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Agenda 2014 11-17 Special MeetingNEW HANOVER COUNTY BOARD OF COMMISSIONERS SPECIAL MEETING WITH WILMINGTON CITY COUNCIL New Hanover County Historic Courthouse 24 North Third Street, Second Floor Assembly Room Wilmington, NC 28401 o AGENDA a�RL� NOVEMBER 17, 2014 12:30 PM MEETING CALLED TO ORDER New Hanover County Board of Commissioners by Chairman Woody White Wilmington City Council by Mayor Bill Saffo ITEMS OF BUSINESS 1. Opening Comments by Chairman Woody White 2. Opening Comments by Mayor Bill Saffo 3. Progress Updates on Priority Items with Discussions Facilitated by Dr. Thom Porter and Jim Roberts a. Film Incentives —) i y I `t = 9 i �O'� ` //,,v s1 S f4ed reL4e b. Three County Micro - Marketing Alliance s 1 (L"- +o," Mc rka�� c. Rebuild NHC (Water & Sewer Along 421 Corridor) d. Supporting New and Small Businesses e. Developing a Realistic and Sustainable Written Incentive Policy f. Making the Case for Sustainable Funding Sources 4. Commission and Council Questions & Answers 5. Adjourn Estimated to Adjourn by 2:30 PM 'i - G o ,�,��.r Cam'', r Wilmington Regional Marketing lnitiative . UJ,'1Vm ,S -4-�e f North Carolina's Southeast Regional Economic Development Partnership (NOSE), the Brunswick County Economic Development Commission (BEDC), and Wilmington Business Development, Inc. (WBD) have formalized a collaborative strategic marketing plan. This plan seeks to continue the economic development efforts of the three respective organizations by implementing value -added marketing strategies in order to generate economic opportunities for Brunswick, New Hanover, and Pender counties. The vision of this marketing initiative is to leverage resources and regional assets by which to market the Wilmington Region to targeted business sectors that might consider the area as an optimal business location. These assets include: • Diversified existing industry and manufacturing base, including Fortune 500 companies • International Port of Wilmington • UNC- Wilmington • Cape Fear and Brunswick Community Colleges • Dynamic logistics and transportation network, including 1-40,1-140, and Highway 74/76, US Hwy 17 and US Hwy 421. • Wilmington International Airport (ILM) • Three newly developed and certified mega industrial parks, including the International Logistics Park of NC, Mid - Atlantic Industrial Rail Park, and the Pender Commerce Park • Cutting -edge marine science research center • Dependable energy suppliers, including two energy plants • Major military installation (Military Ocean Terminal at Sunny Point) and nearby Camp Lejeune • Skilled, trained and available workforce (Right to Work State) • Exceptional coastal quality -of -life NCSE will facilitate the marketing initiative, which will be a collaborative effort among the three organizations in representation of the three counties and the larger southeast region. Other organizations that could play a role in the initiative include the NC Ports, Wilmington International Airport, community colleges, utility firms, and the NC Biotechnology Center, Southeast office. This initiative is not intended to replace existing, local marketing efforts but to strengthen and align marketing for the micro - region through teamwork and focused strategies. All promotional /marketing materials will provide strong evidence of the relevance and solidarity of the three coastal counties and to the crucial role that they each play in the economic development future of southeastern North Carolina. Marketine Strategies 1. Target business sectors for marketing the Wilmington Region, which includes sectors specified in the Garner Economic Report and by the participating economic development organizations: • Food & Beverage Production • Aviation & Aerospace (including Aircraft Assembly & Maintenance) • Metal Fabrication (Precision Manufacturing) from Garner Study • Industrial Biotechnology (including Life /Marine Sciences) Secondary sectors include Plastics, Distribution and High Value Office Operations 2. Conduct email marketing campaigns to identified business sector companies and to national and international site selectors. 3. Conduct recruiting missions to meet with companies and consultants in the targeted business sectors. 4. Work with the NC Ports to enhance marketing of the "At -Port Model" for economic development. This model includes working with companies that need close proximity to the Port of Wilmington for logistics and transportation cost advantages. A primary focus will be marketing the shovel ready industrial parks and sites that are within a 20 mile radius of the port. 5. Participate in relevant marketing and industry events and trade shows that align with the targeted sectors. 6. Conduct a site consultants Familiarization (FAM) tour of the Wilmington Region 7. Consider a sponsorship and presence at the 2017 Wells Fargo Golf Championship to be held in Wilmington. 8. Develop a customized marketing brochure and other collateral materials. 9. Develop, implement, and monitor performance metrics of these strategies. Metric 1 Marketing strategies completed Metric 2 — Number of companies contacted Metric 3 — Resources leveraged Metric 4 — Leads generated Metric 5 — Product recommendations made 10. Conduct periodic performance reporting back to organizational boards and county governments When the initiative generates a business lead and the company visits the Wilmington Region, it is understood that WBD and /or BCEDC will provide the leadership necessary to work with the company. NCSE will provide further assistance and /or support as requested by WBD and /or BCEDC. This marketing initiative has been developed partially as a result of certain recommendations from recent studies that have evaluated economic development approaches for the micro - region. The Wilmington Regional Marketing Initiative is a new and innovative approach to proactively market Pender, New Hanover, and Brunswick counties. It will foster collaboration and greater outreach to site selectors and companies that may have interest in evaluating the area for potential locations. This proposed marketing initiative would also provide a platform for the organizations to collaborate together on marketing by leveraging resources and building on mutual, competitive assets previously listed. Regional Economic Development Partnership Greater Wilmington Micro - Region Marketing initiative 2015 -2017 For Brunswick, New Hanover and Pender Counties ReBuild New Hanover County Bringing Water & Sewer to the US 421 Corridor Beth Schrader Lisa Wurtzbacher =` Administration — County Manager's Office New Hanover County US 421 Corridor W"� i 11/16/2014 November 17, 2014 1 1 384 Acres Food Processing, Precision Mfg., Cold Storage `r 2 420 Acres Distribution, Heavy Equip., Pet Food, Pharma, Chemical, Precision Mfg, Injection Molding, Boat Bldg. t 3 57 Acres Tool & Die; Metal Fabrication, Cold I Storage ' 4 98 Acres High Value Office Cps. / HQ l'ei� s 5 13 Acres Service Companies; Small f Warehouse #acilities; Boat Bldg. �- - November 17, 2014 Slide 2 1 Administration — County Manager's Office r Now Hanover County Primary Service Plan • FM spine to serve customers by pressure connections I B _.c• 5 • Most parcels will connect to sewer As on-*Me private pumps 'F_T • water spine to serve foreseeable demand • Expandable with minimal investment for Buildout Horizon i -- e Budgetary Estimate Primary Service Plan: $12 Million Future expansion to Buildout Horizon: $3L5 Million Administration a County Manager's Office New Hanover County 11/16/2014 November 17, 2014 r� Slide 3 November 17, 2014 Slide 4 F�- .;' I,•' �~ a 'r ! Legend eeerngrur. snpeua Vrrp c,eten p� r� Slide 3 November 17, 2014 Slide 4 Estimated Project Cost Phase 3 Leg A $ 5.0 million Leg B $ 4.5 million Leg C _x_2.5 million Total $12.0 million Administration — County Manager's Office New Hanover County 11/16/2014 November 17, 2014 Slide 5 Many Different Funding Options Estimated Project Cost: $12 million Est. Interest Rate Est. Total Debt Service Annual Avg. Debt Service Required Investment for NHC Property Tax to Cover Annual Avg. Debt Service $144 MM in investment is — 3 -5 Projects Administration — County Manager's Office New Hanover County 3.267% 15,957,129 $797,856 $144,017,409 November 17, 2014 Slide 6 3 0 V L Q 3 a, Z L L... Q.i 0 a, 0 �S V CU N a � V � N cu so V 4 O 4-J W ca ca �(A 1D Ilt Iri O N n a-I L 0 V 0 u C C a c 0 U O t4 2 z Ln 14 LJ Qj (1) � 0) a o a a a t� Re M � to Cl) em -t QP e-4 N M L 0 o N q. n 4:* Ln 1 \ r I ,j 7 I.- i "tom;, , � � N V p N LL. 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', S� = A. 5wS,tw;). - rlj 0:1 T, Gvma p, At rogt, KiN, I DO E5ii 31 . wtal Ic De.. i- f, a UFD. ', S� = A. 5wS,tw;). - rlj 0:1 T, Gvma p, At rogt, KiN, I SUPPORTING NEW AND SMALL BUSINESSES "LOW HANGING FRUIT" Small Business Technical Assistance Create a single point of entry into government processes Phone number, or email address, or ? ?? Business owner triaged to correct location ■ Schedule an appointment Review start-up checklist/process with customer ■ Answer questions and provide direction ■ Staffing needs analysis required Create a better web presence Develop and Publish a Business Resource Guide Provide links to supporting agencies (ABC, SBA, etc) 11/16/2014 1 Author and Consultant on Innovation' The Social Innovation Imperative, McGraw -Hill, 2012 "Creating a Common Language for Cross - Sector Collaboration ", Stanford Socia Review, July 2013 Contributing author to What Customers Want, Tony Ulwick, McGraw -Hill 2003 Steering Committee for the Edison Awards Consultant leading over 100 clients in the US, UK, Spain and Brazil Microsoft (Windows, Office, Xbox, many others), Dell (laptop & rugged solutions), HP (printer group) and IBM (13213 services) Guidant, Medtronic, J&J, Abbott, Assurant, Met Life Mangan Stanley, Assurant, Met Life California Health Care Foundation, Harvard Kennedy School of Government, CIA Cargill, Chiquita, Bosch, Hill's Pets (Science Diet), Hallmark timy= 11/16/2014 2 Focus of Study & Core Team Targeted Audiences f iXa�sSroc6or teem Rusiness New Hanover County City of Wilmington UNCW Research r Organization .i UNCW Center for Innovation Supporting I & Entrepreneurship Investors �rgantzatlans C" Fear Commumdy College Makerspace - -� tekMoutam C6em6er of Commerce 2 "'INNOVATIM ma- Partners 11/16/2014 3 •��77 ':','gin "�: c� �. r, A plan that includes short - term and long -term goals fc small and new business development, to include: • Specific solutions • Timeframe ■ Recommendation for agency assigned to carry out the mission $25,000 total cost to be shared between City and County �� parh�ers 11/16/2014 4 J J Q D Z Q W Z cs z 0 am o. 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F a� Q H a o o G3 Incentive Policy Framework Beth Schrader Strategy & Policy Manager Administration - County Manager's Office New Hanauer County 11/16/2014 aJ8 S November 17, 2014 Successful History - Business Incentives 2014 $ 9MM investment 400 new jobs 2014 $16MM investment 120 new jobs : IAdministration - County Manager's Office New Hanover County 2004 Verizon $20MM investment W[reless 1,000 new jobs 2005 $80MM investment 857 new jobs November 17, 2014 Slide 2 1 11/16/2014 I Garner Report Recommendations Written Incentive Policy 1. Transparency 2. Predictability 3. Common criteria /framework for city and county 4. Tied to desired outcomes Administration @ County Manager's Office November 17, 2014 New Hanover County Slide 2 Recommended Framework Requiring a minimum Exceeding ROI threshold for Several target sectors have low capital capital investment total economic impact investment but provide significant # high wage Jobs Eligible jobs Eligible Jobs Increasing average weekly wage by 10% - Paid at NHC average - Paid 10% above NHC avg. for comparable jobs for comparable jobs Eligible Sectors - Manufacturing (any) - Distribution - HCts - R &D (any) New Hanover County Existing Sectors Plus: - Garner Report Sectors - Transportation - Warehousing - Medical Services -Speculative Industrial Bldgs Modify- - Manufacturing (some) Broadens and diversifies tax base - Creates / retains quality value added jobs (traded) Additional sectors leverage existing assets and have strong wages across spectrum of skills (jobs for all) Identify Use NAICS codes for additional clarity and transparency Slide 4 N 11/16/2014 Recommended Framework Flexible incentive Formula based on the number calculation and wages of qualified jobs Sliding scale; Higher incentive per job for higher wage jobs 10% bonus for Garner Report Sectors Illustration of sliding scale: Incentive amount explicitly tied to more, better jobs Recognizes need for good jobs across spectrum of skills and wage levels Clarity / commitment to growing target sectors Administration — County Manager's office New Hanover County November 17, 2014 Slide 5 Recommended Framework Must involve a facility Must produce (or supply) goods / - Traded clusters bring wealth services mostly consumed outside into the community vs. just Requiring a minimum of 75 new qualified jobs created county re- circulating existing wealth - Not eligible if just replacing an - Desire new jobs vs. paying to existing local business rehire existing workers Requiring minimum of: New - 25 new qualified jobs Existing (Any 2 of 3 below) $500,000 total economic impact - Minimum capital investment - Create or retain minimum # jobs Administration — County Manager's Office New Hanover County - Increased flexibility retaining existing businesses /jobs November 17, 2014 Slide 6 3 Wage Range hr Allocation Per Job $25.00 and above $ 5,000 $20.01 to $24.99 4,000 16.01 to $20.00 3 000 12.01 to $16.00 2,000 Up to $12.00 $ 500 Administration — County Manager's office New Hanover County November 17, 2014 Slide 5 Recommended Framework Must involve a facility Must produce (or supply) goods / - Traded clusters bring wealth services mostly consumed outside into the community vs. just Requiring a minimum of 75 new qualified jobs created county re- circulating existing wealth - Not eligible if just replacing an - Desire new jobs vs. paying to existing local business rehire existing workers Requiring minimum of: New - 25 new qualified jobs Existing (Any 2 of 3 below) $500,000 total economic impact - Minimum capital investment - Create or retain minimum # jobs Administration — County Manager's Office New Hanover County - Increased flexibility retaining existing businesses /jobs November 17, 2014 Slide 6 3 11/16/2014 Retain From Existing Policy Elected body discretion ® Also add ability to consider nonconforming projects with significant # of total jobs Monitoring and compliance Broad use of funds (locally) • Training • Site / infrastructure / leasehold / owner occupied land or building improvements and build to suit • Relocation expenses • machinery and equipment Loans Administration — County Manager's Office November 17, 2014 Now Hanover County Slide 7 Additional Policy Considerations 1. 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I New Hanover County 11/16/2014 1 Potential Uses for Sustainable Funding Debt Service for Infrastructure Project Site Acquisition & Development in Projects Economic Development Incentives Revolving Loans for Capital Total New Hanover county $ 23,000,000 15,000,000 8,000,000 3,000.000 $ 49,000,000 Impact on Taxpayers Op Option Property County Potential need . Impact" Five Year Accumulation 3.3 cents 0.35% Seven Year Accumulation 2.4 cents 0.25 * Impact on annual tax bill for a home valued at $250,000: 3.3 cents = $82.50 2.4 cents = $60.00 �* Current local sales tax rate is 2.25% while combined state and local sales tax rate is 7.00% fNew Hanover County 11/16/2014 2 `f f� .0 d U U u ® 0 .� c E �i .0 U U u ® 0 .� c E �i S. C i� 4 }� ��r 4p LL 1 72 1 vii a, 0 NOW 0 E i� 0 ui &M 0 Y % Y� ��' - f� • G y L E ' 0 %1- RQ VW. 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