. In this situation, the reason we have two (2) abatements with two (2) separate entities, the personal property is for Chase Plastic Service and a separate LLC, in this case CBK Land Development, is created to own the land. The real property tax abatement benefits the land owner, in this case it is another branch of the same company, in other cases it is a developer or a completely separate entity. Councilmember Broden followed up, Then with regard to the new hires, that is tracked over to 2030 as a total of thirteen(13), and there are a lot of variable wages on that. I just wonder,in terms of recruitment or skill building within our local workforce, WorkOne is not checked off on the list as a partner in that. Is there a sense that we have already identified skillsets within our community and individuals that can pop right into these jobs over time? Mr. Hall replied, In terms of identifying potential candidates, we have not. But we do use staffing agencies within South Bend.The additional employees are full-time but over the course of ten(10) years or what not,we do always have contract workers,as well,working for us. They will become, as we transition, full-time. EXCELLENCE ACCOUNTABILITY INNOVATION I INCLUSION I EMPOWERMENT 455 County-City Building 227W.Jefferson Bvld South Bend,Indiana 46601 p 574.235.9221 f 574.235.9173 TTD 574.235.5567 www.southbendin.gov 4 )CITY OF SOUTH BEND OFFICE OF THE CLERK Councilmember Broden stated, This is my last question. This is for the two (2)that we've already heard, and then if it applies to others going forward. In terms of purchasing this equipment, how much of it is done either with Indiana or regional suppliers? Tim Blockey, 81545 South Olive Street, replied, Our main mixing equipment was purchased out of Fort Wayne. Otherwise, we are looking at a variety of other vendors but can say several hundreds of thousands of dollars came straight out of Fort Wayne. Mr. Hall replied, Most of it is coming out of, like our racking, Dowagiac, Michigan. Then the forklifts are bought right here from South Bend. Councilmember Broden stated, I think that is helpful information to share, so, thank you. Committeemember Regina Williams-Preston stated, My question kind of falls in line with what Councilmember Broden is getting at, in terms of community benefit. How are we using folks within our community, whether it's suppliers or labor force or things like that? So, the building itself is going to be expanded. Has that contract already been awarded and do we know who is doing that? I'm asking these questions, and I will be for any of the new development. I learned something new. I learned about PLA's, Project Labor Agreements. So, I'm really interested in moving forward. How can we use that tool to actually make sure we are hitting some targets? Now that the contract has been awarded, things are kind of moving forward but that is something I am definitely looking forward to as we start bringing these tax phase-ins forward. Again, working together and being good community partners, how can we put something in writing to make sure we are actually hitting the targets we are trying to hit in terms of engaging the people within our community and lifting everyone up? Mr. Hall replied,We are using Majority Builders for this expansion. We used Holladay Properties Holladay Construction for the initial building. So, this is the first (1st) building we have actually owned and built. Prior to that, prior to 2014, we leased in South Bend. Mr. Buckenmeyer continued, Onward, this one(1) is exciting. It's going to really change some of the landscape as folks come into South Bend as they pass through. The recipient of this abatement is Hopkins Properties, also known as Truck Centers INC, (TCI) and formally known as Hill Truck Center down on Sample Street. They are soon to be formally located right next to our Central Services on the north side of Sample Street. What they have done in terms of land assemblage and this project is, right on the corner of US-31 and the tollway here, a wonderful and great piece of property that will allow them visibility. It's great because their business is in trucks, both selling and repairing big rigs. We are excited about that and ask for your support for this project. It's a big deal. It is nearly $18 million of private investment for a new facility that will be about 100,000 square feet. They will retain forty-two (42) jobs and they will add thirty (30) new jobs. Again, these are of very desirable pay. It will take about twelve (12) to eighteen (18) months or so until you see the actual facility. It will be a gorgeous tech repair center. They will start ramping up and start hiring in advance of this, so they are ready to hit the group running with this. Mr. John Hopkins who is the Chairman and CEO, is in from their headquarters in Illinois and then Tyler Yates is a VP and heads up the South Bend location. Councilmember Karen White stated,You mentioned the designation as an economic revitalization area for three (3) years. Could you expand on that? What does that mean? In section five (5) of this. EXCELLENCE ACCOUNTABILITY INNOVATION INCLUSION EMPOWERMENT 455 County-City Building 227W Jefferson Ovid South Bend,Indiana 46601 p 574.235.9221 f574.235.9173 T1D574.235.5567 www.southbendin.gov 5 1110 CITY OF SOUTH BEND OFFICE OF THE CLERK Mr. Buckenmeyer replied, The designation is just another way of saying it will be part of a tax abatement. Councilmember White followed up, So, it's just a designation and there are no additional dollars forthcoming besides the tax abatement that is being asked of? Mr. Buckenmeyer replied, No. Councilmember White then asked, So, any other developer that wanted to expand and develop in this area, that would be the designation, right? Mr. Buckenmeyer replied, The economic revitalization area will be ordained as just this property for only this recipient. They are going to develop that entire property. Councilmember White followed up, So the other incentive is the tax abatement? Mr. Buckenmeyer replied, Yes. And, this is jumping ahead a little bit but one (1) important thing I want everyone to know, and this has been shared with a lot of developers and the folks in that region, this falls right below Portage Prairie where we've had a lot of wonderful growth but a lot of growing pains in terms of increased traffic issues, frequency and also with trucks and speeding cars. We are working on a lot of different things in that vein. We are working with the County, the companies and the developers to make sure that all of the appropriate rules, and so on, were followed. We are also looking at this from the standpoint of TIF investment versus tax abatement. So traditionally with spec building and other things developing in this region, we've supported them with TIF to help with some of the infrastructure developments going the last mile to the building. With TIF, for example, parking, and what-have-you. We are redirecting any TIF spending in that general region to infrastructure surrounding it. Largely, traffic, Ameritech Drive, and the Cleveland Road interchange. One (1) thing we have set aside some funding for is what will be a pretty massive project to completely redo that interchange next year.The State is planning some work along the bypass that will be done in that same timeframe. We wanted to dovetail with that. So, we've just in the recent weeks and month made clear that our TIF allotments and expenditures in that area will go to infrastructure like that. But, yes, only tax abatement. Councilmember Broden stated, This is an intercity move from Sample Street to here. Could the petitioners address the benefits of this site, as opposed to where you are currently at? John Hopkins, 38 Country Club View, Edwardsville, IL, replied, If I could, I will do a little background and then I'll come right to your question. We are forty-nine (49) years in business when we acquired Hill Truck sale. They had been in this area for fifty-four (54) years and we acquired them in January of 2016. So, we gave them all the seniority of all of their previous years of employment. We are multi-generational, and we are proud of that. We have twenty (20) employees that have been with us for over forty (40) years in our company right now. We just awarded last week a forty-five(45) year employment award which included a very nice check and plaque to one(1)of our long-time technicians up here. Today I just awarded a thirty-five(35) year award, a nice plaque and check to another long-time employee. One hundred and sixty-five (165) over twenty(20) years with us. Training and education are really huge for us because our industry keeps evolving and changing and there is a lot of construction going on, so we have to be really EXCELLENCE ACCOUNTABILITY INNOVATION INCLUSION EMPOWERMENT 455 County-City Building 227W.Jefferson Bvld South Bend,Indiana 46601 p 574.235.9221 f 574.235.9173 TTD 574.235.5567 www.southbendin.gov 6 vieCITY OF SOUTH BEND OFFICE OF THE CLERK quick at moving. We have our own dedicated training centers. We have our own dedicated school. We've been doing the school now for about five (5) years and we have fifty-five (55) graduates from the school. All fifty-five (55) of them are still employed by us over these past five (5) years. All are really great and strong technicians or parts people. At our training center we've trained over 6,000 technicians across North America at our Troy, Illinois location. We are going to have a sub-training center here in South Bend because of the distance from our Troy location. Tyler already has that person being trained. It takes about two (2) years to get them trained to be able to educate and train all of our people and certify them. Again, it is a great opportunity for us to be here and be a part of your community. Moving to that location, for us, is important because of the exposure to the Toll Road 80/90 and US-31.The Hill Family had not invested in the company over the last couple of decades and everything became transient. We represented Freightliner which has forty percent (40%) market share, which is Mercedes Benz Worldwide and the largest truck manufacturer. So,it's really important to us to be seen and visible if we want to continue to expand our business. This is a big project to us. Most of our facilities have been between $7 million and $8 million. This one (1) is between $18 million to $19 million. It's a big one(1). Tyler moved his family up here to the Granger area, relocated, and he may be a Cardinal fan, but I don't hold it against him. We are asking you for some abatement on the taxes to help us ramp up over that period of time to make it economically viable for us as we go forward. Thank you. Committee Chair Ferlic stated, Citizen member Kyle Copelin has notified me that he works on the next project, so, he will recuse himself on the vote when the times comes. Mr. Buckenmeyer continued, Bill No. 19-26, another big one (1), folks. Back in 2015, and this is a little history here, but a deal was struck between the City and Great Lakes Capital to build three (3) buildings at Ignition Park. This deal does a few things. One (1) of them is it completes that agreement. That agreement, back in 2015, added a$900,000 TIF allotment. So, this is a rare case where TIF and tax abatement are combined but it is going to make sense in a minute. That $900,000,we have a situation where the land owner,building owner and developer are completely different entities from the tenant. The land owner, developer and building owner, Great Lakes Capital, is going to be building a $16 million building. It is going to be bigger than the other two (2)there now. They are both about 50,000 square feet. This one(1)is going to be closer to roughly 83,000 square feet.Now,again,it will be leased to a very important South Bend citizen.The reason we are doing a tax abatement in addition to this is, again, in economic development, we are either trying to attract somebody here or retain someone here. This is definitely a retention incentive for Press Ganey. Press Ganey has been working with the City for,probably around five(5)years now, in trying to find the right sweet spot for them to relocate. Their employees have been in the same place for a while and they have been here since 1985. That is thirty (30) plus years. They were founded here, and we are thrilled to keep them here. They have become a national force. They're all over the United States right now. So, it is very meaningful for us and we're glad to know it is meaningful for them to stay in South Bend as well. He went on, Now,just to be very clear about the tax abatement and the TIF, TIF is going to help build that building like was originally intended back in 2015. PG is signing a triple-net-lease with Great Lakes. Triple-net-lease means that, in addition to their lease payment, they are going to pay the property taxes. By us alleviating that property tax burden, that is why it is a direct retention incentive to help PG fund their relocation to a new building and fulfill their desire to stay in South Bend. EXCELLENCE I ACCOUNTABILITY j INNOVATION I INCLUSION ; EMPOWERMENT 455 County-City Building 227W Jefferson Bvld South Bend,Indiana 46601 p 574.235.9221 f 574.235.9173 TTD 574.235.5567 e ww.southbendin.gov 7 •CITY OF SOUTH BEND I OFFICE OF THE CLERK Mike Williams, 404 Columbia Street, stated, I am the Senior Vice President of Operations for Press Ganey. It is really an exciting opportunity to help complete the Ignition Park project. We, frankly,have outgrown our space.We have two(2)campuses in South Bend.There is a production facility that is going to stay as is,then the other is an Administrative Building where we have about four(4) properties right now. This will allow us to consolidate that in a much more contemporary and productive work environment for our Administrative personnel. We are really excited about it. Committeemember Sara Boukdad asked, Was there a tax abatement for Catalyst One(1) and Two (2)? If so, how much was abated? Mr. Buckenmeyer replied,Yes. Every year by June 15th,by ordinance,we provide a tax abatement report to Council. That is the culmination of all the reporting that any tax abatement recipient must do. By May 15 they have to give us what is called a CF-One (1), along with other things to the Assessor and Auditor. Angelina Billo, Business Development Manager for the Department of Community Investment with offices on the 14th floor of the County-City Building,replied,They received one(1) for seven (7) years and they completed their abatement. Committeemember Williams-Preston stated, This deal has been on the line for a while and I heard there was a real concern about us actually losing the company. I'm wondering if anyone would be able to speak a little bit to the hypothetical, if you didn't get this abatement, what might your prospects be? What were your considerations? Committeemember Oliver Davis arrived at the meeting at 4:07 p.m. Mr. Williams replied, We have eighteen (18) locations and facilities throughout the county as a product of creating redundant operations as well as acquisitions. So, this is part of a big process where we are looking at working with the legislature on some corporate income tax changes to make Indiana more favorable to us to stay, as well. The options are, when we have eighteen (18) other spots,to intersperse or build in some of these others, one(1) of which would be Utah, where we recently built out a redundant production facility. So, our goal is to stay at home. We have about 1,300 employees nationwide and five hundred and fifty (550) are here. So, this is the majority and we wanted to be true to our family and our origin. Committeemember Williams-Preston asked, Is Majority Builders doing this? Mr. Williams confirmed, Yes. Mr. Buckenmeyer continued, For a prelude to the next two (2), if there is any indication, from an economic development standpoint, of a full-functioning and growing economy, it has got to be someone willing to build a building and invest in the community without a defined tenant. We have two (2) coming here. $20 million between the two (2) of them being invested in the community. That is a really solid statement about where, I think, our community is and where it is going. This is the absolute faith of professionals and commercial real estate investors and people who are a lot smarter than me, willing to invest in the community. The first(1St) we will look at is the fourth (4th) spec building that Great Lakes Capital will be doing. Again, if you recall, those EXCELLENCE ACCOUNTABILITY I INNOVATION INCLUSION I EMPOWERMENT 455 County-City Building 227W.Jefferson Bvld South Bend,Indiana46601 p 574.235.9221 1574.235.9173 TTD574.235.5567 www.southbendin.gov 8 %CITY OF SOUTH BENZ) OFFICE OF THE CLERK jobs only being at sixty-two (62) while also having over $60 million of investment, this defines that. We have over 400,000 square feet of new buildings being built, but we don't have any numbers for direct employees for those. The first(Pt)three (3) spec buildings GLC has done, one (1) now houses AM General, one (1) houses CTDI which, alone, is five hundred (500) plus employees and AM General has over one hundred (100). And their last one (1) is just being finished and is likely to have several hundreds of employees there, as well. So, I think they have reason to be confident in this, I hope, and certainly they have a good track record. This is a large plot of land right now. The building will go right about here (referencing the presentation). It will be a$7 million investment for 166,000 square feet. It will be different from the buildings already built out there. There will be the same access to the logistics corridor out there. There are indirect jobs. Jeff Smoke, 112 West Jefferson, stated, I want to thank you all for the opportunity. I think Dan said it best.This is just continuing on the momentum we built out there with the first(1st)buildings. We hope to break ground this summer. Committee Chair Ferlic opened the floor to questions from Committee and Council Members. Committeemember Williams-Preston asked, Has a contract been awarded for these buildings already? Mr. Smoke replied, Not yet. Committeemember Williams-Preston followed up, Would you be willing to consider a Project Labor Agreement for either of those? Mr. Smoke replied, Typically, we use Majority Builders and Stride for all local employees when we can. If it would work for us, though, yes, we are open to a conversation. Committeemember Williams-Preston stated, Ok, cool. Now this is an area where we are doing a lot of stuff. What are the neighbors saying about this? Council President Tim Scott stated, I can answer that. The last time they were here was on the CTDI building. We actually put together a twelve (12) point action item list. This falls between the County and the City. Economic Development is involved, Engineering on the City and County level are involved, and it could be as simple as wayfinding on signs to what we are looking at, there is going to be new improvements to the Cleveland overpass with the State coming in,as well. There are growing pains out there. We are looking at that. We had a meeting with the neighbors. We are working through some of that with our Engineering and the County's. Pretty much everything out there is the County but, as we grow, we know there is a responsibility between the both of us. Their Engineering group is looking at traffic studies because if you drive the roads out there, the roads aren't made for this. We are also meeting with the developers and the companies on making sure which direction their people are coming from. Also, the wayfinding signs are the key there.There really aren't any wayfinding signs to instruct trucks to go the right direction down Dylan instead of wandering through Orange, Mayflower, and Brick and everywhere else. Sheriff Redman is involved, as well. There will be more to come on that. We have Engineering working on it. The neighbors are not thrilled but they are happy we are looking at solutions for them on all that. Dylan Drive really should be the only way in and out of there and that is kind of the issue. EXCELLENCE ACCOUNTABILITY INNOVATION INCLUSION EMPOWERMENT 455 County-City Building 227W Jefferson Bvld South Bend,Indiana 46601 p 574.235.9221 f574.235.9173 TTD 574.235.5567 www.southbendin.gov 9 •CITY OF SOUTH BEND OFFICE OF THE CLERK Then you cross over Adams. People have the freedom to go wherever,though, and you've got that many employees, we are talking to them about that and some other things. Also, Great Lakes has agreed to put up a walking path along Adams as well. We are working with everybody to make that situation better. Committeemember Williams-Preston followed up, I know you had that one (1) meeting with the neighbor. Is this one (1) property the one (1) that was damaged from the other? Council President Scott replied, They are looking at that. Committeemember Williams-Preston followed up, The man who was living there can't live there anymore because the basement caved in. Council President Scott replied, A little change on that. That is a rental, actually. He owns it and rents it out. Committeemember Williams-Preston stated, Regardless, his property was damaged. But that Dylan Drive is where you are talking about. So, you're working with him? He's one (1) of the neighbors, I'm sure, that you've been talking to? Council President Scott replied, Yes, we are on fact-finding. Committeemember Williams-Preston stated, Good, we have to stay aware of what is happening with that. I know they were really concerned. Thank you. Councilmember Broden asked, So, is the access off this property Dylan? Is there any screening relative to Mayflower? Mr. Buckenmeyer replied, There will be no access to Mayflower. It will be a quarter mile away, or so. Councilmember Scott stated, This Council made sure that when the CTDI Building went in that, I think we all agreed, there is nothing that connects to Mayflower or Brick up to the Michigan line. I'm still in favor of that. Mr. Buckenmeyer continued, Last, but certainly not least, again, another spec building. So, this is Nimtz Parkway (referencing the presentation) and that is the Bypass. We are just east of it. One (1) of these was an island that was annexed into the City. Both will be added to the Riverwest TIF District with the TIF realignment, which, again, this is the only tax abatement. In this case, this is Holladay Properties. They are looking at an about 225,000 square foot $18 million building. It could be all one (1), it could be divisible, but several dock positions and again great access to our corridors. We are thrilled to have another spec building go up. It's a huge one. Paul Phair, 227 South Main Street, stated, I would like to echo a lot of what Jeff said. Thank you, very much,for the opportunity. We are excited to be making a big investment out on the northwest side again. This is really a good indicator, especially by people who are outside of the market looking for space. It has been a very tight market, so, to be able to add space out there, it will definitely gain the attention of brokers and users who aren't in this area but are looking for a new EXCELLENCE ACCOUNTABILITY INNOVATION INCLUSION EMPOWERMENT 455 County-City Building 227W.Jefferson Bvld South Bend,Indiana 46601 p574.235.9221 f574.235.9173 TTD 574.235.5567 www.southbendin.gov 10 CITY OF SOUTH BEND OFFICE OF THE CLERK home. We are going to be using Holladay Construction Group as our general contractor. Our plan right now is a July groundbreaking with delivery in the first(1St)quarter of next year. The building is being designed for both manufacturing and distribution uses. So, it will be flexible to try and accommodate as many users as possible. From a tax standpoint, Dan touched on it a bit, but these will be net lease agreements. So,operating expenses,including taxes,are typically paid by tenants. So, the benefit is really being seen by the end user and operator. So, it helps us offset some of that risk because it is a big investment for a building that has a lot of vacancy. It helps us offset that and it makes the building more attractive to that end user. Committeemember Oliver Davis asked, How do you think this helps us in terms of making our City more marketable than cities in our region like Mishawaka or Elkhart? Mr. Phair replied, By having this space available, it helps shorten people's timeframe on when they can get up and operating. So, for somebody who is sort of landlocked, Chase Plastics was a good example. They had a little bit of land left but for somebody that didn't have that available, they would have to look elsewhere. This provides a landing spot for someone looking for space. I'm not aware of Mishawaka having any spec buildings. I think Elkhart had one(1)but I think that is filled. So, it does make us competitive having these spaces. Committeemember Davis followed up, So it puts us in a league? Mr. Phair replied, Sure. Committee Chair Ferlic opened the floor to members of the public wishing to speak in favor of or in opposition to these items of legislation. There were none. He then turned the floor back to the Committee for further comment or main motion. Committeemember Davis made separate motions to send Bill Nos. 19-18, 19-20, 19-22, 19-24, 19- 26, 19-28, and 19-30 all to the full Council with favorable recommendations. Councilmember Sharon L. McBride seconded these motions which carried by a voice vote of six (6) ayes*. *(Committeemember Copelin abstained from voting on Bill No. 19-26) With no further business, Committee Chair Ferlic adjourned the Community Investment Committee at 4:24 p.m. Respectfully Submitted, Gavin Ferlic, Committee Chair EXCELLENCE ACCOUNTABILITY INNOVATION INCLUSION EMPOWERMENT 455 County-City Building 227W.Jefferson Bvld South Bend,Indiana 46601 p 574.235.9221 f 574.235.9173 TTD 574.235.5567 www.southbendin.gov 11