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<br />M M artinsville <br /> <br />City Council <br />Agenda Summary <br /> <br />Meeting Date: <br />Item No: <br />Department: <br />Issue: <br /> <br />August 29,2006 <br />2. <br /> <br />City Manager <br /> <br />Discussion and consider approval of an agreement with the <br />Lester Group to partially reimburse private expenditures for <br />improvements to Franklin Street. <br /> <br />Summary: <br /> <br />The Lester Group, which owns the "Commonwealth Center" requests that the city relocate Franklin Street <br />and all City utilities several feet to the west of its current location. The requested relocation would allow <br />the Lester Group adequate room for the construction of an outside elevator and other improvements. <br /> <br />Tier Enterprise recently moved in the southern portion of this building. They spent $320,000 in renovation and <br />installed over $1,000,000 in equipment. It is believed Tier will expand with additional contract work as well as <br />other companies locating in the building if there is an elevator that will meet ADA requirements. In addition, the <br />Lester Group believes that with an additional $3,000,000 invested in renovation they ....111 be in position to <br />attract at least 500 additional jobs to the area. <br /> <br />The Lester Group requests that Council consider a "Public Private Partnership" to address the street and utility <br />relocation. Estimated cost for the work is as follows: <br /> <br />o Water/Wastewater <br />o Street <br />o Overhead Electric <br />o TOTAL <br /> <br />$ 70,000 <br />$150,000 <br />$ 66,000 <br />$286,000 <br /> <br />50/50 Partnership = $143,000 <br /> <br />Justification for participation by the City is the new tax base and new jobs recently created by Tier. The Lester <br />Group believes that additional new jobs will be created once they have completed these improvements. The <br />attached spreadsheets reflect new tax revenue received or potential new tax revenue for the fIrst three years <br />(usual term for incentives). <br /> <br />Currently there are 110 jobs associated with Tier Industries. To date improvements to the Lester property totals <br />over $300,000 along with over $1,000,000 in equipment. With the proposed improvements the Lester Group <br />will invest over $3,000,000 with the possibility of attracting over 500 new jobs. <br /> <br />Funding for the project would be available from the sale of the Cahill farm property. The sale proceeds of the <br />land and timber rights are between $428,000 and $450,000 depending on how Council awards the bid. <br /> <br />Recommend the City participate in a "Public Private" partnership for the purpose of relocating and improving <br />Franklin Street. The City will provide 50% of total project cost not to exceed $150,000. <br /> <br />Attachments: <br /> <br />Spreadsheets A-C <br />Bid Tabulation Sheet <br /> <br />Recommendations: <br /> <br />Motion to approve <br />