02-08-1999 EDA MIN - SPECIAL
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SPECIAL WORKSESSION MEETING OF THE
ELK RIVER ECONOMIC DEVELOPMENT AUTHORITY
HELD AT THE ELK RIVER CITY HALL
MONDAY, FEBRUARY 8, 1999
Members Present:
President Dwyer; Commissioners Bender, Gongol!, Klinzing, Farber,
and Motin
Members Absent:
Council member Thompson
Staff Present:
Paul Steinman, Director of Economic Development; Pat Klaers, City
Administrator; Peter Beck, City Attorney; Andy Brotzler, City
Engineer's Office; Joni Pearson, Recording Secretary
Also Present:
Representatives of Associated Developers - Tony Gleeke!, Rick
Martins, and Jim Winkels
1. Call Meetina To Order
Pursuant to due call and notice thereof, the special worksession meeting of the
Economic Development Authority was called to order at 5:05 p.m. by President
Dwyer.
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2.
Discussion on Hohlen Mixed Use Redevelooment Proiect
Council decision on awardino the bid for oroiect
Director of Economic Development Paul Steinman opened the discussion with an
outline identifying the major project components, and the timing concerns
associated with all of these various project components. He stated that one of
the most crucial steps in the project is a council decision on awarding the bid for
the project, which is scheduled for February 22, 1999.
Andy Brotzler of the City Engineer's Office discussed the tentative schedule for
east Elk River improvements, as presented in a 2/3/99 letter from City Engineer
Terry Maurer. Andy stated that with the assumption that City Council will award
the bid for the project at the February 22, 1999, City Council meeting, it will then
take approximately two weeks for the necessary paperwork before the
contractor can be given the Notice to Proceed and mobilize to the site. He
stated that it is anticipated that underground construction would not start before
April 1, 1999. It is projected that there will be sanitary sewer and water through
the Trott Brook Farms, Elk River Crossing, and Vandenberg Industrial Development
by September 1, 1999.
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Andy indicated according to original contract documents, a February 1, 1999,
start date was anticipated. He stated that assuming the contractor starts
approximately two months late, it is believed that the project would be half to
three quarters complete by the winter shutdown of 1999. This would mean the
sanitary sewer and water project would not be complete until mid summer of the
year 2000.
Special Worksession of the Economic
Development Authority Minutes
February 8, 1999
Page 2
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Andy stated that the one concern with the plans for the street and storm sewer
portion of the project is that all of the right-of-ways necessary for the street
construction must be within the city's control prior to the project being approved
by Mn/DOT for letting. It is anticipated that the rights-of-way will not be obtained
until August 1999, and that construction will not begin until after October 1, 1999
(60-days from the time the right-of-ways are obtained until the project is let). With
this, the bulk of the Tyler street construction would be undertaken in 2000 with
completion of the project in the late summer/early fall of 2000.
Andy stated that the tentative schedule may change if the right-of-ways were
obtained without using the eminent domain process. He indicated that this
would allow for additional construction to be undertaken in 1999; however,
under the best scenario, much of the street construction would carry over until
2000.
Condemnation Proceedinas - Mevissen/Warden
City Attorney Peter Beck indicated that the order of proceedings would be
deliver of appraisals with a formal offer to purchase and the filing of petition for
eminent domain. He stated that it is possible that properties could be acquired
90-100 days after the filing of the petition process.
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Commissioner Bender stated that it was his understanding from a previous EDA
meeting that the appraisals were to come back to the EDA for review prior to
serving.
Director of Economic Development Paul Steinman indicated that staff will
provide the EDA with the appraisals, if completed, at the March 8, 1999, regular
meeting.
Tony Gleekel, Associated Developers Counsel, expressed that he was in
agreement with negotiations to begin following the formal offer and serving of
petitions (anticipated for the third week of March). He further stated that there
are several issues prevailing at this time, such as the request for preliminary plat
review scheduled for the 2/22/99 City Council meeting, the impact that the
timing of Tyler street may have on the project, site development, bids for lateral
utilities on the Hohlen property, and the anticipated quit claim in April for the
Ebner property.
Commercial/Industrial Construction
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Paul Steinman stated that completion of the first industrial building triggers the
EDA's payment to the developer of $300,000 up front as part of their
approximately $2.9 million incentive package. Paul indicated that staff is
currently discussing with the developer that completion of the first industrial
building would also trigger the start of interest on the pay-as-you-go note in the
amount of approximately $2.6 million. He further stated that the ideal situation,
from a cash flow perspective, would be for the commercial component to be
constructed one year prior to completion of the first industrial building. Therefore,
the EDA would save potentially one year of interest on the pay-as-you-go note
and also delay the provision of the $300,000.
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Special Worksession of the Economic
Development Authority Minutes
February 8, 1999
Page 3
Jim Winkels, AMCON, indicated that the timing of the construction of Tyler Street
and utilities is the most crucial issue for industrial development. He stated that the
best possible scenario would be to begin site work in the fall of 1999 (footings,
pad, up to grade) and let it sit through the winter, with the anticipated finish in
June 2000 when the street may be completed.
Director of Economic Development Paul Steinman and City Attorney Peter Beck
both indicated that the developers agreement for the project is still in progress,
and it is anticipated that a detailed outline will be available for EDA action at a
future meeting.
3. Adiournment
President Dwyer adjourned the special worksession meeting of the Elk River
Economic Development Authority at 5:45 p.m.
Joni Pearson
Recording Secretary