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EDA Minutes 03-11-2009MINUTES CITY OF MONTICELLO ECONOMIC DEVELOPMENT AUTHORITY Wednesday, March 11, 2009 6:00pm 1. Call to Order: Chairman Demeules called the meeting to order and declared a quorum at 6:00pm. Roll Call: The following Cormnissioners were present: Chair Bill Demeules Vice President Dan Frie Corrunissioner Bill Fair Cormnissioner Bob Viering Council Member Brian Stumpf Council Member Tom Perrault Absent: Corornissioner Bill Tapper Also present Executive Director Megan Barnett 2. Approve minutes: MOTION BY FAIR TO APPROVE MINUTES WITH CORRECTIONS TO THE VOTES SECONDED BY FRIE. MOTION CARRIED. 6 -0 3. Consideration of additional agenda items: Staff requested discussion regarding EDA members volunteering on the Higher Education Committee and lenders/realtors group. Commissioner Perrault stated he would like to discuss the MN Homeownership monthly telephone seminar on Foreclosures. 4. Approval of EDA invoices: MOTION BY VIERLING TO APPROVE EDA INVOICES INCLUDING THE MONTICELLO TIMES INVOICE SECONDED BY FAIR. MOTION CARRIED. 6 -0. 5. Public Hearing and adoption of Resolution No. 2009 -01 establishing a Business Subsidy Policy. Director Barnett stated the Business Subsidy Criteria presented tonight is the document that was presented and discussed at the February EDA workshop. Chair Demeules opened the public hearing. There was no public comment. The public hearing was closed. MOTION BY FAIR TO APPROVE THE BUSINESS SUBSIDY CRITERIA SECONDED BY VIERLING. MOTION CARRIED. 6 -0. Commissioner Viering questioned if the EDA and City has the authority to issue business subsidy for working capital purposes. Director Barnett stated Kennedy and Graven provided clear legal opinion on this topic. EDA's do have statutory authority to issue loans for working capital. Furthermore, it is questionable if City Councils can issue loans for this purpose. 6. Recommend the City Council approve the adoption of Business Subsidy Criteria related to: Tax Increment Financing, Greater Monticello Enterprise Fund, and Monticello Small cities Economic Development Set -aside Revolving Loan Fund: Tax Increment Financing (TIF): Director Barnett handed out a grammar and sentence structure revised GMEF criteria. Director Barnett stated City Staff and Martha Ingram from Kennedy and Graven made minor sentence clarification changes as directed by the EDA during the workshop. MOTION BY STUMPF TO APPROVE BUSINESS SUBSIDY CRITERIA RELATED TO TAX INCREMENT FINANCING SECONDED BY PERRAULT. MOTION CARRIED. 6- 0. Greater Monticello Enterprise Fund (GMEF) Director Barnett stated changes were made to the Greater Monticello Enterprise Fund criteria as directed by the EDA during the February workshop. Staff met with Council Member Perrault to review a few additional sentence clarifications. Under Loan Application Procedures, b , #5 the sentence is being proposed to include the word "action" instead of approval. Corn missioner Fair stated the word "issued" should be changed to say "approved or denied." The EDA generally agreed to this modification. MOTION BY FAIR TO APPROVE THE GREATER MONTICELLO ENTERIPSE FUND GUIDELINES AS MODIFIED SECONDED PERRAULT. MOTION CARRIED. 6 -0. Perrault stated a period needed to be inserted between "viable" and "city." Monticello Small Cities Economic Development Set -Aside Fund Guidelines. Director Barnett stated changes were made to clarify the fact that the City Council is the governing body of these funds until the funds are paid back into the GMEF. At this time the EDA becomes the governing body. Barnett also stated a few additional modifications were changed throughout the document to clarify that "city" means "city council." Chair Demeules questioned if the EDA is a reviewing body of the application. Barnett stated the guidelines are not set up to have the EDA review applications, however this would be an appropriate step. Cormnissioner Fair stated he did not see the need for the EDA to review these applications. Commissioner Viering stated he would rather see the applications come through the EDA. The consensus of the EDA was to include language under the process section stating the EDA will review the applications and provide a recommendation to the City Council. MOTION BY FAIR TO APPROVE THE MONTICELLO SMALL CITIES ECONOMIC DEVELOPMENT FUND AS AMENDED SECOND BY FRIE. MOTION CARRIED. 6 -0, Commissioner Fair questioned how staff plans to market the availability of these funds. Staff stated every intention will be made to market this loan program through network meetings and the business newsletter (Business Insider). 7. Recommend the City enter a Listing Agreement with Nelson Realty: Director Barnett reviewed the staff report and stated the positive reasons why the City should list city owned land with a commercial broker and more specifically, Nelson Realty. Barnett stated she did contact four firms and they stated they were not interested in listing Monticello owned land at this point. Barnett stated Andy Larson with Nelson Realty has stepped up to the plate and worked with staff on creating a listing agreement that is flexible yet fair to both parties. She stated a few changes are being proposed, change the land price from $3.00 to $2.75 /square foot and remove "before economic incentives are applied" under #7 Compensation of Agent. Commissioner Frie asked how Monticello's land price compared with surroundings cities. Andy Nelson realty stated prices range from $6.00 to $2.00 per square foot. Commissioner Viering stated a minimum compensation should be included. This relates to situations where the City decides to sell the land for zero dollars, the commercial broker should still have an incentive to bring the city a potential buyer. Director Barnett stated she would work with Andy on including a transaction fee. Council Member Stumpf asked how we assure that property is not sold on speculation and held for years. Barnett stated that the timeline desired for development can be built into the purchase agreement. Commissioner Viering asked what would happen in situations where inquiries came through the City and not through Nelson Realty. Director Barnett stated tracking this type of accountability would be difficult. A standard listing agreement gives the commercial broker exclusive rights to market the property and handle all inquiries. Commissioner Viering asked Andy Larson to provide a summary as to why the City should list with Nelson Realty. Mr. Larson stated that they have good networks and a good understanding of the community. Mr. Larson also stated they focus on the Wright County area. Director Barnett stated that based on the networks and associations Nelson and the City are involved in, it appears that a partnership between Nelson and the City will be a good fit. MOTION BY VIERING TO ENTER INTO A LISTING AGREEMENT WITH NELSON REALTY BASED ON REDUCING THE LAND PRICE TO $2.75 AND INSERTING A TRANSACTION FEE SECONDED BY FRIE. MOTION CARRIED. 6 -0. Council member Perrault questioned whether we should solicit additional commercial brokers, like Coldwell Banker who may have the potential for a bigger network. Commissioner Frie stated he has asked the same question over the years and has come to realize the bigger firms are just not interested in corning to this area. These companies have been asked several times in the past and they just do not have interest. It is not in the best interest of the City to list with someone that is not enthusiastic to market Monticello. 8. Consideration of additional items: Director Barnett asked for a volunteer fi-om the EDA to serve on the Higher Education Committee. Commissioner Frie stated he would serve on the Higher Education Committee and Commissioner Viering stated he would be willing to replace Commissioner Frie on the Marketing Committee. Director Barnett updated the EDA regarding the current marketing efforts. Director Barnett informed the EDA that the City was awarded the Neighborhood Stabilization Grant. It is anticipated that the required contract will be signed in April. After the contract is signed, the City and CMHP will aggressively market these available funds. Director Barnett also updated the EDA on the local group of lenders /realtors/WCCA/fitle companies that meet on a regular basis to try to generate ideas and venues to promote foreclosure prevention events and information. Director Barnett asked if any commissioner would like to attend these meetings. Commissioner Fair stated he would attend with advance notice and Commissioner Frie stated he would be a back -up. Commissioner Viering passed out information regarding the Cities that we were awarded the NSP grant. MOTION BY DEMULUES TO ADJORN SECONDED BY FAIR. MOTION CARRIED. 6 -0 ADJORN 7:15pm 1000 V1 1 AaNPA 9