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12-19-2016 EDA MIN City of Meeting of the Elk River River Economic Development Authority Held at the Elk River City Hall Monday, December 19, 2016 Members Present: President Tveite,Commissioners Burandt, Ovall,Westgaard,Provo, Olsen, and Wagner Members Absent: None Staff Present: Economic Development Director Amanda Othoudt,Economic Development Specialist Colleen Eddy,and City Clerk Tina Allard I. Call Meeting to Order Pursuant to due call and notice thereof,the meeting of the Elk River Economic Development Authority was called to order at 5:32 p.m. by President Tveite. 2. Consider 12/19/2016 Agenda Chair Tveite added an announcement to Item 7. Ms. Othoudt stated Item 3.5 should read Subordination Agreement. Moved by Commissioner Burandt and seconded by Commissioner Olsen to approve the December 19,2016, agenda as amended. Motion carried 7-0. 3. Consider Consent Agenda Moved by Commissioner Wagner and seconded by Commissioner Westgaard to approve the following consent agenda: 3.1 October 17,2016, EDA Minutes. 3.2 Check register as outlined in the staff report. 3.3 Balance sheet as outlined in the staff report. 3.4 Revenue/expenditure report as outlined in the staff report. 3.5 Resolution 16-08 approving mortgage subordination Agreement for Yankee Doodle Enterprises Motion carried 7-0. 4. Open Forum No one appeared for Open Forum. 5. Public Hearings Economic Development Authority Minutes Page 2 December 19,2016 There were no public hearing items scheduled for this agenda. 6.1 Industrial Incentive Microloan Application for Heritage Millwork, Inc. Ms. Othoudt presented the staff report. Chair Tveite discussed the finance committee's review of the application. Commissioner Wagner stated she hopes to see Heritage move their entire business to Elk River in the future. Moved by Commissioner Provo and seconded by Commissioner Olsen to approve a$100,000 Industrial Microloan to Heritage Millwork,Inc. and authorize the President and Executive Director to execute the loan agreement and any loan documents to which the EDA is a party on. Motion carried 7-0. 6.2 City Beautification Subcommittee Ms. Othoudt presented the staff report. Moved by Commissioner Westgaard and seconded by Commissioner Wagner to create an EDA City Beautification Subcommittee as outlined in the staff report. Motion carried 7-0. Moved by Commissioner Westgaard and seconded by Commissioner Burandt to amend the EDA bylaws. Motion carried 7-0. 6.3 Director's Report Ms. Othoudt presented the staff report. Chair Tveite congratulated Ms. Othoudt on her Economic Development Finance Profession Certification. 7. Announcements Chair Tveite noted this meeting is Commissioner's Burandt last and expressed his thanks for her contributions. Commissioners thanked Burandt for her service on the EDA. Commissioner Provo stated he was asked to remove himself from the worksession discussion,at the recommendation of the city EDA attorney due to a conflict of interest regarding Spectrum School. He expressed concerns with the property Y value of his business decreasing so he consulted with his own attorney who told him it wasn't a rigivAk Economic Development Authority Minutes Page 3 December 19,2016 conflict of interest. Commissioner Provo stated he wants to participate in the discussion and if the city doesn't want him to,then he wants a reason why stated on the record. He stated he doesn't stand to gain anything from the decision made regarding the Spectrum property discussion. Attorney Beck stated the conflict of interest advice was provided by EDA attorney,Jenny Bolton. He reviewed her email and concurs with her analysis. He discussed two points: 1) the email states Commissioner Provo has personal interest in the outcome of the decision as a result of owning adjacent property;2) Commissioner Provo should leave the room or step down from the dais and abstain from any discussion or vote regarding the Spectrum School property.Attorney Beck further commented he doesn't know how Commissioner Provo's attorney interpreted the law to reach his conclusion. Commissioner Provo stated the city should state on record that the reason for the conflict of interest is because of the city considering moving Spectrum adjacent to his property which can potentially reduce the property value of his property. Attorney Beck stated each commissioner should make their own decision on whether to follow the advice of the city attorney. Commissioner Provo stated he will not remove himself from the Spectrum discussion and will participate at his own request. The EDA recessed at 5:55 pm. and reconvened in worksession at 6:02 p.m. p p 8.1 Interview for Open EDA Finance Committee Seat Ms. Othoudt presented the staff report. The EDA interviewed Jim Gromberg for the EDA Finance Committee. Mr. Gromberg discussed his past experience. Tim Dolan,resident,expressed conflict of interest concerns due to Mr. Grombergs work with WSB Consulting,stating he does for-profit work in other surrounding communities and questioned where his loyalty would fall. Commissioner Westgaard stated if conflict of interest situations arise,the EDA would expect Mr. Gromberg to disclose them and recuse himself from the discussion. Chair Tveite stated the finance committee is very diligent about the conflict of interest laws and can have conflicts at various times with the bankers or realtors on the committee. Mr. Gromberg noted this is a technical committee that reviews financials. Chair Tveite further noted the committee is advisory and makes recommendations to the EDA. P O I I I I I I IT NATURE Economic Development Authority Minutes Page 4 December 19,2016 Moved by Commissioner Westgaard and seconded by Commissioner Ovall to appoint Jim Gromberg to the EDA Finance Committee. Motion carried 7-0. 8.2 EDA Property for Spectrum Ms. Othoudt presented the staff report. She stated institutional uses are currently allowed in the business park zoning district. She stated Spectrum could purchase the city-owned parcel and it could be converted into a Planned Unit Development. The institutional use could then be removed from the business park zoning district. Commissioner Westgaard noted a school is an allowed conditional use in the business park and currently,at any time, Spectrum could purchase the city-owned parcel and set up a school. Councilmember Westgaard questioned at what point the city maintains an industrial or business park,due to Spectrums growth. He stated the two industrial parcels would be put back on the tax rolls but the city would still be taking the other two business park parcels off the tax rolls. He stated there will still be issues with school uses mixed with industrial/business uses. He stated,ideally,we need to find a home somewhere else for the school. Ms. Othoudt stated the city owned parcel is very difficult to market to manufacturers due to its shape and easements. She noted they have worked with surrounding companies to try and redevelop the city-owned site for potential expansion opportunities,but it has been difficult. Commissioner Provo disagreed with Ms. Othoudt's comments. He stated the parcels could be reshaped to fit a business. Commissioner Westgaard questioned if Spectrum would develop the city-owned parcel differently than a business. Mr. Carlton stated the school has different needs than a business because they require more open space,parking,playing fields,and don't need as large of a footprint for a building. Commissioner Provo questioned if there is anywhere else in town for the school. Some options were discussed,but didn't seem viable. Commissioner Westgaard further questioned how the traffic patterns would work in the area. Mr. Carlton explained the parking,right-in,right-out access, and circulation on their own property. Commissioner Provo questioned if the surrounding businesses were contacted for feedback. P O 11E1E1 111 NATURE Economic Development Authority Minutes Page 5 December 19,2016 Ms. Othoudt noted this is only a very preliminary discussion to gauge commission reaction. She further stated,in regards to property value, the county assessor says there is evidence to show the school will not devalue surrounding properties. She provided the example of the Coin-Tainer property. Commissioner Provo discussed the Morrell Companies move from the School Street area due to concerns with his business near schools. Chair Tveite stated some good points have been laid out. He complimented staff on trying to find a creative way to assist Spectrum on a challenging parcel. He stated the issues are zoning, easements,access, and whether this is what the school desires;noting they are going to outgrow these locations in a short time. Commissioner Provo stated if the EDA property is available, then other city-owned property should be considered such as parks or the golf course. He stated everyone should be willing to help find Spectrum the best location. Commissioner Westgaard noted to Commissioner Provo that the objective is to lend the resources of the economic development department,who know all the assets available throughout the community,and would help Sepctrm long-term. He further stated we need to find the best fit for everyone. Commissioner Provo expressed further concerns with the school being located in two different parks. i us industrial/b arks. Ms. Othoudt stated the ultimate long-term goal is to try and get the school on one campus. Commissioner Wagner concurred with Commissioner Westgaard's comments at tonight's meeting. Commissioner Burandt concurred and would like the city to continue to help the school with finding other locations. 9. Adjournment There being no further business,Chair Tveite adjourned the meeting of the Elk River Economic Development Authority at 6:55 p.m. Dan Tveite,EDA ' ►-sident Tina A7City Clerk rrTEflEP 8 1 NATURE