Town Council Work Session
Tuesday, November 1, 2005
4:30 p.m.
120 Wilkinson Avenue, 2^nd floor
Subject: Economic Development

Present: Mayor Ernie McAlister, Mayor Pro Tem Jack Smith, Council Members Marla Dorrel, Michael Joyce, Jennifer Robinson, Julie Robison and Nels Roseland

Economic Development Commission members present: Chair Wayne Loots, members Gary Ashworth, Spencer Combos, Phil Gorge, William Johnson, Brad McGinnis, Greg Sandreuter, Nellie Shipley and Bernard Steiner.

In addition to the EDC members, Howard Johnson, President of the Chamber of Commerce, was also in attendance.

The work session was called to order at 4:36 p.m.

A copy of The Sanford Holshouser Business Development Group’s project summary is attached to and incorporated in these minutes as Exhibit A.

Mr. Roseland stated that he would like information on sunshine and disclosure. He said that there needs to be a full disclosure policy for when an economic consultant firm approaches the council with a corporate client. Additionally, he would like information provided on the cost benefits, risks, and best practices in cities with economic policies so that the council has a comprehensive pros, cons and risks analysis from an objective group.

Ms. Dorrel stated that in addition to receiving information on a local level about Cary ’s competitiveness in the economic development arena, she would like to receive information on how Cary is perceived on a national scale from outsiders. She would also like to ensure that consultants and staff look beyond the Cary Chamber of Commerce membership to groups that are not represented by the chamber. Mr. Pearson said that once the list is developed staff can circulate it through council for feedback.

Mr. Joyce said that he would like a primary focus to be on existing small businesses, not just on attracting new businesses to Cary . Mr. Pearson said that there is a place in the process to address existing industry and look at small business.

Ernest Pearson of The Sanford Holshouser Business Development Group provided council members with background information on his firm, including the consultants present at the work session who will be working with the Town: Mike Geouge and Gary Shope. He stated that the consultant group has met with staff and discussed the scope of work. (A copy of Sanford Holshouser’s PowerPoint Presentation is attached to and incorporated in these minutes as Exhibit B.)

Ms. Robison asked about the focus groups, how the members will be selected, and the topics they will explore. Mr. Pearson said the group will be selected with the auspices of staff. Although he did not have specific topics, he stated that each group will be asked the same thing in order to gather baseline information on the perception of Cary . There will be a variety of people in each group.

Mr. Gorge asked if corporate consultants who have relocated companies to Cary were going to be a part of the focus groups. Mr. Pearson responded that they may want to speak to them on an individual basis.

Mayor McAlister stated that local municipalities need to be examined, because there may be times when Cary is in competition with its neighbors. Mr. Gorge added that the consultants need to do an analysis of potential cities that compare to Cary and look at their success. Mr. Shope responded that the consultants are looking closely at communities similar to Cary and will look at those in close proximities.

Mr. Pearson said that Cary needs to look at targets for the future and that the generation and market analysis firm of Whitaker Associates will help with identifying industry targets.

Mr. Joyce said he that would like to receive information on the stability of corporate headquarters and how often they have moved. Mr. Pearson said that the consultants will provide council with that information.

Mr. Roseland asked about a good sunshine policy and how to ensure there is complete disclosure. Mr. Pearson said that incentives given are subject to public notice and public hearing. He said he will provide insight on the policies of other cities and counties.

Mrs. Robison asked about North Carolina ’s public hearing requirement for disclosure and when it occurs. Mr. Pearson responded that according to law a public hearing has to occur and 10 days notice of that hearing has to be given. He said that a company has to be fairly comfortable with support of a town or city before removing the confidentiality factor. Mr. Pearson said that there are several ways to achieve the comfort level and Sanford Holshouser can help with that process so that the integrity of a project is preserved and can stand up legally.

Ms. Dorrel asked if the Town’s current policy on incentives will be evaluated. Mr. Pearson responded that the consultants will review the policy and make recommendations. However, they will not share in discussions and decisions on offering levels—this helps to avoid any conflict of interest.

Mayor McAlister said when discussion the organization of the economic development process in Cary between the Town, EDC and the Chamber, the Department of Commerce, Wake County Economic Development, and Research Triangle Regional Partnership also need to be included. He said that council needs to understand the parameters of incentives for the state and county and what the Town’s obligation is to meet those incentives in order to provide leverage. Mr. Pearson said the consultants will provide a summary of state and county incentives and match requirements.

Mayor McAlister said that a high premium should be put on including site consultants in conversations and data gathering. He said that Cary needs to look beyond the biotechnology companies to other targets so that they don’t miss other opportunities. Mr. Shope said that Cary may want to expand their scope and look at life science companies because they are more far reaching than biotechnology companies.

Mrs. Robinson asked if information will be provided on target industries and companies within those industries. Mr. Shope said the information will not be detailed to that level.

Mrs. Robison asked if information will be provided on marketing strategies for targeting industries. Mr. Pearson said he didn’t know, but that partnering opportunities for the Town do exist. Mr. Geouge added that the consultants will perform the research and recommend objectives for achieving goals.

Mr. Roseland said asked if a gap analysis will be done on policies and strategic planning. Mr. Pearson said that the consultants will try to build on what has already been done by the Town’s Economic Development Commission. However, the consultant’s recommendations will be more specifically directed.

Mr. Roseland asked about the geographic analysis and whether an assessment of Cary ’s real estate inventory will be done on the Town’s capacity with the existing land use. Mr. Geouge responded that he will work with staff to look at projections and goals. Mr. Shope said that it is important to plan for the growth. The consultants will assess the Town’s existing inventory and locate pockets where the Town can move forward. Mayor McAlister stated that there needs to be appropriate space and zoning for office parks of the future.

Mrs. Robison asked about the potential of Cary ’s world class sports facilities. Mr. Pearson responded that he doesn’t know what form those facilities will take, but the Department of Commerce’s sports development program works well at a local level.

Mrs. Robinson asked if the downtown will be a prime area for companies to locate. Mr. Geouge said that it is a possibility. Mr. Pearson added that having more people living in the vicinity of downtown are provides more support for businesses.

Mrs. Robison said that a lot of valuable real estate exists in Cary which is not performing and bringing forth the revenues. She asked the consultants to look at strategies and areas for which the Town could provide incentives for stronger production of revenues.

Mrs. Robison requested information on incentives for existing industries and suggested a program that would offer an equivalent match for an existing industry whenever a new company is provided with incentives. Mr. Geouge said they will make recommendations. Mr. Pearson said he does have examples of provisions for existing industries to receive consideration for expansion.

Mrs. Robison asked about the time frame for consultants bringing information back to the full council. Town Manager Bill Coleman responded that timelines will have to be identified as the project moves along. He said that staff will check in with council as particular milestones are reached in the project development.

Mayor McAlister suggested building into the schedule another work session so that the full council will have an opportunity to discuss recommendations. Ms. Dorrel suggested having a work session some time during the January planning period. Mr. replied that the consultants will work with staff to create the time frame.

Ms. Dorrel asked about the efforts used to promote the survey to ensure a wider base of participation. Mr. Pearson said they will have follow up contacts and will work with the Town’s public information office on publicity. Ms. Moran added that there is a targeted list of people who will receive the survey.

Mr. Geouge said leadership and focus groups will have continued dialogue with the consultants prior to completing the survey. Mr. Coleman said that staff has not yet put together the list of people to receive the survey. He said that the Town has a number of different sources to use and staff will put together a list of potential respondents for council to review and provide feedback. Staff will cover a broad spectrum to make sure that the opinion of leaders and business industries are included.

Ms. Dorrel asked if the Town’s website will be evaluated. Mr. Pearson said yes.

Ms. Dorrel asked about targeted business sectors being consistent with Cary ’s economic growth plan. Mr. Geouge said recommendations will be made fro the base data—it will occur halfway through the project—and will include an economic growth plan.

Ms. Dorrel expressed concerned with consultants having preconceived notions about Cary and not being objective. Mr. Pearson stated that the structure of the consultant team is such that two of the team members, one being the project manager, do not know much about Cary .

Mr. Joyce stated that he would like to receive statistical data on other communities which includes information on location of the companies in relation to the metropolitan statistical area. He said he would like to have a regional partnership to provide pointers for future recommendations. He would also like any voids to be identified. He would also like some type of policy where a percentage of incentives given to bigger companies would go toward helping an existing small business.

Mayor McAlister said it would be good to include information on recent events in the area from the convention and visitors bureau and what those events have done for the local economy. He would like information that will help council make future decisions on the expansion of existing facilities.

Ms. Shipley stated that economic development is a two step process, first with companies becoming interested in the region as a whole and then interest in a particular location. She said that it is important to have clarity on the bifurcation of issues, so that the Town knows which issues are truly regional and which are local.

Mr. Gorge said he would like information about retirement communities, redoing the mall, and the impact of homeland security.

Mr. Loots said he would like to receive information on the community foundation partnering with the Town.