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HomeMy WebLinkAbout08-19-82 Human Resources & Economic Development olummtfnr Erpurt Mu tip Qinmmun QlounrUl of tlir Qiiig of guutli HUMAN RESOURCES AND ECONOMIC DEVELOPMENT The August 19 , 1982 meeting of the Human Resources and Economic Development Committee was called to order by Councilman John Voorde at 4: 30 p .m. in the Council meeting room. Persons in attendance included Councilmen Beck, Crone, Voorde, McGann and Harris , Nelson Abrahams , (Robertsons) ,Dale Dutoi (Robertsons) ,Larry Mohler (Robertsons) ,Glenda Rae Hernandez (CAC) ,Kevin Horton (Redevelopment) , John Solbeck (CAC) , Eugenia Swartz, Philip D. Crone (UAW CAP Council) , Eli D. Miller (Chamber of Commerce) , John Mulkey (AFL-CIO) , John Kagel, Jim Cronk, Rebecca Marr, and Kathleen Cekanski-Farrand. Councilman Voorde began the meeting by having each individual introduce himself. Following this , Councilman Voorde stated that the meeting was called to review three bills , namely Bill No. 86-82 (Enabling legislation to set up a local development corporation) , Bill No . 88-82 (A bill to appropriate $500 ,000 to the LDC) , and Bill No . 89-82 (A Bill to appropriate $30, 000 for Project Future) . The Committee began discussion on Bill No . 89-82 which would appropriate 00,000 from the city's Community Development Block Rent for Project Future. It was stressed by Eli Miller that the goals of Project Future are three-fold: (1) To encourage new jobs , new businesses and new industry, (2) to assist in the retention of jobs , business and industry already located within the St . Joseph County area, and (3) To help business and industry in the local area grow and expand. Mr. Crone questioned whether the commitment on behalf of the City was a five-year commitment. Mr . Eli Miller stated that Mishawaka was to propose $15, 000 annually for a five year period, that the City of South Bend would propose $30, 000 annually for a five year period, that the St . Joseph County would propose $35, 000 annually for a five year period and that the State of Indiana through the Department of Commerce was Proposing a one year commitment of $60, 000 . Due to the legal restraints , the municipal entities could not appropriate for more than a one year period, but that the request would be made annually. The local government commitment to Project Future over a five year period would be $400, 000. Following further discussion, Councilman McGann made a motion seconded by Councilman Crone that Bill No . 89-82 go to Council favorably. The Motion passed 3-0. The Committee then reviewed 86-82 and 88-82 . Kevin Horton gave background information on the local development corporation (LDC) . He stated that it is a concept from the Carter administration to create a quasi-public development organization. Ideally it would have leaders on the Board from neighborhood groups , government organizations , the Chamber of Commerce or a similiar entity, and housing. The Baltimore Development Corporation was cited as an example. • /R[( •R[U• PUBUSNINO CO. Page 2. Human Resources and Economic Development Kevin Horton then reviewed the Urban Development action grant program which requires repayment. Examples would include the 1st Source Center and the Ethanol Plant which has been in the works for two years. Councilman Voorde then passed out copies to the Committee of the Articles of Incorporation of the South Bend Development Corporation which were filed with the Secretary of State on August 18th. Councilman Crone questioned the 75% requirement of residency or doing business in South Bend of the membership . The Committee was informed that this is an SBA minimum requirement. She and several other Councilmen voiced concern of having the 23 initial members being chosen by the Mayor. John Mulkey voiced similiar concern, and stated that several of the members did not even known that they had been appointed. Mr. Crone questioned wh.yr.edevelopment could not act in the capacity that the not-for-profit corporation was being proposed for. He stated that it seemed analogous to "playing a game of charades" and "laundering money" . Kevin Horton stated that Community Development can give direct loans , however that the City could not do it directly. Mr . Crone added that it is the responsibility of public elected officials to oversee public funds , and this should be maintained. Councilman Crone questioned why Southhold could not be used to work in the capacity proposed for the LDC. Mr. Horton stated that it was more neighborhood based and did not have the same scope as the LDC . Glenda Rae Hernandez stated that CAC held a meeting on August 18th recommending approval of the $500, 000 conditioned on a guarantee that present employees be retained and that the corporation must bargain in good faith with any existing union. (Copy attached) Councilman McGann questioned whether both groups involved with the Robertsons situation had been given equal opportunity to become involved. He had received complaints over the lack of information being provided the second group . Councilman Voorde questioned why the Common Council 's role was so limited. He had several questions with regard to the Articles of Incorporation, the loan procedures , the length of loans and default of the loans . He specifically objected to the contractural procedures suggested in the Ordinance for the Board of Public Works without Common Council approval . Councilman Crone voiced further concern since in addition to the $500, 000 contained in Bill No . 88-82, she learned from the newspaper that Page 3. Human Resources and Economic Development an additional would he proposed at a later date for the LDC. Councilman Beck stated that the "more she heard the less she liked" . The Council Attorney voiced legal concern over the present wording of Bill No. 86-82 . She noted that although an LDC could be established under Home Rule Legislation, that to eliminate Common Council approval over expenditures "flew in the face of balancing the authority of the City administration and the City legislature under Home Rule" . Councilman McGann stated that he had very similar concerns to those voiced by the other councilmembers , and stated that he would only support such action if: 1) . 50% of the board of the LDC would be appointed by the Common Council;and 2) . That the Common Council would have bottom-line approval of all money. Following further discussion Councilman McGann made a motion seconded by Councilman Crone that discussion of Bill Nos . 86-82 and 88-82 be continued until further information could be provided by the City Administration and proper amendatory language be prepared. The motion passed 3-0. Councilman McGann questioned "equity investment" language contained in Bill No. 88-82 . Mr. Crone stated that there may be an urgency to proceed ahead however that all legal responsibilities should be properly reviewed in light of the Home Rule Legislation and federal law. Councilman Harris voiced his concern over keeping Robertsons Councilman Crone questioned whether there were any other LDC' s in the community? To date there are none however as presently written the money could be given to any qualified LDC . Upon questioning, Mr. Horton stated that he believed that Evansville does make direct loans. Eugenia Swartz then gave further background information behind Bill No. 86-82 . She noted that the Articles of Incorporation were approved on 8-18-82 . Councilman Voorde summarized the committee meeting by stating that the Council has a deep concern to do all that is right and necessary to save Robertsons . However since we were in a new area of legislation, that each of the concerns raised by the Committee should be carefully reviewed. Meeting was adjourned at 6: 30 p .m. Resp lly Su fitted, Jo oorde, Chairman Human Resources and Economic Development