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EDA Minutes 07-19-2001 . . . MINIJTES MONTICELLO ECONOMIC DEVELOPMENT AUTHORITY l'hursday, July 19,2001 - 4:00 p.m. City Hall - 505 Walnut Street Members Present: Chair Bill Demeules, Vice Chair Barb Sehwientek, Assist Treasurer Ken Maus, Clint Herbst, Ron Hoglund and Darrin Lahr. Members Absent: Roger Carlson Staff Present: Treasurer Rick Wolfsteller, Executive Director Ollie Koropchak, Recorder Lori Kraemer. Guests: Steve Grittman, Northwest Associated Consultants Pat Jensen, EOMA Company Bruce Hamond Pam Campbell, DA T Chair I. Call to order. Chair Oemeules called the meeting to order at 4 pm. 2. Consideration to approve the June 19.2001 EOA minutes. Ron I loglund stated that there was an error in item 5 of the minutes, the address listed should state 207 Pine Street. A MOTION WAS MADE BY RON HOGLUND AND SECONDED BY CLINT HERBST TO APPROVE THE MINUTES OF THE JUNE 19,2001 EDA MEETING WITH THE CORRECTION AS NOTED. Motion carried unanimously. 3. Consideration of adding or removing agenda items. None 4. Consideration to hear results of meeting between Block 35 property owners as presented bv Consultant Grittman and consideration to authorize DMRF funding. Ollie Koropchak. Executive Director, advised that at the June EDA meeting. Consultant Grittman presented two design concepts for the rear of the huildings on 13loek 35, the objective heing to create uniform parking and common trash areas. The EOA suggested a third option: a rear plaza concept. The EOA to evaluate the potential to participate with the funding suhject to cost estimates and willingness of property owners. Grittman was directed to l11eet with property owners, prepare cost estimates, and report back to the LDA Minutes - 07/19/01 . EDA and DA T was invited for input. Steve Grittman reported on his meeting with two of the business owners, Al Loch and Marn Flicker, and presented their concept to the EDA. Steve provided drawings for review as well as estimates provided by WSB showing two possible alternatives. (i-rittman stated the difference was adding in concrete sidewalk and curb/gutters or paint existing pavement and use curb stops. Grittman stated the difference in cost would be about $25,000. Cirittman added that Loch and Flicker expressed a concern regarding drainage and a general doubt that if this was a feasible project. Grittman discussed their concept of having remote dumpster locations in the existing parking lot and leave the linear parking showing the layout they provided which would be essentially the same as the option Grittman had presented. He noted the problem with having the dumpsters located in the City parking lot would be that they are somewhat remote, and Flicker had stated they have semi trailers backing into that area as well which may make access difficult. Grittman stated he felt comfortable that the business owners liked the design. Koropchak asked if the other business owners had stated an interest and Grittman stated that according to both Flicker and r ,och, they felt the others were interested and it was more of a scheduling conflict that kept them from attending their meeting. . Barb Schwientek stated a concern with Dominos and if they would be willing to use the dumpsters as well. Grittman also added that the City wanted the businesses to he part of an agreement, didn't think the common dumpsters would work but separate containers within the enclosure would work. Pam Campbell, DAT, asked if they mentioned dumpsters in the City parking lot as she stated she thought the City's parking lot was not rated to handle that size vehicle which Grittman concurred. Regarding snowplowing concerns, it was stated that the EDA would be helping the businesses improve their sites with the idea that the businesses would still maintain them. Schwientek asked if an agreement could be drafted based on what was presented and get together with the owners to get a consensus of agreement. Bruce Hammond stated that the same type of concept was heing done between Locust/Walnut, the businesses got together and reviewed some concepts and the owners signed off on a letter of intent the idea being there is preliminary approval of the owners on that block for moving ahead on the concept, then coming back to owners with ideas and costs. Grittman asked about the feelings of the EDA toward the concept presented by the businesses and his concept of combined, head in parking. They stated they liked it, but . 2 . . . ELM Minutes - 07/19/0 I would like to tnove the dumpsters away from the parking. Regarding the concrete and curb, the businesses felt that the grade is slight and would not be possible to create a raised sidewalk as this may create a drainage problem. 'T'hey suggested to possibly cut out the existing bituminous and put the concrete there, maintaining the grade. The EDA suggested to possibly incorporate a barrier such as a small fence and pots to differentiate the parking. Campbell asked about drainage coming off the roofs as well and what that may due to the design. Grittman stated the business owners were concerned about having landscaping too close to the bui Iding due to the run ofT from the roofs, but he stated the concept most likcly accommodates that issue. A MOTION WAS MADE BY BARB SCHWIENTEK AND SECONDED BY RON I 10GLUND TO AUTHORIZE STEVE GRITTMAN TO PREPARE A LETTER OF INTENT FROM THE EDA TO THE PROPERTY OWNERS THAT WOULD PRESENT THEM WITH THE CONCEPT PROPOSED BY GRITTMAN, LOCI I AND FLICKER TO GET A COMMITMENT FROM THEM TO WORK WITH TilE EDA FOR FUTURE IMPROVEMENTS WITH 'THE REALIZATION THAT 7Ylfo TO 100% OF THE COST WOULD MOST LIKELY BE PICKED UP BY THE EDA. GRITTMAN WAS ALSO ASKED TO MEET INDIVIDUALL Y WITH THE OWNERS WHO COULD NOT ATTEND A JOINT MEETING. Motion carried unanimously. 5. Consideration of a request to amend terms of the Loan Agreement for DMRF Loan No. 111 between the EDA and VisCom, Inc. Koropchak advised that Bruce Hamond, VisCom, Inc., is requesting the EDA amend the terms of DM RF Loan No. 111 and also noted that on November 8, 2000, the DMRF non- perf4JrmanCe date was extended from May 29, 2001 to August 29, 2001. Koropchak attached the amortization schedule based on the loan agreement and a copy of the loan payment of June 22, 2001, and a note attached to the payment requesting the amount of the check be applied as interest only for June and July. The Finance Department suggested not accepting the payment until the terms of the agreement were reviewed by EDA. Mr. Hamond addressed the EDA and stated he would like to get away from writing a check every month for $115.78, ,and would like the option to either pay one check for th~ year tor interest (balloon in 3 years), at end on years paying the balloon, or pay one check fl)f interest in 6 months and the next check at the end of the year would be principle for the year. Has no problem paying the interest up-front. Hoglund questioned re-writing the amortization schedule, stating there would be additional interest, but Hammond did not think it was significant enough. The EDA 3 . . . LOA Minutes - 07/19/01 stated the loan agreement would have to be amended. Hamond asked if the loan agreement specified the payment of principle and interest, but it was noted that the agreement stated only the way the loan is to be paid. Ken Maus stated his concern with additional attorney's fees for drafting papers. Hamond stated he did not want to go through an amendment to the agreement, he would rather pay in advance for principle and interest. City Administrator Wolfsteller stated that would not be a problem as the loan agreement doesn't state that it can't be done. No action was necessary, Mr Hamond will make one payment for principle and interest annually. Koropchak also advised that Hamond is requesting an extension to September/October fl.)!" the exterior of his project. The contractor will finish this project with another project in that area if that one is approved by the City. Koropchak asked if 6 months would be sufficient and Hammond stated that it was. A MCrfION WAS MADE BY KEN MAUS AND SECONDED BY RON HOGLUND TO EXTEND THE NON-PERFORMANCE DATE Of AUGUST 29, 200 I TO MAY 29,2002 FOR DMRF NO. III (MATCHING GRANT) BETWEEN 'fHE EDA AND VISCOM, INC. Motion carried unanimously. 6. Consideration to review tt)r discussion the preliminary GMEF loan application for EDMA Company. Pat Jensen, Applicant. Koropchak introduced Pat Jensen, the President and 51 % owner of EDMA Company. The company is six years old and leases space in Eden Prairie. The company is a small machine shop which does engineering, design, machining, and assembly. This business will occupy 5,000 sq ft of the proposed 10,000 sq ft metal building with rock front. 'r11e remaining 5,000 sq It will hOLlse a new business specializing in maintenance of and leased indoor-storage ofrecreational trailers. The company requires no outside storage. The proposed builder is Unlimited Trades of Rogers, MN. Request is tl)r a $30,000 real estate loan. The Prospect Team of Kevin Doty, Ron Hoglund, Brad Barger, and Koropchak visited the existing plant in June. The company has a Purchase Agreement with Carl and Eric Bondhus 11.)1' a lA-acre parcel to the north of Lake Tool. The project will create 3 new jobs tl11' the City of Monticello within two years. Koropchak worked with Mr. Jensen's lender as well who is working with SBA. "fhe EDA advised Koropchak to add in the late payment policy for the attorney when he completes the loan agreement. No action was necessary. 4 . . . ED^ Minutes - 07/19/01 L Consideration to approve or deny GMEF Loan No. 019 for EDMA COnlpany. After review and discussion of the preliminary application from EDMA Company, the EDA was asked to consider approval or denial of the request t(H a $30,000 GMEF loan. The lender, Western Bank, has provided a copy of the Bank's commitment letter which is subject to SBA approval and other int(Hmation. The City Council will consider ratification of the EDA's action for compliance of the EDA-GMEF Business Subsidy Criteria on July 23,2001. If approved, the GMEF will be disbursed at the closing date yet to be determined. After the EDA reviewed the application it was found that the applicant meets all necessary criteria. A MOTION WAS MADE BY DARRIN LAHR AND SECONDED BY BARB SCHWIENTEK TO APPROVE GMEF LOAN NO. 019 FOR LLC DBA EDMA COMPANY, IN THE AMOUNT OF $30,000, WrrH THE TERMS OF 20 YEARS, 4.7YXI INTEREST, BALLOON IN 5 YEARS AND A LOAN FEE OF $200. COLLATERAL, GUARANTEES AND OTHER CONDITION REQlJIREMENTS TO BE DETERMINED AND PREPARED BY THE GMEF ATTORNEY. THE GMEF LOAN APPROVAL IS SUBJECT TO SBA APPROVAL AND COUNCIL RATIFICATION OF EDA ACTION. Motion carried unanimously. 8. Consideration of Executive Director's Report. Koropchak provided the report. Sehwientek asked about the status of the Chamber building facade improvements and Koropchak stated that Drayna was very busy at this time had not begun the work. They were authorized to go ahead with the paint on the McCarty building as well. a. Schlief House - Closed on Contract for Deed on June 19, 200 I. TIF Dist. No. 1-12 (Aroplax) - Payment received on TIF loan with City. 225 Front Street - copy of appraisal for land only. Integrated Recycling 'fechnologies - closed on the project at the 21 st Century Bank in Rogers on .J une 29, 2001 . Red Wing Foods - Koropchak stated her understanding that the company has elected not to purchase the H- Window or Fay Mar building. FDMA Corporation - small machine shop in Eden Prairie has purchased agreement with Carl/Eric Bondhus for construction of a 10,000 sq. ft. building. 3 new jobs to Monticello. Prospect team visited company. Production Stamping - is still holding off to see how economy is. International Cup - Lead from Ron Hoglund, referred to Fay Mar building t(H b. c. d. c. f. g. h. 5 . . . FDA Minutes - 07/19/01 I. lease or sale. Company decided Monticello was too far out. Industrial Molded Rubber - Plymouth light rubber coating mfg. Lead fi'om Xcd Energy. Decision on hold. Quick 1'1 F 2000 is here so will begin working on that. Tax increment for first halfof2001 available but have questions of the county. Notilication of Fay Mar MACA penalty - upon receiving 1'1, it may be beneficial to pay oll debt and decertify district. Previous St. Henry's site - it appears the concept present by John Komarek is not materializing as Tom St. IliIaire is presenting a new concept to the Planning Commission. Marketing Committee meeting July 26 at 7:30 a.m. LEAD - 60,000 sq ft building - Olson General Contractors. Company is located in a community that may not re~zone property for this company to expand; ifnot they will have to look elsewhere. HRA - looking at increasing wages. Checking on other cities at this time. J. k. I. m. n. o. p. 9. Other Business. None 10. Adiournment. A MUflON WAS MADE BY RON HOGLUND AND SECONDED BY CLINT HERBST TO ADJOURN THE MEETING AT 5;30 PM. Motion carried. 6