CHAIR: Marie J. Carmichael MEMBERS: Reuben A. Shelton Larry D. Neff John E. Mehner Kelley M. Martin Patrick J. Lamping Bradley G. Gregory Matthew L. Dameron EXECUTIVE DIRECTOR: Robert V. Miserez Missouri Development Finance Board MEETING MINUTES MISSOURI DEVELOPMENT FINANCE BOARD Governor Office Building 200 Madison Street, Room 1010 Jefferson City, Missouri NOVEMBER 18, 2014 EX-OFFICIO MEMBERS: Peter D. Kinder Lieutenant Governor Mike Downing Director, Economic Development Richard Fordyce Director, Agriculture Sara Pauley Director, Natural Resources The Missouri Development Finance Board met in regular session on Tuesday, November 18, 2014, beginning at 10:30 a.m. Notice of the meeting was duly posted as required by RSMo Section 610.020 at the MDFB principal office. The following members and officers of the Board were present or absent at the meeting as follows: Marie J. Carmichael Chair Present Reuben A. Shelton Vice Chairman and Member Present Larry D. Neff Secretary and Member Present John E. Mehner Treasurer and Member Present* Kelley M. Martin Member Present Patrick J. Lamping Member Present* Bradley G. Gregory Member Present Matthew L. Dameron Member Present Peter D. Kinder Lieutenant Governor and Member Present* Mike Downing Director, Dept. of Economic Development and Member Present Richard Fordyce Director, Dept. of Agriculture and Member Present Sara Pauley Director, Dept. of Natural Resources and Member Present Robert V. Miserez Executive Director and Assistant Secretary Present *Participated via telephone conference call. Chair Carmichael called the meeting to order and declared a quorum was present. In addition to the above, those in attendance included: Board Staff: Board Counsel: Others Present: Kathleen Barney, Krystal Davis, Kimberly Martin, Ryan Vermette and Valerie Haller David Queen Brian Bunten, Lieutenant Governor s Office; and Alex Stuckey, St. Louis Post-Dispatch 200 Madison Street, Suite 1000 P.O. Box 567 Jefferson City, Missouri 65102 Telephone: (573) 751-8479 Fax: (573) 526-4418 Visit our Web site at www.mdfb.org
I. Secretary s Report Secretary Neff Secretary Neff presented for approval the minutes from the October 21, 2014 meeting. The minutes were included in the Board materials distributed in advance of the meeting. There being no questions, corrections or additions, Secretary Neff made a motion to approve the minutes as presented. Vice Chairman Shelton seconded the motion. The following vote was recorded: Kinder, Downing, Fordyce, Pauley and Carmichael II. Treasurer s Report Treasurer Mehner Treasurer Mehner presented for approval the Treasurer s Report as of and for the three months ended September 30, 2014. The Treasurer s Report was included in the Board materials distributed in advance of the meeting. There being no questions, corrections or additions, Treasurer Mehner made a motion to approve the Treasurer s Report as submitted. Secretary Neff seconded the motion. The following vote was recorded: Kinder, Downing, Fordyce, Pauley and Carmichael III. Department of Economic Development Report Director Downing Director Downing distributed a handout packet that contained information on the July 1 to November 15th business announcements, the Missouri Business Portal, Missouri Export Portal and the Department s Division of Energy. Director Downing reported Missouri s unemployment rate dropped by four-tenths of a percent to 5.9% for October, the lowest since June 2008. Director Downing reported on the business announcements and commented that a project announcement would be made in Kansas City for a company adding approximately 100 jobs. Director Downing commented the continued spinoff of GM and Ford is auto 2
suppliers and the Department has approved approximately 20-22 auto supplier projects in the last 12-18 months totaling more than 1,500 jobs. Director Downing noted he will be attending the Detroit Auto Show in January 2015. Director Downing discussed the Missouri Business Portal which assists companies seeking information regarding state services, licenses, permits, incentives, resources, etc. Director Downing also discussed the Missouri Export Portal and commented that companies do not understand the capacity they may have or the process to export internationally. The Portal, as well as staff, can assist with export goods, financing for attending trade shows, the best places to go, and what kind of products and services are applicable to certain countries and products/services. Director Downing discussed the Department s Division of Energy and its Comprehensive State Energy Plan. Seven public meetings were held statewide and working groups were formed to discuss more in depth the details of the components of the Plan. Director Downing noted the Plan is estimated to be completed in approximately seven to eight months. IV. Department of Agriculture Report Director Fordyce Director Fordyce discussed the upcoming Governor s Conference on Agriculture which will be held December 18-20, 2014 at Tan-Tar-A Resort in Osage Beach. Director Fordyce reported on crops and noted that harvesting is winding down. Director Fordyce reported on legislation for hemp growing and the hemp is to be produced for cannabidiol oil for the treatment of certain types of epilepsy. Vice Chairman Shelton asked if there were any updates on the swine virus. Director Fordyce responded there are some vaccines for the PED virus, but they anticipate the virus will flare up again although not as severe. Secretary Neff asked for the projections on the cattle herd numbers. Director Fordyce responded that Missouri is #2 in the country for cow/calf production and birth approximately 1.8 million calves a year. Currently prices are high and the herd expansion probably is not happening at the rate needed. V. Department of Natural Resources Director Pauley Director Pauley discussed the recent Governor s Conference on Natural Resources in which the Department celebrated its 40th Anniversary in Springfield, Mo. Director Pauley noted that during the conference Governor Nixon announced that 2015 will be the year of water, which among other things will be in terms of waterways, water quality and infrastructure. 3
VI. Lieutenant Governor s Report Lt. Governor Kinder Lt. Governor Kinder deferred his report. VII. Old Business A. Tax Credit for Contribution Program CY 2014 Robert V. Miserez April 30 Funding Cycle Application Recommendations Mr. Miserez presented the ranking and recommendation for the four tax credit for contribution applications received from the April 30, 2014 funding cycle. Mr. Miserez reported he had discussions with Director Downing and the consideration of the applications was postponed and deferred in April due to the state budget and uncertainty of state revenues and receipts. Mr. Miserez discussed the applications and reported the ranking and scoring had been completed. Mr. Miserez noted the eligible projects scored very close to one another, but the Kansas City World War I Museum scored higher because of its overall tourism impact to Missouri and time sensitive urgency of the project relating to centennial celebrations of WW I. Staff recommended approval of $1,800,000 in tax credits subject to receipt of $3,600,000 in contributions for the World War I Museum. Mr. Miserez referenced and discussed the synopsis of applications that were received for the September 30, 2014 funding cycle and noted that no recommendation was being made for that funding cycle at this time. Secretary Neff made a motion to approve $1.8 million in tax credits subject to receipt of $3.6 million in contributions for the Kansas City World War I Museum. Member Martin seconded the motion. Director Downing commented the World War I Museum project has some urgency because of the upcoming 100 year anniversary of World War I and he fully supports the project because of this also. Vice Chairman Shelton questioned the timeline for future tax credit project recommendations. Director Downing responded the state budget is monitored on a monthly basis and the Governor had released a few million dollars for certain programs; however, it is still uncertain as there are several budget demands. Director Downing commented that should the revenue numbers increase, the Board should be able to authorize future credits appropriately. Discussion ensued regarding the state budget and the ability to award future tax credits, and it was requested that staff review and analyze the second funding cycle applications for possible recommendation at the December Board meeting. With a motion on the floor and seconded, the following roll call vote was recorded: 4
Kinder, Downing, Fordyce, Pauley and Carmichael VIII. New Business A. Ferguson Commission Grant Request Robert V. Miserez Mr. Miserez presented the request from the Department of Economic Development for a $100,000 grant from the Board for the purposes of supporting operating costs, research, and other related expenses of the newly formed Ferguson Commission. Mr. Miserez noted the Commission would be seeking an equal or greater amount of funds from private entities, foundations and companies to support funding of the Commission. Mr. Miserez referenced Director Downing s letter that was included in materials distributed in advance of the meeting which detailed the request and the charge of the Commission. Director Downing commented there have been discussions with several other foundations that have expressed interest in supporting the Commission. Mr. Miserez reported the Hawthorn Foundation, a 501(c)(6) entity, would no longer be the fund administrator and the administration was transferred to the United Way of Greater St. Louis since they are a 501(c)(3) not-for-profit. Director Downing commented other foundations had requested that the fund administrator be a 501(c)(3). It was suggested that Board approval include language that the fund designee be an entity agreed upon between the Department of Economic Development and the Board Chair. Secretary Neff questioned if the issue was just now being discussed in Missouri. Director Downing responded that related studies have been completed by various organizations, but not to the specific issues as a result of the unrest in Ferguson. Vice Chairman Shelton commented that racial disparity and profiling studies have been completed, but this effort would be a broad, all-encompassing effort and the State of Missouri has never had this kind of oversight. Lt. Governor Kinder commented that with great respect to everything that had been said and by those that had said it, he wished to register his dissent and disagreement for his no vote because several similar commissions and studies had been done since the 1960s. Lt. Governor Kinder continued and commented he has great respect for those serving on the Commission, but he has yet to find an 5
individual who believes the empanelling of a commission to issue a report that would be an important part of the solution to Ferguson. Chair Carmichael commented she considered the commission timely and that there is some urgency. Secretary Neff made a motion to approve the $100,000 grant for the purposes of supporting operating costs, research and other related expenses of the Ferguson Commission with the mutual consent between the Department of Economic and the Board Chair of the fund designee. Vice Chairman Shelton seconded the motion. The following roll call vote was recorded: Downing, Fordyce, Pauley and Carmichael Kinder B. Division of Workforce Development Robert V. Miserez $2 Million Grant Request from MDFB Mr. Miserez presented the request from the Department of Economic Development for a $2 million grant from the Board to the Division of Workforce Development (DWD) to provide partial funding to the Missouri Works Customized Training Program (CTP). The Board previously granted a total of $10 million in past years for the CTP. Mr. Miserez reported the Department did have a $14 million appropriation for the CTP, but $12 million of the appropriation was withheld. Member Martin questioned if the Board could do more and how the grant would impact the Board s budget and balance sheet. Mr. Miserez responded there are many variables involved, but currently there are sufficient balances to fund the $2 million request. Secretary Neff made a motion to approve the $2 million grant request to the DWD for their Customized Training Program. Vice Chairman Shelton seconded the motion. The following roll call vote was recorded: Kinder, Downing, Fordyce, Pauley and Carmichael 6
C. Vernon County PWSD#1 Krystal Davis MIDOC Loan Application Ms. Davis presented the application from Vernon County Public Water Supply District #1 for a MIDOC loan not to exceed $100,000 for a water replacement project. Total project costs are estimated at $200,000 and the water district currently serves 295 customers. Ms. Davis reported the Department of Natural Resources approved the District s plans and specifications in March 2014. Staff recommended approval of a MIDOC Loan not to exceed $100,000 at 3% for up to 20 years for Vernon County Public Water Supply District #1. Vice Chairman Shelton made a motion to approve the application from Vernon County Public Water Supply District #1 for a MIDOC Loan not to exceed $100,000 at 3% for up to 20 years. Member Martin seconded the motion. The following roll call vote was recorded: Kinder, Downing, Fordyce, Pauley and Carmichael D. Election of MDFB Officers Chair Carmichael Chair Carmichael commented that the current officers indicated a willingness to continue to serve in their current capacity Reuben Shelton, Vice Chairman; John Mehner, Treasurer; and Larry Neff, Secretary. Chair Carmichael asked for nominations from the floor. Member Martin made a motion to elect the current slate of officers by acclamation. Member Gregory seconded the motion. The following vote was recorded: Kinder, Downing, Fordyce, Pauley and Carmichael 7
E. Tax Credit for Contribution Project Review Kimberly Martin This item was deferred and a handout distributed for future review. IX. Executive Director s Report Robert V. Miserez Mr. Miserez reported the Missouri Auditor s Office scheduled an exit interview with staff to review their audit and report on the Tax Credit for Contribution Program. Mr. Miserez reported that Ryan Vermette had submitted his resignation and has taken a position with another organization. Chair Carmichael and others congratulated Ryan on his new position and wished him great success. X. Adjournment There being no further business before the Board, Secretary Neff made a motion to adjourn the meeting. Vice Chairman Shelton seconded the motion. By unanimous consent, Chair Carmichael declared the motion passed and the meeting adjourned. [Secretary Neff s Signature] 8