Friday, August 12, 2011 Memos

8/6/2019 Friday, August 12, 2011 Memos

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Memorandum

Date: August 12 , 2011To : Honorable Mayor and Members of the City Council

Subject: Impact of Weather on Dallas Water Supply

CITY OF DALLAS

News stories over the past several weeks have focused on the widespread droughtthroughout the state of Texas and the tremendous burden on both water and electric utilitiesdue to the extreme hot and dry weather conditions. The National Weather Service predictsthat these conditions will likely continue, with Texas remaining in an exceptional droughtthrough the end of October. The La Nina weather phenomenon blamed for the lack of rainmay also return in the Fall, which would likely extend the drought conditions into 2012. Adepiction of the U.S. drought map is shown below.Council will be provided with a more detailed briefing on the drought situation on Wednesday,August 17. In addition, a press release has been prepared and will go out today.

Drought ongoing, someimprovement Drought likely k improve,impacts easeDrought developmentlcely

Depicla Ie.acaenti basdonabjedMety C1veCprvbaeeCDeCby iIrt-C )oqan tItoi arKi dnam raceots SnOrt-term eveito such as mdIwIlkui slomz catwi be axuraty 1ecaM rnooe Cial a 05w Cays In auaice.Use caulien ectoIcnssum as s ltra cas becteC by sum everrOriqcte udarasa ate apprordmd itoni 05.Drou Mrmflix1 t D4aitsusayFweeePywrt i4)5,s 05e liestlis. Ooelt ManlOr NOTE the green Inpoteriieniasas iiCy at Ie a a t-ao,y lrpreisrneM hi theDrouitMonitor m*iy levels,but Co not nececasy Imply C1cult ethinMorn.

U.S. Seasonal Drought OutlookDrought Tendency During the Valid PeriodValidAugust4, 2011- October 31, 20flR&easedAugust42011

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KEY:Drought to persist or No Drought _ntensity PostedlPredioted

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Dallas, The City That Works: Diverse, Vibrant, and Progressive


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Memorandum

CITY OF DALLASDATE August 12, 2011TO The Honorable Mayo r and Members of the City Council

SUBJECT Priority Fulfillment Service, Inc.August 24 , 2011 Council AgendaBACKGROUNDCity staff has been in negotiations with Priority Fulfillment Service, Inc., a wh olly -ownedsubsidiary of PFSweb, Inc., to locate its pr ime customer contact center in Dallas. PriorityFulfillment Service, Inc. will lease approximately 75,000 square feet of the 1,729,294 squarefoot Class A office building at 1201 Elm Street, Dallas Texas for at least 10 years contingentupon City Council approval of this incentive agreement. In addi tion to Da llas, PriorityFulfillment Service, Inc. considered Piano, Allen and Richardson as poten tial locations for thisoperation.Prior ity Fulfillment Service, Inc. seeks City Counc il approval of an economic developmentgrant in an amount no t to exceed $300,000 in consideration of the relocation of its prim ecustomer contact center to the Central Business District in Da llas . In addition, the City Councilis asked to nominate Priority Fulfillment Service, Inc. as a State of Texas Enterprise ZoneProject. The Enterprise Zone designation allow s Pr iority Fulfillment Service, Inc. to receivestate sales and use tax refunds on qualifie d expenditures for committing to hire at least 35percent of its workforce from economically disadvantaged or enterprise zone residencyrequirements.Priority Fulfillment Service, Inc. will make a minimum private investment of $2,000,000 intenant improvements as well as create and maintain 600 jobs in order to be eligible to receivethe economic development grant. The economic development grant will be payable in twoequal annual installments upon the substantial completion of a minimum of $2,000,000 intenant improvements, receipt of their Certificate of Occupancy and ver ifica tion of the creationof 600 jobs to the site by April 15 , 2014. Priority Fulfillment Service, Inc. will for feit theeconomic development grant if Priority Fulfillment Service, Inc. fails to reach 600 jobs on siteby April 15, 2014.PFSweb develops and deploys comprehensive end-to-end eCommerce solutions for Fortune1000 , Global 2000 and brand name companies, inc lud ing interactive marketing services,glob al fulfillment and log istics and high-touch customer care. The company serves a multi tudeof industries and company types, inclu ding such clients as P&G, LEGO, Carters, Lucky BrandJeans, Juicy Couture, Kensie, kate spade new york, AAFES, Riverbed, InfoPrint SolutionsCompany, Hawker Beechcraft Co rp., Roots Canada Ltd. and Xero x.Th is pr ime customer contact center will provide high-touch customer care services 24 hours aday, 7 days a week , 363 days a year via phone and online.


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Priority Fulfillment Service, Inc.August12, 2011Page 3 of 4g.A more comprehensive strategy is in the works to attract a mix of tenants to theseolder bui ldings: back office, small business and data centers.

6. The City has averaged more than 15 do llars invested in recent years for every dol lar ofpublic participation even with the more difficult real estate market. Over tim e this leveragegenerates excess revenue for the City and makes it possible to deliver some projects thatare more marginal fin anc ially.7. Recent deals like MoneyGram and AT&T more than offset the public participatio n in thisproject.8. Consideration of thi s deal demonstrates the Citys commitment to supporting a diverseworkforce with opportunities for all levels of talent.

PROJECT DETAILSProjectSite: 1201 Elm StreetJobs: 600New Real Property Improvements: $2,000,000Annual Payroll: $14,500,000Average Salary: $22,952CITY INCENTIVESEconomic Development Grant: $300,000PROPOSED ESTIMATED SCHEDULE OF THE PROJECTBegin Construction September 2011Complete Construction March 2012FISCAL INFORMATION$300,000 Publ ic Private Partnership Program FundsOWNERPriority Fulfillment Service, Inc.Lawrence Lubrano, Vice President, CCC & ImplementationsCOUNC IL DISTRICT14


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Priority Fulfillment Service, Inc.August 12 , 2011Page 4 of 4STAFFJ. Hammond Perot, Assistant Dire ctorKim L. Moore, Senior Coordinator, Marke tingRECOMMENDATIONStaff recommends approval of the subject item .Should you have any further questions or concerns, please contact me at (21 4) 670-3296.

Ryan S. evansAssistant City ManagerC: The Honorable Mayor and Members of the City CouncilMary K. Suhm, City ManagerRosa Rios, Acting City SecretaryTom Perkins, City AttorneyCraig Kin ton, City Auditor

Judge C. Victor Lander , Administrative Judge Munic ipal CourtA.C. Gonzalez, First Assistant City ManagerJill A. Jordan, P.E ., Assistant City ManagerForest Turner, Assistant City ManagerJoey Zapata, Inter im Assistant City ManagerJeanne Chipp erfield, Chief Financial OfficerKarl Zav itkovsky , Director, Office of Economic DevelopmentJ. Hammond Perot, Assistant Director, Office of Economic DevelopmentHelena Stevens-Thompson, Assistant to the City Manager

Dallas Together, we do it better


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Renaissance Tower1201 Elm StreetDallas, TX 75201

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A. Project Summary

Exhibit BProposed Project Information Worksheet

Economic Development Committee

City Council District 14Project/Company Name Priority Fulfillment Services, Inc.Project Location 1201 Elm StreetProject Type Prime Customer Contact CenterFacilities (Square Feet) 75,000Construction Schedule Begin 1-Sep-liComplete 31-Mar-12

I Private Improvement Investment Real Property $2,500,000Business Property $1,500,000IJobs Created 630Retained 0jAverageWage Rate Salary $22,952Hourly N/A

ICity Incentive Summary Tax Abatement N/AInfrastructure N/AOther $300,000 Grant

B. Economic Impact Estimates (Dallas City Economy Only, $ Million)1 0-Year 20-YearEconomic EconomicJobs Output Jobs OutputDirect Impact 630 233,322,875 630 568,414,145Indirect and Induced lmpact* 378 186,658,300 378 454,731,316Total Impact 1008 419,981,175 1008 1,023,145,461

C. City of Dallas General Fund Fiscal Impact ($ Million)(From direct, indirect and induced economic impacts)

1 0-Year 20-YearTotal City GF Revenue Generated 2,982,929 6,766,308Total City GE Service Costs 3,453,858 7,661,775Net Impact Before Incentives -470,929 -895,467City Incentives 300,000 300,000Net City Fiscal Impact -770,929 -1,195,467* Indirect impacts represent supplier effects, induced impacts represent spin-off household effects.D. Other Taxing Jurisdiction 10-yr stimated Tax Revenue

Property Taxes Sales TaxesDISD $ 495,124 N/ADallas County $ 101,240 N/ADCCCD $ 39,692 N/AParkland Hospital $ 108,400 N/ADART $ - N/A


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Memorandum

CITY OF DALLASDATE August 12, 2011TO The Honorable Mayo r and Members of the City CouncilSUBJECT Borden Dairy Company (Formerly LALA-USA)August 24, 2011 Council Agenda

BACKGROUNDFo r the past several months, city staff has negotiated with Borden Dairy Company, fo rmer lyLALA-USA regarding the possible relocation of its shared service and support functions accounts payable, accounts receivable, payroll and tax processing for 18 plan t locationsaround the U.S. Borden Dairy is a Dallas based international company with dairy facilitiesacross the coun try. The U.S. headquarters, located at 8750 North Central Expressway,employees approximately 100 employees.The company also considered leasing space in Farmers Branch and Irving, bo th of whichpresented cost advantages to the Dallas site due to lower utility costs in newer bui lding s. Theproposed grant is designed to offset the higher annual expenses at the Dalla s sit e, rel ocationcosts and other project costs.The proposed relocation will result in a 5-year lease of approximately 25,000 square feet ofoffice space at 9400 North Central Expressway and a minimum 100 new employees, althoughplans call for up to 180, with an estimated additiona l payroll of $9,400,000. The company alsohas a dairy facility of approximately 60,000 sq . ft. located at 5327 S Lamar in Dalla s.The company will be required to maintain the 200 jobs in Dallas at the two office s through April2013 or the grant will be subject to 50% recapture.Th is project has an estimated 10-year net fisc al impact of $439,699.PROJECT DETAILSProject Site: 9400 North Central Expressway, Dallas , TXFacilities: 25,000 sq. ft. office spaceEstimated Investment:Approximately $700,000 in business personal propertyApproximately $390,000 real property improvementsPROPOSED ESTIMATED SCHEDU LE OF THE PROJECTBegin Construction August 2011Substantial Completion October 2011


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Borden Dairy CompanyAugust 12, 2011Page 2 of 2OWNERDal las NCX Properties, LLCCOUNCIL DISTRICT13STAFFJ. Hammond Perot, Assistant Dire ctorChristopher OBrien, Sr. CoordinatorMAPAttachedRECOMMENDATIONStaff recommends approval of the a one-time economic development grant in an amount notto exceed $100,000 paid on or before December, 2011, once the company has executed alease at 9400 North Central Expressway in Dallas and created/retained a minimum of 250jobs.Should you have any questions or concerns, please contact me (214) 670-3296.

-Ryan S. EvansAssistant City ManagerC: The Honorable Mayor and Members of the City CouncilMary K. Suhm, City ManagerRosa Rios, Acting City SecretaryTom Perkins, City AttorneyCraig Kinton, City Audito rJudge C. Victor Lander, Administrative Judge Municipa l CourtA.C . Gonzalez, First Assistant City ManagerJill A. Jordan, P.E ., Assistant City ManagerForest Turner, Assistant City ManagerJoey Zapata, Interim Assistant City ManagerJeanne Chipperfield, Chief Financial OfficerKarl Zavi tkovsky, D irecto r, Office of Economic DevelopmentJ. Hammond Perot, Assistant Director, Office of Economic DevelopmentHelena Stevens-Thompson, Assistant to the City Manager

Da llas Together, we do it better


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Memorandum

CITY OF DALLASDATE August 12, 2011TO The Honorable Mayor and Members of the City Council:SUBJECT 16h Ave. Holdings, LLC (GAF)August 24, 2011 Council Agenda

BACKGROUNDAve. Holdings, LLC seeks City Council approval of a $230,000 bridge loan tomake necessary improvements at 2520 Weir Street, Dallas, Texas 75212 in order tolease the site to GAF Materials Corporation (GAF) . The proposed facility will haveoutside storage of trucks, roofing materials and a general office function. The projectwill result in approximately 25 new jobs with an estimated annual pay roll of $750,000.In addition to the proposed improvements associated with this project, the owner hasinvested over $500,000 in other improvements for other sites in the immediate area.

GAF, North Americas largest manufacturer of commercial and residential roofing withnearly $3 Billion in sales, has a production facility at 2600 Singleton that manufacturesroofing shingles. The company is in need of additional storage of finished product.In order to secure a lease with GAF, 16h Ave . Holdings, LLC must enhance thesecurity of the site by improv ing the lighting , fencing and security system connectivity.Also, they must build a concrete entrance to the site and add 8 inches of rock to allother areas that will be used for storage.Citys Loan Terms1) 0% percent interest for 36 months;2) 16h Ave . Holdings LLC will make quarterly payments;3) No prepayment penalties or changes in the interest rate for pre-payments;4) Guarantees will be provided by the CEO, Corporation commitments to repay5) In the event that 16h Ave. Holdings LLC is late on a payment, they will have a cureperiod of 5 days;6) In the event 16h Ave. Holdings LLC does not make its quarterly payment within thecure period, they will be declared in default and the interest rate would increase to13 percent;7) In the event there are not a minimum 10 full time jobs onsite within 6 months, theywill be declared in default and the interest rate wou ld increase to 13 percent;8) If still unable to cure, the loan is declared due and payable and 16h Ave. HoldingsLLC can be sued for the guarantees of the loan;


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l6 Ave. Holdings, LLC (GAF)August 12, 2011Page 2 of 3

PROJECT DET AILSProject Site: 2520 Wier Street, Dallas, Texas 75212Facilities: 5.75 Acres of land with a modular officeEstimated Investment: approximately $250,000 millionPROPOSED ESTIM AT ED SCHEDULE OF TH E PROJECTBeg in Construction August 2011Substantial Completion October 2011OWNER16h Ave. Holdings, LLCLawrence SweeneyCOUNCIL DIST RICT3STAFFJ. Hammond Perot, Assistant DirectorChristopher OBrien, Sr. CoordinatorMAPAttached


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16h Ave. Holdings, LLC (GAF)August 12, 2011Page 3 of 3RECOMMENDATIONStaff recommends approval of the subject item.Should you have any questions or concerns, please contact me at 214-670-3296.

Ryan S. EvansAssistant City ManagerC: The Honorable Mayor and Members of the City CouncilMary K. Suhm, City ManagerRosa Rios, Acting City SecretaryTom Perkins, City Attorney

Craig Kinton, City AuditorJudge C. Victor Lander, Administrative Judge Municipal CourtA.C. Gonzalez, First Assistant City ManagerJ il l A. Jordan, P.E., Assistant City ManagerForest Turner, Assistant City ManagerJoey Zapata, Interim Assistant City ManagerJeanne Chipperfield, Chief Financial OfficerKarl Zavitkovsky, Director, Office of Economic DevelopmentHammond Perot, Assistant Director, Office of Economic DevelopmentHelena Stevens-Thompson, Assistant to the City Manager

Dallas Together, we do it better


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Memorandum

CITY OF DALLASDATE August 12, 2011TO The Honorable Mayor and Members of the City Council

SUBJECT The first of four twelve-month renewal options to the contract with the SouthernDallas Development Corporation (SDDC ) to administer the Ci ty of Dallas CDBGRevolving Loan Program August 24, 2011On December 8, 20 10, the City Counc il authorized the execution of a contract with an ini tialone-year term and four one-year renewal options with SDDC by Resolution No. 10-3056 .On June 22, 2011, the City Coun cil authorized the adoption of the FY 2011-12Consolidated Plan B ud get, which in cluded program income estimated at $600,000 to beretained by SDDC and any unexpended balances from pri or years, to continue themanagement and operation of the Business Revo lving Loan Program by Counci l ResolutionNo. 11-1679.On August 24, 2011, the City Council will consider (1) authorizing the first of fou r tw elve-month renewal options to the contract with the Southern D allas Development Corporation toadminister the City of Dallas CDBG Revo lving Loan Program, for the purpose of se rvicingand m ak ing loans to for profit businesses to create and retain jobs for low-to-moderateincome persons; and (2) any unexpended balances of program income and allocationsfrom prior contract years be rolled over to continue the CDBG Revolvin g Loan Program.BACKGROUNDSince 1989, the City of Dallas has contracted with SDDC to use C om m unity DevelopmentBlock Grant (CDBG ) dollars to administer and implement a business loan programdesigned to help rev itali ze and enhance community and economic development in the Cityof Dalla s. SDDC is currently in the tw enty-first year of contracting with the City of D allas toprovid e these loa n services.SDDC has approved 176 loans through the Revolving Loan Program from in ception to date.SDDC has a proven tract record of administering loan programs and other services. SDDChas provided approximately $18,970,065 in CDBG loans to foster economic development;leveraged an estimated $37,064,408 in private investment and created/retained 1,885 jobs.The CDBG Revo lving Loan Program provides loans of up to $300,000 in financing foreligible businesses in the City of D allas and requires that 1 new job per $35,000 loaned becreated or retained for a low to moderate income person. The Revolving Business LoanProgram is managed under HUD and City approved operating guidelines. Rates and termsare established by the SDDC Board of Di rectors. The Board includes three Appointmentsby the City Counc il.


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Southern Dallas Development Corporation (SDDC)August 12, 2011See attached Scope of Services, Loan Performance and Cash AvailabHity detaNs trough6/30/11.OWNERSouthern Dallas Development CorporationLoren Mon tgomery, Board ChairCOUNCIL DISTRICTAllFISCAL INFORMATIONNo cost consideration to the CitySTAFFLe e McKin ney, Assistant Director, Office of Economic DevelopmentErma Saracho, Sr. Coordinator Small Business InitiativesRECOMMENDATIONStaff recommends the City Council authorize the first of four twelve-month renewal optionsto the contract with the Southern Da llas Development Corporation to administer the City ofDalla s CDBG Revolving Loan Program.Should you have any questions, please contact me at (214) 670-3296.

Ry an S. EvansAssistant City ManagerC: The Honorable Mayor and Members of the City CouncilMary K. Suhm, City ManagerRosa Rios, Acting City SecretaryTom Perkins, City AttorneyCra ig Kinton, City Aud ito rJudge C. Victor La nder, Adm inistrative Judge Municip al CourtA.C. Gonzalez, First Assistant City ManagerJill A. Jordan, P.E., Assistant City ManagerForest Turner, Assistant City ManagerJoey Zapata, Inte rim Assistant City ManagerJeanne Chipperfield, Chief Financial OfficerKarl Zavitkov sky Director, Office of Economic DevelopmentJ. Hammond Perot, Assistant Director, Office of Economic DevelopmentLee McKinney , Assistant Director, Office of Economic DevelopmentHelena Stevens-Thompson, Assistant to the City Manager

Dallas-Together, we do it better


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!4niversity of/Tas at Dallas

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ffE/ LegendCity of Dallas DART Blue Line to Rowlett (2011)o Rail Station a DART Orange Line to DFW Airport (2012-14) Future Station DART Blue Line to UNT-Dallas (2019)

DART Red Line Freeway or TollwayDART Blue Line HighwayDART Green Line ArterialDART Orange Line Local RoadTrinity Railway Express Proposed Freeway or TollwayI5arce: Ajrorte & Proaoaed Roadwava - NCTCOG. 2009: All Other Data - City ot Dallae. 2010

Colleges & UniversitiesLakes & RiversParksEscarpmentFlood PlainAirportBusiness Parks


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Scope of ServicesCDBG Revolving Loan Fund ProgramThe CDBG Revolving Loan Fund Program is used to make loans to businesseslocated in the Dallas city limits. Loans made directly or in partnership withconventional banks and non-traditional lenders to qualified business applicantswill provide fixed-interest rate, term loans for permanent working capital,machinery, equipment, commercial real estate acquisition and development thatwill result in job creation through expansion, relocation or growth or, job retentionthat would actually be lost without CDBG assistance.CDBG RLF Program Goals

Make loans to businesses that will result in job creation or job retention forlow to moderate income persons. Perpetuate a positive and proactive business climate which encouragesthe retention and expansion of existing businesses and help to attractdesirable new businesses. Manage the CDBG RLF Program in behalf of the City of Dallas- Screen loan applicants for eligibility

- Underwrite and process eligible loan requests- Process accounts receivables and manage delinquency/collectionaccounts- Submit monthly/quarterly required reporting data- Make on-site client visits to monitor business operation and jobcreation or retention goals

Every $35,000 loaned must result in one full-time job created or retained.Of the total jobs created per loan, 51% must be made available to low tomoderate income personsEligible Borrowers

The Business must be a for-profit business entity located with the Dallascity limits where CDBG funds will be used to create and/or retain jobs forlow to moderate income persons. Loans provided under CDBG Revolving Loan Program are generally tobusinesses where conventional financing isnt available due to risk factorsbeyond conventional financing risk tolerance.


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Loan Performance 1OI1I1O-0613011 1Loans Closed 1Total Dollar Amount of Loans Closed: $267,661Total Dollars Leveraged on Loans Closed: $780,344Total Jobs created/retained from Closed Loans: 37Total receivables collected (Program Income) $480,388Total portfolio as of 6/30/11 $3,057,710Total Principal Past Due $202,574Loan Delinquency Rate 6.63%Loans Charged to Loss $0Loan Loss 0Loan Loss Recovery $7,350Pending Loans in Pipeline 2Loan Amount in Pipeline $75,000

Loan Applications have been suspended to a llow for build up of collection ofProgram Income (Accounts Receivable).


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SDDCCash AvailabilityAs of 6/30/11

As of 9/30/10Come rica #5733 $98,976.05Comerica #5741 $5,092.82Bank of America #3164 $15,158.85 $119,227.720/S check as of 9/30/10 -$13.500/S depos on #5733 as of 9/30/10 $14,721.36TOTAL AS OF 9/30/10 $133,935.58

Expense:2010 Expenses $17,494.61

$12,827.00Payroll Expense (7/12/10 - 9/21/10) $53,186.30Total Expenses for 2010 ($83,507.91)AVAIL PROGRAM INCOME AS OF 10/1/10 $50,427.67

10/1/10 -6 /30/11Recoveries as of 6/30/11 $480,388.24Allocations (11/10/11) $7,350.00mt. earned through 6/20/11 $24,614.49Total Income THROUGH 6/30/11 $5.59

$512,358.32Loans funded through 6/30/11 $267,661.00Payroll paid (10/1/10 - -5/3/11) $144,945.57Other reductions through 6/30/11 $37,502.23est. payroll due 5/4/11 - 6/30/11 $35,984.20Total disbusements through 6/30/11 ($486,093.00)

TOTAL CASH AVAILABLE AS OF 6/30/11 $76,692.99


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Memorandum

DATE August 12, 2011TO The Honorable Mayor and Members of the City Council

Budget Workshop #5 Response to Questions

CITY OF DALLAS

During your August 8h Budget Workshop, questions were asked regarding the cost toeliminate Mandatory City Leave days for civilian employees. Eliminating the unpaid leavedays will increase service to citizens since employees will be on duty rather than off duty.As part of the FY 2010-11 budget, civilian employees pay was reduced in order to helpbalance the budget:

Civilian employees were required to take a total of 8 Mandatory City Leave dayswhich resulted in a 3.08% pay reduction. Civilian employees had tiered pay reductions up to an additional 3% based upontheir base pay.

The proposed FY 2011-12 budget partially restores the reductions that were put in place inFY 2010-11 by eliminating 3 of the 8 Mandatory City Leave days. While this proposalrestores 1.17% of civilian employee pay, it leaves civilian employees pay between 1.91%and 4.91% less than in FY 2009-10.The cost to restore each Mandatory City Leave day is $727,000 for the General Fund and$429,000 for the enterprise and internal services funds. The cost to restore the 5remaining Mandatory City Leave days is $3.6m for the General Fund and $2.lm for theenterprise and internal service funds.

contact me if you have any questions or require additional information.

C: Thomas P. Perkins, Jr. City AttorneyRosa Rios, Interim City SecretaryCraig Kinton, City AuditorC. Victor Lander, JudiciaryA.C. Gonzales, First Assistant City ManagerRyan S. Evans, Assistant City ManagerJill A. Jordan, P.E., Assistant City ManagerForest Turner, Assistant City ManagerJoey Zapata, Interim Assistant City 11anagerJeanne Chipperfield, Chief Financial OfficerJack Ireland, Director, Office of Financial ServicesHelena Stevens-Thompson, Assistant to the City Manager

City ager

Friday, August 12, 2011 Memos

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