BOARD OF DIRECTORS MEETING
County of Chautauqua Industrial Development Agency
CCIDA
201 W Third Street, Jamestown, NY
March 27, 2018
10:00 a.m.
Mike Metzger Chairman
Dennis Rak Vice-Chair
Hans Auer Treasurer
Cory Duckworth Member
Mark Odell Member
Also in attendance:
Rich Dixon CCIDA CFO
Greg Peterson Counsel
Matt Mazgaj Counsel
Michelle Turner VP of Marketing
Carol Rasmussen CCIDA Staff
Kristine Morabito CCIDA Staff
Sue Casel CCIDA Staff
David DiTanna BWB
Patrick McLaughlin Town of Ellicott
Ron Vaughn Salsarons MTC Foods
Katrina Fuller Post-Journal
Absent Board Member(s): Kelly Farrell DuBois, Brad Walters, and Kim Peterson
Meeting was called to order by Mike Metzger, Chairman, at 10:02 a.m.
Mike Metzger
I will now call the County of Chautauqua Industrial Development Agency (CCIDA) Board of Director’s meeting to order. We are meeting at CCIDA, 201 W Third Street, Jamestown, NY. Today is March 27, 2018, (10:02 a.m.)
I will now have roll call.
Dennis Rak – Here, Hans Auer – Here, Cory Duckworth – Here, Mark Odell – Here, and Mike Metzger is here.
Let the record show we have five members in attendance. We do have a quorum.
I will entertain a motion to accept the February 27, 2018, minutes that were sent to you in advance.
Mark Odell
So moved.
Dennis Rak
Second.
Mike Metzger
Any discussion? Hearing none – All in favor indicate by saying Aye.
Ayes all around. The motion is carried unanimously.
Next on the Agenda is a Deviation Hearing for the Housing Preservation, Inc., project.
Matt Mazgaj
The County of Chautauqua Industrial Development Agency has the Uniform Tax Exemption Policy that dictates the property tax abatement available for projects. To deviate from that UTEP policy, in pursuant to the with the general municipal law, we will have the Deviation Hearing today regarding the Housing Preservation Inc. project which is also on the schedule today for SEQRA and Final Authorizing resolutions.
Notices for this Deviation Hearing were sent out to the potentially effected taxing jurisdictions on March 8th, 2018, as attached to the letter was the proposed Pilot schedule.
Is there anyone present?
Patrick McLaughlin
I’m with the Town of Ellicott. Is the 29-year Pilot request required due to HUD financing.
Matt Mazgaj
Yes.
If there are no one else from the potentially effected taxing jurisdictions present, we can call the deviation hearing to a close.
Mike Metzger
We will now have the Audit Report. The Audit Committee had previously met, and approved the draft materials. Now it will be presented for the Board approval.
Dave DiTanna
Gave a brief overview of the Audit process.
Review of the Audit report was given:
Page 1 & 2 is the Independent Audit Report. This states that, in our opinion, the CCIDA’s financial statements are in accordance with accounting principles generally accepted with no exceptions.
Pages 3-7 are referred to as the management discussion analysis. This section gives a highlight of what happened in the current year compared to the prior year.
Brief review of financials showed, for the most part, there was not a tremendous change from the prior year.
An overview of the Audit was given.
The independent audit letter states no instances of noncompliance that are required to be reported under Government Auditing Standards.
The Management Letter recommends recognition of anticipated revenue in reference to wind farm and LECOM.
The Governance letter basically discusses the Board and BWB’s responsibility. It is a clean letter – there is nothing to be concerned with.
The Staff, Board, and Rich were thanked and congratulated on a very good report.
Mike Metzger
Dave and his staff was thanked for their professional work.
I would like a motion to accept the Financial Report as presented.
Dennis Rak
So moved.
Hans Auer
Second.
Mike Metzger
Is there any further discussion. Hearing none, I will take a rollcall vote.
Dennis Rak – Aye, Hans Auer – Aye, Cory Duckworth – Aye, Mark Odell – Aye, and Mike Metzger – Aye.
Let the record show there are five votes in the affirmative. The motion is carried unanimously.
Let’s move on to new business. Hans, the first Resolution, please.
Hans Auer
Resolution 03-27-18-01
Resolution of the County of Chautauqua Industrial Development Agency Pursuant to the State Environmental Quality Review Act Concerning the Determination of Significance in Connection with regards to the Housing Preservation, Inc., Project.
Cory Duckworth
Second.
Matt Mazgaj
We have three resolutions related to Housing Preservation, Inc. It’s the purchase of six facilities that are owned by affiliates of Lutheran or Methodist in Jamestown or the Town of Ellicott.
This resolution is required for the State Environmental Quality Review Act. It is just the purchase of the property and an unlisted action, with no significant impact. That is the scope of the CCIDA’s involvement.
The second resolution dovetails the Deviation Hearing that we had previously authorizing the deviation as defined in the deviation notice letter sent out on March 8th.
The third resolution is taking official action approving the straight lease transaction which will be a lease/lease back with a PILOT agreement. They are not requesting sales tax abatement or mortgage recording tax abatement. It is purely to define a PILOT schedule which will be 29-years as discussed before.
Carol Rasmussen
Matt covered most of it. We did have a Public Hearing on March 20th. Matt and I were the only ones in attendance.
There are a total of 200 units involved in this project in Jamestown, Falconer, and the Town of Ellicott.
Mike Metzger
Is there any further discussion? Hearing none, I will take a rollcall vote.
Dennis Rak – Aye, Hans Auer – Aye, Cory Duckworth – Aye, Mark Odell – Aye, and Mike Metzger – Aye.
Let the record show the resolution passed with five votes in the affirmative.
Cory, please read the next resolution.
Cory Duckworth
Resolution 03-27-18-02
Resolution Authorizing a Deviation from the Uniform Tax Exemption Policy of the County of Chautauqua Industrial Development Agency with Respect to the Housing Preservation, Inc., Project.
Hans Auer
Second
Mike Metzger
If there is no further discussion, I will take a roll call vote.
Dennis Rak – Aye, Hans Auer – Aye, Cory Duckworth – Aye, Mark Odell – Aye, and Mike Metzger – Aye.
Let the record show the resolution passed with five votes in the affirmative.
Mark, if you’d read C please.
Mark Odell
Resolution 03-27-18-03
Resolution Taking Official Action Toward and Approving the Straight Lease Documents for a Certain Project for the Housing Preservation, Inc., Project.
Cory Duckworth
Second.
Mike Metzger
Any further discussion? I will have a roll call vote.
Dennis Rak – Aye, Hans Auer – Aye, Cory Duckworth – Aye, Mark Odell – Aye, and Mike Metzger – Aye.
Let the record show the resolution passed with five votes in the affirmative.
Dennis, please read resolution D, please.
Dennis Rak
Resolution 03-27-18-04
Resolution Approving an AL Tech Loan for Castelli America, LLC.
Mark Odell
Second
Mike Metzger
Discussion please.
Carol Rasmussen
We had a Loan Review Committee meeting on March 14th for Castelli Cheese. Paul Bensabat and Daniele Zoni, President and Vice-president of Castelli Cheese, were on a conference call for the meeting.
In 2016, Castelli bought Empire Specialty Cheese, and it became Castelli America. The plant was on the verge of liquidation. After Castelli purchase it, they ran in to a few problems which held their profitability back. They spent $3 million in unexpected cost, which delayed their new product line that they had planned for. They are now ready to start their new product line with some new cheeses. They need new equipment for that. They addressed DEC problems to repair and upgrade the treatment plant that cost $500,000. They honored the debts, paid their suppliers $1.4 million. The spent $9 million more than expected to upgrade the plant, and pay off vendors.
This has a local impact. There are 80 Amish farmers that the buy milk from.
Their new equipment line will bring specialty cheese to market, and they feel will increase their cash flow.
Their request if for a $500,000 AL Tech Loan for 10-years at 4%. The collateral on the loan will be a blanket lien position of all of the company assets, accounts receivable, and the machinery and equipment.
Mike Metzger
Any more discussion? I will have a roll call vote.
Dennis Rak – Aye, Hans Auer – Aye, Cory Duckworth – Aye, Mark Odell – Aye, and Mike Metzger – Aye.
Let the record show the resolution passed with five votes in the affirmative.
Hans, please read resolution E, please.
Hans Auer
Resolution 03-27-18-05
Resolution of the Members of the County of Chautauqua Industrial Development Agency to Approve an Assumption and Restatement of D&F Pallet, Inc., Note By Thomas J. Ivory and Richard J. Ivory.
Dennis Rak
Second
Rich Dixon
Last year, in Executive Session, we discussed D&F Pallet. The loan was non-performing. The Ivory brothers had sold the facility and it did not go well. The business went bad, they lost a customer, and they owed their suppliers. The Ivory’s stepped in and took control of the project.
We worked out a deal with them. The Ivory brothers are going to take the company back and start production.
Mike Metzger
Any more discussion? I will have a roll call vote.
Dennis Rak – Aye, Hans Auer – Aye, Cory Duckworth – Aye, Mark Odell – Aye, and Mike Metzger – Aye.
Let the record show the resolution passed with five votes in the affirmative.
Cory, please read resolution F, please.
Cory Duckworth
Resolution 03-27-18-06
Resolution of the Members of the County of Chautauqua Industrial Development Agency Related to Financing of Chautauqua Harbor Hotel, LLC, with Northwest Bank.
Dennis Rak
Second
Matt Mazgaj
This is a 2016 CCIDA project. Approval of Sales Tax, Property Tax, and Mortgage Tax Abatements was approved. We entered into a Lease/Lease Back transaction in December 2016.
They are getting around to financing. As you recall, Hart Hotel is involved in the Chautauqua Harbor Hotel, and they have destination hotels across NYS. At this point, we are working on financing that was anticipated with the straight lease transaction documents. Since they have so many assets, Northwest has requested that there be cross collateralized loans across the four different properties that they own.
So there is going to be a loan $25 Million related to the Chautauqua Harbor Hotel, specifically, and then additional mortgages refinancing on the other properties that will be filed as subordinate mortgage security interest on Chautauqua Harbor Hotel. In turn, the Chautauqua Harbor indebtedness will be cross-collateralized on the other properties, as well.
Mike Metzger
Any more discussion? I will have a roll call vote.
Dennis Rak – Aye, Hans Auer – Aye, Cory Duckworth – Aye, Mark Odell – Aye, and Mike Metzger – Aye.
Let the record show the resolution passed with five votes in the affirmative.
Mark – Updates
Mark Geise
County Executive Borrello sends his regrets. He wishes he could be here. He is on his home stretch of 100 businesses in 100 days. We have all been on a lot of the visits. He plans on coming to future meetings.
Gary Henry, from Fancher Chair, will be joining our Board, filling the vacant Board position.
CCIDA-on-the-Road – we will look in to having 3 in Jamestown, 3 in Dunkirk, 3 at Municipalities, and 3 at Businesses. This will be a good way for the IDA to be more of a presence in the Community. We will try to have a draft for the April meeting.
I would also like an opportunity to call in with questions regarding the Agenda. Getting the agenda out 1 week prior to the meeting, and offering the chance to call in – possibly the Thursday before the meeting – to answer any questions you may have.
The County Executive has also discussed having an Economic Development Strategy. We want to team with the County to hire a firm to help us to inventory what the existing resources are in the Community in terms of Economic Development. Align the resource towards a common goal or county mission. Develop an Advisory Committee of Public & Private entities to help design future policy all in the quest to more efficiently and effectively deliver our services.
Mike Metzger
I would like the CCIDA to take the lead roll and be the steward of this project, if you so approve.
I would now like to move for a motion to go in to executive session to discuss the financial and credit history of certain companies, the potential acquisition and lease of real property by the Agency, and/or personnel matters.
Mark Odell
So moved.
Hans Auer
Second
Mike Metzger
All in favor.
Board Members
Ayes all around.
__________________________________________________________________________________________
Executive Session Begins at 11:08 a.m.
__________________________________________________________________________________________
Executive Sessions Ends at 11:19 a.m.
__________________________________________________________________________________________
Mike Metzger
We are now in open session.
If there is no further business, may I have a motion to adjourn?
Cory Duckworth
So moved.
Hans Auer
Second.
Ayes all around.
Mike Metzger
Meeting adjourned at 11:24 a.m.
__________________________________ _____________________________________
(Assistant) Secretary (Vice) Chairman
