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HomeMy WebLinkAbout2004-02-25 Business and Economic Development Committee Minutes � � BUSINESS AND ECONOMIC DEVELOPMENT COMMITTEE � TUESDAY, February 25, 2004 Meeting Minutes � Councilors Attending: Gerry Palmer, Frank Farrington, Richard Greene, John ' Cashwell, Anne Allen, Geoffrey Gratwick � Staff Attending: Rod McKay, TJ Martzial, Stan Moses, Steve Bolduc, Kathy Patterson � Others Attending: Bob Guerrette, Mark Torres, 3 UM Students � The meeting convened at 5:15 p.m. 1. ConsentAgenda , a. Community Development Residential Rehabilitation Loan - CHOM — Spruce Run � b. Community Development Residential Rehabilitation Loan — 192 Forrest Ave. � The Committee approved the Consent Agenda. 2. Community Development Loan Application - Penobscot Theater � McKay noted that the Penobscot Community Theater's loan request is over � $100,000 and requires full Council approval. The Community Development Block program guidelines dictate that the City may loan money to non-profits at 3% for 20-30 years. McKay said that we can have flexibility in the repayment. He said ' that staff's issue revolve around code issues for public assembly. Staff recommends the loan in order to resolve safety issues such as a sprinkler system, code issues and handicap accessibility. � Cashwell asked if there were any asbestos related issues with this building. Torres said that he did not think so; however the architect said that it would be ' tested for asbestos to protect the construction workers. McKay said that he thought the asbestos problem was resolved 10-12 years ago with the previous loan. Cashwell wanted to know what is holding up the cleanup of the other � building. Barrett said that there have been some environmental issues, and the insurance company has not given the okay for demolition due to the fact that � they are still analyzing the cause of the fire. , , � Barrett asked what terms and conditions Torres and the Penobscot Theater had � in mind. Torres said that whatever the City could afford. He noted that they have had a difficult year; however, the organization is strong. He said that they have established a capital reserve and an operating reserve, to which they are � contributing 10% of their yearly revenue. Guerrette said that they are trying to establish a culturai collaboration with other , artistic venues in the City. He said that the City has had discussions about the role that the theater should play in relationship to the new arena. � Farrington said that we should try to help this very important part of our culture. He asked McKay for clarification between the grant and loan program. And is � there a limit to the money that we can tap into? McKay said that the grant is a federal grant to the City of Bangor, which it receives each year because it is an entitlement community. He said that we receive $1.2-$1.3 million each year in � new funding. He said that we use a lot of this money for loans for property owners to rehabilitate their properties and for businesses and handicap accessibility issues. Our objective is to improve property via loans, and use the , repayments to make more loans. In the past, the Council has come up with creative ways to finance loans for community interest projects. McKay said that � he recommends that we take some interest in the property. Palmer asked for staff recommendation. McKay said that staff recommends that � the Council assist the Theater to the extent we can under the policy guidelines. Barrett said that we are looking for an authorization for the staff to confer with the Theater and return with the specifics of a loan package. McKay noted that , the City has $700,000 available for loans. Farrington added that Torres is a very key component in the success of the � Penobscot Theater. Gratwick appreciated the idea of planning and putting on historicai shows at the � Theater. Cashwell asked about the business plan or financial plan. Torres said that they have a conceptual strategic plan, and that they are working with a � consultant. The Theater is working toward standardizing their accounting practices. Cashwell clarified that they are comfortable that they will be able to maintain an operating reserve. ' The Committee approved having staff discuss details of a loan package with the Penobscot Theater. � r � , � � 3. Staff Briefing on Status of Pine Tree Zone Application Steve Bolduc presented an update on the Pine Tree Zone program. He noted � that the major objectives of the program are to provide new employment opportunities, improve existing employment opportunities, broaden the tax base and improve the general economy of the State. He said that Pine Tree Zones � are a key element of Governor Baldacci's economic development plan. They provide for specific areas of economic opportunity. Development incentives include, sales tax exemption for construction materials purchased for 10 years, � 80% Employee Tax Increment Financing for 10 years, sales tax exemption for purchased machinery and equipment for 10 years, and business income tax � credit. Bolduc said that for financial services companies, development incentives include credit against the insurance premium tax, exemption from TIF limitations, and TIFs. Not all businesses are eligible for Pine Tree Zone benefits. � Businesses must be one of the following categories: financial services, manufacturing, and targeted technologies. Bolduc noted that retail and health care projects are not eligibie. To be a qualified project, a business must certify � to the state that this project would not go forward unless the business received Pine Tree Zone benefits. Bolduc said that jobs cannot be transferred from one location to another within Maine. Bolduc described the zone structure, noting � the impracticality of large contiguous zones and the importance of regional focus and cooperation. Allen asked about revenue sharing. Bolduc noted that this was � not a requirement of the project, but that there would be an outgrowth of regional cooperation. Specifically all of the zones may have up to 20 non- contiguous parcels. All zones will terminate by 2018. ' The meeting adjourned at 6:35 p.m. ' ' � � �' � �