3.0. EDSR 08-23-1993 ELK RIVER ECONOMIC DEVELOPMENT AUTHORITY
i
TO: ECONOMICDEVELOPMENT AUTHORITY
FROM: WILLIAM RUBIN, ED COORDINATOF\'p
DATE: AUGUST 19, 1993 ' v
SUBJECT: REVIEW PROPOSAL TO AN INDUSTRIAL PROSPECT
INTRODUCTION
On August 10, 1993, a presentation was made to McLean Midwest,
a manufacturer of enclosed climate-control products. As a
result of this presentation, McLean desires a more definitive
estimate of the Elk River incentive package.
BACKGROUND
As Commissioners will recall, McLean seeks to construct a
100,000 to 120,000 square foot facility that is sited on a
parcel containing 20 acres . McLean is a subsidiary of Zero
Corporation, a publicly-traded company that reports fiscal year
1993 net sales in excess of $160,000,000 and a net income of
• $11 .6 million. Additional information on Zero Corporation is
attached to this memo.
Three sites were recommended to McLean Midwest during the
August 10 presentation. These sites included a parcel north of
the City' s maintenance shop, bounded by Elk Lake Road and the
abandoned railroad trail; another twenty acre parcel
immediately west of the fairgrounds; and a final parcel
immediately north of the Sandpiper Estates subdivision and ; east
of the County Government Center. The Elk Lake Road parcel has
utilities within close proximity; the other two parcels require
utility extensions.
Staff has since learned that McLean is leaning towards the
parcel adjacent to the fairgrounds . Staff has attempted to
estimate the eligible items and related costs associated with
this site. This is found in a draft of a letter Mayor Duitsman
would sign, assuming Council affirmation. These numbers should
hopefully help McLean as it sorts out the various incentive
packages from the other communities .
ACTION REQUESTED
Following a discussion on McLean and the Elk River incentives,
the EDA is asked to forward a recommendation to the City
•
Council regarding the specifics of the proposal pursuant to
Mayor Duitsman's letter.
P.O.Box 490 • 13065 Orono Parkway • Elk River, MN 55330-1743 • (612) 441-7420 • Fax: (612) 441-7425
Equal Opportunity Housing and Equal Opportunity Employment
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August 23, 1993
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Mr. Michael L. Wilber
McLean Midwest
4000 83rd Avenue North
BrooklynPark, MN 55443
RE: Incentive Proposal From the City of Elk River
Dear Mike:
As an expression of Elk River's interest in assisting McLean
Midwest with its expansion in our community, the City Council
wishes to affirm the availability of certain incentive
programs . This proposal was authorized by the City Council at
its August 23, 1993 meeting.
The City or its Economic Development Authority (EDA) will
provide Tax Increment Financing assistance to completely cover
the costs of the following items :
Eligible Items Estimated Costs
Land Acquisition (Pending)
(Land write down)
Environmental Analysis
(Phase I and/or Phase II-if necessary) $ 5,000
Soil Borings and Analysis $ 5,000
Civil and Survey; Plat $ 10,000
Streets $135,000
Water and Sewer Extensions
(Off site) Trunk $ 76,000
Lateral $ 32,500
Water and Sewer Extensions $ 25,000
(On site)
Other, Misc. Add 10%
• TOTAL $
P.O. Box 490 • 13065 Orono Parkway • Elk River, MN 55330 • (612) 441-7420 • Fax: (612) 441-7425
• This proposal results in McLean Midwest obtaining a site in Elk
River of approximately 20 acres with all utilities and streets
in and paid for, free of charge. The timeline to complete this
process was previously submitted to you and a copy is attached
to the proposal .
The Elk River proposal is further expanded to the include the
economic development rate offered by Elk River Municipal
Utilities pursuant to its letter of July 30, 1993 . Subject to
the specific details found in its proposal, the Municipal
Utilities has offered a five year, phased program to provide
McLean Midwest with a very competitive electrical rate.
This proposal to McLean Midwest is subject to the following:
- The filing of an application for Tax Increment Financing
assistance.
- The satisfactory analysis of McLean Midwest' s financial
background and related projections .
- The statutory limitations of the Tax Increment Financing
Act.
- The creation of a new economic development district
• pursuant to Minnesota Statutes.
On behalf of the Elk River City Council, I wish to thank you
for the opportunity to submit this proposal to McLean Midwest.
Please feel free to contact Pat Klaers, City Administrator, or
Bill Rubin, Economic Development Coordinator if you have any
questions or comments on the proposal.
Very truly yours,
Henry A. Duitsman
Mayor
- HAD:akh
Zero Corporation
ZERO CORPORATION HAS FACILITIES
IIITHROUGHOUT THE UNITED STATES AND
ZERO CORPORATION'S
IN EUROPE AND MEXICO, PROVIDING ITS OPERATING FACILITIES
DIVERSIFIED CUSTOMERS—OVER 18,000 ENGLAND, / "vi
41.,Air Cargo iquipment(UIQ i,�sa. -r• Fx:-
WORLDWIDE—WITH SUPERIOR QUALITY Middlesex,England "'r> trr=* r
Samuel Groves and Co
`"r":,- 6umIngham.England 1"°
AND SERVICE. THE COMPANY IS STRATE- t,x .t r.
GICALLY POSITIONED 4404} x {"�
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THROUGH INVESTMENTS � �',,� r I, (Zero East '"y Ct
-: I Zero Enclosures - f ,. -r r Monson,Massachusetts ; Le
North Salt Lake,Utah -: "'„'„-:-:;":;:e." 0
IN COMPLEMENTARY '._I NielsenHardwareQ.
I Electronic Solutions �" .. • '- "' 77♦"K 1<' �.y. ..,y-: w„y 4 •
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El Monte,California _.. <rp,- . -_
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PRODUCT LINES, Zero Cabinets ., . "
Pacoima,California �, `J:
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MODERN FACTORIES, Camarillo,Califomia(2locations) t . - b
Air Cargo Equipment - z - L
TECHNOLOGY, PEOPLE om
Ranch°DingueZ,Calit°mla(2l°`ati°ns) UNITED STATES 0
Electronic Solutions - - f.
San Diego,California - _ <.
AND ENVIRONMENTAL '`•
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MEXICO McLean Midwest +r -, -
' • SYSTEMS TO TAKE FULL I Brool yn Park,Minnesota
ADVANTAGE OF L s McLean Engineering
I Princeton Junction,New Jersey
PRESENT AND FUTURE 11
OPPORTUNITIES.
Zero Corporation is synonymous with excel-
lence in the engineering, manufacturing and
Air Cargo Equipment I marketing of cases, cabinets, cooling and
Tijuana,Mexico
cargo containers. It is one of the United States'
ti leading manufacturers of system packaging,
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specialized enclosures, cooling equipment and accessories primarily for the elec-
tronics industry. Zero is also the country's leading manufacturer of air cargo
containers and systems and, under the Zero Halliburton® brand name, produces a
--- premium line of aluminum luggage and attaché and carrying cases. Zero is
internationally known for expertise in deep draw technology andhas a significant
competitive advantage by being able to quickly satisfy customer needs with over
44,000 standard sizes of deep drawn enclosures.
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kik I Zero Corporation
REVENUE FROM MARKETS SERVED
0 Instrumentation/
Communications Data Processing/
Peripherals
30%
24%
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C,i Zero Corporation has seven major product
lines—Zero boxes, cases, luggage, cabinets, sys- Consumer/Other
N Government/
''' tern packaging, cooling and cargo containers. Military 16%
Airline/
LFor ease of memory, the product lines are some- 15% Airborne Cargo
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Z times referred to as the "four Cs" (short for 15%
cases, cabinets, cooling and cargo containers); the seven
product lines give Zero its marketplace leadership. All
product lines and business units are strategically interrelat- MARKETS SERVED
ed to serve the Company's numerous markets. Products are .- - -
• developed internally or added through acquisitions to serve C . Ods Oo �9 i,
Zero's global customer base. Each product line ranges from •<,f2�j to o �sG6 6°". °6
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standard designs to highly customized solutions. Zero is a /o°�o�°'GoA��c�ss% �Of� �Cd, �Gf
leading provider of prod- �s 'L °'mss 9� _ 90 d2
ucts within well-defined i a
• • • •
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niche markets and has over "% " ' .. L 5 ""`' - .d-
Cases DEEP DRAWN
18,000 customers world- ENCLOSURES Zero Enclosures Es • • •
wide. No single customer r CASES Zero Enclosures • • •
accounted for more than 5 +`� _ Zero East/
Nielsen Hardware • • • •
percent of Zero's total rev- � `
: "°,4t Samuel Groves • • • •
enue in 1993. l,� . ,
t ,' u r LUGGAGE Zero Enclosures • • • •
;Cabinets; CABINETS Electronic Solutions • • •
. W . - Zero Cabinets •` • •
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'`. Zero East • • •
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-..+ - SYSTEM
" {„,:•,..`. PACKAGING Electronic Solutions • • •
Cooling COOLING McLean Engineering • • •
McLean Midwest ® • •
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Cargo
Containers AIR CARGO
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Zero Corporation
Deep Drawn Enclosures
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With over 44,000 standard sizes of deep drawn enclosures, called "Zero
` boxes," and over 40 years of expertise and innovation, Zero is the leader
f in this technology. Enclosures are primarily drawn from aluminum.
Cases
Zero is the country's chief provider of highly specialized protective alu-
= �,.i minum cases, which are designed, engineered and manufactured to
�'ii°'7�; protect and endure. Cases are also offered in steel and plastic.
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Luggage t
The prestigious line of Zero Halliburton® aluminum luggage and attaché 0
and carrying cases is a worldwide favorite among seasoned business Cl.
4 travelers, professional photographers and sophisticates alike.
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Cabinets
• An extensive line of commercial, industrial and ruggedized cabinets
(standard and custom), coupled with over four decades of engineering
expertise, has added to Zero's leadership position in electronic packaging.
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System Packaging
Zero offers customized system packaging by engineering and integrating
b-- =� ' enclosures, backplanes, power supplies, cooling systems and other compo-
- ,.
nents. With over 20 years of experience, Zero is a leader in system packaging.
Cooling
`,t ''�jec.. A wide array of cooling and climate control products, ranging from motor-
N,-40,44141144 ized impellers and fan trays to electronically controlled air conditioners
and heat exchangers, makes Zero a leader in cooling electronics.
Air Cargo Containers and Systems
;; It �- Zero is the United States' premier designer, manufacturer and marketer of
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. ]:alis . air cargo containers and in plane baggage/cargo handling systems.
Cases Cabinets Cooling Cargo
"ZERO PROVIDES STATE-OF-THE-ART,
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• SOLUTIONS FOR COOLING ELECTRONIC
--
ENCLOSURES..IN THE 13 YEARS I'VE
WORKED WITH THEM, they have j
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never failed to meet my '
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cooling needs.". ��,''I •
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GRANT M. SMITH, Y
PRINCIPAL ENGINEER r )I 4-\ 0
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processor-controlled motorized impellers and fan trays to
. closed-loop air conditioners and heat exchangers, makes -- '- - _ — ,
Zero a leader in cooling electronics. For two decades,Zero,
under the McLean Engineering and McLean Midwest
names, has been a climate control innovator. Products include fans, centrifugal
blowers, cabinet-mounted packaged blowers, air conditioners, intelligent card cool-
ers and custom cooling systems engineered for a variety of environments ranging ,efir _
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from the factory floor to the operating room. A wide selection of standard products centrifugal •
blower
and accessories coupled with broad industry expertise,ongoing research and supe- r
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rior design, give Zero its competitive edge. A few of the complex systems cooled r
er ;
by Zero's products include fiber optics switching equipment, mainframe computers l;'
and disk drives, robotic controls, medical instrumentation and tool control panels.
Zero's impressive list of cooling customers includes AT&T, Hoffman, IBM, Northern
Telecom and Unisys. Al\IIntelligent �#-.[ .
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card coolers(
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