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IDC Agenda 01-19-1989 . AGENDA MONTICELLO INDUSTRIAL DEV LOPMENT COMMITTEE MEETING Thursday. January 1 . 1989 - 7:00 A.M. City Hall MEMBERS: Chairperson Shelly Jo nson. Vice Chairperson Don Smith. Treasurer Lowell Schr pp. Mayor Ken Maus. Rick Wolfsteller. Dale Lungwitz. Arve G imsmo. Ron Hoglund. Harvey Kendall. Jay Morrell. Linda M elke. Dennis Taylor. Jim Kruger. and Ollie Koropchak. STAFF: Jeff O'Neill 1. CALL TO ORDER. 2. APPROVAL OF THE DECEMBER 15. 1988 IDC MINUTES. 3. CONSIDERATION TO REVIEW THE FINAL DRAFT OF THE ORDINANCE ESTABLISHING AN EDA AND THE GREATER MONTICELLO ENTERPRISE FUND GUIDELINES/POLICIES, D THE RECOMMENDATION OF EDA BOARD MEMBERS. 4. CONSIDERATION TO ANALYZE TE 1988 IDC GOALS AND RECOMMENDATIONS OF THE 1989 IDC GOALS. . 5. CONSIDERATION OF THE IDC YAR END FINANCIAL REPORT AND THE ESTABLISHMENT OF THE PROPO ED 1989 IDC BUDGET. 6. CONSIDERATION OF RECOMMEND D ADDITIONAL IDC MEMBERS. 7. REPORTS: CUSTOM SHEET MET L CONSTRUCTION FIV PROPOSAL GENEREUX BONDHUS CORPORAT ON AND SUNNY FRESH. INC. 8. CONSIDERATION OF AN UPDATE OF THE LOCAL AIRPORT PLANS. 9. OTHER BUSINESS. 10. ADJOURNMENT. . . MINUTES MONTICELLO INDUSTRIAL DEV LOPMENT COMMITTEE Thursday, December 15, 1988 - 7:00 AM City Hall MEMBERS PRESENT: Chairperson S elly Johnson, Don Smith, Dennis Taylor, Jay orrell, Arve Grimsmo, Rick Wolfsteller, Linda Mielke, Ron Hoglund, Harvey Kendall, and Ollie Koropc ak. GUEST: Mayor-Elect Ken Maus. CITY STAFF: Jeff O'Neill MEMBERS ABSENT: Lowell Schrup , Dale Lungwitz, and Dan Carlson. 1. CALL TO ORDER. Chairperson Shelly Johnson called the IDC meeting to order at 7:04 AM. 2. APPROVAL OF THE NOVEMBER 1 , 1988 IDC MINUTES. Linda Mielke made a motion to approve the November 17, 1988 IDC minutes, seconded by A ve Grimsmo. With no further discussion the minutes wer approved as written. . 3. CONSIDERATION OF 1989 IDC Don Smith reconfirmed his accepting the 1988 Vice Ch to move up the ladder in 1 as 1989 President of the M He had given consideration the IDC but reconsidered t Johnson was asked to consi inwhich he stated that oth and if no one was interest Arve Grimsmo made a motion 1989 IDC Chairperson and D The motion was seconded by further discussion the mot . Chairperson Johnson expres members to the IDC to enha Ken Maus accepted IDC memb remains on the committee b interest in economic devel Dave Peterson and Ron Hogl as potential new members b marketing and financing, r Dale Lungwitz will remain sentatives will be Linda M for Dan Carlson to remain recommended. MEMBERSHIP, AND GOALS. tatement of a year ago that in ir of the IDC he was unable 89 because of a commitment nnesota Newspaper Association. to a year leave of absence on remain on the IDC. Shelly er a second term as Chairperson r IDC members were well-qualified d he'd accept a second term. to elect Shelly Johnson as n Smith as 1989 Vice Chairperson. Harvey Kendall and without on passed unanimously. ed the potential of additional ce the effectiveness of the group. rship as Mayor-Elect. Arve Grimsmo cause of his commitment and pment. Don Smith will contact nd will contact Dale Pogatchnik cause of their expertise of spectively. The IDC is hopeful n the committee. Chamber repre- elke and Jim Kruger. An invitation n the committee was also IDC MINUTES - 12/15/88 . 3. CONTINUED. The 1989 IDC goals were tabled until the January meeting with Shelly Johnson, Don S ith and Koropchak to serve as a subcommittee with recommendations to the IDC. 4. CONSIDERATION OF UPDATE ON THE ESTABLISHMENT OF AN EDA. . Jeff O'Neill summarized tha he had 1) updated the original EDA Ordinance, 2) reorganiz d the Revolving Loan Guidelines, and developed a Joint Power Agreement between the EDA, the HRA, and the City Council. He pro ceded by explaining the purpose and function of the EDA to the IDC asking for their input of No. 4 FUNCTIONS, P WERS, AND DUTIES, C. The Authority may be a limited partner in a partnership whose purpose is consistent with the Authori y's purpose. The IDC requested more information before a c nsensus was made whether to eliminate or leave in this tern. Other corrections were the EDA to be composed of s ven members (1. CREATION, A.) and (C.) to be correlated w th a total of seven members, the remaining five membe s with appointed terms accordingly. Mr. O'Neill handed out the evolving loan guidelines and informed the IDC that chang s were made to blend with the EDA Ordinance, he asked the IDC to look at it and respond at the next meeting. The R F sub-committee of Dale Lungwitz, Don Smith, Linda Mielke, Je f O'Neill and Koropchak will meet to review the changes. Koropchak is to set up the meeting. Concerns expresse by the IDC were: Are the funds located in the 1989 C ty Budget, the sub-committee will recommend EDA members same as RLF board members) at the next meeting, the ED shall meet regularly at least quarterly, must be co rdinating interest from within, no mention of how the IDC i interrelated with the EDA, the City Ordinance prevails over other ordinances, important to keep seperate the functi ns of the HRA and the EDA, and no mention of capital r turn in the EDA Ordinance. Mr. O'Neill advised the com ittee members to call himself or Koropchak with any addit ons or corrections. The IDC will review and adopt the EDA Ordinance and the Greater Monticello Enterprise Fund uidelines at their January meeting. The subcommittee ill recommend seven Board members at the January meet ng. 5. CONSIDERATION OF A REPORT 0 THE LOCAL AIRPORT PLANS. . Jeff O'Neill informed the I him to further research the stated they were looking fo and upgrading of the local interest with financial ass Harvey Kendall will assist person. Tabled until the J C that time did not permit airport issue, however, assistance for snow removal acility. Big Lake has no stance of the project. Mr. 'Neill with the local contact nuary meeting. IDC MINUTES - 12/15/88 . 6. CONSIDERATION TO MEET WITH T 0 REPRESENTATIVES OF THE DUTCH ECONOMIC DEVELOPMENT A ENCY. Koropchak informed the IDC t contacted her of the IDC pot representatives from the Dut to exchange methods used for meeting would be December 20 Appointed to represent the I Ken Maus, Jeff O'Neill and 0 7. PROSPECTS: FOOD PROCESSING COMPANY - a Monticello location, ho on a stand still until th structure. SCOVILLE~ PRESS INC. - Ko a letter from Scoville Pr to locate elsewhere. Cha IDC he had contacted Mr. of Litchfield and Milaca which allows a company ta availablity of a labor fo at Mr. Sanchez of Bondus Corporation ntial interest to meet with two h Economic Development Agency economic recruitment. The 11:15 AM at the City Hall. C was Ron Hoglund, Arve Grimsmo, lie Koropchak. the company is still interested in ever, plans for construction are completion on a similiar outstate opchak reported she had received ss, Inc. indicating their decision rperson Johnson informed the rendt who stated that the communities ere located within depressed counties credits on equipment and the greater ce willing to work at $4.50 per hour. . INFECTIOUS WASTE FACILTIY - the Planning Commission tabled the request for a conditi nal use for an infectious waste facility until the PCA ha updated their regulations/guidelines on such facilities. It b comes difficult for the City to regulate without State Federal regulations. UNDISCLOSED INDUSTRIAL ANY - this a regional located company wishing to reloca e in Monticello with a project cost of $700,000 to $900, 00 and potential employment of 50 jobs in the medium ski led, skilled, and high skilled wages. TWO LARGE RETAIL/COMMERIC Koropchak had contacts wi retail companies with inq locations. DEVELOPMENTS - O'Neill and h two different large chain iries of Monticello site CONSTRUCTION FIVE - the City Council consensus was the installation of a storm sewer was an undesirable use of TIF. Construction Five requested the use of TIF for the installation of a 60 inch storm sewer along the easterly border of Outlot A (516.82 feet) which would allow them an extra 47.5 feet width to accommodate the city's requirements for parking spaces and setbacks designed around their original site plan. Total of potential 32 jobs plus and substantial' increase in tax base. . NSP - plans for a spring construction of a 5,460 sq ft facility in Oakwood Industr"al Park. IDC MINUTES - 12/15/88 . 7. CONTINUED. METCALF/LARSON PROJEC at a slow pace with d and construction begi signed purchase agree - the project continues to move along molition expected in March or April ning in April or May. The HRA has ents with Ste1ton's, O'Connor, and Jones. 8. CONSIDERATION OF REPORT ON THE MODIFICATION OF THE CENTRAL MONTICELLO REDEVELOPMENT P AN. Koropchak informed the IDC that the HRA had contacted Business Development Services, Inc. to combine the current seven TIF Plans, extend the Central ontice110 redevelopment Plan boundaries and modify the TIF Plan fo newly created Economic District No. 1-8 (NSP). The modifications ill allow for an easier bookkeeping system and available current fina cial records; allow the use of TIF for the Boyle property, Ho lund property, and other areas; and research the potential of excess surplus reserve funds which allows for more flexibility for HRA projects. Mr. Pat Pelstring is assisting the HRA. 9. OTHER BUSINESS. Arve Grimsmo reported 185 b ilding permits were issued in 1988. . The IDC briefly discussed issues of the local industries stating the approval by NSP for exp nsion of the Training Center in 1989, the decrease in employment to 85 at FSI, water supply and pressure at Sunny Fresh along with c ncerns of the treatment plant, and encourage Titan Recreational Products, Inc. to remain in Monticello The IDC inquired of the fut re of the OAA. Potential of annexing 160 acres to the s uth within a couple of years. How long should the annexation process take? Normal conditions, not long, less than a month, once an rea is identified and meets four established criteria an agr ement is established between the City and the Township, owever, the Twonship is not bond to the agreement. Linda Mielke informed the I meeting in December and the Saturday, January 21, 6:30 is Dennis Smith of Smith an a motivation speaker. C that there is no Chamber regular Chamber Banquet is scheduled for M at the Monte Club. Guest speaker Associstes in St. Cloud. He is 10. ADJOURNMENT. By consensus of the IDC, th meeting adjourned with the next scheduled meeting for Janua y 19, 1989, 7:00 AM, City Hall. . ~ \<O\O~~ Ollie Koropchak IDC Executive Secretary IDC AGENDA - 1/19/89 . 3. CONSIDERATION TO REVIEW THE FINAL DRAFT OF THE ORDINANCE ESTABLISING AN EDA AND THE REATER MONTICELLO ENTERPRISE FUND GUIDELINES/POLICIES, A D THE RECOMMENDATION OF EDA BOARD MEMBERS. A. REFERENCE AND BACKGROUN The subcommittee of Linda M met January 13th to review 15th Greater Monticello Ent Mr. O'Neill will present fi EDA Ordinance for IDC appro opinion and thereafter Febr elke, Jeff O'Neill and Koropchak nd make changes of the December rprise Fund Guidelines draft. al drafts of the GMEFG and the al and recommendation for attorney ary 27th City Council approval. Recommendation by the subco (same as RLF Board) are two by Council; the five remain Barb Schwientek, Hospital D Rick Borden (staff recommen HRA Chairperson Al Larson 0 (financial/investment consu be appointed by the IDC. T by the IDC to the City Coun in February. No compensati mittee for the EDA seven membership City Council members to be appointed ng members recommended are strict Executive Director; CPA ation) or CPA Bob Mosford; new HRA member Tom St. Hilaire tant); and two IDC members to e five names will be recommendation il for consideration and appointment n is planned for EDA members. . B. RECOMMENDATION. Recommendation is for the I C to select from the subcommitte~8'_ recommended list the EDA me'bership for consideration and appointment by the City Cou cil and to approve the final drafts. C. SUPPORTING DATA. Final drafts will be presen ed at the meetirig by O'Neill. 4. CONSDIERATION TO ANALYSE TH 1988 IDC GOALS AND RECOMMENDATIONS OF THE 1989 IDC GOALS. A. REFERENCE AND BAXKGROUN The subcommittee of Shelly ohnson, Don Smith and Koropchak met January 17th to establish a list of recommended 1989 IDC goals for the IDC to review adjust if need be, and adopt. Enclosed in the agenda in a copy of the 1988 goals which will be analyzed at the meeting y the subcommittee. Chairperson Shelly Johnson highlighted tems G. and P. as his priorities for 1989. Don Smith recommEnded after adoption of the 1989 IDC goals that the goals arE reviewed and analyzed in July. . B. RECOMMENDATION. Proceea as suggested 1) ana yze 1988 IDC goals, 2) review, adjust if need be, and adop 1989 goals. C. SUPPORTING DATA. Copy of the 1988 IDC goals nd the recommended 1989 IDC goals. . . ~ ~ = - ~ ,., . . "'!! ~~ ~,......." 1988 INDUSTRIAL DEVELOP NT COMMITTEE GOALS A. To host or visit at least ten new b siness/industry prospects during 1988. B. To continue working with existing i dustries in Monticello. C. To obtain 2-4 prospects from existi g industries. D. To attract one or more industries d ring 1988 that will be placed on the tax rolls of the Monticello communi y. E. To develop a list of "targeted" ind strial prospects. F. To revise and update promotional an advertising literature including pamphlets, brochures, and video tap s. G. To revise and update the labor sur v y. H. To continue our study of sewer and the ultimate goal of recommending t in order for Monticello to compete state of Minnesota, when recruiting ater hook-up charges and rates, with the City Council appropriate changes ith other communities, within the business and industry. To finalize the financial incentive package that can be made available, either in total or in part, to pros ective businesses and industries. This package will include: 1. * * * * * Tax Increment Financing State Programs Federal Programs Monticello Enterprise Revolvin Loans and Grants from Other Ag Central Minnesota Initiativ Others J. To establish a positive, cooperativ staff and the Industrial Developmen K. To continue the "Star City" program Loan Fund ncies: Fund working relationship between city Committee. L. To construct an industrial building on an industrial site in the City of Monticello. M. To enhance our committee's relation hip with personnel of state agencies that are involved with industrial d velopment. N. To continue monthly Industrial Deve opment Committee meetings and to schedule special meetings as needed. O. To continue the annual Industrial D velopment Committee Banquet. ,,"; . "j" ... 1,,"C ,~ _'__~rc.,..,.~,~......,,,. ~,\, _""''''''.'~'<~''''''''. . .,=, ..... .e<. .~~.~:...:... ""--'''~''::.'-'.'''~''''-~''''~~''''~''''-.'""-.'-'~-- .,.". "",'.1.. =""".'."' "-~.:.".. .'... .... I .. I -~., 1988 Industrial Development Committee Page 2 ~ P. To continue utilization of the su Industrial Development Committee. structure within the Ii Q. To continue researching the airpo t issue for Monticello. R. To hold a jOint meeting between t e local Minnesota Senators, the local Minnesota Representatives, and th IDC. -1 S. To continue the implementation of extended area metro services to Monticello. - ,I 11 -... ~ .. la --- -~ 11 J1 - =:- . ~ -.. . '"" ~ 'I ... =. i "'. , , .," . ~:J ..J--:::',::.".r'~"'~\~;,~,"'~~,":"',,,,,,,"",:,-_.~"""""'~-_.V-"""""'" RECOMMENDATION OF 19 9 IDC GOALS . A. To host or visit at least during 1989. new business/industry prospects sting industries in Monticello. tention Survey Teams. B. To continue working with ex 1) To establish Business ~i C. To obtain industries/businesses. D. To attract on the tax stries during 1989 that will be placed tice1lo community. E. To revise and update promo iona1 and advertising literature including pamphlets or bro hures, and a video tape. F. To create effective the Labor/Market Survey Data. G. To continue our study of s wer and water hook-up charges and rates, with the ultimate g a1 of recommending to the City Council appropriate change in order for Monticello to compete with other communities, wi hin the state of Minnesota, when recruiting business and in ustry. . H. To finalize the financial ncentives package that can be made available, either in total or in part, to prospective businesses and industries. This pack ge will include: * Tax Increment Financing (Housing and Redevelopment Authority) * State Programs * Federal Programs * Greater Monticello Ente prise Fund (Economic Development Authority) * Federal Programs * Loans and Grants from 0 her Agencies: Central Minnesota Initiative Fund Others I. To continue a positive, cooperative working relationship between city staff and the Indust ial Development Committee. K. To encourage a developer building. o construct a speculative industrial J. To continue the "Star Cit " program. 1. To enhance our committee' agencies that are involve 1) To host a joint meeti Mayor, City Administr Resources, MNTED. De relationship with personnel of state with industrial development. g between the IDC officers, the City tion, and Bill Coleman, Development dline April, 1989. . M. To continue monthly Indus rial Development Committee meetings and to schedule special meeti gs as needed. Recommended 1989 IDC Goals Page 2 . N. To continue the annual Ind strial Development Committee Banquet. 1) To continue with a fal banquet date. 2) To continue with three local industrial testimonies on the program. 3) To continue with the 1 industrial displays. O. To continue utilization of the sub-committee structure within the Industrial Development Committee. 1) Recommend for appointm nt as need be. P. To continue researching thi airport issue for Monticello. ! Q. To hold a joint meeting be ween the local Minnesota Legislators and the IDC. R. To continue the implementa ion of extended area metro services to Monticello. S. To continue the joint meet ng between the Planning Commission. the HRA. the EDA. the IDC, and the City Council. Deadline before June. 1989. T. To continue a positive reI tionship with the Chamber of Commerce. . U. To establish authorized co signatures,for all Industrial Development Committee fina cial holdings on deposit and to establish an annual audit of the IDC financial books by City Administrator Rick Wolfsteller. . CONSIDERATION OF THE ESTABLISHMENT OF THE I IDC YEAJR END FINANCIAL REPORT AND THE PROPOSED 1989 IDC BUDGET. IDC AGENDA - 1/19/89 . 5. A. REFERENCE AND BACKGROUND. The year end financial report will be presented at the meeting for analyzation and the IDC may choose to prepare a 1989 Budget or may choose to establish a subcommittee for 1989 budget preparation with recommendations to the IDC in February. 6. CONSIDERATION OF RECOMMENDEr ADDITIONAL IDC MEMBERS. A. REFERENCE AND BACKGROUNI. Mayor Ken Maus - accepted IIC membership at the December meeting. Dan Carlson - contacted by Iinda Mielke, declined to continue IDC membershi because of previous commitments, however, thanled the committee and wished them well. Dale Lungwitz - good news f om Dale, he plans to remain of the IDC. Arve Grimsmo - will remain In the IDC. Dave Peterson - to be repor ed by Don Smith. Dale Pogatchnik - to be replrted by Ron Hoglund. . THE REMAINING AGENDA ITEMS WITH BE PRESENTED AT THE MEETING. . . . . GREATER MONTICELLO EN ERPRISE FUND GUIDELINES 250 EAS BROADWAY MONTICELLO, INNESOTA 55362 (612) 295-2711 The purpose of the Greater Monticello terprise Fund (GMEF) is to encourage economic development by supplementing onventional financing sources available to existing and new businesses. Throu h this program administered by the Economic Development Authority and participating lending institution(s), loans are made to businesses to help them meet a portion of their financing needs. All loans must serve a public purpose complying with four or more of the criteria noted in the next section. It is the responsibility of the EDA to assure that loans meet the public purpo e standard and comply with all other GMEF policies as defined in this docume t. Along with establishing the definition of public purpose, this docu ent is designed to outline the process involved in obtaining GMEF financing. DEFINITION OF PUBLIC PURPOSE 1. To provide loans for credit wo thy businesses that create new jobs. 2. To provide loans for credit wo thy businesses that would increase the community tax base. 3. To assist new or existing indu businesses to improve or expan provided for businesses in dir within the city of Monticello. trial or non-competitive commercial their operations. Loans will not be ct competition with existing businesses 4. To provide loans to be used as a secondary source of financing that intended to supplement convent onal financing (bank financing). 5. To provide loans in situations in which a funding gap exists. 6. To provide funds for economic evelopment that could be used to assist in obtaining other funds such s Small Business Administration loans, federal and state grants, etc. THE GREATER MONT CELLO ENTERPRISES REVOLVING LO FUND POLICIES I. BUSINESS ELIGIBILITY * * * * * Industrial businesses Non-competitive commercial bus"nesses which enhance the community Businesses located within the ity of Monticello Credit worthy existing busines es Non-credit worthy start-up bus nesses with worthy feasibility studies (Deny all historical on-credit worthy businesses) $10,000 loan per each job crea ed, or $5,000 per every $20,000 increase in property market valuation, or $5,000 per every $20,000 increase in personal property used for business purposes, whichever is higher. * . . . RtF Administration Page 2 II. FINANCING r1ETHOD * COMPANION DIRECT LOAN - Exarnp e: Equity 20%, RLF 30%, and Bank 50% (all uch loans may be subordinated to the prima y lender(s) if requested by the primary lende (s). The RtF loan is leveraged and the lower interest rate of the RtF lowers the effec ive interest rate on the entire proj t. ) * PARTICIPATION LOAN - S a portion of the loan (the RLF is not bordinate position, no collateral is requir d by the RLF, and the loan provides a lower 'nterest rate.) * GUARANTEE LOANS - RtF gu rantees a portion of the bank loan. (perso al and real estate guarantees handled separa ely.) III. USE OF PROCEEDS * * * Real Property Acquisition and Real Property Rehabilitation Machinery and Equipment eve 1 oprnent xpansion or improvements) IV. TERMS AND CONDITIONS * LOAN SIZE - of $5,000 and Maximum not to exceed the remaining revolving loan fund ; if the remaining revolving loan fund balanc is $50,000, the maximum loan issuance is $25 000. * LEVERAGING- 60% private/public non-GMEF 40% Public (GMEF) * LOAN TERM - 1 property term not to exceed life of equipm nt (generally 5 to 7 years). Real E tate Property maximum of five year rnaturiy amortized up to 30 years. Balloon payrnen at 5 years. * INTEREST RATE - from program) Fixed r te of up to 2% below Minneapolis prime rate. * LOAN FEE - fee of $200 but not to exceed 1% of 1 loan project. Fees are to be ed and no duplication of fees between ing institution and the RLF. Build back into project cost. Retain the reduce or waive loan fee or portion fee. (It was suggested that we remove 1 . . . PLF Administration page 3 * PREPAYMENT POLICY - lty for prepayment. * DEFERRAL OF PAYMENTS - 1. roval of the EDA membership by majority vote. 2. Extend the balloon if unable to refinance, ve, ification letter from two lending in titutions, subject to Board approval. * INTEREST LIMITATION ON GUARANTEED LOANS - Subjec to security and/or reviewal by EDA. * ASSUMABILITY OF LOAN - None. * BUSINESS EQUITY REQUIREMENTS - Subjec to type of loan, Board of Directors will d termine case by case, analysis under normal lending guidelines. * COLLATERAL - * Liens on real property i * Liens on real property i * Liens on real property h Directors - homestead ex * Machinery and equipment bankruptcy) * Personal and/or corporat personal guarantees) project (Mortgage Deed) business (Mortgage Deed) ld personally (Subject to Board of mpt) iens (Except equipment exempt from guarantees (requires unlimited ORGAN ZATION The Greater Monticello Enterprise Fund s administered by the City of Monticello Economic Development Authori y (EDA) which is a 7 member board consisting of two council members and f ve appointed members. EDA members are appointed by the Mayor and confirmed by the City Council. Formal meetings are held on a quarterly basis. please see he By-Laws of the EDA for more information on the structure of the org nization that administers the Greater Monticello Enterprise Fund. PARTICIPATING LEND NG INSTITUTION(S) 1. participating Lending Institut on(s) shall be determined by the GMEF applicant. 2. participating Lending Institut on(s) shall cooperate with the EDA and assist in carrying out the pol"cies of the GMEF as approved by the City Council. 3. participating Lending Institut'on(s) shall analyze the formal application, and indicate to t e EDA the level at which the lending institution will participate i the finance package. RLF Administration page 4 . LOAN APPLICATION! INISTRATIVE PROCEDURES The EDA desires to make the GMEF loan pplication process as simple as possible. However, certain procedures must be followed prior to EDA consideration of a loan request. Infor ation regarding the program and procedures for obtaining a loan are as follows: City Staff Duties: The Economic Development Director, working in conjunction with the Assistant City Administrator, shall carry out GME operating procedures as approved by the EDA and Council. Staff is respons! Ie for assisting businesses in the loan application process and will work close y with applicants in developing the necessary information. Application Process: 1. Applicant shall complete a Pre review application for consist Greater Monticello Fund Guidel preliminary loan application s . Staff will request that applic regarding financing needs and action on the loan will requir institution. 2. If applicant gains initial sup preliminary loan application i complete a formal application. not approved by staff, the app approval of the preliminary ap scheduled meeting of the EDA. iminary Loan Application. Staff will ncy with the policies set forth in the nes. Staff consideration of the uld take approximately one week. nt contact a local lending institution ndicate to applicant that further indication of support from a lending ort from lending institution and if the approved, applicant is then asked to If the preliminary loan application is icant may request that the EDA consider lication at the next regularly 3. If preliminary loan applicatio is approved, applicant shall complete a formal application. Formal pplication shall include a business plan which will include its ma agement structure, market analysis, and financial statement. Like docu entation necessary for obtaining the bank loan associated with the roposal is acceptable. Attached with each formal application is a written release of information executed by the loan applicant. 4. Staff will meet with applicant refine plan for financing propo 5. The City staff shall analyze th statements contained therein to finance plan is viable. Staff findings of a banking instituti financial viability of the proj staff shall submit a written re regarding the application shall the submittal of a completed fo . other participating lenderCs) to enterprise. formal application and financial determine if the proposed business and ay, at its discretion, accept the n regarding applicant credit and t. After analysis is complete, City ommendation to the EDA. A decision be made by the EDA within 60 days of mal application. . . . RLF Administration page 5 6. The EDA shall have authority twenty-one days of EDA approv decision by the EDA to approv that such loan was issued in o approve or deny loans; however, within 1, the city council may reverse a a loan if it is determined by council iolation of GMEF guidelines. 7. Prior to approval by the EDA, the City Attorney shall review all contracts, legal documents an intercreditor agreements. After such review is complete, the City hall issue said loan. ORIGINAL REVOL ING LOAN FUNDING "LETTER OF CREDIT" FROM MONTICELL CITY COUNCIL - $200,000.00 SOURCE - City Liquor Store Fund City shall transfer needed loan amount individual loans are approved. Revenue under the control of the EDA and shall the City COuncil determines that reser successful operation of the Authority. transferred to the debt service funds tax levies for bonded indebtedness of establishing the Monticello EDA). from existing accounts at such time that created through this program shall be not be transferred to City funds unless es generated are not necessary for the If such is the case, such funds must be f the City to be used solely to reduce he City {see section 5 B. Ordinance 1. Staff shall submit quarterly ummaries and/or annual report detailing the status of the Monticello nterprise Fund. FUND GUIDELI ES MODIFICATION 1. At a minimum, the EDA shall r view the Fund Guidelines on an annual basis. No changes to the GMEF guidelines shall be instituted without prior approval of the City Co ncil. 1. City staff shall service City loan, monitor City position with regards to the loan, and shall assure City compliance with intercreditor agreement. 2. All loan documents shall incl de an intercreditor agreement which must include the following: A. Definition of loan def ult, agreements regarding notification of default. B. Agreements between len ing institution and City regarding reproduction of pertin nt information regarding the loan. 3. All loan documentation shall include agreements between borrower and lenders regarding release of rivacy regarding the status of the loan. '.<-",~.,,:':"';'."..~ FROM LRRKIN HOFFMRN RNOKR 1 18.1989 16=50 PI 2 *** M E M 0 RAN DUM *** Business Development Sarvlees Inc. TO: Jeff orNeil, Assistant City City of Monticello FROM: Pat Pelstring, Vice Preside Business Development servic DATE: January 18, 1989 ;;E.strator s, tnc, RE: PROVISION FOR THE ESTABLISH ENT OF AN ECONOMIC DEVELOPMENT AUTHOR TY I wanted to respond to your questi authorization of an Economic Devel to participate as a limited partne by the Minnesota legislature to pr Economic Development Authorities t . Depending upon the nature of the E could be a very useful one. It ha a "limited" partner and provides 0 As a limited partner, the EDA will of its actual cash investment and/ tect the EDA as each individual tr direct implication on additional 0 ns concerning the pment Authority (EOA) . This provision was included vide the opportunity for participate in development. A's activities, this provision the statutory authority as erall protection to the EDA. be exposed only to the extent r guaranty. This would pro- nsaction would not have a future transactions. There are several potential ways w ioh this limited partnership provision could be utilized. A re iew of key aspects for its uae would be as follows: 1. Real Estate Investment, The EDA could participate dire ment with a cash and/or loan g example, might be for the cons would be utilized by a busines recruited. The EDA in this ca equity to insure that the fina ,. 2. Equipment Financing. In a similar manner, as in the EDA could participate in equip utilized potentially as an inc locating in the community. A as a limited partner could fac required loan repayments and/o financing. f\'!'IG8AOOK DRIVE . SUITE 230 . MrNNE tly in a real estate invest- aranty. The project, as an ruction of a facility which which the community has e may provide the required cing would be complete. real estate investment, the ent financing which would be ntive for a new business apital investment by the EDA litate the structure of appropriate lease - - ~ = - iii I . - - - -- - - I !! E - ~ . I ! . ~',\"\~ .Yl,! ~, .:..,....(.~ ~ 8lr6J'~: pOUSt MN 55433 . PHoNE: 612/7 ""F'i . . . . 3. Venture Ca ital and/or E ui ..,,~....._~~~:':'~'';'';'--~.''''''''~~~'''.''':'~.:''t..:t4.f.~.ti: ,.... .'.~7~i:'7"';;~,t~~~:,,:.:'-'~.,'~:.~,,".,'~,;':..,~::-:;~":~~_~t_......:~~:~::~~'",:.,_i..:t.:..:~::::r~"...;./:" ~...',:;:~':--:.~~:":' ,-~ Investment. Municipal bond reviewed this provision within the EDA determined that the ability of an Economic Development uthority to participate as a limited partner is not restrictive to the nature of the overall partnership. Generally, partnerships are involved with real estate and/or fixe asset purchases. This provision, however, would pe mlt the formation of a partnership with the EOA as limited partner, which acquires all or a portion of the stoc in a company. We are currently utilizing this pro ision in Marshall, Minnesota, to structure a community reinve tment/equity capital financing program utilizing its Econom'c Oevelopment Authority. I will agree that this type of acti ity by an Economic Development Authority is actiVity not in the traditional senSe of community development agenci s. It is, however, a growing area of economic development financing which may at some point in the future be consi ered by the Monticello Economic Development Authori y. In summary, I would recommend th as a part of its overall author! that an EOA actually utilize its on any regular basis. As such, activities by its eXisting polie policies and types of aotivities be in place and modification wou t the EDA leave this provision ation. There is no requirement power as a limited partnership he EOA could regulate its own ea. At the stage when those change, the authorization would d not be required. It is also important to note tha development financing has change five years. The utilization of require the EDA to participate a sooner than the EDA originally a only kept your options open. I hope that this information will prove useful. If I can be of further assistance, please contact me. PWP/ld ~- \~~ .......:.:......,.......,.. 1 ~ :'5.1 the nature of economic dramatically over the last inancing vehicles which may an "limited partner" may be ticipated. At worst, you have E.12 7:3r:,r:.711 P.03 ,"- .,-:.:..~ "\ . MONTICELLO INDUSTRIAL DEVE OPMENT COMMITTEE Wright County Stat Bank Checking Accou: t BALANCE, March 17, 1988 $ 248.88 DEPOSITS: Transfer from Money October 11, 1988 Transfer from Money December 9, 1988 TOTAL DEPOSITS Market $2,000.00 Market $2,000.00 $4,000.00 $4,284.88 . WITHDRAWALS: Koropchak, 11282 Mileage, 5/5/88 $ 16.75 Koropchak, 11283 Mileage, 5/25/88 73.50 Koropchak, 1!284 Mileage, 6/23/88 13.00 City of Monti, 11285 Seminar, 6/23/88 70.00 Koropchak, 11286 Mileage, 7/19/88 30.00 Koropchak, 11287 Meals, 8/10/88 16.61 Minn Bankers Assoc, 11288 Koropchak, 10/2/88 40.00 Monti Printing, 11289 Banquet Tickets, 10/7/88 33.97 Monti Office Products, 11290 Banquet Supplies, 10/7/88 44.05 Woodtype Minnestoa, 11291 Banquet Gift, 10/7/88 48.00 Little Mountain Flowers, 11292 Banquet, 10/7/88 31.80 Monte Club, 11293 Banquet Dinner, 10/7/88 1, 10.25 Monte Club, 1;294 Gratuity, 10/7/88 235.00 Harvey Kendall, 11295 Mileage & Meals, 12/2/88 30.60 BDS, Inc, 1!296 Labor Survey, 12/7/88 1,760.90 MIDA, 11297 Koropchak membership, 1/10/89 95.00 TOTAL WITHDRAWALS $3, 49.43 . Continued Wright County Checkin . SERVICE CHARGES: March, 1988 April, 1988 May, 1988 June, 1988 July, 1988 August, 1988 September, 1988 October, 1988 November, 1988 December, 1988 TOTAL SERVICE CHARGES $ .95 .80 1. 20 1. 20 1.15 3.15 3.00 4.05 2.80 3.10 21. 40 $ TOTAL WITHDRAWALS AND SERVICE C ARGES BALANCE, January 18, 1989 Prepared by Ollie Koropchak 1/18/89 . . $3,970.83 $ 314.05 . MONTICELLO INDUSTRIAL DEVE OPMENT COMMITTEE Wright County State Bank Money Market BALANCE, March 17, 1988 DEPOSITS: Banquet September 1988 Banquet October & December 1988 Chamber Contribution January 1988 1988 City Contribution January 1988 TOTAL DEPOSITS . INTEREST: March, 1988 April, 1988 May. 1988 June, 1988 July, 1988 August, 1988 September, 1988 October, 1988 November, 1988 December, 1988 TOTAL INTEREST TOTAL DEPOSITS AND INTEREST WITHDRAWALS: BDS, Inc. 11517 Labor Survey, 6/3/88 Transfer to Checking 10/88 Transfer to Checking 12/88 TOTAL WITHDRAWALS BALANCE, January 18. 1989 1988 Salary Due BALANCE THEREAFTER . Prepared by Ollie Koropchak 1/18/89 $ 5,702.96 $ 50.00 2, 25.00 1. 75.00 2, 00.00 2, 00.00 5. 00.00 $15, 00.00 $ 40.53 24.39 23.70 18.87 18.30 18.38 25.45 42.07 43.43 38.89 94.01 $ $16,094.01 $21,796.97 $ 1, $161,296.97 2. 2, $ 5, $15, 41.93 $> 755.04 . MONTICELLO INDUSTRIAL DEVEOPMENT COMMITTEE Security Financial Bank ng and Savings Money Market Balance March 17. 1988 DEPOSITS: INTEREST: March. 1988 April. 1988 May. 1988 June. 1988 July. 1988 August. 1988 September. 1988 October. 1988 November. 1988 December. 1988 TOTAL INTEREST TOTAL DEPOSITS AND INTEREST WITHDRAWALS: . BALANCE. 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