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EDA Agenda 10-28-2003AGENDA MONTICELLO ECONOMIC DEVELOPMENT AUTHORITY Tuesday, October 28, 2003 - x:00 p.m. City Hall -Academy Room MEMBERS: Chair Bill Demeules, Vice Chair Barb Schw•ientek, Roger Carlson, Robbie Smith, Clint F{erbst. Ron Hoglund. and Darrin Lahr. STAFF': Treasurer Rick Wolfsteller and Executive Director Ollie Koropchak. DUES"T'S: Block 3~ Property Owners. l . Call to Order. 2. Consideration to approve the May 27, 2003 and July 29.2Q03 EDA minutes. 3. Consideration of adding or removing agenda items. ~. Consideration to hear response from Block 35 property owners relative to the EDA design concept and financial package offer ofJuly 29 and then determine next step. • 5. Consideration to hear proposed renovation and expansion plan For Block 3b. 6. Executive Director's Report. 7. Other Business. 8. Adjournment. • AGENDA MONTIC'F.LLO ECONOMIC DEVI+:LOPMENT AUTHORITY Tuesday, October 28, 2003 - 4:00 p.m. C.'ity Hall -Academy Room MEMBERS: Chair Bill Demcules, Vice Chair Barb Schwientek, Roger Carlson, Robbie Smith, Cli~it Herbst, Ron l~oglund, and Darrin Lahr. STAFF: 'Treasurer Rick Wolfsteller and Executive Director Ollie Koropchak. Gi1ES'1'S: Block 35 Property Owners. 1. Call to Order. 2. Consideration to approve the May 27, 2003 and July 29, 2003 EDA minutes. 3. Consideration of adding or removing agenda items. 4. Consideration to hear response from Block 35 property owners relative to the EDA design concept and financial package offer of July 29 and. then determine next step. 5. Consideration to hear proposed renovation and expansion plan for Block 36. 6. 1?xecutive Director's Report. 7. Other Business. 8. Adjournment. • MINLI"I'F;S -SPECIAL MF.FTING MONTICELLO F,CONOMI(~ DEVELOPMENT AUTHORITY Tuesday, July 29, 200;1 - 7:UU p.m. Mississippi Room Members Present: Chair Bill Demetiles, Roger Carlson and Assistant "Treasurer Ron l loglund Absent: Robbie Smitll, Clint Herbst, Barb Schwientck, atld Darrirl Lahr Staff Present: Executive Director Ollie Koropchak, 'T'reasurer Rick VJolfsteller, Public Works Director •Tohn Simola, City Planner Steve Cirittman and Recorder Lori Kracnrer (ittests: Alan T,ocl~, Susie Swiecichowski, Larry Nordmann, Dar Flatten, ,lim Agosto, Doug Schneider, Pam Ca-~npbell, and. Susie Wojcl~ottski Chair Dctnettles welcomed everyone to the EDA's presentation Tor Block ~5 and advised of the purpose of the presentation. 1 le stated that approximately two years ago the EDA began discussions ot~ possible itliprovements to Block ~S and the focus ai that time had been on trash enclosures in the rear of the buildings with discussions expanding from there. Demeules encouraged those present to ask questions and give their input throughout the presentation.. Steve Cirittman, City Planner, presented several concept plans, including before and after drawings, and explained that the EDA's first objective was to address the back entrances and public parking area by trying to organize the site. 1-1e fitrtl~rer advised that if owners and tenants could agree on a pattern, they could consolidate the area and dress it up to make it more positive and customer based. Cirittman then explained concepts for alley access, trash enclosures, playa design, and cosmetic fa4ade improvements. Cirittman stated that after hearing comments from several property owners and tenants, their idea was to move the trash receptacles away from the back entrances and create a playa with parl.ing on the north side of tl~e parking lot. He further noted the need for alley access for trucks, advising chat the parking lot was not constructed to accommodate heavy truck traffic. "l'he second area ol'conccria was the desire to make the parking space appear to be t11e parking for each individual building and moving trash receptacles in line with existing planters ilnCl accessible from i.he alley. ~Tl~is would redefine the parking, btri would reduce the parking spaces by approxirnatcly 4 or 5 stalls. Grittman advised that the City F,ragineer had also reviewed this concept plan and iricltided his input regarding stormwater and drainage. Ci•rittrnan summarized by stating that this would be an opportunity to take the buildings and create a rnorc organized fool., along with architectural enhancements, drainage o11`the buildings, and possibly add a tniilied strip oT`customer signage for parking with entry emphasis on doorways. 'T'here was discussion rcgardirig improved access, replacing existing trees with shrubbery or other low maitltenance plant materials, as the trees in that location in the parking lot block visibility to the buildings. There was some concern on the number of trash receptacles and the fact that Borne buildings have a much higher volume oT~trash than others. It was noted that there was ample space for receptacles and that cacl~ owner would be responsible for their own. 'l~he contractor for special Rt)A Meeting/Block 35 presentation - 07/29/0 i trash picl: up would bill individually, based. on volume. Arl rleci versus head-in arkin 7 was also discussed and Crittman ~.rdvised that head-in is more :; p cfflcicnt anal would give them a greater amount of parking. 1 Ic further added that head-in parking gives the ability to bacl: out in either direction and maximizes the number of spaces. There was further discussion on the parking and the desire by some of the owners/tenants to keep parking closer to the buildings. It was suggested that they could sign the parking lot for customer parking and Al Loch indicated that 80`% of his customers access his building from. tlae back versus Broadway. Pclblic Works Director .lohn 5irnola then i)afornied them of possible parking lot improvements including patching, grinditlg and overlay, with an estimated cost of $30,000. He stated that the lot was not initially constructed for the weight of trash vehicles and the need to strip the lot and add asphalt if they wanted truck access. Fle added that the city wants the parking lot to be free flowing for pedestrians, as well as 1`or city snow removal. Simola stated that the city is in the process of deepening the storm sewer, from. ; ft. to 7 ft. or 8 li., and they could further extend the lines to the buildings, stating that the current lines are shallow and tend to freeze. He further advised of possibly extending plastic lines to individual buildings for drainage. He advised that they would not need to repl~:rce the parking lot with concrete, however replacing with another material would give it a shorter life span. Simola advised the cost to replace concrete and extend pipes would be approximately $_50,000. Doug Schneider commended the city on their snow removal process and timeliness. Executive Director Koropchak provided uses and sources for a financial package offered by the l?DA. The information included cstinaates of costs for facade improvements for tlae individual businesses, basal on a contractor's estimates, and advised of the EDA's matching grant funds anal low interest loans available to the business owners. "There was discussion on how the EDA arrived at the costs and if the business owners would be allowed. to use another contractor. (rittman advised that the project would most likely go out for bids and if the costs came in higher, the ED11 would not move forward without coming back to the business owners for their approval. Koropchak advised that the ED11 would. need commitments from the businesses ofi their willingness to participate, and tl~e need for 100% of owner participation for the proposed project to move forward. There was further discussion regarding 1`a4ade improvements being extended on corner buildings to match the back; unrestricted parl.ing and the nCCCI for QI1L' blrslnCSS OWnCI- to haVC a space designated for her catering truck for loading/unloading purposes; maintenance agreements among the business owners clad agreements with the EDA; and a possible lru~numcnt sign advertising the individual b~rsinesses. It was noted that out of the 7 business owners, S were present and 1 advised that he was unable to attend, but would like the information mailed to him. City Administrator I~ick Wolfstcllcr advised of F3roaclway road anal utility costs to tl~e business owners, above the cost of the proposed improvements, stating assessment rolls will go out this fall which will al=feet all business and hone owners on Broadway. He advised that the city council would like a policy in place for assessing so that it is a fair process for everyone affected. Special E[)A Meeting/Block 35 Presentation -- 07/29/0 Wolfstellcr estimated the cost. per unit for corYlnacrcial businesses to be approx. $70.00 per foot, assessed over a 10 year period, at approx. 5/8 percent interest. l le advised that this was the cost of street replacement Drily and did not include trtility work, which would. be covered by a trunk fund. He further advised that the city is required to assess at least 20% of the entire cost. He stated. there would be additional irifor•mation Isom the city council over the next several months. It was the consensus that the building owners/tenants would meet on their own to further discuss the proposecl project and Koropchak would provide the information ors the estimated costs she had. received. They would cor~re back to the 1/[)A in ()etober with their decision. CTrittman advised that the drawings would he available to there. for further review. Koropchak encouraged them to contact her with arxy further questions, advised of a January 1, 2004 deadline for the business owners to decide whether or not to proceed, and thanked them for attending, the presentation. The presentation concluded at 9:50 p.m. ~~ ~C~ ~ 9~ ~ ~- `~ Lori Kraemer, Recorder • C7 3 F.,DA Minutes - 0.5/?7/03 MINLITES MONT1(ryF..LLO ECONOMIC UEVELOPMFNT AUTHORITY Tuesday, May 27, 200:1 - 4:UO p.m. City Hall -Boom. Island Room Members Present: Chair 13111 Demeules, Vice Chair Harb Schwientek, Roger Carlson, Robbie Smith, Clint Ilerbst, and Darrin Lahr. Absent: Assistant Treasurer Ron Hoglund and Treasurer Rick Wolfsteller Staff Present: l-~xecutive Director Ollie Koropchak and Recorder Lori Kraemer. (.'all to Order. Chair Derneules called the meeting io order at 4:10 p.m., noting that F,xecutive Director Koropchak would be arriving shortly. ?. Consider~.ition to a rove the A ril 22 2003 EDA minutes. i A MOTION WAS MALI; BY 13AR}3 SCHW[FNTEK TO APPROVE THl/ MINti"l'1/S OF T}-I1~: APRIL 22, ?003 ANNUAL ME}~;'1'ING. ROGER CARLSON SH:C'ONI)F;I) '1'I IE M01'ION. MO~'ION CARI7Il•:I) WITH CLIN'I' HERBS'1' AI3S"TAININ(T. Consideration ol'addin or removin 7 a 7enda items. None 4. Continued -Consideration to review cost estimates for rear cos~neiic Iacadc im rovements to Block 35 and io determine tlext ste . AI`ter reviewing the information submitted by Mike Cyr regarding estimates for facade improvements, there was discussion on the costs and what were included in the estimates. They discussed possibly taking the common area and breaking; it out to see the costs per building, as well as possibly taking the full cost. and dividing it by the number of properties. They further discussed who they felt might be willing participants and it was advised that Dominos was not a willing participant at this time. Korpchak arrived and noted that Steve Gritiman, or another representative From NAC, was expected to be present, as well as Mike Cyr and a representative from DAT. it was clarified that the common area would include all properties but the EI7A would have to have the property owners consent to proceed. Koropchak advised that ownership of the alleyway was never determined, however they were going with t11e assumption that it is divided down the center of the alley. EDA Minutes - 05/27/03 Herbst asked if there were plans for the vacant. lot and Koropchak advised that the owners had been in and talked with ,Icff O'Neill and herself about building on that lot, a.s well as possible TIF assistance, although she advised that TIF could not be Liscd as currently thet•e is rw building on that site. She suggested possibly trading buildings with another property owner and there TIF could be used. She advised that Grittrnan did not see construction of a retail building along Walnut Street as an option as he felt tl~c City needed to keep that lot for present and future parking. It was also noted that the UA'I' had reviewed the fence that Snydcr's had erected and determined it was for liability purposes as initially stated by the owners. Koropchak added that sloe did not invite building owners to this meeting as she wanted to wait until the EDA had met and talked with CTrittrnan. She also noted that they may not want to proceed with anything due to the consirr.iction on Broadway at this time, as well as the core street reconstruction coming up. Herbst stated he felt this is a great idea but feels that if the EDA is putting in public money they need some type of return and would need support of the business owners. Koropchak advised that initially the EDA wanted to gee the costs and present something to the owners, working on a partnership or some type of agreement, and that the EDA would do this with the support of the business owners. "1"hey discussed that. possibly they need to put a time Irame on it as well. Herbst agreed with that but he felt it was not worth dressing up the common area and nothing else with the remainder ol`the property. He felt it needs to he all or none and should be done all at one tune, with possibly the property owners portion assessed back to them. Derneules stated they can't really assess this, so 1 Icrbst suggested maybe offering them an I~,17A loan with a lower interest rate. Koropchak advised that they would then have to re-establish the downtown rcvitali~ation lo~.rn program, and also felt that the costs wor.ild be eaten up by doing the trash enclosures, etc. They further discussed the costs for- improvements being high, especially if they needed to address drainage and curbing issues. It was stated that the business owners did not necessarily feel they had a drainage problem. There was discussion on proceeding with presenting inforrnaiiotl to the business owners or possibly holding a meeting where they present the information to them. Smith and 1 Icrbst felt that they should send the infi~rrr~ation out prior to meeting with them which might save tune for both the EDA and business owners. Herbst added that the EDA only had $14.5,000 at this time to work with. Koropchak also stated she would have Grittman revise the plans to include the property that was Ieft out on the initial plans. It was l~uriher discrssed that the EDA could be lool<inl; at possible low interest loans for the business owners portions and that they worild need to include all the properties at one time versus individually to make it feasible. They also discussed that this would have to be put to bids and that Koropchak should discuss with (:yr the estimates he provided. Her°bst questioned the possibility of not paying the Liquor Store fund back at this time EDA Minutes - 05/27/03 and use some ol'tliat money for the loans. 'I'l~cy also suited that 50% ol'the business owners would need to pa--ticipate. It was the consensus to send out invitations to the business owners, inviting them to a meeting possibly on a "I'ucsday evening around 7 p-n. Koropchak advised that she would not put an offer on the invitation, but rather state that the EDA would have an attractive package. She would request their to RSVP. It was tiirther advisecl that the EDA has $14.5,000 available for al Icy improvements and trash enclosures, and possibly the EDA could obtain a low interest loan for the rest. The EDA was in agrccrncnt with this, although it was advised that they would need some type of guarantee. A MO PION WAS MADh: BY GLINT HERBS"1' "1'O ACCEPT COSMETIC DESIGN SKETCI IE:S E'O[t REAR FACADE: IMPROVEMENTS AND COS"I" E;S'I'IMATES AS Si1BMITTED BY NAG', DETERMINE WI IA'1' THE EDA 1S WILLING'1'O E'C7ND, ANI) INVITE THE BUSINF,SS OWNERS TO A NRE;SENTATION. BARB SCHWIENTEK SI~.CONDED THE MO"PION. MOTION ('ARRIED UNANlMOi1SLY. Koropch~.ik asked for clarification as to whether she should prepare this as a total package. or soar~cthing other. She was advised to prepare a financing package offering low interest loans, as an example. 5. Consideration of EDA updates: a) Refinance of GMEF Loan No. 014 - T. J. Martin, Inc. Koropchak stated she had the agreements fin- the supplemental loan agreement, but they have not been in to sig~~. l7) Rec uest to re- a. GMEF Loan No. 018 - IRTI. Koropchak advised that this should be done in .lone. c Rc uest to re-_a CiME;E' Loan No. 017 - "I'('L)C. Koropchak advised that there is no penalty for prepaying. She also spoke to Mr. Harmon. and they are requesting to pay the 1?[)A loan. She noted some penalties on tlac City loan, Harmond wants to bold off on that at this time. This could be extended also. 'fhe worst scenario is if'he did not meet the low to moderate income levels -the entire $500,000 would have to be paid back to the state. "I'hcy are contemplating going to the Council to pre-pay the city loan. She noted that they are hiring less but hiring at higher pay rates which is a benefit. No fitaancial penalty to either T('DC or the EDA/C.'ity. (. Executive Director's. kcport Regarding the legislative bill, Koropchak slated that Rcp. Mark Olson called her late Friday and stated he did not get her fax but had received her voice-mail. He stated 11e would try to introduce the bill if the city adjusted it to state the S year rule would not EDA Minutes - OS/?7/03 apply to I31ock _52. She spoke to the attorney and 1 IRA Chair Andrews wl~o agreed to this. She forwarded it to Olson and will follow-up. The HR11 Attorney felt at Icast we could do pay-as-you-go with a TIr district. Koropchak stated she is working with Marketing Committee on a new ad. 7. ()thee B~rsirtess None 8. Aclj~urnn~ent A MUTIUN WAS MADE BY BARB SCHWA-:N"I'I?K 7~0 AD.lUL1RN THE MEETING AT 5:10 N.M. ROBBiF, SMI'I-'FI Sh,CUNDED THE MUTIUN. MO,L"ION CAKRIED UNAN I M Ol_I SLY. Recorder _ -- r~ L_J 4 EDA Agenda - 10/28/03 4. (,onsideration to hear res once from Rlock 35 ro ert owners relative to the F.DA deli =n conce t and financial acka a offer of Jul 29 and then determine next ste . A. Reference and back round: Based on the direction of the EDA, a meeting was held with the property owners of Block 3S in July. 'Chc EDA offered a partnership financial package (see attachment.) and Cirittman presented the design concept. At the October EDA meeting, I31ock 35 owners will give an update on their progress to meet the FI)A commitment date: 100% commitment from said property owners by January 1, ?004. Determining a next step will depend upon their progress. • C BUSINI~:SS OWNI_;R/EDA PARTNERSHIP lU0% c~ c namitnacnt from sa~cl property owners by January I, 2004. Property owners eiater into a Maintenance Agreement for Common Area. IJnrestricted parking spaces Comiaaon 'brash Snow flowing Landscaping Agreement recorded against property Low Interest Loan Agreement. with EDA Guarantee Required • SUMl~, B~;NErITS OI~' EDA OI~'rER Custom friendly parkin; and plaza-like rear entrance. Cosmetic Facade Desi~,n Benefits as outlined by Planner Steve (irittman. 3. Roof and alley drainage issue a•esolved. 4. Multiple visual and exposed trash containers eliminated from rear entrance. Ratio of Public Investment ($175,000) to Private lnvestmeni ($129,700.) 1. X5:1.0 6. ~lvailabiliiy of I-;DA Low Interest Loan. • (rl'his a proposal created and ollered by the Monticello Economic Development Authority (EDA) to foster a partnership with a portion of the owners of Block 35.) BLOCK 35 AND EDA PARTNERSHIP FINANCIAL PACKAGE USES OF FtJNI7S -Based on cstirnates. Common Area Parking to rear of buildings, plaza, trash itnproveinents (with sidewalk and cu--h) $ 75,000.00 Replace alley and add a second catch basis (Without engineer ices or cost to slope private surl~ice to match alley) $ 50,000.00 (Engineer Lees/sloping) $ 20,000.00 Block 35 Public Narking Lot Improvements $ 30,000.00 Cosmetic facade Improvements to wear of buildings Swiecichowski (Dino's) $ 15,100.00 Monticello bodge #16 (Vacuum Center) $ 21,100.00 loch Jewelers and (1" National Bank of Elk River) $ 17,500.00 Schneider (previous Office Supply) $ 18,000.00 Agosio (Law O1~Iice) $ 10,500.00 Schneider (Vacant l ,ot) Larson Properties (C'arlson TraveUCarlson Agency) $ 20,500,00 Schneider (Drapery Center and I'iz~a) $ 10,500.00 McCarty (Computer/Mexican Grocery) $ 16.50(_).00 Subtotal of Rear Cosmetic Facade improvements $129,700.00 TOTAT, LISES (~l~' l' UNDS $304,700.00 • sorllzcES oH~ I,~UNDs • CJ EDA - (,ommon Area Alley N:ttgineer Fccs/Sloping Subtotal EDA Investment $145,000.00 City of 1Vloa~ticello -Public Parking Lot Improvements Budget 2000 $ 10,000.00 Budget 2002 $ 20,000.00 Subtotal Ciiy Invcstmenl $ 30,000.00 Business Owners - Kear Cosmetic Facade I~a~provements Swiecichowsl:i $ 1.5,100.00 Monticello Lodge # 16 $ 21,100.00 Loch ,lewelers $ 17,500.00 Schneider $ 18,000.00 Agosto $ 10,500.00 Larson Properties $ 20,_500.00 Scluleidcr $ 10,500.00 McCarty ~; 1$~00~00 Subtotal Easiness Owners Investment 'TOTAL SOl1RCES O}i' FUNDS $ 75,000.00 $ 50,000.00 $ 20,000.00 $179,700.00 $104,700.00 El)A Agenda - lU/28/03 . 5. Consideration to hear . ro osed renovation and cx ansion lan for Block 36. A. Reference and back round: At the request of Mr. I Iamond, this proposed renovation and expansion concept plan appears on the EDA agenda. Bruce plans to renovate the existing building on Lot 8 and construct a structure on vacant I~Ot 9, Block 36. Ile is working with. Claybaugh Preservation Architects for design of the exterior facade improvements and Contractor Mike Cyr. The front facade would give an appearance of a single building. Plans are I`or first Moor office/retail and second floor housing or office. Perhaps the foundation will be poured this fall with construction completed in 2004. Funding approved thru First Minnesota Bank. Mr. Hamond had planned to attend the Ii:UA of October 28; however, now is out-of--town. [-Ic requested 1 inform the 1/UA ofhis proposed project and is requesting a special meeting of the 1/DA on 'Tuesday, November 18. He and Mike Cyr (perhaps Cla.ybaugh) will present their concept, construction drawings, and funding. Ile is requesting matching facade dollars. Mr. flamond has been informed that the DMRI~' program no longer exists and of the intended use of the remaining DMRF Ior Block ~5. Others who inquired of matching liuids:.lames & Ciruher and Dennis Anderson. Mr. 1 larnond is current on the Visicom Loan payment. ~"he three-year balloon payment is due May 2004. The proposed project is consistent with the downtown revitalisation plan. With the use of TIF assistance for Landmark Square Phase 1, redevelopment projects arc intended to create other spin-off development. What are yoLir wishes? Will you meet of November 18`? Replace existing storefront with new wood-framed storefront with center entry. Add on entry and display window on the west facade, Add new stripped fabric owning over new storefront (not shown). Awning should start at top of transom windows and extend to the edges of the storefront opening. Remove second floor window shutters. Move air-conditioning unit and heater vent to the west building facade. Remove existing siding and replace with new painted wood siding. Reconstruct wood cornice. Commercial/Residential Building CH-02 212 West Broadway, Monticello, Minnesota Apr. 10, 2000 ~CLAYBAUGH PRESERVATION ARCHITECTURE INC Proposed Renovation Remove front door and access stair to the second floor. ° 'I ~A 4 ,1 .-p ~ s ~ y ~~ ~y7 gg gg 3 ee~~ gg g gg gg,, i,~Y ~ m ~ ~ vJ C 7~ ~° ~° ~~ ~~ ~~ ~g ~g ~$ ~~ ~~ ~~ I,~ -- J _ - ... -F' ~aaa~5 ~nul~i+ii o~ a; I t d (`~~ Y 330'-0" .~-.ua • 0> Q1 (Y~ti `T1 V L _~ Q ~rn ,v ` 1 ,V, J\ ~ n ~'f" ~7 V , Arlgust ?~, 200 MONTICELLO VisiC'om, Inc. Srctce tend Cynthia I lamoticl 1021 West River Street Monticello, MN 55362 Re: Loan Agreement (the "Agreement") bettiveen VisiCom, Inc. (the "Borrower") allcl Monticello Economic Development authority (the "L,ender") dated April 10, 200] . Dear Bruce and Cindy: On July 19, 2001, the Lender modified the Loan Agreement per the: t-equest of the Borrower approving an annual payment of`principal and interest for DMRF Loan No. 1 11. The EDA thanks you for your June 2002-NIGiy 2003 payment of `1,389.36 received in August 2003. ~ ~'.58 is for the eriod June 1 2003 to A ril 1, 2001. The attached ulvotce to the amount of $1,~7~ p P The payment is due September 25, 2003. Qa~~. Per the Agreement, the entire remaining unpaid balance of the principal and interest shall be due and payable on May 1, 2001. Should you Dave any questions, please call. me at (763) 271-3208. The next regular scheduled meeting of the Monticello El7A is October 2$, 2003. Sincerely, MON"["lC'IL,LO ECONOMIC DEVELOPMENT aU"C'FIORITY C7~:~~nd~~.S~ Ollie Koropchak I?xccutive Director nttachtncnt • C: VLSI~.~On1 I'IlC V ----._._ __.. ,......_._.._T---........ Monticello City Etall, 505 Walnut Street, Suite I, Monticello, MN 55362-8831 • (763) 295-271 I • hax: (763) 29, _ OFfice of Public Works, 909 Coif Course Rd., Monticello, MN 55362 • (763) 295-3170 • F'ax: (763) 271-3272 EDA Agenda - lU/28/03 6. Executive Director's Report. a) TCDC -TCDC pre-paid their GMEF loan on May 31, 2003; therefore, eliminating the need to amend the 6.25`% interest rate loan. Remaining balance paid - $71,623.47. The Council approved the amendments (reduction in job and wage goals and one year extension) to the City/TCDC. Loan. Waiting on preparation of second amendment from Kennedy c~ Graven as requested by the State. According to September 30, 2003 report to State, TCDC currently has 35 full-tithe permanent people employed (42 goal) and 20 (22 goal) I,MI. Average hourly wage $21.21. b) Federal revolving loan fund -Attached is a copy of information Carol Pressley-Olson at the State mailed to me and encouraged the EDA and City to adopt. The EDA would be the LDO (Local Development Organization) of the $500,000 Federal TCDC payback.. "1'he LDO would manage tlae use of the Federal payback and o_ n1y the fiirst re-use of the payback has to comply with. federal regulations. Please read and give some feedback at the meeting. c) IRTI -The lender has notified me that IRTI plans to pre-pay the GMI?h' Loan on October 22. Steve Budd bought-out his two partners and with the GMEF' loan at 6.S% interest rate, lie is refinancing. Previously, the f:DA authorised execution of` the Satisfaction of Mortgage. d) Copy of revised EDA 2003 Cash Flow Projection with TCDC pre-payment. I did check with Wolfsieller as a reminder to apply the $70,000 reduction to the tax levy for payable 2004. Revised balance projected $748,695. Not included is the EDA commitment of $145,000 to Block 35. In year 2004, three balloon payments are due. Aroplax and Mainline Distribution have not made October payment. e) iJMC Opcn Mouse - I hope you were able to attend tlae UMC Open House. Another great asset to the City of Monticello. Genereux Fine Wood Products is hosting an Open 1 louse, 'Thursday, October 23, 3-7 pm, to showcase their upgraded equipment and production li~ae. 'T'his was the result ol`the new equipment purchased and partly landed by the 1/DA. 1) Remmele Engineering Building - I'm aware of three companies looking at this facility. I did make a good k?DA loan offer to a manufacturing company with average hourly wages of $18.50 with 40 employees as an incentive. I visited the company located in Dayton a couple weeks ago. g) Received notice from. Standard Iron & Wire Works that they consolidated their Monticello manufacturing facility to Alexandria and Sauk Center. Up for lease is 36,000 sq ft, 24 fi~ot clear ceiling of manufacturing space with a 5-ton crane. Monticello will remain their headquarters which employs about 50 people. h) FI-Window Building to be auctioned on October 22. i) High-tech medical. company looking at Monticello. j) 20,000 sq fit - manufacturer of granite counter-tops looking to construct between Albertville and Clearwater. k) After initial contact, still trying to connect with high-tech medical company from r 1 LJ F,DA Agenda - 10/28/03 • Canada I~~r meeting. 1) Distribution center for grocer looking at Monticello. m) Attended the Minnesota Development Conference oct 8-lU and (quad County Economic Development meeting October 2. n) The Industrial Land Group made up oI~HRA Commissioner Dan Frie, IDC members Mary Barger and Dick Van Allen, Wolfsteller and Koropchak are meeting weekly to compare industrial sites for acquisition. The group has narrowed it to three sites. Bret Weiss prepared estimated infrastructure costs for each site, received one written purchase offer so far, and will then. have Mark. Kuff run cost analysis. The group plans to submit a recommendation to the LIRA and IDC in. November for support and submission to the City Council on November 1(). "l'he one offer expires mid November. • • ~h~ MNDEED/Business Finance Office . Small Cities Set Aside Funds Program Income/Revolving Loan Fund 7/ 12/02 Pro am Income: The total of all SCDP repayments received by a Grantee in a program yeaz. Program yeaz is defined as September 30 -October 1, which follows the federal calendar. If the program income is $25,000 per program year (principal and interest or repayment from a housing or commercial rehab activity) or less it can be considered miscellaneous income and the Grantee may use the funds as if they were from their own general fund. Of course we would encourage them to use it for community and economic development activities but none of the federal program requirements apply. Revolving Loan,Fund: SCDP program income funds aze sheltered for economic development activities if a Grantee receives more than $25,000 per program year. All repayments (principal and interest, including the first $25,000) are to be placed in a revolving loan fund by the Grantee and federal regulations apply on the reuse. Local Development Organization: anon-profrt organization carrying out the community and economic development activities of a community that is eligible under the State SCDP federal regulations to receive federal funds from a Grantee for purposes stated. Two processes for transfer of SCDP funds to a Local Development Organization: -Grantee applies for a federal grant for a business. Grantee's council asses p a resolution requesting approval to designate a local, non-profit organization (EDA, HRA, etc.) as a Local Development Organization (LDO). City sends request to DTED for approval. DTED sends written approval. Grant awarded. Grant agreement includes statement that LDO will make loan to business. Grantee requests payment from DTED based on invoices from LDO and business. Grantee gives funds to LDO. LDO writes check to business. Repayments come back to LDO and into LDO account. The federal requirements have been met on the first loan to business so LDO does not have to comply with federal requirements on the reuse. We ask for policies and procedures and encourage them to use funds for similar activities but without federal requirements attached. No report comes to DTED. Because the LDO is aquasi-government agency they will be reporting to city council on all their activities. -Grantee has a federal revolving loan fund. The city council passes a resolution requesting designation of a local EDA, HRA, etc. to be an LDO. Sends request to DTED for approval. DTED sends written approval if guidelines met. Grantee transfers specified amount of federal funds to LDO. On the first re-use of the funds, the LDO has to comply with the federal regulations. On the next re-use, the federal requirements do not apply. Grantee's LDO does not have to report to DTED. We ask LDO for policies and procedures and encourage them to use funds far similar activities but without federal requirements attached. Page 2 When a Grantee received authorization to designate an organization as an LDO and transfers federal funds to the LDO, the Grantee cannot recall the funds and they cannot instruct the LDO on how to use the funds. The reality is that the EDA or HRA do work with the city to set up goals for the year and therefore are involved with ensuring the funds are used far community and economic development activities in the City. ATTACHMENTS: Sample Resolution for City Council Sample Agreement between City and LDO for: administration of new project funded by DTED. Sample Request to MNDTED FOR LDO Designation Sample Approval Letter from MNDEED Guide to National Objectives and Eligible Activities for State CDBG Funds; Page 2-68, Categories of Eligible Activities. 24 CFR 570.489 (e)(2)(ii) Revised 2/10/03 Revised 3/6/03 Revised 7/ 17/03 • RESOLUTION OF (Municipality) , Requesting Designation of the (Non_pro~t Or.~anization) as a Local Development Organization WHEREAS (Munici ali (the " ") would like to better utilize the Small Cities federal funds; and, WHEREAS, if the (Municipality)_ _ _ retains these funds and their repayment, the funds retain the federal designation and guidelines forever; and, WHEREAS, the (Municipality) by resolution, can request from the Minnesota Department of Employment and Economic Development (MNDEED), authorization to transfer federal Small Cities Development Program Economic Development Set-Aside funds to a Local Development Organization (LDO); and, WHEREAS, the (Non-pro frt Organization) is interested in being designated as an LDO and is anon-profit organization serving the community and economic development needs of anon-entitlement area; and, . ~ WHEREAS, the Non- ro rt Or anizatian has adopted procedures and guidelines for the use of the federal funds, the repayment of the federal funds plus any interest accrued, earned or paid thereon. NOW, THEREFORE BE IT RESOLVED by the (Municipality) that the City hereby requests approval from the MNDEED to designate the (Non profit Organization) as a Local Development Organization (LDO), serving the community and economic development needs of the City and, therefore, authorize them to receive the repayments from the SCDF Set-Aside loan to (Name of Company.) ,and/or (a portion of the federal SCDF funds in the existing Revolving Loan Fund). I CERTIFY THAT the above Resolution was adopted by the City Council of the City of _(Mi~nicipa_ lily) on the day of. , 2003. SIGNED: WITNESSED: Name/Title Name/Title Agreement between the City of and the Local Development Organization for Administration of Federal SCDP Grant Award to the City by the MN Department of Employment and Economic Development for the Project Grant Number: Project Title: Award Amount: Parties: City of Name of LDO Terms of the Agreement: - City has requested designation of the the Local Development Organization (hereafter "LDO). as - The LDO will administer the MN Department of Employment and Economic Development Grant Award to the City. - The LDO agrees to lend the federal funds to the (hereafter "Company") for the purpose of - The LDO will retain in its possession the principal and interest from the repayment of the federal loan to the Company. - The repayments from the loan to the Company will be used by the LDO to establish a revolving loan fund for community and economic development activities in the geographical boundaries of _ , - The LDO must adhere to the general and special conditions set forth by the Grant Agreement executed by the City and the MN Department of Employment and Economic Development for the project. Approval: The undersigned, as officers of the City and LDO, hereby agree to the terms set forth above: City Title Date (Name of LDO) Title Date DATE • Name of Sr. Loan Officer Address RE: CDAP- Dear Loan Officer: The City of requests that the on- rofit entity be designated a Local Development Organization (LDO). SELECT ONE PARAGRAPH OR BOTH, IF APPLICABLE: A. The City desires to transfer funds ($ from the City's federal revolving lean fund to the LDO. Please find a copy of the Resolution that requests the MN Department of Employment and Economic Development's approval for the designation and the transfer of funds. The City of understands that by transferring these • funds to an LDO, the City gives up control over the funds and cannot recall the funds from the LDO. OR B. Please find a copy of the Resolution that requests the MN Department of Employment and Economic Development's approval for the designation. The LDO, upon approval from the MN Department of Employment and Economic Development, will enter into a loan agreement with (Name of Business .All repayments from the loan will be retained by the LDO. The City and LDO will execute an Agreement for administration of the (Name of Business project until closeout. We understand that the City gives up control of these funds and that the City cannot recall the funds from the LDO. Sincerely, City Administrator • ,~ a~ MONTICELLO ECONOMIC DEVELOPMENT AUTHORITY • GREATER MONTICELLO ENTERPRISE FUND (GMEF) 2003 CASH FLOW PR0,7ECTION BEGINNING CASH BALANCE, January 2003 $ 951,970.01 RECEIPTS Appropriations, Expected - GMEF $ -0- Notes Amortization Payments - Tapper Inc. -0- Muller Theatre -0- SMM, Inc. -0- Aroplax Carp. -0-- Custom Canopy, Inc. -0- Standard Iron -0- vector Tool -0- Tapper's zz -Q- SELUEMED -0- T.J. Martin ($547.60 Mo.) 6-06 $ 3,833.20 Mainline Distrib.($702.08 Md.) 6-04 $ 8,424.96 Aroplax Corp. IZ ($730.93 Mo.) 12-04 $ 8,771.16 TCDC ($1,457.29 Mo.) 7-07 $ r•~ IRTT ($549.57 Mo.) Pre-pay $ 72,124.86 EDMA ($193.89 Mo.) 9-06 $ 2,326.68 VisiCom ($115.78 Mo.) 5-04 $ 2,778.72 UMC ($1,084.33 Mp.) 3-08 $ 10,843.30 Tapper III($524.76 Mo.) 5-08 $ 4,198.09 Interest Income - Investment (est.) $ 50,000.00 Loan Fees $ 200.00 Loan Fees Other $ 3,000.00 Miscellaneous S 1.000._00 TOTAL RECEIPTS TOTAL BEGINNING BALANCE AND RBCEIPTS EXPENDITURES GMEF Loans UMC - Reoycled UDAG/GMEF $200,000.00 Tappers - Recycled GMEF $ 55,000.00 Other $100,000.00 T.J. Martin Write-Off $ 27,$86.66 Re-payment to Liquor Fund 2003 $ 70,000.00 DMRF Grants Professional Fees $ 3,000.00 Legal Fees $ 3,000.00 Miscellaneous 1 000.00 TOTAL EXPENDITURES EXPECTED CASH BALANCE, December 2003 $ 184,..98.8.45 $1,136,958.46 $ 459,8$6.66 $ 6-'~-7-;-e-~--~8 0 ~. ~Lyg, l.~s MIN IJTES MONTICrI,LO C:CONOMIC DEVELOPML+JNT Al1THOllITY Tuesday, October 28, 2003 - 4:00 p.m. City Hall -Academy Room MEMBERS PRESENT: Chair Bill Demeules, Vice Chair Barb Schwientek, Roger Carlson, Robbie Smith, Ron Hoglund, and Darrin Lahr. MEMBERS ABSENT: Clint Herbst. STAI~'F PRI~,SEN`I": Treasurer Rick Wollsteller and f;xecutive Director Ollie Koropcllak. CiUES"I': Al Loch, Block 35 Property Owner. 1. Call to Order. Chair Demeules called the EDA meeting to order at 4:00 p.m. 2. Consideration to a . rave the Ma 27 2003 EllA minutes and ,lul 29 2003 l~;DA presentation summary. • BARB SC'HWIL'NT1iK MADE A MOTION TO APPROVE Thil-: MAY 27, 2003 EDA MINi1`I'ES. SECONDED BY DAKRIN LAHR AND WITH NO CORRECTIONS OR ADDITIONS, THIi; MINUTES WERE APPROVED AS WRI"I'TEN. WITHOUT A QUORUM A`I' Tl-1l~; ,JULY 29, 2003 EDA BLOCK 35 YRESENTAI'ION, ROCEIZ CARI~SON ACCI:'PTED 'fIJE Sl1MMARY AS WRI"l"fEN, SI-:CONDI~D BY RON HOGLi1ND. 3. Consideration of adciin or removin a 7enda items. None. 4. Consideration to hear res ~onse from Block 35 ro ert owners relative to the EDA desi Jn conce . t and financial acka e offer of Jul 29 and then determine next ste . Al Loch representing the property owners of Block 35 updated the EDA on the progress made by the property owners since the offer presented by the EDA on .luly 29, 200 3. The owners met on August 1 and September 3. On October 10, all the land owners appeared to be coming around. `I"hey agreed to scale back in order to -naintain participation at 100%. "The crick to keep 100% land owner participation while balancing an acceptable • F.DA Minutes - 10/28/03 rear facade improvement with an acceptable price. I,ocla said IDA/City nuinbcrs won't work. Trying to answer how can it work, the property owners had Tom Feaski talk about optional products to reduce maintenance and costs. Materials tolerant to water run-off is key. ,lay at Flicker's and Tlaickpenny estimated their improvements at a cost of less than. $10,000 each. Tlae owners are gathering more information from Craig Simonson, Advanced Awning Design, and plan to meet again in November. Art work is estimated at $125 per lineal foot or about $3,000. Color a~ul cloth or vinyl choices available. if feasible and everyone is on board, Jim Agosto would draft a document. "They questioned if the product will meet DAT criteria'? l logluaad said lac thought DA1' criteria does not allow for back litc awiaings but suggested the group check with Susie, ClaaYaaber Office, befiare they go to I~~r. He thought that was why Jay was asked to remove his. Mike C,yr had completed some cost estimates which came back to costly. Brad Larson has been a real support anal the added extra energy neecled for the group said Loch. Larson stating the oiler by the hI)A/(city very good and noting F3lock 35 is the most deteriorated block in downtown. Block 52 will change the design of downtown if Steve Johnson's project goes through. Loch saw this improvement as a 10-15 year band-aide fix. 1 Ic has a vision of switching the parking and buildings in the future based on the success of I-;lock 52. Loch questioned the #lcxibility of the ratio of public investment to private investment. The commissioners inquired about discussions relative to hook-ups to the catch basin or down spouts to the storm sewer? Loch asked what happens if there's a cost over-run for the utility improvements? Carlson. stated tide City would know when the Ciiy goes out Ior bids. They can accept or reject. Can work on private property be assessed such as cost for down spout to catch basin'? If the facade costs arc decreased, will the 1~:DA conamit~ateni still stand? Commissioners agreed this would be subject to N DA approval. "I'he property owners plan to be back to the EDA in January 2004. "I'hc h~UA commended Loch on his progress knowing this was not an easy task. 5, Consideration to hear proposed renovation and expansion plan for I31ock 36. Bruce Hamond requested to be on the EDA agenda and later called stating he would be out-of-town. He requested the EDA call for a special meeting on November 18 to hear of his coiacept, construction drawings, and #unding for renovation of the building on l_,ot 8, [;lock 36 and constructio~a of new building on Lot 9. 1 Ic requested matching facade dollars. Koropchak informed lama that the DMRI~• program was discontinued almost two years ago and that others have inquired about the matching lands. The EDA commissioners agreed the DMRF program remains discontinued. Since Hamond has not been tide #irst individ~ial to request matching dollars, the program must remain discontinued. Il'lae'd been lust to request maybe the commissioners would have considered rescinding their motion. 'l'hcy encouraged Mr. I larnond to move forward with his project but saw no need for a November 18 meeting. Chair Denaeules voluntccrcd to contact Mr. Hamond about the EDA's decisions. • EDA Minutes - 10/28/U3 6. Executive Director's Rc ort. Koropchak reported that no sealed bids were received at the H-Window auction. One verbal bid of $_500,000 was shouted at the end. Koropchak asked lox comments from the commissioners relative to Carol Nressley- Olson's suggestion the EDA become the Local Development Organization for the $500,000 Federal grant to the City, loan to TC'DC. The LDO would manage the use of the Federal payback and only the first re-use of the payback has to comply with federal regulations. The Council actually adopts a resolution followed by aii agreement, etc. With little reaction or no opposition from the F,DA, Koropchak will bring this forward to the Council after TCDC' satisfies its wage/job goals and LMI requirements. 7. Other Business. None. 8. ~1d~ournment. The F~.UA meeting adjourned at 5:15 p.m. by a consensus of its members present. Ollie Koropchak, Recorder