Green Industrial Supply, Inc. Iowa Financial Assistance ApplicationMasterpiece on the Mississippi
Dubuque
All- America City
III r
2007
TO: The Honorable Mayor and City Council Members
FROM: Michael C. Van Milligen, City Manager
SUBJECT: State of Iowa Financial Assistance Application for Green Industrial Supply,
Inc.
DATE: August 31, 2011
Economic Development Director Dave Heiar is recommending submittal of a Financial
Assistance application to the Iowa Department of Economic Development on behalf of
Green Industrial Supply, Inc.
I concur with the recommendation and respectfully request Mayor and City Council
approval.
Mic Van Milligen
ael C.
MCVM:jh
Attachment
cc: Barry Lindahl, City Attorney
Cindy Steinhauser, Assistant City Manager
David J. Heiar, Economic Development Director
Masterpiece on the Mississippi
TO: Michael Van Milligen, City Manager
c'h
FROM: David J. Heiar, Economic Development Director
SUBJECT: State of Iowa Financial Assistance Application for Green Industrial Supply,
Inc.
DATE: August 18, 2011
Dubuque
kiltd
Ad- AnerIcaCily
2007
INTRODUCTION
This memorandum presents for City Council review and approval of a resolution
authorizing the submission of a Financial Assistance application to the Iowa Department
of Economic Development on behalf of Green Industrial Supply, Inc. The application is
attached.
BACKGROUND
Green Industrial Supply, Inc. will be constructing a 140,000 square foot
office /distribution and light manufacturing facility in the Dubuque Industrial Center West.
The site is on Innovation Drive across the street from !WI Motor Parts.
City staff has worked with the Greater Dubuque Development Corporation, Green
Industrial Supply, Inc. and Green Industrial Properties, LLC on an expansion plan for
their current business located at 10467 Hwy 52 N. They have committed to retaining the
current 41 full time positions, and adding at least 17 new jobs at the new facility.
Green Industrial Supply, Inc. is a local company that began in 1998 with 7 employees.
The company supplies parts and does light assembly for John Deere and its
subsidiaries in domestic and global locations. The company now has 41 employees
and anticipates the need for additional employees and space to accommodate the
expanded services they provide to John Deere. Green Industrial Supply is classified as
a home office of a multistate business.
On August 15, the City Council approved a Development Agreement which established
the terms of the sale of the property to Green Industrial Supply, Inc. The key elements
of the agreement included the following:
1) The purchase price is $120,000 per acre for 21.949 useable acres. An
Acquisition Grant to the developer reduces the cost to $60,000 per acre.
Approximately 11.5 acres of this site is identified for future expansion. If such
expansion does not occur, a portion of this acquisition grant will need to be
repaid to the City.
2) The property will be conveyed on or before October 1, 2011.
3) The company must construct a building of not less than 140,000 square feet
costing approximately $8,500,000.
4) Green Industrial Supply, Inc. and Green Industrial Properties, LLC must retain 41
full -time positions and create 17 new jobs within two years. The 58 jobs must be
retained for the term of the Agreement.
5) The company will receive a 10 year TIF in the form of a yearly tax rebate on the
value of the assessable improvements.
DISCUSSION
The application which was submitted to the Iowa Department of Economic Development
on behalf of the company would provide financial assistance to enable the company's
proposed development in Dubuque. As required by the State program, the application
requires a commitment of City funds to the project.
The local match for this application is in the form of Tax Increment Financing and a land
discount (acquisition grant) as described above.
In the essence of time to meet the company's plan to begin construction this year, this
application was submitted to the State prior to Council approval, to assure IDED's
consideration of the application at their August 18th Board meeting. The State approved
the application contingent on City Council authorization. The application can be
withdraw should the City Council decide not to approve the application.
RECOMMENDATION
I recommend that the City Council authorize an application for state assistance on
behalf of Green Industrial Supply, Inc. with a commitment of local matching funds, as
previously authorized in the Development Agreement on August 15.
This project is consistent with the City's goals to help businesses expand in the area,
increase the number of good paying jobs and further diversify the economic base of the
area.
ACTION STEP
The action step for the City Council is to adopt the attached resolution.
attachments
F: \USERS\Econ Dev \Green Industrial \IDED\20110818 Green Industrial IDED applicationCouncil memo.doc
RESOLUTION NO. 290-11
A RESOLUTION AUTHORIZING THE FILING OF AN APPLICATION FOR STATE
FINANCIAL ASSISTANCE ON BEHALF OF GREEN INDUSTRIAL SUPPLY, INC.
Whereas, Green Industrial Supply, Inc. has proposed the relocation and
expansion of its corporate offices in Dubuque, Iowa; and
Whereas, the City Council of Dubuque, Iowa has considered said proposal and
has determined that the proposed project will contribute to the local economy through
the retention of 41 jobs and the creation of 17 additional jobs; and
Whereas, the Iowa Department of Economic Development's Financial
Assistance Program was designed to assist in the economic development efforts of
local jurisdictions; and
Whereas, the City of Dubuque, Iowa is eligible to apply for funding from the Iowa
Department of Economic Development Department's Financial Assistance Program.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
DUBUQUE, IOWA:
Section 1. That the filing of an application for participation in the Iowa
Department of Economic Development's Financial Assistance Program on behalf of
Green Industrial Supply, Inc. is hereby approved.
Section 2. That the local match identified in the application estimated at $2,977,000
consisting of TIF funding and a land discount was approved in the Development
Agreement to develop the property in the Dubuque Industrial Center West.
Section 3. That the Mayor is hereby authorized to execute and the City Manager is
hereby directed to submit said application to the Iowa Department of Economic
Development together with such documents as may be required.
Passed, approved, and adopted this 6th day of Sep mber
Pq
Roy D. Buol, Mayor
Attest: �,
ev' S. Firnsfahl, Acting ity erk
F:\USERS\Econ Dev\Green Industrial\IDED\20110818 Resolution Green Industrial App approval.docx
IOWA
economic DEVELOPMENT
Debi V. Durham, Director
Iowa Department of Economic Development
Business Financial Assistance
Application
Business Finance
Business Development Division
Iowa Department of Economic Development
200 East Grand Avenue
Des Moines, Iowa 50309 -1819
www.iowalifechanging.com
Telephone: 515.725.3133
businessfmance@iowa.gov
v.7.11.2011
Application Instructions
To Complete Electronic Form: Click on TEXT BOX to add text. Double click on YES /NO boxes and select "Checked ".
1. All applicants must complete the Business Financial Assistance Application and attach only those additional sections
for the components to which the applicant is applying.
Direct Financial Assistance — STATE of IOWA
® 130% Component
(no supplement)
❑ 100% Component
(no supplement)
❑ Entrepreneurial Component (and Supplement)
Supplemental ilfotmation required
Tax Credits — STATE of IOWA
p Enterprise Zone Program (EZ)
Supplemental i! formation required
Direct Financial Assistance — FEDERAL
❑ Economic Development Set -Aside Program (EDSA)
Supplemental information required
❑ Infrastructure Component
(no supplement)
❑ Value -Added Agriculture Component
Supplemental information required
❑ Disaster Relief Component
Supplemental information required
® High Quality Jobs Program (HQ)
no supplement)
❑ Public Faclities Set -Aside Program (PFSA)
Supplemental i! formation requited
2. Please visit the IDED Web site at www.iowalifechanging.com or contact IDED at 515.725.3133 to confirm that this is
the most current application version.
3. Before filling out this application form, please read all applicable sections of the 2009 Iowa Code and Iowa
Administrative Code (rules). www .legis.state.ia.us /IowaLaw.html
4. Only typed or computer- generated applications will be accepted and reviewed. Any material change to the format,
questions, or wording of questions presented in this application will render the application invalid and it will not be
accepted.
5. Complete the applicable sections of the application fully. If questions are left unanswered or required attachments are
not submitted, an explanation must be included.
6. Use clear and concise language. Attachments should only be used when requested or as supporting documentation.
7. Any inaccurate information of a significant nature may disqualify the application from consideration.
8. The following must be submitted to Business Finance at IDED in order to initiate the review process:
• One original, signed application form and all required attachments
• One electronic copy of the application form and all required attachments
Facsimile copies will not be accepted.
Business Finance
Iowa Department of Economic Development
200 East Grand Avenue
Des Moines, IA 50309 -1819
Telephone: 515.725.3133
businessfinance at 'owa.gov
Applications are must be submitted to IDED Business Finance before 4:00pm on the fourth Monday of
the month.
Applications will be reviewed by the IDED Board on the third Thursday of the following month.
IDED — Business Financial Assistance Application 2 v.7.11.2011
Public Records Policies
Information Submitted to IDED. The Iowa Department of Economic Development (IDED) is subject to the Open
Records law (Iowa Code. Chapter 22). Treatment of information submitted to IDED in this application is governed by the
provisions of the Open Records law. All public records are available for public inspection. Some public records are
considered confidential and will not be disclosed to the public unless ordered by a court, the lawful custodian of the record,
or by another person duly authorized to release the information.
Confidential Records. IDED automatically treats the following records as confidential and they are withheld from public
disclosure:
• Tax Records
• ,Quarterly Iowa Employer's Contribution and Payroll Repent prepared for the Iowa Workforce Development Department
• Payroll Registers
• Business Financial Statements and Projections
• Personal Financial Statements
Other information supplied to IDED as part of this application may be treated as confidential under Iowa Code section
22.7. Following are the classifications of records which are recognized as confidential under Iowa law and which are most
frequently applicable to business information submitted to IDED:
• Trade secrets [Iowa Code §22.7(3)]
• Reports to governmental agencies which, if released, would give advantage to competitors and serve no public purpose.
[Iowa Code §22.7(6)]
• Information on an industrial prospect with which the IDED is currently negotiating. [Iowa Code §22.7(8)]
• Communications not required by law, rule or regulation made to IDED by persons outside the government to the
extent that IDED could reasonably believe that those persons would be discouraged from making them to the
Department if they were made available for general public examination. [Iowa Code §22.7(18)]
Information supplied to IDED as part of this application that is material to the application and /or the state
program to which the applicant is applying including, but not limited to the number and type of jobs to be
created or retained, wages for those jobs, employee benefit information, and project budget, are considered open
records and will not be treated as confidential.
Additional Information Available. Copies of Iowa's Open Record law and IDED's administrative rules relating to public
records are available from the IDED upon request.
IDED — Business Financial Assistance Application 3 v.7.11.2011
Applicant Information
Name of Business: Green Industrial Supply, Inc.
Address: 10467 Hwy 52 N
City, State & Zip Code: Dubuque, Iowa 52001
Contact Person: Patrick J. Green Title: Vice President
Phone: 563 - 557 -5184 Fax: 563 -584 -1886 Email: pgreen @grnind.com
Federal ID Number: 81- 0564317
NAICS Code for primary business operations: N/A
US DOT Number: N/A
Does the Business file a consolidated tax return under a different tax ID number?
® No
If yes, please also provide that tax ID number:
Is the contact person listed above authorized to obligate the Business?
® Yes ❑No
If no, please provide the name and title of a company officer authorized to obligate the Business:
If the application was prepared by someone other than the contact person listed above, please complete the following:
Name of Business:
Address:
City, State & Zip Code:
Contact Person: Tide:
Phone: Fax: Email:
Sponsor Information
Sponsor Organization: City of Dubuque
Official Contact (e.g. Mayor, Chairperson, etc.): Roy D. Buol
Address: City Hall, 50 West 13th Street
City, State & Zip Code: Dubuque, Iowa 52001
Phone: 563 -589 -4110 Fax: 563 - 589 -4149
Title: Mayor
Email: rdbuol @cityofdubuque.org
If IDED needs to contact the sponsor organization with questions, should we contact the person listed above?
Yes ❑ No, please contact the following person:
Name: David J. Heiar Title: Economic Development Director
Address: City Hall, 50 West 13th Street
City, State & Zip Code: Dubuque, Iowa 52001
Phone: 563 - 589 -4393 Fax: 563 - 589 -1733 Email: dheiar @cityofdubuque.org
If necessary, please list information on additional sponsors in an attachment.
IDED — Business Financial Assistance Application 4 v.7.11.2011
Certification & Release of Information
I hereby give permission to the Iowa Department of Economic Development (IDED) to research the Business' history,
make credit checks, contact the Business' financial institutions, insurance carriers, and perform other related activities
necessary for reasonable evaluation of this application. I also hereby authorize the Iowa Department of Revenue to provide
to IDED state tax information pertinent to the Business' state income tax, sales and use tax, and state tax credits claimed.
I understand that all information submitted to IDED related to this application is subject to Iowa's Open Record Law
(Iowa Code, Chapter 22).
I understand this application is subject to final approval by IDED and the Project may not be initiated until final approval is
secured.
I understand that IDED reserves the right to negotiate the financial assistance. Furthermore, I am aware that financial
assistance is not available until an agreement is executed within a reasonable time period following approval.
I hereby certify that all representations, warranties, or statements made or furnished to IDED in connection with this
application are true and correct in all material respect. I understand that it is a criminal violation under Iowa law to engage
in deception and knowingly make, or cause to be made, directly or indirectly, a false statement in writing for the purpose of
procuring economic development assistance from a state agency or subdivision.
For the Business:
Signature
Patrick Green. Vice President
Name and Title (typed or printed)
Roy D. Buol, Mayor
Name and Title (typed or printed)
2-
Date
° ,(34//
Date
Please ruse the following if mome than one sponsor (For examp /e, tire this if a signature finny the local Eateuprise Zone Comrnirsion is
rgrned in addition to the signature fnnm the Mayor of the sponsoring cify)
Signature Date
Name and Title (typed or printed)
IDED will not provide assistance in situations where it is determined that any representation, warranty, or statement made
in connection with this application is incorrect, false, misleading or erroneous in any material respect. If assistance has
already been provided prior to discovery of the incorrect, false, or misleading representation, IDED may initiate legal action
to recover incentives and assistance awarded to the Business.
IDED — Business Financial Assistance Application 5 v.7.11.2011
Business Information
Provide a brief description and history of the Business. Include information about the Business' products or services and its markets
and /or customers. Green Industrial supplies Production and Service Parts to John Deere and 60 of their subsidiaries
worldwide. We import, export , warehouse , manage inventory and provide Quality Engineering and Warranty recovery
services to John Deere.
Business Structure:
❑ Cooperative Corporation ❑ Limited Liability Company ❑ Not for Profit
❑ Partnership ® S- Corporation ❑ Sole Proprietorship
State of Incorporation: Iowa
Identify the Business' owners and percent ownership:
Does a woman, minority, or person with a disability own the Business? ❑ Yes ® No
If yes, is the Business certified as a Targeted Small Business? ❑ Yes ❑ No
List the Business' Iowa locations and the current number of employees at each location. Dubuque, 47 employees
What is the Business' worldwide employment? Please include employees of parent company, subsidiaries, and other affiliated entities in
this figure. N/A
Project Information
Project Street Address: 1525 Innovation Drive
Project City: Dubuque Project County: Dubuque
Type of Business Project:
❑ Startup
❑ New Location in Iowa
® Expansion of Iowa Company
❑ Relocation from another State
Briefly describe the proposed project for which assistance is being sought. (Include project timeline with dates, facility size,
infrastructure improvements, proposed products /services, any new markets, etc.)
The company intends to construct a 120,000 sq. ft. warehouse with an attached 20,000 sq. ft. office on a 20 acre site in the Dubuque
Industrial Center West. The Developer will start in September 2011 and the project will be completed by July 2012. This expansion is
the result of contracts with John Deere and 60 of their subsidiaries worldwide.
Project Timeline (add additional rows as needed)
Activity Completion Date
Project will begin September 2011
July 2012
Please identify the project management for the project location and experience.
Has any part of the project started?
If yes, please explain.
Identify the Business' competitors. If any of these competitors have Iowa locations, please explain the nature of the competition (e.g.
competitive business segment, estimated market share, etc.) and explain what impact the proposed project may have on the Iowa
competitor. N/A
❑Yes El No
Will any of the current Iowa employees lose their jobs if this project does not proceed in Iowa?
❑ Yes ® No
If yes, please explain why and identify those jobs as "retained jobs" in the Project Jobs section.
IDED — Business Financial Assistance Application 6 v.7.11.2011
Project Budget
AMOUNT BUDGETED
Use of Funds
Cost
Source A
Source B
Source C
Source D
Source E
Source F
Source G
Land Acquisition
2,400,000.
Forgivable Loan /Loan
0 %, 3 yrs
1,200,000.
1,200,000.
Source B: Other State
(Community College,
IDOT, etc.)
300,000
Land acquisition grant
Site Preparation
300,000.
Funded at property closing
Source C: City of Dubuque
Building Acquisition
$2,365,000
Cash /Equity
1,000,0007
Source E: Other Private Sources
7,420,0007
Building Construction
8 500,000
8 0, 0 0 0.
Source F: American Trust &
Savings Bank
$7,720,000
Building Remodeling
Source G: 4
Mfg. Machinery& Equip.
TOTAL
$11,365,000
Other Machinery & Equip.
90,000.00
9 0, 0 0 0.
Racking, Shelving, etc.'
Computer Hardware
45,000.00
4 5, 0 0 0.
Computer Software
Furniture & Fixtures
30,000.00
30,000.
Working Capital
.
Research & Development
Job Training
TOTAL
$11,3651000
$80,000
$
$1,200,000 '
$2,365,000
$
$7,720,000
$
I Racking, shelving and conveyor equipment used in distribution center projects only
Does the Business plan to lease the facility? i4 No If yes, please provide the Annual Base Rent Payment (lease payment
minus property taxes, insurance, and operating /maintenance expenses) and the length of the lease agreement.
PROPOSED FINANCING
Source of Funds
Amount
Form of Funds
Rate and
Term
Commit m
ent Status
Conditions /Additional
Information
(List tax benefits separately below, not as a
source of direct financing)
(Loan, Grant, In -Kind,
Donation, etc.)
Include when funds will be disbursed;
If loan, whether payments are a level
term, balloon, etc
Source A: IDED*
$80000.
Forgivable Loan /Loan
0 %, 3 yrs
Local Property Tax Exemption
Source B: Other State
(Community College,
IDOT, etc.)
$
$1,200,000.
Land acquisition grant
1,770,000
City of Dubuque
Funded at property closing
Source C: City of Dubuque
Source D: Green Industrial Supply
$2,365,000
Cash /Equity
TOTAL
Source E: Other Private Sources
$
Source F: American Trust &
Savings Bank
$7,720,000
Loan
Source G: 4
$
TOTAL
$11,365,000
* Identify the collateral used to secure IDED funds: Personal Guarantee from Patrick Green and Mary Sue, co- owners
TAX CREDITS AND INDIRECT FINANCING
Source of Funds
Amount
Description
Investment Tax Credit
449,800
HQJP Program
HQJP Program
Sales, Service & Use Tax Refund
255,000
Research Activities Credit (3 % /10 %)
Withholding
Local Property Tax Exemption
Tax Increment Financing
1,770,000
City of Dubuque
260E Job Training Funds
75,600
Northeast Iowa Community College
In -kind Contribution
Other
TOTAL
$2,550,400
What measures were analyzed to determine the amount and form of assistance needed? Gap financing measures
Is the Business actively considering locations outside of Iowa?
❑ Yes ® No
IDED — Business Financial Assistance Application 7 v.7.11.2011
If yes, where and what assistance is being offered?
There are three general justifiable reasons for assistance. Check the box next to the reason why assistance is needed to complete this
project.
• Financing Gap - The Business can only raise a portion of the debt and equity necessary to complete the project. A
gap between sources and uses exists and state and /or federal funds are needed to fill the gap.
❑ Rate of Return Gap — The Business can raise sufficient debt and equity to complete the project, but the returns are
inadequate to motivate an "economic person" to proceed with the project. Project risks outweigh the rewards.
❑ Location Disadvantage (Incentive) — The Business is deciding between a site in Iowa (site A) and a site in another
state (site B) for its project. The Business argues that the project will cost less at site B and will require a subsidy to equalize
costs in order to locate at site A. The objective here is to quantify the cost differential between site A and site B.
IDED — Business Financial Assistance Application 8 v.7.11.2011
Project Jobs
List the jobs that will be created and /or retained as the result of this project. (A retained job is an existing job that would be eliminated;
or moved to another state if the project does not proceed in Iowa.) For jobs to be created, include the ptarting and final hourly wage
rate. For retained jobs, include the current hourly wage rate.
Is the hourly wage rate based on a 40 hour work week, 52 weeks per year? ® Yes ❑ No
If no please explain:
Full -Time CREATED Jobs
(Add additional rows as needed)
Job Title
Number of
CREATED
Jobs
Starting
Hourly Wage
Hourly Wage at
End of Year
Three
HR Manager
1
$22.50
$30.00
Supplier Quality Engineer
1
$20.00
$25.00
Supplier Quality Technician
1
$18.00
$22.00
Accounting
1
$18.00
$24.00
Supply Management Spec. PDP
1
$20.00
$26.00
Supply Management Spec. OFP
2
$18.00
$26.00
Parts Expediters
2
$16.00
$19.00
Warehouse & Assembly
5
$12.00
$17.00
Warehouse Assistant Managers
2
$16.00
$22.00
Total CREATED Jobs
16
Full Time RETAINED Jobs
(Add additional rows as needed)
Job Title
Number of
RETAINED Jobs
Current Hourly
Wage
Total RETAINED Jobs
IDED — Business Financial Assistance Application 9 v.7.11.2011
Employee Benefits
Please identify awl employee benefits provided by and paid for in full or in part) by the Business.
Employee
Benefits Provided
by Business
Total Annual Cost
(show on a per
employee basis)
Portion of Total
Annual Cost Paid by
the Business
Plan Provisions
Employee
Family
Employee
Family
Deductible
(Include coinsurance %, office visit co-
payments, annual out -of- pocket
maximums, face amounts, etc.)
IDED — Business Financial Assistance Application 10 v.7.11.2011
•
Business Taxes
IDED is required to calculate the return on state and local government investments in this project. Data from other parts of the
application will be combined with the estimates requested below to calculate the required return on investment information. Please read
the following directions carefully:
• IDED is asking for a best estimate on the increase in taxes associated with this project.
• Estimates should only include the expected increase in tax liability resulting from this project.
• At minimum, IDED needs estimates for the first three years of the project.
• Show data as if no tax abatements or tax credits_ awarded for this project were. taken.
• For partnership forms of ownership (e.g. limited partnerships, s- corporations, LLC, etc.), please estimate the partners'
increase in Iowa tax liability due to this project.
• Sales and use taxes refer to the taxes paid on materials, etc. that the Business purchases, not taxes you collect from
sales to your customers.
• Applicants will not be held to these numbers with respect to any award from or contract with IDED.
• This page of the application will automatically be treated as confidential.
COIF FID FNTIAL
IDED — Business Financial Assistance Application 11 v.7.11.2011
Attachments
Please attach the following documents:
Al Business Plan
At a minimum, include:
• Marketing study
• Feasibility study
• Projected profit and loss statements for three years into the future
• Project budget
• Production operations
• Management structure
• Personnel needs
• Descriptions of product or process
• Status of product /process development
• Patent status (if applicable)
(Any information outlined above not included in the business plan should be submitted as supplemental information via a
separate attachment.)
A2 Copies of the Business' Quarterly Iowa Employer's Contribution and Payroll Report Summary Page (Page 1) for the
past year and a copy of the most recent payroll report for one pay period. The copy of the most recent payroll report for one
pay period must be in Excel format and include the following information:
• Company name, date of payroll and source of payroll information
• Employee name and /or employee identification number
• Current hourly wage - do not include bonuses or other benefit values
• Indicate if the employee is full time (40 hours per week, 52 weeks per year) or part time.
A sample Excel spreadsheet can be found at http: / /www.iowahfechanging.com /applications /bus_dev /payroIl_template.xls
A3 Affidavit that states the Business has not, within the last five years, violated state or federal statutes, rules, and regulations,
including environmental and worker safety regulations, or, if such violations have occurred, that there were mitigating
circumstances or such violations did not seriously affect public health or safety or the environment. A sample affidavit can be
found at http : / /www.iowalifechanging.com/ applications /bus_dev /sampleaffidavit.doc.
A4 Financial Information (Existing Businesses Only)
• Profit and loss statements and balance sheets for past three year -ends;
• Current YTD profit and loss statement and balance sheet;
• Schedule of aged accounts receivable;
• Schedule of aged accounts payable; and
• Schedule of other debts.
IOWA
eeonorni( DEVELOPMENT
IDED — Business Financial Assistance Application 12 v.7.11.2011