HomeMy WebLinkAbout09-01-11 Economic Development Council Minutes, signedCity of Bozeman
Economic Development Council (EDC)
Meeting Minutes
September 1, 2011
10:30 am —12:00 pm
Madison room, City Hall, 121 N. Rouse
Members Attending:
Chris Westlake (Midwest Welding and Machine), Tracy Menuez (Human Resource
Development Council), Cheryl Ridgely (Bozeman Deaconess Hospital), Daryl Schliem
(Bozeman Chamber of Commerce), Chris Mehl (City Commission), Wendy Bay Lewis (Career
Coach/Corp. Trainer), Chris Mehl (City Commission)
Members Absent:
Anders Lewendal (Contractor), Stuart Leidner (Prospera Business Network)
Staff Present:
Chris Kukulski, (City Manager), Brit Fontenot (Director of Economic Development), Aimee
Kissel (Deputy City Clerk — taking minutes)
Guests / Public Present:
Warren Vaughan, County Planning and Economic Development
NOTE: These minutes are not word for word and should be considered in addition to the
audio recording of the meeting.
A. Call to Order — Chair Chris Westlake
Chris Westlake called the meeting to order at 10:34 a.m.
B. Minutes — August 4, 2011
It was moved Ly Cheryl Rid el seconded by Tracy Menuez to approve the minutes of
August 4, 2011.
The motion passed unanimously.
C. Public Comment
None.
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Aliirutc-�s of the Economic Development Cotencil for• September 1, 011
D. Non - Action Items
Primary purpose of this meeting is updates.
The Capital Improvement Program will be discussed by the Impact Fee Advisory Committee the
second and fourth Thursday's in October at 6 p.m. in the Commission room. EDC members
welcome to attend.
• Updated CIP is being drafted now. Impact Fee Committee, staff and EDC provide input.
Look at what development will likely happen first.
• EDC provide a voice from an economic impact perspective for the CIP priorities.
• EDC members can either attend and become involved in CIP during Imact Fee
Committee or wait to weigh in on recommendations..
• Economic development as an additional ranking criteria
• Ground level —
o Brit engaging in the process internally
• Advice from impact fee board
• then bring +CIP draft to EDC for input. Where will the pressure come from the
private sector for the next few intersections? Where do we think development will
head?
1. Foreign Trade Zones (Fontenot —15 minutes)
• idea is to incentivize more manufacturing in our region.
Mr. Fontenot went to Butte and spoke with mgrs of the port of Montana, the only active port in
Montana at the moment. Shelby and Great Falls are dormant. The Butte port has one
international company which imports sand and exports photovoltaic panels. This co. realizes a
huge benefit by being located in this foreign trade zone. Volume is a critical variable. Bozeman
is now looking into two paths; either establishing a standalone zone or establishing a sub -zone.
The sub -zone would take less time to establish and we would be riding on the zone in Butte.
Mr. Fontenot provided the following information:.
• Holding products in a warehouse is another way the port makes money.
• Meeting with Federal representatives and they support the concept and are willing to lend
support letters. Baucus, Tester, Rehburg
• What businesses will benefit, gain their support and then progress. What manufacturers
do we have locally that do enough volume and would be eligible for this zone? Up front
investment by business for tracking, security, accounting. Simplified formula for
manufacturer to help determine if good fit.
• Next phase to speak with Steve Holland at Montana Manufacturing Center (MMC) to
reach out to manufacturers.
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Allhna(� of .Economic Deielopinew Council fin- Septeinher 1, 2011
• Another more refined survey to come.
• Host an informational roundtable about foreign trade zones in partnership with Steve, the
County, feds, business managers
Discussion began among members with the questions:
• Who: Federal Government commission that oversees these zones
• Where: 2 possibilities? Create Mandeville or other geographic area?
• Businesses do not necessarily have to relocate. Butte can pluck acreage out of Silver-Bow
and give it to a sub-zone. Bozeman can then draw a circle around certain manufacturers?
• Spot zones. Can the geography be re-located later?
• Bozeman as a large sub-zone?
• Mr. Fontenot has included State land to the south of Bozeman in his thinking.
• Discussion regarding the savings? What's the real savings? Savings variable on volume.
Has to be a commodity import or value added export.
• Warehousing component is another piece —if import, get cash flow savings where you can
store raw materials in the zone, paying tariffs as you take out the material as needed. (179
days)
• Silver-Bowe may not want to share the warehouse component as they rent space.
• Bozeman has some businesses already that use imported products.
• NAFTA members count?
• Next steps: Get businesses that see value and lobby for the free trade zone. Are there
businesses that could benefit from this?
• If we are supporting growing manufacturing community we are helping them get to the
point where they can realize benefits from this designation. Do we have this capacity or
not?
• Provide a seminar on free trade zones as we have done before on another subject.
Provide info. and help businesses assess whether beneficial.
• MMC, Gallatin County, Prospera partnering to invite large manufacturers that import and
export — use formula. Time frame this fall.
• The Port of Montana in Butte is helping to refine our survey. Send out again to MMC list.
• Geographical area as valley region
• Airport as international designation would be needed for flying materials in/out. New
private company that bought out Jet Center put money in to obtaining international
designation.
• May need to hire a custom agent to help with time elements. How much time will it stay
in port? Shortens cash to cash cycle.
• Bozeman businesses participating in Butte trade zone? May be Bozeman businesses that
warehouse already in Butte. Butte as a crossroads for rail and auto.
• Bozeman has expanding airport, desirable place to live.
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Alffinifes qf'lhe Ecoi)oniic Development 1, 2011
• Multiple companies that use the same product import together?
• Can benefit from a free trade zone in several ways. The greatest benefit is reducing cost
for the company who imports from a foreign company, makes a product and then exports
to foreign company — Does not pay tariff taxes if export within 179 days.
• Second benefit: The company that imports from a foreign company, makes a product and
then sells within US — Pays tariff when they withdraw the raw product from the
warehouse. Delay the tariff tax.
• Managers and businesses that have been making this work in Butte come explain their
business model around foreign trade zone.
• County is supportive of moving forward.
• Designate existing businesses and Mandeville at the same time?
• Applying subzones?
• Local jurisdiction and control where zones are at.
• Expense for the municipality to manage tracking, paying. Make sure companies
following the rules. In the port at Butte this requires a full time staff person.
• Warehouse manufacturing — manufacturers could take advantage of not needing a spur
since railroad goes right through warehouse. Cost advantages
• Mandeville set up a warehousing function to offer service to bring items in for a cost
advantage to manufacturers locally?
• Partner with the railroad to get rail spur in? Railroad will have more traffic.
• As we are marketing / communicating to manufacturers — broaden the appeal. Free trade
zone fora subset of manufacturers who import raw materials from abroad
• Evaluate who would want to bring in train car loads of raw materials and draw those out,
• Collective that would justify a business establishing a warehousing business in
Mandeville.
• MMC can help answer questions with their relationships with manufacturers
• Second survey out before finalizing date on roundtable
• Broaden appeal by looking at reducing input costs. EDC as a catalyst
• If something could help bolster photovotonics industry — some pieces the same. Can they
bulk purchase as a group?
2. Community Development Block Grant (CDBG) Planning Grant application for
Mandeville Farms and DNRC State Trust Land; (Fontenot — 15 minutes)
Mr. Fontenot provided a description of this effort explaining that just to the south of Mandeville,
the state has a mandate to add value to state trust lands that are currently farm land. After recent
articles about the idea of a foreign trade zone, District Manager for DNRC State Trust Lands,
Craig Campbell contacted Mr. Fontenot and they began developing a collaborative effort to
pursue a $25,000. grant to develop a plan. The grant needs a match, so total funds would be
$50,000. This is the same grant the city the city would have pursued alone, changing the acreage
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Afhiwes of ilie Ecoi7oiiiic Developliient Council for Sej)tei)ibe1- 1, 2011
from 300 acres of land instead of just our 86 acres of land. The state agreed to pay 1/2 of the
match if we get the grant. A draft Memorandum of Understanding with the state has been
drafted. Another potential avenue for development on that land is to use a mechanism at the
state level where infrastructure improvements can be made through the state partnership.
Council members began questions and discussion on this topic.
• Money would be spent one of two ways: create a request for proposal to hire a land
planning outfit or potentially access the resources of our planning department and allow
them to come up with the scope of work/plan.
• End result: Document/plan, data comes out of the grant so we can pitch the plan to others
and pursue funding.
• Timeline? Within a year after receiving the grant, required to have the plan finished?
• Collaboration as part of the plan — what can we do together legally?
• The plan would have to show revenue to DNRC.
• Play to strength of topography and geography in place.
• Value in partnership
• $12,500. request in amended City Manager's proposed budget for grant match.
3. Montana Site Selector; (Fontenot — 15 minutes)
Mr. Fontenot explained that a well attended demonstration occurred recently with Park and
Gallatin Counties, Prospera and realtors, especially Tom Starner. The Montana site selector is a
tool for economic developers, business owners and entrepreneurs' to find accurate, timely and
local data for good decision making. It is full of information in layers that are local and pulled
out of the City and County GIS systems. This will allow an overlay of layers on the community
such as, zoning, schools, fire stations; infrastructure then uses the power of Business Power
Online and pulls other relevant data like drive times, income levels and spending patterns
specific to our area. The realtors come in, when identifying commercial properties that are
available for use. The subscription to the program is $10,000 the first year and $5,000 thereafter.
It is proposed that all partners kick in money to pay for it. Another round of questions and
answers is scheduled with the vendor.
Council members began questions and discussion regarding the Montana Site Selector.
o Disadvantages to commercial realtors - they could be inputting same information several
times as they already have a similar realty tool. May be a way to avoid that. There LMS
service is only provided to licensed commercial realtors. This would be free to the public.
Reassurances to the realtors that the website would refer people to the realtor and ensure
the realtor would not be bypassed. Good progress has been made with the realty industry.
Good for the whole.
W411F.,
Himaees of the Econowic Deuelopineur C ouucil16r Selo inter 1, 2011
What's the value for Prospera being involved? 40 reports available through the website
which can become information overload. Prospera's role is to provide the analytics from
the data and advise based on this information
0 County and City advantage — can show what is available.
Montanasiteselector.com is already online. Bozeman will be on the site selector this fall to
winter. The vendor is located in Missoula and was initially funded in large part by the
Governor's office of economic development.
4. Recent Economic Development Activity (Fontenot — 15 minutes)
Mr. Fontenot explained that the Economic Development team consists of expert staff in
planning, engineering, finance, building and fire that at some stage in the development process
would look at and evaluate plans. The team has been made available to developers early on in
their process to answer questions, provide early information, increase predictability, and prevent
surprises. The following businesses / developers have recently gotten great advice when the team
was brought in; providing a sense of trust and response.
a. Ligocyte Pharmaceuticals
Expand with vaccine facility in Bozeman
b. Sitka
R and D and management --- listed as a top 100 employer for last 20 years
c. Downtown Kenyon Noble property
E- Commerce business looking at the property.
The Council began questions and discussion regarding the ED team.
Daryl Schliem reported that the last three meetings with Ted Mitchell, Ted has spoken highly of
the economic development team and been much friendli
Mimaes of the Econoj)dc Developmew Coiaicil,fby-Seplcinber 1, 2011
Mr. Kukulski and Mr. Fontenot were very pleased with the positive responses received from
President Cruzado and the MSU staff regarding several ideas. They spoke regarding exploring
the possibilities of an MSU downtown campus to serve a potentially different population,
Gallatin College role? Continuing ed? Business college? Place downtown for MSU? MSU
Billings has a downtown campus. May take years to come to fruition, but MSU is excited about
the possibility as well.
A monthly schedule has been set for Mr. Kukulski and President Cruzado to meet. Key people
from both the city and MSU will be present at those meetings depending on the agenda.
Mr. Fontenot reported that the topic on MSU staff's mind is the Research park and ATI (for
profit organization that ran the technology park). MSU has been pushing to clean up, simplify,
and recreate a new entity. They are hoping to hire a new executive director soon. Their vision is
a true research park with incubators, accelerators, assistance, synergies, coffee shops and trails -
a business park in function. The City has asked them to continue to engage us to the extent
helpful.
There is a running list of areas where the city and university collaborate regularly (see
attachment).
E. FYI/Discussion
Discussion
Ms, Ridgely said all this is so exciting to see and she thanked the city for making an investment
in Mr. Fontenot's position, To have a person to put all these things altogether and move them
forward is outstanding. The time and commitment has really been worthwhile.
Mr. Fontenot emphasized that none of these projects would have been possible without building
good relationships with folks like Warren Vaughan at the County, other staff, and other agencies
and organizations. This has truly been teamwork. Mr. Fontenot asked members to mention to
other agencies, staff and organizations how important they feel those relationships and
partnerships are.
FYI
1. Mr. Westlake asked for an update on long term ownership for GBRN?
Mr. Schliern said he may have an end user for GBRN's long term ownership. The Chamber
board has established the value.
2. Next steps/agenda items for the October 6, 2011 EDC meeting.
0 Updates on CIP? — Center on CIP discussion
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AlAntles of the Economic Developinent Council fin-Septenther 1, 2011
Question around what role the EDC should play in understanding tech transfer process at
MSU? What's unique about Bozeman — are we maximizing the value of the university in
the economics of the community?
2. Invite MSU's Tech-Transfer to the next EDC meeting?
0 May be premature as they are transitioning at this time,
3. Mr. Fontenot will be out of town for the October 6"' EDC meeting and Tracy
Menuez will not be able to attend that meeting.
4. Concentrate on CIP presentation if the process is far enough along by Oct.
meeting.
5. Mr. Kukulski thanked EDC members for their comments and said he is very
grateful for the quality and amount of work being done and the excellent relationship
building that Mr. Fontenot has been able to accomplish.
6. Warren with the County announced that a meeting will occur on the 8t" at 2 p.m.
in the Community center at the County Courthouse among old economic development
district board members who will reconvene to talk about the possibility of revamping and
reviving that group and who may want to continue to serve.
7. Commissioner Mehl said 10:30 a.m. is not a good meeting time for him and asked
for input from members whether another time such as during the lunch hour would work
for other members.
F. Adjournment
Chris Westlake adjourned the meeting at 12:03 p.m.
*NOTE — Full audio of this EDC meeting is available at:
htLD.Hweblli-,k.bozernan.net/Webl.ink8/0/doc/453 80/Electronic.asl)x
= ---- -- - - ----- -
C is Westlake, Chair
PREPARED BY:
Aim 4e Kissel, Deputy City Clerk'
Approved on: C)cf-of
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Economic Developinent Council ineetings are open to all ineinbers of the public. Ifyou have a
disability that requires assistance, please contact out- ADA Coordinator Jaines Goehrung, at 582-
32.32 (TIT 582-23011).
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