Chairperson Casey continued that City Council had recently met |
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regarding the project, and the majority of the members were in favor of |
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using EDC bonds in a unique proposal as a way to fund the project. The |
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EDC would issue the bonds and ultimately own the building. The City |
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would deed the land to the EDC on a land contract, but the EDC would not |
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pay any money to the City for the land until the bonds had been retired. |
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From the 16th year of the lease, the EDC would pay the revenues |
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generated from the project directly to the Water and Sewer (W&S) Fund, |
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from which the land was originally purchased. That was a critical issue for |
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City Council, given the fact that the land value today was not nearly as |
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high as what was owed to the Water and Sewer Fund. This method made |
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a lot of sense; the company would generate savings on the bonds, and |
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the City would generate enough revenue to repay the W&S fund. At the |
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end, the EDC would own a building and the land. It could continue to |
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lease it or sell it beginning in the 16th year. The company was willing to |
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commit to a 15-year lease, with two five-year extensions. |
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Chairperson Casey believed the process would be a natural role for the |
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EDC. There would be 302 new jobs transferred to Rochester Hills and 50 |
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new jobs created. The cost for the building was estimated at $14,500,000, |
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and the proposed bond issue was $16,000,000. Mr. Anzek explained that |
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the $14,500,000 was a working number based on a program analysis of |
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the spatial requirements, and the company wanted another $500,000 for |
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onsite retention. Chairperson Casey asked if there were any questions. |
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Mr. Seabright asked the product/process that would be used. |
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Chairperson Casey stated that it would be a corporate headquarters and |
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research and development facility. There would be four stamping |
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presses used for prototype development; they might also do some limited |
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production runs for local customers on an as needed basis. The building |
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would house the engineering, administrative and technical staff. Mr. |
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Seabright asked if they would use any hazardous materials during testing, |
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which Chairperson Casey denied. Mr. Anzek mentioned that the |
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company began by manufacturing truck chassis and had evolved into |
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other commercialization, such as solar panels and R&D development. |
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Mr. Seabright pointed out that the property was low, and he was |
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concerned about flooding. He asked who would be liable for fire or other |
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disasters. Chairperson Casey advised that the company would be |
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responsible for all building maintenance costs, insurance and property |
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maintenance. He agreed that the property sloped, but said that it was not |
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in a flood zone. Mr. Seabright asked about fire or wind damage, and Mr. |
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