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08-14-2000 EDA MIN e MEETING OF THE ELK RIVER ECONOMIC DEVELOPMENT AUTHORITY HELD AT THE ELK RIVER CITY HALL MONDAY, AUGUST 14, 2000 Members Present: President Dwyer, Commissioners Koenig, Gongoll, Thompson, Klinzing (6:05), and Motin (6:05) Members Absent: Commissioner Farber Staff Present: Catherine Mehelich, Director of Economic Development; Marc Nevinski, Assistant Director of Economic Development; Pat Klaers, Executive Director; and Sandra Peine, City Clerk 1 . Call Meetina To Order Pursuant to due call and notice thereof, the meeting of the Economic Development Authority was called to order at 6 pm by President Dwyer. e 2. Consider 4/24/00 Aaenda COMMISSIONER GONGOLL MOVED TO APPROVE THE APRIL 24, 2000, EDA AGENDA. COMMISSIONER KOENIG SECONDED THE MOTION. THE MOTION CARRIED 4-0. 3. Consider Consent Aaenda COMMISSIONER THOMPSON MOVED TO APPROVE THE CONSENT AGENDA AS FOLLOWS: 3.1. JULY 10, 2000 MINUTES - APPROVED 3.2. CHECK REGISTER - APPROVED 3.3. REVENUE/EXPENDITURE REPORT - APPROVED 3.4. BALANCE SHEET - APPROVED COMMISSIONER KOENIG SECONDED THE MOTION. THE MOTION CARRIED 4-0. 4. ODen Mike No one appeared for open mike. Commissioners Motin and Klinzing arrived at this time. e Economic Development Authority Minutes August 14, 2000 Page 2 e 5. EDA SITE - NW Corner Joplin Street & 183rd 5.1. Public Hearina Reaardina Sale of EDA Property & Grantina Business Subsidv Assistance to David & Carole Ripplinaer 5.3. Consider David & Carole Ripplinaer Performance Assistance Agreement Site Plan and Purchase Aareement Director of Economic Development Cathy Mehelich indicated that the Ripplingers are proposing to construct a 15,200 square foot building to relocate and expand their business (Track of the Wolf, Inc.) to Elk River and to provide leasable light industrial space on half of a site currently owned by the EDA located at Joplin Street & 183rd Avenue. The Ripplingers have requested EDA assistance in the amount of $175,900. Cathy Mehelich reviewed the staff report. President Dwyer opened the public hearing and requested public comment on the sale and disposal of the EDA owned property located on the South Half of Lot 1, Block 1, Country Crossing Business Center 2nd Addition and on the issue of granting subsidy assistance in an amount to exceed $100,000 in the form of a land sale write-down, subdivision, and utility extension expenses. There being no comments from the public, President Dwyer closed the public hearing. e Cathy Mehelich indicated that the staff has not reviewed the site plan and that approval this evening would be for the preliminary concept only. COMMISSIONER GONGOLL MOVED TO APPROVE THE SALE OF THE EDA PROPERTY TO DAVID AND CAROLE RIPPLINGER IN ACCORDANCE WITH THE PURCHASE AGREEMENT AND APPROVED PLANS AND SPECIFICATIONS AND TO APPROVE THE GRANTING OF SUBSIDY ASSISTANCE IN THE AMOUNT OF $175,900 PER THE PERFORMANCE/ASSISTANCE AGREEMENT WITH A RECOMMENDATION TO THE CITY COUNCIL FOR FINAL APPROVAL. COMMISSIONER MOTIN SECONDED THE MOTION. THE MOTION CARRIED 6-0. 5.2 Public Hearina Reaardina Sale of EDA Property & Grantina Business Subsidy Assistance to Eauity Manaaement Inc. (Linda Norha) 5.4. Consider Eauity Manaaement Inc. Performance/Assistance Aareement Site Plan and Purchase Aareement As a point of disclosure President Dwyer indicated that he would not participate in the decision of this issue as he is an officer, director, and stockholder of the Bank of Elk River. e Director of Economic Development Cathy Mehelich indicated that Equity Management Inc. is proposing to construct a 22,500 square foot multi-tenant light industrial building on half of a site currently owned by the EDA located at Joplin Street and 183rd Avenue. Equity Management has requested EDA assistance in the amount of $175,900. Cathy Mehelich reviewed the staff report. Economic Development Authority Minutes August 14, 2000 Page 3 e President Dwyer opened the public hearing and requested public comment on the sale and disposal of the EDA owned property located on the North Half of Lot 1, Block 1, Country Crossing Business Center 2nd Addition and on the issue of granting subsidy assistance in an amount to exceed $100,000 the form of a land sale write-down, subdivision, and utility extension expenses, and on setting job and wage goals at zero for the project. COMMISSIONER THOMPSON MOVED TO APPROVE THE SALE OF THE EDA PROPERTY TO EQUITY MANAGEMENT IN ACCORDANCE WITH THE PURCHASE AGREEMENT AND APPROVED PLANS AND SPECIFICATIONS AND TO APPROVE THE GRANTING OF SUBSIDY ASSISTANCE IN THE AMOUNT OF $175,900 PER THE PERFORMANCE! ASSISTANCE AGREEMENT WITH A RECOMMENDATION TO THE CITY COUNCIL FOR FINAL APPROVAL. COMMISSIONER GONGOLL SECONDED THE MOTION. THE MOTION CARRIED 5-0-1. President Dwyer abstained. 6. Review Tax Increment Financina Plan for TIF District No. 21 e Assistant Director of Economic Development Marc Nevinski reviewed the background on the TIF 21 proposal involving the Emmerich site located in the West Business Park. The project will include the purchase of land and the construction of a 73,000 square foot manufacturing facility by Opus Northwest LLC. The facility will be leased by SoftPac, Inc. The TIF plan proposes to reimburse Opus Northwest on a pay-as-you-go basis for land acquisition costs in the amount of $700,000 plus eight percent interest. COMMISSIONER THOMPSON MOVED TO ADOPT EDA RESOLUTION 00-02 RECOMMENDING THAT THE CITY COUNCIL ADOPT THE TAX INCREMENT FINANCING PLAN FOR THE CREATION OF TlF DISTRICT 21. COMMISSIONER GONGOLL SECONDED THE MOTION. THE MOTION CARRIED 6-0. 7. Economic Develooment Budaet for Year 2001 7.1. Consider Initiative Foundation Contribution Reauest Cathy Mehelich reviewed the request from the Central Initiative Foundation for a request for funds for the year 2001. Cathy reviewed the background of past requests from the Initiative Foundation and the city's response to the requests. Cathy recommended that the EDA withhold a contribution for 2001 to allow staff time to evaluate the services provided by the Initiative Fund during the next year. There was a consensus of the EDA to accept Cathy's recommendation and to re- evaluate the request next year. 7.2. Consider 2001 Budaet e Cathy Mehelich reviewed the projected revenues and expenses for the EDA budget and the Business Incubator budget. She noted that the total EDA 2001 proposed expenditures and projected revenues are $153,650. The total Business Incubator expenditures are $42,200 and the total revenues are $12,000. The Economic Development Authority Minutes August 14, 2000 Page 4 -- $30,200 shortfall in the Incubator budget is proposed to be funded through the use of funds generated by Tescom Corporation's loan repayment. It was the consensus of the EDA to approve the EDA and Business Incubator budgets as proposed. 7.3. Consider Resolution Establishina Tax Lew for the EDA COMMISSIONER KLINZING MOVED TO ADOPT EDA RESOLUTION 00-03 ESTABLISHING THE TAX LEVY FOR THE ELK RIVER ECONOMIC DEVELOPMENT AUTHORITY IN AND FOR THE CITY OF ELK RIVER, MINNESOTA. COMMISSIONER THOMPSON SECONDED THE MOTION. THE MOTION CARRIED 6-0. 8. Customer Service and Sitina/Exoansion Process Plan AoDrovaI - Anita Duckor City Administrator Pat Klaers explained that the customer service and client siting/expansion process was highlighted by the Industrial Marketing Committee as a key component of the overall Industrial Marketing Plan. Council member Thompson noted that he was a part of the Marketing Committee and highly recommended that the EDA accept Anita Duckor's proposal to help staff improve its customer service skills and siting/expansion process. ~ Anita Duckor of Duckor and Associates, Inc. gave a presentation of the Customer Service & Siting/Expansion Process Proposal. The total cost of the process is $15,SOO. The city administrator suggested that the cost be split SO/50 between the city and the EDA. COMMISSIONER GONGOLL MOVED TO HIRE ANITA DUCKOR OF DUCKOR AND ASSOCIATES, INC. TO PROCEED WITH THE CUSTOMER SERVICE AND SITING/EXPANSION PROCESS PLAN FOR THE CITY OF ELK RIVER AT A COST OF $15,500. COMMISSIONER THOMPSON SECONDED THE MOTION. THE MOTION CARRIED 6-0. 9. Consideration of Intearated Power Solutions for Incubator Proaram Marc Nevinski stated that Integrated Power Solutions (IPS) has submitted an application to enter the Business Incubator Program. He explained that IPS is a high-tech firm that has developed a process for manufacturing a solid state, thin film battery technology. He stated that the Incubator Advisory Board has reviewed the application and is recommending that the company be admitted to the program. Staff is proposing a lease of $5.00 per square foot with a SO/50 cash/stock ratio. Mark Jensen, president and CEO of the company provided a presentation on the company and its product. e COMMISSIONER GONGOLL MOVED TO APPROVE THE INCUBATOR APPLICATION FROM IPS, ADMITTING THE COMPANY TO THE BUSINESS INCUBATOR PROGRAM AT A LEASE OF $5.00 PER SQUARE FOOT WITH A 50/50 CASH/STOCK RATIO. COMMISSIONER THOMPSON SECONDED THE MOTION. THE MOTION CARRIED 6-0. Economic Development Authority Minutes August 14,2000 Page 5 e 10. Consider Northstar Die Castina Settlement City Administrator Pat Klaers stated that a verbal agreement has been reached with Northstar Die Casting regarding the lawsuit for the repayment of the balance on a micro loan. He noted that the agreement requires Northstar Die Casting to pay the city $1,000 per month for 36 months with an agreement for a Confession of Judgment. COMMISSIONER KOENIG MOVED TO ENTER INTO THE AGREEMENT WITH NORTH STAR DIE CASTING UNDER THE TERMS AND CONDITIONS DISCUSSED BY THE CITY ADMINISTRATOR. COMMISSIONER MOTIN SECONDED THE MOTION. THE MOTION CARRIED 6-0. 11 . Other Business President Dwyer indicated that due to the lateness of the meeting, the report on staff's progress on the marketing plan would be presented in September. 12. Adiournment There being no other business, COMMISSIONER MOTIN MOVED TO ADJOURN THE MEETING. COMMISSIONER KOENIG SECONDED THE MOTION. THE MOTION CARRIED 6-0. - The meeting of the Elk River Economic Development Authority adjourned at 7:27 pm. ~'M~a>>- Sandra Peine City Clerk e