IDC Minutes 06-20-1985
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MIN~TES
MONTICELLO INDUSTRIAL DEVELOPMENT COMMITTEE
June 20, 198 - 7:00 A.M.
Monticello City Hall
Members Present: Tom Eidem, Arve I rimsmo, Shelly Johnson, Harvey
Kendall, Dale Lu gwitz, Chair Jay Morrell,
Bud Schrupp, Don Smith, Vice-Chair Gary Wieber,
and Allen Pelvit.
Chair Morrell opened the meeting asking for approval of the 5/16/85
minutes. Dale Lungwitz moved to a prove said minutes, was seconded
by Shelly Johnson, and passed 10-0.
The first item on the agenda was back to allow Tom Godlewski
and Gay Veit of Veit Construction to make their presentation
to the Committee. Allen explained his past attempts with Veits
trying to erect a spec building. e went on to describe the
property in this proposed project as Lots 1-10, Block 15, and
very briefly stated that the buil ing would be approximately
35,000 sq. ft. Allen stated that this item needed no action
taken and was informational only. He then turned the floor over
to Tom Godlewski.
.
Mr. Godlewski is a project manage for Veit Construction of Rogers,
Minnesota. He explained how over the previous 30-60 days they
have been negotiating with Mr. Ec on his property. The proposal
would be contingent upon obtainin the properties, correcting
the soils, obtaining the use of t x increment financing, and
so forth. Mr. Godlewski ran thro gh the properties costs, both
raw land and soil correction cost.
Chair Morrell asked for clarifica ion on a few questions and
then stated that the Industrial D velopment Committee does not
have any authority in the process.. He added that the Committee
did, however, have members on othr committees, councils, etc.,
and that might be beneficial for iding their cause. Morrell
stated that we could help find te ants, etc.
Shelly Johnson asked if the tenan
were compatible with the property
Mr. Godlewski assured him that it
on whether the 35,000 sq. ft. bui
tenant or more. Mr. Godlewski st
would be leased by one tenant, wi
for speculative purposes. He als
building was more workable than a
and nature of the business
and the appropriate zoning.
was. Chair Morrell commented
ding would be leased by one
ted that approximately 25,000 sq.
h the remaining 10,000 sq. ft.
stated that a 35,000 sq. ft.
25,000 sq. ft. building.
ft.
.
Arve Grimsmo stated that he felt
lessoning the value of a centrall
little uncomfortable with
located piece of property
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IDC Minutes - 6/20/85
by deducting the soil correction a ounts. He stated that the
Oakwood property sold for $3.00/s . ft., while others in the
nearby area went for around $2.75/sq. ft. He encouraged the
proposal but indicated to be care~ 1 on how it's handled. Chair
Morrell cautioned the developer a out MN/DOT's plans for improving
Highway 25 in 1986. Tom Eidem ex lained that since MN/DOT has
completed their plans for channelization and left turn lanes,
they would allow access to the pr erty from the 5~ Street point.
If 6th Street is constructed, MN/D T will only allow access/egress
from 6th Street. Morrell then em hasized the necessity to plan
their entrances/exits from the pr posed 6th Street. Eidem explained
that staff felt the first tax inc ements should be applied toward
the construction of 6th Street wi h additional increments possibly
to cover sewer improvements and fOnally land write down.
Mr. Godlewski asked about the pos
Cities Development Grant/Loan tha
Tom Eidem explained that this was
allowed only one application per
application will be used for anot
these programs are on a competiti
.
- type of business
- number of new jobs cr
- addition to the City'
- private to public fin
- number of jobs create
ibility of obtaining a small
might be up to $250,000.00.
true; however, each city is
ear, and our present proposed
er project. Allen added that
e basis and stress the following:
ated
tax base
ncial ratio
/dollar, etc.
He stated that industrial/manufac uring businesses are considered
more favorable; and in a competitOve situation, this type of
proposal has not done well in the past. Eidem explained that
if the project falls through, the Veits could ask for assistance.
Vice-Chair Wieber asked Mr. Godle ski what their time frame was.
Tom Godlewski stated that perhaps 60 days could complete the
front end red tape with perhaps a September construction date.
Chairman Morrell summarized the p oject and stated that the IDC
appreciates getting involved in tie proposal; however, they must
proceed with meeting with the HRA and City staff. He also stated
that the Committee could assist t e developers in locating a
tenant for the speculative space nd additional financing alternatives.
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Mr. Godlewski asked if the city h
with proposals for the property,
and perhaps asked if tax incremen
Tom Eidem explained that in the 1
been the first to actually propos
increment financing. Others have
declined to pursue because of the
An additional property owner may
s previously been approached
een made an offer on the property,
financing could he utilized.
st three years, Veits have
a project and request tax
expressed interest but have
extraordinary expenses involved.
lso have complicated the situation.
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IDC Minutes - 6/20/85
At this point, Veits met with Tom Eidem, City Administrator,
and the Committee proceeded with heir meeting. The Committee
took the next few minutes to disc ss the proposal and its impact.
There was some concern about the umbers that were used. The
City's property would produce a g oss revenue of $95,900.00,
and with soil corrections $35,900.,00. The question to be answered
by the City is, is an unproductiv piece of swamp worth $36,000.00.
Allen stated that this entire pro
of tax increment financing. Beca
of the property and the extensive
would be eligible for a 25-year T
that it was staff's feeling, as
tax increment not be used for lan
use for the increment would be to
such as 6th Street construction a
is tax increment remaining, then
toward the land cost. To apply i
write down would be contrary to t
osal is dependent on the use
se of the unproductive state
improvements needed, the area
x Increment District. He added
ell as the HRA's, that the
write down. The appropriate
cover the cost of improvements
d sewer construction. If there
erhaps it could be applied
crement initially to the land
x increment laws.
The rest of the discussion ed itself with problem areas
in the construction areas, lot, street construction,
Highway 25, and drainage. lly Johnson, Superintendent
of ISD #882, discussed the school district's concerns on using
tax increment financing and state that in this particular case,
he felt that tax increment financ'ng would be to the overall
advantage of the City. In establ'shing this Tax Increment Financing
District, we must meet certain cr'teria pertaining to blight,
etc., and will attempt to tie in ther properties like Clifford
Olson's for future redevelopment.
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In other business, Chair Morrell
a thank you letter to all banquet
that we send letters next year pr
Harvey Kendall so moved, was seco
unanimously. A discussion was he
from the banquet. Allen stated t
$7,100.00 this year. It was the
have Committee members sell the r
sales people sell those who were
This should be on the July agenda
The next meeting is scheduled for
River Inn. There being no furthe
adjourned.
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Allen L. Pelvit
Director of Economic Development
uggested Allen and Jay prepare
contributors. He also suggested
paring them for the 1986 banquet.
ded by Dale Lungwitz, and passed
d concerning the net income
at we netted approximately
oncensus of the Committee to
gulars, but to have Don Smith's
tubborn or never bought before.
for further discussion.
July 16, 12:00 noon, at the
business, the meeting was
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