Minutes: Evansville Economic Development: June 2006

CITY OF EVANSVILLE
ECONOMIC DEVELOPMENT COMMITTEE

Minutes

Tuesday, June 20, 2006
Second Floor, Evansville City Hall

5:30 p.m.




1. Roll call. Vice-chair Juergens called the meeting to order at 5:30 p.m. Present: Gene Bass, Roger Berg, John Decker, Cheryl Dickert, Ald. Fred Juergens, James Otterstein, Ald. Tony Wyse (arrived after roll call). Absent: Dean Arnold.

2. Approval of agenda. The agenda, as distributed, was approved without objection.

3. Approval of 5/16/06 minutes. Berg moved, seconded by Dickert, to approve the 5/16/06 meeting minutes as distributed. Approved by voice vote.

4. Approval of 5/23/06 minutes. Berg moved, seconded by Dickert, to approve the 5/23/06 special meeting minutes as distributed. Approved by voice vote.

5. Citizen appearances, other than on items listed below. None.

6. Presentation re: TID #6 location and project plan. Dave Wagner and Greg Johnson of Ehlers & Associates described to the Committee an identification of the parcels of property to be included in proposed Tax Increment District #6, lying east of CTH "M" and both south and north of USH 14. The lands to the south of USH 14, consisting of approximately 96 acres owned by D&D Development, have been annexed into the City, but have not yet been rezoned. By statute, a TIF District of this type must be at least 50% industrial. Approximately 41 developed acres will be industrial, and approximately developed 39 acres will be commercial.

The project plan projects a tax increment of $10,331,000, and assumes a declining tax rate over time. Total project costs are just under $4,000,000, of which $250,000 has been reserved for yet-to-be-identified incentives. The Traffic Impact Analysis presently being conducted for the USH 14/J. Lindeman Drive intersection may properly be included as a project cost. A general obligation bond has been identified as the initial source of funding. Final payout and closure of the district is projected by 2018, three years earlier than the statutory limit.

Phasing of construction of utilities will aid the financial outcome. It was noted that bond proceeds need to be expended within three years of receipt.

The project plan provides for approximately $1,000,000 in special assesments to adjacent property owners to recoup a portion of the infrastructure costs. A special assessment mechanism will allow the bonds to retain tax-deductible status, whereas reliance on developer guarantees alone might not. As an incentive to particular development, the City could waive or forgive special assessments.

7. Presentation re: potential biodiesel manufacturing facility. Mike Robinson and Jeff Pieterick of North Prairie Productions, and Randy Kyle, representing Landmark Services Cooperative, furnished the Committee with information on negotiations between North Prairie and Landmark relative to the potential siting of a biodiesel plant on land owned by Landmark east of CTH "M" and south of the Union Pacific Railroad. The plant would produce biodiesel fuel via a chemical reaction between soybean oil and methanol in the presence of a catalyst. The reaction produces biodiesel fuel, and glycerol as a byproduct.

The energy yield of biodiesel is significantly greater than that of ethanol. Exhaust emissions from biodiesel are considerably less than those from petroleum diesel fuel. Biodiesel can readily be blended with petroleum-based diesel fuel, and can be transported and stored in existing facilities. It can be used in existing diesel engines, at any blend rate, without the need for any modification to the engines.

The plant under consideration would have the capacity to produce 45 million gallons of fuel per year. Anticipated overall investment is approximately $42 million. Expected employment at the plant is 25 persons, with compensation averaging $50,000 per year. Urban services will be necessary for the plant, thus annexation and rezoning would be required. Tax increment financing also would be anticipated, either by enlarging proposed TID #6, or by establishing a new stand-alone district. North Prairie believes it will need to raise $20 million in equity capital.

North Prairie has been impressed with Evansville's long-standing commitment to alternative and renewable energy resources, as well as its excellent business climate. Existing railroad service, and the fit of the proposed plant within Evansville's Smart Growth and Future Land Use plans also are major advantages. Although 5 or 6 other Wisconsin communities are under consideration for location, Evansville is North Prairie's favored location.

Landmark has expressed an interest in constructing a soybean crush facility, which could conveniently supply feedstock to an adjacent biodiesel plant, thereby reducing transportation costs. Of the country's 13 largest soybean-producing states, Wisconsin is the only one without an in-state crush facility. A decision on siting and construction of such a plant awaits publication of a feasibility study.

8. Update on Rural Development Grant. Deferred.

9. Committee Goals and Objectives. Deferred.

10. Review of 1991 First Impressions Survey. Deferred.

11. Committee Organization and Projects. Deferred.

12. Adjournment. Berg moved, seconded by Bass, to adjourn to the regular July 18, 2006 meeting commencing at 6:00 p.m. Approved by voice vote at 7:30 p.m.


Respectfully submitted,