EDA Minutes 06-09-2021MINUTES
REGULAR MEETING - ECONOMIC DEVELOPMENT AUTHORITY (EDA)
Wednesday, June 9th, 2021— 6:00 p.m.
Mississippi Room, Monticello Community Center
Commissioners Present: Steve Johnson, Bill Tapper, Jon Morphew, Tracy Hinz, 011ie
Koropchak-White, Lloyd Hilgart and Jim Davidson
Staff Present: Jim Thares and Angela Schumann
1. Call to Order
Steve Johnson called the Regular Meeting of the EDA to order at 6:00 p.m.
2. Roll Call
3. Consideration of additional agenda items
None.
4. Consent Agenda
a. Consideration of Approving Regular Meeting Minutes — May 12, 2021
Recommendation: Approve Regular Meeting Minutes — May 12, 2021.
b. Consideration of Approving Workshop Meeting Minutes — May 12, 2021
Recommendation: Approve Workshop Meeting Minutes — May 12, 2021.
c. Consideration of Approving Payment of Bills
Recommendation: Approve Payment of Bills through May.
d. Consideration of Resolution #2021-06 approving TIF Pre -Application Supportin
Affordable Housing TIF District for a 59-unit Multi -Family Low Income Housing
Tax Credit (LIHTC) Affordable Housing Proposal by Duffv Development
Recommendation: Adopt Resolution #2021-06 expressing support for the
proposed use of TIF for a LIHTC multi -family development by Duffy Development
Company, Inc.
e. Consideration of Resolution #2021-07 Extending Lease Agreement Between the
Citv of Monticello Parks Department and the Citv of Monticello EDA for 349
West Broadway
Recommendation: Approve Resolution #2021-07 extending the lease agreement
between the City Parks Department and the EDA for property located at 349
West Broadway for an additional 15 months, to August 31, 2022.
Economic Development Authority Minutes —June 9th, 2021 Page 1 1 5
f. Consideration of Resolution #2021-08 Authorizing EDA to Enter into
Preliminary Development Agreement with Deephaven Development in
Connection with Block 52
Recommendation: Adopt Resolution #2021-08 authoring entering into a
Preliminary Development Agreement (PDA) with Deephaven Development, LLC
or its assigns in connection with the EDA's redevelopment goals and visions in
Block 52.
Regular Agenda
5. Consideration of Pre -Application for GMEF Loan from Cory Kampschroer for Proposed
Car Wash Development Proposal
Jim Thares explained that a pre -application for GMEF loan was received at the City for a
proposed car wash development estimated at about $4,100,000. The proposed location
is 1301 Cedar Street. Thares explained the proposed car wash facility and noted that an
estimated 4 to 6 jobs would be created. The applicant is seeking a $100,000 GMEF loan
to fill a $400,000 funding gap. The project developer is also talking to other lenders to
help close that gap.
Lloyd Hilgart asked if the estimated costs were over $4 million, how the site would only
have a value of $1 million or less. Thares noted that the pre -application indicates a
building costs are $1.8 million. Thares explained that some of the numbers may be a
little fluid and the applicant would be asked to come back with more precise numbers.
Bill Tapper asked what off site development costs included.
Cory Kampschroer explained the background of the project and noted that the total
project costs are anticipated at $4 to $4.5 million. Broadly speaking about the costs,
about $1 million is for equipment, $2 million for construction, and the rest for land or
soft costs for development.
Tapper asked how the developer would establish priority for the four investors in the
project. Kampschroer confirmed that there are some personal guarantees and other
assets such as Wright County EDA, the Initiative Foundation, a bank, and SBA. Thares
stated that the EDA's loan program does require personal guarantees and they prefer to
have second position.
Steve Johnson asked if this project has gone through underwriting analysis.
Kampschroer indicated it is in progress and there is a feasibility study underway.
Johnson asked if it would make sense for the EDA to complete an independent
feasibility study or underwriting study or if it would be sufficient to use Kampschroer's
independent study. Thares stated it might be possible to utilize the SBA lenders analysis
Economic Development Authority Minutes —June 9th, 2021 Page 2 1 5
though it will be dependent on the primary lenders approach to that question.
Tapper asked Kampschroer if he has completed a needs analysis due to the location of
existing car washes. Kampschroer indicated that the particular model of car wash is
unseen in the City. It focuses on convenience, quality, and experience. Hilgart asked if
they could view renderings. Kampschroer indicated that he would send those along.
Johnson asked EDA members is they were comfortable with the independent
underwriting required by SBA for this project. Other members responded that they were
comfortable following the SBA's independent analysis.
Johnson also asked the applicant if he was comfortable submitting the ancillary
documents from the checklist for the GMEF loan. Kampschroer confirmed.
Tracy Hinz asked if the applicant has operated other car washes. Kampschroer indicated
that his first job was at a car wash, but that the car wash industry has changed since that
time. He indicated that he is continuing to do his homework to ensure it is a successful
operation.
Hilgart assumed that the EDA would not go any further besides this first step unless
there are approvals at the County and Initiative Foundation. Thares confirmed. Hilgart
was concerned with the amount of time spent on the project if the other two lenders
would not approve. Hilgart asked if the City can wait for the other two lending approvals
and how quick the EDA can complete the lending process through GMEF. Thares felt the
timeline could be done fairly quickly if all the required information is provided by the
applicant.
There was consensus by the EDA to accept a full application for GMEF.
6. Consideration of Update - Monti Arts Program Use of EDA Owned Properties — Sue
Seeger
Sue Seeger provided a report on the MontiArts Initiative. The arts program has been in
place since the spring of 2018. To date, the program has received 16 grants totaling
nearly $92,000. Seeger discussed how the arts program has utilized both EDA properties
located at 349 West Broadway and 101/107 Broadway. The EDA members expressed
appreciation for the update.
7. Consideration of EDA Authorization for Lease Termination of Billboard Sign Leases on
EDA-Owned Land along 71" Street West — Outlot A, Country Club Manor
Jim Thares explained the item was an update regarding the lease termination of
billboard signs on EDA owned land along 7t" Street West. The parcel contains four
billboard sign leases which were approved by the City Council several years ago. Thares
Economic Development Authority Minutes —June 9th, 2021 Page 3 1 5
noted that the City would be providing notices to the billboard companies that their
leases would be terminated due to multi -family development proposals for the site. A
concept proposal of the multi -family development would be reviewed at the EDA's
regular meeting on June 23, 2021. The City Council would consider approving the lease
termination notices at their upcoming meeting. Thares explained that although the land
is owned by the EDA, the City of Monticello entered into the leases with these billboard
companies. The land was previously tax forfeit and conveyed to the City of Monticello
many years ago. The City then transferred the land to the Monticello HRA and the then
the HRA transferred the property to the Monticello EDA.
011ie Koropchak-White asked if the lease money has been going to the City or the EDA.
Thares confirmed that the City is receiving the lease payments.
8. Consideration of Authorizing Cedar Square Site Development Timeline and Developer
Review and Selection Process
Jim Thares noted that over the past several months, staff have been receiving inquiries
of interest from developers regarding EDA properties (in particular, the Cedar Square
site). The site is 1.39 acres and is listed on Costar at $389,000. Thares explained that
staff have had multiple meetings with a developer who are interested in completing a
multi -family development (apartments). Recently, two developers have submitted
concept plans and letter of interests. Staff is looking for direction from the EDA on the
property and the development requests for the property.
Jim Davidson asked for the intended use in the Monticello 2040 Comprehensive Plan.
Thares noted the Small Area Study shows the land as residential.
Tracy Hinz asked for clarification on the direction that staff needed to move forward.
Thares explained that the concept sketches matched what was provided in the Small
Area Study. The EDA explained that they were not excited for an apartment complex.
011ie Koropchak-White asked if the developers were not interested in townhouses.
Thares noted that he provided a townhouse sketch completed by Anderson Engineering
to the developers, but neither were interested in such use.
Thares noted that the EDA could post a request for qualifications with the sketch
completed by Anderson Engineering attached to it.
It was understood that at this time there was no interest in an apartment building at this
location. Due to current interest in development and a variety of projects happening
throughout the City, there was not a rush to sell the land, but the EDA would be open to
entertaining a concept that was similar to the sketch provided by Anderson Engineering.
Economic Development Authority Minutes —June 9th, 2021 Page 4 1 5
9. Economic Development Director's Report
Jim Thares provided the Economic Development Director's Report as provided in the
agenda.
It was noted that the marketing videos would be included on the City's new website and
could be integrated into Costar Loopnet listings. In addition, these links could be sent to
prospective buyers.
Bill Tapper explained that he would be resigning from the EDA effectively immediately.
OLLIE KOROPCHAK-WHITE RELUCTANTLY MOVED TO ACCEPT THE RESIGNATION OF BILL
TAPPER ON THE EDA. TRACY HINZ SECONDED THE MOTION. MOTION CARRIED, 7-0.
10. Adjourn
TRACY HINZ MOVED TO ADJOURN THE MEETING AT 7:19 P.M. LLOYD HILGART
SECONDED THE MOTION. MOTION CARRIED, 7-0.
Recorder: Jacob Thunander ir
Approved: July 14th, 2021
Attest:
res, Economic Development Director
Economic Development Authority Minutes —June 9th, 2021 Page 5 1 5