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EDA Agenda 05-21-2008A W d 9 m N cC c° U H Y M ^ > o a O � a� 7:3 cd �3 d b �3 o U m � o O � �0 o U U R3 •° x � w �+ U C q U x S � c c � N 100 o � ct r� O U U N cd cd 0 0 0 U o o 9 � U o N � O N � UaU oUC7 d W U U � o U a w A b 00 N O cd o W d ° U o � bA" 9 m U c° U Y ^ > o a O � a� 7:3 �3 o U m � o O � � o U U R3 •° o U �+ U x S � c c � N � � ct r� O rn rn cd 45 cd cd 0 0 0 W o o 9 .., o o UaU oUC7 d W U U 00 Lotc �d bA" •� � o � o 0n � o � i �j 4r on on Cd0 O oU °U " CtU s0 0 9 m 99 U c° U Y > o a O � �3 cu U m � o O � � o o U rA S ti O c � N � � cz r� O 45 cd cd 0 0 0 0 0 o o 9 o o UaU oUC7 d W U 99 WORKSHOP MINUTES CITY OF MONTICELLO ECONOMIC DEVELOPMENT AUTHORITY Wednesday, April 9th, 2008 1. Call to Order. Chairman Demeules called the meeting to order and noted. a quorum of the Authority present. 2. Roll Call. Commissioners Dan Frie, Bill Tapper, Bill Fair, Bob Viering and Wayne Mayer present upon roll call: Commissioners Herbst absent. 3. Add On Item -GMEF Loan No. 021 Status Update Koropchak reported that one of the GMEF loans would be coming due on May 1St. She had received a request to extend the balloon payment for that loan. This request has to be extended by a majority of the Commissioners and requires lender support to be provided by applicant. Koropchak explained that there could be a potential conflict of interest with a Commissioner, as that Commissioner is involved with the project for which the loan was issued. She noted that this conflict arose partially due to the merger of the EDA and HRA. She explained that with the HRA, a declaration can be signed and the Commissioner could exclude themselves from the discussion. However, the EDA does not have that provision and the Commissioner would need to resign for the item to be considered. She noted that another City has brought forward to the legislature the idea of the HRA provision also applying to the EDA to the legislature for consideration. The question becomes will that legislation be passed and signed by Governor by May 1St, which is when the balloon payment is due. Koropchak discussed options available to the EDA regarding this issue, which included delaying action to the May meeting in relationship to the possible legislative change, or calling for a special meeting on 30th of April. Koropchak stated that she had talked with the EDA attorney. She stated that in this situation, he lead her to believe it was acceptable to delay the action, because the decision of the legislature was relatively soon. MOTION BY COMMISSIONER VIERING TO DELAY ACTION ON GMEF LOAN No. 021 AS RELATED TO BALLOON PAYMENT. MOTION SECONDED BY FRIE. MOTION CARRIED, 4 - 0 - 1, WITH COMMISSIONER TAPPER ABSTAINING. 4. New Business. a. Consideration to review and complete revisions to the City of Monticello EDA Business Subsidy Criteria. Koropchak stated that the revised criteria include should be representative of all of the changes that were made to the document at the previous meeting. Tapper stated that he had understood that under clause 5.03C that the decision was to delete all references to the current federal minimum wage law and just index to the law. Fair confirmed that statement indicating that the clause was to reference formulas only, not dates or amounts. Viering stated that the wages could be provided as an attachment to this document. Fair noted that the language needs to be clear that the wages are at the time the application is made, or when agreement is entered into. Demeules noted that for as long as the TIF is in place, those wages need to be adhered to. These clauses should be consistent. Demeules inquired if annual reports are required by TIF, as well as GMEF. Koropchak confirmed that is required for both and is noted in the documentation. Koropchak referred to the language stating that the applicant will execute and submit the non-refundable fee per approved fee schedule. She stated that whatever the Authority decides in terms of fees and deposits, the language should be consistent. Frie stated that if the funds aren't used, it should be returned. Tapper agreed that in that case, it should be called a deposit. Finance Director Tom Kelly recommended that the statement should simply read "deposit per approved fee schedule". The Commissioners reviewed the guidelines for GMEF. Tapper referenced the confusion caused by including both the GMEF and TIF regulations, guidelines and criteria as one document. He suggested that it may serve better as two documents. Fair asked what the criteria is for waiving loan fees. Demeules stated that in the past EDA has always only required the minimum. Fair asked why not just make it $200 in that case. Koropchak stated that there maybe some unusual circumstances where the EDA would like to charge more. This fee is just an administrative item. Fair recommended leaving it as it is. Fair asked if Demeules thought there was anything glaring that should be changed. Demeules stated that the EDA had gone through it each year. He noted that some of the items cannot be changed as they are federally mandated. Viering noted that the language in these guidelines referring to interest rate should also read "as published in the Wall Street Journal." Fair asked if it is clear when the prime rate is implemented. Koropchak confirmed it would be on the date the EDA approves the loan. Koropchak stated that when the changes to the documents are done, she will send them to the attorney for review, as they had drafted the originals. Koropchak noted that when a loan is approved by the EDA, it is sent to the Council. The Council criteria is written such that they ratify the loan as approved by the EDA unless they find that EDA hasn't followed the guidelines. The guidelines require ratification within 21 days. Mayer noted that there is only one time each year that the Council wouldn't hold meetings within 21 days, which is at the end of year. Koropchak explained that the original revolving loan fund was established by a letter of credit of $200,000 from the City liquor store fund. In 2007, the EDA had made a motion that the last remaining $100,000 replayment from the liquor store loan be applied toward debt service for 2008. As of now, there isn't any debt for this program. Fair noted that as there is no longer a revolving loan from the City, that clause may not need to remain in there. Viering agreed. Tapper asked what the implication is of leaving it in. He questioned whether there could be a scenario where it would be needed again. Fair stated it was a one- time fund. Mayer commented that if the issue comes up again, the EDA could just address it again. Koropchak stated that the revolving loan fund and business subsidy guidelines have to go to the Council prior to any amendment. Fair asked who receives the quarterly and annual report. Koropchak stated that the EDA reviews the documents and then they go on to the City Council. b. Consideration to review and authorize Kennedy & Graven to review proposed amendments to the Preliminary Development Agreements. Koropchak stated that there are two preliminary development agreements used by the EDA; both apply to TIF. They were developed by Kennedy & Graven. The first is used for redevelopment, housing and economic districts. The other is used for the City's industrial park. It was noted by the commissioners that some of the pages were missing from the documents. Koropchak stated the item could be tabled in that case. Fair asked if the item could be placed on the next regular agenda. Koropchak confirmed. Koropchak stated that the main item of concern related to the costs referred to in the document in terms of fees and deposits. Fair stated that the EDA needs to make sure developer understands that they are paying a deposit. Frie asked if Kennedy & Graven use these in other communities. Koropchak stated that it may depend on the project. MOTION BY COMMISSIONER FAIR TO TABLE ACTION ON PROPOSED AMENDMENTS TO THE PRELIMINARY DEVELOPMENT AGREEMENTS, PENDING REVIEW OF FULL DOCUMENTS, TO THE REGULAR MAY MEETING OF THE EDA. MOTION SECONDED BY VIERING. Frie stated that he doesn't see that the EDA should make a lot of changes to what the attorney has drafted other than the deposit language. MOTION CARRIED, 6-0. c. Consideration to establish EDA objectives, strategies, and tasks (Action Plan) supporting the Economic Development Chapter of the Comp Plan. Koropchak referenced language from the draft comprehensive plan, which cites attracting jobs and expanding tax base as the primary goals for economic development in Monticello. She noted that the comprehensive plan has not yet been adopted. She indicated that the comp plan calls for the comprehensive plan and its strategies to be updated annually. The Economic Development chapter identifies land use as "Places to Work'. Koropchak explained that she took four developed strategies from the comprehensive plan for the EDA to review. Koropchak explained that the EDA, and the comprehensive plan, have not yet addressed new goals and objectives for the downtown. Koropchak stated that the plan identifies Monticello as a regional commerce center. Tapper noted that Monticello's advantage is being an independent City, with residential, commercial and industrial components present. Tapper also commented on Monticello's natural opportunities, which are missed by not capitalizing on the river. Fair noted that existing development prohibits that capitalization. Tapper referenced that a function of the EDA is the downtown development and perhaps an objective should be to actively buy up land adjacent to the river and convert it to other uses. Fair stated that he understands that objective, but practical experience has been that those on the river don't want public access. Tapper stated that the 1997 plan for downtown is unrealistic. He commented that if you are going to have a downtown, you need an anchor. Demeules noted that traffic patterns have changed and this also greatly impact the downtown. Tapper stated that the City should abandon Highway 75 as a major thoroughfare as 7th Street is the natural thoroughfare. Tapper noted redevelopment should include housing with amenities that attach to the river. He commented that part of the restriction under the current plan is that you can't change the blocks and most anchors don't want to be up against the street. Fair noted that property owners don't necessarily agree with this plan. Tapper stated that eventually those businesses will cease. Frie noted that it has taken decades for that to happen. Fair also noted that there are absentee landlords and financial limitations to redevelopment. Without condemnation as an option, the only way to acquire property is to buy it, and these property owners are not willing sellers. Fair noted that it will also take political direction and support. Koropchak stated that this is good discussion for the downtown. However, this exercise is intended to develop an action plan for Places to Work and how to attxact jobs and expand the tax base. She stated that her recommendation is to start identifying desired jobs and wages and appropriate locations. Koropchak explained that there are also non- industrial businesses that provide support to 'industry, including lodging, office, etc. Ultimately, the goal is allowing more people to live and work in Monticello, supporting other comp plan goals such as move-up housing. Tapper suggested that what Monticello is actually striving for is a good mix of employment, ranging from the executive level, down to those who do the work. There is then a need to plan for the facilities that meet the needs of all of those people. He indicated that the group should think about the next wave and who might be the next company with an idea that will revolutionize. Fair agreed, noting the support of venture capital firms who make these investments. Demeules noted Chaska has incubator and suggested reviewing strategies. Koropchak noted that there are so many different facets of bioscience, the City will need to determine what to concentrate on. Koropchak referenced that strategies maybe different for the different segments of the comp plan, but all facets of the City need to be on the same page in identifying what we are trying to attract. Tapper stated that he is concerned about using the comp plan structure because of duplication in strategies. He stated that he would like to boil them down to a more succinct level and then assign tasks. He also stated that he is concerned about the designations of Places to Work and Places to Shop. He noted that this seems to imply that Places to Shop are not Places to Work and creates a mentality that there is not a compatibility between the two. Koropchak stated that it is her goal to have the EDA write an action plan based on comp plan. However, if there are concerns with the comp plan in terms of designation, those should be addressed as part of the public hearing. The group ended discussion on this topic due to time constraints. d. Other. NONE. 5. Adjournment. MOTION BY COMMISSIONER FAIR TO ADJOURN. MOTION SECONDED BY COMMISSIONER VIERING. MOTION CARRIED, 5-0. MINUTES CITY OF MONTICELLO ECONOMIC DEVELOPMENT AUTHORITY Wednesday, April 9th, 2008 1. Call to Order. Chairman Demueles called the meeting to order at 6:10, and declared a quorum of the Authority present. 2. Roll Call Commissioners Bill Fair, Dan Frie, Bill Demueles, Bill Tapper, Bob Viering and Wayne Mayer present. Commissioner Herbst absent. 3. Reading of minutes. MOTION BY COMMISSIONER FAIR TO APPROVE THE CITY OF MONTICELLO EDA WORKSHOP MINUTES OF MARCH 12th, 2008. MOTION SECONDED BY COMMISSIONER FRIE . MOTION CARRIED, 6- 0. MOTION BY COMMISSIONER FAIR TO APPROVE THE CITY OF MONTICELLO EDA MINUTES OF MARCH 12th, 2008. MOTION SECONDED BY COMMISSIONER TAPPER. MOTION CARRIED, 6-0. 4. Agenda Addition Koropchak added as item 8g the consideration of an amendment to the contract for private redevelopment for the Front Porch project. 5. Approval of the EDA bills and communications. Fair asked if Koropchak was recommending approval of the bills, including the WSB billing included. Koropchak stated that they are new WSB invoices, which include a line item description of the work. Koropchak stated that recommends approval as described. Viering asked about how many more invoices will be coming on this project. Koropchak stated that she does not have the answer to that. She explained that EDA Minutes - 04/09/08 these invoices are for Otter Creek. Phases one and two are completed, but there will still be a phase three. Koropchak explained that when Finance Director Kelly gives his report, he may have a better feel for future project costs. They are still doing as-bunts and surveying for the first two phases. Tapper stated that it seems that the descriptions are fine, but the question is where they stand relative to budget. Koropchak stated that Kelly is analyzing estimates for land purchase, infrastructure improvements and what has been spent to-date. She stated that she doesn't have an immediate answer, but there was an estimate for the completion of the infrastructure. Viering asked if the EDA could have that by the next meeting. Koropchak stated that it was on the agenda, she and Kelly is working on it. Tapper stated that the hard part is that the EDA does not have any idea whether the invoices are reasonable. Fair noted some of the invoice expenses would be captured by the taxes. Viering stated that the issue is that it seems there is an open checkbook. Tapper stated that the EDA has a responsibility to keep this in check. Koropchak stated that she understands the need for accountability. Kelly noted that the City has changed its invoicing process because of questions like this. City Engineer Westby is now reviewing every bill that WSB is submitting to the City for a project. In addition, the City is trying to refine who can request WSB to complete projects. He stated that he is currently trying to put all the pieces of the industrial park back together. However, because many projects that have been run through that project code, the finances are in the process of being sorted out. Tapper stated that based on that information, he questions whether the EDA should be approving this bill. Kelly stated that the bill could be approved, as it is a legitimate invoice. Fair asked if there is any area on this that staff feels is deficient. Koropchak responded that these items are needed to complete the project. MOTION BY COMMISSIONER TAPPER TO APPROVE THE BILLS. MOTION SECONDED BY COMMISSIONER VIERING. MOTION CARRIED 6-0. 2 EDA Minutes - 04/09/08 6. Report of Executive Director. Koropchak noted that as of the date of the present meeting, the EDA had not received the first half of required payment from WRE Properties. She stated that she has not yet addressed a second letter. She stated that she will outline the EDA's discussion on how to improve the communication. Koropchak indicated that she plans to go out and visit with Walker. Koropchak recommended a second letter and a personal visit. Viering stated that it was his impression that Walker understood the invoice. Koropchak mentioned that the higher education group met on Friday the 4cn Anoka-Ramsey Technical presented a proposal with four options on ways that the committee could provide resources on classes and educational opportunities. Dr. Jim Benson, who was instrumental in working with business in relationship to job creation is scheduled to come to the next meeting on May 2°d Koropchak also reported that she and Susie Wojchouski will visit a higher education center in Apple Valley in the coming month. She noted that when the higher education committee makes a decision on a direction, there will most likely be a financial commitment needed, and so the group will need to research a source of funding. 7. Report of Committees Marketing Frie stated that the group is looking at vendors for a billboard sign on the freeway and the possibility of using a commercial industrial broker to some extent for industrial park. He stated that the group will come forward to the EDA with a recommendation. Fiber Optics Mayer stated that the task force is moving rapidly toward a bond sale, which will hopefully be within the next 4-6 weeks. He explained that there are many parallel paths being worked on in order to prepare for the bonds sale and get construction under way as soon as possible. Housing Viering reported that the committee had met and began discussion on the general housing issue and overall scope of the housing problem. The conclusion was to have a representative at an upcoming Greater Minnesota Housing Fund seminar on foreclosures and to look to GMMF as a resource for information on funding and technical expertise. 3 EDA Minutes - 04/09/08 He noted that the most important thing is that the program is not being looked at to bail out lenders or those in foreclosure. The goal is to get homes into the hands of first-time homebuyers. Tapper stated that the group is looking at a multi-prong approach. He explained that there may be a way to provide resources and education for those facing foreclosure, and address some of the problems that can be addressed by the City to make neighborhoods look better. He also reported that as another facet, the group is looking at assistance with gap funding. 7. Unfinished Business. a. Consideration to approve the revised January 2008 Kennedy & Graven (EDA General Matters) Invoice MOTION BY COMMISSIONER FAIR TO PAY THE REVISED 2008 KENNEDY & GRAVEN (EDA GENERAL MATTERS) INVOICE. MOTION SECONDED BY COMMISSIONER VIERING. MOTION CARRIED, 6-0. b. Consideration to hear subcommittee report on supplement gap funding program options to encourage purchase of unoccupied single- family homes and to authorize further direction. Koropchak noted this had been covered earlier. 8. New Business a. Consideration to call for a public hearing date to amend the Business Subsidy Criteria of the City of Monticello Economic Development Authority. Koropchak noted the recommended change to the business subsidy criteria was to separate the document into that which was TIF-related and that which is related to the loan program. Koropchak stated that separation, as well as the other changes noted would be made and sent to the Authority. MOTION BY COMMISSIONER FRIE TO TABLE ACTION ON THE PUBLIC HEARING DATE FOR THE BUSINESS SUBSIDY CRITERIA UNTIL THE EDA HAS REVIEWED THE FINAL VERSION OF CRITERIA. MOTION SECONDED BY COMMISSIONER FAIR. MOTION CARRIED, 6-0. 4 EDA Minutes - 04/09/08 b. Consideration to review and accept 2007 annual TIF/General Fund Reports. Kelly reported that he had used the general reporting form used in the past, and updated it as best as possible. He noted that because the audit is not completely finished, the reports may not be final. Kelly indicated that the report starts out with beginning cash balance for each district, along with revenue and expenditures. The report then provides the cash available at the end of the year. He reported -that most districts have positive cash balances, with the exception of newer districts which have start up costs and TIF hasn't come in yet to offset those expenses. T'he report also outlines loans and agreements and their status as far as what is outstanding. Fair asked if there will be any change to this document, given the historical nature of some of the districts. Kelly stated that because of time, he used the current format. Kelly commented that the format can be changed to "hide" the old districts. Frie asked about decertification. Kelly responded that most of the districts showing zeros have been decertified. Mayer stated that as far as the conversation about hiding old districts, he would prefer that they remain shown, given the new formation of the EDA. He indicated it is helpful to new members. Frie asked about districts 2, 5 and 6, and whether they do not have the more recent restrictions on fund use. Koropchak stated that districts 2, 5, and 6 are redevelopment districts and do not have all of the restrictions that newer districts do. She noted that in 2007, the City purchased the Cedar Street Garden Center, and because it was potential redevelopment property, the expenditure was taken from the revenues of that TIF district. Koropchak noted districts where the debt obligation has been paid off: In those districts, the EDA will receive TIF for the years until decertification, which does then provide dollars in each district. Koropchak reported that the cash surplus seems to indicate a deficit of $639,000. However, that is the balance of combined TIF districts. Kelly stated that when combined, although some districts have more restricted funds, overall the EDA has $675,000 in cash available. He noted that the previous Finance Director charged a lot of the legal and engineering to the general fund and didn't assign to the individual TIF district, which is part of the reason it appears that the funds are running a negative balance. 5 EDA Minutes - 04/09/08 Koropchak pointed out that district 1-22 was one of the largest TIF districts certified, and is the downtown district. She stated that the reports show the overall district, then each project within. MOTION BY COMMISSIONER TAPPER TO ACCEPT THE 2007 ANNUAL TIF/GENERAL FUND REPORT. MOTION SECONDED BY COMMISSIONER MAYER. MOTION CARRIED, 6-0. c. Consideration to review and accept the 2007 GMEF Financial Statements, Activity Report, and 2008 Budget. Koropchak reported that the GMEF has approximately $761,000 in cash currently. Additionally, the EDA has approximately $1.647 million in loans receivable. Koropchak stated that the majority of 2007 activity was interest income and interest on the notes. Again, the report uses the same format as previous years. Koropchak summarized action taken by EDA in 2007 and noted that the cash flow projections for 2008 are an estimate. She calculates this by starting with the cash fund balance and then looking at the payments due on the loans and then additionally estimates for interest income. The estimate includes some disbursement of loans. Kelly reported that the $100,000 repayment of liquor store funds still needs to be transferred out of this fund and repaid to the debt service to the City and applied to the levy. Fair noted that would happen this year, so the EDA should anticipate that reduction, essentially leaving a $661,000 cash balance. Koropchak reported that given all projections, the year-end cash balance would be approximately $639,000, assuming the EDA would approve loans of up to $300,000. Demeules confirmed that the $100,000 repayment would be used to reduce the bonded indebtedness of the City and would not go to the general fund. Koropchak confirmed. MOTION BY COMMISSIONER VIERING TO ACCEPT THE EDA FINANCIAL STATEMENTS AND ACTIVITY REPORT FOR SUBMISSION TO THE CITY COUNCIL ON APRIL 14TH, 2008. MOTION SECONDED BY COMMISSIONER FRIE. MOTION CARRIED, 6-0. 6 EDA Minutes - 04/09/08 d. Consideration to review year end balance of other sources of revenue. Kelly noted again the use of previous format for reporting on this item. He stated that the MN Investment fund includes two outstanding loans. These are TCDC, which was paid off in 2007 and UMC, which ends this year with a balloon payment. A summary of the different lines of credit that the City has open was also provided. Koropchak stated that the TCDC loan fund payments are federal dollars with restrictions. Once the EDA has loaned those funds again, they are recycled and federal restrictions will not apply. UMC's funds are available for job creation. Koropchak stated that she wanted EDA to have a record to show the loans approved using the liquor store funds. e. Consideration to review revenues and expenditures associated with the development of Otter Creek Crossings. Removed. f. Consideration to establish and approve a deposit and fee range for the Preliminary Development Agreements. Koropchak stated that this had been discussed briefly at the workshop. The EDA had talked about establishing a deposit associated with the development agreement. She indicated that currently, the only administrative expenses accounted for are those from Ehlers & Associates. Koropchak indicated that she had provided information on what the flat rates are for by district and type. She stated that she had also asked Kennedy & Graven to provide their rates and information on a flat fee for establishment of districts and associated contracts. Mr. Bubul responded that is not their general practice. Koropchak reported that the administrative costs typically range from $15,000 - $17,500. She noted it had been some times since establishment of a district outside of Otter Creek. Koropchak explained that a downtown redevelopment district could cost $10,000 - $19,000 just for the fee. Viering suggested a letter to accompany the draft development agreement as a means of improving communication. Viering stated that his feeling is that the best Ehlers & Associates can do is provide an estimate. He stated that he is not sure he agrees when it comes to legal fees as they should be able to readily provide as estimate once they know the parameters. 7 EDA Minutes - 04/09/08 Koropchak stated that she thought their hesitation is that costs don't relate to the size of the project, but rather how many amendment and changes are made to the agreements. Viering responded that he is not asking for flat fees, just asking for estimate once the deal is put together in principal, and should be done with each transaction. Koropchak commented that when the EDA evaluates projects in terms of criteria and performance, that is the point at which the preliminary agreement is signed. She sought confirmation that it is at that time that Viering would like to include those estimated costs into the addendum. Veiring confirmed. Frie noted that if the EDA sets a flat fee, it could then be paid back as an eligible expense through the TIF district. He asked if that affects the amount they could request. Koropchak stated that it would provide a clearer idea of their costs. Kelly stated that he does not like the idea of getting the fee out of the increment. The costs occur in one year and through increment, the EDA would be spreading the costs out over 5-7 years. He recommended a deposit and that they be billed. Fair agreed, stating that these are the costs of doing business. He noted that some of these expenses are because the developer makes changes, not the City making those changes. Tapper stated that after looking at the numbers on the previous page, his opinion on the approach the EDA should take is that the attorneys provide an estimate and then revise the deposit to 50% of that amount. He would eliminate the estimated administrative costs. Koropchak confirmed that Tapper's recommendation is to revise the agreement to read much as it does, but eliminating the section where it references amounts and provide a number of deposit at 50% of the estimated cost. The estimate then also goes into the addendum, along with a statement of understanding that the developer is responsible for the actual expenses. Fair asked where in the process the developer would get this information. Koropchak stated that it would be provided when the EDA enters into a preliminary development agreement, within that agreement, it requests the deposit. Koropchak also noted that the actual administrative costs are greater than just these two things. Staff time is not currently charged to these projects, for instance. Tapper asked if she is proposing changes. Koropchak stated that she is not. In terms of process, she noted that 8 EDA Minutes - 04/09/08 previously, when the EDA issued certificates of completion, the City accounts for all admin costs, and the difference is then billed. Fair asked if by the time Ehlers and Kennedy & Graven are involved, the EDA already has a preliminary development agreement. Koropchak confirmed, stated that it is difficult because we are asking them to provide an estimate on a project that they have not reviewed. Tapper inquired why the EDA can't expect them to do this research. For example, in his business he has to give estimates long before a final project is defined. Viering agreed, stating that they shouldn't charge to give an estimate. Koropchak noted that generally the consultants and the attorney have not been that much involved in the preliminary negotiations or in analyzing the TIF. Koropchak stated that she does not authorize their expenditures until the preliminary development agreement is executed. Demeules asked if Walker In-store is the only time the EDA has had this issue. Koropchak stated that in many cases, developers are not happy to get the bill, but have always paid it. She stated that the goal should certainly be to try to eliminate that surprise and put it into the financial model. Demeules noted that there is still an issue of providing an estimate and then finding that the developer is still be unhappy about the costs. He stated that he doesn't think the EDA can expect the attorneys to give an estimate. He noted that if it comes out higher, there will still be a have a unsatisfied customer. Tapper stated you can hedge that by saying it is estimated. Fair stated that the clarification needs to be in the original contract. The contract should also state that at some point there will be a final accounting. Viering stated it is a question of what the range of costs are. Tapper stated that there are really two problems, the amount over the deposit and the frequency of the accounting. Fair stated that at the last meeting, it was noted that Walker had requested cost information and had been given that information. He only asked for it once and was given it once. This addendum letter may help a little by providing historical background. Mayer asked how other municipalities have handled this. Kelly stated that other communities just set a deposit amount ranging from $10,000 to $20,000, depending on the project. He stated that the key may be that as a 9 EDA Minutes - 04/09/08 project starts to go over, the developer be billed for those charges, or note to them that they are going over. Mayer stated those additional costs are normally brought on because of extenuating circumstances. If changes are occurring, at that time staff needs to do a better job of informing the applicant. Fair noted that if it is a change the developer is requesting, it then puts the burden for reporting back on the City. Mayer asked if additional costs come about because of late billing. Schumann explained that billings aren't late, but rather the time from the original expense to accounting is often approximately 3 months, given billing and financial report cycles. Frie commented on his experience. The only way to eliminate all hard feelings is to have a flat fee. All other alternative would be better, but you will still create hard feelings in some circumstances. Fair stated the EDA should do the best it can in terms of providing the best estimates, as this document worked in a lot of cases. Tapper stated that from his perspective and from the documentation he's seen, the administrative costs were a concern from the outset. Fair stated that he would like the boilerplate agreement to refer to the amount as a deposit. Frie asked if it helps to see what 3-4 similar communities do. Mayer agreed. Kelly stated that he could do a list serve inquiry for fees and deposits in these agreements. Koropchak noted clarification would be needed in that email. The commissioners directed Koropchak and Kelly to work on this item. MOTION BY COMMISSIONER FAIR TO TABLE ACTION ON THE ESTBALISHMENT OF A DEPOSIT AMOUTN AND FEE RANGE FOR THE PRELIMINARY DEVELOPMENT AGREEMENT PENDING FURTHER INFORMATION. MOTION SECONDED BY COMMISSIONER MAYER. MOTION CARRIED, 6-0. g. Reassignment of contract for redevelopment as related to the Vine Place Townhomes (Front Porch) project. Koropchak reported that she had received a call from 1St National Bank requesting an amendment to the contract because there were two-three .homes not yet completed. These are outside of the TIF district. The developer request an extension of the private redevelopment contract to 10 EDA Minutes - 04/09/08 December 30, 2008 to allow those units to be completed. The bank was working with the developer and looking to extend the maturity date on the note to April 1, 2011. The bank's attorney wanted an agreement between the EDA, City and the bank recognizing that extension. EDA attorney Steve Bubul has reviewed this, but she has not heard back from them. She noted that the EDA could approve this, subject from EDA attorney. It was noted that this item would also go on to the City Council. MTTION BY COMMISSIONER FAIR TO AMEND THE PRIVATE CONTRACT FOR REDEVELOPMENT FOR FROTN PORCH TO EXTEND THE DATE OF COMPLETION TO DECEMBER 30, 2008. MOTION SECONDED BY COMMISSIONER TAPPER. MOTION CARRIED, 6-0. 9. Adjourn. MOTION BY COMMISSIONER TAPPER TO ADJOURN. MOTION SECONDED BY COMMISSIONER MAYER. MOTION CARRIED, 6-0. 11 • 4. Approval of the EDA bills and communication. A. Reference and background: EDA Agenda - 05/21/08 There is one EDA invoice from Ehlers & Associates in the amount of $416.25 (Exhibit A), four invoices from Kennedy & Graven for a total of $1,540.78 (Exhibit B), two invoices for the first-half property taxes associated with the Garden Center {(paid) Exhibit C}, and an invoice from WSB for $1,677.00 (Exhibit D). Given I noticed in the Apri128 Council packet for Council approval another total of $7,970.50 WSB bills (Dalton and Otter Creek) charged to the HRA General Fund and given the EDA questions regarding Otter Creek public improvement estimates and actuals to date and anticipated forthcoming invoices; you may wish to invite Bret Weiss, WSB, to an EDA meeting to answer your appropriate questions. B. Alternative Actions: A motion to approve payment of invoices EXHIBIT A, B, C, and D.. • 2. A motion to deny approval of payment for voices. 3. A motion approving or denial of individual payment of voices. 4. A motion to table. C. Staff Recommendation: Staff recommends Alternative No. 1 and to invite WSB to a future EDA meeting. The recommendation to pay the invoices is because of the uncertainty as to when the EDA will meet next. D. Sub o~ rting Data. Copy of invoices • c cl 0 N }+ O N R, ai O 't� 4p En 0 O O cd O P. '� •n En y OV � • C) '+ � i�r iii cn +-+ cd cn C4 O c1 cd N Cl ' O O 4-i .fl +.+ +, 4-4 C> O U M 4r O U vn v� N O ¢� i 'o ++ +1 k!1 Ly N cd + ' $-4 vi �-j .� 0 0 U �i N O L". .O O bA N O t, ti N U O 0 ,.O � O U O N 49 49 0 a w w w x w" W N Cd g.. Q O0 O N o � 0 0 U �i O L". .O O $., bA O t, ti N U O N ,.O � O U O N 49 49 0 a w w w x w" W 0 M V 00 00 M Ln M U) J (a 2 C: a) '0 V) Q) E LL a) 0) (0 Q 0 D LL 4 N a 0 d 0 0 O Ln O rte. Minnesota St 0 4i'4' rl'!' 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O 0) c 2 H N a0.+ �- Ca = 4% d M O LL c m Z, (S Z m O .O N N a (n 0 `�° o c E m L> C a ii a o -f-0 -Y (A d ��� N ��LL o aEi 20 -u :3 In 33m �aro��o" m oma" o. ago>���r`aa�i oZ) d LnaLnU2J 0OF i�mHU (n EU-) GCS iLLMMOOD.D-LL w E LA m E Ln m M�� LL m .4 u) m Or"a fu fu Q:mmm IA m E Eo EcY0 O E o > 0�� 0 v > Q:mLLJ Ehlers & Associates, Inc. !- - Leaders in Public Finance 3060 Centre Pointe Drive Roseville, MN 55113... ~ , (651) 697-8500, ~~ Financial Advisory Services Invoice Monticello Economic Development Authority 505 Walnut Avenue, Suite 1 Monticello, MN 55362-8822 Project: Otter Creek cashflow analysis Date Worked ~ Description of Services Invoice #: 337060 Invoice Date: April 10, 2008 Hours Amount 03-31-2008 MTR Meeting with Ollie and Tom K. on Otter Creek obligations 2.25 416.25 and calculations t~.~ 1~ 11 ~ ~ 2.25 $416.25 ---- -------------- APR 1 i 2(?Q$ Amount Due This Invoice $416.25 ci~r a~ I~o~az~IC~~.LO o~ .`~ `~`~~ ~~~ ~~ (Detach at perforation and return lower portion to Ehlers & Associates, Inc.) Monticello Economic Development Authority Invoice #: 337060 Invoice Date: April i 0, 2008 Amount Due This Invoice $416_25 ~ Please remit payment to: Ehlers & Associates, Inc. Attn: Accounts Receivable Due Upon Receipt 3060 Centre Pointe Drive Roseville, MN 55113 Kennedy & Graven, Chartered 200 South Sixth Street Suite 470 Minneapolis, MN 55402 (612) 337-9300 41-1225694 April 29, 2008 Invoice # 83251 City of Monticello Accounts Payable 505 Walnut Street, Suite 1 Monticello, MN 55362 MN190-00101 General HRA Matters Through March 31, 2008 \r,.~,l~.~. E~ ~ For All Legal Services As Follows: Hours Amount 3/3/2008 SJB Telephone conference with O. Koropchek; regarding 0.30 60.00 conflict questions. 3/3/2008 CAH Conference with S Bubul regarding conflict of interest 0.20 41.00 issue 3/31/2008 SJB Check on status of EDA conflict bill. 0.30 60.00 Total Services : $ 161.00 For All Disbursements As Follows: Photocopies 3.20 Postage 0.97 Total Disbursements: $ 4.17 Total Services and Disbursements:$ Ni aY - ~ r)r 165.17 (CITY CAE ~,~~~Tl~EL.L(l e ~3 Kennedy & Graven, Chartered 200 South Sixth Street Suite 470 Minneapolis, MN 55402 (612) 337-9300 41-1225694 March 31, 2008 Invoice # 82743 City of Monticello Accounts Payable 505 Walnut Street, Suite 1 Monticello, MN 55362 MN190-00101 General HRA Matters Through February 29, 2008 For All Legal Services As Follows: 2/20/2008 SJB E-mail from and to O. Koropchak regarding subsidy act and loan program 2/25/2008 SJB E-mail to and from O. Koropchak regarding open meeting questions 2/28/2008 SJB E-mail from O. Koropchak regarding conflict of interest 2/29/2008 SJB Research EDA conflict questions Total Services For All Disbursements As Follows: Photocopies Postage Total Disbursements: Total Services and Disbursements:$ Hours Amount 0.30 60.00 0.25 50.00 0.20 0.75 40.00 150.00 300.00 1.20 0.41 1.61 301.61 Page: 2 --. ~,~ Kenned & Graven Chartered ~ ~ Y 200 South Sixth Street Suite 470 Minneapolis, MN 55402 City of Monticello February 29, 2008 MN190-00130 EDA and HRA Consolidation Through February 29, 2008 Hours Amount For All Legal Services As Follows: 2/5/2008 MNI Create transcript for EDA/HRA consolidation. 0.40 68.00 2/6/2008 MNI Create document list and explanation for HRA/EDA 0.80 136.00 consolidation. 2/6/2008 MNI Finalize transcript list and send to Dawn Grossinger and 0.70 119.00 Ollie Koropchak at City. 2/8/2008 MNI Revise transcript index for EDA restructuring. 0.20 34.00 2/11/2008 MNI Resend quitclaim deeds to O Koropchak for execution by 0.10 17.00 HRA. Total Services : $ 374.00 Total Services and Disbursements:$ 374.00 Page: 2 ~-- \nJ~.~lr".' Kennedy & Graven, Chartered ~~ 200 South Sixth Street Suite 470 Minneapolis, MN 55402 City of Monticello March 31, 2008 MN190-00117 Otter Creek Industrial Park Through March 31, 2008 For All Legal Services As Follows: Hours Amount 3/31/2008 SJB Review background documents in preparationfor meeting, 3.50 700.00 meet with O. Koropchak, T. Kelly and M. Ruff regarding status of accounting. Total Services : $ 700.00 Total Services and Disbursements:$ 700.00 -.'~ ~~ 1 i~ ~ ;,` I ~~TY ~~ ~~~~~~~I~~LL~ ~N'" ~- ROBERT J. HIIVALA ~ s WRIGHT COUNTY AUDITOR/TREASURER e ~ ~ 10 SECOND STREET N. W., ROOM 230 BUFFAIA, MN 55313-1195 M r ~ 763-682-7572 or 763-684-4540 '•°° www.co.wtight.mn.us BILL: 20900 _ Property ID: R155-010-067060 25871 1 AV 0.312 _ TAXPAYER ID: 36737 HRA FOR CITY OF MONTICELLO ATTN:OLLIE KOROPCHAK EXC DIR ~ ~+ 505 WALNUT ST STE1 s:s.n MONTICELLO MN 55362.8822 I,ItI++IJ+tJL+Il+ttddl~tLL+L+tLI+tLIILtt++~lllttl+l 6act-11 Twp•121 Range-025 ORIGINAL PLAT LTS 8,7,88 8 BLK B TAXPAYER COPY SAVE FOR FUTURE REFERENCE ~ ~ ~ PROPERTY TAX STATEMENT YOUR PROPERTY TAX VALUES & CLASSIFICATIONS Taxes Pa able Year: 2007 2008 Estimated Market Value: 178,400 187,000 Newlmprovementsl Expired Exclusions: -- Taxable Market Value: 178,400 187,000 Property Classr COMMERgAL COMMERCUIL ~;~ A Y V You may be edgible for one or even two refunds to reduce your property tax. REFUNDS'? Keaa me aaca al uus rraremen+ w Jrna ew nuw ru appry. Taxes Payable Year: 2007 2008 t. Use this amount on Form M1 PR to see if you are eligible: for a property tax refund- S 0.00 File by August 15th. IF BOX IS CHECKED, YOU OWE DELINQUENT TAXE&AND ARE NOT ELIGIBL~ 2. Use these amounts on Form Mi PR to see if you-are eligible fora special-refund - . S- 0.00 °Your Property Tax arrd How It Is Reduced By The State - 3. Your property tax before reduction by state-paid aids and credits S 4;639.73 S 10,297.73 4. :Aid paid by the State of Minnesota to reduce your property tax 4,236.84 4,282.73 5. A. Homestead and.agricuttural credits paid by the State of Minnesota to reduce your property tax 0.00 0.00 B. Other credits paid by the State of Minnesota to reduce your property tax 0.00 0.00 6. Yourproperty tax. after reduction by state-paid aids and credits. 8,403.18 6,008.00 Property Tax by Jurisdi~~~r couNn S 7. County 1,o94.ea S 1,1w.o4 o.oo o.oo 8. City or Town CITY OF MONTICELLO I,~ ('i a O ~ ~ ~? 1,514.80 1,766.63 6 , ` v *' 9. State General Tax 1,748.32 1, 82.28 10, G~.hoOII~n' trict: -A, Voter approved levies ^ (QI~i: U88Z~ ' 611.83 866.80 t l0 TIFoS .. B: Other local levies VOde: X1.3 , eIb505,. 3 327.86 322.99 11. Special Taxing Districts: A. HOSPITAL 106.29 84.28 B' C Initial: 0.00 0:00 . _ 0.00 0.00 D. N iz-b~ ~a,~ •,a W.~r ~~is~o ~ o.oo o.oo 12. Non-school-voter approved referenda levies 0.00 O.oO 13. Total property tax before special assessments i 6,ao3.te S 6,006.00 Special Assessment t~j1 Yiluljt~l' v ~ ~--..~5 PRINCIPAL 25.00 14C~~DEBT~~ det'd. k~- h 6. 0 1,014.81 26.00 2 J ~u~J ~ ' i ' 4 ~f i T U. 1! 15. YOUR TOT L Pt~QPIEiV~M 91A)I'A1~[i~~~AL SESSMENTS S 6,418.00 S 6,060.00 n,. _. ,_ee _..e. .,a ~.. n.n rr .,.... .. ....~.~ FIRST HALF DUE nnev ~R late, you will be charged a penalty. See beck Por rate. SECOND HALF DUE Detach and return this stub ~.g~c~r~half payment 2008 2ND HALF PAYABLE COMMERCIAL R166-010-067060 Property ID: RE TAX D# 36737 EC NO'H11LF TAXA rAX BILL# 20900 utP# R166-010-097010 3,015.Q0 iRA FOR CITY OF MONTICELLO s PEN. TOTAL MAKE CHECKS PAYABLE & MAIL TO: ' ' If your address has changed please REASURER ROBERT J. HIIVALA AUDiTOR/ 1 check this hox and show the change WR[CHT COUNTY 10 SECOND STREET N.W., ROOM 230 on the beck of riffs sub. BUFFALO, MN 55313-1195 OCTOBER 15 S 3,016.00 Detach and return this stub with your 1st half payment 2008 1ST HALF PAYABL~tAY 1b COMMERCIAL Property IDR166-010-067060 RE TAX r 36737 FULL TAl~1lYT X BILL# 20900 S 6,0 0.00 '# R166-010-067010 FX+ST HALF TAX AYT s 3,01'5.00 Ut FOR CITY OF MONTICELLO PEN TOTAL ^ MAKE CHECKS PAYABLE & MA[L TO: ROBERT J. HIIVALA AUDITORlCREASURER If your edNess has changed please WRIGHT COUNTY check This box and show the change 10 SECOND STREET N.W., ROOM 230 an the bank of this suh. BUFFALO, MN 55313-1195 .xN'° ~- ROBERT J. HIIVALA ~ s WRIGR'f COUNTY AUDITOR/TREASURER e ~i 10 SECOND STREET N.W., ROOM 230 ~ BUFFALO, MN 55313-1195 ~ ; +° 7fi3-682-7572 or 763-684-0540 •e° www.co.wrighl.mn.us BILL: 20899 Property ID: R155-010-067010 25871 1 AV 0.312 TAXPAYER ID: 36737 ~#. HRAFOR CITY OF MONTICELLO ATTN:OLLIE KOROPCHAK EXC DIR cn 505 WALNUT ST STE1 s:atn MONTICELLO MN 55382.8822 ~t~t~u~t~ut~~n~~tut~t~~u~t~u~ut~t~u~t~~~nuu~~~u~t ~ Sect-11 Twp•121 RargeA25 ORIGINAL PLAT LOTS 1,2,3,485 BLK B TAXPAYER COPY SAVE FOR FUTURE REFERENCE ~ ~ ~ PROPERTY TAX STATEMENT YOUR PROPERTY TAX VALUES & CLASSIFICATIONS Taxes Pavable Year: 2007 2008 Estimated Market Valuer 351,700 358,300 Newimprovementsl Expired Exclusions: Taxable Market Value: 361,700 369,300 Property Class: COMMERCAL COMMERCIAL K You maq be eligible for one or eren two refund[ to reduce your property tar. REFUNDS? Read the back of this sfakment to find oiU bow to apply. Taxes Payable Year: 2007 2008 L Use this amount on Form M1 PR to see if you are eligible for a property tax refund ~ S o.oo File by August 15th. IF BOX IS CHECKED, YOU OWE DELINQUENT TAXES AND ARE NOT ELIGIBL< 2. Use these amounts on Form Mi PR to see if you are eligible for a special refund i O.oo Your Property Tax and How If Is Fleduced By The State 3. Your property tax before reduction by state-paid aids and credits S 17,003.80 S 16,340.73 4. Aid paid by the State of Minnesota to reduce your property tax 7,461.43 7,616.7$ 5. A.- Homestead and agricultural credits paid by the State of Minnesota to reduce your property tax o.oo o.oo B. Other credits paid by the State of Minnesota to reduce your property tax o.o0 0.00 6. Your property tax after reduction by state-paid aids and credits 6,542.47 10,724.00 Property Tax by Jurisdiction 7. County WRIGHTCOUNTY S 1,930.80 S 2,100.88 o.oo o.oo 8. City or Town CITY OF MONTICELLO 2,668.06 3,115.07 9. State General Tax. K $,076.16 2.964.64 10. School District: A, Voter approved levies O TO PAY? ,,062.03 1,776.77 (Dist: 0882) g, Other IOCaI levies 586.88 560.01 , HOSPITAL G'~ll~: ~i 3, ,4650$, 3110 11. Special Taxing Districts: B ' 185.44 167.23 TrF o5 . 0.00 0.00 C. Initial: 0.00 0.00 D. 0.00 0.00 12. Non-school voter approved referenda levies -0.00 0.00 13. Total property tax before special assessments S 9,642.47 S 10,724.00 tirjP" Specia Ass ~9 ~ P ~ ~"-- ~ INTEREST 471.18 PRINCIPAL 1,520.82 14. S ecial Ss '° d~ t t ~ E bill 2,067.53 1,992.00 UTiLIT1E ~ "" , i CO SW 000-0 25.0 1 fv1AA ? 5 ~iii~ 15. YOUR T~~~~eYt.lwyo a0y~~~EGI L ASSESSMENTS S 11s1o.oo S 12,71s.oo 'Ibxes o[ 550.00 or less must he paid in full. I[ you pay your taxes FIRST HALF DUE MAY 15 S 6,358.00 late, you will be charged a penalty. See back For rate. SECOND HALF DUE OCTOBER 16 S 6,358.00 Detach and return this stub with your 2nd ha1P payment Detach and return this stub with your 1st halt payment 2008 2ND HALF PAYABLE OCTOBER 1b 2008 1ST HALF PAYABLE MAY 16 COMMERCIAL COMMERCIAL Prop@rty ID: R166-010-067010 RE TAX Property ID: R155-010-067010 RE TAX ID# 36737 $ECONDHACf TA%A11T ; ID# 38737 ~u' " TAX BILL# 20899 TAX BILL# 20888 2;7,00 7 6 MP# R155-010-087010 MP# R155-010-067010 rixsrBALFrAxAUr 6,358.00. s 6,358.00 HRA FOR CITY OF MONTICELLO HRA FOR CITY OF MONTICELLO PEN .. PEN ..TOTAL TOTAL ^ ^ MAKE CHECKS PAYABLE & MAIL TO: MAKE CHECKS PAYABLE & MAIL TO: ROBERT J. Hi[VALA AUDITOR/TREASURER If your address has changed please ROBERT J. HIIVALA AUDITOR/TREASURER If your address has changed please WRIGHT COUNTY check This boz end show the change WRIGHT COUNTY check This box and show the change 10 SECOND STREET N.W., ROOM 230 on the beck of this sWb. 10 SECOND STREET N.W., ROOM 23U on dte back of Ws sWb BUFFALO, MN 55313-i 195 ~; BUFFALO. MN 55313-1195 ~~~ & Associates, Inc. Infrastructure 1 Engineering 1 Planning 1 Construction City of Monticello Attn: Tom Kelly 505 Walnut Street, Suite 1 Monticello, MN 55362-8831 March 26, 2008 Project No: 01627-570 Invoice No: 20 Dalton Ave & Westerly Road Extension (Dalton Court) CP# 2006-15C Professional Services from February 1. 2008 to February 29, 2008 701 Xenia Avenue South Suite 300 Minneapolis, MN 55416 Te1:763-541-4800 Fax:763-541-1700 r-. ~~ ~ ~' Phase 3 Construction Professional Personnel Hours Rate Amount Project Management/Coordination Elkin, Phillip 2/1/08 2.00 105.00 210.00 Elkin, Phillip 2/13/08 1.00 105.00 105.00 Elkin, Phillip 2/15/08 3.50 105.00 367.50 Elkin, Phillip 2/28/08 1.50 105.00 157.50 Weiss, Bret 2/4/08 .50 134.00 67.00 Weiss, Bret 2/13/08 1.00 134.00 134.00 Weiss, Bret 2/20/08 1.00 134.00 134.00 ~ Weiss, Bret 2/27/08 1.00 134.00 134.0 1~°~ As-builts Cunningham, Jacob 2/28/08 4.00 68.00 272.00 ~,, Made PDF's, sent plot files to Franz ~ Hackman, Doug 2/21/08 1.00 96.00 96.00 Drafting of as-built plans Totals 16.50 1,677.00 Total Labor 1,677.00 Total this Phase $1,677.00 Total this Invoice $1,677.00 Billings to Date Current Prior Labor 1,677.00 84,136.25 Consultant 0.00 2,429.19 Expense 0.00 440.00 Field Services 0.00 49,409.00 Totals 1,677.00 136,414.44 Tota I ~ T~ ~A~? 85,813.25 --- 2,429.19 ~i~d~ 440.00 • 49,409.00 ~r1i~~c1~ 138,091.44 • Minneapolis 1St. Cloud Equal Opportunity Employer Project 01627-570 MONT -Dalton Ave and Westerly Road Invoice 20 Exte Comments: >~1rot~/ lfS~v/ l`kt ~ I,tJR/~-'^~~ C~h`~~,~~twRr~ i S5 ~+'CS r r Approved by: Reviewed by: Bret Weiss Project Manager: Shibani Bisson l.~ ~ Page 2 EDA Agenda - 05/21/08 5. Report of Executive Director. a) IDC Higher Education Subcommittee -This subcommittee originated as a result of the SCSU Bio Science Study and supports the economic development objectives of the Comp Plan. The committee is comprised of four of Monticello's larger employers: Cargill Kitchens, Monticello Big-Lake Hospital District, Xcel Energy (Monticello Nuclear Plant), and UMC along with the Monticello School District, St. Cloud State University, Anoka-Ramsey Community College, Small Business Development Center, Senator Amy Koch, Mayor Herbst, Administrator O'Neill, Chamber Assistant Director Wojchouski, and Economic Development Director Koropchak. The committee's purpose is to explore the possibility of the City of Monticello becoming a higher education community. This a great economic development tool with the long-term vision to branch out to the surrounding communities. The group met on Apri14`b. ARCC presented three proposals: Needs Assessment, Focus Groups, and Higher Education Center Coordinator Pilot. The group is looking for input on the ARCC options from UMC and the Hospital District, prior to further direction. On Apri125, Susie Wojchouski and Koropchak visited Partners in Higher Education in Apple Valley, agrass-roots for-profit organization, which is a partnership or family among Dakota County Technical College, St. Mary's University, and Inver Hills Community College. On May 2, Dr. Bensen, past President of Dunwoody Institute and Bemidji State University, gave an energizing presentation. See Exhibit A. The subcommittee will meet again June 5. NO RECOMMENDATION HAS COME FORWARD FROM THIS GROUP. b) EDA Housing Subcommittee -The committee (Tapper, Viering, and Frie) has narrowed its focus to two subdivisions in Monticello to get a handle of the housing market in Monticello. The committee is exploring potential assistance alternatives to encourage single-family, owner- occupied housing sales to increase the population and spur the local economy, increase neighborhood property values, create clean and aesthetically pleasing neighborhoods, reduce continued foreclosures, and encourage safe neighborhoods. The range of alternatives under consideration are awareness/aggressive approach (clean up properties/ordinance enforcement), education by local lenders, repair funds, and/or gap funds. A seminar in St. Cloud by the Greater Minnesota Housing Agency was held Apri129 and Bob Viering will update the commissioners. Through a conference call on April 17, a number of sources of funds were identified through various state/regional agencies. NO RECOMMENDATION HAS COME FORWARD FROM THIS GROUP. Attached some info prepared by County Assessor. Exhibit B. c) IDC/EDA Marketing Subcommittee -This group met on April 21 and elected to rent a billboard from Lamar Outdoors. The eight and one-half month rental contract will commence May 15 and run through the end of the year. Total cost approximately $8,500 plus installation. The billboard is located along I-94 between County Road 18 and Highway 25. The "Business Opportunities" message will change at least once during the contract from City-wide 100% C EDA Agenda - 05/21/08 fiber optics to Land for $1.00 per sq. ft. Use of web site and city logo will be consistent. Exhibit C. A listings presentation will be requested from Welsh, CB Richard Ellis, and United Properties for consideration to possibly list the Monticello Business Center (greater exposure). A promotional event including breakfast or lunch, tour of city, and golf is also being planned. d) Satisfaction of Mortgages for UMC project -With the balloon payments paid by UMC on the GMEF Loan and the City Loan (MIF), documents were prepared, executed and mailed to the company for recording at Wright County. e) Walker-In Store - I met with Brian and Diane Walker on April 28 and toured their facility. They are ready and waiting to sign-up for 100% fiber and suggested in the future that another industrial business owner be assigned as a mentor to a new business during the funding application process. They also noted the need for a hospitality hotel/motel as an alternate lodging option for the Monticello business community. The EDA did receive the first one-half of the administrative short-fall and I left my visit with a positive feeling. See Exhibit D. f) Karlsburger Foods - I visited with Mike Maher in the process of gathering job reporting information. They have created three new jobs at above targeted wage-levels and retained their 16 workers. Mike reported they had about 174 applications for job openings. They are very interested in and support the efforts of the Higher Education Subcommittee. Recently, they held athree-day weekend sales meeting in Monticello which put dollars into the local economy. It was noted that the City of Monticello needs motel/hotel alternatives that cater to the business community with amenities such as conferences/restaurants etc. g) WSI has requested a building permit fora 12,500 sq ft expansion. The company reviewed the benefits of the GMEF and elected not to use the program. They currently have a $350,000 GMEF loan for the acquisition of the property from Remmele Engineering in 2004. Staff meeting May 8 about outdoor storage. h) Another local manufacturer plans to expand in 2008 also. i) At the IDC meeting in May, they voted to change their name to Monticello Industrial and Economic Development Committee and amended their Action Statement. See Exhibit. j) Comp Plan Public Hearing -Planning Commission, Wednesday, Apri130. Planning Commission approved the Plan and the Council will consider approval of the Comp Plan in May. k) Attended Central Minnesota Manufacturing Breakfast, April 24, 7:30 a.m., River City Extremes, Monticello. 1) Letter of Resignation Exhibit E. - AND A BIG THANK YOU FOR ATTENDING MY RETIREMENT CELEBRATION. ANGELA, KITTY AND STAFF REALLY DID UP A PARTY. I'm happy about retirement but I will miss each of you and the past EDA/HRA commissioners. You are the greatest. Mark Ruff and Steve Bubul honored me with a dinner last night in downtown Minneapolis. Promise, no cost to the EDA. m) Downtown Mueller Theater -.Gary Anderson, Angela Schumann, and myself met with Bob Mueller and toured the theater on East Broadway, Apri130"'. He asked: What is the City's EDA Agenda - 05/21/08 plan for the area? We encouraged him to first contact Chuck Van Heel as to his interest knowing the Workforce Center is relocating to the previous FSI building along East 7 Street and to what Van Heel has in mind for the area or doesn't have in mind. And secondly, suggested or welcomed him to an EDA meeting. I did talk to Bob on May 8 and he plans to meet with Wayne Elam (works for Chuck) within the week. He indicated he may come to the EDA meeting on May 21. Exhibit F. n) West Broadway/previous Fluth parcel -attached is a letter from Semper Development. I spoke with Kim Perry on May 9. Semper Development is a development company inquiring about the potential to assemble parcels in the downtown area on behalf of an undisclosed client. I informed her the EDA was open to downtown redevelopment, interested in hearing a concept plan and selling, and invited her to a future EDA meeting. She was advised the City's Comp Plan included a Downtown Revitalization Plan and gave her Angela's name and phone. See Exhibit G (Letter and Property Tax Information) o) Some selling prices per County -Maus building and property on Highway 25 - $2,100,000 commercial. FSI building and acreage $2,450,000 I1-A. 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I— SEMPER DEVELOPMENT May 5, 2008 Current Owner Monticello HRA 505 Walnut Street Suite 1 Monticello, Minnesota 55362 RE: PID# 155-010-052071, Monticello, Minnesota Dear Owner: ~xl- G ~~~~~~ MAY - 6 2008 CITE 01= ~~~ONTICELLO Semper Development, Ltd has an interest in purchasing the above referenced property. -Please contact me at 612-332-1500 to discuss potential options. Sincerely, t ~, ,N`- ~-e~~t'1 c~---- Kim Perry Acquisitions Minnesota 80 South Eighth Street IDS Center, Suite 1275 Minneapolis, MN 55402 p. 612.332.1500 / f.612.332.2428 Colorado 8000 East Prentice Avenue Suite C-3 Greenwood Village, CO 80111 p. 303.825.7800 / f.303.825.7801 Wright County » Property Search » ~~~1~l~ ~"tJ~dJx,, ~~.~ Home » Property, Environment & Parks » Pro e » Property Search » Results List » Pazcel Data Property Search View Parcel Parcel Data Pagelotl The property information database is updated daily. Last updated: S/8/ZOOS ~~®~ Parcel Data ~ ~ ' ~ ~ r Property ID: 155-010-052071 . _........... Tax Year: 2008 Property Address: Municipality: CITY OF MONTICELLO School Dist : 0882- SD 0882 MONTICELLO Owner Name: Taxpayer Name & Address: MONTICELLO HRA MONTICELLO I-iRA 505 WALNUT ST STE1 MONTICELLO MN 55362 Lot: Section: 11 Plat Name: Block: Township: 121 ORIGINAL PLAT Range: 025 Deeded Acre: 0 Legal Description: LTS7&8BLK52EX SELYI6.SOFT OF SWLY90FT OF LT8 Note: Legal descriptions here are for tax purposes only. Do not use them for recording purposes. New Search :: Parcel Data :: Tax Summary :: Tax Statement :: Assessment :: Appraisal :: Sales Detail :: Pay Taxes As a public service Wright County is providing access to information maintained by Wright County for individual parcels of property. This information is to be used for reference purposes only. Although reasonable efforts are taken to publish the most current property information, Wright County does not guarantee accuracy of the material contained herein and is not responsible for misuse or misinterpretations. HOME PAGE ~ YOUR COUNTY GOVERNMENT ~ HEALTH FINANCIAL & SOCIAL SERVICES ~ PUBLIC SAFETY. LAW & LEGAL (LICENSES & CERTIFICATES ~ PROPERTY. ENVIRONMENT & PARKS ~ HIGHWAY MANAGEMENT & TRANSPORTATION ~ SALARY DATA NOTIFICATION ~ EARC ~ FA ~ SITE MAP ~ GQVERNMENT PORTAL (EMAIL ©2008 Wright County All Rights Reserved Contact the Webmaster http://www.co.wright.mn.us/department/audtreas/proptax/results.asp?pid=155010052071 &t... 5/8/2008 Wright County » Yraperty Search » Home » Property, Environment & Parks » Pro e » Property Search » Results List » Assessment Summary Property Search View Parcel Assessment Summary The property information database is updated daily. Last updated: 5/8/2008 ~® ~ ~ Assessmerrt Property ID: 155-010-052071 Tax Year: 2008 __ Yage 1 al; 1 Values 1 2 3 4 5 Estimated Land Market 56,600 Estimated Building Market 0 Estimated Machinery Market 0 Excluded Market 0 Total Estimated Market 56,600 Land Limited 0 Building Limited ~ 0 Total Limited 0 Classifications Property Type MUNICIPAL PUB-OTHER Homestead Status NON- HOMESTEAD Exempt Status EXEMPT New Search :: Parcel Data :: Tax Summary :: Tax Statement :: Assessment :: Appraisal :: Sales Detail :: Pay Taxes As a public service Wright County is providing access to information maintained by Wright County for individual parcels of property. This information is to be used for reference purposes only. Although reasonable efforts are taken to publish the most current property information, Wright County does not guarantee accuracy of the material contained herein and is not responsible for misuse or misinterpretations. HOME PAGE ~ YOUR COUNTY GOVERNMENT ~ HEALTH. FINANCIAL & SOCIAL SERVICES ~ PUBLIC SAFETY. LAW & LEGAL ~ LICENSES & CERTIFICATES ~ PROPERTY. ENVIRONMENT & PARKS ~ HIGHWAY MANAGEMENT & TRANSPORTATION ~ SALARY DATA NOTIFICATION ~ SEARCH ~ FAO'S ~ SITE MAP ~ GOVERNMENT PORTAL ~ EMAIL © 2008 Wright County All Rights Reserved Contact the Webmaster http://www.co.wright.mr t ~/department/audtreas/proptax/results.asp?pid=155010052071&s... 5!8/2008 Wright County » Property Search » Home » Property Environment & Parks » Pro e » Property Search » Results List » Sales Detail Property Search View Parcel Sales Detail The property information database is updated daily. Last updated: 5/8/2008 ^ ~, ~ ~t~. Property ID: 155-010-052071 Tax Year: 2008 Page 1 of 1 Sales Detail Sale Date Qual Multi- Sale Adj Sale Buyer Seller Parcel Price Price 5/1/1996 U No 50,000 50,000 HOUSING & REDEVELOPMENT FLUTH AUTH 12/1/1986 7/1/1986 ~U ~U No No 115,000 105,200 115,000 105,200 FLUTH JOHNSON JOHNSON JOHNSON New Search :: Parcel Data :: Tai Suminarv :: Tax Statement :: Assessment :: Appraisal :: Sales Detail :: Pa~Taxes As a public service Wright County is providing access to information maintained by Wright County for individual parcels of property. This information is to be used for reference purposes only. Although reasonable efforts are taken to publish the most current property information, Wright County does not guarantee accuracy of the material contained herein and is not responsible for misuse or misinterpretations. HOME PAGE ~ YOUR COUNTY GOVERNMENT ~ HEALTH FINANCIAL 8~ SOCIAL SERVICES ~ PUBLIC SAFETY. LAW 8~ LEGAL ~ LICENSES i~ CERTIFICATES ~ PROPERTY ENVIRONMENT & PARKS ~ HIGHWAY MANAGEMENT & TRANSPORTATION ~ SALARY DATA NOTIFICATION ~ SEARCH ~ FAQ'S ~ SITE MAP ~ GOVERNMENT PORTAL ~ EMAIL © 2008 Wright County All Rights Reserved Contact the Webmaster =155010052071 &s... 5/8/2008 EDA Agenda - 05/21/08 7. Unfmished Business: A. Consideration to review the amendments to the EDA Business Subsidy Criteria ~TIF) and to call for a public hearing date to approve amendments. A. Reference and background: At the April EDA workshop, the commissioners continued to review the partially revised and combined HRA and EDA Business Subsidy Criteria. Upon completion of the review of the combined document, the commissioners requested a separate set of criteria for the GMEF and TIF. The attached is the EDA Business Subsidy Criteria for Tax Increment Financing and the highlighted areas identifying the revisions by the commissioners. Unlike the GMEF Guidelines which need approval by the City Council prior to any changes or modifications, the EDA Business Subsidy Criteria for TIF only require a public hearing on the business subsidy amendments (Page 1, 1:03). Please review the final draft for any last minutes changes and then consider calling for a public hearing date. B. Alternative Action. A motion to call for a public hearing date to approve the amendments to the EDA Business Subsidy Criteria for TIF. Suggested Public hearing dates: July 9, 2008 or other (Regular scheduled EDA meeting -the public hearing notice must appear in local newspaper two weeks prior to the public hearing). 2. A motion to table setting a public hearing date for amending. C. Recommendation: First, you must be satisfied with the proposed amendments. Secondly, is the question of available staff to follow through with the public hearing process. Waiting until at least July 9 would allow the EDA to hold both public hearings at the same meeting (see next agenda item) D. Supporting Data: Copy of Criteria with proposed amendments highlighted. • ►: 03 .fl o [c3 s -y CIS CC U US � N toGO .� N N N U W 03 'D y •� vOi I C� O 4, v� A O C/� U N � Q\ �i O 4--1 4. 79) tn--. H �I a> yl by ".3 CZ Cd 'O O rA Cd Cd 001 'U Cc o a� W u o 0 c d a o? � V a°i uco cn o Gq o 0 0 > Y cli En C. z 7:1 �. O oEn Z;5 1. 'Ell°o° d c� o m H N U) cn cd ..ct •� "� �j O �, +d s QJ N O N Q Q O O aj V Cd v b 0 0 ~ ~ ~ N N h �1 N Cd U to U S"r _o O Cd Off, Cd N cn 'd co co Cn Cl) cn G' I �I m M O v� y o O cd c N cd � �U � O N c U Cd Cd U _Cd C o $:Iq 5 N "C O � O � � � O o cd O N 40 O 7C 3~ U •.-� o A a., c Cd (7) O N o � -d to 4 r. � O •0 U N O o � 0 o � U U � O C4 Cd bbA Cd � U � U Cd 4.1� U � U O c i' A H � I Cd 0 'd � 3 N 4-� �. 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Unfinished Business: B. Consideration to review the amendments to the EDA Business Subsidy Criteria (GMEF reauesting City Council approval and to call for a public hearing date to approve amendments. A. Reference and background: At the April EDA workshop, the commissioners continued to review the partially revised and combined HRA and EDA Business Subsidy Criteria. Upon completion of the review of the combined document, the commissioners requested a separate set of criteria for the GMEF and TIF. The attached is the EDA Business Subsidy Criteria for Greater Monticello Enterprise Fund with the areas in red identifying the revisions by the commissioners. First, the GMEF Guidelines need approval by the City Council prior to any changes or modifications (page 9, MODIFICATIONS). The public hearing for approval of the EDA Business Subsidy Criteria for GMEF will follow Council approval (Page 1, 1:03). Please review the final draft for any last minutes changes and then consider: Date for Council approval and calling for a public hearing date. B. Alternative Action. Action One -City Council approval A motion requesting the City Council review the proposed amendments to the GMEF Guidelines on: June 9, 2008 or June 23, 2008. or other . 2. A motion to table setting a date for Council approval. Action Two -Call for public hearing date 1. A motion to call for a public hearing date to approve the amendments to the EDA Business Subsidy Criteria for the GMEF. Suggested Public hearing dates: July 9, 2008 or other (regular scheduled EDA meeting -the public hearing notice must appear in local newspaper two weeks prior to the public hearing). 2. A motion to table setting a public hearing date for amending. EDA Agenda - 05/21/08 C. Recommendation: First, you must be satisfied with the proposed amendments. 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O N � 'O .4 O EO Q � O � O � f— cH ,fl O �* Ocd O 4� N cd $d 4, 4. 4 to bA 'C7 'd A 4UU, W 1-4 (b) Proceed to seek all necessary- information with regard to the anticipated public costs associated with the Development. G (c) Estimate the Authority's level and method of financial participation, if any, in the Development and develop a financial plan for the Authority's participation. 5. It is expressly understood that execution and implementation of the Contract shall be subject to: (a} A determination by the Authority in its sole discretion that its undertakings are feasible based on (i) the projected tax increment revenues and any other revenues designated by the Authority; (ii) the purposes and objectives of any tax increment, development, or other plan created or proposed for the purpose of providing financial assistance for the Development; (iii) a determination by the Authority that tax increment financing or other public financial assistance is reasonably necessary in order to make the Development feasible; and (iv) the best interests of the Authority. (b) A determination by the Developer that the Development is feasible and in the best interests of the Developer. 6. This Agreement is effective from the date hereof through , 200 .After such date, neither party shall have any obligation hereunder except as expressly set forth to the contrary herein. 7. The Developer shall be solely responsible for all costs incurred by the Developer. In addition, the Developer shall reimburse the Authority for Administrative Costs, as hereafter defined. For the purposes of this Agreement, the term "Administrative Costs" means out of pocket costs incurred by the Authority together with staff costs of the Authority, all attributable to or incurred in connection with the negotiation and preparation of this Agreement, the Contract, and other documents and agreements in connection with the Development, including without limitation the cost of financial advisors, attorneys, tax increment buildin inspection consultants, and planning and environmental consultants. In order to secure payment of the Administrative Costs, the Developer shall deliver to the Authority cash or a certified check in the amount of $ ,such delivery to occur upon execution of this Agreement. If at any one or more times during the term of this Agreement, the Authority determines that Administrative Casts will exceed $ and that additional. security is required, the Authority shall notify the Developer of the amount of such additional security. Within ten calendar days of receipt of this notice, the Developer shall deliver to the Authority the required additional security. The Authority will utilize the funds delivered by the Developer to pay or reimburse itself for Administrative Costs. Upon termination of this Agreement, the Authority will return to the Developer the funds paid by the Developer to the Authority pursuant to this Section 7, less an amount equal to the Administrative Costs. This Section 7 shall survive termination of this Agreement and shall be binding on the Developer regardless of the enforceability of any other provision of this Agreement. s.iH-x~~mss~i ~~iNi~x~-ioi Vh~,..4~ C'~~.,^ C. 7. The Developer shall be solely responsible for all costs incurred by the Developer. In addition, the Developer shall reimburse the Authority for Administrative Costs, as hereafter defined. For the purposes of this Agreement, the term "Administrative Costs" means out of pocket costs incurred by the Authority and City together with staff costs of the Authority and City, all attributable to or incurred in connection with the negotiation and preparation of this Agreement, the Contract, and other documents and agreements in connection with the Development, including without limitation all costs in connection with replatting of the Property and the cost of financial advisors, attorneys, and planning and environmental consultants. In order to secure payment of the Administrative Costs, the Developer shall deliver to the Authority cash or a certified check in the amount of $10,000, such delivery to occur upon execution of this Agreement. If at any one or more times during the term of this Agreement, the Authority determines that Administrative Costs will exceed $10,000 and that additional security is required, the Authority shall notify the Developer of the amount of such additional security. Within ten calendar days of receipt of this notice, the Developer shall deliver to the Authority the required additional security. The Authority will utilize the funds delivered by the Developer to pay or reimburse itself for Administrative Costs. Upon termination of this Agreement, the Authority will return to the Developer the funds paid by the Developer to the Authority pursuant to this Section 7, less an amount equal to the Administrative Costs incurred by the Authority through the date of notice of termination. For the purposes of this paragraph, Administrative Costs are considered to be incurred if they have been paid, relate to services performed, or are payable under a contract entered into, on or before the date of the notice of termination. This Section 7 shall survive termination of this Agreement and shall be binding on the Developer regardless of the enforceability of any other provision of this Agreement. 8. This Agreement may be terminated upon 5 days written notice by a party to the other party if• (a) if, in the respective sole discretion of the Authority or the Developer, an impasse has been reached in the negotiation or implementation of any material term or condition of this Agreement or the Contract; or (b) the Authority determines that its costs in performing under this Agreement well exceed $10,000 and the Developer does not deliver additional security to the Authority pursuant to Section 7; or (c) a party fails to perform any of it's obligations under this Agreement. If either party terminates the Agreement under this Section 8, the Developer shall remain liable to the Authority to the extent provided under Section 7 of this Agreement. 9. During the term of this Agreement, the Authority agrees that it will not negotiate or contract with any other party concerning the sale or development of the Property. The Developer shall not assign or transfer its rights under this Agreement in full or in part, or enter into any subcontracts to perform any of its obligations hereunder, without the prior written consent of the Authority. sJB-200895v2 4 MN 190-41 Q,~ ~~4 ~ c (c) Remedies. If the Redeveloper fails to meet the goals described in Section 3.8(a)(3), the Redeveloper shall repay to the Authority upon written demand from the Authority a "pro rata share" of the outstanding principal amount of the Interfund Loan together with interest on that amount at the implicit price deflator as defined in Minnesota Statutes, Section 275.50, subd. 2, accrued from the date of substantial completion of the Minimum Improvements to the date of payment. The term "pro rata share" means percentages calculated as follows: (i) if the failure relates to the number of jobs, the jobs required less the jobs created, divided by the jobs required; (ii) if the failure relates to wages, the number of jobs required less the number of jobs that meet the required wages, divided by the number of jobs required; (iii) if the failure relates to maintenance of the facility as a Qualified Facility in accordance with Section 3.8(a}(6), 60 less the number of months of operation as a Qualified Facility (where any month in which the Qualified Facility is in operation for at least 15 days constitutes a month of operation), commencing on the Benefit Date and ending with the date the Qualified Facility ceases operation as determined by the Authority Representative, divided by 60; and (iv) if more than one of clauses (i) through (iii) apply, the sum of the applicable percentages, not to exceed 100%. Nothing in this Section shall be construed to limit the Authority's remedies under Article IX hereof. In addition to the remedy described in this Section and any other remedy available to the Authority for failure to meet the goals stated in Section 3.8(a)(3), the Redeveloper agrees and understands that it may not a receive a business subsidy from the Authority or any grantor (as defined in the Business Subsidy Act) for a period of five years from the date of the failure or until the Redeveloper satisfies its repayment obligation under this Section, whichever occurs first. (d) Reports. The Redeveloper must submit to the Authority a written report regarding business subsidy goals and results by no later than February 1 of each year, commencing February 1, 2007 and continuing until the later of (i) the date the goals stated Section 3.8(a)(3} are met; (ii) 30 days after expiration of the period described in Section 3.8(a)(6); or (iii) if the goals are not met, the date the subsidy is repaid in accordance with Section 3.8(c). The report must comply with Section 116J.994, subdivision 7 of the Business Subsidy Act. The Authority will provide information to the Redeveloper regarding the required forms. If the Redeveloper fails to timely file any report required under this Section, the Authority will mail the Redeveloper a warning within one week after the required filing date. If, after 14 days of the postmarked date of the warning, the Redeveloper fails to provide a report, the Redeveloper must pay to the Authority a penalty of $100 for each subsequent day until the report is filed. The maximum aggregate penalty payable under this Section $1,000. Section 3.9. Payment of Administrative Costs. The Authority acknowledges that upon execution. of the Preliminary Agreement, Redeveloper has deposited with the Authority $10,000. The Authority will use such deposit to pay "Administrative Costs," which term means out of pocket costs incurred by the Authority and City together with staff costs of the Authority and City, all 28I415v5 MNT btNl90-123 12 attributable to or incurred in connection with the negotiation and preparation of the Preliminary Agreement, this Agreement, the TIF Plan, and other documents and agreements in connection with the development of the Redevelopment Property. At Redeveloper's request, but no more often than monthly, the Authority will provide Redeveloper with a written report including invoices, time sheets or other comparable evidence of expenditures for Administrative Costs and the outstanding balance of funds deposited. If at any time the Authority deternunes that the deposit is insufficient to pay Administrative Costs, the Redeveloper is obligated to pay such shortfall within 15 days after receipt of a written notice from the Authority containing evidence of the unpaid costs. If any balance of funds deposited remains upon issuance of the Certificate of Completion pursuant to Section 4.4 of this Agreement, the Authority shall promptly return such balance to Redeveloper; provided that Redeveloper remains obligated to pay subsequent Administrative Costs related to any amendments to this Agreement requested by Redeveloper. Upon termination of this Agreement in accordance with its terms, the Redeveloper remains obligated under this section. for Administrative Costs incurred through the effective date of termination. (The remainder of this page is intentionally left blank.) 281415v5 MNI MNl90-123 0 TIF Application Fees/Deposits. A. REFERENCE AND BACKGROUND: Staff was requested to research what other cities charge for TIF application fees and/or deposits. A list serve survey was e-mailed to approximately 500 members of the Government Finance Officer's Association, to which we received minimal response.. Of the Cities responding most charge either a deposit or a fee and some charge both. In addition most bill the applicant for costs above the deposit and/or fee. The attached spreadsheet is a summary of the responses received. In addition some cities included copies of their TIF application process including fees and deposit, which they are also attached. c m N O N w.~ ~O Q O ~ 0 5 _ y m C ~j ~ O +. N l0 E N ~ ~' '-n N > QZ .O ~ ~ (9 ° O C `~' fO O L V d1 N 'O ~ ~ C 7 .~ E °~ ~ o $ ` O. O N C N ~ ~ ~ d9 ~ O ~ C .~ ~ ~ ~ N ` O y ~ O O (0 ~ c N ~ N ~ ~ C O » t0 ° Q > c o v c ~ E' m • ~ _ o ~ ° ~p U O U ~ ~_ ~ •O. ° O N N ~ y ~ N O Rf C ~ 0 N 0 ` ~ U O N C y ~ ~ ~ ~; 7 Q ""O .O N ~ > 0 ° O ° .~ y ~ O O ~ ~ y $ O O m Y ~ ~ t0 O m G m >. f0 o O O ~ v Vi tJ4 a i - ~- ° ~ti fR o ° w ciy ` ~' . o o c c a~ ~ ~ a~ ° n ~ a > m *' v ~ ~ Q ~ ~ N .O "~ w y O O0 y ~yt y ~ ! `Vy > o c~ ~ $ O p y ca O q/~ U ,~ y p U U 0 ° N N N W ~ y N N p N `O~ O ~. E o y ~ O ~ ~ ~ ~ y y $ ~ ~ C ° y "-- $ ~ C E O ° ; { '" G O C c ~ O N O ~ E o O o •~ ~ o E -- o m ~° ~ 'E n ~ ~i °^ ~ °' E ~ ~° E m z° m ; m Q ~ O m ~ 'm a` 'aa m ~ 'm ~ ~ +, _ ~ 'b o 0 z o z N } o z N y o z 0 z 0 z 0 z o z y } o z 0 z 0 z 0 z ~, . - a~ 4 a a ~ - - O ~ 0 0 0 o O O O O p N C N C ~ C 0 ° O O O O y c O O p~ C 0 0 0 ~ ° c y N 0 o 0 Z 0 Z 0 Z 0 O 0 0 1n 0 O 0 O 0 0 O Z ° 0 Z 0 ~? 0 N 0 O ° ~ ~ M Oi ~ N c+i M u'i ~- u7 ui N u 7 p O D O Q N O ° N N m m ~ N O Q O ~ N N N N m . N w N ° ° C p C C C C ° C p p C C C C C D O d ° ° O ~n O Z O O O Z O Z O Z O Z O °- O Z O cn O O O Z O Z O Z O Z O Z ~ I- Q r fem. to ~ N ~ L ~ C L. '- ~ C Y _~ •~ IJ~ y 7 ~ C N ~ y O lU N to a O N N O O E O '~ N '~' a 2' N ° y ~G () m ~, y ~c E °o E ~ ° G Y ~ voi °' n. ~ w ° y U w m m m ti U ~ ~ O ~ ~ ~ ~n cg cA > ~ ~. ~~~ ./~~ ~" EDA Agenda - 04/09/08 8. New Business: F. Consideration to establish and approve a deposit amount and. fee range for the Preliminary Development Agreements. A. Reference and background:. The purpose of this exercise is to evaluate and improve the manner of which administrative costs are handled up-front with developers as these are sometime unforeseeable costs to developers (small business .owners.) CURRENT ADMINISTRATIVE EXPENDITURES: Ehlers & Associates -Flat. fee range established in 2006 and still applicable for creation of TIF District and modification of Central Monticello Redevelopment Project Plan No. 1. Economic District $8,000 to $10,000 Small Redevelopment District$10,000 to $15,000 Large Redevelopment District$13,000 to $19,000 Housing District $8,000 to $10,000 2008 Hourly rate - $160 per hour. ~~~,~c~o Kennedy & Graven -Please refer to EXHIBIT A. - letter referring. to legal services. Flat fees not the general practice of Kennedy & Graven. For Monticello Business Center (Otter Creek) - preparation of Purchase and Development Contract and preparation of land closing. For other economic, redevelopment, housing projects -preparation $f Redevelopment or o ec~ ~ 'a. ~ ~ c~ n a Development Contract. ~ ~ 2008 Hourly rate - Shareholder $200 per hour. Associate - $170 Paralegal - $120 Law Clerk - $115 At the workshop during review of the Preliminary Development Agreement it was noted to define what constitutes "administrative costs" which is essential to determine a deposit or fee range. 1 EDA Agenda - 04/09/08 CURRENT RECOVERY OF ADMINISTRATIVE EXPENDITURES: Deposit for Monticello Business Center (Otter Creek) $10,000. Shortfall billed at time of Certificate of Completion issued. Typical total administrative cost ranges between $15,000 to $17,500. Deposit for other economic or redevelopment projects $7,500. Shortfall billed at time of Certificate of Completion issued. Typical total administrative cost ranges between $5,500 and $7,500 between 2002-2005. The recommendation is to remain consistent with the two respective deposit amounts. The estimated costs for addendum letter can be determined bypast-history or by request for estimate from legal consultant. I review requesting legal estimates for each project as cumbersome and will only increase the legal consultant fees. St. Michael does not require a Preliminary Development Agreement or deposit and it depends upon the size of the project whether the developer is charged for the administrative costs. On small projects, they recover their Administrative Costs as an eligible expenditure of tax increment district. I will try and check with Big Lake. Our consultants indicate the majority of their clients charge the administrative costs to the developers. B. Supporting Data• Letter from Kennedy & Graven and draft of addendum letter. ~l Cl ~` 2~-- ~~~Jv ~~~ 2 Offices in 470 U.S. Bank Plaza 200 South Sixth Street Minneapolis 1Vlinneapolis, MN 55402 Saent Paul (612) 337-9300 telephone (612} 337-9310 fax SC. Cloud hap:/lwww.kennedy-graven.com -r~ ~,~.~ i Affirmative Action, Equal Opportuniry Employer STEPHEN J. BUBUL Attorney at Law Direct Dial (6l2) 337-9228 Email: sbubul(~kennedy-graven.com February 27, 2008 ILIA E-MAIL AND U.S. MAID Ollie Koropchak City of Monticello 505 Walnut Street, Suite 1 Monticello, Minnesota 55362-8822 RE: Legal Services Dear Ollie: You asked us to provide an updated proposal regarding our fees for legal services to the Monticello Economic Development Authority ("EDA"). As you know, we have provided services related to redevelopment and economic development for both the housing and redevelopment authority for many years. The services include drafting of development agreements, review and analysis of tax increment and other financing mechanisms, handling real estate transactions, preparing loan documents, and other similar work. We understand that the EDA will now handle all those transactions. Our current hourly rates for this type of work are $200 per hour for shareholders and $170 per hour for associates. Rates for paralegals are $120 per hour, and for law clerks $115 per hour. Our invoices also include usual and customary charges for copying, mileage and similar disbursements. These rates are effective for calendar year 2008, and would be subject to adjustment thereafter. You also asked whether we can provide a flat rate far development agreements. Unfortunately, that is not a practical option except in unusual circumstances. Unlike preparation of a tax increment plan, a development agreement varies with the nature of each transaction and the degree of negotiation with counsel for individual developers. It is very difficult to predict how involved those negotiations wrI1 be. Also, agreements that involve real estate transactions are different (and somewhat more complicated) than those that solely involve financial assistance. In real estate transactions, the work cannot he easily predicted because of many variables, including title and environmental conditions. 328471 v1 SJB MN190-101 Ollie Koropchak February 27, 2008 Page 2 of 2 ~'~ ~'~~ The only exception would be a circumstance where the EDA undertakes a series of virtually identical transactions, which have little opportunity for variation. If that situation arises, we could provide a flat fee for that series (which would be determined at that time based on the nature of the transaction.) If you or EDA commissioners have other questions, please let me know. Very truly ours, Stephen J. Bubul SJB 328471v1 S!B MN190-1.01 MONTICELLO Developer Address RE: Project Title Dear Date ~' As an addendum to the Preliminary Development Agreement, the City of Monticello Economic Development Authority (EDA) hereby provides administrative costs as defined in the Preliminary Development Agreement. Estimated financial consultant fees (Ehlers & Associates) Estimated legal consultant fees (Kennedy & Graven} TOTAL ESTIMATED ADMINISTRATIVE COSTS with an estimate of Please understand the above administrative costs are only estimates and subject to change upon completion of the actual work performed. As a point of reference, in the past few years the EDA has completed three development projects similar to yours. The administrative costs ranged between $15,000 to $18,000 for these projects. Payment of administrative costs shall be as follows: The Developer shall deliver a security payment (deposit) to the City of Monticello EDA in the form of cash or a certified check in the amount of $ ,such delivery shall occur upon execution of the Preliminary Development Agreement. If at any time or upon issuance of the Certificate of Completion identified within the Contract, the City of Monticello EDA determines that the deposit is insufficient to pay the Administrative Costs, the Developer is obligated to pay such shortfall within 15 days after receipt of a written notice from the EDA containing evidence of the unpaid costs. Monticello City Hall, 505 Walnut Street, Suite 1, Monticello, MN 55362-8831 • (763) 295-2711 • Fax (763) 295-4404 Office of Public Works, 909 Golf Course Rd., Monticello, MN 55362 • (763) 295-3170 • Fax (763) 271-3272 ,~ ~ If any balance of funds deposited remains upon issuance of the Certificate of Completion pursuant to the balance to the Developer. Contract, the EDA shall promptly return such Please do not hesitate to contact the Office of the City of Monticello EDA at 763-271-3208 if you have any questions. The City of Monticello is excited about your project and appreciates that has selected Monticello as the home for your business. Sincerely, CITY OF MONTICELLO ECONOMIC DEVELOPMENT AUTHORITY Executive Director c: Project File 2 EDA Agenda - 05/21/08 8. New Business: A. Consideration to apurove a Certificate of Completion (Minimum Improvements) associated with Porch Associates, LTD project. A. Reference and background: This agenda item is associated with the townhouse project known as Vine Place which was developed by Front Porch (Mike Cyr). The Private Development Contract is among the EDA, City and Front Porch and later assigned to First National Bank of Elk River. Upon completion and issuance of a Certificate of Occupancy by the Building Department for each townhouse within the Development Property and Adjacent Property, the Authority has issued a Certificate of Completion. It is anticipated the last townhouse within the Adjacent Property will receive its Certificate of Occupancy on Monday, May 12, 2008, and thereafter, the Executive Director will issue the Certificate of Completion within the required time frame of December 31, 2008. Upon completion of the 18 owner-occupied townhouses within the Development Property and completion of the 8owner-occupied townhouses within the Adjacent Property, a Certificate of Completion for the Minimum Improvements is issued by the Authority. "Minimum Improvements" within the Contract are defined as owner-occupied townhouses within the Development Property and Adjacent Property. In a meeting among city staff and the developer to finalize the project, it was noted by the developer due to the slow housing market and financing that the last two townhouses in the Adjacent Property were completed for the purpose as rental units. Although the City does have a Rental Ordinance and requires an annual rental license which Mr. Cyr has obtained for both units, the HRA approved the Housing TIF assistance for owner-occupied townhouses. Some of the property owners did appear before the City Council relative to concerns within Vine Place; however, construction complies with the City and State Building Codes. Under the Restriction of Uses -minimum improvements refers only to the Development Property which appears to be some inconsistency within the Contract. Clearly the Contract is between the EDA and the developer and not the neighbors. As an option the EDA may wish to preserve its right by waiving the Contract up to three years and requiring the developer to provide documentation of lease/purchase of the two rental townhouses. • 1 i a i 2 N N cd cn CO cn i-- � C° U 0 U cn cn U y V M O .y > O O P� cd PH Q Ig a� U Cd 'd O O + OCd Q cd N N N cdto U Cis O O u �� U A Cd J C",3 1-4 w w a o O •—+ N M � �n U (� U A U N "Developer" means Front Porch Associates, Ltd., a Minnesota corporation, or its permitted successors and assigns. "Development Property" means the property legally described at Exhibit A. After the construction of Townhouses thereon, the term shall mean the Development Property as improved. "Event of Default" means an action by the Developer listed in Article IX of this Agreement. "Holder" means the owner of a Mortgage. "Material" means any effect or change which significantly alters the intended use of the Development Property. "Minimum Improvements" means the construction on the Development Property of 18 owner-occupied Townhouses, plus the construction on the Adjacent Property of 8owner-occupied Townhouses, provided that each Townhouse shall consist of a minimum square footage of approximately 1320 square feet of main level living space, shall be located on a separate Parcel, and shall have an initial market value of at least approximately $148,000. "Mortgage" means any mortgage made by the Developer which is .secured, in whole or in part, with the Development Property or the Adjacent Property and which is a permitted encumbrance pursuant to the provisions of Article VIII of this Agreement. "Parcel" means any of the individually platted parcels on which a Townhouse is or is to be located. "Project" means Redevelopment Project No. 1. "Project Area" means the real property located within the boundaries of the Project. "Redevelopment Plan" means the Authority's Redevelopment Plan for Redevelopment Project No. 1, as it may be modified. "State" means the State of Minnesota. "Tax Increment" means that portion of the real property taxes which is paid with respect to the Development Property and which is remitted to the Authority as tax increment pursuant to the Tax Increment Act. "Tax Increment Act" or "TIF Act" means the Tax Increment Financing Act, Minnesota Statutes, Sections 469. l 74 to 469.179, as amended. "Tax Increment District" or "TIF District" means the proposed Tax Increment Financing District No. I -29. "Tax Increment Plan" or "TIF Plan" means the proposed tax increment financing plan for i~.rc-z i v ~ ~z~~ MN 196-97 3 EXHIBIT B CERTIFICATE OF COMPLETION (Minimum Improvements) The undersigned hereby certifies that Front Porch Associates, Ltd. (the "Developer") has frilly complied with its obligations under Articles III and IV of that document titled "Contract for Private Development," dated , 2002 among the City of Monticello, Minnesota, the Housing and RedevelopmentAuthority in and for the City of Monticello, Minnesota and the Developer, with respect to construction of the Minimum Improvements on the property described in Exhibit A thereto in accordance with the Construction Plans, and that the Developer is released and forever discharged from its obligations to construct of the Minimum Improvements under Articles III and IV. Dated: , 200_ HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF MONTICELLO, MINNESOTA By Its Chair By Its Executive Director STATE OF MINNESOTA ) SS. COUNTY OF WRIGHT ) The foregoing instrument was acknowledged before me this day of , 20 , by and ,the Chair and Executive Director of the Housing and Redevelopment Authority in and. for the City of Monticello, Minnesota, on behalf of the Authority. Notary Public THIS DOCUMENT DRAFTED BY: Kennedy & Graven, Chartered 470 Pillsbury Center 200 South Sixth Street Minneapolis, Minnesota 55402 (612} 337-9300 ~.ic-z i v i ,z.-; MN 190-97 B-I EXHIBIT A LEGAL DESCRIPTIONS CERTIFICATE OF COMPLETION (MINIMUM IMPROVEMENTS) That property located within the city of Monticello, Wright County, Minnesota and legally described as follows: NEED LEGAL HERE D1c;-~ i o i ~?~~~ MN 190-97 B-A-1 EDA Agenda - 05/21/08 8. New Business: B. Consideration of a motion acknowledging submission of Declaration of Potential Conflict of Interest. A. Reference and background. At the EDA workshop in April, the Executive Director informed the commissioners of a proposed EDA Conflict of Interest Bill in Legislation. Given the EDA Attorney felt it was highly unlikely the Bill would be approved by both Houses and signed into Law by the end of April, the EDA commissioners approved taking a wait and see approach prior to calling for a special EDA meeting of Apri130 to consider action on a potential Conflict of Interest. The proposed Conflict of Interest Bill actually provided the same option for EDA commissioners as that of HRA commissioners. The proposed Bill allows an EDA commissioner the option to submit a Declaration of Potential Conflict of Interest rather then resign as a commissioner. The Conflict of Interest applies to potential financial interest or gain. The penalty for violation is a regular misdemeanor. The Governor signed the Bill into Law effective April 17, 2008. William Tapper, a commissioner of the City of Monticello Economic Development Authority, hereby submits a Declaration of Potential Conflict of Interest and requests acknowledgment of the submission be entered into the minutes of the EDA. It is best for Tapper to leave the room and not participate in any way. Tapper is requesting an extension on the balloon payment associated with a GMEF Loan (next item). B. Alternative Action. 1. A motion acknowledging the submission of a Declaration of Potential Conflict of Interest from EDA Commissioner William Tapper hereby entering into the EDA minutes of May 21, 2008. 2. A motion to deny acknowledging submission of a Declaration of Potential Conflict of Interest from EDA Commissioner William Tapper. 3. A motion to table any action. C. Recommendation: Given Commissioner Tapper has submitted his request per the Minnesota Statutes, the Executive Director recommends Alternative No. 1. EDA Agenda - 05/21/08 D. Supporting Data. Copy of the Declaration executed by Commissioner Tapper. • J DECLARATION OF POTENTIAL CONFLICT OF INTEREST I, the undersigned commissioner of the City of Monticello Economic Development Authority (the "Authorit ") here by declare that: 1. I am / Lei of !~~° ~r• //~~ , a Minnesota o~C1/o.P~7o/~t 2. The Lo~~a,PA77~ r is or is reasonably likely to become a participant in a project or development that will be affected by decisions of the Authority and its board of commissioners. Specifically, the ~~Q~o,~ ,g-na .~ seeks to assistance or modification of assistance through Tax Increment Financing (TIF) or the Greater Monticello Enterprise Fund (GMEF) from the Authority in connection with construction of a manufacturing/office project in the City, which ' 1 require approval by the Authority for all related documents between the Authority and the S ~ 3. Pursuant to 2008 Minnesota Laws, Chapter 197 (to be codified at Minnesota Statutes, Section 469.098), I hereby submit this statement of potential c nflict of interest and request that it be entered in the minutes of the Authority at its meeting on , 20 oPi. 4. I will not attempt to influence any Authority employee in any matter related to the A~s manufacturing/office project, will not take part in any action or decision related to that matter, and will not be counted toward a quorum during the portion of any meeting of the Authority board of commissioners in which that matter is to be considered. Dated: ~ G ~, 20~ Commis er City of Monticello Economic Development Authority 331977 v l EDA Agenda - 05/21/08 8. New Busmess• C. Consideration to approve the request for an extension of the balloon payment date for GMEF Loan No. 021 (Tapper's, Inc.) A. Reference and background: William Tapper, President of Tappers, Inc., is requesting the EDA approve an extension of the balloon payment date for a minimum of one year for GMEF Loan No. 021. SEE EXHIBIT A. The EDA and Tapper's Inc. entered into a Loan Agreement on April 15, 2003. The $55,000 machinery & equipment loan was approved at 2.75% fixed interest rate amortized over ten years. The initial payment date for the principal and interest payment was May 1, 2003. The entire remaining unpaid balance ($29,784.22) of the principal and interest is due and payable on the first day of the sixtieth month following the initial payment date (May 1, 2008). Monthly principal and interest payments of $524.76 are current. According to the Greater Monticello Enterprise Fund (GMEF) Guidelines, DEFERRAL OF PAYMENTS, page 6, two requirements must be met for consideration to approve an extension of a balloon payment date. 1. Approval by the EDA membership by majority vote. 2. Extend the balloon if unable to refinance, verification letter from two lending institutions subject to Board approval. SEE EXHIBITS B. Given the Borrower has submitted two letters from lenders verifying its inability to obtain refinancing, consideration by the EDA of Mr. Tapper's request for extension of the balloon payment date for a minimum of one year is in order. B. Alternative Action: A motion to approve extending the balloon payment date for GMEF Loan No. 021 for Tapper's Inc. from May 1, 2008, to May 1, 2009. 2. A motion to approve extending the balloon payment date for GMEF Loan No. 021 for Tapper's Inc. from May 1, 2008, to 3. A motion to deny approval for extending the balloon payment date for GMEF Loan No. 021 for Tapper's Inc. 4. A motion to table any action. • M, A W U a� a� � U �w z N � aO U W., cl C o a! w P3.' � � w � Q 4- U �p C Cd O o O $ v� O y ojg!z 4) �Wa N � � O N N a ~~~a~~~~ April 30, 2008 EDA Monticello, MN 55362 Gentlemen: The purpose of this letter is to inform you that Tapper's Inc. has a balloon payment of approximately $30,000 due to the EDA on May 1, 2008. As you are aware Tapper's Inc.'s business activities are closely related to the new home industry and as you are also aware currently there is almost no new home building. The first quarter of this year has been much worse than expected in terms of sales, collections on model homes, foreclosures, and bankruptcies. To add to those problems our real-estate taxes which are also due in May are $14,000 higher than counties original estimate. Because of the current real-estate market and our poor financial performance our bank and three other banks we have talked to are not interested in loaning us the funds required to make the balloon payment to the EDA. I am asking that the EDA extend the balloon payment for a minimum of one year. This is allowed under the EDA Business Subsidy Criteria Deferral of Payments provision. I am attaching two banks letters of rejection as required I am requesting that the EDA consider my request for a loan extension. Sincerely, William R. Tapper FRANDSEN BANK & TRUST April O1, 2008 Tappers, Inc. Bill Tapper 212 Chelsea Road N[onticello, MN 55362 To William Tapper Sr.: ~.. ~~ [ have enclosed the information that you sent to Frandsen Bank and Trust for us to review. ~Ve have reviewed the information, and at this time we would like to see another fiscal year of operation before we would consider the loan request. If you would have any questions feel free to call me, or email me. ~Bes~t regards :` Vl~a Greeley Frandsen Bank and Trust Your Badge ro FB~ancia! Succeu Forest Lake Office 2001 West Broadway Forest Lake, MN 55025 Phone (691) 407-3300 Fax (651) 407-3305 www.frandsenbank.com