Brewing up local business in Sisters

The Sisters City Council was in rare unanimous agreement Thursday night in their support of a proposed expansion of Three Creeks Brewery's brewing operation in the Three Sisters Business Park. They were also in unanimous favor of providing incentives to keep the brewery expansion in Sisters.

The only point of disagreement was on whether to put a time limit on the terms of a proposed sewer fee reduction -and that determined the shape of the final vote.

After a contentious discussion between councilors, punctuated by unchecked grumbling and clapping from the audience, the proposal was approved on a 3-2 vote with councilors Lon Kellstrom, David Asson and Pat Thompson in favor and Wendy Holzman and Sharlene Weed dissenting.

The proposed agreement includes a 30 percent reduction in sewer fees up to a maximum of $10,000. Unlike the other incentives gained by building the new brewing facility within the Redmond-Sisters enterprise zone, this incentive has no end date.

Holzman, Weed and long-time city budget committee member and chair Gwen Chapman spoke of their concern with the lack of any "sunset" to the sewer fee reduction. They also cited city attorney Steve Bryant's written finding expressing "strong concern" over the lack of a sunset clause.

The three also expressed their concern with the lack of time to review the final document, and the lack of any full council discussion on alternative terms or sources for the incentive.

Despite the fact that the city staff had been working with Economic Development Manager Mac Hay and Three Creeks owner Wade Underwood for over five months according to Hay, the official nine-page agreement was only provided to council members the day before the meeting.

Chapman testified that, "This is a very significant obligation that we are putting on our sewer ratepayers in the future. It was only posted yesterday, and that is not enough time.

"There are a lot of incentives that come with the enterprise zones, and I think they are great. My concern is the perpetual reduction in the sewer rate."

The agreement is a key piece in Three Creeks Brewing Co. owner Wade Underwood's plans to brew beer in Sisters for retail sale outside the area.

"We wanted the answer to the ultimate question in relation to our desire for expansion ... prior to moving forward ," he said. "Is the utility backbone of the community capable of supporting a production brewing facility?

"Many of you have watched what is going on in other locations as it relates to breweries and wastewater," continued Underwood. "We did not want to be involved in those conversations. Great work by the city staff... (will allow) us to grow production right here in Sisters Country."

Weed explained her reservations.

"As I indicated to Wade, I am totally excited about this brewery going in... I am ready to help," she said. "Incentives are just that: to help a business be successful, then once they are successful then we get our (payment) back. The memo from our city attorney said he has a strong recommendation to not enter into an agreement that has no termination date."

In the ongoing discussion Holzman said, "I support your business expansion but I think we also need a full council discussion on the lack of the termination date on the benefits."

Councilor David Asson at one point interrupted with the query: "...how about 50 years?" regarding her request for the consideration of a termination date for the discount.

Local real estate developer and owner of RE/MAX Revolution, Peter Storton was the principal developer of the industrial park. He spoke in favor of approval of the agreement.

"I was the principal years back when we brought Three Sisters Business Park into the city. It was an arduous process ... there were extensive costs ... and now there is only one user, Bird Guard," Storton said. "The first four plats sold for $9 per foot average; now we can't get $3 per foot. We are in a real estate recession.

"We are competing with Redmond, Prineville, Bend to do something in that industrial park," said Storton. "Nothing is happening. What happens when things are bad is you give incentives to get somebody to come to the community and make a long-term expensive investment and hope it is going to work out. You do it for one, and as time goes by and you get it back from the original person, and the businesses that will join them.

"We have no business letting someone else get away from this town that has been successful."

Underwood proposed developing the brewing facility in three phases, with the first phase being a plant of 8,000 to 10,000 square feet, producing 3,000 barrels annually and employing three to five people.