2007 YEAR IN REVIEW
CDC focuses on keeping local industry, saving jobs in city
By BRENDA SOMMER bsommer@leader-news.com

L-N File Photo Helping Hand A job fair held last year helped area workers find jobs as Cardell Cabinets was forced to shave its workforce.

The City Development Corp. of El Campo had a busy 2007, finding itself involved in lawsuits, moving to a new headquarters and helping two companies create or save jobs.

Some of the major events for the CDC during the past year include:

Incentives save Cardell jobs

Cardell Cabinetry, set to shut down operations here by early April, instead agreed to stay open with a smaller workforce after city economic leaders worked up a package of enticements that swayed leaders of the San Antonio-based company.

The local Cardell operation remain opened, but down-sized its workforce to about 100 employees.

Cardell was the third largest employer in the El Campo city limits with 250 workers, and the city's seventh largest taxpayer. The company said Jan. 31 it planned to mothball the El Campo facility by April 6 in response to a general downturn in the housing market, a move which could have meant up to 150 workers out of a job.

The CDC and economic development committees offered incentives that included cutting the rent for a Blue Creek Road building in half, canceling the lease on the company's Divide Street auxiliary storage building, letting the company pay no rent on a separate $7,000 per month lease and offering job retention incentives of $500 per full-time job up to a total of $75,000 per year for the next two years, starting April 5 and paid out every six months. The company had to keep a minimum of 75 jobs to receive that incentive, and did so.

New ICM incentives

On Feb. 19, the CDC granted the locally-owned company a $25,000, two-year forgivable loan to buy equipment needed to create flame-resistant coveralls used by refinery, utility and other industrial workers. As well, the CDC agreed to grant job-creation incentives of $500 per job, to a maximum of $10,000, based on the company retaining at least 110 jobs. New ICM at that time employed about 100 workers.

Coverall production allows the company to keep its current workforce during what is normally a slow period.

The new product line has been held back somewhat due to a shortage of raw material caused by the U.S. war effort in the Middle East. That has led to production inefficiencies and delays, but the company was still able to maintain the increased workforce.

CDC moves to Northside

The CDC moved into the Northside Education Center Nov. 1 on a six-month trial contract.

CDC and Northside have complimentary missions, one creating jobs, the other training workers, and moving to the center rent-free comes in exchange for CDC staff answering phones and opening the building during regular weekday hours.

The distance-learning center, opened on the refurbished grounds of the original El Campo High School at 707 Fahrenthold, is home to several adult education programs. The CDC gives $30,000 per year to the center to help workers land good jobs, hone their office and customer service skills, and brush up on computer programs.

The CDC had shared space with the El Campo Chamber of Commerce & Agriculture in a city-owned building at Washington and East Jackson streets. That costs the CDC an average of $682 per month for its share of utilities.

Industrial Park Developments

After first turning down the project, the threat of a lawsuit caused the city in February to decide to allow Forest Oil Corp. to drill a gas well in Miesel Industrial Park.

The CDC does not hold the mineral rights to the 64-acre park, which was completed in 1999.

Forest took about a month from start to finish for its operation at the park. The company took out a $20,000 bond to cover any damage, which did not occur.

Also in the Miesel Park, the Engineered Particle Systems' building on Stubbs Drive is put on the market in September.

EPS wanted to use recycled tires to make a strengthening compound for paints and epoxies, but couldn't find a market.

EPS President Wayne Rodrigue and Vice President Bill Stanton approached the city in 2003 and received an estimated $55,000 in land to build a facility for their business. The company told city officials it could create 150 to 200 jobs, but staffing at the building never topped two after the plant became operational in January 2005.

The 6,000-square-foot building and land belong to the company.

Texas Biodiesel lawsuit

In late November a district judge ruled in favor of the CDC's lawsuit to recover a $215,000 loan made to a biodiesel promoter.

District Judge Ben Hardin signed off on City Attorney Ronny Collins' motion for summary judgment.

In the ruling, Hardin ordered Texas Biodiesel; John Autrey,

80131601.BJPS 1/3/08 11:32 company president; and Lori

Lato, a Texas Biodiesel vice president to repay the entire loan plus $15,000 in Collins' attorney's fees and $585 in court costs. He added interest of 7.75 percent per year until the total is paid, and included attorney's fees' provisions in case Texas Biodiesel appeals the case.

Lato and Autrey co-signed the loan agreement, personally guaranteeing it would be repaid, so there's some hope of collecting at least some of the money owed.

The oft-delayed multi-million dollar Texas Biodiesel project, which first came before the CDC in August 2003, was granted a $165,000 forgivable CDC loan. The El Campo Economic Development Corp. - a privately funded, local business advocacy group - kicked in an additional $50,000.

Former CDC head sues

The former head of the CDC, who resigned Sept. 11, 2006,

filed an age discrimination lawsuit AM Page 1 in September of 2007.

Earl Joy was hired as the CDC's chief in July 2002. He resigned following his annual evaluation.

He requested unemployment compensation from the Texas Workforce Commission, but was denied. In the lawsuit, Joy restated grievances contained in his initial complaint: that the make-up of the board changed and "essentially consisted of individuals that were significantly younger than I."

Joy, who also sued his previous employer for wrongful termination, filed suit Sept. 7 in the 329th District Court in Wharton against both the CDC and the city of El Campo.