Oh, she is access resources.

All right, you ready, Clerk?

Uh was that?

All right, I will call this meeting of transportation and mobility to order.

Clerk, could you please call the role?

Present.

Thank you.

If uh the assistant director, if you'd like to come forward.

So there, if you the members refer to their tablets, there are two pieces that port control is bringing for introduction and passage in July.

Uh, they are still unnumbered, uh, but since we are here, I thought it'd be worthwhile for us to discuss them.

Uh so the first thing I'd like to uh discuss if you open the legislative summary, which are on your tablets, uh, it's I'll just read the executive summary.

It's a little different than the title of an ordinance, uh, but it's this is for a two B numbered ordinance.

This is the Department of Port Control requesting the authority to purchase by one or more standard purchase contracts up to twelve passenger boarding bridges, including but not limited to removal and disposal of existing passenger bridges, an installation for Cleveland Hopkins International Airport.

Uh, this is an anticipated cost of uh twenty six million dollars.

Uh Assistant Director, would you like to well, first of all, welcome?

And uh just not opportunity to discuss these so that we can maybe lighten the load a little bit on July thirteenth.

Absolutely.

Uh thank you, Chairman.

Uh, to the uh chair and this body, I appreciate the opportunity to be with you today.

Uh, the passenger uh boarding bridge project is a project to replace twelve uh passenger bridges, uh boarding bridges four in concourse A, two in concourse B and six in Concourse C.

Uh, we are currently in the design process of a design built contract with Arrow Bridge for nine passenger uh boarding bridges, seven in concourse A and two and Concourse C.

This project will likewise be a design built contract.

Uh it's also the second group of boarding bridges being replaced.

The first group is currently in the design process.

Uh, first group is gates A one, five, seven, nine, eleven, twelve, and fourteen, and also gates C two and four.

Uh the second group of bridges are gates A2, 6, 8, and 10, gates B3 and 7, and gates C3, 5, 6, 7, 9, and 11.

Uh again, as you mentioned, the uh estimated uh project cost is 26 million.

Uh typically it's about uh two million per bridge uh based on the average costs of uh the ones we've done in the past, and we did uh also include a 10% escalator uh factor.

Uh bridges are being designed to be reused if new concourses are uh constructed so that if uh if there's a need to uh move them to uh support uh other uh gates, uh we can do that.

And uh again, the force the funding sources are PFC and FAA.

Okay.

Uh does anyone in the committee have questions about purchasing new passenger boarding bridges?

Councilman Casey.

Thank you, Mr.

Chairman.

Mr.

Chairman to the assistant director.

Yes, sir.

Um correct me if I'm wrong, but the passenger boarding bridge is once you check your ticket at the gate, right?

It's that the walkway that you get to get into the plane, correct?

To the to through the chair to the council member, that's correct.

All right, and these uh boarding bridges are going to be equipped to handle the the new terminal.

That's correct.

That's correct.

Uh they are being built to be able to uh you be utilized before, but also to be capped on uh for the TMD project.

And is a is a bridge to the chairman to the assistant director.

Is a bridge a bridge?

Uh are there different ones?

I no, actually uh there are different uh styles as it relates to the type of plane that you are connecting to.

Uh some of them are uh uh more akin to be able to connect to larger planes or and some even for uh double passenger uh entry and exit uh if necessary.

So there are some uh there are some similarities as far as uh uh design, but there are some uh uh nuances to them that can make them uh a little different per uh usage.

All right, and then ms last question, Mr.

Chairman, the assistant director.

All the passenger bridges are owned by Cleveland Hopkins.

Uh that I would have to confirm uh, but I do believe so.

Okay, and then but the FA's funding.

Funding them, right?

Okay, thank you.

Thank you.

Are there any other questions on passenger bridges?

Councilman Palence.

I just Mr.

Chairman, my honorable colleagues had a question.

The I I guess you want to refer to as the Concourse.

What is the concourse that has been um abandoned or emptied?

Uh to the council uh member through the chair, that's concourse D.

D.

D.

Is there anything in there at all?

Uh there's still a lot of uh some older equipment and things that were abandoned, but uh as far as I know the last time I I was in there, uh it's pretty much pillaged.

So but it but we we're still providing utilities in there, correct?

That is correct.

And we have to maintain it.

That's correct.

Okay.

Is that still I I do believe that's coming up soon uh as it relates to that united uh project, uh but I'm not uh too familiar with it.

Was that uh Mr.

Chairman uh to the to Frank?

Was that Continental?

Was that a continental?

I believe that was the uh hub there or or united, one of the so they still paying us for that for that concourse D?

Uh that that would be uh a question maybe before the uh revenue folk.

I'm I'm over the operation request to the chair if you could write that to us.

Sure.

Thank you.

I can get that to you before the end of the day.

Yeah, and I am pretty confident that the lease that would united inherited the continental lease for D, they are still paying, so it's uh it's empty, but it's not cost.

I that last I knew that was the arrangement, but if staff, if we could make sure to make a note to confirm that, uh that would be useful.

Uh any other questions on passenger boarding bridges.

Uh councilman Jones, then councilman Bishop.

Thank you, Mr.

Chairman.

Um the estimated cost right now would be 26 million, is that correct, Mr.

Chairman, to the director?

Through through the chair to the council member, yes, that's correct.

All right.

And Mr.

Chairman, um the just to make sure I'm on the same page.

So this is just for the scope of services uh for uh uh uh replacing the bridges you have right now.

And and these bridges have been over 30 years old?

Through the chair to the council member, yes, uh at least for the years.

And so then how many bridges, if I may ask, do we have total for for uh I'm I I'm not exactly sure uh of the count because I think we do have a couple more than we have for gates, you know, for uh a spare and spare parts, uh, but uh I can get that number for you uh to confirm.

No worries.

Uh Mr.

Chairman, I have no uneasiness.

And the the 26 million is coming from the federal government, correct?

That's correct, and PFC uh or passenger facility charges.

And how did it come about?

Just did you saw a need and you went to the airport or was this a part of a grant system?

Uh a little bit of both.

Uh one of the things that uh really comes to account is uh the passenger experience can really be uh uh negatively influenced when uh passenger boarding bridges are very hot uh and don't have the circulation or uh situations where uh some of them may leak in the rain and things like that where people are getting on the planes.

Uh so we wanted to really make sure that we are working on uh not waiting until the TMDP project, but making sure that we increase uh passenger uh uh uh care uh before that happens.

I see.

No further questions, Mr.

Chairman.

Uh thank you and Councilman Bishop.

I love that jacket, sir.

Thank you.

Thank you, thank you, Director.

Thank you, uh Mr.

Chairman.

Uh Ms.

Chairman, so to the director, we we bought a few um bridges a few years back through this committee.

I remember we had a couple bridges a couple years back.

Is that correct?

That's correct.

Uh this is the second phase of of those replacements.

Uh we're still uh in the process of uh installing and uh finishing up that design build.

Uh now this would be the second uh phase of those.

So the basically the airlines picks up the cost of the bridges, or you said it was a transportation board or something?

Correct.

Uh FAA and also PFC funds uh support these uh okay.

So the the dollar amount we saw we see here in the uh executive summary is not the support the city will have to pay, is that correct?

That's correct.

This is this is not a charge to the city.

Okay.

Mr.

Chairman, the this this will not go forward, Mr.

Chairman, correct?

This is not going forward today, right?

No, this is being introduced in uh July.

I figured we since they are anticipating it coming, I figured we could discuss it today uh just since since we're a meeting.

But there is nothing that we are not voting on this today for recommendation.

And so did you say through the chairman, did you say the bridges cost about two million each?

That's correct.

Uh through chair, I'm sorry.

Uh to the council member, yes, that's correct.

About approximately two million.

Okay.

All right.

If you can just get us the um the amount of bridges that we have, the amount of bridges that we need, and then just to give us the amount of bridges that we are looking to replace over the next couple couple years.

Okay.

Thank you, Mr.

Chair.

Uh thank you.

And Councilwoman Gray.

Thank you.

Thank you.

Uh Director.

Assistant director.

Assistant director, yes.

Um, just a question about uh uh the background uh proposed.

Um it says here that um by one or more standard purchase contracts, 12 passenger boarding bridges including but not limited to installation removal and disposal uh per se.

Uh so uh so when the um installation process will start, uh how will that work with uh we moving the passenger boarding bridges as we go into the airport?

You talking about that bridge when you scan your ticket and that's that little bridge you go into the plane.

Is that the one you're talking about?

Through the chair to the council member, yes, that that is uh those are the bridges that we are uh discussing.

Uh and and one of the things it's worded that way so that if there's opportunities for us to save funds by doing some of the work internally, uh that way we can do those and not have issue with the actual contract.

Uh for example, if that the removal or uh some of those uh ancillary portions of uh the project again if we can do some things in house, we're gonna try to do those to uh keep the cost reasonable.

Okay, interesting answer.

And chair too, this is the director.

Uh since you says there's 12 passenger boarding uh boarding bridges.

Uh do you have any idea how that uh per bridge going to be uh uh removed or disposed at that particular time doing the service of people traveling, Chair to the assistant director?

Thro th through the chair to the council member.

Yes, uh what would what will be done as we go through this design uh bill project?

Uh they will also take a look at uh c accommodating all of the airlines as far as scheduling and things of that sort to make sure that it's seamless and it doesn't interrupt uh passenger uh travel, but at the same time we're going to push to make sure uh that we do things in a safe manner because that's gonna be the real key is making sure to uh do those things uh in a safe manner to make sure that everything is safe and done in a way that it doesn't impact uh traffic negatively.

Okay, all right.

And one last question, you probably even even answered this already.

What is the time frame?

You know, when would this start, Chair?

To the assistant director.

Uh the project will will start uh fairly quickly as it relates to the design, but uh it's a little early to say when uh actual installation will uh come into play because of course winter and those things at construction season also play a part in those uh decisions and planning.

Thank you, Chair.

Thank you.

Um hearing no other questions.

I have heard uh tales of deep planings being delayed due to uh problems with jet bridges.

So I think it is uh in everyone's interest to make sure that we're not relying on 30 old bridges.

Uh again, we are this has not been introduced yet, so we are just discussing this today.

Uh we will uh vote formally on it in July.

Uh I'm gonna move on to uh another piece that is also being introduced in July.

Um the executive summaries on your tablet.

Uh, this is the Department of Port Control requesting authority to enter into one or more requirement contracts with Siemens Industry Inc.

for labor and materials necessary to maintain repair, upgrade, and expand the existing apogee building automation system for a period of one year with three one year options for renewal exercisable by the director of port control, assistant director.

If you could remind the committee, as is protocol, what an appogee building automation system is.

Thank you to through the chair to the council members.

Uh this scope of work, the contract will provide software labor and the materials necessary to maintain repair, upgrade, and and expand the existing building automation system for the operation of the Department of Port Control.

Uh, in layman's terms, what these uh systems are are the alarms and uh automation systems uh to let building maintenance know when there's an issue throughout the campus of uh especially in the concourses.

Uh for example, uh if there is a smoke alarm, these are the alarms that would go to our uh fire uh uh uh staff or also a flood, things of that sort where we will know where those things are and how to dispatch uh to uh respond to those things.

Uh without uh that automation, it it becomes a manual process to where we're really running around trying to find things.

Uh for example, if there's a leak or something in throughout the building, uh we're trying to manually find those things.

So this automation system, uh, while somewhat prior uh proprietary, uh, is our approach to make sure that we can uh maintain the facility with uh with when there are issues, uh, but also maintain the facility with to mitigate as much damage as possible uh when anything does happen.

Uh right now we are in flux a little bit to to the point where uh we get a lot of false alarms and things of that sort, and we want to make sure that uh we manage this system uh now so that we can uh decrease uh false alarms and call-outs and things of that sort that uh don't uh uh amount to an actual issue.

Uh I'll give a great example is uh vaping in the restrooms has become a really big issue, uh, but it causes us to uh when those alarms go off, it causes a whole uh RF uh dispatch run, uh which means that folks are getting in trucks, getting suited up, coming to fight a fire, only to find out that it was uh just someone vaping in the restroom.

Uh so we're working to uh really get those systems automated.

Uh we've had a lot of issues, especially in the winter with floods or pipes bursting and things of that sort, and trying to find those locations when uh it they don't report back uh correctly uh a lot of those damages uh tend to exasperate, and we want to really maintain these systems going forward.

Okay, thank you.

I have been present when someone has set off the fire alarm for vaping in the bathroom.

Uh stop doing that, people.

This isn't middle school.

Stop smoking in the bathroom.

Uh are there any questions on the app OG building automation system?

Councilman Casey.

Well, you should have a smoking room in the terminal.

Right.

Um I'll take that back.

Yeah, honest to God.

For those who are nicotine affected, there's nothing worse than having a three-hour layover and not being able to get your fix on.

And I'd rather see a smoking room than ARPA or RP.

Monetize that.

Some something, right?

Um through the chair to the council member, that is uh something across the country.

There are areas that do monetize those uh items.

And I've been to airports where they do have them.

Yeah.

Open up Concourse D, right?

Mr.

Chairman of the Assistant Director, what's the name of this company?

Uh the company that we are working with is Siemens.

All right, and where are they located?

Uh I do believe they are a how Ohio-based company.

I can get that information for you.

So you don't you don't know where they're located?

Are they a Cleveland company?

They are.

I do believe they are Ohio Ohio company.

I'm not exactly sure if they're in the Cleveland proper.

So that would make them a Cleveland Ohio company, though.

I mean, they're if you're Ohio, you're through through the chair to the council member, whatever you say.

Through the chair to the council member, whatever you say.

How long, Mr.

Chairman of the Assistant Director, how long have they been they've been contracting with port control?

Through the chair to the council member.

For several years, it's my understanding.

And Mr.

Chairman, to the to the assistant director, is this a proprietary contract?

Is this their equipment?

Through the chair, no, it is it is not their equipment, but it is somewhat proprietary because some of our systems are legacy and older and not supported by some of the new things.

And again, that's why we're kind of going at it this way to maintain while we uh move forward, but also look at other options as we move closer to the TMDP.

All right, and Mr.

Chairman to the assistant director mail, final question is why didn't we go out for RFP on this?

Through through the chair to the council member, uh this was uh chosen to go this route because of the proprietary issues that we uh do uh uh uh face right now, but our goal is in the future as we uh get better at this uh to to go out for RFP.

That's why it's uh with the one year uh uh uh renewals.

Right, but Mr.

Chairman to the or assistant uh Mr.

Chairman to the assistant director, if this equipment is not proprietary, right?

It's not theirs, it's just old.

Uh we won't know if another company can handle it if we don't go out for RFP, correct?

Through the chair, it's my understanding that this was uh cycled before in the past uh and and why we came to uh this uh uh conclusion uh for because of uh RFPs that went out in the past and uh the responses from them.

When was the last time we went out for RFP?

I could get that information, but I do believe uh two years ago.

All right, thank you, Mr.

Chairman.

Uh thank you.

Are there any other questions?

Councilman Jones.

Just on that same line of questions, Mr.

Chairman.

Um what are we talking about is more or less the equipment that is uh concerning because you're doing a number of things here, correct?

Through Chair, I'm sorry, I didn't understand.

With this scope of services we have in front of us, right?

So you're you're talking about they're going to provide software, labor, materials necessary to maintain, repair, upgrade, and expand the existing building automation system.

So is it the automated automated system that we're talking about that is considered proprietary?

Uh through the chair, uh not quite.

Uh what it is is uh some of those uh pieces are legacy, uh especially considering HVAC, lighting, uh plumbing, uh uh all those types of uh systems, they're all different, so they all have different nuances to them uh for us to be able to maintain in-house, we need that uh support uh from this service.

But again, uh it's our goal to continue to uh hone in on those things as we move forward uh with the TMDP uh to uh make sure that we uh are open to uh not only uh other uh uh agencies but also open to be able to keep up with technology and automation systems as they uh continue to mature.

And then you know, uh just again on that same line of questioning too, is because one of the things that's really important to me sitting here is that we give out a lot of work, a lot of resources, we give out millions and billions of dollars to companies and corporations that do business with us here at the airport.

And um one of the things sitting here in years past was lobbying to make sure that you know, when we are giving out these contracts, that we're looking at the citizens who live in the city of Cleveland.

Businesses that are in the city of Cleveland and businesses that do business with the city, we should be, you know, if they qualify, we should be rewarding them.

Uh one of the things I think is really significantly important is we need to put our money where our people live.

So if they live in the city of Cleveland, their business is in the city of Cleveland, we should be supporting that.

And and it would be nice to know exactly where this organization uh where they are.

So if you could send that to us, that'd be great.

And uh through the chair, to your uh very point, one of the things that we also work on on that very same lines is uh as we move forward with these types of projects and things of that sort, we look to uh possibly onboard some of those staff that actually have been working on our systems uh longer term, especially when they are uh city residents and things of that sort to develop that relationship and uh keep maintaining it throughout uh the legacy of those pieces of equipment or uh items throughout the airport.

Okay.

Thank you, Mr.

Chairman to the director.

Thank you.

Councilwoman Greg.

Yes, hi, thank you, Chair.

Uh, this ordinance as chair spoke is to be determined as uh you know with a number and or this is just a uh a preliminary of questions.

Correct.

So that since it hasn't been introduced yet, it hasn't been assigned a number yet.

Uh but the anticipation is that it will be introduced in July, and that uh uh it would could be up for passage.

Okay.

So I wanted to discuss it today since we're meeting since committee the whole becomes so so elongated.

I figured this would be an efficient use of time to maybe make that time shorter.

That's just smart choice.

Yeah.

So uh the assistant director, I just have a quick couple questions.

This um this new uh company is Brunell Siemens.

That's correct.

Okay, um, do they have a subcompany in Cleveland?

Because I just Googled, and they are located in Georgia.

Alpha Alphagraddy, Georgia.

So do they have a subcompany here in Cleveland as partner for uh for uh you for the Porter control to select this company due to the um service that they can provide for what um this uh ordinance is required?

Through through the chair to the assistant director.

Thank you for that.

Uh through the chair to the council uh member.

Uh what what they do is they have uh different uh locations throughout the country uh that services different regions.

Uh their home office is uh I think you mentioned in Georgia, uh but uh they have uh uh on-site uh for example, most of the areas or or the especially airports that they service, uh they actually have a group that actually are on the ground in that area.

So, for example, uh with Siemens right now, we can call them, and they they are actually contracted to be with on site within 24 hours uh or less.

So they actually have uh staff on site.

They're not an actual sub, but they are actually part of the company that has locations uh all across the country that service uh the areas that they are contracted with.

Okay, thank you for that.

So are they going to be a new company or Porter Troll have always worked with this uh industry?

Through the chair uh to the council member.

This has been a uh relationship that uh has gone off for a couple of years successfully.

Uh but again, we are not uh trying to uh tie ourselves to one vendor.

Uh so that's why we do this as the uh one year uh uh renewals uh so that we are always able to be nimble enough to find the best uh and the brightest uh for our port control.

Okay, all right.

Thank you, Chair.

Thank you, Councilmember.

Thank you, Councilwoman.

Are there any other questions?

All right, hearing none, there's no action to take today.

This will be up for introduction and uh passage in July.

Thank you for your time, Assistant Director.

Uh, with that, we will turn over to the real thank you.

Councilman Jones, do you mind passing me that ordinance?

Thank you.

Um we will turn over if the team wants to assemble.

Uh this is a piece that we discussed and was held at our committee of the whole earlier this month, and uh recognizing the complexities associated with the uh settlement agreement between the cities of Brook Park and Cleveland that dates back um over 25 nearly 25 years.

Um I felt it would be useful to have a more in-depth conversation about it uh today within the committee.

Uh admittedly, since a lot of this involves the ward that I represent, I I probably live and breathe it more than others uh just from the day-to-day workflow.

So I appreciate everybody coming today uh for a summer committee meeting.

Uh I will read the ordinance in and then we can have the team introduce themselves.

But this is ordinance 664 2026 as amended by Mayor Bibb, an emergency ordinance authorizing the mayor and the directors of law and port control to enter into a first amendment to settlement agreement between the cities of Brook Park and Cleveland relating to the International Exposition Center and the Emerald Park Joint Economic Development Zone and establishing a special revenue fund.

Uh Director.

Or Chief.

Great, thank you.

I will refer to our chief of development.

Good afternoon.

Uh thank you, Chairman, for having this hearing and allowing us to provide a little bit more color on what I know is a complicated and consequential issue.

Uh joined here today uh by Joe Rose Bordeaux Small, our director of the Department of Development, uh Mark Griffin, uh, our chief legal officer, uh Jennifer Sheel, who is the executive for business attraction for the city of Cleveland, uh, and Scott Carr with the airport.

Uh I I know we uh have kind of gone through this before, but uh spent some time working with your policy team uh over the course of time, which I believe got you a one-pager on this, and I think uh also added a couple of slides to this presentation because I know it can get uh pretty deep.

Um, but we've also seen it before.

So I'm gonna go through it uh a little bit quickly.

I do I know Miss Sheel has to leave at 1050 uh uh for a meeting that she cannot avoid, and I think it is very important that you uh hear from her directly on on how she views the IX center as an asset.

Um so we can always come back to some of this.

Would it be useful to start with that or is it out of order?

I think that's fine.

Uh we can kind of come back to this, but but uh so I think for that purposes, uh, you know, as we look at the uh IX Center, which we talked a lot about, the building itself, right?

And this asset that we acquired in this deal uh at 2.2 million square feet, uh, you know, with very high healing site heights, the 16 foot thick concrete floors, the overhead bridge cranes, right?

This is literally a building that used to make uh B29 bombers and tanks uh built for heavy industry with a 25 megawatt uh uh uh substation attached to it.

Um, you know, and Miss Sheel has spent quite a bit of time talking to site selectors, um, potential companies that looked at it, and I think it is important to hear from her uh on what she is hearing when she talks to those people and why we think this is such a unique asset for the city.

Thank you.

Um so I'll just start with the features of the building.

Um so you know, this is big and heavy and a lot of square footage, and what that means is that we have an advanced manufacturing facility that's ready to go.

That is very, very um it's a huge competitive advantage, one because right now we've got a lot of venture capital that is going into advanced manufacturing and they need to move quickly, and people are trying to produce as quickly as possible.

Um so one, it's the fact that it's ready to go, two, the fact that it's built with so much of this infrastructure means that um we can have those CNC machines, but also we can make big subsystems, which we as a city um don't make a lot of, right?

We make a lot of components.

We might make some big, you know, turbine gas uh chambers, but we don't make a lot of subsystems.

Um we make all the components that go into all of those things.

Some of the um businesses that I've been talking to can use this right away and plug into our supply chain right away.

It's also the two companies that I've talked to that are interested in this building could use the supply chain and our workforce as is.

We have the workforce, we have the supply chain to support them.

Um this building kept us in the running for one of the most innovative companies um in the United States, um, as rated by fortune.

Uh it's one of two in our state, and it's one of seven in a tri-state area that's ready to go with this infrastructure.

Overhead head bridge cranes are incredibly important, I'm sure all of you know, in order to move things along the assembly line that are very heavy that offloads that need in um the workforce.

The thick concrete floors again means that we can have heavy machineries like a CNC machine in that building.

Um, and the truck docks means that we can deliver those and use that infrastructure that we have the logistical infrastructure right away.

I'm happy to answer any questions.

Given given the time sensitivity she has, I'll entertain if anyone has we'll keep it to five minutes since it's just narrowly about the IC.

But are there any questions the committee has uh specific to the what we just heard from Ms.

Shields?

Uh Councilman Jones and Councilman Planse.

Yes, I just want to qualify uh real quick.

Um I'm sorry, who are you and give me some background, please?

Through the council chair to the council member, I'm Jennifer Sheel.

I'm the executive attraction officer for the city of Cleveland.

So I joined about six months, so about seven months ago in October.

Um, and my you know, entire position is meant to look at um attracting businesses from outside of Ohio to Cleveland.

So I'm not into the poaching game, though, of course, if Columbus wants to give something up, I'll certainly take it.

Um but we are focused on or I am focused on four core industries: biotech, advanced manufacturing underneath that.

We've got polymers and advanced manufacturing with aerospace and defense contracts.

This is prime for that.

Um and then also food and beverage manufacturing.

This is not prime for that.

So you you talked about very briefly, you you stated there's one or two businesses that would be interested in that.

That's correct.

Um we sat here at the table, we've had um discussions to quite some length about the deal that was in front of us.

And when I I had to kind of like woven through it to try to get an idea of what projections, you know, what are we talking about?

Because it wasn't and it's what I asked Mr.

Chairman was if we make this deal, what is our financial projection?

So do we have that?

I don't know.

I requested that.

Uh and the last time we talked, I had to sit here and try to like go through all of it to try to make some sense of what was being said.

So if this happens the way this happens, what are the real financial benefits for the city of Cleveland in your estimations?

Yeah, through the chair to the council member, this is um the one that we currently have that we've beaten out seven other states for um and now are in direct competition with only one other city.

Um this is for a 72 million dollar payroll.

Um, and that is and um 700 jobs.

Um and these are really good jobs.

I've uh had the pleasure of visiting the company um and seeing the diversity on the floor um both in culture and race and um sex, and they want to include more diversity on the floor.

This also they also are into um local hiring, local promotion um through their uh through their workforce.

So um the financial benefit is and that and they would not even take up half of this facility.

The other company that I was talking to that was also on the fortune um most innovative companies was another similarly positioned high-paying job.

Um unfortunately they were they were a manufacturer in the aerospace world.

Um, so that proximity to NASA Glenn meant a lot to them because one of the things that um Cleveland has a competitive advantage in is our ability to innovate and produce um at the same place.

So that it and that's throughout Cleveland.

So that is um critical in advanced manufacturing because we don't have the dispersion of the innovation knowledge of the actual advanced manufacturing process.

Those are critical to advanced manufacturing is the actual process with which we manufacture.

So without having to disperse that across the United States, um we have a competitive advantage in that.

And and the IX for that for the company that is no longer in the running, that um that was actually a huge competitive advantage for the one that's in our on our um in front of us now, 72 million dollar payroll is a very conservative estimate.

Um, and this doesn't include some of the projections that we've recently discussed.

So, how will that benefit the city of Cleveland?

The payroll tax financially.

Yeah, the payroll tax.

What are the numbers?

So uh two and a half percent of 72 million dollars, thank you per year.

So the city of Cleveland will get 1.8 million dollars a year with this particular deal.

Yes, correct.

And then there's a possibility for half of the the NASA piece to be given to another business potentially.

Oh, you that other business, unfortunately, we we lost out.

We we there are some cities that are able to just write checks to buy companies we're not in that position, so unfortunately we lost that company, but that's you know, so you're gonna win some and lose some.

Right, but we do have enough space to potentially add another.

Correct.

We have more than enough space to add another.

They would they only that company and they had another 500 jobs, only needed 500,000 square feet, and this is 2.2 million.

Okay, so when will we the city ideally would start seeing a return on on this deal here?

Uh on the deal in front of us, we're hoping that we would start to see the return on investment um next summer.

So 2027 in the summer.

And do we have a projection of what that would be?

Uh that would start at about one, I think it would be about uh 750,000.

Okay.

So in our first year, we're looking at about 750,000 dollars.

Yeah, rough, very rough estimate of like what their projections are for the initial jobs.

I see.

And and then um then I'll I'll reserve because I know that she has to leave.

Um I'll end my questions here and then I'll uh ask questions to the director a little bit more about the testimony here.

Okay.

So thank you, Mr.

Chairman.

Yes.

Okay, and and thank you.

Uh as I kick it over to Councilman Palencick and uh then Councilman Casey, I want to clarify the 1.8 million dollars would be two and a half percent of the uh payroll.

That is assuming this legislation were to pass.

If this legislation were not to pass and this company were still to come in, which would become a challenge, I think, to attract them, and I'd love for you all to get into that.

But even if that were to occur, we would only get 720,000 of it uh because the the balance of that basically a million dollars would be going to Brook Park under the current settlement agreement with the city of Brook Park related to the economics of the IX Center.

So that's what we're trying to untangle.

Councilman Palency.

Thank you.

Thank you, Mr.

Chairman, my honorable colleagues into the administration, the Ms.

Shield.

Ms.

Shields, you work in the economic development department.

Correct.

Okay.

Um are you aware of the previous legislation that came before us pertaining to the IX Center?

Yes.

Who was going in there?

It was like top secret CIA.

Nobody would tell us what was going in there.

And so I have I've become very jaded on this project.

I've become very skeptical, and I've become very inquisitive as to who's negotiating on our behalf and negotiating with who.

So the previous deal we were told there was going to be this big business going in there, creating all these jobs, never materialized.

And then the whole issue with the exhibition space being lost, which had been there since what, 1985, I believe, or so around that period of time.

So of the two million 2.2 million square feet.

How much of that is usable space in the building?

Through the council chair to the council member, this is uh all usable.

Okay, so you're you're telling us now that somebody is looking at coming in there.

We don't know who.

Again, I have no idea who.

Um the entire 2.2 million square feet.

Um, it would be just a portion of it.

Okay.

Just the portion of the, but you don't know how much.

I do.

Okay, you do.

But yes, but it would be 500,000 square feet to start.

500,000 square feet to start.

Yes.

And the remaining um 1.5 would be utilized for what?

We would continue to look for additional manufacturing businesses.

Okay.

And you're alleging at this table, you said 700 jobs?

Yes.

But you can't tell us who.

So that is a prerequisite to working with the international site selectors who we want to maintain a relationship with because they are hired to do this.

Okay.

So we own the building, correct?

Correct.

Okay.

Who for the public consumption?

Who has the lease on the building?

Um the public consumption is ICP and IRG.

So who's ever coming in the building will lease from them?

Correct.

For a set number of period of years.

The lease that they have on a building runs for how long?

Currently for 13 more years.

13 more years.

Um if someone can educate me, the the the legislation, the previous legislation was before us.

Was that to extend the lease?

Was that less that that legislation was to extend the lease to uh basically create negotiating power for that other potential end user?

Uh try as almost as a workaround to uh what we're trying to resolve here, like this would be the more permanent fix.

Uh I believe that that authorization was given to extend the lease, but the lease was never extended.

Is that correct to the administration?

Uh to share that is accurate.

So the lease expires in 13 years?

Correct.

Okay.

And I'd like to see a copy of that.

The can the confirmed the lease uh termination is in 13 years.

Um you're indicating you're you're presenting to us this portion of the deal that will be before this committee and ultimately the council that based on your comments and your testimony today at the table that you believe that this is a good deal, correct?

Absolutely.

Okay.

So when are we to learn as to who is going in there?

I can't wait to tell you.

But unfortunately, I know I said I can't wait to tell you.

Um when they make their choice.

Okay.

Yeah, no, and it's not with the CIA.

I'm under NDA with the site selector, and we want to maintain that relationship with all these site selectors because they use an objective analysis framework to get all these cities um uh you know working against each other and presenting the data in um a standardized format.

If we if we breach that NDA, they won't want to work with us anymore.

And you know, and I've been around here long enough to understand it.

There's some things you just have to keep tight, fist it and until the 11th hour.

But you know, this is like you know, the bride has been taken to the altar, and then the groom doesn't show up.

Okay, yeah.

So um we have heard a lot of promises over the years about the IX Center, and nothing's materialized.

So you have to understand some of our skepticism here.

Yeah.

Uh and I've been here a long time, and I've and I've heard a lot of um comments about the IX Center and uh promises, and it has not materialized.

So I'll leave it at that point, Mr.

Chuck.

Thank you, and I believe Ms.

Shields has seven minutes till departure.

Councilman Casey.

I'll be quick.

Um Mr.

Chairman and Ms.

Shields, do you have a title?

Uh executive attraction officer.

All right.

Do we currently today have anything written to bring a company into the IX Center?

Uh no L O U or LOI assignment.

So this is all just potential, maybe pie in the sky, hopefully, right?

There's nothing concrete that we have any business moving into.

Especially the magnitude that you just that you described, we have nothing in paper written down saying anybody's moving into the IX Center.

Absolutely correct.

Okay.

And I would just add that the amount of attention though that we've gotten from the IAX when we showed it as a manufacturing facility was immense.

And I had, you know, um, we are one of two in competition for this one business, and I cannot promise that we won't lose.

If we can't write checks just to make things free for companies.

No, I get it.

But my question was as of today, as it stands today, there's no difference in the IX Center today than there is tomorrow, because we don't have we don't have any pen to paper saying that we have any company moving in, especially one that you described with that type of potential in it, correct?

Correct.

All right, thank you.

Are there any other questions for Ms.

Shields?

All right.

Thank you for very much for coming.

You're welcome to stay for six more minutes.

Uh but I honestly I think that was a good, a good uh cue up to speak to uh and I say this as a former site selector, there I see a lot of value in the IX Center.

Uh it is it is a very unique facility, and there's gonna be uh an end user at some point who this is this is they've been dreaming of this, this is their unicorn.

Uh but right now I am of the opinion that our ability to uh to to s close the deal is is hindered by the economics dating back to 2001 under the assumption of there being a third runway.

Uh so if we could go back to the beginning of the presentation, I'll turn it back to you, Chief McNair, to kind of give us the exact substance of what this ordinance would do understanding that it could benefit a potential end user in the IX Center that's different from how it's been operating for uh my entire lifetime plus two years.

Uh thank you, Chairman.

And and by the way, I I I want to say that I also appreciate that line of questioning, uh, particularly Mr.

Casey's.

I think as we said at the last uh uh committee hearing on this, right?

Uh we view this as a good deal regardless of the tenant.

We are not doing this for a singular tenant.

We are doing this to untangle an asset that otherwise we can't really utilize to its fullest potential uh as it sits there.

And I also uh want to say that I appreciate Councilman Palencick's comment uh on the previous legislation that was passed to enable us to negotiate a lease extension.

I think the more that I looked at that, the reality is is that I wouldn't enter into lease extension for this facility unless this legislation passes to untangle these assets for a variety of reasons, and that's really what we're here to talk about today.

Um because as Councilman Polenzik says, we have to stop doing bad deals, right?

And though I know, and this kind of gets to our our first thing on the way this was all set up, uh I am not blaming anyone for what they were looking at in the early 1990s when everyone felt this was the absolute best thing to do, uh, you know, to radically change how air transportation worked uh in our region that they really felt was gonna move our economy forward, but it didn't happen.

And because of that, it's been a very bad deal, uh, right?

And so we are now looking at how we and and the reality is is because of it, and you'll see as we go through here, Brook Park has certain rights here.

So we don't have the ability to just cut Brook Park out, right?

And so what we're doing is we are getting rid of a very bad deal for the city of Cleveland and striking what I think is a fair deal for both municipalities that allows us to move forward.

So uh again, just as a refresher on this, if you look at the history on this goes back to the early 1990s, uh when Cleveland Hopkins went to expand and and create new runways uh that was sitting there, and that led to a variety of lawsuits that went through there in 1999.

The city of Cleveland acquired the IX Center while it was still in the city of Brook Park, uh, right?

That led to a variety of eminent domain lawsuits and various things, all of which led to the 2000 uh runway settlement agreement, which is what we are here amending today.

Uh and then uh again, I think this was signed in August of 2001.

Uh I think we all remember what happened in September of 2001 uh when two planes flew into the World Trade Center in New York City that also radically changed air travel.

Uh I think that radically changed the future of the airport.

Uh and then we know in 2008-ish, 2007, 2008, the United Continental merger happened.

Uh and that need for the third runway disappeared.

And so we were left with the IX Center.

A series of lawsuits to kind of get us to today.

But if you look at these details, what happened was we transferred that area in purple where NASA Glen Research Center is.

That land was in the city of Cleveland.

We transferred it to Brook Park.

We took that area in pink, the Emerald Corporate Parkway, which was in the city of Cleveland.

We were collecting whole revenues on, and we created a joint economic development zone, which splits both property and income taxes 50-50 between Brook Park and Cleveland.

We agreed to acquire and demolish residential properties, that area in green that are still in Brook Park, right?

For a runway protection zone.

And then we received the IX Center and the lands that surround it that was previously in the city of Brook Park.

So it was almost like a land swap for NASA Glen and the land around IX.

But the 2001 tax rights for Brook Park, right?

That level that Brook Park was at in 2001, they got to keep all of those.

And we'll go into detail about that, right?

So then as we fast forward today, this settlement agreement, again, we're going to go through these in more detail.

But what this will do, this will abolish that area in pink, the Emerald Park JED.

So we will now collect all the revenues that come out of there.

Currently, about six last tax year, $610,000 was in total for that area.

So $35,000 give or take went to the city of Cleveland.

$35,000 give or take went to Brook Park.

There's also about 40 acres of developable land around the Emerald Corporate Parkway that we can hopefully unlock.

It abolishes all the tax sharing at the IX Center, right?

And we'll go through in detail what that tax sharing looks like.

But right now there are a complicated splits that go to Brook Park in Cleveland.

All revenues from the IX Center will now start to come to Cleveland, right?

We'll walk through the numbers of that more in following slides.

This was the most important part to me.

Right now, that deal goes into perpetuity forever, right?

The only other way, outside of you passing this legislation to end that agreement, would be for us to honor our obligation in the settlement agreement and tear the IX Center to the ground.

We have investigated the costs of tearing down the IX Center.

They're significant.

It's 30 to 35 million dollars.

We would also enable to do that.

We would have to buy out our master lessee from the lease.

We've not began those conversations, but they have 13 years of term.

I'm assuming that would be very expensive.

And then we would have to build a new facility on there, right?

That's a really expensive way to get out of this.

So it ends the perpetuity of this.

It also ends Brook Park, you know, kind of getting portions of revenues.

And how do we do that amicably in a way that works for everyone?

It ends those nine years of litigation.

What does Brook Park get out of this?

There is a one-time $2 million settlement payment out of this.

It dismisses the litigation that is at the table, which is good for both sides.

They will receive a $650,000 annual payment in lieu of taxes for the next 33 years.

That's about 21.4 million dollars in total.

If you look at that in aggregate, which again would be slightly less than what it would be to actually demolish the facility, let alone the other costs.

They would get the 34 acres that the city of Cleveland has acquired in Brook Park back.

And they would be rezoned to their original thing.

We'll talk about the FA in a minute.

But want to get into each one of these areas in a little bit more detail to hopefully simplify some of this.

So the first one is that area that is the Emerald Corporate Park.

So again, this is land that is wholly within the City of Cleveland corporate limits.

40 acres of that, roughly, is undeveloped, and we would have the ability to again develop it.

If you look at what's in there, there is ODE, which is a great Cleveland company, just plumbing supplies, they're national, uh, that sits in there.

There are a couple of hotels, including a Hilton Garden Inn, uh, Greaton Road Tavern, uh, right, uh, great restaurant.

So there are a variety of uh we'll say a variety of different types of tenants in there.

Uh this area is currently in a joint economic development zone agreement, right?

So it's a 50-50 split of all income and property taxes in here.

Uh as you can see, last tax year we collected just over $610,000.

That went evenly both ways to each city.

Um this was interesting, we looked at.

So there's about 35 acres that are developed.

If you think about the types of tenants in there, it comes down to about $17,500 per developed acre in terms of tax revenues coming into the city of Cleveland.

So we're abolishing the JEDs, right?

We now collect all revenues within here.

If we developed those remaining 40 acres and receive similar revenues from those diversity of tenants, that would translate to about $700,000 annually in new revenues and income and property taxes for the city of Cleveland, right?

That in and of itself could pay to kind of eliminate uh the payment that we have.

Um but again, at the bare minimum, we're already paying Brook Park about $300,000 a year towards that.

That's money that could quote unquote go to uh the payment move taxes for them.

If you look at the IX Center and the surrounding uh lands there, again, that is about 165 acres of total land.

Uh there is about 47 acres of that, which is the area immediately to the west, uh, is is developable, has been undeveloped in this weird tax sharing arrangement.

Um there is that existing asset that we just talked about, a 2.2 million square foot building.

Uh, you know, there is uh the very strange again, brook parks tax rates were all frozen in time.

Yes, sir.

Can you and you can you just briefly clarify?

We can see the frame of the building.

The 47 acres is that area to basically the left of the wording, correct?

Yeah, like the existing parking lot and to the left.

Correct.

Correct.

It is it is to the left.

If you can see the shadow of the building, basically under center and Ertis, uh, to the left of that.

It is a portion of that parking lot and the land that is adjacent to it.

And again, really unique property.

This is obviously uh directly connected to the airfield.

Uh it is adjacent to NASA Glen.

I think that that is one of the reasons that uh aerospace type companies are deeply interested uh in this in this thing.

And so uh, you know, again, if we can unlock those properties, I think that there are these are could be used for airport expansion type activities.

Uh there are a lot of possibilities what might happen there.

Uh again, Brook Park tax rates were frozen in time at 2001.

So the first one and a half percent of all income taxes as it stands today, uh, that go on there, go to the city of Brook Park.

Um for a while we were receiving no income taxes here.

When we passed the income tax increase in 2015, 2016, right?

Like now that we're at a two and a half percent rate, we collect that back one percent of income taxes on there.

Uh property taxes, um, it's really based on the millage that Brook Park had at that moment in time.

That equates to roughly they get the first 36.

Uh 75% of property taxes go on there today.

Um, just because we need to make it more complicated.

This is actually in the Cleveland Berea tax district, so uh the schools portion actually goes to Berea that's on here.

Um admissions taxes.

Uh so Brook Park's admissions tax rate was 3% uh in 2001, so they get the first 3% of admissions taxes.

The City of Cleveland emission tax rate is 8%, right?

So we get that second 5% uh that comes in there.

Um very important to note, um all parking revenues, right?

So not just parking taxes, parking revenues generated here as it stands today, all go to uh the city of Brook Park.

Um if you want to look at like what that means in real numbers, uh the IX Center produced about 475,000 in total revenues on that complicated formula uh in 2024.

Uh that is, of course, uh ICP IRG, their affiliate that operates that, uh, you know, has not been operating as many trade shows, so that revenue has gone down.

So we also showed what that looked like at peak uh where about a million dollars was raised in total revenues for the entire property.

Uh that was in 2018.

Uh and you can see how that kind of split goes.

Um in the New Deal, we would abolish all tax sharing, right?

All revenues would come into the city of Cleveland, right?

And this is again constant reminder uh that the IX Center, while owned by the City of Cleveland, has a master lease on it that extends for a period of 13 more years, uh that is operated by an affiliate of ICP Industrial Commercial Properties and IRG, I believe, Industrial Realty Group, uh, right.

Uh and that runs for approximately 13 more years.

We have no say in who they lease this building to, right?

I know that there have been a lot of conversations out there around the trade shows.

Uh I do just want to make it clear uh that we have uh no say whether or not uh they lease this building or a portion of this building to trade shows or not.

Um, you know, we have had conversations uh with that group, and we have told them look, if you only bring us trade shows, uh the odds of us giving you a lease extension on it uh is relatively limited because that doesn't maximize the value of the building to the city of Cleveland.

Um but they operate it for 13 more years, they can do that if they so choose.

Uh they could operate trade shows and also bring an industrial tenant that may necessitate a need for a lease extension, and we can have that conversation.

But I think it's important to note um that is not our decision at the moment, and that is the lease that we inherited uh that stands today.

Um this is one of the more interesting areas um and and I will let uh Chief Griffin and Mr.

Carr chime in on this a little bit.

Um, you know, so the Brook Park residential acquisition program land.

This is land that still exists in the city of Brook Park.

But the city of Cleveland to date, because we were going to acquire all this for a runway protection zone that never happened.

So we ended up, yes, sir.

But before before we get into this area, uh Councilman Jones has a clarifying question on the operator of the IX Center.

So before we get too far ahead of it, if you could you can just ask that question for clarity and we'll move on.

Mr.

Mr.

Chairman, thank you.

Uh to the director, you you broke down basically it the deal goes through.

Um the resources that would now come back to us would be everything pretty much yes, sir.

Uh with the only issue here is that there's already an agreement in place for 13 more additional years.

Yes.

How does that impact or does it have any impact on any of your earlier statements in terms of the income taxes, the property taxes, the mission taxes, the prop the parking uh revenues that would be uh uh all brought over to us.

And now what it sounded like to me, and I just want to make sure I'm clear on this, is that this this deal that or this agreement that has been put in place for 13 years, uh that the only thing that could potentially impact is the parking, is that what I'm hearing?

Will it impact anything else?

No, so it would not it would not uh them being the master leaseholder has no impact on the deal that we make, right?

And this is why I say it's to me we are untangling the asset.

Now, the reality is is that that group controls who they lease to that's in there.

Now, their whole world of business, right?

They own and operate lots of industrial buildings, uh not just in Northeast Ohio, but beyond this is what they do.

Their interest is in attracting high quality manufacturing tenants, uh, we are aligned in that.

Uh, you know, we are working with them on the attraction of some of these types of tenants, um, right.

But like I I will say when we think about the deal, and and I know I've had this conversation with several of you.

Um, if they so choose to lease to trade shows uh in the future for a period of time, um, what this would mean is that if we do the deal, we collect all revenues from those trade shows, including parking revenue, right?

Um if we don't do the deal, those revenues are split out.

I know that I I also do think it's important to note because it's been brought up by several people around potential future parking uh for events that may occur around here.

If we don't do a deal in the future, there is nothing that presents them from striking some sort of arrangement to have event parking at this facility, and in that case, Brook Park would receive the revenues.

Right.

If we do the deal, that that's not the question though, Mr.

Chairman.

I I get exactly what you're saying about the deal, right?

What's concerning to me is the fact that you have you have this big elephant here that's in the room that when we talk to Mrs.

Shields over here, I'm under the presumption that she works for us.

Does she work for them or does she work for us?

No, Ms.

Steel works for us.

So she works for us, working through them to try to get this deal that you talked about earlier.

Yes.

Can they kill the deal?

So do they have the authority and the power to say what we want in here and what we don't want in here?

The the affiliate that operates the IX Center is the group that controls leasing at the IX Center.

Now, again, they are a group that uh owns and operates a lot of industrial buildings that does a lot of leasing.

They would love to have a high quality manufacturer.

So we are in conversations with them as we talk about attracting companies.

How do we untangle from them?

I mean, that's the deal.

I mean, that's the sweet spot.

Because right now you it sounds like, Mr.

Chairman, if I may, please.

Uh, that we're be, you know, we we we we have uh another president at the table that we haven't seen.

So through it could have an impact on whatever we do here.

Through through the chair to Councilman Jones, I would agree that it is complicated.

This is a lease that we have inherited, and and you could make one argument that you would love to see the city of Cleveland just be able to operate the building on its own and do with it exactly as it pleased.

There are advantages to having a master lessee uh that are out there.

Uh for example, one of the things that we know, um, they have proposed uh a pretty substantial renovation of this entire building, right?

To make it the type of facility that I think would really attract folks, like making substantial investments.

That's not money that we would have to invest, right?

Like we have a master lease with this group, uh, that rent is paid to the airport, uh, then they have private capital that they can invest in it, right?

So um, but the reality is is that they have that lease, and therefore uh, you know, we need to work cooperatively with them to get the types of tenants that we all want to see.

Who who are they?

Uh again, the affiliate that it's an affiliate of two entities, one of which ICP, their industrial commercial properties, the other group is IRG.

I believe that is industrial realty group.

I can't do it.

Mr.

Chairman, can you break down who they are, the names of the people who runs these operations, these three groups are so the principal at IRG is a gentleman named Stu Lichter.

Can you bring that put that in writing for me?

Yes.

I like to have in writing who the because now it's getting a little bit more complicated.

Um we're not just talking about a a one deal.

We're talking about maybe two or three parts within it.

So does that sound right?

Am I strapulating that from you correctly?

Yes, and and obviously they have made it clear that they would like to have a lease extension on this facility, and you know, I think that we are open to it under the right circumstances.

Um, again, the lease that was set up originally with this, um, you know, they were able to buy out the rights to that lease.

We had no say in it.

There it was not a very city friendly lease.

And so there's and and they have it for 13 more years.

If there is one advantage of a lease extension, it gives us the ability to go in and clean up some of these things and make it a more fair and equitable lease.

Thank you.

So, Mr.

Chairman, I'd like to to request uh if if the committee is hearing this, I'd like to request uh the lease that um this 13-year lease that we're talking about so I can have an ideal of what that is, what what are we actually dealing with with that?

Um and then the second request of information is who are the major players that is a part of this entire piece here, because that hinges on any success that we do here at the table right now uh is being able to fundamentally understand who the players are, what the deal, what what the agreement is already previously in play, and what are we fundamentally dealing with uh as a totality of understanding this deal as a whole?

If that makes sense.

Through the chair to the councilman, I've been texting to get a copy of the lease.

I'm told that the airport will uh get us a copy of the current lease and email it uh to you.

We will make that available since we're I appreciate that.

And and I will uh before we move on, I I will just say through the chair to the councilman, um both of those entities individually and certainly together, they have a long track record of success in leasing in the industrial space.

Okay, so you like them.

They're they're they're friendly.

Or are they?

They have we have a good relationship with them as we work through this, and again, they own and operate a lot of industrial buildings very successfully, not just the Northeast Ohio.

Have we thought, and then this is it, Mr.

Chairman.

Have we thought, you know, in terms of the law department, how could we untangle there as well?

Has that was any given thought there, or we just never really thought about it or did we?

Uh through the chair to the councilman.

Uh we're doing this in stages, and so uh we will look at how to uh divorce ourselves or rearrange that agreement as well.

Uh but our first step is to make sure that we can take control of the property through this uh through the settlement agreement, and then I think that's the next step on how we maximize uh city control and city uh well, city revenues.

Let me say that.

There may be there may be a decision that maybe the city's not the best manager of a piece of property.

Perhaps uh someone with with uh industry experience is a better manager.

Correct.

I understand.

Thank you.

Yes.

Thank you.

And just briefly, a prominent property that this group also uh manages and has turned around.

If you're driving to Columbus at the Lodi exit on 71, there's a uh uh outlet mall that kind of fell on hard times and they took over the outlet mall and turned it into like manufacturing and warehousing and stuff like that.

So that's something just as you're driving to and from Columbus, you might see.

And then on the on the lease, just to make a brief analogy, like we were so confident that we were gonna tear down the IX Center that we entered into uh a lease that basically gives all to your question about their exclusive management of the building.

Uh we we hedged our bet.

And and to make an analogy, it would it would say you're purchase a home with a very high interest rate because you think you're gonna flip it, you know.

So it's and then you end up something happens and you're not able to flip it, and now you're paying a mortgage with a really high interest rate because something fell apart, you know.

Uh that's that we're trying to correct for basically we uh made a gamble in the year 2000 and then uh demolishing this for the third runway, which would have gotten us out of all this entirely, just never came into pass.

But uh thank you for your clarifying questions.

Let's pivot back over to the land in Brook Park, because I know there's been a lot of questions about that.

Yes, so I yes, and I know there have been a lot of questions on this area, and so again I'll I'll let Chief Griffin and Mr.

Carr kind of talk a little bit more about it, but um the the the real quick right, these were the 34 acres that the city of Cleveland did acquire uh once the runway plan is expansion.

We were actually supposed to acquire uh all that land where you see the houses kind of heading westward.

Uh we did not.

That led to the latest litigation.

There were some questions around uh the FAA, but but again, just to be clear, this is in Brook Park, not in the City of Cleveland.

So we have no rights whatsoever to tax revenues or things that would come from this land.

Uh this is still firmly in Brook Park.

Um is this the area where they tore all those houses?

Uh yeah, through the chair, yes, it is.

We we acquired and tore down um houses in zones one and two, uh, and then we were sued because we told them that we were not going to go forward with it any further, and we've been in litigation.

I wanna um add on to uh Chief McNair's comments, which is not only do we not have any rights to uh any income off of those, but in fact we are limited, we're prevented from doing anything with it other than for an airport purpose, which we no longer have.

So we have essentially a liability of uh these 34 acres, which we can't do anything with.

So the value to us, if we were gonna build the runway, it would have value.

We're not building the runway.

So far from having value, it's a negative to us.

Uh and so this is uh an opportunity for, I think as people have used the metaphor accurately, it's a divorce.

And one of the things that that you get in a divorce uh is freedom, which is the freedom and risk to do well with the IX Center, uh, but also to no longer be bound by these obligations in Brook Park as well.

Um we we did evaluate it, we asked for an appraisal, uh, we appraised it about 4.3 million, uh, but again, it's nothing that's usable to us.

So um I think this is a good deal.

The other piece that I would say is it's a subject of litigation where the city of Brook Park claims that uh we're not maintaining the vacant land, uh we are an eyesore, and so not only is it um a sort of a a binding inhindrance to us, uh it costs us money.

Yeah.

Mr.

Carr.

Just a real quick update.

Um, as we're working through that settlement agreement, uh the Department of Port Control has been in contact with FAA.

FAA has determined that a land release or a change in use request isn't required in order to transfer the property to the city of Brook Park.

The only requirement that they have brought up uh to the airport is a potential avigation easement to ensure compatible land uses for future use of the property.

But uh I think that's a significant step in moving this forward uh with the Federal Aviation Administration if they're not requiring that because that would be a uh an additional process that we would have to go through, but they've uh foregone um the uh that requirement for us.

Um and then I just how does some of these things come together from a financial picture as it goes on there?

And and again, I know oftentimes we are looking for specifics that is really hard to do because as was mentioned earlier, uh while we're in conversations with uh certain company, there's no guarantee that it lands.

Uh you know, this is not a deal that we are looking over any one individual tenant.

We're trying to make a deal that sets the city of Cleveland up for long-term success over here and long-term financial success.

So uh, you know, and and I always say it's like if we look forward 30 years from now, how will people judge this?

Uh you know, they will forget about the Emerald Corporate Park, they will forget about these lands where houses were uh in Brook Park.

What we essentially did was we swapped land of what is NASA Glenn Research Center that was in Cleveland and and we sent to Brook Park.

What we essentially did was we swapped land of what is NASA Glen Research Center that was in Cleveland and and we sent to Brook Park and in return we received the IX Center and surrounding properties that was in Brook Park and came to Cleveland.

Uh if you go back to 2001, uh NASA Glen had roughly 3,000 employees and they were paying $1.9 million in income taxes to the city of Cleveland.

Uh and and if you look at today, they still have roughly 3,000 employees.

They paid $3.5 million in income taxes to the city of Brook Park, right?

Uh incomes rise over the course of time.

If you look at our budget, income taxes are what drive a lot of the revenues to the city of Cleveland, uh, right.

And so what we have today is a facility for the last 40 years has been uh operated as a trade show space.

Um that was pre-convention center downtown, uh, right, and and I am not disparaging the trade shows.

I think they have a lot of value in a variety of levels around here, but I think that there is also a reality financially speaking to the city of Cleveland, uh, it doesn't come in anywhere near the way a facility like this leads to high quality industrial tenants and the income taxes they could pay to the city would.

And so uh again, if you look at what the IX Center uh produced in 2024, uh, right, uh for the city of Cleveland, it was about 20, 228,000.

That's it for us, uh, right.

That 475,000 dollars total uh that went on there.

If you look at the peak of when trade shows were doing great pre-pandemic, uh the building generated about a million dollars in revenue total, uh, and that was about $500,000, $520,000 that went to the city of Cleveland.

Um, and so what we've kind of come back to then is like, all right, if we're now making a play where we're collecting all revenues that come through here, um, whether or not ICP IRG wants to lease a portion of this facility to trade shows for a period of time, we would collect all revenues on that, which again, all revenues is better than part revenues, right?

Um, but I look at it more as like what is a total payroll that we can put on any of these areas that we've accumulated, uh, whether that is developing, as we mentioned, geez, just the Emerald Corporate Parkway.

Um, if we just develop those 40 acres around there in similar fashion what was there now, that could easily generate $700,000 a year for the city of Cleveland.

That would almost make like bringing on the IAX Center free, right?

Uh similarly, like what are the types of payrolls we could get either at Emerald Corporate Parkway or the IX Center?

And so we went through a little bit of an exercise where we said, all right, additional payroll, right?

Two and a half percent income tax that we would get.

Uh we factored in the six hundred and fifty thousand dollar payment that we would have to make uh to Brook Park over the course of that time.

Uh and because as Miss Bordeaux Small knows, and as we discussed earlier, um uh, you know, part of the issue that we have here is we don't have the ability today to incentivize any companies to come into this facility because of that weird tax sharing, right?

So we factored in some basic incentives uh around here, things like the job creation income tax credit, which gives 50% of income taxes back for five years, and we just started to look at total payrolls over that 33-year time period.

If you just have $25 million of total payroll uh in this, right, like we would make out plus two and a half-ish million dollars on here.

As was discussed today, there's a company that is looking at this right now that has a $70 million payroll just for a portion of the building, right?

Um, you know, and so in that scenario, you're looking at 40 plus million dollars benefit to the city of Cleveland over the course of time.

Uh, you know, I I keep trying to say this like is there risk in this deal?

Sure, there is some risk in this deal, right?

We're making a fixed $650,000 payment, and the one thing that we know that we would get out of that is the $300,000 in revenue that we're currently giving to Brook Park over at Emirate Corporate Parkway, right?

So if Emerald Corporate Parkway sat vacant, if not a single trade show or business operated in the IX Center, we could lose upwards of $350,000 a year, right?

But like those properties would have to sit vacant for like 30 plus years.

It doesn't take a lot if we are really focused on like how do we bring businesses in here, how do we help make that here?

It doesn't take much.

And income tax is like again, we're making $650,000 flat pay.

That's flat.

$650,000 today, like $650,000 10 years from now will be less worth less than it is today.

Whereas income taxes will continue to rise over course of time.

That is why NASA went from $1.9 million in income taxes to $3.5 million in income taxes.

So we are gaining an appreciative asset, right?

And we're giving up a fixed payment.

I know that there are some folks that uh would prefer that Brook Park get nothing out of this.

Um again, Brook Park has rights on these properties.

They last into perpetuity.

Unless we want to spend all the money up front, which we don't have lying around to tear down this asset.

What we're essentially doing is we are financing out, buying out Brook Park's tax sharing.

There are 240 acres that are currently under tax sharing between these two municipalities.

So if we're paying 21.45 million dollars over the course of 33 years, and we're getting 240 acres back in total control, that comes down to about $89,000 an acre.

Right?

Like again, there is minimal risk in this.

There will always be some risk.

There is very high potential for reward.

Um again, this gets Brook Park out of Cleveland, Cleveland out of Brook Park, that the divorce gets finalized.

It gives us the ability to bet on ourselves to fill these things, it gives us substantial upside.

This is ending one of, again, doesn't matter what everyone thought was going to happen, the way it unraveled, we are taking down one of the worst deals in the city's history and creating a fair deal that gives us the opportunity to maximize this asset and put it back into circulation for the long-term future of the city of Cleveland.

Okay.

Um, so uh let me I have a couple and then we'll start going through our list.

Uh Chief Yes.

Uh I'm sorry, there was one one other point that I wanted to add since the last time of our June 1st hearing.

Uh the City of Brook Park has passed legislation that would move this forward.

And so essentially what we have in front of us is uh Brook Park has agreed to this.

Um we have the ability uh through at July 15th to come back and vote and do this deal that would abolish all tax sharing uh and allow us to begin to start to benefit out of this.

Um but they they have already acted on their end.

Okay.

That was actually my first question.

So thank you.

Um two quick questions or points of clarification.

One is in in reference to the land that Cleveland owns in Brook Park.

Uh my understanding is that it is currently zoned.

Brook Park has an airport zoning code designation, and it is zoned for airport uses, and there's been questions about whether or not the land is developable.

Uh my understanding is whether or not the land is developable at this time, the land is only allowable for airport uses per the Brook Park zoning code, and in order for uh in a world where Cleveland would want to uh see something developed there and accept that the revenues would go to Brook Park.

Brook Park has the legal authority through its zoning code to basically block anything from happening on that land because it's zoned under their regulations, not ours.

I just want to confirm that.

Uh to the chair, yes, that's correct.

It's also limited by the settlement agreement as well, that it can only be used for airport purposes.

Part of this divorce would let Brook Park change its zoning.

It's still going to be subject to the FAA though.

They they can't put a uh 30-story uh building on there.

They're still gonna be limited by federal aviation regulations.

Okay.

And uh so just to clarify, because I think that's what their point is.

The FAA regulations, could somebody speak more to what FAA regulations theoretically could be?

I know there's uh things relative to um uh heights and um you know there's uh prohibitions against lights and uh residential uses because of the proximity to loud noises.

So it but Mr.

Carr, if you could speak to some of those FAA limitations on kind of the developability of the land we currently own in Brook Park.

Sure, absolutely.

So the Federal Aviation Administration has a um process called the 7460 process uh that looks at imaginary airspace services.

So any time a project is going to be developed either on or near an airport, uh, that project would go through uh that uh review process with the Federal Aviation Administration.

So anything that's going to be developed on this property in the future, uh regardless of what that land use may be uh would go through that process to ensure that there's height compatibility with our existing instrument approaches into the runways as well as just the navigable airspace in and around the airport.

Uh that would be the primary item that the FA would take a look at.

Um they also look at uh photometrics, so anything that was producing a significant amount of light uh that may uh pose a visual impairment to a pilot on the approach or departure to a runway, that would also be studied as part of that 7460 process uh in addition to um electronic uh interference uh with aircraft or with uh radio communications between the air traffic control tower and the airport uh and aircraft in the air.

So it's a uh multi-step process or multi-step evaluation uh that's done through uh the 7460 application, and all of those items would be evaluated by the Federal Aviation Administration for anything that's gonna be developed there.

Uh thank you.

So suffice to say uh to the administration, a combination of the FAA process and the fact that the land is regulated by another municipality is why the determination is that this the these these acres aren't a useful asset to the city of Cleveland, correct?

Okay.

My my final question, uh so within, and this was stated in in the terms of the deal, there's a a two million dollar settlement fee negotiated a one time and then the annualized payment.

Can you clarify the what the budgetary source for the one time and then the annualized payments would be?

Is that through port control?

Is that elsewhere?

Uh the two million dollars uh would come from the law department settlement funds.

Uh we litigated this case and won for about $53,000.

Uh it cost them for outside council about two million.

Uh we have one, but as uh part of the price for divorce, uh it will come out of the law department settlement funds going forward.

Uh the 650 a year uh will come out of port control um as I understand it.

Okay, so the uh as follow-up questions, the and actually let me let me rephrase that a little bit, which is there is established an independent fund which will take the revenues that are being paid by uh the lease the lessees, the corporations that are in there that will first go into that fund uh to fund the six fifty a year payment.

Okay.

Uh so for as follow-up for all intents and purposes, the annualized payment being part of the port control budget that is not general fund, that is basically airport users who are flying in and out of Hopkins and airline area.

It's a sp it's a special revenue fund, but we don't expect there to be a we don't expect the six fifty a year to be coming out of the general fund.

Yeah.

It's seated, it's seated from port control's budget, essentially.

Uh I I'm not exactly sure what the financial uh that arrangement is.

But but so for example, the parking uh and the lease revenues would go into the special fund, and then that fund would be used to pay the 650 a year.

So and I want through the chair too.

Um commonplace when we do things like a joint economic development zone agreement, the finance department will set up a special revenue fund for it, right?

Because those taxes come in, whether it be income property, whatever it is, and it kind of goes in as like a holding tank, and then they pay out those portions to other municipalities.

That is how it currently works with Emerald Corporate Park, right?

Those dollars come in, goes into a special revenue account, they then pay Brook Park out of there.

Uh and so in essence, there's gonna be a special revenue account.

I do believe that that number is listed uh in the legislation uh that sits there, that special revenue account, of which all taxes, tax revenues will come in there.

That is where the six hundred and fifty thousand dollars will be paid out of rent for this facility, my understanding gets paid to the airport since the airport technically owns the building.

Is that accurate, Scott?

That is correct.

Thank you.

To the IX center.

The IX Center.

Okay, so that goes to the airport.

The rent for the IX Center goes to the airport.

The tax revenues go to the city of Cleveland.

Okay, so explain why we would go to the chair.

Is there a list going on?

Yeah, yeah, I'll allow it, but then we'll get to uh you're next on the list.

Um but uh well let me just ask one more clarifying question, I'll kick it right back over to you.

Uh through the and if you don't have this, if you could provide this to us, we budgeted uh in the Department of Laws budget five and a half million dollars for uh judgments, damages, and claims.

Uh my assumption is that the two million dollar comes out of that budget.

Do we have a year to date uh total of how we are compared to that budget line?

Uh I can get that to you.

Okay.

Uh I think we're at about a million.

Okay, so it'll be tight this year.

Uh but I'm cheap.

Uh we don't settle cases uh and and we aggressively defend the city.

I think last year we returned about two million uh in our settlement.

Um it'll be tight this year.

Okay.

If you could provide that to staff, I will kick it over to Councilman Jones Polencick, uh Gray uh for well ten minutes.

Well, we'll start with trying to figure out uh why we why the airport is collecting rent from my and how much is that for?

Mr.

Carr, do you want to answer that?

Through the chair to the council member, the annual rent, I believe, is roughly $2.7 million.

$2.7 million.

But we'll all clarify that number and send that to staff.

Okay.

So why are we sending it to the airport?

Why would the airport be collected?

So the the IX Center was originally purchased, that $66.5 million was purchased uh with airport funds through our airline partners.

And so that's why the rent uh accrues to the Department of Port Control.

So those are the funds that we usually did we did in the deal in 1999, Mr.

Chairman, for clarification.

Can you repeat the question?

The funds that we purchased uh the facility, was those funds uh coming from the airport?

Yes.

To my knowledge, that is correct.

And and because the facility exists within the city of Cleveland, tax revenues come to the city of Cleveland.

But because the airline slash airport bought the facility, rent for the facility goes back to them so that they can pay down their bonds.

I see.

So the city at any time could come in and pay off the airport and then start collecting the rents, correct?

I think that would be a uh a more in-depth discussion that we would need to have.

Um, you know, is that possible?

Anything's possible, but I think that would be a uh a different discussion that we've had than uh to date.

Well, when the concept was initially brought to us in 1999, they didn't tell us at the table.

Something like Mike Blinsky is talking about now where those revenues were where the bulk of the money came from, we had no idea that it came from the airport.

And then it also raises other questions too, in my mind, in terms of how we use uh utilize our subsidiaries and the reason why we have subsidiary operations to be different from other operations is the reason why all those processes were put in play.

So I have a number of questions just off of that alone, in terms of uh, you know, what those rules and regulations were meant for initially.

So through the chair to Councilman Jones, first and foremost, I want to say uh again, what we're talking about today, uh, irregardless of any of those conversations is eliminating these tax sharing deals so that Cleveland begins collecting revenues on there.

I I do I do also think it is important to say out loud that there's been a lot of conversations I've heard um both internally and in this body uh around the challenges of landlocked airport and not having land.

And so I think that keeping the airport in control of the asset makes for long term because you don't know what's gonna happen in the future.

Uh and so that as they control that asset, um again, you you'd never know 30 years from now where we may be.

Yeah.

Um I don't want to belabor the point, but the point is is that there's so many parts and pieces, like as the more I'm starting to, or we're asking questions the more we're finding out stuff that we didn't know about.

So this is one of those things that you know we just didn't know about.

So if if you know, and it's one of the things when when you heard me sitting at the other end of the table when we were talking about the subject matter, um, was having a projection, knowing exactly, you know, is it a sweet deal, is it a good deal, or whatever it is, you got the projections in place.

So even though we have these numbers here that you you have broken down here, um, do you have a spreadsheet that gives me an outline and lets me know how we look with this particular deal, you know, within two years, three years, four years, five years.

And I, Mr.

Chairman, asked for that projection breakdown.

Do we have that projection breakdown?

We should.

We already have all the numbers here, all we have to do is put it in on your own.

Through the chair to councilman Jones, we did share with your staff kind of some of the income tax projections that we had put in place for this.

Uh I think that they have also kind of broken down.

I again part of the issue is that like we don't know who future tenants are.

No, I think are the trade shows or they're not.

So it's all projections.

No, no.

What is it?

I'm asking for, Mr.

Chairman, is is what you're giving to us now.

Right.

You're projecting.

Yes.

Right?

That's what you're doing even right now.

It's projecting.

But you do have some concrete numbers that you have that will be in front of us.

So the issue is what I'd asked for is projections to understand what once this deal is done.

Do do we know we have a good deal?

That's just a matter of just business bringing it in front of me to see if it's a good deal.

We've had an agreement with Brook Park.

It seems like they know it's a good deal, apparently for them, because they've already passed and signed off on it.

Yet we don't even have their agreement in front of us the legal document.

Nor do we have the legal document uh uh of of the actual deal, you know, at all in front of us.

Did we ever did we send that?

I requested that too.

We've provided uh a complete copy of the settlement agreement.

Okay, so that's the one.

And that's the one that was passed by Brook Park?

Uh yes.

Okay.

And we agreed to it first and then we jointly submitted both to this council and to their council.

We did it on Monday, they did it on the next two.

Uh no, it was last month.

Last month.

Do we have that agreement?

That was part of the original.

Did we get that agreement?

Because it's not a part of what we have in our books right now, that's in front of us.

Okay, well, I'll make sure that that you get that.

And and councilman, to your point of the kind of the projections, the what's in front of you, and also on the tablet that staff our staff prepared this IX Center deal uh does have a bit of a breakdown of showing kind of regularly.

Correct, yeah.

That was that was prepared by our policy staff uh to kind of run through the numbers of the current scenario and then the legislation's scenario.

So so that that may speak to some of your questions about trying to understand the economics of one option versus another.

So and and and I did want to say through the chair to Councilman Jones too, my my professional opinion, again, what we've done is try to create a fair deal.

Uh right.

Um ultimately um, you know, you can look at projections on here, and they are just that, they're projections.

But like all these things around the incomes that we could generate in both corporate parkway and in my professional opinion, won't be able to happen unless we pass this legislation.

Otherwise, all we're looking at, and again, we gave up an asset that was at the time generating 1.9 million dollars in in revenue for the city of Cleveland, uh, now generates $3.5 million in revenue for Brook Park.

And in return, we received a an asset that produced $228,000 in revenue for the city of Cleveland last year.

Right.

And so to get to the point that we can start collecting real income taxes, we need to eliminate the tax share.

No, I agree with your argument, right?

So I'm just just make sure we're on the same page.

The issue is how the presentation is made, right?

So we spent an enormous time sitting here at the table trying to go through the numbers that you had given to us a couple of weeks ago.

And there was questions that I had asked, and and it's just simple business projections.

You know, a breakdown on what all of these deals would mean, how we would move forward.

And then, you know, of course, Mrs.

Bridges talked about the possibility of bringing in, you know, two businesses, one that would give us the one of the reasons why it seems like we're urgent sitting here that apparently appeals appears that we have a deal on the table.

Is that correct, Mr.

Chairman to Mr.

Ms.

Bridges?

Um through the chair to the councilman.

Um we do not have a deal on the table, right?

We have no L O U or LOI sign, but we have several businesses that would fit extremely well here that we would get revenue from in six months versus 12 months to two years with you know some of the other sites where we have to clean and and build.

That's a huge selling point.

So to be clear, we did do projections for those types of businesses, and Scott and I also worked on MROs.

I see.

So we don't have those projections here, though.

And see that helps us here.

And then and we nor do we have the projections of of the actual deal.

So we have we have the ideal and the concepts of what we will get potentially based off the the current numbers, but we don't have any financial projections in front of us that really show us you know the a real clean pathway on the on the getting to the yes quicker and faster.

So as I'm going through this, I'm um I'm it's like going through uh a tough thicket.

You have to cut it down here, cut it there, cut it there before you can get your big equipment in.

Um so I'm trying to figure it all out here sitting at the table.

So it'd be uh be great to see those projections.

But what you're sharing with us is the possibility.

You're not saying you have anything concrete at all whatsoever.

And so uh I I get that, but it doesn't help us sitting here at the table when you've clearly stated that yeah, it's a possibility, but we don't know and quite won't happen.

You know what I mean?

So I don't know what I'm dealing with when I'm talking to you uh as you sit here as it relates to is this real?

Is this something I can touch and feel and it's gonna actually happen, or you're just giving us hope.

Through through sorry, through the chair, I just want to also um point out that you know I've been at the city now for three years, and for from the beginning, we've been talking about how we have been reactive.

And as a city, we need to be proactive to be able to set ourselves up for success and um you know bring businesses to the city.

And a lot of that is going to look like this, right?

Work where there might not be an you know an end user, but we need to set ourselves up for success, and I think that that's exactly what this is, right?

We know with all the you know, I think Chief talks about um when he started there was one fifteen acre site, right, ready for development, and we have now continued to grow that and this site is ready today, right?

Ready for development, and we have now continued to grow that, and this site is ready today, right?

We don't need to do um you know new construction, there's no cleanup nut needed, right?

Like this is ready, and we have real a real person here building our pipeline to bring um businesses um to this site.

So I I think that's really the approach, right?

And and the way that we're thinking about that.

And thank you, and thank you, thank you, Mr.

Chairman.

And just so that you can understand, I I'm not against the deal is how you brought the deal.

You see what I'm saying?

So it's how you painted the picture.

So it it's taking me longer to see your picture.

So when you can make it really simple for a person like me, you got the projections, I see the numbers, it's a no-brainer.

Right now, I'm still jumping through the math and the math and trying to see if the math makes sense.

And so now that we even have some other numbers I'm looking at, and then the hope that you brought in, which is good, but at the same time, there's no deal.

The issue is is when you if we could bring the picture of projections, and this is something that that I haven't said once it's not even about this deal.

It's it's about all the deals we bring before the council.

You know, this is a business.

We're running it as a business.

So then the proposition is bring me the business concept here as well.

Just don't give me the terminology.

Uh, but give me the outline.

Our staff shouldn't have had to try to break through this and bring their own paper to try to make us understand your deal.

The best thing is to for us to understand the deal is to actually fundamentally understand what we're going to be making.

You know, so after this deal is done, and we say yes at this table, it shows me that we got five, six million, you know, in the coffers after this, and it pays for itself.

What we do here is paying for itself, and is doing just as you saying, Director, is putting us in a position so that we can grow as a city.

So I'm not opposed to the deal, so I just want you to be clear is how the presentation has been presented in terms of projection of the numbers.

And so if you can project those numbers out, Director, you you your argument has already has sold me, it's just making sure that I can see those numbers and those projections, and then just how real Mrs.

Bridges' comments and statements are in terms of really bringing something viable here to the city of Cleveland within a year or two.

And I'm not sure if that will happen or not.

And how long, Mr.

Chairman, Miss Bridges, have you been working on this project?

Ms.

Shields, I'm sorry.

Forgive me, Miss Shields.

It's okay.

So through the council to the chair.

So I have been working on this particular deal for since December.

Um and so I saw um and and got us through um seven other cities and got us down to one of two.

Um and that took um real uh real strategy and aggressiveness, I'll I'll say, um, to to get them to come to Cleveland to view Cleveland.

Um and we would not have even known this deal existed if we did not have the IX.

We are missing out on deals that we don't even know about because we're not ready.

This is the only site that or only building that is ready to go for a manufacturer right now.

Yeah, thank thank you, Councilman Jones.

As I turn it over to Councilman Palencick, I'll just note for the committee uh staff added to the tablet as it's uh file 664, the A file is the actual negotiated settlement agreement between Brook Park and Cleveland as negotiated.

So if you want to uh uh do some casual scrolling, it is there for your reference.

And I will turn it over to Councilman Palencick.

Thank you.

Uh thank you, Mr.

Chairman, my colleagues to the administration.

Um I'm a very I'm appreciative for uh the people who are trying to strike uh what you've alleged at the table is a fair deal.

My concern is this I have such a bad taste in my mouth over the Browns deal.

Um and that's that's having a big impact on me.

And that will be the worst deal ever made in the history of the city of Cleveland.

I believe it is the worst deal ever made, and we're seeing it play out in front of our very eyes now.

So as we talk about dealing with Brook Park, um that has uh what has influenced me greatly in the whole course of this discussion.

In negotiations, do we have to be fair and equitable?

Of course we do.

Um we always like to be on the winning side, but when we're dealing with other municipalities, we want to be fair and with any agreed agreement or arrangement we enter into.

So uh we are gonna pay over the 33-year period, uh we're gonna pay Brook Park 23 million four hundred and fifty thousand dollars.

Okay.

And I need to know definitively, Mr.

Chairman, to the law director and to the team here.

So we'll I'll make that officially that request through the chair and to staff.

We need to know exactly where those funds will be coming for from over the 33 year period.

The 34 acres that is a part of the deal.

Who did the appraisal?

Mr.

Chairman to the director.

I have it here.

Give me a moment.

Okay.

So as the law director is looking for, we did the appraisal for the 34 acres.

And we in it's been indicated at the table that Brook Park controls the zoning.

And we know from our own legislative body, we can change the zoning.

That's a legal fact and a historical fact.

So based on that fact that they can change the zoning to whatever they want.

But that is 34 acres that they could develop for their city, and in essence to compete against our city.

And as of Councilman Casey, I believe pointed out very a very important fact that Brook Park is the only city that would not sign a poaching agreement, an anti-appoaching agreement with the city.

Director, is that correct?

Through the chair.

That is they did not sign a poaching agreement, anti-poaching agreement.

I believe there may be one other municipality or village that did not.

So in the course of this agreement, did anyone inject into the next negotiations the fact that we would like them to sign an anti-poaching agreement so they don't attempt to take businesses from the city of Cleveland?

That was briefly discussed, uh, but I don't think it was a major point because that that was a that was a dead end.

Um but I do have the appraisal report.

And I'm happy to give you a copy.

It's uh for it was prepared for OR OR COLIN associates by Emily L.

Brahman, MAI, SRI, SRA, and AI hyphen GRS.

Yeah, provide that through staff.

But again, there are 34 acres adjacent to the airport, a part of this deal that we are going to give to Brook Park, and they will not agree to an anti-poaching agreement, therefore they could attempt to take jobs out of the city of Cleveland, which concerns me greatly.

Um so I'm gonna put that on the table.

Uh the other issue is as been pointed out, I believe, in page eight um the revenue re we receive and that Brook Park receives.

Has there been any calculation over the 33-year period to exactly uh what we will be receiving?

And now we know things can change, and we have no crystal ball.

But do we have any idea that we come even remotely close to the 23 million we're paying them?

So revenue received through the chair to Councilman Plansack.

That is when you see the potential future revenue slide on there.

That takes into account, and again, we're trying to look at a wide variety of scenarios that exists here, but that does take into account that is over the course of 33 years, that includes a $650,000 annualized payment to Brook Park, uh, and it includes um a variety of kind of entry-level uh um incentives that we may give to companies over the course of time.

Okay, so but I'm gonna request through the chair because it still has to go on to finance, if administration could put together a rough estimate as to what we would possibly collect in this deal over that 33-year period.

Again, we understand we have to be fair.

I mean, we all like to win.

I can't stand losing, quite frankly.

It's just my genetic makeup.

I can't stand, but in the case of negotiations with them another municipality, we we want to be fair, we want to be equitable, as we would hope that they would look upon us as being fair and equitable.

What we were confronted with from the standpoint with the airlines, the fact that this was a hub, the continental hub was out there.

And I can brings back a lot of bad memories of this whole discussion over this whole um this whole original deal and uh the situation at the White Administration found itself in and ultimately the council.

Um but nobody had a crystal ball back then.

So here we are today.

2026.

And no anti-poaching agreement concerns me, Mr.

Chairman.

Um the fact of the matter again is that we've heard at the table from Ms.

Shields that she is negotiating for with the outside undisclosed company for half million square feet for the existing building.

Um we have no idea who that is.

Um we hope uh unlike the previous agreement presented to council, which was the stealth um occupant, which nobody could tell us who or what was going in there.

Um but here's my question to you, Ms.

Shields, if you can answer.

Of the remaining 1.5 million square feet, are you aware of the Haslin group negotiating for the remainder of the 1.5 million square feet with the with the person with the entity that represents that has the lease on the building?

I'm not aware.

You're not aware of that.

For the record.

I want we're at the table here.

I want to make I want to ask the question again.

Are you aware of any effort by the Haslin group to lease sub-lease about a little over a million square feet of that building?

From the present tenant, I'm the person that we lease the building to.

So through through the chair to Councilman Polenzik, I will ask that.

I think it has come out over the last couple of weeks and and has been stated publicly that Haslem Sports Group has approached the uh entity that controls the IX Center lease.

They have proposed leasing for a period of time.

Uh I have not verified what that period of time is, whether it's two or three years, uh, in an effort to keep the trade shows in place for a period of time.

Okay.

So you've indicated earlier that we have no control there's no sign off.

That is correct.

Okay.

So here's my concern in light of what how we got jammed down here on the lake front, and we got the upper and the lower radiator holes down here, okay.

Um you know what he's attempting to do.

Yes.

He's attempting to corral the trade shows for three years, and then move the trade shows into his new facility, and then compete directly against the Huntington Bank, uh the Huntington Convention Center, public auditorium, and rocket field house, or whatever it's called rocket arena.

And so I mean I am not like I'm gonna be very cautious on whatever I vote for, because I am not a I am not about to help this man who has screwed the city of Cleveland Okay.

Through through the chair, Councilman Palenzik, I want to say that one, we have no say in whether or not the master lessee leases to uh the trade shows or not.

Um I think what is in front of us is the elimination of tax sharing.

And so I think that uh if that affiliate agrees to lease to them, um we're in a situation wherein either the City of Cleveland could take on the revenues for those shows or those revenues would be split between Cleveland and Brook Park.

Um and and the one thing that I will add to that um is that we have made it clear uh to the operator who is looking for an extended lease on that.

Um our priority is, and and this is not a knock on the trade shows, which I do think provide value uh to the region in a multitude of ways.

Right, and and some of them I think would be great at the downtown convention center, some of which probably don't make sense of the downtown convention center, right?

Um but what we've made it clear to the affiliate is um our priority is attracting high quality manufacturing jobs to the city of Cleveland.

Um if there is a way for them to do both, that is not our decision.

Um but you know, ultimately again, we are working very hard to attract high quality manufacturers here, um, and they know that.

And I and I appreciate that.

And uh who actually negotiated the agreement, this agreement?

This particular agreement.

Uh so through the chair to councilman Palentic, uh the settlement agreement was uh portions, Mayor Bibb, uh myself, uh Chief Griffin was involved in that as well, and then various staff members from uh port control law as necessary.

But the the primary folks in the room were the mayor, myself, Chief Griffin.

I hope this wasn't over two cokes, let me tell you.

There was no coke involved.

Right.

Um because we know what we wound up with the two Cokes.

Um Mr.

Chairman, um, to my honorable colleagues and to Tom, I think you're a very competent guy.

Okay, but I I you you touched on it earlier.

We have been um I don't like losing.

We we're losing we're losing uh the the um the jail, we're losing um we're losing 18 schools, we're about or attempting to lose Burke Airport.

Um we seem to be on the losing end here, and I don't like losing.

That's just my nature.

I want to make sure that we don't lose on this deal and that it's a fair deal for the city of Cleveland, the people of the City of Cleveland.

So again, Mr.

Chairman, that anti-poaching agreement provision to me is very important because they're taking our football team, and they're taking the revenue associated with that rev that football team.

And I and then again, I don't want to be in a situation where then they poach against us for the 34 acres to take additional businesses out of the city of Cleveland.

I want fairness, I want equity.

That's my position.

And so I'm hoping that in the course of this process here that we can impress upon Brook Park if they really want to be good neighbors, then they they can't poach us.

They can't take our businesses out of the city of Cleveland.

I think that's not too much to ask for.

I think it's fair.

It's fair.

I want a fair deal for our people.

I want a fair deal for the city of Cleveland.

And and so, and I'll and there'll be no way in God's green earth that I'll vote for an extension on that IX Center if if if Haslin gets a 1.5 million of it square feet, so he can directly compete against entities in the city of Cleveland.

That that would be outrageous.

And to tear down the IX Center would be criminal.

Would be criminal.

You couldn't even nobody could build that place.

It'd be a billion dollars to plus to build that place today.

Maybe two billion.

So we know it's there, it's not going anywhere, thank goodness.

We got to cut the best deal, and I would hope to the administration that you would raise the issue about the anti-poaching.

Thank you, Mr.

Chairman.

Thank you, Councilman Gray is next.

The chair, I think my uh question I want to ask have already been answered between my two colleagues here um who gracefully had their say, but I just want to reiterate what um Chief uh McNair spoke on the revenue.

I wasn't here back there through that day.

I just want to clarify that um we said NASA Glenn versus IX Center today.

Now, back in between 2018 and 2024, who received that revenue?

Was it the airport or was it uh a city general fund?

I just want to clarify on that.

So Chair two or the Chief.

Through the chair to Councilwoman Gray, yes.

So rent for the building goes to the airport because the airport slash airlines paid for the building.

Uh tax revenues that come in because it's in Cleveland uh municipality, right?

Come to the city of Cleveland General Fund.

So you know, again, now we split those revenues in that really weird complicated formula with Brook Park.

Uh right.

And so that's where you can see the that's why I only list the revenues in there as the tax revenues.

I don't list rent.

You didn't list one.

I don't list rent.

Okay, you didn't list rent.

Because rent is going to that is I don't consider that revenue for the city.

That is revenue for the airport to offset costs of buying the property.

Okay.

So the tax revenue came to the city of Cleveland and to the general fund.

And to the city of Brook Park.

And the city of Brook Park.

So that was split.

Yes.

Okay.

So when it went into the general fund chair to the chief.

And it was used for the general fund.

Is there some type of data, a history to show what that money was used for when it came into the city of Cleveland?

Councils, who was back then?

Did y'all see any like whatever?

John.

Through the chair Councilman Great.

My my my understanding of this, right, is that those are revenues that go into the general fund and then they are allocated as uh yes for everything.

For everything.

Okay.

All right.

And that is what we're trying to do.

We are trying to include increase more revenues to come into the city of Cleveland.

Use the city.

So that in the city of infinite need and limited resources, right?

We have more resources to apply to those needs.

Okay.

So uh chair to the law department.

Uh is that any way that says that's public record?

Is there any way that that can be known uh from the revenue from the uh IX Center and it went to the general fund, what it was allocated to in different programs.

I know that's a big ask.

I wasn't there during that time, but since I'm now here and this can of worms have been opened up.

That is a curious question.

Uh to the uh uh law director.

Uh through the chair to the councilwoman.

Uh once the funds go into the general fund, they get commingled with everything.

So uh to kind of figure out where those monies went to, you would basically apply the percentages from the general fund to to those income pieces.

That would be the best.

There's no clear one-to-one you'd have to sort of estimate based upon how the general fund is allocated.

Okay.

All right.

All right, I'll take that one.

All right, thank you, Jake.

Thank you.

And and to the listening audience, just to give kind of a scope of like cost of the city, like 228,000 dollars in the general fund is may get you one or two streets resurfaced.

So it's it's a pretty it's not a look given given the scale of our budget, it's it's not making a huge impact to our budget.

It's it's it's worth finding ways to increase it through any means necessary.

Um, thank you for keeping your time.

I'll kick it over to Councilman Casey.

Thank you, Mr.

Chairman.

Mr.

Chairman, to Director McNair.

We sat down last week and I appreciate that, and we went over this, and I and there were two things that I was very specific about uh when we met.

Um one was that I didn't trust the administration in light of the history that they've had with negotiating deals.

And two is that I have no desire whatsoever to be a part of um helping the city of Brook Park and or HSG and or Jimmy or D.

Haslam in the development of any of the issues or problems that they're having uh with their new development out there.

I personally still believe that that 34 acres is going to help them resolve their biggest problem that they have over there and their parking issue.

Um and then to hear today that it was yourself that was Director Griffin and the mayor that actually sat down and negotiated the deal makes it even a bigger red flag for me uh to be very supportive of this, especially in light of when we didn't when when we sat down, there was no talk of the possibility of the Haslam Sports Group uh leasing the IX Center for three years specifically to keep the big trade shows there only for three years, uh and that revenue, be it whatever portion of that comes back to the city of Cleveland with the trade shows, and nobody has ever done a secondary economic study on the trade shows, like if somebody goes there from the city of Cleveland to the home and garden show and purchases something there and invests in their home, right?

Just to stay in the city of Cleveland.

So nobody's ever done a secondary economic development study of how those big shows help the city of Cleveland, even if a Clevelander buys a boat, then there's docking fees, whatever, right?

Only to know that the HSG is could potentially be involved in that three-year to eventually in three years completely take all of that away from the city of Cleveland, just doesn't sit well with me at all.

Especially knowing that he doesn't want them to come downtown to establish themselves downtown, because if we could get those trade shows downtown, then and they're established for three years, they're not going to just pick up then and leave leave again, right?

They people become creatures of habit.

So we know that it works out there if those trade shows occur if he wants them, right?

If he wants them, right, eventually in his facility, then the city of Cleveland is 100% completely out of whatever that economic development is, whatever those trade shows bring into the city of Cleveland in three years under the ausmos of him being involved in it, then we're completely 100% shut out.

That there doesn't sit well with me at all.

So by the time this deal is done, the city of Cleveland would have paid roughly 90 million dollars for the IEX center with the original 66 million, the other 23 million that we're putting into it over the next whatever amount of years, you're looking at roughly 90 million dollars for the IX Center, which we will never, I don't care who comes in to lease it, at least not in our lifetimes, we'll never break even on the IX Center from all the investment, the bad deals, whatever it was, the situation that we're in.

Do we know how many years are left on the sale bonds, Mr.

Chairman to the director of the original 66 million purchased?

And if the rent when those bonds are paid off, does the rent then come to the city of Cleveland's general fund, or will it still continue to go to the port authority?

Whoever would like to answer the question?

Yes, I actually do have that information.

If you give me just one second.

So my understanding.

Sorry, a lot of files here.

I believe it's 203.

Um I got it in here somewhere.

Okay, so either way, we'll say it's 2033, knowing that it's probably give or take a couple of years.

Does the rent then, Mr.

Chairman, to the director or to whomever can answer, um, does that rent then come to the city of Cleveland's general fund, or does it stay with the port?

I I uh through the chair to the councilman.

My understanding, uh and Scott can correct me if I'm wrong, is that the purchase and the bonds uh come out of the airport funds as similarly, so does the so would the rent payments.

So the city as a whole paid the amounts that you indicated, but it was the airlines and the airports who who had paid for that.

Right, but that's what I'm saying.

When those bonds are are are paid off, right?

Does the rent then still go to the port, or at that point, I'm I understand paying the paying the bonds off through the rent.

It's an airport asset.

But at that point, then the two the two million or whatever it is in rent, and we know rent only goes up, will that'll never come to the general fund then.

That is correct.

Or that always stays the rent will continue to accrue to the Department of Port Control because uh it is an airport asset.

Okay.

And then Mr.

Chairman, to the thank you.

You're welcome.

And then Mr.

Chairman to the to the director, you had indicated in some of your comments earlier about if we negotiate somebody coming to the IX Center or one of the trade shows that some of that money, that money then comes to the city as opposed to whoever's the IRIR, who is that IRG.

IRG does.

Mr.

Chairman, to to the director, then the question is why do we need IRG if we're out there and we have Ms.

Shields, and I and I've never met her, but I'm pretty impressed by what I'm hearing from from the table.

Why do we need IRG out there if we're out there actively selling the IX Center ourselves?

And is there a difference?

If she brings somebody into the IX Center that IRG ultimately has the the is the say yes or no over, right?

Explain IRG's role in this thing, and then why do we need him if we have somebody like this?

So through the chair to Councilman Casey.

Um in essence, yes, um IRG ICP, their affiliate that operates it, right?

Uh they are the ones who issue a lease within this, and so they would have to agree to any tenant that we found.

Um, you know, Miss Sheil, who has been a tremendous asset.

So uh she originally came here as a fuse executive fellow who helped us set up our business development practice within the Department of Economic Development, and then uh we were fortunate enough to bring her on full time uh to start executing that work.

Uh and so she has a broad-based strategy that is looking at the city of Cleveland Hole and how we bring these in.

Um now her subject matter expertise from her professional career is aerospace and defense, and so um you know, companies that are looking around NASA like that is a wheelhouse for her.

So uh she's looking for the city as a whole.

I think what she has experienced is that there's tremendous amount of interest in this facility for a lot of the reasons that have been mentioned today.

One of the reasons they want a lease extension is because they want to make a significant investment in this building, right?

They want to fully transition it to the type of manufacturing facility with facade improvements, new lobbies, like you know, it's a pretty dated structure.

Um that's capital we wouldn't have to expend, right?

They're paying us a fixed rent fee for the asset.

Uh and and then that you know, they can invest capital in that.

They are obviously incentivized to get a high quality tenant uh that can pay them better rent.

Um now again, if if the other municipality is out of the deal, if we think it's a great tenant, we want them there, we now have the ability to incentivize and get them in.

So uh again, it's the structure we inherited, right?

Um you know, ideally you'd make that decision yourself.

Okay, and Mr.

Chairman, to to the director, I'm just gonna run out of time.

How long has uh the you said they want an extension?

How long have they been operating the IX Center?

Uh through the Chair Councilman Casey, I believe since 2021.

Or no, 2019.

292.

Yeah, during COVID.

Okay, 2021.

And in those five years, right?

How many businesses have they brought in?

So uh through the chair to Councilman Casey, my experience of the last three years is that they have been continuing to operate trade shows.

They have been looking at uh redeveloping it as an industrial asset, which Frank has been.

So I'll take that as the answers being zero.

They brought none in, right?

I'm just saying, and we know that they want out of the trade show because they publicly stated that I guess unless, of course, the billionaire comes to them and says I can lease it to you for three years.

Do we have the ability to say no if they want to bring a tenant in?

Uh through through the chair councilman Casey, no.

As long as it's tenant that meets with the general industry zoning requirement, they could sign any lease that they so choose.

And then we have no say so in it.

That is correct.

It'll be like that as long as they're operating, correct?

That's even if we current lease arrangement.

And even if we current and even if we bring a bit manufacturer in, they can't they can still say no, right?

Through the chair councilman case, that's correct.

Thank you, Mr.

Chairman.

Thank you.

Uh Councilman Bishop, did you have any questions?

Okay.

Uh there any other questions from the committee.

If not, I'll ask the clerk to call the roll.

Yes.

I'm still thinking.

Can you go to the next name?

Yes.

No.

Yes.

Okay.

Uh thank you.

Um normally we go to miscellaneous, but it's been a long morning.

Uh so uh with that, uh, thank you to my colleagues for making time over summer recess to come in on this piece, and I will adjourn this uh meeting of transportation mobility.

Appreciate your guys' time.

Thank you.

This is going to be a couple of things.