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HomeMy WebLinkAbout01-05-81 Council Special Meeting MinutesSPECIAL MEETING JANUARY 5, 1981 Be it remembered that the Common Council of the City of South Bend met in a special meetin€ in the Council Chambers of the County -City Building on Monday, January 5, 1981, at 7:00 p.m. The meeting was called to order and the Pledge to the Flag was given. ROLL CALL Present: Council Members Serge, Szymkowiak, Beck, Taylor, Kopczynski, Crone, Dombrowski, Voorde and McGann Absent: None RESOLUTION NO. 847 -81 A RESOLUTION OF THE COMMON COUNCIL OF THE CITY OF SOUTH BEND, INDIANA, AFFIRMING THE CITY'S INTENT TO MAKE THE DESIGNATED ETHANOL PLANT SITE IN THE SOUTHWEST PART OF THE CITY OF SOUTH BEND ACCESSIBLE AND BUILDABLE, THEREBY MAKING SUCH SITE COMPETITIVE WITH LOCATIONS OUTSIDE THE SOUTH BEND CITY LIMITS. WHEREAS, the continued development and restoration of South Bend's industrial base is important to the quality of life of the community and is ncessary for the future growth and development of the City of South Bend; and WHEREAS, the proposed One Hundred Forty Four Million Dollars ($144,000,000) Ethanol Production Facility project would contribute to the development and restoration of the City's industrial base by creating approximately 1,0000 jobs; adding very substantially to the tax base; stimulating spin -off economic development activity; bolstering local con- struction activity by providing approximately 500 construction jobs; and maintaining and intensifying momentum necessary to market successfully South Bend as a good location for private investment; and WHEREAS, a site has been proposed for locating an ehtanol production facility within the City ofSouth Bend, which site and surrounding area require development and prepax4t on to make the site competitive with locations outside the City. NOW, THEREFORE, BE IT RESOLVED that the Common Council of the City of South Bend, Indiana: SECTION I. Hereby finds that the development and restoration of the City's in- dustrial base by means of site development and extension of public utilities and improve- ments for use by private corporations is a proper public and governmental function; and SECTION II. Hereby establishes the intent and commitment of the City of South Bend to pursue all necessary and reasonable means to make the designated Ethanol Production Facility site accessible, buildable, and thereby competitive with sites in other locations and SECTION III. Hereby supports the pursuit and procurement of the financial resources necessary to prepare the site and roadway through soil stabilization, excavation, and backfill; to relocate overhead electrical transmission lines; and to do all other things necessary to make the site accessible, buildable and competitive with sites located else - where. On -site development costs shall be assessed against New Energy Company in any conveyance or other financial arrangement to be developed, and such on -site development costs are understood to total approximately Two Million Dollars ($2,000,000). SPECIAL MEETING JANUARY 5, 1981 SECTION IV. Hereby declares that such resource procurement efforts shall include but not be limited to the submission of an application to the Department of Housing and Urban Development for Section 108 Loan Guarnatee Assistance. The Section 108 Loan Guarantee shal be secured by South Bend's Community Development Block Grant annual allocation. SECTION V. Hereby supports and is in favor of obligating other resources as available, to meet the commitments established in this Resolution; and supports the continued pursuit of an Urban Development Action Grant from the United States Department of Housing and Urban Development; SECTION VI Declares that this Resolution shall be in full force and effect from and after its adoption by the Common Council and approval by the Mayor. /s /Walter M. Szymkowiak Member of the Common Council * ** SPECIAL CALL FOLLOWS RESOLUTION CALL FOR A SPECIAL MEETING OF THE SOUTH BEND COMMON COUNCIL I am calling a special meeting of the South Bend Common Council to be held Monday, January 5, 1981, at 7:00 p.m. in the Council Chambers on the 4th Floor of the County -City Building. The purpose of this special meeting is to consider and hold a public hearing on a Resolution entitled: RESOLUTION OF THE COMMON COUNCIL OF THE CITY OF SOUTH BEND, INDIANA, AFFIRMING THE CITY'S INTENT TO MAKE THE DESIGNATED ETHANOL PLANT SITE IN THE SOUTH - WEST PART OF THE CITY OF SOUTH BEND ACCESSIBLE AND BUILDABLE, THEREBY MAKING SUCH SITE COMPETITIVE WITH LOCATIONS OUTSIDE THE SOUTH BEND CITY LIMITS. I received the attached Call for a Special Council Meeting January 2, 1981. I served this Call by reading it to each Councilman on that date. /s/ Joseph T. Serge /s/ Walter T. Kppczynski Joseph T. Serge Walter T. Kopczynski /s /s Walter M. Szymkowiak Walter M. Szymkowiak Beverly D. Crone Beverlie Beck Richard C. Dombrowski /s/ John Voorde Lewis McGann John Voorde -- - Robert G. Taylor )r by leaving a certified copy thereof at the last and usual place of residence of such member: is I was unble to find as follows: 's/ Richard C. Dombrowski /s/ Robert Taylor 's/ Lewis McGann Is Beverly D. Crone 's/ Beverlie Beck /s/ Cpl. James T. Moreland #279 Member of the South Bend Police Department ,Be it remembered that the Common Council of the City of South Bend met in a special meeting in the Council Chambers of the County -City Building on Monday, January 5,1981. at 7:00 p.m. The meeting was called to order and the Pledge to the Flag was given. ROLL CALL Present: Council Members Serge, Szymkowiak, Beck, Taylor, Kipczynski, Crone, Dombrowski, Voorde and McGann Absent: None A public hearing was held on the resolution at.-this time. Mayor Roger 0. Parent, indicated he was asking the City Council to make a strong commitment that we do want the ethanol plant in South Bend and we are willing to make the necessary financial sacrifice. He indicated that the site selected was zoned heavy industrial, it has railroad access, highway access, it was close to a large majority of the working population in this County, and this was just . some of the reasons why this site was selected by New Energy Corporation officials as well as the City Administration. He indicated there were two ways the City encouraged New Energy Corporation to locate in South Bend; the first way was through tax abatement, which gives reduced property taxes over a ten year period; the second way was to tell them that we would make the site economically competitive with sites located elsewhere (making the site accessib and buildable.) He indicated that New Energy asked the City for a commitment, and we initiat the process of tax abatement, we prepared and submitted to the Federal Government an applica- tion for an Urban Development Action Grant. He said we have not yet received word from SPECIAL MEETING January 5, 1981 from the Federal Government that we have been awarded this Urban Development Action Grant, therefore that application cannot suffice as a commitment from the City. New Energy has asked for a binding commitment that the City would fulfill all of the things we said we would do. He said the Administration suggested as an alternative a resolution from the City that would not be binding, but would be a public statement and commitment that we wanted the plant in South Bend, and would seek all available means to pay for making the site both buildable and accessible. He indicated that would suffice for the time being, and New Energy was meeting with the Department of Energy and they will tell them that the City will make that site equally competitive with other sites. He indicated it was not going to be easy for the City to fulfill their commitment, but we think we have devised a way. He indicated that when_ they met in Washington, D. C. they were able to negotiate the total amount down from 6.6 million to 5.6 million. He indicated the City's proposal is that we borrow through the Community Development Program, what is called a 108 Loan Guarantee, the total amount of money and the loan will be paid back through the Comm- unity Development Block Grant allocation we receive on an annual basis. He indicated we receive 4 million a year from C.D. Funds and we can utilize a portion of these funds to pay back whatever loans we make through this 108 Loan Guarantee. He indicated this is going to hurt the City because the only way we can do it is to borrow money through the Community Development Program. He indicated it was going to take away the flexibility we have had in the past because we will be committed to almost our maximum limit. He indicated there was a 5.6 million cost to do all of the on -site improvemnts we are also going to assess New Energy Corporation 2 million for the on -site costs. He indicated they have not yet determined the interest or the time period, but it was estimated the interest would be 6 to 10 percent and maybe a 6 to 10 year pay back period. He indicated this was nothing more than the City has done in the past when we have committed for new industry, such as the Airport Industrial Park. He indicated they were not sure New Energy would receive their loan guarantee, so even if we make another public commitment, in fact the plant might not build here, if they do not receive their loan guarantee. He indicated it was very im- portant to the City that the plant build here, as there will be approximately 500 construc- tion jobs at the building peak, there will be a significant impact on the farmers in the area, as well as the citizens of South Bend. He said a large amount of the construction will take place on -site and we hope the number of jobs that will be triggered by the plant will be close to 1,000. He indicated it was also a new kind of energy that will stimulate other type of developments. He indicated this resolution should be amended in Section 5 to read; "Hereby supports and is in favor of obligating other resources as available, to meet the commitments established in this Resolution; and supports the continuted pursuit of an Urban Development Action grant from the United States Department of Housing and Urban Development;" Council Member Taylor made a motion to amend the resolution, seconded by Council Member Dombrowkki. The motion carried. Mrs. Jane Swan, 1706 S. Walnut, indicated that she was not for or against this project at this point. She indicated when this started she thought it was great, however, it seems to be running into problems. She asked if Community Development funds were used was that going to short change the neighborhoods. She asked the Council to make sure on this issue that what is done is going to be in the best interest of the citizens of South Bend. Mayor Parent indicated he could not think of anything more positive than having New Energy Corporation in the City. He indicated they will pay, the first year after tax abatement, 3.7 million in property taxes. He said this is the type of industry that is going to be important for the next thirty to forty years. He indicated we have to be able to make a positive step forward to support this plant. Jon Hunt, Administrative Assistant to the Mayor, indicated that in terms of the Community Development Block Grant applications, they examined the Community Development budget in term: of the impact on neighborhood and housing programs and other on -going programs. He indica- ted that from 1975 to 1981.the City has committed 82 million dollars to Economic Development Programs; i.e., Monroe /Sample, East Bank, Century Mall. He indicated they do not feel they are going to disrupt any of the neighborhood or housing programs. He commitment to pay back the 108 Loan Guarantee is what we have being doing with other projects the last seven years. Council Member Serge indicated the reason he was in favor of this project. He indicated it will cost 50 million to build this plant, and our local unions would lose the work if the plant was not built in South Bend. He indicated that if the plant was built 15 miles from here, Chicago unions will benefit. He indicated that taking away 50 million in the labor market is taking away a lot of money from our local citizens. He indicated he thought this was a wise investment. Council Member Taylor indicated that if the New Energy Corporation was successful in obtain- ing their loan guarantee, and if they are successful they are going to build an ethanol plant either in South Bend,. Indiana or Rolling Prairie. He indicated he was elected to the South Bend City Council and a vote against this tonight would indicate to New Energy that we are not interested in having them in our Community and it would be an automatic signal to them to build in Rolling Prairie. He said as a South Bend City Councilman (Taylor) he wanted to go on record as strong as possible that he wanted New Energy Corporation to come to our community and that he would do everything in his power to assist them in that goal. Council Member Kopczynski indicated that he felt New Energy Corporation would be an oppor- tunity for South Bend to diversify its industrial base for a long time to come. He indicated he felt it was an industry that will stabilize the employment market. He indica he felt this::was_..an-opportunity that South Bend should not bypass. He made a motion that Council adopt this resolution, seconded by Council Member Taylor. Council Member Dombrowski indicated this plant will be a very good thing for South Bend. Council Member Beck indicated this plant Member Szymkowiak indicated this was not encourage other manufacturers to come to was a financial commitment that the City our representatives in Cashington, D. C. Bend, as Congressman Brademas and Senato will be a big asset to our community. Council only going to be a great asset, but it will the City. Council Member Voorde indicated this cannot easily make, and he would urge publically to work as vigorously for the Citizens of South r Bayh did when they were there. ryp , G..7 SPECIAL MEETING JANUARY 8, 1981 Council Member McGann indicated we have a commitment to not let this opportunity get away from the City. He indicated they would have to find some way to come up with the money to fulfill these public improvements without decreasing the services we are rendering at this time. The resolution was adopted by a roll call vote of nine ayes. There being no further business to come before the Council, Council Member Taylor made a motion to adjourn, seconded by Council Member Dombrowski. The motion carried and the meeting was adjourned at 7:50 p.m. ATTEST: ATTE . CITY CLERK PRESID NT