IDC Minutes 08-19-1993MINUTES
MONTICELLO INDUSTRIAL DEVELOPMENT COMMITTEE
Thursday, August 19, 1993 - 7:00 a.m.
City I3a11
MEMBERS PRESENT: Chairperson Jahn McVay, Shelley Johnson, Ron
Hoglund, Merrilyn Seefeldt, Ken Maus, Cyndie
Johnson, Tom Lindquist, Steve Lemme, Mary
Micke, Don Smith, and Harvey Kendall.
MEMBERS ABSENT: Kevin Doty, Lowell Schrupp, Arve Grimsmo, Jay
Morrell, Dennis Taylor, Dave Peterson, Linda
Mielke, and Dr. Glenn Nemec.
STAFF PRESENT: Ollie Koropchak.
STAFF ABSENT: Rick Walfsteller and Jeff O'Neill.
1. CALL TO ORDER.
Chairperson John McVay called the IDC; meeting to order at 7:05
a.m.
2. CONSIDERATION TO APPROVE THE JUNE 17 1993 IDC MINUTES.
Chairperson McVay requested the June 17 minutes, page 2, item
4, section D, be amended to read that the Standard Iron will
not combine the three facilities as written. The Alexandria
and Sauk Centre manufacturing facilities will remain as is and
the Monticello facility will house its headquarters and
additional manufacturing space.
Ron Hoglund made a motion to approve the June 17, 1993 IDC
min~ztes with the requested amendment. Merrilyn Seefeldt
seconded the motion and without further corrections or
additions, the minutes were approved as amended.
3. CONSIDERATION TO HEAR___AND ACCEPT THE IDC FINANCIAL REPORT.
Treasurer Hoglund reported beginning monthly balances at
Metropolitan Federal of $1,247.34 and at Marquette of
$4,174.66. After payment of monthly bills, the combined net
balance is $5,334.24. The August IDC financial report was
accepted by a consensus of the IDC membership.
4. CONSIDERATION OF PROSPECT UPDATES:
a) Standard Iron & Wire Works, Inc. - Koropchak reported
that the HRA has authorized BDS, Inc. to establish TIF
District No. 1-13 for land write-down and site
improvement pay-as-you-ga assistance. A Letter of
Intent, company check, and copy of the purchase agreement
for Lots 7 and 8, Block 2, OIP, riave been received from
IDC MINiJTES
AUGtJST 19, 1993
the company. Standard Tron's New Hope office was visited
in late Jane by Jahn McVay, Ron Hoglund, Jeff O'Neill,
and Kevin Doty. All agreed this quality company is
compatible with the City's economic development
standards. The company is a fabricator of metal. The
three million dollar plus project will consist of an
approximate 50,000 sq ft manufacturing/office structure
with an employment of 115. Real estate and equipment
will be financed through the bank, SBA, TIF, equity,
State, CMIF, and the GMEF. A fall construction is
anticipated. This lead came from Jerry Schoen, Aroplax
Corporation.
b) Custom molder of industrial and medical products - This
company located in Annandale is looking at the Monticello
area because of freeway accessibility, and labor force
and land availability (land served with adequate
utilities). Construction plans are far a 16,800 sq ft
metal office/manufacturing facility with an employment of
20 within two years. The company has been in business
for 10 years and produces flexible foam products which
are attached to metal equipment. Since our policy is not
to encourage business relocation within Wright County or
the immediate surrounding area, the $400,000 plus real
estate would be financed through TIF, bank, and SBA.
BDS, the company, and Koropchak met on August 18. The
Prospect Committee will be called to visit the Annandale
location soon. This lead came through the Chamber
office.
c) Steinwall, Inc. - Koropchak was contacted by Northco, a
builder, who at the request of his client was looking for
available sites to construct a 40-50,000 sq ft
office/manufacturing facility. The client turned out to
be Steinwall, Inc. Koropchak having reached Mr.
Brotherton, stated the company plans to move in December
of 1994. Steinwall appears to be most interested iri
sites in the Louring Hillside Addition by FSI.
d) Wilson Tool International, Inc. - Koropchak reported she
has made contact with Wilson's newly hired plant manager.
Mr. Tom Snuggerud said the company has re-focused their
priorities: First, assessment of engineering process,
and secondly, building/site selection. The 1994 plan is
far a 8-10 month building/site selection process for the
proposed 30-40,000 sq ft facility. This company designs
and builds replacement tooling for the steel metal
fabricators. The largest turret tool manufacturer in the
world has a product line that includes standard and
special punches and dies for various press manufacturers.
Monticello remains on the site selection list.
• Page 2
IDC MINUTES
. AUGUST 19, 1993
e) Weinhold Company - This small company manufactures quick
change (insty-bit) bits for power drills. The growing
company employs 6 full-time peaple and is looking for
lease/purchase option on a 5,000 sq ft facility. Mr.
Weinhold is attending a National Hardware Trade Show tr~is
week and requested Koropchak to call in a couple of
weeks. This lead from Bill Tapper.
f) Medical Transcription - MK and Company, a California
business, is looking to relocate its business to the
Minnesota. They employ 14 people. Through the use of
high technology and tele-communications the company
markets to hospitals, clinics, etc. The lead came
through the Chamber office in June and Monticello
marketing information was mailed. Mrs. Miroslav (Pam)
Konvicka moved from Monticello at the age of two, family
name was Spenner. They plan to visit Minnesota in
August.
g) Right-Choice Services - The company has extended its
current lease in Maple Urove for another three years . In
three years, the company will look to build a 30,000 sq
ft building with an employment of 45. The company
similiar to FSI, is a coupon/redemption marketing
facilitator. Andy Robinson lives locally and the lead
• came from Jim Fleming.
tl
h) y
Fluidyne, Inc. - This technical service firm recen
sold the aero-space system division to a St . Paul company
and the energy-related system division is looking for 7-
8,000 sq ft of leaseable space. Current employment is 7-
8 people and the company expects to double the employment
in two to three years. The company employs professional
people with an annual average wage of $40,000. The
office/laboratory requires a professional image as 509 of
their service is exported to Japan. The company is
looking for the right bank and working capital. This
lead came from Brad and Mary Barger via Robert Schanlon.
Koropchak is to call back after Labor Day and speak to
Len Frame, President.
i) Knights Color & Chemicals - This Montrose/Waverly company
manufactures dye-ink. Currently, the company operates
from two locations and is looking for about two acres to
construct a metal facility in 1994. The average wage
range is $8.00 to $10.00 for its 20 employees. Building
size has not been determined.
j) Irresistible Ink - This start-up service business would
employ a part-time staff of tele-marketers ($10 wph) and
clerical ($4.50 wph). The company inquired about the
availability of an existing 3,500 sq ft building with a
lease/purchase option and available financing options.
• Page 3
IDC MINiJTES
AUGUST 19, 1993
John Petters is scheduled to meet with Ken Holker and is
arranging a meeting with Dr. Brion. The company would
like to be operational this fall or January. Mr. Petters
started a successful business in St. Cloud whictz he
recently sold. The lead came from Bab Rierson.
k) Precision Opticals -This family-operated Silver Creek
business who markets to industrial businesses is looking
for a 8-10,000 sq ft building. The company anticipates
an employment of 10 part-time people within two years.
Owner is Richard Vizenor (Visner).
BRE UPDATES:
a) H-Window - Koropchak outlined in detail the financial
packaging process proposed for the H-Window expansion.
On May 25, 1993 Pat Pelstring, Lenny Kirscht, and
Koropchak met with representatives of the Norwegian Board
and Steven Lemme. Fallowing this meeting, BDS, Inc.
suggested de-certification of the existing TIF District
and establishment of a new district to collect the eight
years of tax increment generated by the expansion. City
staff questioned BDS on the legality of de-certifying an
existing district.
The original $2,075,000 financial proposal was reviewed
. by the EDA on June 7. This proposal included equity,
State funds, TIF, and the issuance of $1,175,000 of G.O.
TIF Bonds by the EDA. However, the EDA elected not to
issue the bonds because in their opinion the projected
bond rate of ?.69o was comparative to commercial lending
and not a sufficient savings to the H-Window.
On June 14, prior to Mr. Lemme's departure for Norway,
the revised financial package of equity, commercial
lending, TIF, and State funds was reviewed with Mr.
Lemme. Of the projected annual $35,000 tax increment,
$20,000 was for the company's annual debt service with
excess TIF for land write-down of the City's lots. The
legality of de-certification was still not resolved. In
conversations with BDS from Koropchak's home, inquiries
were made to the legality of de-certification and
progress of the H-Window proposal.
At the August 11 HRA meeting, the HRA approved splitting
and de-certifying the TIF District No. 1-7 boundary for
creation of TIF District No. 1-16 subject to compliance
with the Minnesota Statutory. On August 12, BDS
determined the de-certification of the district bo~zndary
was not legal. Yesterday, Mr. Kirscht and Koropchak met
with Mr. Lemme regarding the new TIF information and the
Page 4
IDC MINUTES
• AUGLiST 19 , 1993
HRA has scheduled a special meeting this evening to
approve the use of TIF surplus funds for $160,000 of site
improvement assistance over eight years. The HRA will
evaluate BDS' performance as to the length of time (from
May 25 to August 12) to resolve the legality issue as
questioned by city staff; therebye, causing HRA
embarrassment and H-Window undue disappointment and
frustration.
Although, the H-Window Company remains committed to
Monticello, the Norwegian parent company is apprehensive
of their approved 2-million expansion which has
temporarily been put on-hold, reported Mr. Lemme.
Additionally, Mr. Lemme suggested if the current H-Window
facility met the needs of Standard Iron, a potential sale
of their facility would allow the H-Window to purchase a
new 20-acre site adequate for their long-term planning.
The IDC fully endorsed the H-Window expansion and
recommended the HRA consider the project as number one
priority. Additionally, the IDC suggested tYie HRA
consider purchase of the existing H-Window facility and
lease it back to the H-Window or another company, and
• suggested an IDC Subcommitte meet with the HRA to
evaluate the performance and billings of BDS, Inc.
b) Sunny Fresh Foods - With the dollars invested in
renovation of the old-creamy and the potential expansion
of Sunny Fresh, Don Smith suggested the City move quickly
and explore the legality of the 5th Street right-of-way.
Sunny Fresh plans call for utilization of the right-of-
way far parking. Mayor Maus reported the project is back
in Sunny Fresh's court as to the overall site plan.
Contact person at Sunny Fresh is Mr. Roberts.
c) Aroplax Corporation - Koropchak noted the "thank you"
note the IDC received and reported the open house was
attended by past and present company employees and their
families, suppliers, and Schoen family members from
California and Arizona.
d) Custom Canopy - In a conversation with Steve Birkeland,
the construction progress was delayed by rain, the
company is currently moving into the shop area and
anticipate the office area to be completed the end of
this month. Business is going-well.
Page 5
IDC MINUTES
AUGUST 19, 1993
5. CONSIDERATION OF PROJECT UPDATES:
a} IDC Banquet - Banquet plans are well on-the-way with
tickets to be distributed at the next IDC meeting.
Potential testimonial speakers noted were Knut Flakk of
the H-Window, Bondhus Corporation, or Genereux Fine Wood
Products. The banquet is scheduled for Tuesday, October
26, guest speaker is Dr. James Bensen.
b) Central Minnesota Initiative Fund Report - Tabled as
Kevin Doty was absent.
c) Wright County Economic Development Partnership - Their
next meeting is scheduled for August 25, 10:30 a.m. at
the Hanover City Hall. Koropchak presented copies of the
Articles of Incorporation, By-Laws, and Establishment of
Task Force for ratification.
d) Quad County Development Network - Next meeting scheduled
for September 17, 10:30 a.m. at the St. Cloud Chamber of
Commerce Center.
e) Industrial Business Directory - Koropchak will notify the
IDC Subcommittee to begin plans for development of a
local industrial business directory.
f} Letter from Jim Fleming - Enclosed with the IDC agenda
was a letter from Mr. Fleming with notification of his
acceptance to the Leadership TwinWest. Mr. Fleming is
• interested in IDC membership and currently serves on the
Police Commission.
g) Metro phones - Koropchak reported the second-round of
phone traffic and rate studies have been completed by the
metro and Monticello telephone companies. The Public
utility Commission will start its reviewal process.
6. OTHER BUSINESS.
a) Chamber Business After Hours, Today, 4:30 to 6:30 p.m. at
the Monte Club.
b) Dungannon/Monticello Rotary Exchange - Don Smith briefed
the IDC members as to the brainstorming plans of this
first exchange scheduled for October 1994 The exchange
would include the areas of arts/cultural, education,
religion, government, and economic development with
potential of industrial importing and exporting. Mayor
Maus, Jeff O'Neill, and Koropchak will be providing
information or local and state marketing materials.
c) Jahn McVay informed IDC members that during the month of
September approximately GO-70 fuel tanker trucks per-day
would pass through Monticello enroute to the NSP Sherco
Plant. The trucks would be enroute from a coke refinery
facility south of the metro. Members recommended the
trucks utilize Highway 25 and not East Broadway.
Page 6
IDC MINiJTES
. AUGUST 19, 1993
7. ADJOURNMENT.
Mary Micke made a motion to adjourn the IDC meeting, seconded
by Harvey Kendall. The meeting adjourned at 8:50 a.m.
e~ K~ ~~~
Ollie Koropchak, IDC Executive Director
•
• Page 7