04-30-2024 JFC MIN
Special Meeting of the Elk River
Joint Finance Committee
Held at Elk River City Hall
Tuesday, April 30, 2024
Members Present: Charlie Blesener, Ryan Hardin, Jim Gromberg, Chad Vitzthum, Dan Tveite, Tony
Sofio, Rhonda Magnussen (7:34 a.m.), and Nate Ovall (8:12 a.m.)
Members Absent: Lynn Caswell
Staff Present: Economic Development Director Brent O’Neil and Economic Development
Specialist Joshua Mollan
Others Present: Pat Menth – Heritage Millwork (HMI), Dave Menth – Heritage Millwork, Annie
Deckert – All Day Companies, and Mikaela Huot – Baker Tilly
1. Call Meeting to Order
Pursuant to due call and notice thereof, the meeting of the Elk River Joint Finance Committee was
called to order at 7:33 a.m. by Chair Tveite.
2. Consider Agenda
Moved by Blesener and seconded by Gromberg to approve the agenda. Motion carried 5-0.
3. Consent Agenda
Moved by Hardin and seconded by Gromberg to approve the August 29, 2023, meeting
minutes. Motion carried 5-0.
(Rhonda Magnussen joined at 7:34 a.m.)
4.1 Appoint New Member
Mr. O’Neil presented the staff report.
Sofio introduced himself to the committee.
Moved by Vitzthum and seconded by Hardin to approve the appointment of Tony Sofio to
the Joint Finance Committee. Motion carried 6-0.
4.2 Heritage Millwork Project (HMI) and Incentive Applications
Mr. O’Neil presented the staff report.
Pat and Dave Menth introduced themselves and the project to the committee.
Ms. Huot presented Baker Tilly’s financial analysis on the $1,375,000 land write down on 14 acres of
city owned land. Ms. Huot advised that the developer stated that without assistance being provided
upfront through a land write down, the project would not be viable due to the following factors:
Using equity to pay for upfront land costs would impact HMI’s working capital.
Bank would require higher equity investment from PLM Properties if upfront assistance
were not provided.
Limitations on the level of bank financing the project can secure due to the size of the
capital investment and project.
Ms. Huot shared that after Baker Tilly’s analysis, upfront assistance with the support of TIF would
be necessary for this project to proceed as proposed.
Mr. O’Neil advised that the Council will consider interest rates of the TIF at their upcoming
meeting.
Pat Menth advised that they would be interested in starting the phase two expansion in three to five
years.
Moved by Blesener and seconded by Gromberg to approve the recommendation to the EDA
and City Council on the utilization of TIF for Heritage Millwork. Motion carried 6-0. Chad
Vitzthum abstained.
Mr. O’Neil advised that Chad Vitzthum has had a past banking relationship with HMI and this
project and may be considered a non-interested party in this discussion.
(Nate Ovall joined at 8:12 a.m.)
The committee discussed potential interest rates for the TIF.
4.3 Open Discussion
Mr. O’Neil asked if the committee would be able to meet outside of the regularly scheduled meeting
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to discuss HMI’s loan request prior to the May 20 EDA meeting.
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The committee was in favor of meeting again on Tuesday, May 14 at 7:30 a.m.
Mr. O’Neil asked the committee for their feedback on the interest rate that is set forth on the policy:
3% or 2% below prime, whichever is higher. Staff’s loan discussions with HMI have been built
around a 3% interest rate.
The committee was in favor of supporting a 3% interest rate.
5. Motion to Adjourn
Moved by Gromberg and seconded by Ovall to adjourn the special of the Joint Finance
Committee. Motion carried 8-0.
The meeting adjourned at 8:27 a.m.
Minutes prepared by Joshua Mollan.
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Brent O’Neil
Economic Development Director
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Tina Allard
City Clerk