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June 12, 2001
<br />
<br />Recommendation:
<br />
<br />· Adoption of a resolution approving the issuance of not to exceed $25,000,000 of the
<br />City of Norfolk Empowerment Zone Facility Revenue Bonds for Metro Machine
<br />Corporation and/or Speede Shipyard, LLC to pay a portion of the costs of the
<br />acquisition, renovation and equipping of an existing repair facility to establish a
<br />merchant ship repair facility on approximately 7.74 acres of land at 200 Ligon Street in
<br />the City of Norfolk.
<br />
<br />Purpose and Need:
<br />
<br />· On February 22, 2001, the Norfolk Industrial Development Authority adopted a
<br />resolution of intent approving the issuance of not to exceed $25,000,000 in
<br />Empowerment Zone Facility Revenue Bonds for Metro Machine Corporation and/or
<br />Speede Shipyard, LLC to acquire, renovate, and equip a merchant ship repair facility.
<br />The Norfolk City Council adopted a resolution approving the issuance of the bonds at a
<br />meeting dated May 8, 2001.
<br />
<br />· The Empowerment Zone covers a 10 square mile area of the cities of Norfolk and
<br />Portsmouth, Virginia under Section 1391(g) of the Internal Revenue Code of 1986.
<br />According to IRS regulations, the Portsmouth City Council must approve the bonds no
<br />later than June 16, 2001.
<br />
<br />Financial Impact:
<br />
<br />· According to the "Fiscal Impact Statement Submitted to the Industrial Development
<br />Authority of the City of Norfolk" (attached), the estimated dollar impact per year of goods
<br />and services to the Hampton Roads area will be $5,000,000.
<br />
<br />· This project, located in Norfolk, will provide 185 year-round jobs with an average
<br />salary of $27,000 per employee.
<br />
<br />· With this approval, the City of Norfolk will have issued $29.5 million in empowerment
<br />zone bonds, and the City of Portsmouth has issued $8 million. Out of the total of $130
<br />million in bonds allocated to this Empowerment Zone, each city has been allocated $50
<br />million in bonds, with the remaining $30 million to be held for future allocation.
<br />
<br /> Motion by Mr. Robinett, and seconded by Mr. Griffin, to adopt the following
<br />resolution, and was adopted by the following vote:
<br />
<br />"A RESOLUTION APPROVING THE EXERCISE BY THE INDUSTRIAL
<br />DEVELOPMENT AUTHORITY OF THE CITY OF NORFOLK OF POWERS
<br />CONFERRED BY THE INDUSTRIAL DEVELOPMENT AND REVENUE BOND ACT
<br />AND ORDINANCES 26,565 AND 27,524 OF THE CITY OF NORFOLK IN
<br />CONJUNCTION WITH THE ISSUANCE FOR METRO MACHINE CORP., A VIRGINIA
<br />CORPORATION, AND/OR SPEEDE SHIPYARD, L.L.C., A VIRGINIA LIMITED
<br />LIABILITY COMPANY, OF NOT TO EXCEED $25,000,000 OF THE AUTHORITY'S
<br />EMPOWERMENT ZONE FACILITY REVENUE BONDS TO PAY A PORTION OF THE
<br />COSTS OF (1) THE ACQUISITION, RENOVATION AND EQUIPPING OF AN
<br />EXISTING REPAIR FACILITY TO ESTABLISH A MERCHANT SHIP REPAIR
<br />FACILITY ON APPROXIMATELY 7.74 ACRES OF LAND AT 200 LIGON STREET, IN
<br />THE CITY OF NORFOLK AND (2) THE ISSUANCE OF SAID BONDS.
<br />
<br /> WHEREAS, the Industrial Development and Revenue Bond Act, Chapter 49,
<br />Title 15.2 of the Code of Virginia, as amended, authorizes the creation of the Industrial
<br />Development Authority of the City of Norfolk (the "Authority") and the Council of the City
<br />of Norfolk created the Authority by adoption of Ordinances 26,565 and 27,524
<br />(collectively, the "Act"), and the Act empowers the Authority to assist Metro Machine
<br />Corp., a Virginia corporation, and Speede Shipyard, L.L.C., a Virginia limited liability
<br />company (collectively, the "Applicant"), by the issuance of its empowerment zone facility
<br />revenue bonds (the "Bonds") to pay a portion of the costs of (1) the acquisition,
<br />renovation and equipping of an existing ship repair facility to establish a merchant ship
<br />repair facility on approximately 7.74 acres of land at 200 Ligon Street, in the City of
<br />Norfolk and (2) issuing such Bonds; and
<br />
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