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HomeMy WebLinkAbout09/02/25 EDA MinutesEconomic Development Authority Meeting Minutes September 2, 2025 Vice-Chairman Huber called the meeting to order at 10:02 a.m. and asked for a roll call. Marlin Reeves- Aye Peter Huber- Aye Jefferey Worrell- Aye Lisa Webb- Aye Collette Hash- Aye Sabrina Cox- Aye Adoption of July 1, 2025 Minutes The motion was made by Ms. Cox and seconded by Mr. Worrell to adopt the minutes as written. The motion passed unanimously. Financials Review Manager Day led the discussion of financials, highlighting two primary sources of income: one from Bimmer World and another from a business located on Main Street. The Main Street business was funded through a $500,000 MUMS grant, while Bimmer World received $250,000, both structured as loans with interest. Additionally, ARPA funds previously implemented by the town had recently closed. He emphasized that these funds are unrestricted but must be used for economic development–related projects. One option would be to establish a revolving loan fund for businesses that cannot qualify for traditional bank financing. Manager Day cautioned the board, however, that if a bank refuses to provide a loan, the board should carefully consider whether it should step in. At times, banks may partially fund projects, leaving gaps that the EDA could help fill. The flexibility of the funds provides a wide range of possibilities, but decisions will require thoughtful planning. Manager Day confirmed that both businesses, Bimmer World and the Main Street business, are repaying their loans with interest, which secures future income. He noted that while the EDA only meets monthly, members could request additional meetings if they wished to brainstorm or develop new initiatives. He reminded them of the need to follow open meeting rules when communicating electronically. Staff could assist with developing recommendations for revolving loan programs, including creative options such as principal forgiveness. Vice-Chairman Huber underscored the importance of targeting specific industries rather than opening programs too broadly. He cited examples from the restaurant industry, where too many similar businesses had led to oversaturation and eventual closures. By being strategic, the EDA could strengthen the town’s overall economic environment. He noted the principle that EDA funds should not replace banks but rather complement them, particularly in situations where bank financing is insufficient. Manager Day explained that successful programs in other areas used banks as partners, ensuring businesses had “skin in the game” and financial vetting. Still, such programs can succeed or fail, and outcomes are never guaranteed. He stressed that all EDA funds must be administered with transparency and likely shared with the town government for awareness and coordination. He encouraged members to send him ideas for potential programs or businesses to support, noting that proposals could be circulated by email or brought to future meetings. Mr. Reeves raised the question of whether the EDA could impose its own restrictions on eligibility, such as requiring businesses to have been operational for a certain period before qualifying. Manager Day responded that the beauty and risk of local government funding is its flexibility: the board has wide latitude to set parameters. Different banks have varying requirements, and the EDA has the same freedom to create its own standards. Manager Day explained that the EDA has no formal restrictions at present but should adopt sound principles before issuing loans. When questioned by Ms. Cox, programs could be advertised through the town’s website or other outreach methods. For now, the board effectively has a “blank slate” to design criteria, including maximum loan amounts, eligible business types, and promotional strategies. Vice-Chairman Huber clarified that loans cannot be awarded on a personal basis but must follow the established criteria fairly and consistently. The board has discretion to determine whether funds are available “by right” if conditions are met, or whether additional judgment should be applied in evaluating risk. Manager Day emphasized the importance of developing solid internal guidelines for evaluating loan applications, rather than relying solely on outside information. Ms. Hash recalled that in the case of Bimmer World, the board had leaned heavily on the county’s background work because the EDA lacked its own criteria. Establishing a framework would allow for more independent decision-making in the future. Mr. Reeves questioned whether EDA loan decisions require council approval. Manager Day clarified that, under state law, the funds legally belong to the EDA. While he would personally want to keep the council informed and aligned, the EDA retains final authority to allocate the money as long as criteria are properly followed. Communication with other local officials and community leaders was encouraged to ensure informed decision-making and prevent oversights. He highlighted the importance of informal communication with school board members, planning commissioners, supervisors, and others to gather useful insights about potential businesses and community needs. He invited members to think creatively about the types of businesses that would strengthen the town’s economy, encouraging input from Ms. Ainsley and others with relevant perspectives. Rather than duplicating existing services, the EDA should identify gaps and opportunities where targeted investments could have the greatest impact. Ms. Ainsley shifted the conversation with the recognition that retail leakage studies—data showing what goods and services residents currently leave the area to obtain elsewhere—could provide valuable guidance. By identifying unmet local demand, the EDA could better direct its loan funds toward businesses that would succeed and benefit the community. Ms. Ainsley noted that both a dog park and a quality coffee shop had been identified as missing assets within the community. Dog parks in particular were highlighted as amenities that build community and attract residents. Ms. Hash referenced recent correspondence on the topic and cited examples of dog parks in Christiansburg and along the Huckleberry Trail, which were praised for their quality facilities. Experiences with building dog parks elsewhere were shared by Manager Day. In one case, a park initially drew no users until amenities such as water stations and dog baths were added, increasing the cost from an anticipated $30,000 to over $100,000. Radford’s dog park was also discussed, though it had been severely damaged by flooding and not rebuilt. The consensus was that successful parks require investment in infrastructure and amenities to make them attractive destinations. Safety considerations, such as internet or cell service to monitor dog fights and reduce liability, were also noted as important. As a result, Ms. Hassh suggested visiting the Christiansburg facility as a model and reviewing local studies further. This exchange, though sparked under financial review, revealed a broader interest in how economic development funds might support amenities that enhance quality of life and attract residents. Returning to the financial review, Ms. Cox asked whether the parameters of any loan or grant program could be adjusted if targeting did not attract sufficient applicants. Manager Day explained that the EDA has wide flexibility to modify programs, though bylaws require more formal negotiation. He recommended setting deadlines to create urgency, while leaving room to renew or change the program later. He also warned of common pitfalls in local loan programs, particularly conflicts of interest, where board members are pressured to support projects involving acquaintances. To prevent this, many governments use a council-manager form of oversight. The issue of loan defaults was raised. Mr. Reeves asked what recourse the EDA would have if a business failed to repay. Manager Day replied that recovery is difficult; some agencies, like the Virginia Tobacco Commission, attempt to pursue defaults, while others write them off entirely. Local governments can seek repayment, but often only add penalties without success. Ultimately, many defaults become losses, underscoring the risks of acting as a lender rather than a bank. The discussion concluded with acknowledgment that defaults are often unrecoverable, which reinforces the importance of strong criteria and careful lending decisions. With no further questions, the board moved on to the next agenda item: a presentation on housing. Presentations Housing Update- Shannon Ainsley, Economic Developer Shannon Ainsley, the town’s Economic Developer, gave an update on housing initiatives. She emphasized the direct connection between housing and economic development: businesses require workers, and workers require quality housing. Attracting and retaining talent depends on offering sufficient, modern housing stock, which also expands the town’s tax base. A recent housing study determined that Pulaski needs at least 172 new homes, either rentals or owner-occupied units. Ms. Ainsley stressed that this figure represents a minimum, as demand from surrounding areas suggests even more units could be filled. The town is responding through multiple strategies, including public-private partnerships, adaptive reuse of schools and warehouses, private single-family revitalization, and targeted projects like the “Revitalize” initiative. Notable projects include the Claremont School and Pulaski Middle School, to become Pulaski Lofts, two warehouse-to-apartment conversions, and numerous private investments in both new construction and rehabilitated properties. Ms. Ainsley detailed progress on specific developments. The Pulaski Lofts, created in a former middle school, are nearly complete and expected to open in October. Some tenants have already moved in. Units include studios as well as one-, two-, and three-bedroom apartments, starting at $1,100. Amenities include a clubroom, gym, and indoor basketball courts. The Claremont School project will open in two phases, with the first scheduled for 2025. Apartments there will begin at around $900, with finishes similar to Pulaski Lofts but more oriented toward workforce housing. Units will include income restrictions and require background checks. Ms. Ainsley introduced the Railwalk Apartments on First Street, across from the brewery. This adaptive reuse project transformed a severely dilapidated warehouse, once deemed ready for demolition, into modern, industrial-style apartments. Units feature open floor plans, large windows, and preserved historic elements, while also being walkable to Main Street. These apartments, starting at $895, are available in one- and two-bedroom layouts. Two buildings are part of this project, located near Thompson Tire. Ms. Ainsley emphasized how much effort the investors put into rehabilitating a structure that many would have abandoned. Beyond large-scale developments, private investors are also reshaping Pulaski’s housing market. Ms. Ainsley highlighted new condos on Washington and 5th and numerous single-family revitalization efforts. One investor aims to redevelop 40 properties in a single year, while others are heavily engaged in similar efforts, particularly in neighborhoods like Madison targeted by Project Revitalize. Progress on the South Madison homes includes subdividing one property into three lots, with additional blighted homes being transferred to the EDA for redevelopment. An ARS loan project is also nearing market readiness. Collectively, ongoing efforts will deliver 195 new units within the next year, with many more expected in the following five to six years. These projects, Pulaski Lofts, Claremont, Railwalk Apartments, new condos, and single-family revitalizations, are seen as critical steps in strengthening both housing availability and the broader economic health of the town. She reiterated that these developments directly support workforce needs and the town’s growth trajectory. Ms. Webb questioned if the 195-unit estimate applies to completions projected through 2025–2026, with several of the projects coming online in the immediate months ahead. Ms. Ainsley reported specific numbers for the first wave of new housing: 28 units in one project, 102 in Pulaski Lofts, 50 in Claremont, and 12 in another smaller development. Collectively, these represent major progress but still fall short of overall housing needs. Mr. Reeves inquired about the price point for the new condos on Washington and 5th, specifically whether they would be rentals or have income restrictions. Ms. Ainsley clarified that these are for-sale condos, not rentals. Prices are expected to be just under $200,000, with some estimates around $199,000 to $210,000. Final pricing depends on construction costs, which were not yet fully determined. A total of 12 units are planned, with the two end units priced slightly higher. The Memorial Drive project required lot line adjustments across six parcels. Surveying is underway to finalize plats and deeds for existing homeowners. Once complete, the property will be transferred to the developer, SHAH Development. Groundbreaking is expected by winter or early spring. Ms. Hash asked to be updated, especially since community members had been inquiring frequently about the project’s status. Board members thanked Ms. Ainsley for the thorough housing update and noted the visible progress across town. Interest was expressed in touring the Railwalk Apartments near Thompson Tire, which are designed for mixed-use, requiring a business license for commercial use on the ground floor. Election of Officers Chairperson Ms. Webb nominated Ms. Cox for chairperson. No other nominations were voiced. Mr. Worrell made a motion to elect Ms. Cox as chair. The motion passed unanimously. Secretary Ms. Cox nominated Ms. Webb as secretary. No other nominations were made. Mr. Worrell made a motion to elect Ms. Webb as secretary. The motion passed unanimously. Board Member Comments No comments were made. Reminder of Next Meeting Date Tuesday, October 7, 2025 at 10:00 a.m. With no further business, Chairperson Cox adjourned the meeting at 10:40 a.m.