By Eric Norwood Jr.
CNJ staff write
After minimal discussion, Clovis’ Economic Development Tax Advisory Board unanimously recommended awarding $100,000 toward a proposed $1.3 million upgrade at a city grain facility.
Charles Brettell, managing partner of Gavilon Grain, LLC, which owns the grain facility on U.S. 84 on the western edge of the city, said without the upgrade, his firm may consider shuttering the plant.
Clovis Mayor David Lansford expressed his curiosity with one direct question toward Gavilon managing partner Charles Brettell, who attended Thursday’s meeting by teleconference.
“Why would a company this large be seeking help on a small scale for a small amount of money from our municipality?” Lansford asked.
“We compete internally within Gavilon for capital, and every dollar out the door to them is the same. We have to meet the target financial thresholds,” Brettell said.
Gavilon believes that by redeveloping their facility, it would retain 21 current jobs, as well as create 20 to 30 construction jobs during renovation. While Brettell did not go so far as to say that operations at Clovis Flaking would definitely cease, he did say that it was an option.
“I think until we get a financial package we won’t be able to make a decision one way or the other. We have to know what the pieces are going to be,” said Brettell.
Gavilon Grain is No. 19 on the Forbes top 20 list of richest private companies in the U.S.
According to Chase Gentry, executive director of the Clovis Industrial Development Corp., a new CIDC program has been adopted regarding the distribution of economic development funds. Instead of paying applicants the money up front, they have adopted a post-performance pay model, which would give funds to those companies after a year of meeting guidelines.
“There is no risk this way,” Gentry said. “If they meet the guidelines after a year, they’ll get a check. If not, the city loses nothing.”
To meet guidelines, Gavilon must retain a yearly average of no less than 90 percent of the jobs they said they’d retain in their application, which would be 19. They pledged to retain 21 jobs. Gavilon must also provide a one-year audit report stating they attained every parameter that they laid out in their application. Each year would require a new audit.
The first payment that Gavilon could receive would not be until February 2015.
“At this point, we are creating an inferior product. This project would let us expand our output, and produce more efficiently,” Brettell said.
CIDC has about $2.5 million it its economic development tax fund, according to Gentry.