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IDC Agenda 05-16-1996AGENDA MONTICELLO INDUSTRIAL DEVELOPMENT COMMITTEE Thursday, May 16, 1996 - 7:00 a.m. City Hall • MEMBERS: Chairperson Bill Tapper, Vice Chairperson Tom Lindquist, Treasurer Ron Hoglund, Arve Grimsmo, Shelley Johnson, Jay Morrell, Don Smith, Ken Maus, Kevin Doty, Merrlyn Seefeldt, Tom Perrault, Jim Fleming, Dick Van Allen, Tom Ollig, and Bill Endres. CITY STAFF: Rick Wolfsteller, Jeff O'Neill, and Ollie Koropchak. 1. CALL TO ORDER. 2. CONSIDERATION TO APPROVE THE APRIL 18, 1996 IDC MINUTES. 3. CONSIDERATION TO HEAR AND ACCEPT THE IDC MONTHLY FINANCIAL REPORT. 4. CONSIDERATION TO DISCUSS FOR APPROVAL THE RECOMMENDATION OF THE SUBCOMMITTEE FOR IDC RESTRUCTURING: PURPOSE, FUNDING, DISBURSEMENT OF CURRENT FUNDS, ACTIVITIES, AND ORGANIZATION (OPTION 1 OR OPTION 2.) 5. CONSIDERATION OF PROSPECT LIST. 6. OTHER BUSINESS. 7. ADJOURNMENT. • MONTICELLO INDUSTRIAL DEVELOPMENT COMMITTEE • Minutes of April 18, 1996 Members Present: Chairperson Bill Tapper, Vice Chairperson Tom Lindquist, Treasurer Ron Hoglund, Arve Grimsmo, Don Smith, Ken Maus, Merrlyn Seefeldt, Tom Perrault, Ollie Koropchak Meeting was called to order by Chairperson Bill Tapper. The March 21st minutes were approved by motion and second. Monthly fmancial report was given by Ron Hoglund, FiPS~' Bank g 4,©pfS.a.t! _~I`-~,3a3-73 - ~Iarc~v~e~Q ~~~ 1i~,3 ~~: ~~ Discussion for the balance of the meeting centered around the question "Is there a need for an IDC?" The following are comments from that discussion. Options: a. IDC Continue on it's own? b. IDC join with the Chamber? c. IDC join with a government or city organization like EDA or HRA? d. IDC where does it go from here? What is our organizations background -purpose, what is our mission? Should the IDC reorganize, help the council, what help can we be to industry, we have no authority to do anything. Basically we are out of land. To fmance more land we would need to fmd persons willing to fund land purchases, very unlikely. Don't really see a need for an IDC committee as it is structured today. The question still is where does the IDC go from here? We may need to reevaluate our situation and figure out where to go from here. Maybe we need to make a formal request to the City Council and have them get into the land business. Suggest putting our efforts more to helping the City Council. Should look at restructuring the IDC maybe just 5 or 6 members not 15 or make more subcommittees and have quarterly meetings. Some kind of proposal needs to be put together. How do we maintain our financial status without Chamber help? All agreed to keep our May 16th meeting date. • Motioned to adjourn, seconded and unanimously carried. Respectfully submitted: Sam Hutchinson (TDS TELECOM) __ • May 8, 1996 I.D.C. Members ref.: Adhock committee on I.D.C. restructuring Today Ken M., Tom L. and Bill T. met to formulate a restructuring recommendation for the I.D.C. as requested by the general membership. The three of us agreed on a recommended direction with two alternatives to the organization size and structure. Background: The roll of the IDC is changing with the maturation of the City, industrial lamed inventory dwindling, and the community attention focused on our decaying downtown. In recognition of these changes the adhock committee feels that the IDC is going to go through a period of 3 to 8 years where the primary purpose will be to keep the benefits of industrial development in front of our civic leaders. With this in mind, the committee proposes the following. Committee Recommendation: • Purpose of IDC: To lobby on behalf of industrial development in the city of Monticello. To advise and assist the IDC director and/or the city council on matters of industrial development and retention. Funding: The IDC shall have no funds or fund-raising activities. Disbursement of current IDC funds: The IDC s~iall pay up all existing obligations and donate the balance to the City or to the Chamber of Commerce. If donated to the City it would be used to settle our obligation to support the Directors salary. If donated to the Chamber, it would be with the understanding that they would continue to fund the gratis spring breakfast for industries. Activities The IDC would continue to host the spring breakfast for the Chamber. • The annual fund-raiser would be dropped and the Chamber encouraged to have a similar activity in the fall. Organization: Option 1 Organization size cut to S to 10 members divided into two groups. Group one would focus on prospecting • and business retention and group 2 would focus on lobbying. Full group meetings to be held bi-monthly and small group meetings held as determined by the groups. Organization Option 2 Organization size cut to 5 to 6 members with the primary objective of lobbying and making themselves available to the Director on an as needed bases for prospecting trips. Full group meetings would be held monthly. May 16 will be the next IDC meeting. It is very important that all members attend since the only item to be discussed is the above recommendation. I expect to call for motion on this matter and to bring it to a final vote. Sincerely, William R.Tapper • • M E M O R A N D U M DATE: May 10, 1996 TO: Ken Maus Tom Lindquist Bill Tapper FROM: Bill Endres RE: IDC restructuring CC: /Ollie Koropchak, Cyndie Johnson As President of the Monticello Chamber of Commerce, I wish to restate that the chamber is an advocate of the IDC. If the committee decides to ask for chamber cooperation in funding an industries breakfast, the change will be supported by me and recommended to the chamber board of directors. I have already planned an "industry week" as a chamber promotion to coincide with the national "week" later this year. May I also suggest that the IDC banquet be continued not • as a fund raising event but as a vehicle to promote industry recognition in Monticello. See you at the meeting on Thursday morning (16th). ~~' • Jerry's Towing, Monticello 295-3729, land for sale. Mechanical shop and garage, 5 stalls, fenced area, freeway or Hwy 25 exposure. Gene Williams, Vision Machine, 241-1866, Elk River. Machine shop operation, aluminum milling, customers IBM, Polaris. Six months. 3,000 sq ft. Currently 2 ft, project 4-6~ starting wage $7-8, in-house training. Lease or consider purchase. Eric Bondhus, Lake Tool, 295-6655, looking to relocate and expand. City lot prices and regulations. Paul Allen, Wiha Tools, 295-21.62. Purchased City Lots 5 & 6, OIP Second Addition. 10,000 sq ft warehouse/distribution center for small hand tools manufactured in Germany. (used on computer and medical equipment.) Occupancy necessary September 1. Retain 3 and create 7 new jobs. W. C. Branham, Inc., 12,000 sq ft, 2-3 acres, light manufacturing, currently in Osseo. Lease expires in July. Tim Miller - on behalf of Talon Engineering, Inc., 10,000-14,OOOsq ft. Highly specilized machinist. 12 current employment, anticipate hiring 1-5 people every two months. Beauty supply dealer -Nancy Philbrook, 295-2013, 2 jobs. i Sandra Johnson, 755-7493, retail service business. Heat treating plant - 50,000-80,OOOsq ft, 5 acres. Current 21 employment, immediate add- on 7-8, within three years expect to add an additional 30. Servicemaster - 2,400 sq ft pole barn structure. Carpet and Upholstery Cleaner - 8,000-10,000sq ft warehouse/office. Currently 8-10 FT project 7-10 additional upon relocation. Midwest Lumber, Inc. - 8-12 areas, 15,750 sq ft metal building, outdoor storage, wholesale/distribution center. Sun Patio, Inc. - 12 acres; Phase I 48,000 sq ft, 30 employment; Phase II 20,000 sq ft and Phase III 48,000 sq ft, total 100 employment. Rotational. molding company -Iowa and Minneapolis currently, 6 acres, immediate 20,000 sq ft with 15-20 jobs, expansion up to 60,000 sq ft. Prefers steel building. Wholesale warehouse distribution center of homeowner garden supplies - 3-5 acres, 30,000 sq ft metal building, 6 FT and 6 seasonal. • FINAL BILL . Riverwood 10990 95th Monticello (612) FAX (612) conference Center Street NE MN 55362 441-6833 441-3186 Contract Number: 14859 Client Number: 20744 Invoice: 14859-F Date: 04/17/96 To: CITY OF MONTICELLO PO BOX 1147 MONTICELLO MN 55362 295-2711 Attention: OLLIE KOROPCHAK _______________________ CONFERENCE DESCRIPTION ----------------------- Title: IDC Breakfast Begining Date: 04/16/96 Ending Date: 04/16/96 Number of Participants: 32 Arrival Time: 7:30 AM Departure Time: 9:30 AM ------------------------------ BILLING ------------------------------- Conference Costs $ 222.40 (See attached pages for details) Sales Tax $ 14.46 Service Charge $ 35.58 Total Conference Costs $ 272.44 TOTAL AMOUNT DUE $ 272.44 TOTAL AMOUNT PAID $ ------------------------ TERMS AND CONDITIONS ------------------------ 1. Payment Due Date Full payment is due on or before 05/01/96. 2. Past Due Accounts Past due accounts are subject to a 1.5$ monthly finance charge. r~ Riverwood Conference Center • COMPANY: CITY OF MONTICELLO Contract: 14859 Date: 04/17/96 Page 2 Count Unit 04/16/96 F247 BREAKFAST TOTAL 32 PERSON TOTAL Calculation of Sales Tax Total Taxable Items 222.40 Minnesota Sales Tax (6.5~) 14.46 Service Charge GRAND TOTAL NET AMOUNT DUE 222.40 222.40 14.46 35.58 272.44 $ 272.44 • ©t1,~c~ r~ ~J • CITY OF MONTICELLO MONTHLY BUILDING DEPARTMENT REPORT Month of April 1996 ~Gt1^~ITC D. I ICCC PERMITS ISSUED This Month A ril Same Month Last Year Last Year To Date This Year To Date RESIDENTIAL Number 18 25 54 71 Valuation 1 163 600.00 560 400.00 1 879 700.00 3 568 665.00 Fees 11 799.11 7 704.47 20 985.45 36 189.38 Surcharges 587.45 277.2G 936.07 1793.93 COMMERCIAL Number 1 5 12 8 Valuation 200 000.00 776 200.00 879 200.00 785 000.00 Fees $1 632.67 6 075.02 $7 286.02 6 594.35 Surcharges $100.00 $388.10 438.85 392.75 INDUSTRIAL Number 0 0 1 1 Valuation 575 000.00 21 000.00 Fees 3 736.43 216.00 Surcharges 287.50 10.50 PLUMBING Number 14 9 27 47 Fees 986.00 494.00 1 337.00 2 458.00 Surcharges 7.00 4.50 13.50 23.50 MECHANICAL Number 15 9 26 46 Fees 612.00 402.00 1083.00 1860.00 Surchage $7.50 $4.50 13.00 23.00 Other OTHERS Number 1 0 2 2 Valuation Fees 10.00 110.00 Surchar es 0.50 0.50 TOTAL # PERMITS 49 48 122 175 TOTAL VALUATION 1 363 600.00 1 336 600.00 3 333 900.00 4 375 255.00 TOTAL FEES 15 039.78 14 675.49 34 627.90 46 697.39 TOTAL SURCHARGES $702.45 $674.30 $1 688.92 2 244.18 nl Inn~u~ un/.lru FEES NUMBER T O DATE PERMIT NATURE Numbe Permi Surchar Valuatio This Yea Last Yea Single Family 12 10 833.41 552.75 1 105 100.00 29 20 Duplex/Twin Homes 4 0 Triplex 1 0 Multi-Family 2 Commercial 1 $1 632.67 $100.00 200 000.00 3 1 Industrial 0 Res Garages 0 . Signs 0 Public Bldgs. ALTERATION/REPAIR Dwellings 6 965.70 34.70 58 500.00 37 29 Commercial 4 10 Industrial 1 0 PLUMBING All Types 14 986.00 7.00 47 27 MECHANICAL All Types 15 612.00 7.50 46 26 ACCESSORY STRUCTURES Swimming Pools 0 Decks 5 MOVING PERMIT 1 2 TEMPORARY PERMIT 0 DEMOLITION 1 10.00 0.50 2 0 TOTALS 49 15 039.78 702.45 1 363 600.00 175 122 APRIL96.WK ~ -~ COUNCIL UPDATE May 7, 1996 Implementation of trunk storm sewer fee. (J.O.) Following is some information on the manner in which City staff is proceeding on implementation of the trunk storm sewer fee as it applies to various properties at various stages in development. As with any new policy, questions arise as implementation begins. Following are strategies that City staff is employing in administering the program in response to questions regarding implementation. Please review these strategies and provide staff feedback if you feel the strategies are not consistent with what Council would view as proper policy. STORM SEWER FEE COST PER ACRE I was not in attendance when the storm sewer fee program was adopted, but I understand that the program was well accepted and there was not a lot of discussion on the topic. Council may not have been completely aware that the cost per acre for storm sewer trunk fees is in the neighborhood of $5,000 per acre. For a company like Tappers, Inc. with over 6 acres of land, the trunk storm sewer fee amounts to $33,000. Staff remains comfortable with the fee amount due to the fact • that the fee structure accurately reflects the actual cost per acre to provide trunk storm sewer service; however, we also want to make sure that we are creative and flexible when employing the storm water fee so that we do not unduly impact projects already underway or impact projects with financing programs already in place. Our goal is to create the best of both worlds where we are able to acquire the necessary storm water trunk fees without creating financial hardships for commercial and industrial developments now in the pipeline. In light of this goal, we have tentatively established the following guidelines for implementation of the trunk storm sewer policy. Please note that this is an interim policy, and that the original intent of the policy remains, which is to require that the trunk storm sewer fees be paid upfront with the building permit. We feel that some flexibility needs to be brought into the system to soften the impact of the new fee. Following are three general categories of businesses at different stages of development. 1. Businesses with a finance and site plans in early stages of development. Businesses in this category would include those that are in the early stages of project development. This would include Mike's Custom Paints and any other business expansion or new business that comes through the door. For • STORMSEW.UPD: 5/7/96 Page 1 businesses in this category, the City will be providing a notice of the trunk storm sewer fee program to enable the business to incorporate this fee into their financing plans. These businesses will pay when they pick up a building permit. 2. Businesses that have been planning for expansion or startup for some time where expenses and revenues are 8xed~ and the ability exists to expand at the present location. Businesses in this situation would include Tappers, Inc. and WIHA. These are business expansion projects limited by a fixed finance plan that may not be able to absorb a large trunk storm sewer fee. To buffer the impact of this fee, City staff is offering a deferral of the fee fora 3-year period or until a building expansion occurs, whichever is sooner. The fee will be paid on annual equal payments for a period of 5 years. The fee can be adjusted upward if the trunk storm sewer fee is increased. Under this option, industrial sites and commercial sites that are now in the pipeline will be able to absorb the added cost of the new fee. 3. Businesses with a sit. elan and finance nl_an comnlete~ egnenses and revenues are fixed' there is no ability to expand on the site. Businesses in this category include those that are in the pipeline that do not have an opportunity or have limited opportunity to expand which limits our ability to collect the fee in exchange for a building permit at some point in the future. This group would include Value Plus Homes and the Pipeline Supply Company, Mielke Oil, and others. For businesses in this category, in exchange for an occupancy permit, we would require payment of the trunk storm sewer fee in equal installments over a 5-year period and an agreement to allow the City to assess the cost against the property if the fee is not paid, with the builder allowing the fee to be levied as requested as an assessment if not paid. As an alternative, the fee could be spread against adjacent undeveloped areas to be paid at such time that future development occurs. This situation applies to the Kant-Sing project. If Council has significant questions or problems with the general guidelines that staff is following today, please let us know, and we will place this item on the formal Council agenda at an upcoming meeting. CJ STORMSEW.UPD: 5/7/96 Page 2 • IS THERE A NEED FOR AN IDC`? April 18, 1996 Additional Comments Motivation -Tax base and jobs. Perhaps restructure IDC to 5 or 6 members. 1. Long-range Subcommittee 2. Prospect Team. 3. BRE Subcommittee Perhaps Chamber -Groundbreaking City -Breakfast Prospect Team -Chamber No IDC Budget (retire City debt, donate funds to Chamber) Chamber -Breakfast and Banquet Need pro-active IDC IDC meet every other month with option of breakdown session • A need for industry Quarterly I:DC with subcommittees BRE Subcommittee to Chamber Need to re-organize: Industry and help council No financial stake, no motivation IS THERE A NEED FOR AN IDC? Discussion of April 10, 1996 (Tapper, Lindquist, Doty, Maus, and Koropchak) * Local ownership of Oakwood Industrial Park -land developed, mission accomplished. * Less control with private ownership of industrial land. (TIF restriction on Green Acres Tax Classification) * What does the community want to be when it grows up? Bedroom community Commercial/recreational community * Close proximity of Rogers to the metro and 1 U 1 ring. Development of industrial parks in Albertville and Ostego. * Where does the IDC fit'? Self-standing, branch of the EDA (government), or branch of the Chamber. Evaluate the pros and cons of each. * IDC no longer active role in production of marketing materials, videos, advertising, etc. * What is the focus of the City`? • * IDC lacks focus - no clear direction. * Prospect Team not as active. Commitment of Councilmembers fvr industrial development, housing, or * retail/commercial. * Commitment of IDC members for programs relating to the retention of existing business. * IDC members lobby Councilmembers to buy into the conc~ t motvat onpment of a public industrial park for future use. Creates ownership, pnde, * Cost prohibitive for private development of an industrial park. * IDC members lobby Councilmembers for general industrial development interest. * IDC advisory board of the EDA, no need for budget or banquet. * Change in Council attitude toward the use of TIF to assist industrial businesses because of HACA Penalty. * Council define quality business. osts and ordinance regulations more restrictivof industrial bus~ness`d~ *~e development c etrt1Ve in the recruitment prevent Monticello from remaining comp 1 benefits to the industries for the IDC-sponsored I3RL Breakfast's * Are there rea s should lend support to the efforts of the Monticello Community * Perhaps IDC member Partners. urces (financial and volunteers) to support the various organizations o * Not enough reso a community the size of Monticello. * Loss of communication between the IDC and City Staff. * Loss of communication between the City (IDC) and NSP. a ressive and competitive for industrial development than in the * Neighbor cities more gg past. the Economic Development Director. Less time for industrial contact * Changing role of follow-up and contact of existing industnes. Role of the Monticello Area Chamber of Commerce. •