EDA Minutes 04-29-1997
.
.
.
MINUTES
MONTICELLO ECONOMIC DEVELOPMENT AUTHORITY
Tuesday, April 29, 1997 - 7:00 p.m.
City Hall
MEMBERS PRESENT:
Chairperson Ron Hoglund, Vice Chairperson Barb Schwientek,
Assistant Treasurer Ken Maus, Clint Herbst, Roger Carlson, and
Darrin Lahr.
MEMBER ABSENT:
Bill Demeules.
STAFF PRESENT:
EDA Treasurer Rick Wolfsteller and Executive Director
Koropchak.
GUESTS:
Mayor Bill Fair
Rusty Fifield, Ehlers &Associates, Inc.
Kevin Doty, Marquette Bank.
I. CALL TO ORDER
Chairperson Hoglund called the EDA meeting to order at 7:00 p.m.
2.
CONSIDERATION TO APPROVE THE FEBRUARY 1 1,1997 EDAMINUTES.
Roger Carlson made a motion to approve the February I I, 1997 EDA minutes. Clint
Herbst seconded the motion and with no corrections or additions, the minutes were
approved as written.
3. CONSIDERATION TO REVIEW THE 1997 CITY PRIORITIZATION LIST.
Koropchak informed EDA members that three property owners and one potential lessee in
addition to Bill Grassel of Domino's Pizza have contacted the City on the availability of
fmancial assistance to rehab the interior or exterior of their downtown retaillcommercial
buildings. Of the prioritization list under development by the City Council, currently, both
"establishment of a commerciallretailloan" and "store front redesign/revolving loan fund"
were ranked in the top 35 out ofa possible 121 projects. At this time; however, the
Council has not finalized the prioritization list. Two projects earmarked by the EDA were
"explore to establish a commercial/retail revolving loan program" and "explore to establish
a redevelopment loan! grant".
1
.
.
.
EDAMlNUTES
APRIL 29, 1997
Adoption of the Downtown and Riverfront Revitalization Plan as part of the Monticello
Comprehensive Plan by the City Council is anticipated to take place in June or July. The
process will include approval by the HRA followed by a public hearing of the Planning
Commission, this prior to council adoption.
4. CONSIDERATION TO DISCUSS FUNDING OPTIONS FOR REVIT ALIZA nON OF
THE DOWNTOWN AREA. (RETAIL/COMMERCIAL LOAN PROGRAM).
Koropchak introduced Rusty Fifield of Ehlers & Associates, Inc., the financial consultant
firm for the HRA. Additionally, Ehlers & Associates is one of the team members ofthe
Hoisington Koegler Group, Inc. hired to study and prepare the plan for revitalization of
the Monticello Downtown and Riverfront area.
Rusty presented EDA members with a handout illustrating the framework for fmancing the
revitalization plan. The framework consists of two strong "anchors": the southern anchor
being the redevelopment of the mall and the northern being the development of a hotel or
some other type of massive development. The anchor developments financed by
developer's capital and TIF. It is likely the tax increments generated by these projects will
be consumed by the projects.
Within the revitalization plan, the area defined as "public" suggests the development of
public and civic facilities which are best financed through city or other governmental funds
continued Rusty. Next, the area defmed as "main street" is Walnut Street. The City's
budget of the next couple of years includes street improvements for Walnut Street.
Although some of the improvements are assessed to businesses, it is suggested TlF
revenues be used to enhance the street scape improvements. It was also suggested that a
Service District be established to maintain the improvements.
Lastly, the area defined as "revitalize" is along Broadway or the existing downtown area.
It is suggested this area be fmanced by TIF, developer's capital, and rehab loans.
Revitalize means to improve existing businesses and help new businesses. Revitalization
can be accomplished through development of fmancial programs tied to facade design
guidelines or functional codes or through gap financing to acquire properties. The
greatest use of money is with the facade design guidelines and functional codes.
Additionally, Rusty presented various approaches to loan programs assuming a $150,000
fund balance with interest rates ranging from 7.5% to 0%. The examples showed the rate
of return on the investment. Another approach was to write-off the interest rate of the
bank loan. With this approach, the out-lay is less; however, there is no money returned.
Another approach is a design grant for the public purpose of community benefit.
2
.
.
.
EDA MINUTES
APRIL 29, 1997
EDA members raised questions and made comments: Who gets the loan? How does one
prevent discrimination? Are loans for the owner or tenant? Are loans for new
construction or rehab? Retail/commercial loans have greater risk and exposure. Minimize
risk for practicality rather than politically. EDA reserve funds can stand behind a bank
loan as a pledge to the bank. Perhaps smaller loan amounts for smaller projects: loans for
signage such as in Big Lake. How best is the EDA money leveraged? For consistency of
the revitalization plan - projects must create people downtown, not just economics.
Rusty suggested sources of funding options for a retail/commercial loan or grant. Option
one being dollars from the City's Liquor Fund. Option two perhaps from existing EDA or
HRA funds. Lastly, sell bonds for rehabilitation; however, this option is the least cost
effective. A funding sum of$l 50,000 for a designated period oftime was suggested by
Rusty.
Koropchak informed members ofthe visit to Little Falls stating Little Falls gained national
preservation or historical status which allows owners to qualifY for historical tax credits
which serve as an attractive incentive. Additionally, rehabilitation has been funded
through Small Cities Grant money, a city low-interest loan, and developer's capital. The
city has the right to obtain easements of the exterior walls of downtown buildings which
the city than rehabs consistent with the design standard guidelines. Owners must maintain
the exterior walls according to the guidelines. Lastly, the city has worked with MDOT in
a shared-cost arrangement relating to funding of street lights and banners along the
proposed improvements ofthe state highway running through downtown (main street).
Barb Schwientek made a motion authorizing staff and the consultant to proceed with
research and gather of information for the potential development of a retail/commercial
funding program. Fifield to provide examples of funding criteria or guidelines from other
communities and Koropchak to invite the downtown property owners interested in
rehabilitation to the next meeting. Darrin Lahr seconded the motion and with no further
discussion, the motion passed unanimously.
General discussion continued as to whether the community buys into the concept ofthe
revitalization plan and will it work?
5. Other Business
Mayor Fair informed EDA members that council members continue to work on the
prioritization list which will lead to the establishment of policies and values - what we are?
EDA members were encouraged to give input to the City Council and present budget
request in July. The next Council/Staff meeting is scheduled for May 13.
3
.
.
.
EDA MINUTES
APRIL 29, 1997
EDA members established Wednesday, May 28, 1997, 7:00 p.m. as the date ofthe next
meeting.
6. Adjournment.
Clint Herbst made a motion to adjourn. The EDA meeting adjourned at 9:00 p.m.
CJ~ \<CI\~~~
Ollie Koropchak, Executive Director
4