s100614 Joint Aboro TechnimarkOctober 6, 2014
Joint Special Meeting with Asheboro City Council
The Randolph County Board of Commissioners met jointly with the Asheboro City Council in
special session at 6:00 p.m. in the Randolph County Historic Courthouse, 145 Worth St., Asheboro,
NC. Commissioners Harold Holmes, Darrell Frye, Stan Haywood, Phil Kemp and Arnold Lanier
were present, as well as, County Manager Richard Wells; Finance Officer Will Massie; Associate
County Attorney Aimee Scotton; Amanda Varner, Clerk to the Board and Dana Crisco, Deputy
Clerk to the Board. In attendance from the City of Asheboro were Mayor David Smith; Council
members Charles Swiers, Clark Bell, Linda Carter, Talmadge Baker, Eddie Burks, Mike Hunter
and Walker Moffitt; City Manager John Ogburn; Holly Doer, Clerk to the Council; City Finance
Officer Debbie Reaves and City Attorney Jeff Sugg; and Bonnie Renfro, EDC President.
At 6:00 p.m., Chairman Holmes called the meeting to order for the County and welcomed
those in attendance.
Mayor David Smith called the meeting to order on behalf of the City and opened the public
hearing for the City.
Chairman Holmes opened the public hearing on behalf of the County.
Incentives Request for Technimark LLC
Bonnie Renfro, EDC President, stated that Technimark LLC, headquartered in north
Asheboro is a private company with 12 global manufacturing sites in Asheboro, Mexico,
Germany and China. The company is one of the 15 largest plastic injection molders in the US
and sells into three major market segments, consumer packaging, technical specialties and
proprietary products. The company's core services are plastic injection molding, sub -assembly,
and decoration. These are supported by a Technology/RD group with more than 25 employees
involved in product development, industrial design, engineering and tool building services.
Customers, many of which are Fortune 500 companies, are very diverse and represent a wide
array of markets including Wal-Mart, Proctor & Gamble, Estee Lauder and Black & Decker.
Industries served include consumer packaging, industrial components and consumer durable
products.
Ms. Renfro highlighted the additional information about Technimark, the project and the
incentive package:
• Technimark has received numerous awards for sustainability and quality product and
service from their customers and industry, including recognition by Wal Mart as the
supplier with the most significant contribution to sustainability and by Proctor and
Gamble as a Supplier of Excellence six years in a row and as a Super Supplier, in the top
15 of 80,000 suppliers.
• Their global growth pattern is more than 10% annually. In Asheboro they currently have
five injection molding sites, one recycled resin compounder, and one tool shop as well as
the corporate offices and technology and design center.
• One of Technimark's unique proprietary products is the recycling and compounding of
plastic materials for re -use in injection molding facilities or for sale in the market. They
set-up this facility initially to prevent customers of their proprietary products from
throwing some single -use packages into landfills.
• At a sister company, Wellmark, they operate a dedicated recycling facility combined with
a full-service compounding operation that can tailor make the recycled materials to the
exact specifications required for use in high-end applications.
• Technimark has secured additional business from existing customers and gained
significant new contracts, requiring additional production capacity. Within their global
footprint on three continents, they have multiple opportunities and inquiries to grow with
customers globally and in other regions of the U.S. Over the last several months, the
company has considered various locations for new US production capacity including
Asheboro and locations in five states in the Midwest and Mid -Atlantic US. Multiple
customers have asked that they consider injection molding factories closer to their filling
centers.
• This highly competitive project could mean broad benefits for continued growth in
Asheboro and Randolph County. Technimark has requested consideration of economic
assistance and incentives from the city, county and state of North Carolina to offset costs
during the initial phases of establishing a new operation.
• The company is considering construction of a new rail served manufacturing facility at
527 W. Central Avenue in Asheboro that would provide expanded molding capacity to
meet client demand. Over the next five years, the company and its related parties would
invest $46 million in both real and personal property to create new manufacturing and
related distribution.
• The manufacturing execution strategy requires highly skilled and motivated technical
staff and manufacturing teams. Current employment at the five Asheboro manufacturing
facilities and corporate offices totals 981. The company also employs approximately 170
contract workers at entry level production jobs.
• This expansion project would result in creation of 224 new jobs over five years, making
Technimark Randolph County and Asheboro's largest manufacturing employer with
1,205 direct full time employees. Average wages of $31,266/year for the new jobs will
exceed Randolph County's average weekly wage standard and in addition they offer a full
benefit package valued at 25% of wages.
• The project will expand the 600,000+ square feet of current owned and leased space in
Randolph County.
Ms. Renfro asked that the City of Asheboro and Randolph County authorize all appropriate
resolutions and document preparation to enter into an economic development incentives contract
with Technimark LLC., as permitted by North Carolina General Statute Section 158-7.land that
the City of Asheboro and County of Randolph provide to Technimark a total of $1,000,000 to
assist the company with costs associated with the expansion project.
Ms. Renfro proposed that Asheboro provide a total of $500,000 and Randolph County
provide a total of $500,000, sharing equally in the funding assistance. The funding to be paid in
no less than six annual installments contingent on the company meeting job creation and
investment performance requirements. Those requirements would be formalized in an economic
incentives agreement. The company would agree to remain in operation in Randolph County for
six years following the date of the final installment of the incentive payment. If the company
does not remain in full operation, a portion of the incentive money must be returned to the City
and County.
Ms. Renfro said that one has to look at the total benefit to the citizens of the city and county
for each economic development project. Consider the economic impact from job creation in our
community and the income and benefits those jobs provide. Also consider the city and county's
tax base and the impact on supplier businesses from the multiplier effect of manufacturing jobs.
Ms. Renfro stated that it is particularly significant to see a home grown company that started
in 1983 in Asheboro grow to be a world class global operation. The City of Asheboro and
Randolph County's support for this company's growth directly impacts their decision to invest
and create new career opportunities in the US and in Asheboro North Carolina. The Randolph
County EDC sees this request as an investment, rather than an expense. Your support of wealth
creation activities through the location and expansion of manufacturing companies supports a
strong local economy, a growing tax base that helps to keep tax rates low for all and quality job
opportunities for our citizens. Technimark is currently the fourth largest employer in Randolph
County and the City of Asheboro and fourth largest taxpayer for the County and third for the
City.
Fred Richey, Vice President of Corporate Development at Technimark LLC, spoke in favor
of the incentives and thanked the Boards for their continued support through incentives. Mr.
Richey said that incentives are important to them because it is very expensive to get a new
facility started. The cost of initial infrastructure during the first few years leaves very little
revenue to cover other expenses.
He said he had traveled over 1000 miles in the mid-Atlantic and Midwest looking at other
facilities, so this has been a competitive project. He asked the Boards to consider the request for
the incentives package to allow for the expansion in Asheboro.
Janet Pate, 3901 Hillsdale Park Dr., Sophia, stated from what she understood that the
company that bought Technimark is worth billions of dollars. She asked why Randolph County
is giving money away to large corporations who have the money to pay for projects themselves.
Hearing no further comments, Chairman Holmes and Mayor Smith requested motions from
their respective boards.
Adoption of Resolution Approving Incentive Request for Technimark LLC
On motion of Kemp, seconded by Lanier, the Board voted unanimously to adopt a resolution
to enter into an economic incentives contract with Technimark LLC and the City of Asheboro
and to authorize legal staff to draft a contract and to authorize the Chairman to sign the
contract, as follows:
RESOL UMON A UTHORIZING THE COUNTY OF RANDOLPH TO ENTER INTO AN
ECONOMIC DEVELOPMENT INCENTIVES CONTRACT
WHEREAS, Section 158-7.1 of the North Carolina General Statutes authorizes a county to
undertake an economic development project by extending assistance to a company in order to
cause the company to locate or expand its operations within the county; and
WHEREAS, the Board of Commissioners of Randolph County has held a public hearing to
consider whether to participate in an economic development project that will result in the County
of Randolph (the "County'), the City of Asheboro (the "City'), and Technimark, LLC (the
"Company') approving an economic development incentives package whereby the County and the
City each contribute up to five hundred thousand dollars ($500, 000.00) for a total payment of up
to one million dollars ($1, 000, 000.00) to the Company to offset the costs of the Company's
expansion in the City of Asheboro, Randolph County, North Carolina, said incentives to be
granted pursuant to an economic development incentives contract entered into pursuant to Section
2 of this resolution; and
WHEREAS, upon the completion by the Company of this expansion project, the Company
will have generated new value/investment in real and personal property and equipment associated
with the project in an amount equal to or in excess of forty-six million dollars ($46, 000, 000.00), a
minimum of six million dollars ($6, 000, 000.00) of said investment to be made in new value in real
property, and created a minimum of two hundred twenty-four (224) new full-time jobs in the
County and City; and
WHEREAS, this economic development project will stimulate and stabilize the local
economy, promote business in the County and City, and result in the creation of a significant
number ofjobs in the County and City; and
WHEREAS, the County has in its General Fund available revenues sufficient to fund this
economic development project;
NOW, THEREFORE, BE IT RESOLVED by the Board of Commissioners of Randolph
County, this 6th day of October, 2014, as follows:
Section 1. The County is authorized to expend up to five hundred thousand dollars
($500, 000.00) of County funds for the Technimark economic development project.
Section 2. In addition to the standard terms found in contracts that the County routinely
executes in the ordinary course of business, the economic development incentives contract entered
into by and between the County, the City, and the Company must contain the following essential
terms and conditions:
a. The total payment made to the "Company" under this contract shall not exceed one
million dollars ($1, 000, 000.00).
b. Fifty percent of the contract amount will be paid by the County, and the other fifty -
percent of the contract amount will be paid by the City.
c. The contract amount will be paid in six (6) installments in amounts as detailed below at a
frequency not to exceed one installment per fiscal year (July 1 -June 30). The initial
installment payment shall be made no sooner than January 1, 2015, and the final
installment payment shall not be made later than December 31, 2022. The obligation of
the County to make any installment payments specified herein shall be conditioned upon
the satisfactory completion by the Company of certain performance requirements. Along
with investments by the Company itself, these performance requirements may be satisfied
with investments in real and personal property for which legal title is held by the
Company's related business entities and customers so long as such property is part of the
expansion of operations contemplated by the economic development project that gave
rise to the proposed contract and so long as any and all such real and personal property
is domiciled within the City of Asheboro, Randolph County, North Carolina. The said
performance requirements include, but are not limited to, the following:
The Company must deliver to the County and the City written certification that the
actual value of new investment by the Company in real and personal property in
connection with this project equals or exceeds eleven million and no/100 dollars
($11,000,000.00). The written certification of the actual value of the new
investment shall further certify that said new investment is located within the
corporate limits of the City of Asheboro. Additionally, the Company must provide
Employment Security Reports to the County and the City evidencing the creation
of eighty-eight (88) new full-time jobs. Upon receipt of said certifications, the
County and the City shall remit a total payment of one hundred sixty thousand
and no/100 dollars ($160, 000.00), fifty percent to be paid by the County and fifty -
percent to be paid by the City; and
ii. The Company must deliver to the County and the City written certification that the
actual cumulative value of the new investment by the Company in real and
personal property in connection with this project equals or exceeds eighteen
million and no/100 dollars ($18,000,000.00). This written certification of the
actual cumulative value of the new investment shall further certify that said new
investment is located within the corporate limits of the City of Asheboro.
Additionally, the Company must provide Employment Security Reports to the
County and the City evidencing the creation of an additional thirty-six (36) new
full-time jobs. Additionally, the Company must deliver to the County and the City
written certification that the Company has not reduced its level of operations in
the County and the City since the date of payment by the County and the City of
the immediately preceding installment payment. By way of illustration and
without limitation, the Company shall be deemed to have reduced its level of
operations in the County and the City if the Company fails to maintain the entirety
of newly created jobs referenced in Paragraph (i) above. Upon receipt of the
required certifications, the County and the City shall remit a total payment of one
hundred sixty thousand and no/100 dollars ($160,000.00), fifty percent to be paid
by the County and fiftypercent to be paid by the City; and
iii. The Company must deliver to the County and the City written certification that the
actual cumulative value of the new investment by the Company in real and
personal property in connection with this project equals or exceeds twenty-five
million and no/100 dollars ($25,000,000.00). This written certification of the
actual cumulative value of the new investment shall further certify that said new
investment is located within the corporate limits of the City of Asheboro.
Additionally, the Company must provide Employment Security Reports to the
County and the City evidencing the creation of an additional thirty-seven (37) new
full-time jobs. Additionally, the Company must deliver to the County and the City
written certification that the Company has not reduced its level of operations in
the County and the City since the date of payment by the County and the City of
the installment payment referenced in Paragraph (ii) above. Upon receipt of the
required certification, the County and the City shall remit a total payment of one
hundred sixty thousand and no/100 dollars ($160,000.00), fifty percent to be paid
by the County and fiftypercent to be paid by the City.
iv. The Company must deliver to the County and the City written certification that the
actual cumulative value of the new investment by the Company in real and
personal property in connection with this project equals or exceeds thirty-two
million and no/100 dollars ($32,000,000.00). This written certification of the
actual cumulative value of the new investment shall further certify that said new
investment is located within the corporate limits of the City of Asheboro.
Additionally, the Company must provide Employment Security Reports to the
County and the City evidencing the creation of an additional thirty-two (32) new
full-time jobs. Additionally, the Company must deliver to the County and the City
written certification that the Company has not reduced its level of operations in
the County and the City since the date of payment by the County and the City of
the installment payment referenced in Paragraph (iii) above. Upon receipt of the
required certification, the County and the City shall remit a total payment of one
hundred sixty thousand and no/100 dollars ($160,000.00), fifty percent to be paid
by the County and fiftypercent to be paid by the City.
The Company must deliver to the County and the City written certification that the
actual cumulative value of the new investment by the Company in real and
personal property in connection with this project equals or exceeds thirty-nine
million and no/100 dollars ($39,000,000.00). This written certification of the
actual cumulative value of the new investment shall further certify that said new
investment is located within the corporate limits of the City of Asheboro.
Additionally, the Company must provide Employment Security Reports to the
County and the City evidencing the creation of an additional thirty-one (31) new
full-time jobs. Additionally, the Company must deliver to the County and the City
written certification that the Company has not reduced its level of operations in
the County and the City since the date of payment by the County and the City of
the installment payment referenced in Paragraph (iv) above. Upon receipt of the
required certification, the County and the City shall remit a total payment of one
hundred sixty thousand and no/100 dollars ($160,000.00), fifty percent to be paid
by the County and fiftypercent to be paid by the City.
vi. The Company must deliver to the County and the City written certification that the
actual cumulative value of the new investment by the Company in real and
personal property in connection with this project equals or exceeds forty-six
million and no/100 dollars ($46,000,000.00). This written certification of the
actual cumulative value of the new investment shall further certify that said new
investment is located within the corporate limits of the City of Asheboro. The
Company must also deliver to the County and the City written certification that
the Company has not reduced its level of operations in the County and the City
since the date of payment by the County and the City of the installment payment
referenced in Paragraph (v) above. Upon receipt of the required certification, the
County and the City shall remit a total payment of two hundred thousand and
no/100 dollars ($200, 000.00), fifty -percent to be paid by the County and fifty -
percent to be paid by the City.
d. The contract must provide the County and the City with a means of recouping a portion
of the contract amount if the Company's facilities, as expanded, do not remain in full
operation, maintaining the newly created jobs referenced above, for a period of six (6)
years immediately following the date on which the final installment of the contract
amount is paid to the Company.
e. If the Company does not remain in full operation during this six (6) year period, a
portion of the incentive money must be returned. The amount to be returned shall
decrease on a pro -rated amount for each year that the company remains in the City and
County. Any amounts returned by the company in this manner shall be divided equally
between the County and the City.
Section 3. The Chairman of the Randolph County Board of Commissioners is hereby
authorized to execute on behalf of the County of Randolph a contract drafted in accordance with
Section 2 of this resolution and any other documents necessary for the implementation of this
economic development project.
Commissioner Frye responded to the comments by stating that the incentives are a net benefit
to the taxpayers of Randolph County and the City of Asheboro. When considering incentives
they look at jobs. This project brings 225 new jobs for people in this county who will use their
wages and reinvest it back in this community, by paying sales tax every time they spend those
dollars. He stated that it has been his experience that the families of this county would rather be
on a payroll than live on a welfare check and dependent on the government to take care of them.
Randolph County has one of the lowest unemployment rates and has for several months. He said
if you think incentives are expensive then compare that to the costs that would have to be paid by
the government for all the services and public support that they can get if they don't have jobs.
Commissioner Frye said he didn't particularly like incentives and Randolph County didn't start
the business of incentives, but it has become a process in which they have to go through in order
to get and keep jobs locally.
City of Asheboro Approval of Incentive Request
The City of Asheboro also voted unanimously to approve the incentive request.
City of Asheboro Adjournment
The Asheboro City Council adjourned.
County Adjournment
At 6:20 p.m., the Board of Commissioners adjourned.
J Harold Holmes, Chairman
Phil Kemp
Stan Haywood
Darrell L. Frye
Arnold Lanier
Amanda Varner, Clerk to the Board