IDC Agenda 03-21-1991
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AGEND
MONITCELLO INDUSTRIAL D VELOPMENT COMMITTEE
Thursday, March 21, 1991 - 7:00 AM
City H 11
MEMBERS:
Chairperson Shelley Joh Don smith, Ron Hoglund,
Lowell Schrupp, Arve Grim mo, Dale Lungwitz, Jay Morrell,
Harvey Kendall, Ken Maus, Dave Peterson, Dennis Taylor,
Tom Pogatchnik, Linda Mie ke, John McVay, Bob Dawson, and
Candy Benoit.
Rick wolfsteller, Jeff O'INeill, and Ollie Koropchak.
I
STAFF:
1. Call To Order.
2. Approval of the February 21, '991 IDC Minutes.
3. Consideration to Review Resea Information:
a) Community Profile Compari
b) Industrial Site Compariso
c) Monticello Available Indu
d) Champlin Development Park
4.
Consideration to Acknowledge
Summary of the BRE Surveys.
Recertification and
5.
Consideration of Prospects:
a) Aroplax
b) Shingobee Builders, Inc. (TFI/SPEC Proposal)
c) Towle Real Estate
6. Other Business.
7. Adjournment.
Chamber of Commerce Meeting today at 11:50 AM, American Legion,
Open Meeting.
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MINUTES
MONTICELLO INDUSTRIAL DEVELOPMENT COMMITTEE
Thursday, February 21, 1991 - 7:00 AM
City H 11
MEMBERS PRESENT: Chairperson Shell
Smith, Arve Grimsmo, Bob Dawson,
Dennis Taylor, Jay Morrell, Harvey
Linda Mielke, and Candy Benoit.
y Johnson, Vice Chairperson Don
Tom Pogatchnik, Ron Hoglund,
Kendall, John McVay, Ken Maus,
MEMBERS ABSENT: Lowell Schrupp an Dave Peterson.
STAFF PRESENT: Rick wo1fsteller a Ollie Koropchak.
1. CALL TO ORDER.
In the absent of Chairperson
Smith called the IDC meeting t
ohnson, Vice Chairperson Don
order at 7:00 AM.
IDC MINUTES AND THE
2.
CONSIDERATION TO APPROVE THE J
JANUARY 22nd IDC SUBCOMMITTEE
Ron Hoglund made a motion to
minutes, seconded by Dennis Ta
as written.
the January 18th IDC
minutes were approved
Ron Hoglund made a motion to approve the January 22nd IDC
Subcommittee minutes, seconded by Harvey Kendall, the minutes
were approved as written.
3. CONSIDERATION TO HEAR AND
THE IDC FINANCIAL REPORT.
Treasurer Ron Hoglund report d a balance of $4,125.00 at
Security Financial and a balanc of $1,458.67 at Wright County
State Bank for a total IDC bala ce of $5,583.67. Dale Lungwitz
made a motion to accept the Treasurer's Report, seconded by Bob
Dawson, the report was accepte and filed.
4.
CONSIDERATION TO REVIEW AND AD PT THE FINAL DRAFT OF THE 1991
IDC GOALS AND PROPOSED BUDGET.
Koropchak presented the IDC m mbers with a copy of the 1990
Economic Development Report an congratulated the members for
accomplishing twenty-two goals out of twenty-four goals set.
Jay Morrell asked for a comparison of wages throughout the
state. Also, Mr. Morrell inqu red of the meaning of aesethic
value and how it relates to industrial zoning. Koropchak
responded that with the use of IF the city has some control on
a development. A developer ay be encouraged to build a
concrete facility versus a metal or TIF site improvement costs
Page 1
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IDC Minutes
2/21/91
can be suggested for the use of berming, screening, undergound
sprinkle systems, etc. to main ain the aesethic value of the
park. It is not intended to di' courage industrial development
as the zoning ordinance is a :guideline for heavy and light
industrial businesses. An exam Ie of concerned aesethic value
is SMA Elevator Construction outdoor storage area. This
concern was raised by both Re ele Engineering and Tapper's
Inc. upon site selection.
On the list of Monticello ustries and their respective
number of employees, the IDC su gested that an asterisk follow
the Bridge Water Telephone Com any line stating this business
is "new to the report" which wi 1 clarify the overall net gain
of industrial jobs. The IDC ac' epted the report and asked for
a revised copy.
The IDC then received a copy of the 1991 Economic Development
Work Plan which was drafted fro the goals set by the IDC Goal
Subcommittee. The new format 0 the report is consistent with
the Star City format which inclu es objectives, task, time, and
assignments. Koropchak highlig ted revisions made since the
last IDC meeting, stating that the addition to research the
need and cost to construct a d install an industrial park
entrance sign was a BRE sugges ion. Dale Lungwitz suggested
the available industrial lots reeway sign be reinstalled on
the realigned Fallon Avenue.
Koropchak asked for IDC input 0 the task: Host a meeting with
Farm Credit to discuss the pr s and cons for ownership of
approximately 60 acres of indust ial lands. Although, the idea
was bought before the City Coun iI, Koropchak was not clear of
the non-benefits of ownership nd how the cities of Champlin
and Owattona develop indust ial parks which state no
assessments against lots. The I C suggested to change the task
statement to Continue to discus the ros ----, The proposed
budget was reviewed with the a justments made since the last
IDC meeting: deleted $400 from appraisal, and added $1,000 to
market program and added $1,000 0 miscellaneous expense. Dale
Lungwitz made a motion to adopt the 1991 Economic Development
Work Plan and Proposed Budget with the revisions as earmarked,
seconded by Arve Grimso, t e motion received further
discussion. Further discussion ncluded the acknowledgement of
five industrial lots availab e for sale by the Oakwood
Partnership; knowledge of Kle n property large industrial
development potential limitatio s due to power lines, natural
gas lines, and Amoco pipelines; and the knowledge that $20,000
was budgeted for a overall devel pment study of storm drainage,
water, sewer, and roads for future industrial developments.
The study to be conducted by Dahlgren, Shardlow, and Uban. In
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IDC Minutes
2/21/91
summary, the IDC's greatest concern is the limited amount of
platted industrial lots readil available.
John McVay made a motion to amS d the original motion with the
addition of another task to page five. Addition: Complete an
inventory of existing industrial properties, comparing platted
to unplatted, illustrated by t e use of maps. The motion was
seconded by Ron Hoglund and ithout further discussion the
members approved the 1991 Eco omic Development Work Plan and
Proposed Budget as written, adjusted, and amended. The motion
carried unanimously. A copy of the revised work plan and
budget will be made available t the IDC members. City Council
will be asked to adopt a resolu ion approving the work plan and
budget before submittal to the epartment of Trade and Economic
Development for Star City Rece tification.
Vice Chairperson Smith acknow edged the efforts of the work
plan and that the document cou d also be
used as a tool by the city sta f.
5.
CONSIDERATION OF AN UPDATE ON THE PROGRESS OF THE TIF /SPEC
PLANS.
Koropchak reported that Mr. Pelstring, Gae Veit, and herself
met on February 8th to confirm he received Shingobee proposal
and to establish the next pI n of action for the TIF /SPEC
Plans. Shingobee requested the following modifications to the
proposal: The selected develo er shall submit a development
commitment fee in the amount of actual costs to re are the TIF
District Plan and the Develo m nt Contract. This replaced a
development commitment fee of $ ,000. Second modification, the
life duration of the request fo proposal shall terminate upon
execution of the development contract during construction
season 1991. I f the develo ent contract is not executed
durin the construction season 1991 the re uest for ro osal
shall receive automatic renew I sub"ect to HRA re uest for
withdrawal. This replaced the ife duration of the request for
proposal shall terminate upon execution of the development
contract or upon the end of contruction season 1991, whichever
is first. .
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Koropchak requested that the I developer give a minimum and
maximum timetable for proposal construction completion. The
lease rates were confirmed a $4.75, $4.50, and $4.25 per
square foot without the use of TIF.
When comparing request for pr posal building and labor costs
with other submitted proposal, Ms. Veit explained that the
building and labor costs did ot include office space finish
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IDC Minutes
2/21/91
costs or mechanical and e1ectr'cal/air condition costs. Ms.
Veit assumed a lease tenant fi ish which gives the tenant the
option to finish the project to he tenant's specifications and
at a possible lower cost. Mr. elstring advised Ms. veit that
the lease tenant finish costs must be figured into the TIF
budget as the use of TIF is not a benefit to the developer and
must be reflected in the TIF P an as a lease cost
reduction.
The following TIF schedule was set:
HRA meeting/review of plan
Distr of Plan to Cty & Schl
City Coun Call for Pub Heai
Plan comm/Comp Plan review
City Coun Hold Pub Hear
March 6, 1991
March 7, 1991
March 11, 1991
April 2, 1991
April 8, 1991
Results of the meeting were for Mr. Pelstring to receive actual
construction costs from Shingo ee for TIF Plan. Shingobee was
to obtain a land option commitm nt to coincide with the request
for proposal life duration, to upply Mr. Pelstring with actual
construction costs, and to hav building and site plans to the
Building Inspector for revi w prior to the HRA meeting.
Koropchak was to bring suggest d modifications back to the IDC
and HRA for approval prior 0 drafting a letter of intent
between the IDC and Shingobee.
After discussion by the IDC, Harvey Kendall made a motion
recommending an addition to th above second modification: The
life duration of the request f r proposal shall terminate upon
execution of the developmen contract during construction
season 1991. If the develo ment contract is not executed
during construction season 199 , the request for proposal shall
receive automatic renewal w'th a not to exceed the state
buildin cost index inflation rate subject to HRA request for
wi thdrawal. The motion fur her stated that a copy of the
revised letter of intent be ma led to IDC TIF/SPEC subcommittee
for review and approval pr or to submittal to Shingobee
Builders, Inc. John Mcvay s conded the motion, and without
further discussion passed una imously.
6.
CONSIDERATION OF PROSPECT
a) 1.2 million sq ft distribution center - Koropchak informed
the IDC members that Mr. Towe s of the Depart of TED telephoned
of the out-of-state represent tives scheduled returned visit to
Minnesota on February 14th. Plans were for a Monticello 7:30
AM meeting of predetermined ity officials with an agenda to
include infrastructure develo' ment plans including annexation,
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IDC Minutes
2/21/91
proposed land uses or zoning s rrounding the designated sites,
and available labor force info mation. The given meeting time
was outlined to end at 9:00 fo lowed by a tour of the proposed
sites and a tour of the ci y. Upon arrival and at the
beginning of the meeting the representative spokesman noted
that their time schedule was hanged and departure time from
Monticello was 9:00. Also, t ey informed the city officials
that their selected site in! Monticello was the Kjellberg
property. City staff having ompleted preliminary work with
the City Engineers and City lanner for the infrastructure
developments presented the pI ns accordingly. All requested
information was presented to the company and the meeting
concluded with the knowledge of an annual tax savings of
approximately $230,000 with a onticello site selection.
Koropchak received word from Mr. Towers that the company's
decision was to eliminate Mon icello from the final list of
three Minnesota communi ties. The three concerns of the
Monticello site as indicated y the company representatives
were potential opposition f om an existing trailer park
directly to the north, proposed R-l zoning (single residential)
to the east, and proposed R-3 zoning (medium density
residential) to the west. Sec ndly, was the concern that the
proposed infrastructure develo ments including annexation could
not be completed in compliance ith their time frame. Thirdly,
was the concern of an avai able labor fo'rce. Koropchak
mentioned to the IDC that the community Profiles of Owattona
and Faribaul t both indicated wages at a lower level than
Monticello, however, their ave ,age annual unemployment rate was
lower than Monticello. Owaton a also indicates an industrial
park of 400 acres with full services available. Koropchak
indicated she had responded t their concerns via a letter.
Mayor Ken Maus said, "It's a feather in Monticello's cap to
have been considered as one of the final three Minnesota
communites."
b) Aroplax - On January 2lt, Mr. Pelstring met with Jerry
Schoen and explained the finan ial package and the process for
application. On January 31t', Deb Gustafson, Bob Heck, and
Koropchak met at Aroplax's cur ent facility off North Penn and
Chestnut to detail required in ormation needed to complete the
SBA, TIF, and GMEF loan packag . The company was encouraged to
obtain a land option commi tt' ent. Gustafson and Koropchak
toured the company's current acility and Koropchak expressed
the interest of the IDC Promo ion Subcommittee to visit their
facility at their convenience. Plans are to have the SBA
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IDC Minutes
2/21/91
application completed and to tie OMNI Board the first week in
April. The company is interesed in the westerly 408 feet of
Lot 3, Block 2, Oakwood Industr al Park. The lot along Chelsea
Road across from the Tire Serv ce Equipment Mfg company.
c) Circuit Technologies, Inc - Having met with local lending
institutions and receiving no 1; cal endorsement of the project
concept, along with no revised rojections as suggested by Mr.
Pel string (reduction in sales and slow growth of employment
which are more realistic for. a start up company), and the
difficulty to obtain letters of:interest from potential clients
have caused the city to withdra the use of the GMEF. However,
the company has been encourage to have their business locate
in Monticello.
d) Woodcraft Industries, Inc - fter meeting with the company,
Koropchak proceeded to inquir of the availability of the
Hoglund property and contacted ahlheimer's for description of
their lot and road easement eading to Cty Road 118. Mr.
Pelstring having received no i formation for development of a
financial package, Koropchak called the company and was
informed that the St. Cloud HRAoffered to purchase Woodcraft's
existing fifteen acres adjoinin their current facility at the
intersection of Highway 23 and Highway 10. The St. Cloud HRA
would purchase the commercial ite and sell the property back
to Woodcraft for $1.00. John cVay advised the committee he
had heard the assistance was $ ,000,000.
e) Clark Associates - Mr. Pels
plan for the company who manu~
car wash machinery. Wi th th
Pelstring advised against a
Pel string further advised that
restrictive than in the past
looking at outlining commu
development and willing to ris
caution.
ring has reviewed the business
ctures "touch free" automatic
loss of sales in 1990, Mr.
sisting this company. Mr.
ith the commercial lending more
more start-up companies are
i ties hungry for economic
dollars. This only a word of
7. CONSIDERATION TO DISCUSS THE H CA PAYMENTS CERTIFIED FOR THE
CITY OF MONTICELLO AND THE EFF CT OF PROPOSED TIF PROJECTS.
Koropchak informed the IDC that the City of Monticello has been
certified to receive $246,646. in Homestead and Agricultural
Credit Aids (HACA) in 1991. Th s has caused a reduction in the
projected 1991 tax capacity ra e from approximately a little
over 17% to 15.511%.
Page 6
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IDC Minutes
2/21/91
Given an assumption:
EMV of building and land, 600,000.
Annual City HACA, $240,000
Economic TIF District, col ectible 8 years.
Penalty life of district.
Effect of Proposed TIF project
Annual estimated total inc ement, $22,900.
Annual TIF Penalty, $6,9001 (annual HACA reduction).
Annual "Net" Increment, $1, ' 000.
The question becomes who pays or the annual TIF penalty which
will recapture the funds tak n from the city general fund.
More information will be pr sented as staff becomes more
familiar with HACA and its penalty. Above numbers were
provided by Business Developme t services, Inc.
The IDC was reminded of the re ular Chamber meeting this noon
at the American Legion.
8. OTHER BUSINESS.
9. ADJOURNMENT.
. The IDC meeting adjourned at 8:50 AM.
~ Y:-..<i\ ~ J-.~
Ollie Koropchak, IDC Executive Diector
I
Page 7
. COMMUNITY PROFIL COMPARISON
CITY ANNUAL CAPACIT OCCUPATION MEDIAN
BUDGET AVERAGE RATE WAGE
POPULATION UMEMPLOYMENT P/H
Big Lake 6.0% 95.345% Carpenter $ 9.68
$925,000 Welder $ 8.81
3,073 Machine Worker $ 8.27
Clerical $ 5.59
Sales Clerk $ 5.15
******* **
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Buffalo 5.0% 86.370% Skilled Labor $ 9.06
$1,500,727 Construct. Trades $ 8.27
6,084 Factory $ 7.28
Health Care/Nutr. $ 6.80
Services $ 5.65
Retail Trade $ 5.53
Unskilled Labor $ 5.00
Clerical $ 4.88
******* **
Ck River 6.0% 97.145% Tool & Die $14.02
. ,417,150 Tech. Specialist $ 9.01
9,701 Machine Operator $ 7.97
Handler/Laborer $ 7.37
Clerk Typist $ 6.66
Services $ 5.50
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Faribault 4.1% 107.555% Punch Press Opr $ 9.21
$13,000,000 Machinist, Maint. $ 9.21
16,244 Mechanic, Machinery$ 9.12
(1989) Machine Operator $ 7.20
Delivery Person $ 7.00
Assembler $ 5.90
Cashier/Teller $ 5.13
Cannery Worker $ 4.74
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Melrose 5.2% 95.2630% Machinist $12.44
$5,429,546 Electrician $16.45
2,542 Laborer/Food Proc $ 7.74
Carpenter $13.04
, Clerk $ 6.17
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.onticello 5.0% 81.843% Sales $18.65
5,443,370 Managerial $17.30
4,291 Technical $13.22
Machine Operator $10.58
Clerical $ 7.21
Handler/Laborer $ 5.53
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New Brighton 3.8% 101.903 Tool & Die Maker $15.79
$11,500,000 Comb. Mach. Tool Op$13.03
22,798 Machinist, Maint. $12.99
Welder $11.25
Punch Press Opr $10.88
Assb, Ese. Elect. $10.74
Electr. Assembler $10.03
Secretary II $ 9.79
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Owattona 3.4% 106.942 Tool & Die $11. 15
$7,600,000 Draftsman II $ 9.80
19,017 Welder $ 9.59
Senior Secretary $ 9.10
Drill Press Opr $ 9.13
Machine Operator $ 8.43
. Assembler $ 6.52
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St. Cloud 5.0% 106.778 % Equip Opr, medium $11. 15
$30,660,000 Welder $ 9.98
45,322 Laborer $10.27
Word Processor $ 6.54
Clerk II $ 7.06
Assembler $ 8.25
Data Entry Keyer $ 5.85
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CITY
Big Lake
Ind Park
Devel Corp
Buffalo
2nd Addit.
Devel Corp
eentennial
Elk River#1
Elk River
Associated
Investors,
Inc.
.~D :ITE.COM
....~~ 14 91
ACRES
AVAILABLE
20
4
33
140
INDUSTRIAL SITE COMPARISONS
OWNER
OPTION
HELD BY
SERVICES
none listed
elect
gas
stor sewer
san sewer
pay roads
curb & gut
water
no
********'***
HRA
elect
san sewer
gas
stor sewer
trt water
curb & gut
pay roads
rail
san sewer
elect
stor sewer
gas
curb & gut
pay roads
no
HRA
no
******** ***
Assoc. Inv.
rail
san sewer
elect
pay roads
gas
trt water
stor sewer
no
******** ***
.ew Brighton
righton 28 ? no same
Corporate as
Park above
******** ****
Owatonna
Owatonna 186 no rail
Industrial a san sewer
Parks elect
stor sewer
gas
curb & gutt
trt roads
pay roads
******** *****
St. Cloud
Industrial 49.34 yes rail
Center West san sewer
elect
pay roads
gas
trt water
eundial 34.55 Miller no rail
est Proper ies san sewer
elect
stor sewer
gas
curb & gutt
trt water
pay roads
******** ******
'NO SITE.COM
.-3-14-91
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MONTICELLO AVAILABLE INDUSTRIAL SITES
Oakwood Industrial Park:
Zoned 1-2 (Heavy Industrial)
Lot
Lot 7, Bl
Easterly
Lot 2, Bl
Lot 3, Bl
Total Oakwood Partnership
HRA:
Zoned 1-2
Lot
Oakwood Industrial Park
Second Addition:
Zoned 1-2
First Right of
Refusal
Lot 1,
Lot 2,
Lot 3,
Lot 4,
Lot 5,
Lot 6,
Total 2nd Addition
Total Oakwood Industrial Park
****** ***
Lauring Hillside Terrace:
zoned 1-1 (Light Industrial)
Lot 5, Bliock 2
Lot 9, Bljock 2
Lot 10, lock 2
Lot 11, lock 2
Lot 12, lock 2
Lot 13, lock 2
Total Lauring Hillside Terrace
2 5.3 acres
2 5.2 acres
1, Block 3 2.69 acres
3 4.4 acres
3 4.4 acres
21.99 acres
6.42 acres
1
1
1
1
1
1
1. 21 acres
1. 36 acres
1. 92 acres
2.32 acres
1. 78 acres
1.48 acres
10.07 acres
38.48 acres
2.38 acres
2.32 acres
2.23 acres
2.15 acres
2.06 acres
2.43 acres
1.86 acres
15.43 acres
TOTAL PLATTED INDUSTRIAL LOTS AVA LABLE 53.91 ACRES
I
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Services: gas, electric, treate water, sanitary sewer, storm
sewer (Oakwood Industrial Park, natural drainage ditch), paved
roads (Oakwood Industrial park, 10 ton except Fallon Avenue 7-ton,
and East 7 street, 9~ton).
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Hoglund Site:
Zoned I-I
72.5 acres
Services: Treated water to east end of East 7 Street and along
County Road 118. Sanitary and stom sewer to east end of East 7
Street. No roads and unplatted lots.
******* **
Farm Credit Site:
Zoned I-I
Lot 10
Lot 19
25.82 acres
40.00 acres
65.82 acres
Total Farm Credit
Services: Treated water along Chelsea Road (three stubs) and a
cross at every 300 feet. Sanitary ewer along Chelsea similiar to
treated water availability. Chel ea Road 10-ton and unplatted
lots.
TOTAL INDUSTRIAL UNPLATTED LAND AV ILABLE
138.32 ACRES
192.12 ACRES
TOTAL INDUSTRIAL LAND AVAILABLE
********'***
Farm Credit Site:
Zoned B-3 (Highway Business)
Lot 11
Lot 17
Zoned B-2 (Limited Business)
Lot 18
15.15 acres
15.51 acres
40.00 acres
TOTAL BUSINESS ZONED LAND AVAILABL
70.66 ACRES
montind.sit
3-15-91
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City of Champlin
Land donated.
City forgave assessment
Sewer was in.
City completed sewer, and put
TIF District.
Selling Price of Lots:
location and market.
of approxima ely .50~ per square foot against property.
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waternd roads in through monies of an existing
$1.50 to $3. 0 per square foot subject to frontage
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