EDA Minutes 08-28-2019 (Joint Meeting)MINUTES
JOINT ECONOMIC DEVELOPMENT AUTHORITY (EDA) AND CITY COUNCIL
MEETING
Wednesday, August 28th, 2019 — 7:00 a.m.
Academy Room, Monticello Community Center
Commissioners Present: Bill Tapper, Jon Morphew, Tracy Hinz, 011ie Koropchak-White,
Lloyd Hilgart, and Jim Davidson
Commissioners Absent: Steve Johnson
City Council Present: Brian Stumpf, Lloyd Hilgart, and Jim Davidson
City Council Absent: Charlotte Gabler and Bill Fair
Staff Present: Jim Thares, Jeff O'Neill, Angela Schumann, Tammy Omdal
(Northland Securities), Martha Ingram (Kennedy and Graven)
1. Call to Order
Bill Tapper called the Joint Meeting of the EDA and City Council to order at 7 a.m.
2. Roll Call
3. Consideration of additional agenda items
4. Consent Agenda
None
Regular Agenda
5. Global review of UMC, Inc. expansion, proposed land transaction, assistance
package and timeline
Jim Thares introduced the item and noted that UMC was looking at expanding their
business. The new 40,000 square foot building would be located on the parcel adjacent to
their existing 72,000 square foot facility. UMC would add 60 new FTE jobs as part of the
expansion. The project is estimated to cost about $8.7 million.
The parcel UMC would like to acquire is owned by Shawn Weinand. In order for the
transaction to occur, UMC has asked the EDA to purchase the land and in turn sell it to
UMC for $1. Through state grants, $300,000 would be recovered by the EDA for the cost
of the land. In order for Weinand to sell the land at a discounted rate, he asked that the
City sell him its 20 -acre parcel on Edmunson Avenue. The goal would be to build patio
homes similar to the Autumn Ridge Villas project.
The EDA would need to establish a new TIF district to recover the full costs of the land.
After the nine-year period of TIF, tax abetment could be used to return any funds not
already recovered through TIF. Initial projections indicate that both TIF and Tax
Abatement will be needed for the recovery of the land costs based on the present
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development proposal size and value.
Lloyd Hilgart asked that if an additional expansion occurred on the new parcel including
the proposed 40,000 square foot expansion, if the increment would change. Martha
Ingram, Kennedy & Graven, confirmed and noted that the TIF district would need to be
amended.
Jim Thares explained that tax abatement has never been used in the City of Monticello.
Tammy Omdal gave a detailed presentation of what tax abatement and TIF were and how
they could both be used for the project. Tammy noted that in an exhibit of the agenda a
preliminary TIF calculation was determined.
Darek Vetsch noted that the City of Otsego is currently completing the process for
establishing a Tax abatement agreement in which Wright County has been asked to
participate. This is Wright County's first project like this.
Thares reviewed the timeline of events for everything to go as expected. The schedule
indicates that it may be possible to conclude all approvals by late November, 2019. This
would still allow UMC to start grading if weather conditions permit. Several meeting
attendees believe the timeline may be too aggressive.
Discussion pursued regarding the TIF and Tax Abatement schedule. It was noted that the
TIF District would last nine years and the Tax abatement policy could set up for a 15 year
agreement, although it does not appear to be needed for that long based on the analysis of
the overall investment and land costs. Darek Vetsch clarified that it looks though both
the City and the County would need to allow approximately $120-$125,000 of tax
abatement assistance to be provided to the project. Tammy Omdal confinned this was
correct.
Thares asked if the County was optimistic about establishing the tax abatement policy.
Vetsch noted that this project was smaller in scale than Otsego. Vetsch explained that a
preliminary request from the City should go to the Wright County board on September
9th. He will follow up with more meeting details.
6. Consideration of Memorandum of AF-reement (MOA) for Public Works use of 112
West River Street
Jim Thares explained that the Park's Department has indicated that they are in dire need
for additional space. They have approached the EDA to consider allowing the Park's
Department to use the space at 112 River Street. Thares explained the attached MOA that
spells out the responsibilities of both parties. It was noted that the EDA, as they have
requested, would incur no legal or building operational costs because of for under the
proposed MOA.
Brian Stumpf noted frustration with holding the City to less than the same standards as
the general public. He suggested that Public Works complete an inventory of their
equipment and liquate anything that was unnecessary. Concerns with grandfathering were
mentioned.
Angela Schumann explained that the parcel was zoned CCD and public use of the
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building is permissible.
011ie Koropchak-White explained that the goal is for the building to stay in a substandard
condition to allow it to qualify for a future Redevelopment TIF District.
TRACY HINZ MOVED TO AUTHORIZE ENTERING INTO THE MOA BETWEEN
THE EDA AND THE CITY PUBLIC WORKS DEPARTMENT FOR THE
TEMPORARY USE OF A VACANT GARAGE FACILITY LOCATED AT 112 WEST
RIVER STREET. JON MORPHEW SECONDED THE MOTION. MOTION
CARRIED, 6-0.
7. Director's Report
Jim Thares provided the Economic Development Director's report. He offered an update
regarding Ausco Design. It was reported that Wright County Economic Development
Partnership (WCEDP) would approve a loan of $21,750 to Ausco for the purchase of real
estate and building upgrades. The approval is contingent on the EDA also participating
with a gap loan of the same amount. Duane Northagen, WCEDP Executive Director,
said if the EDA approves its loan, he will take the next step and present the WCEDP
proposal to the Wright County Board.
The EDA asked for building inspection reports and conceptual plans. It was noted that
the item would consider formal review at the EDA regular meeting on September 11.
8. Adjourn
JON MORPHEW MOVED TO ADJOURN THE MEETING AT 8:10 A.M. OLLIE
KOROPCHAK-WHITE SECONDED THE MOTION. MOTION CARRIED, 6-0.
Recorder: Jacob Thunander -9T
Approved: September 11, 2019
Attest:
im T*res, Economic Development Director
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