04141997 Regular Meeting - Laserfiche WebLink

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109 Regular Meeting April 14, 1997 ' Page 12 not identified the equivalent in total, just some portions as they go along. On roll call the following vote was recorded for adoption of the Resolution: Aye: Mihalkanin, Hughson, Hart, Guerra, Cox, Hernandez Abstain: Moore Mayor Moore introduced for consideration adoption of a Resolution, the caption which was read as follows: A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN MARCOS, TEXAS, APPROVING A TRANSFER OF FUNDS FOR THE SMALL BUSINESS INCUBATOR; DIRECTING STAFF TO SUBMIT A CONTRACT AMENDMENT REQUEST TO THE TEXAS DEPARTMENT OF HOUSING AND COMMUNITY AFFAIRS; AND DECLARING AN EFFECTIVE DATE. Mr. Mihalkanin moved to have the Resolution removed from the table and Ms. Hughson seconded the motion. On roll call the following vote was recorded: AYE: Hughson, Hart, Guerra, Cox, Hernandez, Mihalkanin ABSTAIN: Moore Mr. Mihalkanin moved for adoption of the Resolution and Mr. Cox seconded the motion. Ms. Hughson stated the last time this Resolution had come before the Council she had asked for a full budget to see exactly what is being asked to do on this. Mr. Mihalkanin asked what was the rationale for requesting funds allocated for machinery and equipment to working capital. Mr. Gervais stated this budget was set 4 years ago and normally budgets of this size total about $650,000 and normally are revised on an annual basis to reflect the changes and the specific rationale of the City funds totaling $99,000 of which approximately $46,000 went to equipment and furnishings and the rest went to operations. Mr. Gervais stated this was set back in the middle of 1993 and had not been altered since then. Mr. Gervais stated some events had taken placed that needed them to change for example the fire was very difficult to budget and due to the fire and bidding delay they lost 15 months and cost them an additional $45,000 in operational funds. Mr. Gervais stated through efficient operations the amount before the Council is what needs to be transferred. Mr. Gervais stated they had also compensated by using used furniture and buying a copier for $3,000. Mr. Hart stated he did not understand the incubator setup and it looked like a big, bureaucratic mess. Mr. Hart stated he would vote for the transfer but hopes the incubator will find a way to operate without additional money. Mr. Gervais stated at the end of the bureaucratic mess there is a deadline to complete the State grant. Mr. Gervais stated the ending of the contract is being finalized and then they will be able to operate without a lot of detail requirements. Mr. Gervais informed the Council the incubator is not even a year old and has a lot of life ahead. Mr. Gervais stated at present there are 33 jobs which had been created in eight months and will see more jobs in 3-5 years. Mr. Guerra asked if the City's involvement with CDBG would end. Mr. Ronson stated they were thinking of asking for another extension of 90 days on the state contract for paper work and are anticipating the 21st of July for completion of the contract. Mr. Ronson stated within the contract is a requirement that the incubator be operative as an incubator for a certain amount of time and that ends in 1999. Mr. Ronson stated the City is responsible to make sure it operates as an incubator during that time. Mr. Ronson stated the City would be responsible for paying certain funds which the State has granted. Mr. Ronson stated the City would not be required to pay on the Revolving Loan. Mr. Ronson stated the grant money received from the State which is about $103,000 there would be an incremental amount which the State would require repayment if they ceased to operate early. Ms. Hughson stated if the City would be under financial obligation or oversight obligation in responsibility obligation. Mr. Ronson stated the City would be responsible for both. Mr. Ronson stated at the end of the 90 days the City can close the financial contract with the State which means all the paper work would be taken care of but contained within the contract. There is a requirement for this facility to be operated as an incubator for a certain