EDA Agenda 07-25-1995AGENDA
MONTICELLO ECONOMIC ORVF.t,OPMF.NT AUTHORITY
Tuesday, July 25, 1995 - 7:00 P.M.
City Hall
MEMBERS: Chairperson Ron Hoglund, Vice Chairperson Barb
Schwientek, Assistant Treasurer Harvey Kendall, Clint
Herbst, Tom Perrault, Al Larson, and Bill Demcules.
STAFF: Treasurer Rick Wolfsteller
Executive Director 011ie Koropchak.
GUEST: Steve_ Lemme and John Babcock, H -Window Company.
1. CALL TO ORDER.
2. CONSIDERATION TO APPROVE THE MARCH 7, 1995, EDA MINUTES.
3. CONSIDERATION TO REVIEW FOR APPROVAL THE SECOND PRELIMINARY
AND FINAL GMEF APPLICATION FROM APPLICANT. THE H -WINDOW
COMPANY.
4. CONSIDERATION TO APPROVE. OR DISAPPROVE GMEF LOAN NO. 009 FOR
THE H --WINDOW COMPANY.
+ g. CONSIDERATION TO DISCUSS THE EDA BUDGET AND LIQUOR FUNn
APPROPRIATION FOR RECOMMENDATION IN PRF,PARATION OF THP CITY
1996 BIIDGET.
6. CONSIDERATION TO AMEND THE GMEF GUIDELINE PROVISION: LOAN
SIZE.
7. OTHER BUSINESS.
S. An.70URNMPNT .
MINUTES
MONTICELLO ECONOMIC DEVELOPMENT AUTHORITY
Tuesday, March T, 1995 - 7:00 p.m.
City Hall
MEMBERS PRESENT: Chairperson Ron Hoglund, Vice Chairperson Barb
Schwientek, Tom Perrault, Al Larson, and
Harvey Kendall.
MEMBERS ABSENT: Clint Herbst.
STAFF PRESENT: EDA Treasurer Rick Wolfsteller and Executive
Director 011ie Koropchek.
1. CALL TO ORDER.
Chairperson Hoglund called the EDA meeting to order at 7:00
p.m.
2. INTERVIEW OF CANDIDATES FOR COMMISSIONER OF THE EDA.
Morrill Busch withdrew his.application for commissioner of the
EDA because of increased demands within his employment. EDA
members interviewed William Demeules and John Duffy for the
commission seat vacated by Bob Mooford. Following a line of
prepared questions and discussion-, the EDA Commissioners
agreed to recommend to the City Council the name of William
"Bill" Demeulea for appointment to the BDA. The five-year
term will expire in December, 2000. Reasons for the
recommendation were: Resident of the City of Monticello, co-
owner of local business, expertise of running a buoine3s;
Industrial preceptiveness, experienced EDA process first-hand,
supports business retention and expansion, interested in
community involvement, and creates an opportunity for
Industrial prospect leads through Demeule'o network. Although
Mr. Dcmeulos was recommended, the EDA felt both individuals
would serve the commission well and requested Mr. Duffy be
encouraged to resubmit his application for other commission
vacancies. His Qualities may better be served on another
commission.
3. CONSIDERATION TO.APPROVE_THEJUNE_16,_1904 EDA_MINUTES.�
Barb Schwientek made a motion to approve the June 10, 1004 EDA
minutes. With no other EDA members in attendance at the June
18 meeting, no second to the motion was heard. With no
corrections or additions, the minutes were filed as approved.
4. CONSIDERATION TO DISCUSS FOR A RECOMMENDATION TO CITY COUNCIL
THE APPOINTMENT OF AN EDA COMMISSIONER.
Considered under Stam • 2.
EDA MINUTES
MARCH 7, 1995
5. CONSIDERATION TO ELECT 1995 EDA OFFICERS.
Barb Schwientek made a motion to nominate and to approve the
following individuals as 1995 officers of the EDA.
President - Ron Hoglund
Vice President - Barb Schwientek
Treasurer - Rick Wolfsteller
Assistant Treasurer - Harvey Kendall
Secretary - 011ie Koropchak
Al Larson seconded the motion and with no further discussion,
the motion was approved unanimously.
Koropchak also remains the Executive Director of the EDA.
6. CONSIDERATION TO REVIEW AND ACCEPT THE YEAR-END EDA FINANCIAL
STATEMENTS, ACTIVITY REPORT, AND PROPOSED 1995 BUDGET.
Koropchak reviewed the process for development of the year-end
statements beginning with the statement of revonues and
expenditures. Under revenues, no revenues were transferred
from the Liquor or UDAG Funds to the EDA and revenues received
(I were the Muller $50.000 loan prepayment; interest income on
Bks. notes and eotimatod interest income on investments; loan fee
from Standard Iron closing; and miscellaneous revenues from
administration and service of the State and CMIF Grants to
Wright County for Standard Iron. Under expenditures, legal
fees were for closing documents associated with the prepayment
of the Muller Loan and service fees include fees paid by tho
EDA to Marquette Bank for oorvico of the Tapper and Muller
loans. EDA rovonues for 1994 were $73,061.53 and with the
addition of the 1994 beginning balance of $636,816.08, the
1994 year-end balance is $709,875.61.
The balance sheet ohowod Equity Fund and Asset balances of
$709,875.61 each. With an appropriation total of $200,000 and
the principal baloneea of existing GMEF loans, the EDA cash in
bank is 5209.584.73. Duo to year-end adjustments necessary
for the estimated intoreot income - investment, a small gap
exist between EDA atatcmonto and City accounts. The $75,000
gap of loot year regarding the difforonco between the EDA
approved and City disbursed monies for the Standard Iron loan.
corrected itoolf.
The EDA 1995 cash flow projection or budget begins with tho
5209,584.73 cash balance. Anticipated rovonuoo include
appropriations from tho Liquor Fund, UDAG, and ERG-Aroplax of
Pago 2
EDA MINUTES
MARCH 7, 1995
$200,000; principal and interest from existing GMEF loans; and
estimated dollars for interest income - investment, loan fees,
and miscellaneous. Anticipated expenditures include two BRE
loans to the H -Window and Generoux at $50,000 each, $100,000
for new industries, and legal and service fees. Expected cash
balance of December 1995 ie projected at $255,288.43.
Also, included was a summary of EDA activities for 1994.
Harvey Kendall made a motion to accept the 1994 end -year EDA
financial statements, activity report, and proposed 1995
budget as prepared. Al Larson seconded the motion and with no
further discussion, the motion passed unanimously. Said
reports to be submitted to the City Council on March 13, 1995.
7. CONSIDERATION TO REVIEW YEAR-END BALANCES OF THE GMEF, UDAG,
AND ERG FUNDS.
All loan payback payments for the GMEF, UDAG - FSI, ERG -
Aroplax and Standard Iron, and CMIF - Standard Iron Funds are
current.
Of the original GMEF loans, the total of the principals Is
$390,500.00. Principal amounts of $90,209.12 and interest
amounts of 662,073.66 were received in 1994 for a total
principal balance• due of $300,290.88.
Of the original UDAG - FSI loan, the principal and interest
was $335,656.80. $198,130.75 has been received for a
principal and interest balance due of 8137,526.05. This 12 -
year loan ends January, 2000. The 1994 year-end UDAG balance
available for use by the EDA is $203,043.20 which Includes
Interest income - investment.
Of the original ERO - Aroplax loan, the principal and interest
was $207,969.92. 852,086.35 has been received for a principal
and interest balance due of $148,883.57. This 7 -year loan
ends November, 1999. The 1994 year-end ERG balance available
for use by the EDA is $64,404.27 which includes interest
Income - investment. Under State policy, the EDA is allowed
to retain the first 8123,912.94 principal and interest.
Of the original SR0 - Standard Iron - Wright County loan, the
principal was $1.50,000. $19.428.57 principal and interest has
been received on the 7 -year loan ending June, 2001.
Page 3
EDA MINUTES
MARCH 7, 1995
Of the original CMIF - Standard Iron loan, the principal was
$100,000. $7,771.47 principal and interest has been received
on the 7 -year loan ending June, 2001.
City staff is hopeful the $250,000 (M&E) State -Federal Grant
to the City of Monticello for the H -Window expansion will soon
close.
In summary, Horopchak reported, the combined year-end balances
available for use by the EDA in 1995 total $377,032.20;
however, annual appropriations total $200,000. In addition,
the EDA requested a 1995 Liquor Fund Appropriation of $100,000
from the City.
The EDA agreed that the GMBF is meeting one of its original
objectives: To become a self-perpetuating fund.
8. CONSIDERATION OF AN UPDATE ON GMEF LOAN NO. 008 FOR THE H -
WINDOW COMPANY.
The EDA accepted the update so written.
9. Other Business:
a) Tapper-* Inc. expansion - The EDA did not make any
conclusive decision regarding prepayment of the first
GMEF-Tapper Loan prior to disbursement of a second loan.
The EDA supports the use of the GMEF for business
expansion and retention.
10. ADJOURNMENT.
The EDA meeting adjourned at 9:30 p.m.
Q �u h �r,
011ie Koropchak, Executive Director
Page 4
EDA AGENDA
JULY 25, 1995
3. Consideration to review for nonroval the srcond preliminary
and final GMEF application from applicant. the H -Window
Comnnnv.
A. Reference and Backqround:
As prepared for Loan No. 008 approval on June 15, 1994 and
March 7, 1995, Update.
GMEF LOAN APPLICATION REQUEST:
$50,000 for equipment, 5.0% interest rato over 10 yvaro,
shared firAt-position with the SCREG.
USES OF FUNDS
Equipment, $350,000
TOTAL USES OF FUNDS $350,000
SOURCES nF FUNDS
State of Minnesota, SCERG $280,000
1 (0%-5%' 10 yearn, Shared let/equipment.)
GMEF 0 50,000
(5k, 10 years, shared 1st/equipment)
Equity $ 501000
TOTAL SOURCES OF FUNDS 3340.000
rRRATER MONTICELLO ENTERPRISE FUND (GMEFI 011IDELiNE9
BOLD to update for GMER No. 009 Lnan approval.
PUBLIC PURPOSE CRITERIA. Must comply with four or mora of, the
criteria 1.1sted below,, criteria Ri
being mandatory.
I. Creates new Jobe; 48 new (37.8 hpw) Joha aver two
years. currently 30 full-time.
40 new (37.0 hW) Jobs over two
years. Currently 60 tull-tins.
G
Pagr 1
EDA AGENDA
JULY 25, 1996
2. Increases the community tax baso: Estimated Market
Value of the
expansion is
$ 6 9 1, 6 0 0 o r
estimated Tax
Capacity of $30,213.
ESTIMATED 11ARMT VALUE - PAYABLE 1995 I$
$1,426,000 OR TAE cAPACITY OF 563,996 FOR
LOT 12.
3. Factors: Will assist an existing industrial business to
expand their oporatione. The business and
completed real estate project was compatible
with the comprehensive plan and existing
zoning policies. The company's product is
unique and no potential adverse environmental
offoct.e are anticipated.
a. Used as a secondary source of supplement conventional
financing: Although bank financing Is not part, of
the $350,000 equipment package, Of the
$11R001000 total package (Including the
Line of Credit) Christiania Rank (New
46. York) financed 38.81t or $700,000.
5. Used as gap financing; With the $CERO and TIP
redur,tion and the CMTF denial,
a "gap" in the finiinr,ial
package became apparent. Thr_
OMRF is 2.7% of tht, tonal
$1,000,000 package.
6. Ueed to seelet other funds: state Funds ore being
requested and Regional
Fundy were denied. 0.0.
Bonds wore dcniod and TIP
assistants reduced.
"R ATM MONTIORAND PO[•ICI'S
T. BUSINERS ELTOIRTLTTYi
TndkiNtrial business; yen.
Located within city limits: Yes, Zoned T-2.
Lotm 11 mind 12. Block 2,
nip
Page 2
EDA AGENDA
JULY 25, 1995
Credit worthy exit+tiny buolness: Yes, real estate
finanring approved
with Chrietianla
Batik, positive
credit anal.ynis by
PRG and CMIF.
SHE FINANCIAL ANALYSIS BY PRO
(FINANCIAL STATEKENTS MING
JUNE 90, 1995.)
$10,000 loan per each job created, $5,000 per every
$20,000 in property market valuation, or $5,000 per every
$20,000 increase in personal property used for businei,s
purpose, whichever highest: $450,000 ($400,000).
$172,900, or $87,500 respectively.
EDA Approval: $60,000 GMEF loan.
II. FINANCING MP,THOD:
Participation Loan: The State and CMEP will share a
first positionnn the equipment.
(�- III. USE OF PROCEP,DS:
Equipment - See enolosed.liot.
IV. TP.RMS AND CONDITIONS:
I,nun 4lzc:
Maximum not to exceed 5016 of tho
r,omaining GMEF balance. Balanco January
111041 8200,000. Appropriation balance
January 1995, $200,000. Maximum Loan
Alze, $100,000.
EDA Approval:
$50,000 GMEF loan.
Ltivflraglnq:
Minimum 60% privete/puhllr, non-OMEF.
Maximum 10% nMP,F. Minimum 10% equity of
nMEF loan.
TnTAL PRnJECT
Bank $700,00n (1$.A6%)
EQUITY $M00,000 (44.44%)
1TATF $2501000 (111.$$%)
OMEF $ 50,000 ( 2.77%)
11 EDA AGENDA
my 25, 199.9
Collateral: Mortgage deeds, securities, and/or
guarantees as per the GMEF attorney.
Non-performance: The approved GMEF loan shall be null
and void if funds are not drawn upon
or disbursed with 180 days from date
of EDA approval.
EDA Approval: Null and void date, December 15, 1994.
Extended to January 15, 1995 by vote of
the EDA Comlesioners. Became null and
void on January 15, 1995.
GMEF legal fees: Responsibility of thr_ GMEF
applicant.
B. Recnmmondation:
Recommendation is to review thr, enc]oat�d information prinr to
the EDA meeting for discusolon and potential questionG.
Coneidoration to approve GMEF Is the next agenda .item.
C.
RnnnnYtinn Drta;
1.
Copy of the oecnnd preliminary GME® application.
2.
Equipment list.
3.
Updated financial analysis.
4.
Copy of original GMEF Loan approval.
A.
ropy of the March 7. 1995, EDA Agenda Update relating to
the H --Window.
6.
Copy of the State's revi9cd terms and conditions.
Supporting Date On -hand:
1.
State Economic Recovery Grant Appllcwtion.
2
CMIP Application and denial letter.
3.
private Redevelopmrnt Contract between the H --W wlow
Company and tit" HRA.
4.
UpAated Financia] Statements.
5.
Company Executive Rummary:
GSFA"'_i MON:'ICELLO ENTERPRISE
250 EAST BROADWAY
MONTICMLO, MINNESOTA
' PR=ZJStmma Apeac _'ICN FOR LOAN
APPLICAC: The H Window Company
PI:1M OR '"RADE NAME: The H Window -
BUSINESS ADDRESS: 1374 E. Oakwood Drive, Monticello, MN »>oc
li 6 Stzeet) (C:.ty 5 State) (Zip Coce)
TELc'PEONE: BUSINESS kll ?Qi -5305 ELME ( )
DATE ESTABLI53ID: 14R7 EMMOY"M I.D. 3873080
SOLE PROPRIETOR x CORPORATION _ PAMNER.SHM
NAME TITLE OWNERSSIP t
"rtran [amm President / General Manager ----
G„illra Tnternat�u�.vet bf%
�rv,rr,an a /c L.i9S
-EJr rAlnne*.ari A/S lux
PROJEC LOC-nCN: H Window Factory Monticello, MN
NEW BUSINESSEXIS11M BUSINESS
TOTAL PROJEC_ COST ESTIIIAT£: $3.800.000
PROPOSED USES: REQUEST: ..
LAND S ACIODNT OP LOAN 550.000
EXISTING BUILDIM MATURITY a TERMS
CONSTRUCTION $950,000 REQUESTED 5% 10 Yre
MAC9TOM CAPITAL 3350,000_ _ APPLICANT'S
WM=M CAPITAL 5400,000 EQUITY 5501000
OTM:R 5100,000 LOAN PURPOSE minnrnt
TOTAL USES 51.800,000
PROPOSED BEGINNING VJ=: va„ t naa
ESTIM)1TED COMPLETION DAZ:
TITLE TO
PROJEC.' ASSETS TO BE BS.D BY: _ OPERATING ENTITY ALTER OW
PAi1ICIPATIIX: LMMERMbrietiania Rank 11 West 42nd St. 7th Floor New York, NY 10036
INAM) (Agnes)
Mr. Armond Kni t --;-0y (21; 8274800
tcontaCt p-e[ion) (TQ.Lep0 W 1)
PPlS= i or EPSLOYEEs: 60 PROJm1C:0 1 or Datams 100+
ADDITIONAL PROJCC' MFWMATIO
APPLICAN_ SIC4ATURd: DATE SIMED:
IIEH
CO. T,
S0RIN6'MACHIGE"
f10,v35'.OLi
S.E. I ENOHER
II8:137.No
OMGA EMD MILLS
tlD:6iJ.00
SINGLE END TOOLING
24.0:50.00,
INIEClION MOULD TOOLING
10430.00
ALUMINUM 5A9,06LE STOPS
f::SGJ.iv
ALUM, PUNCH DIES.(FOY VALLEY)
VIM :N_
ALUM PUNCH 0115 6 AUTO FEEDER:
;211.556.00
OVERHEAD CRANE
2i.6iA.00
HINGE KNOCK OUT MACHINE
uS.0iJ.0J
MAIL TABLES
11.f4J.GO
VET GLAIE SYSTEM
110,510.00
AUTO FEED SCREVDRIVER
17,000.00
PROTECTION FEAD TOOLING
12.500.00
DIE CUT FOAM TOOLING
1600.00
HAIL FIN TOOLING
5.500,00
STRAP ANCHOR 10GLIHG
1W.00
CONNECTOR PLATE TOOLING
s600.00
VEEP HOLE PUNCH TOOLING
%Iao0.00
906D SHAPER
11 50.0)
MITRE CROP SAV
1350.09
GLAZING 6ENCHESITALIES
111.51,0.00
ALUMINUM MILL TGOUNG
� -
t_t O.GJ
FRArE,CIAnD
tFS,Cbfl,h1
AUTO RIVETER
1I.SCJ.JO'
ALUMINUM S1ORAGEVSYSIEM
1d,6L4.00,
ALUMINUM GORING KEAOS
12.000.00
NOD ASSEMBLY 1.14
110:360:00
4EAIRERSTRIP/GLA23KG-BACH114'
115:070-.
c.:
cdo
AL -21-•95 FRI 06:49 ID.
TEL NO:
0150 P02
v
PUBLIC RESOURCE.
GROUP, INC.
Mmta�, L�wrtopna+s: � Ftnanca SPadaiisu
TO: Otho ZMCV' uh„Eoanwadc DavatCumt Ditmmt
FROM Leonard P. Mracht, theddent
DAZE ... July 20, 1993.
sumscr.. gaudy 1?ieandaktiavtew and AlWyds
amla ow•Cmtpany
. ililffi'i®
Perswnt of yaw toques, f have mvifted the 7uoe 30, 1993 flnandat sanm as of the ii-
wtndaw Catopany. Thm atatmhents lura been submimad by the aompany fn to thdf
lima t+agoat¢ to do alum hfamdceno Rnmrpdm Pune.
no ibtlowlap is an enotparadve overview of the fimadd mu.meet of July 31, IM ad tae•
June 30. 1993 ataaameat u they tetate to cMMa in Snandal pmddmh and apetadao of do R -
Window t„onvany.
Over tit. the eauapany'a balance that is aceeptabto to typical lendkV wadards to terms of codas
and quaitty ta41com u shay MM to tae condition of its brtaoce sheet. May of the acted
dmaM ate dhady Mead d to WMCMVSAY debt ft nh SpiUm utitiied to purchase the apiM t
autllnad in our appUcadon to dao State of Mhummx An evervlaw of the emnV a to the balance
samt is u foitawa:
4205 tanc"mr Lane Natth • Sulo 11W • Mlnnavalik Mlnncwm 33441 • WD S54:979 • (612) 3569221 Fax
AL -21-95 FRI e8:50 ID: TEL NO. :3150 Pa3
H-Wiridow Compmy
6 month period aiding.
Juga 30. IM
Balance Shea (AARMILZOO
1. DW Rgedvable - The .81 days 67 days .(14) ftyS
number of days boween the
We at PO&JU - ad the
AAUAMAn Of PIYMM for the
PodUCL
2.- Days Uwanny - Volume 134 days 82 days dry:.
of rovealwy an hand and the
caLmmd number of days
nowsary to 1wen, this W4d
of Invenory..
VOCUM both of di=o it= am lums' of =A, a reduction In the number ai drys auodmd wilt dens Ilams
Rpm" dj&t CM Mquy has its cub &"a" 10 bW mune often sod dw its cub podglon Is no Ned up'.
While days tmdvWo are longer than seen in adwr Muories, this indicator con be qpcd In inboWn serving
dke conmuction uw1& ]I-WbWaw =ndmm w impmm dds Item.'.
Cres a
3. WwWaS CopiW 'SM.427 $610.063
bleumal d80 Gull xvail"
CD S by Md"Mcbs
curroing liabilities , ham.
canew suets.
4. CUMM Wo - M--aw 1.9:1 1.4:1
the wdbbflily of Hquld
CUMIS. suss. 0 urvlee
omm deft (current anew
• cunmt II.wI1
These items age represented MdMw introarjoy foadvabla and payables. While dws hu been a roductim
in these to=, 0" is saftued to add itis wM vistdo of long-term ddx auodOW with tbo bdluy
co=nsion of IM. 7b= items are feWlvdy UMB and MOM H -Window M IMVIM im dmt'wm
UabUWM with 111MMMIM
C) 2 1 !)
JLL-21-'95 FRI 08:50 ID: TEL NO: � ^^ � 0150 Pe4 -
S. Days Payable •'The 74 days SS days.
cur"b" of days batwem a
contpamy's mmipt of raw
311160eelais sed paymeat for
mase hems.
6 Mr Aemea4t I6 days 23 days 9 days .
lisbilfff s ' $ueh as *pias.
paymil am.. sect lamrem
As these leems allow the company dm to pay its obliptioas,they are a *roamer, of catlt. These ions have
been r"vety suble ad ars within recommended smoduft for We iadway.
z t
7. Dabs to Waft - Mannans' . 3:1 .97:1 A7:1
do amamt of debt V. equity
of the notal• value of Cho
atcngwy.. b breab out. me
amwmt fimuced 48911st the
antand that is owned.
This WU us dia fa every dollar owned by the Company. titers is S.97 of debt which bdiesaes slut the
aotnPsny Is ms sigtdAnotly leveraged. this is an imm we will watch and man' tta every coaly. 'This abbtD.
watt talo doss Cot iedude of bakaw sheet equity which reflow the true ansa value of the eougM n imW
to depredation vetaus utas vdm but iw inducts wbmdln W officar debt which is 'lib' agwty.
We
1993 bus beim well in this iadt stry and is positively impacdeS H window Cmupsny iaemdng its sans by
over 6091 compared to 1995 for this period, While we will clably monitor the pwformtm ftm a Bala
�
`
fidloadng�an melysis of the oempmy's aWm snd mu*s which haws been a eldy or
I1149i 51M am
1. Cm of Sala • iarludes 87.70 of ales us of alas (13.7%) of ales
row mamdats. labor. ptant
averhaad, and dep aladon
JLL-21-95 FRI 08:51 ID: TEL No. C1150 POS
2. Gross ft)dk - am of min 12.3% 26% 13.7%
bw dim am of aka.
7% gross praft swvim the
CGUIPM1 AdMILMILOWN&C and
deta aW*Mim&
3. , Mudmintadw and adw 32.9% 32.9% 00 dkwp
Expenses - Includes'
latclast
udIldca,
supplies, professional
Charm at.
4. Net PrOM (6.9%) 12.70
Tbis analysis anests that do mmw has mainwad its Ocaud am memses to wadmin in ast Operafts
WSM fat Of posted ohm IM to 199S. One -safficat change has lova[vedl as locissn'to pass mqt&'--
H-WbWm CAUlpany has ' ovemame a Urge
on Ion st this time In IM to Xmm a boar trot' less . leas this
period In 194! and 199?.
Based an do Intmmat mWy=r swcm=t of H-Wlnbw Conipmay fw dic pcnW ending Ivan, 30. IM it is Our
analysis that 00 map" has d9mift"y Unpaved in overall 6m-121 goddon ftem MS. While ft= am
may podttw acdvitift bdq pwfwmW by dw WwM. it mmdu In a anewhat didim" fiamigi pagiden
and will condmus to be is this situadon into ft Immediate Fame, thus raqWft chm mmbmbg of its
finsocial pond an a n*uW mots.
As site amnWy candouts to increase its pm margin, it is also -10-1 that it begin to adttae its fixed mus
U a pattentap of ULM thus wAtevint ptafiftinty. Its condaued Aga SJOVAh lbacid jdxbwxo this Aft'slian.
dp
0
APPROVAL OF
Ic GREATER MONTICELLO ENTERPRISE FUNDS
BY
ECONOMIC DEVELPMENT AUTHORITY
IN AND FOR THE CITY OF MONTICELLO, MINNESOTA
Preliminary Loan Application Approval. YES
Loan terms negotiated and agreed upon
betweeen the developer, the lending
institution, and the EDA Executive Director
Formal Loan Application and Financial
Statements analyzed by the lending
institution, BDS, Inc. or city staff.
Building and Site Plan Preliminary and/or
Final Review.
52 BETWEEN DEVELOPER, PRG, AND
KOROPCHAK.
PUBLIC RESOURCE GROUP, INC.
YES, BUILDING PLANS.
DRAINAGE CALCULATIONS NOT COMPLETEi
AND SUBMITTED TO OSM.
Building Permit approval or construction YES
commitment.
Loan documents reviewed and/or prepared
by the City Attorney.
ECONOMIC DEVELOPMENT AUTHORITY APPROVAL OR DISAPPROVAL:
w LOAN NUMBER GMEF Loan No. 008 LOAN APPROVED YES
BORROWER The H -Window Company
ADDRESS 1324 OAKWOOD DR. E., BOX 206 LOAN DISAPPROVED
LOAN AMOUNT $50.000 Equipment MONTICELLO, MN 55362
RATE 5.25% FIXED INTEREST RATE DATE JUNE 15. 1994
TERMS AMORTIZED OVER 7 YEARS.
FEE $750.00 PAID AT TIME OF GMEF DISBURSEMENT. ♦#
GMEF LEGAL FEES RESPONSIBLITY OF THE APPLICANT. OTHER"
A motion was made by EDA Commissioner BARBARA SCIIWIENTEK
to
(approve - dX1A* ( Ibq Greater Monticello Enterprise Funds in the
amount of FIFTY THOUSAND DOLLARS AND NO CENTS ($50,000.00)
dollars
and cents to developer THE H -WINDOW COMPANY
this 15th day of JUNE 1994
Seconded
by EDA Commissioner CLINT HERBST
YEAS: BARBARA SCHWIENTEK NAYS:
ABSENT:
CLINT HERBST BOB MOSFORD
PATTY OLSEN
RON HOGLUND
HARVEY KENDALL
Al. LARSON
GMEF disbursed 19 _ by Check No.
EDA Treasurer
FROM OTHER PAYBACK APPROPRIATIONS - UDAG ACCOUNT
�. CITY COUNCIL MAY REVERSE AN EDA LOAN DECISION WITHIN TWENTY-OIIE
DAYS OF EDA APPROVAL.
CITY COUNCIL REVIEW JUNE 27, 1994
GMEF Approval
Page 2
ACCEPTANCE OF TERMS
I �ereby accept the terms stated a o s approved by the
Economic Development Authority in and for of Monticello.
DATED:
• OTHER - APPROVED GMEF LOAN NO. 008 SUBJECT TO APPROVAL OF THE SCERG OF $250,000.
IF APPROVED GMEF LOAN NO. 008 DOLLARS OF $50.000 ARE NOT DISBURSED BY
DECEMBER 151
1994, THE APPROVED LOAN BECOMES NULL AND VOID.
V -4xr L—D -1. O�— w.... N S . , 4S S — O A& s n o -:,n — \ 5 . % 0 Q S .
THE CMEF WILL SHARE FIRST POSITION ON EQUIPMENT WITH THE SCREG OR WILL
BE IN SECOND POSITION ON THE EQUIPMENT.
COLLATERAL, GUARANTEES, AND OTHER CONDITION REQUIREMENTS TO BE DETERMINED
AND PREPARED BY THE GMEF ATTORNEY.
74 I-EGRL f(Ls R60-L,ci fS71 --,t7f FoQ Gr"ff find
Sc ERG i—tNS -
�J
EDA AGENDA
JUNE 15, 1994
J
Consideration to review the Dreliminary and final GMEF
aoDlication from aoolicant. the H -Window Comoanv.
Reference and Backaround.
On May 25, 1993, Pat Pelstring, Lenny Kirscht, and 011ie
Koropchak met with the Norwegian Board members and Steve
Lemme. The purpose of the meeting was to develop a rupport
between individuals and an understanding of the previous
funding attempts, and to discuss potential financial options
for the company's planned expansion.
The proposed expansion being a 25,000 sq ft manufacturing
addition, 4,000 sq ft second -floor office space, equipment,
and the addition of 45 new jobs.
In 1987, TIF District No. 1-7 was created for NAWCO and
provided assistance of S110,000 for land write-down of Lots 11
and 12, Block 2, OIP. The company completely financed the
original 28,000 sq ft facility, balance of land cost,
machinery & equipment, and necessary working capital. Current
employment is 30.
The first expansion financial proposal included the issuance
of $1.175,000 of G.O. TIF Bonds by the EDA, Small Cities
Economic Recovery Grant (SCERG) of 5500.000, equity of
$400,000, and less annual Tax Increment Financing (TIF)
revenues of $35,000 over 8 years for debt service retirement.
On June 7, 1993, the EDA elected not to issue the bonds
because In your opinion the projected bond rate of 7.6% was...
comparative to commercial lending and not a sufficient savings
to the H -Window. Additionally, the EDA recommended maximum
use of TIF, an aggressive approach of the State's $500,000,
and an explanation to Mr. Lemme of the EDA's recommendation.
The revised financial proposal sent to Norway included the
same sources except the G.O. Bonds were replaced with
commercial lending and the less annual TIF revenues reduced to
$20.000. Thereafter, the StAte rejected the proposed job
forgiveness of $100,000 which was replaced with an application
to the Central Minnesota Initial Fund (CMIF).
On August 19 and after Public Resource Group recognized the
one cannot decertify an existing TIF District boundary and
certify a new district, the HRA approved the use of the
estimated additional tax increment from the District No. 1-7
combined with 14RA-TIF surplus dollars in an amount not -to -
exceed $160,000 ($113,000 net present value at 7% for site
Improvements) pay-as-yQu-go assistance. The NRA elected to
accept the TIF loss in order to save embarassment and allow
L nw
EDA AGENDA
JUNE 15, 1994
support of the project.
The 25,000 sq ft manufacturing addition has been completed:
however, the 4,000 sq Et second -floor office has not received
its occupancy permit.
After discussion and numerous term and condition requests by
the State' Mr. Lemme, Knut Flakk, Brad Simenson and Dentley
Haugesag, MTED, and Koropchak met on May 4, 1994 to review the
project. It is my understanding that Mr. Simenson will
recommend to the State Board the approval of $250,000 SCERG
based upon satisfying the terms and conditions as outlined in
the enclosed letter. Note the total project cost has been
reduced from $2,075,000 to $1,800,000 because some equipment
has been purchased since the initial financial proposal.
On June 1, I heard verbally from Jeanne Endahl. The Board of
Directors denied approval of the 9100,000 CMIF request based
international ownership which does not meet their residency
requireme%xt of the 14 -county area or potential waivers. It
was not denied because of any financial credibility issue.
Therefore to meet the State's terms and conditions, the EDA is
asked to review the preliminary and final GMEF application for
approval of a $50,000 equipment loan. Another $50,000 of
4— equity will be injected to make up the $100,000 gap created by
the CMIF denial.
The $950,000 construction and site improvement costs were
funded through a bank, $550,000 and equity, $500,000. The
$400,000 working capital need through a $150,000 Bank Line of _
Credit and $250,000 of equity. The $350,000 equipment funding
is proposed at $250,000 SCERG, $50,000 GMEF, and $50,000
equity.
Since the construction financing is history and the work
capital a separate issue, I only outlined the funding of the
equipment.
GMEF LOAN APPLICATION REQUEST:
$50,000 for equipment, 5.0% interest rate over 10 years,
shared first -position with the State.
USES OF FUNDS
Equipment $350.000
TOTAL USES OF FUNDS $350,000
S
EDA AGENDA
MARCH 7. 1995
7. Consideration of an update on GMEF Loan No. 008 for the H-
Wi ndow.
A. Reference and Background:
On June 21, 1994. Koropchak reported she contacted Mr. Lemme
regarding the ownership percentage discrepor.cy on the
preliminary GMEF application and the executive summary. Mr.
Lemme indicated that most recently the Norwegian ownership
percentage changed as Spilka International and Beckman became
larger shareholders as they bought out a percentage of
Fjerdingstad.
The EDA approved GMEF Loan No. 008 for the H -Window Company on
June 15, 1994. The approved $50,000 equipment loan had a
fixed interest rate of 5.25% and amortization of seven years.
The loan became null and void on December 15 if monies were
not disbursed. On June 27, the City Council ratified the
EDA's loan approval.
On December 15, the EDA approved the extension of the GMEF
disbursement date to January 15, 1995. Loan yo. 008 became
null and void as of January 15 because under the circumstance
of new information, Korochak felt the EDA needed to be
informed prior to another extension date approval.
Initially it was thought that the $250,000 Small Cities
Economic Recovery Grant (SCERG) to the City of Monticello
would be from State dollars. However, upon the suggestion of
the State and agreement of the H -Window, the S250,000 Grant
was to be funded by Federal dollars. This is an advantage to—
the City as the City retains the full 5250.000 principal and
interest payback. however, the company is subject to stricter
levels and accountability of jobs available to and filled by
minorities and low/moderate incomes.
A copy of the May 16, 1794 grant terms and conditions were
submitted to the H -window and thereafter revised. The grant
award letter was received August 17, 1994 and a copy of the
executed grant agreement was received November 0, 1094. Grant
monies must be disbursed by the middle of June, 1995.
In December and upon. Attorney woingarden'a proparation of the
closing loan documents for the SCERG and the GMEF, it became
apparent that the H -Window owed back payments of $260,000 plus
Interest on the Norwegian Industrial Fund. Forgiveness of the
default interest is under negotiation: however, payment of the
C; Page 1
S
EDA AGENDA
MARCO 7. 1995
loan principal is due. The State requested $300,000 equity
and the e•r.ecution of the Standby Agreement from the Norwegian.
Industrial Fund shareholders.
It is my understanding, the State will now accept an annual
letter of credit in the amount of 5300,000 from the Christiana
Bank of New York as collateral for the State Grant and GMEF.
Mr. Steve Lemme has received a verbal "yes" from the New York
Bank and hopes to have an official response by Wednesday,
March 1, 1995. Mr. Lemme will be out-of-town after March 1.
If the letter of credit is issued, the EDA will reconsider the
loan application for approval of GMEF Loan No. 009.
As an EDA member, please be remindful of the importance of
•confidentiality'.
Pago 2 G
j Grant Adjustment Notice Number 1
1
Paragraph 5, page 1 of the Grant Agreement dated August 16, 1994
between the State of Minnesota, acting through the Department of
Trade and Economic Development and the City of Monticello shall
change as follows:
From:
The Grantee shall perform the activities that are proposed
in the Application and are further specified under special
conditions during the period from August 16, 1994...
To:
The Grantee shall perform the activities that are proposed
in the Application and are further specified under special
conditions during the period from June 30, 1994...
Section 4. of the Special Conditions of the Grant Agreement dated
August 16, 1994, shall change as follows:
To:
4. Funds will not be released until the following is submitted
to the Grantor and approved:
a) Evidence of loans closed to the following entities:
1. Greater Monticello Economic Fund in the amount of
$50,000.
b) New Equity injection of $1,000,000.
C) Letter of Credit in the amount of $300,000 as
security for the loan.
d) Corporate Guaranty from North American window Company. -
H -window Company may substitute assets of the company as
collateral for the loan in place of the Letter Of Credit once the
conditions in Exhibit A are met. The collateral for the loan
shall be:
A shared first security position in $400,000of existing
production equipment. Value of existing machinery to be
based on depreciated boot; value at a minimum of $5,000 per
piece of equipment.
f t//,'I *cerra ey S�son, Senior Loan Ot
Departme//of Trade & Economic Development
City at Mont6kelfo D to
t
EXHIBIT A
J
l_
CERTAIN FINANCIAL COVENANTS:
1) H -Window shall maintain a Net worth of not less than
$1,700,000. •0,% - \, >g0 • `a-ako
2) The Borrower shall maintain a ratio of earnings before
paying interest on all indebtedness, income taxes and making
allowances for depreciation and amortization (all in
accordance with generally accepted accounting principles) to
regularly scheduled payments of principal and interest on
all Long Term Indebtedness of the Borrower averaged for the
last three (3) full fiscal years of the Borrower of at least
1.5 to 1.0.
f
31 Borrower shall have a Debt-to-equity ratio of 2.25 or less.
4) The Borrower will be eligible to substitute collateral after
the financial statements for the year ending December 31,
1991 have been issued.
5) To be eligible to substitute collateral one of the two most
recent year financial statements must be audited financial
statements in accordance with generally accepted accounting
standards.
O
EDA AGENDA
JULY 25, 1995
4.Consideration to anorove or disanarove GMP.F Loan No. 009 for
The H -Window Company.
A. Refert?nce and Background:
Following discussion of the preliminary and form:ll GMEF
application for The H -Window Company; the EDA ig asked to
consider approval or disapproval of the recommended $50.000
rMEF Loan. The applicant requested Corms of 5% interest rate
:tmort.ized over ten years.
First, the EDA needs to detorminc if the GMEF loan application
from Mr. Lemme will pnconrnge economic, devpinpment, and that
thn proposed H' -Window expansion project and application
complies with the CMF.F public purpose criteria and policieu.
As this to a second application for funding, the BDA
recognizes the project has created 80 jobs since the first
application with other local economic development spin-offs.
Additionally, property taxes have doubled with the expansion.
However, it Is my understanding the permanent Occupancy Permit
has not been issued for the expansion and is subject to
completion of the second -floor office. parking, and screening.
r Secondly, with the assumption the project appliratlan complies
with the public purpose criteria and policies, the FDA moat
determine the amounts rt the .loam, interest rata and terms,
service and legal fees, and required equity. Additionally,
the FDA must determine neceesary collateral or any other
crlull tions.
Recommendation is the R-liindow Company must to submit
quarterly financial statements to the BDA for the first two-
yoare and thereafter, semi-annually. This to monitor the R-
wlndow"s financial position and for the necessity to renew
annually the Lotter of Credit. It to suggested the Getter of
credit in-proeoss expire December 91. 1996.
It is N!iggested that the .approvttd $60.00n be t1V41%uvt4rd from
the tltliter Patylw-k Apprnyriarl.one, ODAO account.
R, AlternAtiv_it Ael: nna%
1,. A motion its approve r.ME! Lt.an N9. 001 fur T1tN H Wind..w
ISfi1111..Any. Loan .+mount and trrm" ao r.-.lupsitod- 6501000
for t,sp,1101•ne at. 5.nx int.•rrrut rAtu wmnrtivwd nvor tpu
yt !.a r�..
t P.tye, 1
EDA AGENDA
JULY 25, 1996
2. A motion to approve., GMEF Loan No. 009 for the H -Window
Company. Loan amount and turme as per tho guidelines:
$50,000 for equipment at 6.758 amortized over sovnn
years.
3. A motion to approve GMEF Loan No. 009 for the H -Window
Company. Loan amount and terms as suggested: $50,000
for equipment at the negotiated interest rate of 6.08
amortized over seven years.
4. A motion to approve GMEF Loan No. 009 for The H -Window
Company. Loan amount and terms as determined by the EDA.
5. A motion to disapprove GMEF Loan No. 008 for The H -Window
Company.
C. Staff Rncommendation:
Assuming the EDA determines that the proposed project compliea
with the GMEF public purpose criteria and po]iciea, staff
supports either Alternative No. 2 or 3. Additionally, the EDA
must determine service/logal fees and equity/collateral
requirements and any other conditions, and direct the City
Attorney to prepare necessary closing documents. Thv approved
$260,000 State/Federal loan torms and conditions remain at 0%
(1-2) and 58 (3.10) over ten years.
D. Sunaortinq Date:
1. Copy of the GMEF Approval Form.
rags, 2
APPROVAL OF
GREATER MONTICELLO ENTERPRISE FUNDS
BY
ECONOMIC DEVELPMENT AUTHORITY
IN AND FOR THE CITY OF MONTICELLO, MINNESOTA
Preliminary Loan Application Approval. YES JUNE 23, 1995
Loan terms negotiated and agreed upon
betweeen the developer, the lending
institution, and the EDA Executive Director. NOT INTEREST RATE OF 6.75%
YKO Ktuunft KUJ D.U•
Formal Loan Application and Financial
Statements analyzed by the lending
institution, BDS, Inc. or city staff. PRC - JULY 20, 1995
Building and Site Plan Preliminary and/or NO PERMANENT OCCUPANCY PERMIT.
Final Review. SUBJECT TO COMPLETION OF 2ND-
rwUK Ur r il.a. iWua ,U, AAL PARKING
Building Permit approval or construction AND SCREENING.
commitment. YES
Loan documents reviewed and/or prepared
by the City Attorney.
t
ECONOMIC DEVELOPMENT AUTHORITY APPROVAL OR DISAPPROVAL:
LOAN NUMBER GMEF LOAN NO. 009 LOAN APPROVED
BORROWER THE H -WINDOW COMPANY
ADDRESS 1324 OAKWOOD DR. Ei Box 206 LOAN DISAPPROVED
LOAN AMOUNT f50.000 EQUIPMENT
RATE DATE
TERMS
FEE 171QIOQ PAID AT TIME OF GMEF DISBURSEMENT.
CHEF LEGAL FEES RESPONSIBILITY OF THE APPLICANT.
A motion was made by EDA Commissioner to
(approve - disapprove) Greater Monticello Enterprise Funds in the
amount of dollars
and cents to developer
this day of Seconded
by EDA Commissioner
YEAS: NAYS:
GMEF disbursed 19 _ by Check No.
EDA Treasurer
DISBURSEMENT FROM UDAG ACCOUNT.
CITY COUNCIL MAY REVERSE AN EDA LOAN DECISION WITHIN TWENTY-ONE
DAYS OF EDA APPROVAL. CITY COUNCIL REVIEW AUGUST 14. 1995.
GMEF Approval
Page 2
ACCEPTANCE OF TERMS
I (We) hereby accept the terms stated above as approved by the
Economic Development Authority in and for the City of Monticello.
DATED:
C
EDA AGENDA
,l JULY 25, 1995
S. Consideration to dincuss the EPA Budoet and Llqunr Fund
Apo ropriation for rPrnmmendation in nreoaration of thr. 1986
City Bndant.
A. Reference and Backaronnrt:
As per the enclosed memo from Administrator Wolfateller-, staff
Is in the 1996 budget preparation period. For the 1995
hudgot, the EDA requested an appropriation of $100,000 from
the Liquor Fund, At this time, no Liquor Fund appropriations
have been disbursed,
Secondly, enclosed is a copy of the EDA •- 1995 Conti Flow
Projections and fund balance reports of the O DAG and SCREG--
Aroplax which are sources of funds available for GMBF Inane.
Assumption, December 1995:
EDA Cash Flow Projection, December 1995 $255,000
UDAG Projer_tfon, December 1995 $ 81,000 Jan 100
0131,014 less $50,000 H -Window)
SCREG•Aroplt,x Project, December 1995 $ 94,200 Jan 197
TOTAL SOURCES OF FUNDS $430,200
Other assumptions:
Revenue: SCEROJH-Window, $250,000 payback., Oct 005.
Expenditures: Tipper, $80,000
Vector Tool, ?
Pipeline Supply, ?
Would the Eno like to requcst a $100,000 appropriation from
the Liquor Fund for 1996 City Budget?
Thin may be ronwideri-d urturity since additional provit4lon+3
were placed on the uer• of TIr by LopiHlators and Counttll iP
more rmluctant to use TIF becausr, of the HACA PanBi.ty.
B, J11t.�xa�ative+_ Ant jnnu.�
1. A motion requrrtAng w $100.000 aliprupriatiun from the
l,1quirr Fund for 1896 city Bodgot prep.rratinn.
2. A mot:1on retluatating tin appropriatlnn from the Liqut+r Fund
Pur 19gR City Budprt praparattnn.
Pago .i
t
EDA AGENDA
JULY 25, 1995
3. A motion requceting an appropriation amount from the
Liquor Fund for 1996 City Budget as determined by the
EDA.
C. Recommendation:
EDA Treasurer wolfeteller has no problem with the EDA
requesting an appropriation of $100,000 from the Liquor Fund
for 1996, recognizing Council has final approval. This is
recognition of the restrictions or limitations placed on TIF.
D. Suponrtina Dnta:
Budget memu, 1995 EDA Cash Flow Projections, and UDAG and
SCERG-Aroplax Fund reports.
Page 2
OK
L 6 y
MONMCELLO
L
Office of the Cit Administrator
250 East Broadway
Monticello. MN 55362.9245
Phone: (612) 295-2711 MEMO
Metro: (612) 333.5739
TO: Department Heads/Supervison3/S
FROM: Rick Wolfsteller, City Adminis cite j
DATE: July 12, 1995
RE: 1996 budget preparation
By September 15, the City Council must adopt the preliminary 1996 budget and set the tax
levy requirements for next year. Although this budget and tax levy will only be
preliminary figures, the tax levy adopted by the Council, either at its August 28 or
September 11 Council meeting, will be the maximum allowable, so we should attempt to
prepare a tentative budget for each fund and department that will closely resemble the
final proposed budget we want.
This year it is my goal to prepare a preliminary budget earlier than usual and distribute to
the City Council so that we can schedule one or more workshops with the Council to go
over the budget before the September 15 deadline. I would hope that any capital outlay
items or controversial issues that may be included in the budget will be discussed
thoroughly by the City Council prior to the preliminary adoption so that the Council is
more comfortable with the budget being presented. In the past, we've always indicated to
the Council that major purchases or controversial items would again be considered by the
Council before actual purchase, but I would like to see the Council discuss the individual
items in more depth prior to placing them in the budget. If the Council is going to be dead
set against any particular item in the budget, maybe it shouldn't be included in the
preliminary budget, and this could leave room for other purchases that aren't quite as
controversial. It makes no sense to establish a preliminary and final budget in one year
and then, with the same Council, completely reverse their initial approval of the item. I
think the only way we can eliminate the obvious items that won't be approved in the
MEMO
1996 Budget Worksheets
July 12, 1995
Page 2
future is to place more emphasis on discussing the budget prior to adoption and not place
funds in the budget for something that is obviously controversial. Additional workshops
may not be the answer, but it's worth a try.
Attached you will find the budget worksheets that pertain to your individual departments.
As in the past, there are some items I will prepare, including depredation, insurance cost,
and salary and benefit allocations. It may be best if you leave the salary and benefit
categories blank at this time, as I only need to know if you are requesting additional
employees, etc. As far as temporary or seasonal personnel, you can estimate the salary
cost for these positions on the worksheets. Also, if anyone has capital outlay type items
you'd like to see in the 1996 budget but do not have a department budget worksheet to
complete, make a list of the items (i.e., furniture, equipment, etc.) and return to me.
As a final note, I would suggest the budget sheets and/or list of items be returned to me by
Friday, August 4, to allow for sufficient time to complete the preliminary calculations.
J
MONTICELLO ECONOMIC DEVELOPMENT AUTHORITY
GREATER MONTICELLO ENTERPRISE
FUND (GMEF)
1995 Cash Flow
Projection
BEGINNING CASH BALANCE, January 1095
S209,584.73
RECEIPTS
Appropriations, Expected -
Liquor Fund
S100,000.00
UDAG
$
50.000.00
SCREG-Aroplax
$
50,000.00
Notes Amortization Payment: -
Tapper Inc. ($736.07 Mo.) 8-97
S
8,832.84
Muller Theatre
-0-
SMM, Inc. ($316.32 Mo.) 12-97
$
3,795.64
Aroplax Corp. ($1,241.73 Mo.) 12-99
S
14,900.76
Custom Canopy, Inc. ($269.03 Mo.)
6-98 $
3,228.36
Standard Iron ($795.49 Mo.) 7-01
$
9,545.90
Interest Income - Investment
$
3,000.00
Loan Fees
$
2,250.00
Miscellaneous
$
1,300.00
TOTAL RECEIPTS
5246,853.70
- TOTAL BEGINNING BALANCE AND RECEIPTS
$456,436.43
EXPENDITURES
GMEF Loans -
H -window
$
50,000.00
Tapper, Inc.
$
50,000.00
Other
$100,000.00
Legal Foes
$
11000.00
Service Fees
2=
150.00
TOTAL EXPENDITURES
5201.150.00
EXPECTED CASH BALANCE, December 1995
$255,188.43
1
'a
URBAN DEVELOPMENT ACTION GRANT (UDAG) - FSI
FINANCIAL REPORT
March 7, 1995
Payback began in January, 1988 for 12 years ending in January, 2000.
Annual principal and interest payback total is $27,971.40.
GRANT TOTALS
ORIGINAL
PAID REMAINING
Principal $256,957.71
$140,730.78 $116,226.93
Interest $78,699.09
$57,399.97 $21,299.12
TOTAL $335,656.80
$198,130.75 $137,526.05
REVENUES
Principal Payback
$140,730.78
Interest Payback
$57,399.97
Interest Income - Investment:
1990
$3,562.62
1991
$8,593.59
1992
$8,436.32
1993
$7,918.92
1994 (est.)
$3,901.00
Transfer from GMEF - [company]
Transfer from GMEF - [company]
TOTAL REVENUES
$230,543.20 _
exeENDEUBES
1991 Transfer to GMEF
$65,000.00
1992 Transfer to GMEF
$20,000.00
1993 Transfer to GMEF
$42,500.00
TOTAL EXPENDITURES
$127,500.00
FUND BALANCE FOR ECONOMIC DEVELOPMENT $103,043.20
Docombor 31, 1 994
UDAG.WK t : 03/03/95
SMALL CITIES ECONOMIC RECOVERY GRANT (SCERG) - AROPLAX
FINANCIAL REPORT
March 7, 1995
Payback began in December, 1992 for 7 years ending in November, 1999.
Annual principal and interest payback total is $29,801.40.
First $100,000 principal payback ends January, 1997.
GRANT TOTALS
Grant must be expended by December 31, 1994, up to $170,000.
EXPENDED: $116,556.75
ORIGINAL
PAID
REMAINING
Principal
$170,000.00
$50,115.40
$119,884.60
Interest
$37,969.92
$11,970.95
$25,998.97
TOTAL
$207,969.92
$62,086.35
$145,883.57
Principal
Jan. 1997
$170,000.00
GMEE
$100,153.60
STATE
$69,846.40
Interest
$29,634.75
$23,659.34
$5,975.41
TOTAL
$199,634.75
$123,812.94
$75,821.81
Grant must be expended by December 31, 1994, up to $170,000.
EXPENDED: $116,556.75
1993
$16,996.18
1993
$12,356.59
1993
$4,021.10
1/18/94
$15.132.50
4/13/94
$4,936.88
7/20/94
$170,000.00
HEMEN M
Principal Payback
$50,115.40
Interest Payback
$11,970.95
Interest Income - Investment:
1993
$1,061.92
1994 (est.)
$1.256.00
TOTAL REVENUES
$64,404.27
EXPENOMMS
Transfer to GMEF
$0.00
TOTAL EXPENDITURES
$0.00
FUND BALANCE FOR SMALL CITIES GRANT
DGCOMWr 31. 1994
SC ERG•A. WK 1: 03/03/95
EDA AGENDA
JULY 25, 1998
6. Consideratinn to amend the GMF.P Guideline provision: Loan
Size.
A. Reference and Rackqround:
Loan Size: Minimum of $5,000 and maximum not to exceed
50% of the remaining revolving loan fund
balance; for example, if the remaining
revolving loan fund balance Is $50,000, the
maximum loan issuance is $25,000.
Upon reviewing the EDA year-end financial statements with the
IDC, a suggestion was made to name a "percenrag,•" of the
revolving loan fund balance for annual approval/dishurHrment.
I believe the IDC understood the guideline to mran 501: of the
annual $200,000 appropriation and not the revolving loan fund
balance of $430,000 (Dec 195). The IDC was concerned if for
example the EDA received four excellent GMEF application+
totaling $200,000 that the guidr.-lines would prohibit approval.
Additionally and originally, the $200,000 uppropriation from
the Liquor Fund was the only source of fund contributing to
the revolving loan fund balance and people may not distinguJoh
the difference between the revolving loan fund balance and tho
annual Liquor Fund Apprnprlatlon. Tho only reference within
the GMEF Ouldolinco of the $200,000 Ju the "Letter of Credit"
from Monticello City Council - $200,000. Source - City Liquor
Store Fund.
wolfeteller and I believe the intent of this provinion was to
eGtahlioh a minimum ($5,000) and maximum ($100,000) loan
amount for approval per applicant or application.
Thu EDA may want to consider amending the provision to read:
LOAM S1ZR: Minisus of 06.000 and snsisus of 8100.000.
All loan else approval* subject to available
funds of the revolving loan fund balance or
not to exceed 50% of the remaining revolving
loan fund balance.
B. AltArna>ivw_ALUnnv
A mntion to amend the GMEF Provisinn Lu.in Aire 10 read an
recomm^nded above Nnd rogiiw4ting the City Connell
rnwilder and Approvo thu amrndm•nt.
EDA AGENDA -
--
-JULY 25, 2995
2-. A motion to amend the GMEF Provision Loan Size to read be
suggested by the EDA and requesting the City Council
consider and approve the suggested amendment.
3. A motion to deny amending the GMEF Provision Loan Size.
C. Recommendation:
Wolfsteller and Koropchak recommend Alternative No. 1 to
clarify the minimum and maximun loan size as its original
intent.
D. Sunoortino Datn:
Excerpts from the GMEF Guidelines.
' Pnge 2
IV. TERMS AND CONDITIONS
' LOAN SIZE - Minimum of $5,000 and maximum not to
exceed 50% of the remaining revolving loan
fund balance; for example, if the remaining
revolving loan fund balance is $50,000, the
maximum loan issuance is $25,000.
' LEVERAGING - Minimum 60% private/public non-GMEF
Maximum 30% public (GMEF)
Minimum 10% equity EDA loan
' LOAN TERM - Personal property tern not to exceed life of
equipment (generally 5-7 years). Real estate
property maximum of 5 -year maturity
amortized up to 30 years. Balloon payment at
5 years.
• INTEREST RATE - Fixed rate not less than 2% below
Minneapolis prime rate. Prime rate per
National Bank of Minneapolis on date of EDA
loan approval.
• LOAN FEE - Minimum fee of $200 but not to exceed 1.5%
of the total loan project. Fees are to be
documented and no duplication of fees
between the lending institution and the RLF.
Loan fee may be incorporated into project
cost. EDA retains the right to reduce or
waive loan fee or portion of loan fee. _
• PREPAYMENT
POLICY - No penalty for prepayment.
• DEFERRAL OF
PAYMENTS- 1. Approval of the EDA membership by
majority vote.
2. Extend the balloon if unable to
refinance, verification letter from two
lending institutions subject to Board
approval.
• INTEREST
LIMITATION ON
GUARANTEED
LOANS- Subject to security and/or roviewal by EDA.
GMEF GUIDELINES: 6/27/94 Page 3
regarding applicant credit and financial viability of the project. After analysis
is complete, City staff shall submit a written recommendation to the EDA. A
decision regarding the application shall be made by the EDA within 60 days
of the submittal of a completed formal application.
6. The EDA shall have authority to approve or deny loans; however, within 21
days of EDA approval, the City Council ma;, reverse a decision by the EDA to
approve a loan if it is determined by Council that such loan was issued in
violation of GMEF guidelines.
7. Prior to issuance of an approved loan, the City Attorney shall review and/or
prepare all contracts, legal documents, and intercreditor agreements. After
such review is complete, the City shall issue said loan.
ORIGINAL REVOLVING LOAN FUNDING
"LETTER OF CREDIT" FROM MONTICELLO CITY COUNCIL - $200,000
SOURCE - City Liquor Store Fund
City shall transfer needed loan amount from existing accounts at such time that
individual loans are approved. Revenue created through this program shall be under
the control of the EDA and shall not be transferred to City funds unless the City
Council determines that reserves generated are not necessary for the successful
operation of the Authority. If such is the case, such funds must be transferred to the
LEdebt service funds of the City to be used solely to reduce tax levies for bonded
indebtedness of the City (see Section 5 B of the ordinance establishing the Monticello
DA).
REPORTING er
Staff shall submit quarterly summaries and/or annual report detailing the
status of the Monticello Enterprise Fund.
FUND GUIDELINES MODIFICATION
At a minimum, the EUA shall review the Fund Guidelines on an annual basis.
No changes to the GMEF guidelines shall be instituted without prior approval
of the City Council.
LOAN ADMINISTRATION
City staff shall service City loan, shall monitor City position with regard to the
loan, and shall assure City compliance with intercreditor agreement.
GMEF GUIDELINES: 6/27/94 Page 6