4.5. SR 10-04-1993
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ITEM 4.5.
TO:
FROM:
MAYOR & CITY COUNCIL
WILLIAM RUBIN, ED COORDINATO~v.L-
DATE: OCTOBER 1, 1993
SUBJECT: RESOLUTION OF SUPPORT FOR A LOAN
REQUEST TO THE CENTRAL MINNESOTA
INITIATIVE FUND
INTRODUCTION
At its meeting on October 4, 1993, the Elk River City Council
will be asked to adopt a resolution of support for a loan
request by BRUMAR, 11157 205th Avenue NW, to the Central
Minnesota Initiative Fund (CMIF). A draft of the resolution is
attached to this memo.
BACKGROUND
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BRUMAR is a metal fabricator and preclslon machining company
that is owned by Mr. Mark Schulte. The company is currently
located in a leased facility on property owned by Mr. Wes
Hunt. The company is experiencing additional business growth
which has necessitated the purchase of more equipment such as
computer numerically controlled (CNC) mills and lathes. The
total cost of this equipment is estimated at $130,000 to
$140,000.
At a recent meeting, attended by Mr. Schulte, his
accountant/business advisor, and Ms. Jeanne Endahl from CMIF,
and the writer of this memo, financing options were identified
and discussed. It is quite likely that BRUMAR's primary lender
will finance approximately one-half of the equipment
purchases. CMIF will likely consider funding the balance.
This application will be considered by CMIF during the second
week of November, 1993.
CMIF is a McKnight Foundation-funded agency that serves the
fourteen-county mid state area. It provides a.) grants to
local units of government and other human service
organization s for capacity building projects; and b.)
supplemental business loans to leverage primary financing in
support of projects which will help diversify the mid state
employment base. A requirement of the CMIF application is a
resolution of support from the local unit of government.
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Staff acknowledges that BRUMAR's current location is
inconsistent with the long-term land use plans for 205th Avenue
NW. That is, the industrial user is operating in an area that
is zoned Agricultural. However, BRUMAR's expansion here is
internal and no expansion of the building is planned at this
time. In addition, a physical expansion of the existing
P.O. Box 490 · 13065 Orono Parkway · Elk River, MN 55330 · (612) 441-7420 · Fax: (612) 441-7425
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building would not be encouraged. Rather, staff would work
with Mr. Schulte in identifying other appropriate sites for the
continued growth of his business.
ACTION REQUESTED
The Elk River City Council is asked to adopt a resolution of
support on behalf of BRUMAR regarding its application for
supplemental financing to the Central Minnesota Initiative Fund.
RECOMMENDATION
I recommend that the City Council adopt the attached resolution.
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RESOLUTION 93 -
RESOLUTION FOR THE CITY OF ELK RIVER
A RESOLUTION OF SUPPORT TO THE CENTRAL MINNESOTA
INITIATIVE FUND (BRUMAR APPLICATION FOR
SUPPLEMENTAL EQUIPMENT FINANCING)
WHEREAS, Pursuant to the prov1s1ons and requirements of the
1987 Rural and Economic Development Act the local
governing unit is required to issue a Sponsoring
Resolution on behalf of businesses requesting
financing through the Central Minnesota Initiative
Fund's partnership with the State of Minnesota's
Challenge Grant Program; and,
WHEREAS, the City of Elk River has received a request to issue
a Resolution on behalf of BRUMAR; and,
WHEREAS, it is consistent with the purpose of the City of Elk
River to encourage employment, enhance the tax base,
and create more opportunity for its residents.
NOW, THEREFORE, BE IT RESOLVED, that the City of Elk River
supports the project submitted by BRUMAR to the
Central Minnesota Initiative Fund's partnership with
the State of Minnesota's Challenge Grant Program.
Passed and adopted by the City Council of the City of Elk River
this 4th day of October, 1993.
John Dietz, Vice Mayor
ATTEST:
Sandra A. Thackeray, City Clerk