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EDA Minutes 08-18-2010Economic Development Authority Minutes 8/18/10 ECONOMIC DEVELOPMENT AUTHORITY (EDA) MEETING MINUTES Wednesday, August 18, 2010 6:00 p.m. Commissioners: President Bill Demeules, Vice President Dan Frie, Treasurer Bill Tapper, Bill Fair, Tracy Hinz, and Council members Tom Perrault and Brian Stumpf Staff: Executive Director Megan Barnett, Finance Director Tom Kelly Others: Sandy Suchy, Chamber Director 1. Call to Order President Bill Demeules called the meeting to order at 6:00 p.m. 2. Approve Meeting Minutes a. July 14, 2010 Regular EDA Meeting Minutes b. July 14, 2010 Joint EDA and City Council Meeting Minutes MOTION MADE BY STUMPF TO APPROVE THE JULY 14, 2010 REGULAR EDA MINUTES. MOTION WAS SECONDED BY TAPPER. MOTION CARRIED 7 -0. MOTION MADE BY FAIR TO APPROVE THE JULY 14, 2010 JOINT EDA AND CITY COUNCIL MINUTES. MOTION WAS SECONDED BY PERRAULT. MOTION CARRIED 7 -0. 3. Consideration of additional agenda items: None 4. Approval of EDA Invoices Barnett was pleased to report that she was able to sign up for an annual membership with CoreNct Global for only $100 more than the cost of attending the annual conference. MOTION WAS MADE BY FAIR TO APPROVE INVOICES. MOTION WAS SECONDED BY HINZ. MOTION CARRIED 7 -0. 5. Public Hearing: Consideration of entering into a Private Redevelopment Contract with Semper Development Ltd. Council recommended the EDA approve a final TIF spending plan for TIF District 1 -22 and Economic Development Authority Minutes 8/18/10 enter into a Private Redevelopment Contract with Scraper Development LTD. Kennedy and Graven determined that the EDA should hold a public hearing to comply with business subsidy laws which require a public hearing when funding more than $150,000 worth of subsidy. The EDA preliminarily approved a business subsidy in the amount of $389,000. Chairman Demeules opened the public hearing. Hearing no comments, the public hearing was closed. Tom Perrault pointed out that this involves money the EDA had already agreed to spend. MOTION MADE BY FAIR TO APPROVE ENTERING INTO A PRIVATE REDEVELOPMENT CONTRACT WITH SEMPER DEVELOPMENT, LTD. MOTION WAS SECONDED BY PERRAULT. MOTION CARRIED 7 -0. 6. Final EDA account balances Finance Director Tom Kelly submitted the audited balances of the tax increment districts within the City and the balance of the EDA fund through 2009. He indicated that the majority of TIF districts were set up as pay -as- you -go districts and are doing fine. TIF Districts 1 -36, 1 -37, and 1 -38 have not maintained their value. These districts were provided with upfront assistance in the form of reduced land acquisition costs. The tax rate at the time of sale was projected to be higher than it actually turned out to be. The EDA sold the land at a price below market value and, as the increment comes in from the district, the EDA is paid back for the discounted land price. The increment generated from these districts will not recoup the land costs. There was some discussion about this shortfall. There were questions about how the EDA pays itself back for transactions. Tapper asked for clarification about a $1.3 million dollar land deal in which EDA general funds were used but paid back into a fund that had nothing to do with the project. Tom Kelly confirmed that it had been an error and that the money had been moved back into the proper fund. He also indicated that Finance staff may have to make further adjustments to correct any other fund issues. He noted that the EDA does have the $1.3 million to spend and that the auditors did not find anything wrong when reviewing fund transfers. MOTION BY TAPPER TO ACCEPT THE 2009 FUND BALANCE REPORT. MOTION WAS SECONDED BY STUMPF. MOTION CARRIED 7 -0. 7. Proposed funding schedule for the Embracing Downtown Study The EDA and City Council had approved moving forward with an Embracing Downtown Study with the condition that staff research viable funding options. The EDA had previously approved spending $128,000 in TIF 1 -2 funds for this project. This Economic Development Authority Minutes 8/18/10 proposal requests an additional $32,000 in funds from TIF 1 -2. There was discussion about various options for the use of those funds. Barnett pointed out that it would be difficult to purchase property by December and that TIF District 1 -2 would expire by the end of the year. She recommended utilizing the remaining funds at this time. hi addition, she pointed out that funds would still be available to purchase property in TIF Districts 5 & 6 and potentially 1 -22 (after decertifying) should the EDA choose to do so. There was discussion about funding the remaining study cost through the General Fund. Barnett noted that staff would research applying for any available grants in an effort to reduce General Fund expenses. MOTION BY FAIR TO APPROVE UTILIZING $160,000 OF SURPLUS TIF FROM DISTRICT 1 -2 CONTINGENT UPON THE CITY COUNCIL ALLOCATING $77,695 IN THE 2011 GENERAL FUND BUDGET TO FUND THE EMBRACING DOWNTOWN STUDY. MOTION SECONDED BY STUMPF. MOTION CARRIED 6 -1. PERRAULT VOTED IN OPPOSITION. 8. Consideration of initiating and funding a Leadership & Management Training Course through North Hennepin Technical College targeted for existing Monticello Businesses Barnett noted that the results of the BR &E survey indicated an interest in providing local leadership and management training to businesses within the city. She pointed out that it is critical to a community's economic stability that business retention initiatives are made available and indicated that many localities already do this quite successfully. She indicated that the IEDC is in support of this effort but doesn't have funds to contribute. hi order to make the program more affordable to the business community, city staff asked the EDA to subsidize $320 of the $800 registration fee per participant. Staff plan to incorporate a Business Retention Education line item and request that this become a regular budgeted program. Barnett introduced Jamie Simonsen from North Hennepin Technical College who summarized the L.E.A.D program designed to address key topics identified as important to the Monticello business community. Jamie outlined a monthly course offered in four hour workshops held from October through May during which businesses would learn skills to put to use within their organization. She noted that business core partners would pay $495 for registration and others in the organization might attend for certain sessions for a reduced rate. Classes would require a minimum of 10 and a maximum of 20 participants. Barnett noted that the training could be advertised through the Chamber, through e- newsletters and by direct mail to every business. Perrault questioned the value of having another program subsidized by the government. Barnett noted that businesses are provided incentives to move to Monticello but that little effort has been directed to supporting the business effort to success in the community. Tapper suggested Economic Development Authority Minutes 8/18/10 that the EDA see this as a pilot project and that they take a hard look at the goal of business retention. Barnett noted that there is currently a balance of $11,000 in the EDA's Professional Services funds. Hinz suggested that perhaps the EDA would consider, at some point, making a grant award to a non -profit organization that could use some leadership training. Perrault suggested that North Hennepin consider working with Community Ed to offer Microsoft training. MOTION WAS MADE BY FRIE TO APPROVE SUBSIDIZING UP TO THE BUDGETED AMOUNT FOR PROFESSIONAL SERVICES ($11,000) FOR REGISTRATION FEES FOR EXISITNG MONTICELLO BUSINESSES TO PARTICIPATE IN A L.E.A.D. PROGRAM INSTRUCTED BY NORTH HENNEPIN COMMUNITY COLLEGE. THE PROGRAM IS TO BE REVIEWED BY THE EDA NEXT YEAR. MOTION SECONDED BY FAIR. MOTION CARRIED 7 -0. 9. Initiate an Industry of the Year Award and Recognition Event Barnett proposed formalizing an annual Industry of the Year Award to recognize the value of industry within the City. The IEDC supports creating an award and requested the financial support of the EDA in this effort. Barnett included a draft outline to establish a method to recognize an industry every year. Staff also discussed initiating an event in October targeted to the Monticello industries to mark Manufacturing Month. The EDA agreed that the City, the IEDC and the Chamber would do a breakfast spotlight. Barnett specified that the IEDC would be the voice for industry in nominating and making the selection but that the decision would be ratified by the EDA. There was some discussion about doing business spotlights in the future. It was recommended that the IEDC provide broad publicity in announcing the award. Perrault indicated that he feels that businesses should be recognized as well but agreed that it is a start. MOTION WAS MADE BY FAIR TO APPROVE A PROCESS AND CRITERIA ESTABLISHING AN INDUSTRY OF THE YEAR AWARD AND RECOGNITION EVENT WITH AN APPROXIMATE BUDGET OF $400 TO COVER FOOD, AWARD AND INVITATION COSTS. MOTION WAS SECONDED BY TAPPER. MOTION CARRIED 7 -0. 10. Marketing Update: There was no update provided. 11. Director Report Barnett noted that $ there are two shovel ready proposals including a 25 acre 300,000 square foot medical distribution center in the works. Economic Development Authority Minutes 8/18/10 12. Adjournment MOTION WAS MADE BY TAPPER TO ADJOURN. MOTION WAS SECONDED BY FAIR. MOTION CARRIED 7 -0. The meeting adjourned at 7:27 p.m. The EDA proceeded into closed session to discuss land acquisition. Recorder: Kerry T. Burri —/6z Approved: October 13, 2010 EDA Meeting Bill Demeules, President