Agenda 05/26/2015 Item #11C 5/26/2015 11.C.
EXECUTIVE SUMMARY
Recommendation to approve an agreement between Collier County and Arthrex under the
Capital Investment for Diversification Incentive ("CID") Program providing a grant in support of
Arthrex's planned 55,027 square foot medical device finishing facility at Ave Maria. This
Agreement provides for a grant in an amount of up to $164,613.82 paid over a four year term as
an inducement equivalent to the payment made for commercial impact fees.
OBJECTIVE: Approval by the Board of County Commissioners(Board)of an agreement between the
County and Arthrex,in support of and in encouragement of the advanced medical device manufacturing
activities occurring at the company's facilities at Ave Maria.
CONSIDERATIONS: The planned 55,027 square foot finishing facility is consistent with the County's
economic development goals for facilitating Targeted Industries in Collier County. The agreement
stipulates that Arthrex pay the required impact fees related to the project and that the County provides a
grant award in equal installments over four years equivalent in value to the amount of impact fees paid.
The agreement is contingent upon the company's continual operation of the facility as a medical device
finishing facility,remaining current on all local taxes,and Arthrex's demonstrating the provision of at
least 50 percent of its finishing facility employee's cost of health care coverage. Structured as a CID
(compliance is required before payment),this agreement ensures the County's exposure and risk is
minimized.
FISCAL IMPACT: The maximum cost to the County for this inducement grant is$164,613.82. The
incentive will be paid over four years($41,153.45 annually)for this Targeted Industry Economic
Development Project. Sufficient funding exists in the Economic Development budget(001-138763)for
the agreement.
GROWTH MANAGEMENT IMPACT:The recommended action supports the goals and objectives of the
Economic Development Element of the adopted Collier County Growth Management Plan.
LEGAL CONSIDERATIONS: This item has been reviewed by the County Attorney,and subject to the Board
approving the Office of Business and Economic Development's proposed revision to Collier County's Capital
Investment for Diversification Incentive(CIDS)Program,which item is also on this agenda,is approved as to
form and legality. This item requires majority vote for approval. -JAK
RECOMMENDATION: Recommendation to approve an agreement between Collier County and
Arthrex under the Capital Investment for Diversification Incentive("CID")Program providing a grant in
support of Arthrex's planned 55,027 square foot medical device fmishing facility at Ave Maria. This
Agreement provides for a grant in an amount of up to $164,613.82 paid over a four year term as an
inducement equivalent to the payment made for commercial impact fees.
Prepared by: Bruce Register,Director,Office of Business&Economic Development
Attachments: Agreement with Arthrex
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5/26/2015 11 .C.
COLLIER COUNTY
Board of County Commissioners
Item Number: 11.11.C.
Item Summary: Recommendation to approve an agreement between Collier County and
Arthrex under the Capital Investment for Diversification Incentive ("CID") Program providing a
grant in support of Arthrex's planned 55,027 square foot medical device finishing facility at Ave
Maria. This Agreement provides for a grant in an amount of up to $164,613.82 paid over a four
year term as an inducement equivalent to the payment made for commercial impact fees.
(Bruce Register, Office of Business and Economic Development Division Director)
Meeting Date: 5/26/2015
Prepared By
Name: JenniferLeslie
Title:Administrative Assistant, Office of Business &Economic Development
5/18/2015 3:31:58 PM
Submitted by
Title: Division Director-Business &Econ Dev, Office of Business&Economic Development
Name: RegisterBruce
5/18/2015 3:32:00 PM
Approved By
Name: KlatzkowJeff
Title: County Attorney,
Date: 5/18/2015 4:43:55 PM
Name: KlatzkowJeff
Title: County Attorney,
Date: 5/18/2015 4:51:41 PM
Name: IsacksonMark
Title: Division Director-Corp Fin&Mgmt Svc, Office of Management&Budget
Date: 5/19/2015 8:40:12 AM
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5/26/2015 11 .C.
Name: OchsLeo
Title: County Manager, County Managers Office
Date: 5/19/2015 12:00:00 PM
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Prepared by:
Jeffrey A.Klatzkow
County Attorney
3299 Tamiami Trail East,Suite 800
Naples,FL 34112
CAPITAL INVESTMENT FOR DIVERSIFICATION INCENTIVE PROGRAM
AGREEMENT
This Agreement for Capital Investment For Diversification Incentive ("CID") Program
(hereinafter referred to as "Agreement") is entered into this 26t1' day of May, 2015, by and
between Collier County, a political subdivision of the State of Florida, through its Board of
County Commissioners (hereinafter referred to as the "County"), and Arthrex, Inc. and Arthrex
Manufacturing, Inc. (hereinafter jointly referred to as"Arthrex").
RECITALS:
WHEREAS, Collier County enjoys broad Home Rule Powers, which include the
authority to enter into agreements to enhance economic development within the County; and
WHEREAS, Florida Statute Sec. 125.045 expressly provides that "The governing body
of a county may expend public funds to attract and retain business enterprises, and the use of
public funds toward the achievement of such economic development goals constitutes a public
purpose. The provisions of this chapter which confer powers and duties on the governing body of
a county, including any powers not specifically prohibited by law which can be exercised by the
governing body of a county, must be liberally construed in order to effectively carry out the
purposes of this section;" and further that"it constitutes a public purpose to expend public funds
for economic development activities, including, but not limited to, developing or improving local
infrastructure, issuing bonds to finance or refinance the cost of capital projects for industrial or
manufacturing plants, leasing or conveying real property, and making grants to private
enterprises for the expansion of businesses existing in the community or the attraction of new
businesses to the community;"and
WHEREAS, Collier County created the Capital Investment For Diversification Incentive
("CID") Program on March 24, 2015, the objective of which is to advance Collier County's
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economy by encouraging development of facilities, space and suitable land for targeted
businesses; and
WHEREAS, Arthrex has proposed a project consisting of(1) the planning, designing,
development, construction and equipping of a 55,027 square foot finishing facility built on real
property in Collier County, Florida, owned or controlled by Arthrex, a portion of which will
qualify for approval by the United States Food and Drug Administration for the manufacture and
packaging of medical devices as defined by North American Industry Classification System,
2012 (NAICS) Number 339113, and (2) a finishing facility to augment the medical device
manufacturing facility at Ave Maria, planned to consist of 55,027 square feet construction of
new production space situated adjacent and to the north of the current existing facility. The
project's operation and directly related employment will be in support of and complimentary
with a prior Collier County Job Creation Incentive Agreement with Arthrex for the existing
operation at Ave Maria which consists of approximately 150 total jobs and over 198,000 square
feet of high tech medical device manufacturing consistent with NAICS 339113; and
WHEREAS, Arthrex estimates that this Project will require it to expend approximately
$18.9 million in Capital Improvements, consisting $12.5 for construction, and $6.4 million for
tangible personal property; and
WHEREAS, the Board expressly finds that the opening of this facility and development
of the project will result in substantial economic benefits to the County, including but not limited
to the creation of high wage jobs and a net increase to the County's tax base; and
WHEREAS, Collier County estimates that the Impact Fee Liability associated with the
project is estimated at up to $164,613.82 and finds that this amount has been pre-paid; and
'WHEREAS, Collier County finds it is in the public interest to facilitate the growth of
Arthrex's Targeted Industry Business expansion as defined in F.S. 288.106 in Collier County and
provide support of Arthrex, with a grant in an amount equal to the value of the Impact Fee
Liability as provided by the CID Program.
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NOW, THEREFORE, in consideration of the foregoing Recitals, and other good and
valuable consideration, the receipt and sufficiency of which is hereby mutually acknowledged,
the Parties agree as follows:
1. The foregoing Recitals are true and correct and are incorporated by reference
herein.
2. The Board hereby agrees to enroll Arthrex into the CIDS Program, a copy of
which is attached and incorporated into this Agreement.
3. Collier County agrees to assist Arthrex with this Project by reimbursing Arthrex
the full amount of the Impact Fees incurred from this Project. Payment shall be in four equal
annual installments, subject to annual appropriation, in accordance with the CIDS Program.
4. Any failure by Arthrex to meet the terms and conditions of the CID Program will
be considered a substantial breach of this Agreement. Upon such breach, the County's repayment
requirement will automatically terminate, and neither party shall have any further obligation to
the other with respect to the matters set forth in this Agreement.
Legal Matters
5. Except as otherwise provided herein, this Agreement shall only be amended by
mutual written consent of the parties hereto or by their successors in interest.
6. This Agreement constitutes the entire agreement between the parties with respect
to the matters set forth herein and supersedes and takes the place of any and all previous
representations, undertakings, and agreements between the parties relating to this transaction.
This Agreement does not constitute a lien on the property, and cannot be assigned or transferred
by Arthrex without the prior written consent from the County. Nothing contained herein shall be
deemed or construed to create between or among any of the parties any joint venture or
partnership nor otherwise grant to one another the right, authority or power to bind any other
party hereto to any agreement whatsoever.
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IN WITNESS WHEREOF, the Parties have executed this Agreement on the date and
year first above written.
Attest:
DWIGHT E. BROCK, Clerk BOARD OF COUNTY COMMISSIONERS
COLLIER COUNTY, FLORIDA
By: By:
, Deputy Clerk Tim Nance, Chairman
Approved as to form and legality:
Jeffrey A. Klatzkow, County Attorney
AS TO ARTHREX, INC.,ARTHREX MANUFACTURING, INC.,
Signed, sealed and
Delivered in the presence of:
(A)cnifitk ,„ cu By: A -
nature J J f� S hmieding, Secreta ,Arthr- Inc.
jr ip e( owk) a d R- istered Agent, Art -x Man cturing, Inc.
Printed Name
014 AS. 4.1.0:441 " 474
.gnatur,e
Printed Name
STATE OF FLORIDA
COUNTY OF COLLIER
The foregoing Agreement was acknowledged before me this I Viday of May, 2015,by
John Schmieding, Secretary of Arthrex, Inc, and Registered Agent Arthrex Manufacturing, Inc.,
who is personally known to me or has produced as proof of identity.
[NOTARIAL SEAL] -r\O 464-
Signature of rson T&.king Acknowledgment
MARY GAY : ay
• - MY COMMISSION#EE841659
'.;'. •-t EXPIRES October 08,2016
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