HomeMy WebLinkAbout11-26-12 Community & Economic Development COMMUNITY & ECONOMIC DEVELOPMENT NOVEMBER 26,2012
5:15 P.M.
Committee Members Present: Henry Davis, Karen White, Gavin Ferlic,
Dr. Fred Ferlic
Other Council Members Present: Tim Scott, Val Schey, Dr. David Varner,
Oliver Davis, Derek Dieter
Other Present: Pam Meyer, Lee Slavinskas
Agenda: Bill No. 12-85 —Renewing the UEZ
Pam Meyer, UEZ—20 yrs. State Law allowed 5 yr. extension 12-1-13 to 12-1-18, 12
positions on UEZ designated by State Law.
• One of 13 of original 28 zones.
• Income was 1 million year, now 150K year.
• Incubator is major program—negative cash flow 35-38 businesses/now for sale
Chairperson Henry Davis with full CED Committee present opened the meeting with one
scheduled item on the agenda Bill No. 12-85. This bill would renew and extend the term
of the South Bend Urban Enterprise Zone for five years.
Henry recognized Pam Meyer from the Community Investment Department to make the
presentation. Pam acknowledged the presence of two UEZ Board Members present,
Councilmember Karen White and long-time member and former Councilmember Lee
Slavinskas. Pam then provided some background to UEZ. She said state law 20 years
ago allowed local communities to designate UEZ's. Businesses' in these economically
challenged areas would receive a variety of tax breaks ranging from the elimination of
inventory taxes to tax credits for job training for zone residents. A portion of these
savings would be paid back to the UEZ to fund its activities governed by an appointed
board made up of business owners and residents in the zone. Appointments would be
made by the Mayor and Council following state guides including political balance. By
far the biggest tax break and subsequent source of revenue for the UEZ was the inventory
tax break. However since the inventory tax was eliminated statewide the payback to
UEZ's has fallen sharply as has the number of zones statewide. Pam said South Bend
was one of the original 28 zones, only 13 of which exist today. Our UEZ income once
over a million dollars a year is now around $150,000. Nonetheless, the major program of
our UEZ, the business incubator, still houses and collects rents from 35-38 businesses.
Because of high operating costs,however there is a negative cash flow and the building is
listed for sale.
Initial Council questions from Dr. Varner and Dr. Ferlic focused on the likelihood of the
sale—minimal, and the fate of the businesses there undecided. Valerie Schey was
assured no City tax dollars support the facility. Henry Davis asked who manages the
facility for the UEZ. Lee Slavinskas said for the last 8-10 years it has been contracted
through C.B. Richard Ellis. He further estimated maintenance expenses currently run
about $3,300 mo.
Henry then followed stating he felt the UEZ should be doing more for economic
development in the area. As well,because incubator expenses are so high, the dollars
could be better spent elsewhere. He added the real problem is there is no economic
development plant for the area despite his long-standing requests for the City to devise
one.
Tim Scott reminded everyone that the Council had 3 open positions on the UEZ board to
fill and the Mayor had one.
Karen White said the UEZ Board had appointed an internal committee to open economic
development plan discussions in which all input was welcome.
At that point Gavin Ferlic motioned the bill go favorably. Dr. Ferlic seconded and all
agreed except Henry Davis.
There being no further business to come before the Community&Economic Committee
at this time, Chairperson Henry Davis, Jr., adjourned the meeting at 5:45 p.m.
Res s ectfully bmitted,
Henry Davis, Jr., Chairperson
Community&Economic Development Committee