By Karen Gleason
The 830 Times
A majority of city council members took a step toward approving funding for a local restaurant through a city economic development incentive program.
The council approved “an application and resolution for economic development funding through a 380 agreement with the city and authorizing the interim city manager to negotiate said agreement” during its most recent meeting on May 28.
The measure was approved on a 6-1 vote, with Councilman Jim DeReus giving the sole vote against.
After City Secretary Mari Acosta read the heading of the agenda item, Mayor Al Arreola asked for a motion. Councilman Jesus Lopez Jr. made the motion to approve, with Councilman J.P. Sanchez giving the second.
Arreola asked if there were any questions or concerns from council members and hearing none, he called for the vote.
Though the council did not discuss the agenda item, there were several pages of documentation regarding it included in the council’s informational packet for the meeting.
The first was a memorandum by Interim City Manager Manuel Chavez, in which he wrote, “On Friday, May 24, city staff received additional supporting documentation from Molcajetes Restaurant in support of their request for economic development funding from the city. City staff is currently reviewing the provided invoices for compliance with the city’s ordinance for approved expenditures under the agreement.”
Chavez also wrote he had attached a copy of “Article II Chapter 380 Agreements for Economic Development” as a reference for council members.
The “Article II Chapter 380 Agreements for Economic Developments” reads, “Texas Local Government Code Chapter 380 authorizes a city to establish and provide for the administration of certain economic development programs. The city of Del Rio hereby adopts Texas Local Government Code Chapter 380 as an economic development tool.”
The chapter provides that all applications for Chapter 380 benefits “will be reviewed and evaluated on an individual basis.”
It further specifies that to be eligible to receive Chapter 380 funding from the city, “the city council must first determine that the application proposes a project that promotes local economic development and that stimulates local business and commercial activity.”
The chapter also specifies the actions an applicant must take “to justify receiving the benefits.”
The interim city manager wrote he had also attached a score sheet “to determine if the application has met the minimum score of 75 points.”
Selection criteria are listed on a score sheet and graded on a point system that ranges from 0 to 100, and require an applicant to score at least 75 points. Selection criteria include “the industry being targeted, the number of jobs being created or retained, the total dollar amount of capital outlay, the total dollar amount of investment in infrastructure, the total dollar amount invested that encourages economic development, the total dollar amount invested that enhances quality of life in Del Rio, the total dollar amount invested that increases quality of business in Del Rio and the total dollar amount invested that improves quality of place in Del Rio.”
The next handout included in the council’s packet is an email from Molcajetes Restaurant owner Christian Mtanous to Chavez, in which Mtanous said he had attached a folder “with all the investment expenses needed to open up the doors for the new location.”
Mtanous recently opened Molcajetes Restaurant in its new location at 901 Veterans Blvd.
Mtanous’ email also notes he is missing receipts from several companies “but even with the ones I am sending, the total amount for those expenses come out to $546,535.75, which is more than the $500k you mentioned it needed to exceed for the (Chapter) 380.”
Mtanous in his email also estimates annual property taxes of $20,000 and writes, “For the employee and wages increase, at the old location we had 22 employees and payroll was on average about $4,000 a week. For the new location, we have a total of 78 employees with an average payroll of about $16,000-$18,000 weekly.”
The writer can be reached at delriomagnoliafan@gmail.com.
