- Real Estate
- Paris Flash
Tuesday, the Paris City Council agreed to pick up funding for the business incubator and some form of retail marketing in its upcoming budget.
The budget hasn’t been officially adopted yet, but council members voiced their support for both measures during Tuesday’s special session.
Mayor AJ Hashmi, councilman for District 7, proposed several conditions for the Red River Region Business Incubator to get the money. There needs to be a formal contract between the city and incubator that would delineate the benefit to the city, plus quarterly reports from R3bi. He also suggested the city pay the $89,000 throughout nine months.
“At that point, after nine months, the incubator should be self sufficient or find some other means for funding,” he said.
To settle the matter for the incubator’s sake, the mayor said he didn’t want to draw it out with extended debates.
Interim City Manager Gene Anderson asked whether the City Council wanted to require an outside audit of the incubator as part of the funding. Hashmi said it would be a good idea but wasn’t sure it should be required, and District 1 Councilman Aaron Jenkins said “no.” District 5 Councilman Matt Frierson pointed out it’s only a nine-month agreement and then the city is done with it. The rest of the council indicated support for an audit.
District 4 Councilman Richard Grossnickle asked that the council also consider funding Retail Attractions since Paris Economic Development Corp. was directed to remove that $33,000 line item from the budget along with the incubator. Rickey Hayes‘ firm has spent the last few years marketing Paris to retail developers and is reportedly in the middle of a major deal.
Cutting that agreement short would be a mistake, Frierson said.
“Retail Attractions through the end of June has made 395 activities on behalf of Paris,” he said. “It’s not just retail. It’s real estate and expansion.”
Although his main concern was that the funding remain somewhere, Frierson said the most natural place for it would be the PEDC budget. The council does not have the prerogative of sticking something back in that budget, Hashmi said. He said it was a matter for the board.
“The budget that was presented met the guidelines,” Frierson said. “There has been some speculation to the contrary, but there hasn’t been any facts presented.”
Those guidelines are set in state law, which says a Type A corporation can spend up to 10 percent of its revenue on promotional activities. For PEDC, that comes to $120,000. PEDC Director Steve Gilbert has maintained the organization has stayed within those limits, including the contract with Retail Attractions. PEDC board Chair Rebecca Clifford has suggested a closer look shows the EDC has spent a great deal more than that.
“It’s their responsibility to determine whether it’s in their 10 percent or not,” Hashmi said. “I’m not going to dispute that. I’m not EDC.”
He said a more detailed budget than that Paris Economic Development Corp. usually submits may help answer those questions.
“Can we have it written down that this is marketing and what it’s being spent for?” he said. “That is where concern comes, and that is where debate starts.”
If the city moves forward with some kind of retail marketing, the mayor said, it should be opened to bids and not just given to Retail Attractions just because the firm had the contract before. The other council members supported that idea.
Hashmi said he had a problem with paying a consultant every month for simply promoting the city. It should be done more like a real estate agent and paid a commission for bringing a project to Paris, he said.
Frierson pointed out that unlike Retail Attractions’ fixed price, that approach could wind up costing quite a bit more in commissions.
“We may hit the lottery and get a large development, but you’d better be ready to pay for it,” he said.
The council will need to figure out where the funding would come from, whether that’s from cutting other expenses or taking it out of reserves, Anderson said.
By Jeff Parish, eParisExtra