Agenda - 06-21-2016 - 5-k - Contract Amendment to the Existing Interlocal Agreement between Orange County and the Town of Chapel Hill for the “LAUNCH Chapel Hill” Small Business Incubator

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5 companies move through the accelerator program the impact is increasing exponentially. Unfortunately we as a community are still losing many of these companies to our surrounding communities, Durham and Raleigh due to the fact that Chapel Hill does not have a co-working space (like 1871, American Underground or HQ Raleigh) UNC and Chapel Hill's Long-Term Vision The Chancellor's Office of Innovation and Entrepreneurship and the Center for Entrepreneurial Studies are working with the UNC Facilities Department, Campus Real Estate Office, and renowned Baltimore based architecture and planning firm Ayers Saint Gross to develop an Innovation Space Program and development strategies for a 150,000 square foot Innovation Center at the edge of campus as part of the 2016 University Master Plan. The Town and County are also key partners in this process. Ayers Saint Gross will be presenting to UNC's Board of Trustees within the next few months and the goal is to open this cutting edge space within the next 3 to 5 years. In the meantime, there is a need for space to support our growing businesses. Bridge While UNC is poised to develop an impressive 150,000 square foot innovation center within the next 3 -5 years, that we believe will have Launch Chapel Hill at its' heart, in the meantime the entrepreneurial ecosystem at UNC, Chapel Hill and Orange County continues to grow and we seek to continue to be a leader in the ecosystem. We have an opportunity to develop an additional 3700 square foot of space that can be leased to growing companies in the same building as our current facility. We are therefore proposing that the key partners in Launch support an expansion of space at our existing location to accommodate companies that complete the accelerator program. We currently lose some of our most promising companies to neighboring towns as Chapel Hill does not have an 1871 style co-working facility for companies as they graduate from the Launch accelerator program. We have just learned of an opportunity to add 3700 square foot of space in our existing building at a highly attractive rental rate ($14 per square foot plus CAM). We have outlined below the total cost over 3 years of adding this space. Much of the cost is at the outset to up-fit and furnish the space. Going forward the vast majority of operating expenses including staffing will be covered by rents from the tenant companies, as a result we have only shown the differential that we would look to the partners to support. The total cost is approximately$101,500.00 per year or$304,500.00 total over 3 years. On Monday afternoon we presented a proposal to the Becker family requesting their support at$25,500.00 per year. We have been told to expect a response in the next two weeks. Given the urgency and the benefit to the Town of Chapel Hill, Orange County and the University of North Carolina we are herewith requesting that the County as well as the Town and UNC support at $33,500.00 per year for up to 3 years, or$101,500.00 each over the next 3 years. The Town of Chapel Hill has now incorporated the $33,500 of annual funding into their budget. Today the UNC Chancellor's Budget Committee reviewed the $33,500 per year request and were advised by the provost it looks promising. You should hear something official very soon." If the Becker family also responds favorably to our funding request we could together determine whether to reduce the Town, County and UNC commitments or to simply extend the term covered by the commitment. Thank you for your consideration.