#1 Authorize to enter into a TIF development agreement with ANGI Energy Systems (File Res. #2012-906)Economic Development Department Memorandum
April 23, 2012
TO: City Council
FROM: Vic Grassman, Economic Development Director
SUBJECT: Action on a Proposed Resolution Authorizing the City Manager to
Enter Into a TIF Development Agreement with ANGI Energy
Systems (File Res 2012-906)
Executive Summary
ANGI Energy Systems, currently located at 15 Plumb Street, Milton, WI has
leased the entire building (215,000 s.f.) located at 305 W. Delavan Drive in
Janesville. The building is owned by Tom Lasse and Terry McGuire. (Badger
Property Investments) During the next few months, ANGI plans to vacate its
Milton facility and relocate to the above address which will provide the company
with significantly more office and manufacturing space. They will relocate 108
existing jobs into Janesville and create 25 additional jobs over the first three
years for a total of 133 full time jobs.
ANGI Energy Systems Inc. (www.angienergy.com) is a U.S. based, family
owned manufacturer of quality CNG equipment (compressed natural gas). ANGI
is considered a global leader and innovator in the compression industry and has
40 years of experience in providing compressed natural gas solutions to its
customers. According to the EPA, CNG environmental benefits include a carbon
dioxide reduction of 90%, ground level ozone emissions by 75% and greenhouse
gas emissions by 25%.
City Manager’s Recommendation:
The City Manager concurs with the Economic Development Director’s
recommendation. This relocation will ensure that we are able to retain the
current jobs in Rock County and provide the opportunity for the expansion of jobs
in the future.
Economic Development Director’s Recommendation:
I recommend that a forgivable TIF loan of $215,000 be offered to this company.
The terms of this forgivable loan will be ten annual payments of $21,500 based
on the employment benchmarks as noted in the Developers Agreement.
This is based on the following:
This recommendation is consistent with the Council’s TIF guidelines of
$1.00/square foot leased.
This company is recognized as the leader in its field on an international
basis. (It currently has an office in Shanghai, China and has the largest
market share worldwide in its industry.)
It produces products that support sustainability, environmental protection
and mitigation, all of which would provide an important addition to
Janesville’s current and future advanced manufacturing industry base.
This would create a positive economic development event for Janesville
and a media opportunity.
This company needs additional space to grow. This building is the only
one in Rock County that meets their needs. Otherwise, they could
potentially move out-of-state.
Suggested Motion
I recommend that the City Council adopt Resolution 2012-906.
Analysis
The property at 305 W. Delavan Drive is not within an existing TIF District, but is
within ½ mile of TIF 26. Therefore, funding for this incentive will come from TIF
26. Under state law, TIF funds can be used for projects outside of a TIF if they
are within ½ mile of the boundary and this provision is in the TIF plan and or
subsequent amendments. Amendment #3 to TIF 26 in 2009 added this provision
to the existing plan. Assuming that ANGI meets its employment benchmarks and
the loan is completely forgiven, TIF 26 is projected to have a positive balance of
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$109,987 in 2023 (its 21 year) and should the TIF fully complete its legal life,
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2025 (23 year) it is projected to have a positive balance of $427,919.
cc: Eric Levitt
Jacob Winzenz
Resolution 2012-906
A Resolution Approving a TIF 26 Development Loan Agreement and Promissory Note
with ANGI Energy Systems for $215,000
WHEREAS, the Common Council of the City of Janesville created Tax Incremental Finance
District No. 26 in accord with Wisconsin’s Tax Increment Financing Laws, Wis. Stats. Sec.
66.1105 and other applicable statutes, as from time to time amended or renumbered, in order to
stimulate the development and redevelopment of industrially zoned properties; retain and
increase employment; construct, renovate and expand industrial facilities; and otherwise provide
for the overall economic health, welfare, vitality, and good of the community; and
WHEREAS, the Project Plan for TIF District 26 includes industrial and manufacturing
development and redevelopment, improvements, facility construction, expansion, and
renovation, job retention and creation, and Amendment #3 which includes the ability to assist
projects within ½ mile outside TIF 26 boundaries and related financing, incentives, payments,
loans, and actions that effectuate and/or facilitate these public purposes and goals; and
WHEREAS, ANGI Energy Systems (ANGI) is a manufacturer of natural gas compression
equipment conducting its principal business at 15 Plumb Street, City of Milton, County of Rock,
State of Wisconsin, has signed a ten (10) year lease with Badger Property Investments for
215,000 sq. ft. at 305 W. Delavan Dr. Janesville (“Facility’), contingent upon City and state
incentives. ANGI intends to retain 108 jobs and create 25 new jobs within three years and
would like to begin production by August 1, 2012. ANGI will create an additional 8 jobs in Year
1, 9 jobs in Year 2 and 8 jobs in year using the above production starting date
WHEREAS, ANGI promises to upgrade and renovate operate the Facility, create and maintain
new employment at its Janesville Facility, and otherwise benefit and add value to the City, TIF
District, and the City’s tax base, and has requested forgivable TIF 26 loan in the amount of Two
Hundred Fifteen thousand dollars($215,000), upon the terms, in the manner, and otherwise in
consideration of a standard Janesville TIF economic development forgivable loan, the terms and
provisions of which are reiterated and incorporated herein by reference as if fully set forth
verbatim, with TIF 26 projected to break-even in Year 20 (2022) and by its final year (2025) it is
projected to have a positive balance of $630,188; and
WHEREAS, there are currently sufficient positive fund balances in the TIF District 26
improvement and overall project accounts, and these expenditures fall within the allowable time
and scope for said Development Agreement and expenditures; and
WHEREAS, the Common Council hereby find that the City Administration has negotiated the
TIF Development Loan Agreement and Promissory Note with ANGI upon terms, conditions,
promises, obligations, provisions, and purposes, consistent with the best interest of and benefit
to the City, all applicable laws, and Common Council industrial and economic development
policies, goals, objectives, and directives.
NOW, THEREFORE, BE IT RESOLVED, by the Common Council of the City of Janesville that:
1. Each and every of the above recitals are reiterated and incorporated herein by reference
as if fully set forth verbatim; and
2. The City’s standard ANGI Development Loan Agreement and Promissory Note once
finalized are also reiterated and incorporated herein by reference as if fully set forth verbatim;
and
3. The ANGI TIF 26 Development Loan Agreement and Promissory Note, and all
expenditures, terms, conditions, promises, obligations, and provisions set forth therein are
hereby found to be in the best interest of, and for the benefit of, the City, and, therefore, are
hereby both authorized and approved, as from time to time amended by the City Manager; and
4. The City Manager and/or his designee(s) is/are hereby authorized to execute, enter into,
and effectuate the TIF 26 Development Loan Agreement and Promissory Note with ANGI on
behalf of the City of Janesville; and
BE IT FURTHER RESOLVED, that the City Manager and/or his designee(s), on behalf of the
City of Janesville, is/are hereby authorized to administratively negotiate, draft, execute, review,
enter in, modify, amend, record, file, and otherwise effectuate the above agreements and
promissory note, and/or to make and enter into any and all other agreements, contracts,
documents, papers, and forms, and/or to take whatever other actions that the City Manager
and/or his designee(s) may, from time to time and at any time, determine necessary and/or
desirable to effectuate the above transactions, agreements, and/or above all the intent and/or
purposes of this Resolution.
ADOPTED:
Motion by:
Second by:
APPROVED:
Councilmember Aye Nay Pass Absent
Dongarra-Adams
Farrell
Eric J. Levitt, City Manager
Kealy
Liebert
ATTEST:
Severson
Steeber
Voskuil
Jean Ann Wulf, City Clerk-Treasurer
APPROVED AS TO FORM:
Wald Klimczyk, City Attorney
Proposed by: Economic Development Director
Prepared by: City Attorney