7. EDSR 08-08-2011Ji
Elk REQUEST FOR ACTION
River
TO ITEM NUMBER
Economic Develo ment Authori 7 ,
AGENDA SECTION MEETING DATE PREPARED BY
8 August 2011 Annie Deckert, Director of Economic
Develo ment
ITEM DESCRIPTION REVIEWED By
Consider hiring Assistant Director of Economic Development Bob Thistle, Interim City
Administrator
REVIEWED BY
ACTION REQUESTED
Staff recommends hiring Clay Wilfahrt as the Assistant Director of Economic Development
BACKGROUND/DISCUSSION
On June 6, 2011, the City Council authorized moving forward with the hiring process for the Assistant
Economic Development Director position. At the June 13`'' EDA meeting, the EDA directed staff to
look into the EDA's involvement in the hiring process of the Assistant Economic Development
Director. In speaking with attorney Jenny Boulton, Kennedy Graven, Ms. Boulton indicated the EDA
bylaws and state statute indicated the EDA could make the final decision when hiring economic
development staff.
At the July 11, 2011 meeting, the EDA requested staff to further research the matter and return to the
EDA with a written summary from Ms. Boulton. Since then, Ms. Boulton and City Attorney Peter Beck
have concluded the City Council has the authority to make the final decision when hiring City staff.
Because the EDA is staffed by City employees, the City Council is the only entity with the authority to
hire City employees.
A staff interview committee recently completed interviews consisting of seven candidates out of 27
applicants for the position. The committee consisted of the Director of Economic Development, City
Engineer and Human Resources Representative.
The interview committee recommends hiring Clay Wilfahrt as the Assistant Director of Economic
Development. Mr. Wilfahrt has accepted, upon Council approval, starting at Pay Grade 8, Step A. Mr.
Wilfahrt graduated from St. John's University with a Bachelor of Axts in Political Science and has
completed courses at the graduate level in the Local Government Management Program at the U of M
Mankato. He is currently to Director of Economic Development for the Hartford South Dakota Area
Development Commission and gives direction to a Board of Directors and four committees. He has
experience implementing social media, marketing and material creation for government entities, retail and
industrial recruitment, grant writing and sits on a County Economic Development Authority which
administers a revolving loan program. Staff will work with Mr. Wilfahrt to determine start date.
Staff is seeking EDA approval to move forward with hiring Clay Wilfahrt as the Assistant Director of
N:\Departments\Community Development\Economic Development\ED Admin\Assistant\8-8-11 Action Requested- EDA.doc
Economic Development. Provided EDA recommendation, the City Council will be asked to make the
final recommendation at their August 8`" meeting.
ATTACHMENTS
^ Memo dated 7-27-11 from Jenny Boulton, Kennedy and Graven
^ Memo dated 8-3-11 from Peter Beck, Gray Plant Mooty
Action Motion by Second by Vote
Follow Up
N:\Departments\Community Development\Economic Development\ED Admin\Assistant\8-8-11 Action Requested- EDA.doc
Offices in 470 U.S. Bank Plaza
Kenned y 200 South Sixth Street
Minneapolis Minneapolis MN 55402
Saint Paul (612) 337-9300 telephone
Graven (612) 337-9310 fax
St. Cloud w'w'H'~kennedy-graven.com
CHARTERED Affirmative Action Equal Opportunity Employer
MEMORANDUM
TO: Board of Commission ers of the Economic Development Authority of the City of
Elk River, Minnesota
FROM: Jenny Boulton, Kennedy and Graven, Chartered
DATE: July 27, 2011
RE: Employment of EDA Staff
The City Council of the City of Elk River and the Board of Commissioners of the
Economic Development Authority of the City of Elk River, Minnesota (the "EDA") have
requested guidance regarding which entity has the authority and responsibility for hiring staff for
the EDA.
1. Back round.- Minnesota Statutes, Section 469.097, Subdivision 1 provides that
an "economic development authority may employ an executive director, a chief engineer, other
technical experts and agents, and other employees as it may require, and determine their duties,
qualifications, and compensation." Section 5 of the enabling resolution establishing the EDA
adopted by the City Council on October 7, 1987 grants essentially the same authority and states
the "Authority may employ an executive director and such other employees as it may require,
and determine their. duties, qualifications, and compensation." Section 3.4 of the EDA's bylaws
uses language substantially similar to the enabling resolution and states the. "Authority shall
appoint an Executive Director and such other staff as it may require, and determine their duties,
qualifications, and compensation." Minnesota Statutes, Section 469.100, Subdivision 2 requires
that the EDA annually submit a budget to the City Council and staff compensation is an item that
would need to be included in the budget.
2. Discussion. In Elk River, the law, enabling resolution and bylaws are consistent
in delegating the authority to hire EDA staff to the EDA. However, that delegation is subject to
approval of compensation for such employees as part of the EDA's budget. Because the budget
is subject to annual review, the City Council. has regular input in deciding the best approach to
hiring staff.
While Minnesota law provides economic development authorities the power to make
staffing decisions and in most cities the enabling resolutions and bylaws recite the statutory
language in much the same way as is the case in Elk River, it is not uncommon for cities in
Minnesota to provide staff to support their economic development authorities. This may be for a
variety of reasons such as efficiencies in providing employee benefits, an existing human
resources department equipped to conduct an employment search, or a job description which
includes both city and EDA duties. If the staff supporting the EDA are in fact employees of the
389616v1 JSB EL185-13
City, the City Council should approve their employment in a manner consistent with other
employees of the City.
Because of the relationship between cities and their economic development authorities, it
makes sense for the two entities to work collaboratively in making staffing decisions.
Ultimately, one of those entities has to take the lead role and in Elk River that role appears to
have been delegated to the EDA.
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MEMORANDUM
TO: Bob Thistle
Interim City Administrator
Annie Deckert
Director of Economic Development
FROM: Peter Beck
City Attorney
DATE: August 3, 2011
RE: EDA Staff
This Memorandum is in response to your request for my opinion as to whether the
EDA. or the City Council has the authority to hire EDA staff.
The City of Elk River EDA was established on October 7, 1987 by adoption of
City Council Resolution No. 87-63, the EDA "Enabling Resolution". The Enabling
Resolution provides, consistent with Minnesota Statutes Sec. 469.097, Subd. 1, that the
EDA "may employ an executive director ... and other employees". The EDA is,
therefore, authorized to hire an executive director and staff.
However, in Elk River, as in many communities which have established an EDA,
the EDA is staffed by City employees. The City Council is the only entity with the
authority to hire City employees.
Therefore, if the City desires to follow its past practice and staff the EDA with
City employees, hiring decisions regarding those employees will have to be approved by
the City Council.
If there is a concern regarding the Enabling Resolution, the Minnesota Court of
Appeals recently confirmed that the City Council has extensive discretion to limit an
EDA's powers, and may modify an Enabling Resolution at any time. (See Eagan
Economic Development Authority v U-Haul Co. of Minnesota, 765 NW 2"d 403 (Minn.
App. 2009) (Reversed on other grounds, 787 NW 2°d 529 (Minn. 2010).) Therefore, the
Elk River Enabling Resolution, Resolution No. 87-63, could be modified by the City
Council at any time to clarify that EDA staff will be City employees and subject to the
same hiring procedures as all other City employees.
Please let me know if you have any other questions.
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