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2001-11-29 CITY OF BEVERLY PUBLIC MEETING MINUTES BOARD OR COMMISSION: Economic & Community Development Council SUBCOMMITTEE: DATE: LOCATION: MEMBERS PRESENT: November 29,2001 Third Floor, City Hall Chairman Joyce McMahon, Brenda Spence, Dick Mooney, Wayne Mastin Don Stacey City Planner I ex-officio member Tina Cassidy, Community Development Manager I ex-officio member Bill O'Hare, former vice-chairman Bill Rodenbaugh Tina Cassidy MEMBERS ABSENT: OTHERS PRESENT: RECORDER: McMahon calls the meeting to order at 6:35 p.m. and asks those in attendance to identify themselves. In addition to the individuals listed above, the following representatives of Electric Insurance Company ("EIC") are present: Denny Doherty from EIC, Attorney Mark Glovsky, David Greenbaum and Ginny McCarthy from EIC, and Dallas Crowell, project architect. Glovsky states that EIC has prepared a brief, three part presentation for the Commission this evening as it formulates a recommendation to Mayor Scanlon on a proposed Tax Increment Financing Agreement ("TIF"), designation of the subject property as an Economic Target Area, ("ETA"), and designation as a certified project. Doherty begins by explaining that EIC currently has 500 employees at two leased facilities in Beverly. The company specializes in commercial and personal insurance. The company leases space at 150 Conant Street, and its growth required the company to lease a second facility on Cherry Hill Drive. They want to consolidate their headquarters into one facility. The company looked at several sites on the North Shore, and decided to pursue a facility in Beverly if possible. The company has many ties to the community, including employees who volunteer time for a mentoring program at the Hannah Elementary School. EIC has donated supplies and equipment to the school as well, and is involved in the Center for Family Development, the Beverly Rape Crisis Center, and Beverly Bootstraps Program. McCarthy explains the details of the TIF IETAI certified project applications. The property being purchased by EIC on Sam Fonzo Drive ECDC minutes November 29,2001 meeting Page two is approximately 28 acres in size and is presently assessed at a value of $750,000. The company plans to build a $20 million facility and spend an additional $5 million in building fit-out. They hope to begin construction in June of 2002 and complete the project by September 2003. The company also plans to add 175 jobs over the ten-year life of the TIF. McCarthy states that at present tax rates, the company would be generating approximately $5,000,000 in tax revenue to the City over the life of the TIF, and the terms of the proposed TIF would forgive a total of only $100,000 over the same time. Glovsky states that the site is located at 75 Sam Fonzo Drive. The 28 acres site contains approximately 11 acres of wetlands. EIC plans to build a 155,000 sq. ft. facility initially, and plans call for a second expansion phase at the back of the proposed facility that would result in an additional 36,000 sq. ft. of building area. The second phase would be built more than five years from now. . Glovsky states that the company received site plan review approval from the Planning Board and an Order of Conditions from the Conservation Commission in October of this year. He notes that the Order of Conditions has been appealed by a group of residents. Despite the appeal, EIC remains committed to the project and hopes that the appeal will be speedily resolved. He asks if there are any questions on the presentation. Mastin asks if any traffic studies have been done. Glovsky states that no traffic studies were done, although the site plans have been reviewed and approved by the City's Parking and Traffic Commission. Cassidy adds that the original Environmental Impact Report prepared for the Sam Fonzo Drive subdivision road was predicated on the assumption that there would be 500,000 square feet of office space in the park. This project, coupled with the two other developments in this subdivision, total much less than that. Rodenbaugh asks EIC to explain why it is seeking a ten year certified project agreement. Greenbaum answers that the primary reason is the second phase of construction the company is contemplating. The second phase would not occur during the first five years, but rather sometime after that. He adds that a ten -year term was negotiated with Beverly's Mayor when EIC was actively negotiating with several other communities ECDC minutes November 29, 2001 meeting Page three as potential sites for this project. The ten-year term distinguished Beverly from the others. Rosser asks Glovsky for clarification on the nature of the appeal of the Conservation Commission's decision. Glovsky answers that the appeal indicates the petitioners believe that the Commission exceeded its authority in approving the project and did not act appropriately to safeguard the wetlands on the site. Mooney asks how many EIC employees are Beverly residents. Doherty answers approximately 70%. Paul Barnico, a member of the airport commission, asks how large the site is and the purchase price. Glovsky answers 28 acres, and the company paid $3,000,000.00 for the land. O'Hare requests clarification of the term "blighted open area" that is referenced in the state regulations for economic target areas. Glovsky answers that the term refers to vacant lots that might exist within an economic opportunity area. O'Hare asks how many construction jobs will be generated by the project. Crowell says that the number will vary depending on the phase of construction, but that there should be the equivalent of fifty full time jobs at the peak of construction. Rodenbaugh states that he has been involved in the work of the master plan steering committee and the recommendations that will be contained in the final master plan report. The citizens who have participated in the master planning process have said they are looking for low-impact industrial uses and support the productive use of land currently zoned for commercial and industrial uses instead of rezoning new areas for these land uses. This project conforms to those wishes. He states that a vote to recommend approval of these applications is in fact a statement to the company that the City would like them to locate in Beverly. He states that the proposed tax break to be given by the City is a minimal one, and he urges the company to remind the City Council of that fact during the approval process. Rosser agrees with Rodenbaugh's statement that the residents have said they want to encourage the maximum redevelopment of existing commercially- and industrially-zoned land, and adds that the Chamber of Commerce feels the same way. While some in the community do not understand the objectives of the EOA/TIF I certified project program, this ECDC minutes November 29,2001 meeting Page four committee sees the long-term benefit to the City. In fact, Rosser states, this proposal meets all of the goals the City and State have for economic opportunity areas and economic target areas. McMahon asks if there are any other questions or comments on the application. There are none. Rosser: Mastin: Rosser: motion to recommend to Mayor Scanlon that he forward the Economic Opportunity Area application of Electric Insurance Company to the City Council for approval, seconded by Mooney. All members in favor, no one in opposition. Motion carries. motion to recommend to Mayor Scanlon that he forward the proposed Tax Increment Financing Plan for Electric Insurance Company to the City Council for approval, seconded by Rosser. All members in favor, no one in opposition. Motion carries. motion to recommend to Mayor Scanlon that he forward the certified project application of Electric Insurance to the City Council for approval, seconded by Mooney. Rodenbaugh suggests that the certified project application be amended to include an affirmative action statement as required by law. Greenbaum states that he will address this issue prior to the day the applications will be sent to the City Council. Rosser amends her motion to include a condition that the certified project application be approved subject to the inclusion of an affirmative action statement. On the amended motion, all members are in favor, none in opposition. Motion carries. McMahon asks if there is any other business for the committee to discuss this evening. There is none. Rosser: motion to adjourn, seconded by Mooney. All members m favor, no one in opposition. Motion carries. The meeting is adjourned at 7:20 p.m.