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City Council Minutes 07-27-1992MINUTES REGULAR MEETING - MONTICELLO CITY COUNCIL Monday, July 27, 1992 - 7 p.m. Members Present: Ken Maus, Shirley Anderson, Clint Herbst, Brad Fyle, Dan Blonigen Members Absent: None 2. Approval of minutes. After discussion, a motion was made by Brad Fyle and seconded by Shirley Anderson to approve the minutes of the regular meeting held July 13, 1992, as submitted. Motion carried unanimously. 3. Citizens comments/petitions, requests, and complaints. None forthcoming. 4. Consideration to review Greater Monticello Enterprise Fund Loan No. 004 (Suburban Machine & Manufacturing Inc.) for compliance with the GMEF Guidelines. Economic Development Director, 011ie Koropchak, reviewed the proposal in terms of the GMEF Guidelines and noted that the Economic Development Authority recommends that the proposed loan amount of $50,000 be granted to Suburban Machine & Manufacturing due to the finding by the EDA that the project meets the requirements of the loan guidelines. Shirley Anderson asked if employees in addition to those already on staff will be hired in conjunction with the new development. Brad Barger of Suburban Machine & Manufacturing stated that additional employees will be added and that he is currently advertising for employees in the local newspapers. After discussion, a motion was made by Shirley Anderson and seconded by Brad Fyle supporting the determination made by the• EDA that the proposed Loan No. 004 is consistent with the requirements noted in the Greater Monticello Enterprise Fund Guidelines; therefore, City Council supports the EDA loan approval to Bradley D. and Mary E. Barger, SMM. Motion carried unanimously. 5. Consideration to adopt Central Minnesota Initiative Fund Sponsoring Unit of Government Resolution on behalf of Suburban Machine & Manufacturing. 011ie Koropchak reported that the City Council is asked to consider the adoption of a sponsoring unit of government resolution on behalf of Suburban Machine & Manufacturing. Page 1 Council Minutes - 7/27/92 This resolution allows for Suburban Machine & Manufacturing to apply for funds through the Central Minnesota Initiative Fund Program. Koropchak reported that adoption of this resolution will satisfy the requirements of the 1987 Rural and Economic Development Act, will affirm that the City of Monticello has received a resolution request on behalf of Suburban Machine & Manufacturing, and that the Council supports the Suburban Machine & Manufacturing expansion project in Monticello. Koropchak also noted that the City of Monticello is not responsible for repayment of the $50,000 loan request. Brad Fyle asked if the Central Minnesota Initiative Fund does not approve the loan request of $50,000, where is the additional funding going to come from. Lenny Kirscht from Business Development Services stated that the developer would either have to provide additional equity into the project or a larger bank loan would need to be obtained. After discussion, a motion was made by Shirley Anderson and seconded by Dan Blonigen to adopt the Central Minnesota Initiative Fund Sponsoring Unit of Government Resolution on behalf of Suburban Machine & Manufacturing, Inc., Bradley D. and Mary E. Barger. Motion carried unanimously. SEE RESOLUTION 92-19. 6. _Consideration to adopt a resolution calling for a public hearing on the proposed modification of the Redevelopment Plan for Redevelopment Project No. 1, modification of Tax Increment Districts No. 1-1 through 1-13, and the adoption of the Tax Increment Financing TIF Plan for TIF District No. 1-14 (Suburban Machine & Manufacturing). 011ie Koropchak requested that City Council adopt a resolution calling for a public hearing on the Suburban Machine & Manufacturing TIF plan modification for August 10, 1992. Ken Maus noted that Council is only asked to call for the public hearing at this time. No action is requested. After discussion, a motion was made by Shirley Anderson and seconded by Dan Blonigen to adopt a resolution calling for said public hearing. Motion carried unanimously. SEE RESOLUTION 92-20. Page 2 Council Minutes - 7/27/92 7. Consideration of approval of preliminary plat of proposed Barger Addition. Assistant Administrator O'Neill reported that the Planning Commission has reviewed the preliminary plat of the Barger Addition at a special meeting immediately prior to the Council meeting and has recommended that the preliminary plat be approved. O'Neill noted that the preliminary plat is relatively simple in that it is a single block and single lot plat. O'Neill informed Council that a billboard is located at the site. According to the city ordinance, the billboard must be removed in conjunction with development of a structure at the site. Ken Maus recommended that City staff move quickly to determine if the City has the legal right to require that the sign be removed prior to issuance of a building permit. He was concerned that granting a building permit prior to removal of the sign could weaken the City's position when making ongoing attempts to have the sign removed. Brad Barger stated that he supports the removal of the sign, and he has informed the present owner, Agribank, that the sign will need to come down in conjunction with the development of the site. He was informed by Marty Vietoris of Agribank that removal of the sign will not be a problem. After discussion, a motion was made by Dan Blonigen and seconded by Clint Herbst to approve the preliminary plat of the Barger Addition as submitted. Motion carried unanimously. 8. Public hearing for the application of funding for the State of Minnesota for the Aroplax Corporation and consideration of adoption of the resolution of applicant, City of Monticello. Ken Maus opened the public hearing. 011ie Koropchak reviewed the funding program and noted that the Aroplax Corporation is requesting a grant from the Small Cities Economic Recovery Grant in the amount of $170,000. If the State approves the requested grant, the City will receive the $170,000 and, in turn, will loan the grant dollars to Aroplax Corporation at a 6% interest rate over 10 years. The grant is for manufacturing equipment. Koropchak explained that the City is not liable for the State dollars. The City has the right to retain the first $100,000 in principal and interest payback, while the State retains the remaining $70,000 principal and interest payback. Page 3 Council Minutes - 7/27/92 Koropchak went on to note that the project funding program has a $30,000 deficit due to the fact that the project did not receive funding from the Central Minnesota Initiative Fund. this gap in financing will need to be closed prior to submittal of the application and resolution to the State of Minnesota. Lenny Kirscht of Business Development Services stated that the project did not receive Central Minnesota Funding because the financial strength of the company did not justify the $30,000 commitment. Kirscht noted that the funding gap could be closed by obtaining additional equity from the developer by reducing equipment cost or by adding additional bank financing. Ken Maus noted that the development agreement has not been signed. It was his recommendation that the City adopt the resolution subject to the signing of the development agreement by Aroplax Corporation. After discussion, a motion was made by Brad Fyle and seconded by Dan Blonigen to adopt a resolution of applicant for Department of Trade and Economic Development Funding. Adoption of the resolution is subject to the completion and signing of the development agreement. Motion carried unanimously. SEE RESOLUTION 92-21. 9. Consideration to review GMEF Loan No. 005, Aroplax Corporation, for compliance with GMEF Guidelines and consider _authorizing transfer of $20,000 from liquor store fund to the GMEF account. 011ie Koropchak reviewed the Aroplax project in terms of the GMEF Policy Guidelines and noted that the Economic Development Authority recommends approval of the loan request in the amount of $85,000 due to the fact that the project meets the policy guidelines. She also requested that an additional $20,000 be allocated to the GMEF account to replenish the fund. The proposed loan request of $85,000 can be made only if the GMEF account is increased by $20,000. Council discussed the Aroplax project and reviewed alternatives for replenishment of the GMEF fund. Rick Wolfsteller noted that the UDAG grant is continuing to pay the City at the rate of $27,000 per year. There are funds available in the UDAG account that could be used to replenish the GMEF fund. Wolfsteller also noted that the public works facility funding demands will almost entirely deplete the liquor store fund. Page 4 Dan Blonigen suggested that utilized to replenish the GMEF in the event of cost overruns that there be additional funds cover cost overruns. Council Minutes - 7/27/92 the liquor store fund not be fund. It was his concern that with the public works facility in the liquor store account to After discussion, a motion was made by Clint Herbst and seconded by Brad Fyle to support the EDA loan request amount to Aroplax Corporation in the amount of $85,000 based on the finding that the Aroplax project and funding program meet the requirements of the Greater Monticello Enterprise Fund Policy Guidelines. Motion is to include authorization of a transfer of $20,000 from the UDAG account to the GMEF Revolving Loan account. Motion carried unanimously. 10. Consideration of approval of the development agreement governing terms and conditions associated with the development of the Battle Rapids townhome subdivision. Assistant Administrator O'Neill reviewed the proposed development agreement between the City and Investors Together governing terms and conditions associated with the development of the Battle Rapids townhome subdivision. O'Neill reported that the project will be completed in four phases. A letter of credit from the developer will be provided with the development of the first phase that will guarantee completion of the retaining wall and will guarantee tree planting and completion of all soil erosion control measures. O'Neill noted that the remaining tree planting associated with phases II, III, and IV will be completed simultaneous to development of the townhome structures with each phase. The agreement also requires that the storm sewer system be completed with phase III of the project. Finally, O'Neill stated that the City Attorney has requested additional time to make a few minor revisions to the document. Council discussion centered around the tree planting program. It was determined that the tree planting program as prepared is acceptable with the exception that phase IV tree planting may be modified to show evergreen plantings at alternative locations within that phase as determined by the developer. Ken Schwartz noted that the development constraints presented by the site with the change in elevations did not allow any of the original trees to be saved. The tree planting program does include planting of evergreen trees approximately every 27 feet along the front of the property, which will serve to enhance the site. Page 5 Council Minutes - 7/27/92 After discussion, it was the consensus of Council that the tree planting program strikes a balance between the needs of the future residents to view the river with the need to buffer the impact of the townhouse development on the river setting. After discussion, a motion was made by Brad Fyle and seconded by Shirley Anderson to approve the development agreement and direct staff to make final modification as directed by the City Attorney. Motion carried unanimously. 11. Consideration of approval of the final plat of the Battle Rapids subdivision. After discussion, motion was made by Brad Fyle and seconded by Shirley Anderson to approve the final plat of the Battle Rapids subdivision contingent upon execution of the development agreement. Motion carried unanimously. 12. Consideration of senior citizen center report and request for funding increase for 1993. Benjamin Withart, Senior Community Services Director, and Pam Loidolt, Senior Center Coordinator, were present to review the services provided to the Senior Center via the senior citizen's contract with Senior Community Services. As part of the presentation, the budget was reviewed and a request was made to increase city funding of the Center by 4%, which would provide funds necessary to increase the senior director staff support from 4 days a week to 5 days per week. In his presentation, Withart explained that his organization is a non-profit group. The additional contribution will go toward financing operational costs only. Dan Blonigen stated that the Senior Center should consider utilizing monies obtained through fundraising to pay for operational expenses. Clint Herbst explained that he supports the operation and service provided by the Senior Center. However, it is premature to increase Center funding at this time given the significant recent increase in funding. Shirley Anderson stated that the present operation should be continued without the need to start charging fees for use of the Senior Center. After discussion, a motion was made by Shirley Anderson to grant a 3% cost -of -living increase to support operation of the Senior Center. Motion died for lack of a second. Page 6 Council Minutes - 7/27/92 Ken Maus stated that the City Council does not want to give the wrong impression by denying the 3% increase. The record should show that no action was taken at this time to increase funding, yet the option is open for the Senior Center to request funding at a future date in the event alternative, supplemental funding sources can not be found. 13. Consideration of bills for the month of July. After discussion, seconded by Clint submitted. Motion Other matters: motion was made by Shirley Anderson and Herbst to approve payment of bills as carried unanimously. Roger Mack requested authorization to construct storage bins at the Public Works site. The bins are to be used for storage of compost, wood chips, and other materials that may be available to the public from time to time. Roger Mack noted that the bins would be screened with landscaped plantings and the opening to the bins would be oriented away from County Road 39. After discussion, a motion was made by Brad Fyle and seconded by Dan Blonigen to authorize construction of storage bins at an estimated cost of $2,000. Voting in favor: Ken Maus, Brad Fyle, Dan Blonigen, and Clint Herbst. Opposed: Shirley Anderson. There being no further discussion, the meeting was adjourned. ,( PI x, Jeff 'Neill Assistant Administrator Page 7