Tuesday’s special meeting of the City Council had all the drama, potential and pitfalls of the reality-TV investment show “Shark Tank.”
Pitching the idea of a partnership between a nanotechnology company and the city were the “geeks” from Texas and Biloxi Mayor Andrew “FoFo” Gilich.
The “investors” — the seven council members — listened to the pitch, admittedly not fully understanding the high-tech presentation, but eager for the potential jobs and the possibility of attracting other high-tech firms to the city.
This “Shark Tank” has another interested party, though — the state legislature. The vote of the council had to be unanimous to ask state lawmakers for local and private legislation that will allow the city to even consider this partnership.
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The pitch came with slides and products to show the amazing capabilities of nanotechnology. Chris Lundberg, CEO of NanoRidge Materials in Houston, explained how NEETcoat can melt ice on sidewalks and to keep oil flowing through pipelines in cold conditions; how TeraCopper makes an air conditioner more efficient and dissipates heat in phones and laptops; and how NanoWire, another product made by his company, is stronger than copper wire but weighs less. Plug it in and teams up north can play soccer on their fields all year long, he said.
Glenn Palmer with NanoRidge said the future is cybersecurity. What his firm proposes for Biloxi to invest in is fingerprint-sensor technology to make credit cards and smartphones more secure.
Under Palmer’s proposal, Biloxi would create a nonprofit agency and the company would license the agency the patent for this technology and the knowledge to make it profitable.
Biloxi and other Coast cities frequently provide tax-increment financing bonds to help developers pay for infrastructure and give tax breaks as incentives to attract companies to their cities. This would go beyond that, said Gerald Blessey, special attorney for Biloxi. The city would:
▪ Form a nonprofit Biloxi Biometrics and Cybersecurity Center to sell the fingerprint sensors
▪ Build a 50,000-square-foot manufacturing plant for the company in Biloxi
▪ Apply for state and national grants for the company
▪ Possibly loan Biloxi Biometrics money
Biloxi set up a $4.2 million economic-development fund from the BP oil-spill settlement, Blessey said, and used a portion to pay down the city’s debt. A little more than $1 million still in the bank could be used for this project, he said.
Like the “Shark Tank” sharks, the council members had many questions and concerns.
“There’s a bunch of ifs and coulds, and it’s a huge risk in my opinion,” Councilman Robert Deming III said. He asked why the city couldn’t just build a manufacturing plant and lease it to the company rather than becoming venture capitalists with technology that could be insignificant tomorrow.
“It’s a scary proposition,” he said.
Councilman George Lawrence said this is dealing with taxpayers’ money and “no way I’m putting up taxpayers’ money and having no say-so.”
Blessey told the council, “Every step of this requires your approval. The mayor cannot act alone.”
Blessey admitted he doesn’t know if such a venture is legal in Mississippi, but said local and private legislation would make it clearer and the proposal could generate “enormous amounts of money” for the city.
“Why shouldn’t the taxpayers get a return on profits?” Blessey said.
Just how many jobs would be created and where the manufacturing plant would be built weren’t shared with the public but Lawrence asked for details such as the company’s profits last year.
Lundberg said the company is just getting started and made less than $1 million last year. Blessey said profit margins and other proprietary information will be revealed later in executive session.
Ultimately, all seven council members voted to ask for the local and private legislation, but Deming vowed to carefully weigh the project at every step.
This episode of “Shark Tank” now moves to the Capitol in Jackson, where the city plans to request action in the 2017 legislative session.