Battle Creek Tax Increment Finance Authority

BATTLE CREEK TAX INCREMENT FINANCE AUTHORITY Tuesday, July 24, 2012 At the special meeting of the Battle Creek Tax Increment Finance Authority held on Tuesday, July 24, 2012 at 3:00 p.m. at the Frederick R. Brydges Customs Cargo Center, the following were in attendance: Messrs. Bobrofsky, Christensen, Cutshall, Czerney, Frantz, Karre, Noble, Scott and Rae. Absent was: Messrs. Bowman, Stewart and Tsuchiyama and Ms. Tuggle. Also in attendance were: Messrs. Dehn, Voshell, and Mmes. Albrant, Beard, B. Jones (Allison Trapp, Little Rainbows Daycare). Mr. Bobrofsky called the meeting to order at 3:00 p.m. APPROVAL OF MINUTES MOTION: Mr. Karre moved that the Battle Creek Tax Increment Finance Authority Board of Directors approve the minutes of the May 15, 2012 meeting. Mr. Rae supported the motion and it was unanimously approved. MOTION: Mr. Rae moved that the Battle Creek Tax Increment Finance Authority Board of Directors approve the minutes of the June 19, 2012 meeting. Mr. Noble supported the motion and it was unanimously approved. ROBBINS BUILDING/CHILD CARE /LITTLE RAINBOWS PRESCHOOL AND DAYCARE Mr. Voshell stated that discussions have been held on costs incurred and the conversion to a condo unit once BCTIFA owns less than half of the building. The BCTIFA currently owns three fifths (3/5) of the Robbins Building. A new operator is interested in acquiring the childcare services that are important to the Fort Custer Industrial Park businesses. Ms. Beard has been in contact with the new operator. The lease to Nicole Lewis expired in April 2012. The lease was extended to the new operator Little Rainbows so that service was not interrupted. Ms. Beard stated that in May 2010, Nicole Lewis opened the childcare facility and leased the facility for two years which expired in April 2012. Due to health issues, the operations was planned to close. Ms. Lewis worked to find someone that would be interested in acquiring her business and lease the space. Ms. Lewis found Little Rainbows, to rent or sub-let on a month-to- month basis. Little Rainbows has indicated an interest on purchasing the space. Little Rainbows is interested in a one-year lease option ($700.00 per month, plus utilities, plus childcare toys, equipment) with an option to purchase the space and belongings for $70,000. Once acquired the new owner as would existing owners have to pay condo fees. Companies currently being serviced by the childcare at the Robbins Building include: Denso, I I Stanley, TRMI, EPI, Johnson Controls and V.A. Medical Center. There are currently 60-65 students that attend. In the event the facility closes in the following three years, it could be acquired by the BCTIFA. The BCTIFA has the right of first refusal. The BCTIFA would receive the payments in principal and terms of installment purchase. Little Rainbows is an established entity in Jackson. Little Rainbows has been in business six and one half years. BCTIFA Board Page 2 – Minutes July 24, 2012 Staff recommends moving forward with developing the contract with Little Rainbows for childcare services at the Robbins Building as presented. The BCTIFA Board suggested an amortization schedule be defined and suggested not longer than 15 years. The childcare facility currently provides services to both first and second shift operations for the Fort Custer Industrial Park businesses. If there is a demand for a third shift operation, the new childcare operator would consider it. Mr. Voshell stated that one Fort Custer Industrial Park company is interested in the childcare facility servicing a third shift operation. In the past there has only been two shifts serviced. A third shift is above and beyond what has been done in the past. Mr. Karre asked if there was a minimum number of youth or an objective measurement for a third shift. Mr. Rae stated that the BCTIFA Board has the obligation to approve the lease as long as all of the requirements are listed. He recommended that a special meeting be held to review and approve the proposed lease for childcare. Ms. Trapp stated that she is currently working to add employees to handle the Saturday and evening shift. TRMI specifically markets the childcare during interviews to its new employees. MOTION: Mr. Karre moved that the Battle Creek Tax Increment Finance Authority Board of Directors authorize staff to negotiate terms consistent with the conversation and return the childcare lease for final approval; the month-to-month lease that staff entered into on behalf of the BCTIFA between Nicole Lewis and Little Rainbows Preschool and Daycare was ratified. Mr. Rae supported the motion and it was unanimously approved. UPDATE LAND EXCHANGE WITH MDOT/WALTERS-DIMMICK Mr. Voshell stated that staff was successful in getting the MDOT to vacate the existing park and ride lot and giving BCTIFA access to the site (not ownership). MDOT approved that staff could clean it up or maintain the site to make the 120-acre BCTIFA site look better. MDOT is not allowed to sell the parcel to the BCTIFA as it must be retained to use for the interchange improvement or expansion. The MDOT park and ride lot would then be relocated to the BCTIFA- owned site that is polluted behind the Walters-Dimmick Shell gas station. Mr. Voshell stated that our attorney Daryl Mumford had worked with the Walters-Dimmick attorney and they appeared to agree to support that plan and build the new parking lot. BCTIFA Board Page 3 – Minutes July 24, 2012 However, most recently the communications provided at the meeting indicated a withdrawl of the Walters-Dimmick support. Mr. Mumford asked that the Board authorize staff to hire an expert real estate appraiser to assist with the diminishing of value/damages question. Staff was directed to work with Mr. Mumford for the purpose of seeking legal counsel versed in the area of land contamination value to make the case and re-approach Walters-Dimmick with the issue. Mr. Karre suggested that we allow staff to work with legal counsel to determine a qualified/competent attorney based upon various scenarios of value: completely clean, partially clean, and polluted. MOTION: Mr. Rae moved that the Battle Creek Tax Increment Finance Authority Board of Directors authorize legal counsel to pursue environmental counsel to seek what is the best course of action. Mr. Noble supported the motion and it was unanimously approved. 10 N. CLARK ROAD UPDATE Mr. Voshell stated that the building had been pulled from the bankruptcy proceedings that USO was involved in. Mr. Voshell attended the auction in Greenville, MI. Mr. Voshell contacted the real estate agent to find out that the bankruptcy judge had agreed to pull the building from the bankruptcy proceedings. The auction included all personal property that the company owned. An offer was made on the building located at 10 N. Clark Road, and declined by USO or the bankruptcy judge as being too low. Mr. Karre stated that USO is still operating in some locations and they do have the ability to say “no” to some things. USO had corporate headquarters in Auburn Hills, MI, but they did not own the building. Mr. Voshell stated that there is also another operation, ENER in addition to USO. There are currently three parties actively pursuing the building. PROJECT UPDATES Project Heavy Metal is a German company and is auto related. Staff has been working with this prospect for the last eight months. Battle Creek was one of 129 communities that received RFIs. Battle Creek is one of three final communities still in the running. Staff will be meeting with the prospect later today. This is an $8 million investment and 60 new jobs. The company has operations in Germany and Brazil. The company is looking for its first North American operation. The company is interested in the former Isringhausen building located at 5450 West Dickman Road. Battle Creek is in competition with Ohio and North Carolina for this project. PUBLIC COMMENTS No comments were made. BCTIFA Board Page 4 – Minutes July 24, 2012 ADJOURN There being no further business, the meeting was adjourned at 3:50 p.m.