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IDC Agenda 07-18-1991 . . . AGEN 'A MONTICELLO INDUSTRIAL D VELOPMENT COMMITTEE Thursday, July 18, 1991 - 7:00 AM City H 11 MEMBERS: Chairperson Shelley Johns: n, Don Smith, Ron Hoglund, Dale Lungwitz, Arve Grimsmo, Jay Morrell, Ken Maus, Lowell Schrupp, Harvey Kendall, Dennis Taylor, Dave Peterson, John McVay, Linda Mielke, ,Tom Pogatchnik, Bob Dawson, and Candy Benoit. Rick Wolfsteller, Jeff 0 Neill, and Ollie Koropchak. STAFF: GUEST: 1. CALL TO ORDER. Chris Lommel, Chris Lomm I Productions, Inc. 2. CONSIDERATION TO APPROVE THE APRIL 18 AND MAY 17, 1991 IDC MINUTES. 3. CONSIDERATION TO HEAR THE MON HLY IDC FINANCIAL REPORT. 4. CONSIDERATION TO HEAR AN UPDAT OF THE MONTICELLO PROMOTIONAL PRODUCTION. OF PLANS FOR TH 1991 IDC RECOGNITION BANQUET. Monday, Septem er 30, 1991, Monte Club Promotional Production, Speaker 1, Testimonies: erry Heying, Ray Schmidt, and Jerry Schoen. ? ?, No open bar. 5. CONSIDERATION a) Date: b) Program: c) Meal: 6 . CONSIDERATION OF IDC/INDUSTRI 7. CONSIDERATION TO HEAR UPDATE a) AROPLAX CORPORATION b) SHINGOBEE, INC. c) MAID OF SCANDINAVIA d) ELAINE NORDNESS e) BROADWAY MACHINERY f) R A MORTON g) WALMART h) CARE CHAIR INDUSTRIES i) RICK ROBINSON j) BURT INDUSTRIES, INC. k) G & G OIL EQUIPMENT 1) THE H-WINDOW COMPANY 8. OTHER BUSINESS. 9. BRE BREAKFAST FOLLOW-UP. PROSPECT LIST: ADJOURNMENT. (Chamber meeti g, today, 11:50 AM, American Legion, Guest speaker: Senator Betty Adkins). . . . MINUT S MONTICELLO INDUSTRIAL D VELOPMENT COMMITTEE Friday, May 17, 991 - 7:00 AM City H 11 MEMBERS PRESENT: Chairperson Shelley Johnson, Don Smith, Ron Hoglund, Lowel:l Schrupp, Arve Grimsmo, Dale Lungwitz, Jay' Morrell, Harvey Kendall, Ken Maus, Linda Mi lke, John McVay, Dennis Taylor, Tom Pogatchnik and Bob Dawson. MEMBERS ABSENT: STAFF PRESENT: Ollie Koropcha . Dave Peterson nd Candy Benoit. 1. CALL TO ORDER. Chairperson Johnson AM. 2. CONSIDERATION TO APPROVE THE Tabled. 3. IDC meeting to order at 7:03 1991 IDC MINUTES. CONSIDERATION TO ACCEPT THE I C MONTHLY FINANCIAL REPORT. Treasurer Hoglund reported a b lance of $4,186.85 at Security Financial and a balance of $1 476.90 at Wright County for a total balance of $5,663.81. arvey Kendall made a motion to accept the financial report as iven, seconded by Linda Mielke and without further comments the reported was accepted and filed. 4. CONSIDERATION OF PROSPECT UPDA E: a) Aroplax Corporation - Kor pchak informed the IDC members that the HRA approved th use of TIF on May 1 with the City Council having calle for a public hearing date of June 10, 1991 for approvl TIF plan and district. TIF will be used for land wri e-down and the company request $30,000 from the GMEF for' M&E. Total financial project cost is approximately $92: ,000. Maid of Scandinavia - Upn the HRA's and Pat Pelstring suggestion for an alterntive option to finance a land purchase other than TIF, t has been communicated to Mr. Dahlquist of the possibi'ity to utilize a performance agreement for the HRA-ow ed lot only, Lot 5, Block 3, Oakwood Industrial Park. The agreement could require no down payment for 2-3 year, reduce land price by $1,500 per employee on the site t the end of this time period b) . IDC MINUTES 5-17-91 and offer any residual balance at attractive terms. Agreement would be tie to a minimum square foot requirement by a certa n date. Mr. Dahlquist was interested in such a concpt and requested topgraphy maps of the lot. Upon Koropchak' s request to OSM the topgraphy maps were maild to Mr. Dahlquist for review and subsequently for rev"ew by their contractor. Mr. Dahlquist inquired of the: availability of the lot to the east, owned by Ron and Dee Johnson. Koropchak will attempt to contact the p rty and check on the status of the property taxes. c) Frito-Lay, Inc. - Koropc ak informed the committee that she has attempted to con act, however, without success, Chris Bittner at Frito Lay regarding the company's planned expansion. Ron oglund informed the committee that the company is 10 king for a 2,400 sq ft cold storage area for produ t distribution with no job creation. Suggestion w s to contact Bob Rierson for possible available space. . d) New coding process compan - The preliminary inquiry came from NSP and the start-up company's needs are 600 amp, 3 phase, and 20 ft ceiling eight. Jay Morrell's facility has 12-15 foot ceilings nd 400 amp per each building. The name of the company 'nd details of the process were not disclosed. e) Continental Life Insuranc - The Idaho insurance company was initially looking far start-up leaseable space to establish a back office operation. Majority of the employment would consist of claims clerks and health underwriters. Initial emploYment of 25 with full expansion in two years 0 200 employees and a 30,000 sq ft building. John Carls rom, Monticello Mall property manager, was contacted 0 potential temporary leaseable space. All requested in ormation was mailed in April. The scope of the project nd the time frame have changed as the Idaho governor etoed the bill to lower the premium tax on health in urance which may have make it more affordable for Idah residents. "This action may provide a greater oppor unity for Minnesota," states Terrell Towers, Minnesot contact. f) TIF/SPEC Project (Shingo ee, Inc.) - Due to the arrival of the Letter of Intent 0 the day of the HRA meeting and Mr. Pelstring receivin the actual project costs, inclusive of leasehold c sts, late the TIF Plan wasn't drafted, therefore, the HRA took no action on the project. Gae veit and T m Golewski of Shingobee, Inc. presented the preliminar building and site plans to the HRA. Adoption of the T F Plan is expected at the HRA June meeting. . . IDC MINUTES 5-17-91 g) Dennis Pomerleau - Follow ng the meeting with the lending institution, aDS, Inc., a d the developer adjustments in the collateral value st ucture were made because the value placed on existing inventory can be the purchase amount only. At this t me Mr. Pomerleau has heard no response of his offer for purchase of existing inventory and inquiry is being m de for possible support from venders for needed collateral. Maximum GMEF would be $15,000 for M&E. h) Enviro Acoustics - no n w information is available on this company who manufac ures noise control equipment. i) . . R.A. Morton - Mr. Morto represents a tire retreading business in St. Cloud ho is looking relocate their manufacturing and distr bution center. The overall complex plans are for 60,000 sq ft of which one-half is cold storage. The compan has worked with the St. Cloud HRA for six months with no results. The company is landlocked in their cu rent 45,000 sq ft facility, current emploYment is 50- 0 with average wages of $23,000 to $25,000. Immediate ad itional employment of 10 to 20 with potential of 100 to al in five years. Information of Monticello and our fi ancial incentives were mailed. Initial contact May 13. j) Rick Robinson - This fami y-owned diaper service company is looking to construc a 2,000 sq ft facility to manufacture diapers. C rrently the Big Lake business operators a diaper servic , pick-up and laundry, and has developed a new diaper (N ture-Way Diaper). Employment of six full time and part t me with potential of 15. The company was interested on financial incentives. Time frame six months. k) Kromer Company - This com any located in Mound is looking long range to lease a 13, 00 sq ft facility. The company manufactures spray equipent for highways, fertilizers, football fields, etc. Th' business currently operates in three different locati ,ns. They request financial incentive information an are looking for a bank willing to extend a good line of credit. Time frame 1992. 1) The H-Window Company - B,sed on Don Smith's information given the IDC in March, 'Koropchak proceeded to contact Steve Lemme on our willigness to meet with the Board of Directors upon their May visit. The Board members will arrive May 24 and depar on May 31. Upon Mr Lemme's recommendation a meeting has been set for May 29, 10:30 AM, between the board and Mayor Maus, IDC member Grimsmo, __.. __.1 . . . IDC MINUTES 5-17-91 Pat Pe1string, and Kor pchak. The objective of the meeting is review the history of the Monticello H-Window facility and the company's investment into Minnesota and Monticello, to hear t e company's potential future expansion plans, and to e plore additional available land options and the City Qf Monticello's interest in a business retention and e pansion commitment. The IDC inquired about the Wa1-Mart Distribution Center location. Koropchak reported that no decision has been made and the three communities are still in the running. Mr. Lungwitz informed the IDC members that Tapper's Inc. SBA loan had received a 90-day ext nsion to allow time to collect the outstanding lien against the general contractor, Bill Henning & Associates. It s the intent of the lending institution, Tapper's Inc. a d the county attorney to file criminal charges against the ontractor. 5. CONSIDERATION OF FOLLOW-UPS. a) All-Governmental Units M etings - confirmed for June 3, 1991 at the N P Training Center. planners will present la d use options, traffic water/sewer issues, etc. Monday, Various issues, IDC/Industrial Breakfast - confirmed for Thursday, June 20, 1991, 7:30-9:00 AM a the Monticello Country Club. Program will be low-keyed and center around local issues. b) c) EDA Action - Upon the equest of the EDA, the City Council approved the GME guidelines as recommended by the EDA, authorized a co itment of $90,000 of the UDAG funds to the GMEF, and authorized a commitment of $48,000 from the Liquor Store Fu d to allow for a annual GMEF Appropriation Balance of 200,000. This consist with our 1991 Economic Developmen Work Plan. d) EAS Metro - The EAS co t studies for Monticello are delayed by 60 days as the: local telephone company and US West Communications did ' ot start at the same meeting point. The commission e tended the time. Arve Grimsmo reported Monticello would have metro in 1992. Additionally, it was reported hat the local Post Office will begin construction of their new facility in 1993 and operational in 1994. . . . IDC MINUTES 5-17-91 6. CONSIDERATION TO SET A DATE F R THE IDC RECOGNITION BAN UET. Monday, September 30, 1991 was established as the date for the annual IDC fundraiser banquet Program to be decided later. 7. OTHER BUSINESS. The requirements for landscaping, curb and hard surface for industrial businesses was briefly discussed. Mr. Morrell mentioned the two to three nw industries in the Maple Lake Industrial Park. He reported hey were very nice developments wi thout the extreme landscapin or curbing. He expressed that the unnecessary monies being expended up front by companies didn't make good sense as ur unpredictable climate can destory those costs so quickly. Mayor Maus explained the City has reduced its requirements for industrial developments. Koropchak indicated that if in rement is sufficient, companies are encouraged to use TIF to over the construction cost for underground sprinkles. A pe missible use of TIF. Our city planner will cover creative p rking, etc. 8. ADJOURNMENT. The IDC meeting adjourned at :05 AM. ~ \Stl\()~Sl~ Ollie Koropchak, IDC Executive Sec etary . . . MINUT S MONTICELLO INDUSTRIAL D VELOPMENT COMMITTEE Thursday, April 18, 1991 - 7:00 AM City H 11 MEMBERS PRESENT: Chairperson Sh lley Johnson, Don Smith, Ron Hoglund, Denni Taylor, Lowell Schrupp, John McVay, Arve rimsmo, Dale Lungwitz, Jay Morrell, Ken Mus, and Candy Benoit. MEMBERS ABSENT: Harvey Kendall, Dave Peterson, Tom Pogatchnik, Linda Mielke, nd Bob Dawson. STAFF PRESENT: Rick Wolfstell: Koropchak. Jeff O'Neill, and Ollie 1. CALL TO ORDER. Chairperson Shelley Johnson ca led the IDC meeting to order at 7:00 AM. 2. APPROVAL OF THE MARCH 21 199 IDC MINUTES. Ron Hoglund made a motion to pprove the March 21, 1991 IDC minutes, seconded by John McVa , and without further dicussion the minutes were approved as ritten. 3. CONSIDERATION OF PROSPECTS: a) Aroplax Corporation - K ropchak reported the purchase agreement for the west 40: ft of Lot 3, Block 2, OIP, is being drafted by the Oakw od Partnership's attorney. The company obtaining constr ction costs from two general contractors. SBA applica ion submittal in early May. At this time no meeting date with Mr. Schoen and the IDC Promotional Committee has: been set. It was suggested to inquiry of the company's: interest to purchase the 1.9 acre triangle piece betwe: n the chosen lot and Tapper's, Inc. b) Dennis Pomerleau - It is iKoropchak's understanding that Deb Gustafson, BDS, Inc ; Mr. Pomerleau; and a local lending institution are eeting this morning to review original funding dollar requested versus the final dollars needed. Jay Mor ell informed the IDC that the results of this meeting will determine the need to draft a lease agreement. It is the intent of the developer to lease 7,200 sq ft from M P Transport, Inc. c) Towle Real Estate (Maid o:f Scandinavia) - the company is awaiting the sale of the"r present location on Hwy 100 and Hwy 7, meanwhile, hey continue to scout for a building in foreclosure r free land without the use of . IDC MINUTES 4-18-91 TIF. Arve Grimsmo reported he spoke with Mr. Richard Dahlquist, President of t e Maid of Scandinavia, who also informed Arve of the ompany's desire for no TIF assistance because the c mpany does not want to deprive the taxing jurisdictions f the revenue created by their developed project. Korop hak will call Mr. Dahlquist to inform him of industrial, land costs in Monticello and will contact Mr. Pelstrin for possible creative ideas to assist in land acquisiti ,n without use of TIF. d) Olson Concrete of Minne polis - Mr. Ed Sorgatz has a client looking to reloc te from their present leased metro facility to a la ger owner-occupied facility. Initially the facility would be 25,000 sq ft with potential of a total 75,0 0 sq ft facility. The company is a clean manufacturing/ ssembling business who markets nationally. Fifty to six Y jobs. The State of Wisconsin has offered them a defer ed loan of $700,000 at a 3-4% interest rate. The city of Cambridge has also provided the company a financial ackage. Shingobee, Inc. Ko rpchak reported that Paul Weingarden, Gae Veit, To Golewski, Pat Pelstring, Jeff O'Neill, and herself had et to review the objectives of the TIF/SPEC project and the revised TIF analysis. One concern was that leaseh ld costs were not included in original request for p' oposal. Mr. Weingarden was concerned with the fairn ss of the Shingobee submitted proposal compared to ot: er proposals submitted which included the leasehold co ts. Mr. Pelstring suggested to Shingobee, Inc. that th leasehold cost of $35,000 be included in the proposal to comply with the request for proposal criteria and t justify the use of TIF which must be a carry through 0 the leasee in the form of a rent reduction and must ,ot benefit to the developer. The objectives of the 'roject were reviewed and Mr. Weingarden will draft a letter of intent and Shingobee will consider the inclusion of the leasehold costs and inform Mr. Pelstring. Pans are to have the project on the May HRA meeting. Dal Lungwi tz informed the IDC that it's been six to seven. eeks since Gae Veit initially contacted the Oakwood patnership regarding a commitment on the land. e) . f) Fulfillment Systems, Inc with Mr. Peach for poten the Continental Life indicated they would be 0 for another two to three . - In Koropchak's conversation ial leaseable office space for nsurance Company; Mr. Peach cupying the Monticello facility years. . . . IDC MINUTES 4-18-91 g) Walmart Distribution Cen er - Koropchak reported that the Walmart Distribution qenter location has not been determined, the three reaining communities are Owatonna, Fairbault, and a Wisco sin city. Mr. Terrell Towers informs us that the c' mpany is addressing the tax situation of the propose project. h) Enviro Acoustics small family business was incorporated in 1986 a d manufactures noise control equipment for Forture 500 companies. Looking to lease or purchase as, 000 sq f: facility which would employ approximately 10 persons with a salary range of $8.00 to $9.00. The company was inquiring of financial incentives. 4. CONSIDERATION TO DISCUSS AGE DAS AND MEETING DATES FOR THE GOVERNMENTAL UNITS MEETING AN IDC/INDUSTRIAL BREAKFAST. Staff and the IDC agreed govenmental units meeting objective "to get together" well served, however, inorder to maintain the interest a new nd fresh approach or agenda is needed. Don Smith acknowledg d the good job city staff had done in previous presentations: and than made a suggestion for a new meeting location and al subject matter of where the city's going in five to ten ye rs. Jeff O'Neill informed the IDC that Elk River had recentl completed such a meeting with the assistance of an outside s eaker. It was agreed that the presentation would concentrat. on the area's under study (southeast area, Farm Credit' and school property) by the city's professional planner. he governmental units meeting was scheduled for Monday, Jun 3, 1991 with the potential location of the NSP Training C nter. Upon the recommendation of t e IDC, Koropchak is to make arrangements for the IDC/lndustrial Breakfast. Suggested location the Monticello Country Club, breakfast scheduled for June with a light program cente around community information. 5. CONSIDERATION OF UPDATE ON IOCiGOAL ACTIVITIES: a) Newsletter - Koropchak rep rted that in keeping with the IDC goals, the first IDC n wsletter was mailed out to the local industries in March.1 The members asked for a copy of the newsletter. : Housing Development Report - Jeff O'Neill presented the IDC members with a copy of comparable single family residential permits issue between 1980-1990 for the cities of Big Lake and Mon icello, and for the townships of Monticello, Big Lake, a d Becker. Final comparisons b) . IDC MINUTES 4-18-91 indicated townships outs ripped the urban areas for the number of permits issued.: The city of Monticello peaked in 1986 with 64 permits i sued and the comparative range was a low of 12% in 1989 to a high of 29% in 1980. The IDC asked why the low hou ing development in Monticello? Some reasons stated wer 1) Sherburne County has had loose rules for developme t of single family construction which is in the process f change, 2) a permit charge in the Big Lake Township i $176 compared to over $1,000 (inclusive of water/sewerl hookup) in Monticello, however, Mr. O'Niell pointed out !Monticello cost is within the average community range f 78% of other communities, 3) availability of land and ront-end development expenses, 4) land costs ($20,000 or a wooded lot within two to three miles of Monticell compared to a $20,000 city lot with one tree). Dennis aylor reported 80% of his work is in the township because it's not as costly. Big Lake Township lots run for ap roximately $12,000 and is one- fourth of the Monticello school district. . With the delinquent asse sment and taxes of the former Boyle property being nego iated between the city and farm Credit this will free u some developable lots in the ci ty. Currently, a st. C oud developer is considering 36 acres in Meadow Oaks, Val e Plus is considering 109 acres to the south of the middl school with a potential of 10- 15 homes per year. The Kjellberg development received preliminary plat approva by the Council, however, the plat has not been recor ed at the county. Mayor Maus indicated that the percep: ion may be that the city has no attractive available sit s. It was suggested the need to market Monticello with emphasis in the area of free garbage pick-up, water/s wer rates, and other services available in Monticello. c) Koropchak informed the DC members that the Star City Conference will be held, May 15 and 16 therefore the committee agreed to resc edule the May IDC meeting from May 16 to Friday, May 17 7:00 AM. 6. OTHER BUSINESS. None. 7. ADJOURNMENT. . The IDC meeting adjourned at :16 AM. ~ \<c0 SL-~ Ollie Koropchak, DC Executive Sec etary . . . June 10, 1991 Ms. Ollie Koropchak Economic Development Director City of Monticello P.O. Box 1147 Monticello, MN 55362 Dear Ollie: Last Thursday, our client made a deci and have started the process of acqui the site at this time. B.A. Morton CONSTRUCTION MANAGERS 821 West 51. Germain 51. Cloud, MN 56301 (612) 251+0262 regarding their future site the land. I cannot disclose I must tell you that it was not in yo r community. We appreciate your effort on behalf 0 your community; the pride and success is very evident in your prese tation materials. Sincerely, ~~~~ Ronald A. Morton President RAM: a . . . July 8, 1991 Ms. Diane Yonak 1020 Oak Lane Monticello, MN 55362 RE: SBA FINANCING Dear Ms. Yonak: Per our telephone conversation, I wanted to onfirm with you that, based upon our review of your financial statements, we 0 not feel that the project would be eligible for SBA financing at this time. T erefore, I am returning your financial statements to you. Weare sorry we were not able to assist y u with your financing request. Sincerely, BUSINESS DEVELOPMENT SERVICES INC. Deborah L. Gustafson V ice President Financial Services Division DLG/ld cc: Gary Y onak bcc: O. Koropchak . ~ ~ , .... ~ ~ , ~ July 10, 1991 MONTICELLO - 250 East Broadway P. O. Box 1147 Monticello, MN 55362-9245 Phone: (612) 295~2711 Metro: (612) 333~5739 Fax" (612) 29S~4404 Mr. Douglas Antony Northern States Power Company Monticello Generating Plant Box 600 Monticello, MN 55362 . Dear Mr. Antony: On behalf of the Monticell Industrial Development Committee, the Economic De elopment Authority, the Housing and Redevelopment Autority, and the Chamber of Commerce, I congratulate ou and your Monticello Generating Plant employees r 20 years of commercial service. The Monticello Generating P ant has without a doubt enhanced Monticello's ability to attract new industrial businesses and to retain our xisting businesses. Your company allows for an attract've Monticello tax base and allows the City of Montie 110 to provide maximum affordable city infrastructu es to its residents and businesses; but equally impo tant is the fact that NSP provides quality electrical s rvice to our residents and businesses and employs qualit personnel who support and are committed to Monticello nd its various community services. Addi tionally, NS is recognized by other businesses as a quality comp ny, all of which enhance Monticello's promotional mark ting efforts. . I thank you for those enhanc ments. It's also been my pleasure and appreciation to ork with such professional people as yourself, Harvey ;endall, John McVay, Larry Nolan, Russ Van Dell, Lon Wa dinger, Bob McGillic, Bob Clark, Jerry Zimmer, Harold Wil k, Anita Duckor and others who have committed time and nergy toward Monticello's industrial recruitment efforts. . Mr. Antony 7-10-91 Page 2 Again, congratulations to NSP nd much continued success. Respectfully, CITY OF MONTICELLO ~ \.~CJ'\o~~ Ollie Koropchak Economic Development Director . . July 10, 1991 MONTICELW 250 East Broadway P. O. Box 1147 Monticello, MN 55362-9245 Phone: (612) 295-2711 Metro: (612) 333-5739 Fax: (612) 295-4404 Mr. Jerry Zimmer Northern states Power Company 3515 Third street North P.O. Box 808 St. Cloud, MN 55302 Dear Mr. Zimmer: . On behalf of the Monticel 0 Industrial Development Committee and the City of MOl tlcello, I thank you for your assistance in obtaining sp's donation for our new communi ty promotional marketi 9 video. Also, many thanks to NSP. The new production i scheduled to be completed and shown at our annual fun raiser banquet on Monday, September 30, 1991. Pleas mark your calendar and details on the banquet will b mailed at a later date. Again, Jerry, thank you and our assistance is greatly appreciated. Sincerely, CITY -OF MONTICELLO ~ \<..cl\ 0 ,,~~ Ollie Koropchak Economic Development Directo . . .i .. , .. ~ ~ ~ ~ July 12, 1991 MONTICELLO . 250 East Broadway P. O. Box 1147 Monticello, MN 55362-9245 Phone: (612) 295~2711 Metro: (612) 333~5739 Fax; (612) 295~4404 Mr. Terrance Heying Sunny Fresh Foods, Inc. 204 West 4 Street Monticello, MN 55362 Dear Mr. Heying: . On behalf of the Monticello Indus rial Development Committee, I would like to thank you and Ann Hu ley for your attendance at the IDC/Industrial Business Retention nd Expansion Breakfast in June. Also, a special thanks to Sunny Fr sh Foods for the delicious food provided for the breakfast meal. I look forward to our continued coo erative working relationship to encourage economical growth for bot Sunny Fresh Foods and the City of Monticello. If I can ever be of assistance to Sunny Fresh, please don't hesitate to call. Again, thank you. Sincerely, CITY OF MONTICELLO ~ \<'d'lo,J~ Ollie Koropchak Economic Development Director .