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06-14-1993 EDA MIN . . . MEETING OF THE ELK RIVER ECONOMIC DEVELOPMENT AUTHORITY HELD AT THE ELK RIVER CITY HALL MONDAY, JUNE 14, 1993 Members Present: President Gongoll, Commissioners Dwyer, Holmgren, Duitsman, Farber and Dietz (7:05 p.m.) Members Absent: commissioner Scheel Staff Present: Pat Klaers, Executive birector; Bill Rubin, Economic Development Coordinator; Sandra Thackeray, City Clerk 1. 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 7:00 p.m. by President Congoll. 2. Consider 6/14/93EDA Agenda Item *7., "Consider Underwriting a Retail Focus Group Study with the Downtown Development Corporation and Other Business people", was deleted. Items 14.1., "TIF Legislative Updates", 14.2., "Information on Local Industrial Expansion", and 14.3., "Information on star City Signs", were added to the agenda. COMMISSIONER HOLMGREN MOVED TO APPROVE THE 6/14/93 EDA AGENDA AS AMENDED. COMMISSIONER DWYER SECONDED THE MOTION. THE MOTION CARRIED 5-0. 3. Consider 5/10/93 and 5/25/93 EDA Minutes COMMISSIONER DUITSMAN MOVED TO APPROVE THE 5/10/93 EDA MINUTES AND THE 5/25/93 EDA MINUTES. COMMISSIONER HOLMCREN SECONDED THE MOTION. THE MOTION CARRIED 5-0. Commissioner Dietz arrived at this time (7 : 05 p.m.). 4 . Open Mike No one appeared for this item. 5. Financial Update Bill Rubin informed the EDA that the Revolving Loan Fund had a cash balance of $158,817.67 as of May 31, 1993. 6. EDA Main Street Site Chris Bulow, Bruce Company, provided the EDA with an update on progress he has made with his project since the last EDA meeting. He indicated that the project has remained virtually unchanged from the last EDA meeting, however, different forms of funding have been discussed. Mr. . . . Economic Development Authority Minutes June 14, 1993 page 2 Bulow indicated that funding ideas discussed included creation District, repayment of the TIF grant, and the possibility of co-developing the site with other unnamed developers. of a TIF the EDA Bill Rubin explained the co-development concept. He stated that the EDA could contribute the value of the property with the understanding that within a stated period of time, as the project develops and units are sold, the EDA would be cashed out of the project and would therefore recapture the value of the land. Bill Rubin informed the EDA that this could be an option in lieu of creating a TIF District. Commissioner Duitsman indicated he would not comment until he has received some type of written information on this concept. Chris Bulow requested that the EDA consider granting him some exclusive rights to the property. Bill Rubin informed the EDA resolution of some of the on the project. that the alley is still an issue and alley concerns could place time constraints COUNCILMEMBER HOLMGREN MOVED TO GRANT A 90 DAY COMPANY BEGINNING IMMEDIATELY AND ENDING COMMISSIONER DWYER SECONDED THE MOTION. THE Commissioner Duitsman opposed. OPTION TO THE SEPTEMBER 13, MOTION CARRIED BRUCE 1993. 5-1. 7. Consider Underwriting a Retail Focus Group Study with the Downtown Development Corporation and other Business people This item was deleted from the agenda. 8. Consider a Loan Request from Indy Lube, Inc. Bill Rubin informed the EDA that Indy Lube, Inc., an Indiana based company, has requested a loan from the EDA Revolving Loan Fund in the amount of $32,500. The loan would be used by Indy Lube to leverage primary financing sources for the construction of a new 2,100 square foot quick lube facility located at Dodge Avenue and 5th Street in Elk River. The EDA Finance Committee met to review the request from Indy Lube and recommended that the total loans for this project not exceed 90% of the project cost, or 90% of the estimated Fair Market Value of the project following its completion. The Finance Committee recommended approval of a loan to Indy Lube, Inc. Bill Rubin indicated that the current proposed loans are at 92%, which reduces the EDA's participation from $32,500 to $24,700, based on the 90% threshold. COMMISSIONER GONGOLL MOVED TO ACCEPT THE FINANCE COMMITTEE'S RECOMMENDATION TO APPROVE A REVOLVING LOAN TO INDY LUBE, INC., IN THE AMOUNT OF $24,700 WITH THE LOAN BElNG SECURED BY A MORTGAGE AGAINST THE DEVELOPMENT PROPERTY AND WITH THE L~AN BEING SUBJECT TO THE EXECUTION OF A PROMISSORY NOTE AND PERSO~AL GUARANTEE. COMMISSIONER HOLMGREN SECONDEO THE MOTION. THE MOTION CARRIED 6-0. ! . . . Economic Development Authority Minutes June 14, 1993 Page 3 9. Consider Options for Multi-County Development Company Bill Rubin indicated that the EDA had recently pledged $1,000 to purchase stock in the Coon Rapids Development Company. He stated that this pledge of $1,000 was made by the EDA under several assumptions regarding the transition of the Coon Rapids Development Company into the Central Region Development Company. The EDA assumed that the existing Coon Rapids Board would change its name to the Central Region Development Company and would expand its Board to include persons from sherburne county. He indicated that the Coon Rapids Development Company Board of Directors has met several times to discuss the Certified Development Company proposed to serve Sherburne, Wright, and Anoka County. During these meetings, several major structural changes were made by the Board to the original presentation which was accepted by the Elk River Economic Development Authority. One of these changes was that the Coon Rapids Development Company would not change its name, but work as the Coon Rapids Development Company dba Central Region Development company. Other changes include no special representation from Sherburne or Wright counties, all Board meetings to be held in Coon Rapids, and no financial contribution or stock purchase would be expected from Sherburne or wright County entities. Bill Rubin stated he is looking for direction from the EDA regarding the response from the Coon Rapids Development Company. Commissioner Dwyer stated he felt that the EDA needs to be associated with an existing group that offers 504 financing. He stated that the City of Elk River would be at a disadvantage with Anoka or Coon Rapids if they do not have the availability of 504 financing. He suggested that Bill Rubin continue searching for an existing group. Bill Rubin indicated that the options were to seek out an existing organization which would include the City of Elk River (and all of Sherburne county) or to create a new multi-county organization. Commissioner Dwyer felt that it would be a financial burden for the City to start up an organization and felt it would be best for the City to join with a group that is already in operation. Bill Rubin informed the EDA that he would continue to look for a development company already in operation in which the City could join. 10. Consider Update on City's Slide Presentation or Create New Video Presentation Bill Rubin requested input from the EDA Commissioners to determine if an update of the City's existing slide presentation should be made or if the City should create a new video presentation. The EDA discussed the uses of slide and video presentations. The EDA discussed the number of times a slide or video presentation would be used in relation to the cost it would take to create such a presentation. Bill Rubin stated he felt that a video presentation would be easier to use than a slide presentation and would probably be used more often than a slide presentation. He further stated that a video presentation could be costly to create. . . . Economic Development Authority Minutes June 14, 1993 Page 4 Commissioner Holmgren stated that most communities who are achievers in economic development have video presentations available and stated he felt the city of Elk River should have a video presentation. commissioner Duitsman stated it would be best to explore all funding possibilities. It was the consensus of the EDA to authorize the Economic Development Coordinator to explore the options and costs of both video and slide presentations. 11. Business Park Update Commissioner Dwyer indicated that he was the Task Force Chair of the Business Park Task Force. He informed the EDA that he has met with some of the EDA members and staff members regarding the Task Force. He stated that discussions were held regarding owner of the property, funding sources, and development options. Many alternatives were discussed and the first Task Force meeting has been scheduled for June 29. These topics will be discussed in more detail with the Task Force Committee and Commissioner Dwyer will report back to the EDA following this June 29th meeting. 12. Discuss Main street Program President Gongoll stated that he attended a satellite down link program on the topic of stabilizing and revitalizing downtown areas. He suggested that the downtown group become aware of the fact that there are state or Federal Programs regarding downtown revitalization and stated that if there is an interest in the downtown revitalization of Elk River, these programs should be pursued. 13. Prospect Status Report The Prospect status Report which was sent under separate cover was discussed by the EDA. 14.1. TIF Legislative Updates Bill Rubin updated the EDA on Legislative actions. He stated that developer repayment of state Aid penalties will be precluded as of August 1, 1993. He further stated that housing development for the elderly or low and moderate-income persons is not subject to State Aid penalty in regard to new Tax Increment Districts. 14.2. Information on Local Industrial Expansion Bill Rubin informed the EDA that Custom Conveyor Corporation, a local manufacturer located in the Elk River Industrial Park, has expanded its present facility bringing it to a total of approximately 21,000 square feet. 14.3. Information on star City Signs . . . Economic Development Authority Minutes June 14, 1993 Page 5 Bill Rubin requested the EDA to consider the existing star city signs with updated signs. It was the EDA to update the existing Star city signs. replacement of the the consensus of President Gongoll congratulated Bill Rubin on his efforts toward the Star city recertification. 15. Adjournment There being no further business, COMMISSIONER HOLMGREN MOVED TO ADJOURN THE MEETING. COMMISSIONER DWYER SECONDED THE MOTION. THE MOTION CARRIED 6-0. The meeting of the Elk River Economic Development Authority adjourned at 8:30 p.m. Respectfully submitted, ~~~~ Sandra Thackeray City Clerk