Tax-Exempt Review Committee - January 22, 2019
The November meeting of the Tax Exempt Review Committee of the City of Fargo, North Dakota, was held in the City Commission Room at City Hall at 1:00 p.m., Tuesday, January 22, 2019.
The committee members present or absent are:
Present: Robert Wilson, Jim Gilmour, Jim Buus, Kent Costin, Chuck Hoge, Dave Piepkorn, Bruce Grubb, Mark Lemer, Erik Johnson, Jackie Gapp
Absent: Joseph Raso, Mayor Tim Mahoney, Ben Hushka, Jessica Ebeling
Others Present: Kati Wilcox, Randy Thorson
Commissioner Piepkorn called the meeting to order at 1:00 p.m.
Kent Costin made a motion to approve the minutes from the October meeting held on November 27, 2018. Jim Buus seconded the motion, which carried.
5 Year New Industry Exemption Application by CI Sport, Inc.
Jim Gilmour introduced the application submitted by CI Sport, Inc. for a five-year New Industry exemption. CI Sport, which sells screen-printed and embroidered apparel and is currently located in downtown Fargo. The organization would like to acquire the Gander Mountain building, which would allow for more employment opportunities in the area, as well as higher-skilled job opportunities due an increase in space.
Randy Thorson, President of CI Sport, estimates adding $1.5 million worth of new equipment to the facility. He explained this will allow “those $10 per hour jobs” to become automated processes and current employees to move to higher skilled, higher paying jobs. The larger space and new location will provide the ability for a second shift, meaning an increase in job opportunities in Fargo. CI Sport started with three employees completing mainly local, promotional projects. The company now employs over 100 people, sells to 2200 stores around the world, including Amazon.
Commissioner Dave Piepkorn clarified that the larger facility is what will allow for the increase in equipment then asked Mr. Thorson to explain some of the challenges of the downtown location. There is one loading dock behind the building, which causes backups of semis and UPS trucks in an alley, which nearby condominium owners also utilize. The new facility will have two loading docks in spaces that are more convenient for both shipping and receiving.
Commissioner Piepkorn inquired about incentives offered in other cities. Mr. Thorson stated Moorhead did make offers and he had checked West Fargo as well. Commissioner Piepkorn explained that CI Sport is one of the longest standing businesses in downtown Fargo. Randy Thorson is a long-time Fargo resident and serves on other committees in the city. There are benefits to maintaining a relationship with organizations with such strong ties to Fargo.
A partner company, Global Acquisition, purchased the property and will lease the building to CI Sport. Chuck Hoge asked if this lease is longer than the five-year exemption, and Mr. Thorson explained that it is.
Robert Wilson inquired about any lessons learned regarding businesses such as CI Sport purchasing and repurposing big-box stores. Mr. Thorson explained selling this large of a building could be difficult to sell from a real estate perspective but could also hold great opportunity for businesses like his.
At Mark Lemer’s request, Jim Gilmour clarified the request is for exemption on the entire building for only five years. CI Sport will also continue to own and pay taxes on the space downtown.
After no further questions were presented, Jim Buus made a motion to approve the application, which Bruce Grubb seconded. The motioned carried.
5 Year New Industry Exemption Application by Prairie Products LLC
The application was withdrawn, with a possibility of returning in February. Commissioner Dave Piepkorn clarified there was nothing further to discuss with this agenda item.
Final Discussion on Revisions to Tax Exempt Review Committee Policy & Guidelines
Jim Gilmour included the latest updates of the Tax Exempt Review Policy for one last review before presenting the changes to the City Commission. He included one addition pertaining to the periodic reporting, which will not be required after all stated goals have been met or necessitate applicants to pay back a prorated incentive amount if they are not. There will also be opportunity to extend goals up to two years if needed and with approval at a public meeting.
After discussion among committee members, it was decided to alter the order of two paragraphs under the ‘Additional Policy and Procedures’ section as it allows for more permissive language in the policy. Commissioner Piepkorn asked that the final copy be posted to the website prior to the next commission meeting.
Robert Wilson stated the Cass County Commissioners appreciated Jim Gilmour’s presentation on the policy updates. It was well received and members now have a better understanding of how the process works.
Commissioner Dave Piepkorn adjourned the meeting at 1:19pm.