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IDC Agenda 09-04-2007AGENDA MONTICELLO INDUSTRIAL DEVELOPMENT COMMITTEE Tuesday, September 4, 2007 - 7:00 a.m. Bridge Room, 505 Walnut Street, Monticello, MN MEMBERS: Chair Mike Benedetto, Vice Chair Bill Tapper, Mary Barger, Dick Van Allen, Don Roberts, Dan Olson, Barb Schwientek, Lynne Dahl-Fleming, Don Tomann, Jim Johnson, Zona Gutzwiller, Patrick Thompson, and Patty Haiby. STAFF: Ollie Koropchak and Angela Schumann. COUNCIL LIAISON: Mayor Clint Herbst and Council Member Wayne Mayer. IDC MISSION STATEMENT: To increase the industrial tax base, to create jobs at liveable wage-levels, and to maintain a favorable and desirable industrial environment in the City of Monticello. 7:00 a.m. 1. Call to Order. (Please read the minutes and information prior to the meeting. 7:05 2. Vote to approve the August 7, 2007 IDC minutes. 7:08 3. Follow-up Business or Reports: A. Comp Plan Update. 7:15 4. City Council Update A. YMCA property. B. Fiber Optics Network. C. 2008 City Budget 7:25 5. Old Business. A. Recommended role of the IDC -presentation by O'Neill. 7:35 6. New Business: A. History of the IDC - Koropchak. B. Members to consider options as to the role of the IDC. 7:50 7. Reports: A. Economic Development Report. 8.00 8. Review the draft copy of the September 4, 2007 Planning Commission Agenda for industrial related items. Discuss and vote on an IDC position or action if necessary. No industrial related items on September 4 agenda. 8:10 9. Other Business. A. Chamber Updates -Haiby B. Next IDC meeting -October 2, 2007. C. Other business. 8:20 10. Adjournment. 1 IDC Agenda - 09-04-07 6. Economic Development Report: a) Fiber Optic Education Committee -This group is meeting weekly and most recently prepared the second educational newsletter for mailing on September 6 and for one-on-one delivery to the businesses beginning the week of August 27`h. A grass-roots committee has been formed within the community. b) HRA/EDA consolidation -The EDA commissioners made a list of recommendations on the merger and agreed the HRA should transfer its powers and assets to the EDA. A workshop with council members and the HRA/EDA attorney is being planned for September 24 prior to the regular council meeting. The recommendation of the EDA was for a seven member commission consisting of two council members and five non-council members. They recommended that at least three non-council members be residents of Monticello and not more than two non-council members can be anon-resident but must own a business and real estate property in the City of Monticello. The Council will need to decide on their appointment process for selection of commissioners and its organizational structure. c) Clear Channel has agreed to let us hold off on the submission of the billboard design until after the referendum of September 18. The Marketing Committee will meet to create two billboard designs so we are ready to submit our design on September 19. Our billboard message will be displayed beginning October promoting Monticello for industrial development (promoting land and fiber). • d) A meeting date has been confirmed for September 14 at 9:00 a.m. to visit the Anoka- Ramsey Community College. The purpose of this meeting is to explore the potential of Monticello establishing a facility or campus for continuing education. This was a result of an idea out of the Feasibility Study presentation by SCSU on bio-science. Those who will attend are Senator Koch; Mayor Herbst; Administrator O'Neill; Supt. Jim Johnson; High School Principal Doug Standke; Barry Kirchoff; Small Business Development Center, SCSU; John Burgeson, Dean of Continuing Education, SCSU; Don Tomann or Randy Hatch, UMC; and myself. We will meet with Rosie Mortenson, Dean of Continuing Education and Customized Training, Anoka-Ramsey Community College. It could be a wonderful partnership between government, education, and business. This meeting is to discuss the need and the how to. Education is key to development of job growth and the availability of a skilled labor force which results in household wages. e) Industrial Real Estate and Industrial Development Conference - I attended this half-day session on August 22. The Cities of Norwood-Young America, North Branch, and Cambridge and Wright County were panelists on one of the sessions: Industrial & Business Park Outlook. I had been asked several times to be on this panel but declined as was not the right year. Other sessions included Western Wisconsin Real Estate Opportunities, Critical industrial and economic development legal issues, client expectations in site selection and evaluation, advanced strategies for site investigations and evaluations, and industrial real estate outlook 2007/2008. I'll talk more about this in the History of the IDC. • IDC Agenda - 09-04-07 f) * Received a Transformation Home Loan application. * Called several general contractors -network. * Owners of the AV Store will respond to the HRA either by mail or attend the September 12 meeting. g) Walker In-Store -Their building application has been submitted and I e-mailed Brian to let me know the ground breaking date so I can get a few pictures and invite a few people. The contract states thirty days from closing date (July 31) to commence construction. h) Business Retention and Expansion (BRE): * Had lunch with Bob Viering, First Minnesota Bank. * Visited Mike Pudil at WSI and toured the facility. He showed me three large pieces of equipment recently purchased at an investment of nearly $2 million. They are very busy and increased production through a contract with the oil industry. * UMC honored -Received the 2007 Secretary of Defense Employer Support Freedom Award for providing exceptional support to employees serving in the National Guard and Reserve. Star Tribune, August 27. Congratulations! * Washburn Computer Group was approved fora $275,000 rehabilitation loan by the Monticello EDA. The loan is for the proposed 30,000 sq ft addition to the current facility, disbursement is subject to lender financing and contract award with new customer. * Both WSI and Washburn noted that their companies were kept well-informed by the project • manager during construction of the Chelsea Road improvements in that area. * Sunny Fresh Foods - It was such an honor to speak to the McMillan and Cargill families on August 7`~. Big Lake Mayor Don Orrock and myself each spoke during the luncheon held at the Cargill facility in Big Lake. My role was to speak on Sunny Fresh's history as a corporate citizen in Monticello. It was interesting to be among Cargill board members and family members ranging from a young age of high school students. I sense Cargill begins to groom family members at a young age by introducing them to Cargill products and visiting production sites. It was a valued experience. i) Comp Plan Update: Since Rusty was on vacation, the schedule is pushed back. The revised copy of the Comp Plan is expected to be submitted to staff very soon (which includes the Economic Development Chapter and staff s comments). Staff is scheduled to meet with Rusty on September 10. j) LEADS: * 100,000-150,000 sq ft (2-3 story) office/tech use building - 10-20-100 acres. This is a major metro company looking for a site for one facility or perhaps a campus site. The real estate broker states the company hopes to have site control in 2007, construction in 2008, and occupancy in 2009. Fiber optics is a must. Furthest northwest location is Monticello, southwest location Shakopee, and west location Chaska/Chanhassen. General response 53 geographic location sites. • IDC Agenda - 09-04-07 ~ * 35,000 sq ft building, $3 million building, 5 acres, Plymouth company, Monticello furthest out. Outside storage required. Recommended Pfeffer property. * 1,800 sq ft to lease, mfg of computer systems for energy savings. Lead to Barger. * 5,000 sq ft to lease/purchase. Provider of cleaning systems 7 supplies specializing in laundry and warewashing. Mixes chemicals for cleaning products. Lead to Barger. INFO - In visiting with some of the general contractors who have constructed industrial buildings in Monticello, given the changes in technology and automation, and after consolidation of the HRA/EDA; the GMEF guidelines for number of jobs created needs to be re-evaluated. Perhaps using a point system for number of jobs, wage levels, etc. is a more equitable way. Also, other financing tools need to be reviewed and perhaps implemented based on goals.. Using the example of the office/tech use building and with limited detailed information, I'm not sure the HRA could offer the land for $1 per sq ft as it doesn't meet the statutory requirements of manufacturing, warehouse, or distribution for TIF. * Job Fair 2007, St. Cloud Area. See attached. * Newspaper articles attached. BUDGET 2008 -Since department heads were requested to submit a 2008 five-year budget, I submitted the following based on ideas/goals of the EDA/HRA/IDC. *Bio-Science/High Tech Investment Total $500,000 - $100,000 annually. *Job Training Campus Total $300,000 - $100,000 over three years *Downtown Redevelopment/Purchase Total $1,000,000 - $200,000 annually. * Continued Marketing Otter Creek Crossing - $20,000 2008 only. * Continued payments of the Otter Creek Crossing contract for deed and assessments. * Additionally, the HRA made a motion requesting $250,000 annually from the City for future acquisition of land for industrial development. Currently, the HRA is making the payments on the Otter Creek property and assessments so have no available cash to match city funds; however, they are committed to re-investing any gains from the sale of Otter Creek Crossing in the future. *The IDC had made a recommendation that the HRA and City annually make a matching fund contribution to build up funds for future acquisition of land for industrial development. * The EDA made a motion to make the final payback payment of $100,000 to the Liquor Store Fund for the purpose to reduce the 2008 city debt levy. Although the EDA was not obligated to return the initial appropriated Liquor Store dollars of $383,000; they willingly selected to do so. Knowing some of the above items are not approved goals and the dollars are estimated, it is important to note investments needed to accomplish economic development and comp plan goals. • EMPLOYERS! IT'S NOT TOO LATE........ i 11th Annual St. Cloud Area Job Fair 2007! (~ ~ V Thursday, September 20, 2007 ~ nuc i a zoo? ~ 1:00 AM - S:Ob PM St. Cloud Civic Center CITY OF MONTICELLO St. Cloud, MN u my $175_0 *Attended by over 2,000 job seekers!! Return the enclosed registration form by September 4, 2007 to have your information included in the employer directory.. If you have questions, call a Job Service Representative at 320/308-5320. *Advertised to the public throughout Central Minnesota! ! ! • Sponsored by: MN WorkForce Center St. Cloud Area Economic Development Partnership St. Cloud Times St. Cloud Area Job Fair 2007 Registration Form ~ontact Person: Please complete the following information to be included in an employer directory which will be given to the public. Only the information listed below will be included in the directory. Company: Address: City: State .Zip Phone• Fax• WEB Page-Internet Address: Description of Business: Career Opportunities: Desired Skills: Number of booths requested. ($175.00 per booth) We will need electricity. Yes _ No _ ($25.00) Total MAKE CHECKS PAYABLE TO: SCAEDP (ST. CLOUD AREA ECONOMIC DEVELOPMENT PARTNERSHIP) Mail to: St. Cloud Area Job Fair 2007 MN Workforce Center/Job Service P.O. Box 67 St. Cloud, MN 56302 Remember: You must return our registration form and,..payment by September 4.2007 if you want to be included in the employer directory NOTE: New phone numbers: Phone: 320/308-2929 FAX: 320/308-5173 • • .- °- << n ~~:. ~ ~ ~~ ~I I,I~~~III ~~ ~„ ~ ~~ e .r .~. . .r,. - -~ ~'' r ``' ' CONSI'RUC1`ION OF TWA new cdC~orate headquarters foi~,N~innesota L tnited a5" ~~ar Ct~ ~Rd.'14 iri Qig,~-aka 'T1Np fife company is one of the largest p~i~hne ackd lUiidwest gervin~ th~''r~atufal ~a~ and P~#roleum IndEiatryi w~~ c~?mpietet#~ the".ttivc facility will ~~c~use offices`," a maid#e~iance area,,` rNarehou$~ s~ ce#'ancF ,~"~~~ .fabr~G Francis)..- ~~ ~ j _ ~ ~ ~~, .. t FE` .. 't{ ., a3i~~n zj d"'$Y.~o .i~}i~,~~ lr i,'~:{. ',' 4 ~ ~~{~ ~ .. .. .. ..~ .~ ~. 5 .. '., ~- - ..._ .. `ter.. _. is well;urideryr~y ott'Hv+~ station:°cs~ntra~tors'in th -story 60,000 ~q'irare foi ~tion 'area. (Photo by Ke .; ~ VId,r r ,. t~' i # ~ i J j , ~,. E .. ,H ~.. . ~ ~ r,.~ 55 r,~ Kat'ert~Barta; "11V~ liav~.~s~ , ~ - ~:~~~, ;;~~~~FQ~re~;~Q~~l~a~al'~bi~~i°u~ss~s . th~.gtiesdhnsattc~~~tlae~dthe' ~;fx` ' *~ i' ~1DIA`iCadY~~~~" ~°'~"t'e~~DVed~;~?~~ts~`f~om.lun survey r~Sults:-~`f~e3rdport>l~a~drt3 :.,a.;Y~s~~~ .~j~~a~j Y~S~'~~°;:.r'~''tT~:~ste~rs~'an~~El~ia~l~teadifiha>~s~:`~' been co~nptled byu he red flag l~,sp~S, havu)S tP 41o vey!, ~ach.inproai~ d,~,[~=pro.}-- - ~, 1 -~ l~}it~i U,~tve~st~~+ 9~ ~ Iv>ii ~ nes~~a, ~ wt~l '.~r}at~c dal, prq~am az}d act ` wtll be desig~E an is ~} lanai z ntng, >aave~ e. e to observtn urabl~ E~t~~siori Off' ~e aixr~ ~ - P ;~ ~ ~},d ~ ,~ issues have rl2ee~ id~tlti y alZeac~~y er~"i~cen up with the , gtcomas. ~r 1s S i ,:. F ~tt>' f 1 } ~..~i .4 i'. y-<c~~ ~~ }1~k1~Q ~ie ~tee~ c€~~tt~ee ~as city., 2 X4'1 O ``~T„ V ~. v F C k lrElvu c` ide~f~f~ec~ ~our,;_~r~#~ect~ to. "VVe' have"been almost a E atch ,~ , ¢ ~; w r Q~ anc~,is ,gylsm laps year in the ~f~~ss ~o we r~~J~ b~~~ g~ e~, :~~id, , .g ~ ~ ~, ~, ~ , a;.- r tQ`add~ess ttioSe lss~le$ be ~,celebsating ouz ;one y~a7' e (l?~~k6it~.drd a r`~'he` headers' Feally ~S~rove;_ atuuv~rsar}~,'said ~ody{ q~t ~;.~f getting lhg~ Pro- , the process: They made it hap- ' 'I'11G comttiencement ce~e_ Q~8 's'he cotnn~tment pen," Said. ~xtens""ion. Office bration wild include, a pr~s~n or . a~'j~~ e~~'~'a~ ~cau~it Cottsultant Claudia ;Cody. tation qn the history 4f ` e u~'`'t¢ Eh7}9 ~~~~' `They committed then Vtiine, project, the outcoFnes and e ~~ConbASi~ u : ~41oP~~nt ~,.. ~ias energy and excitemept",for, tie selected strategies. The teams ~ .f~~tq~' -- j`Xtrt ~TeS . a belle, t Qf ttie community." of volunteers dealzr}$ with sped intt~ l~e~yltt ~ ~;o~~f f~ addition Cq tl~ four major each of the `issues, raised will tti~ project bn lieha~f of the ~ a~ts..tQ-f~ a`~d~e~sed.at the ' pt'~~~~~ k~®~ pro~ct~., ~ ~ ~ qty; ":. t~ ~{>~ , , ,,, ~, ~. e o , ~a rThe x ~~~. ' ~; enc~eme,~i~ tie ~eP4~ jt'~X'-,.~w~l° ~ ~.~, ~~1 ~ y ~ ~'. s ~'~~. en a ~ ih'i ortant,'t S ' i tut~~~~ed' ones;si~~ll~r; issue .~ participatory ~ g ~ P wf~e~. 'will lie; "addressed. merit,''said 13arta: _ "We want "Worth`'all the" tizYle' add efPo Some problems ,identified as: people to come and ]earn what, to. keep our community vi . • minneapolis-stpaulbusinessjournal.com ~- ~ _ ___ :~~: .~„~ ~ , ~r --~ ~.~~~e n ~_~-_ ,~. 4,, ._ ~` =' ,o-;, ~ ~ ~h"ia maY Padtlle electronics at renartred 767-3263 ext 130 for more information. August 17, 2007 Growing a zone: City pushes idea of 800-acre biotech park BY BRI6ITT NIAflTIN CONTRIBUTING WRITER The extension of highway 212 in Chaska is making more than 800 acres of land accessible for the creation of abiotechnology-focused business park. Upon completion, the Chaska Biotech Center is expected to bring as many as 10,000 jobs to the west end of the Twin Cities. Matt Podhradsky, the city's economic devel- opmentcoordinator, said Chaska is expanding on its existing strength as home to three of the state's top bioscience businesses: Lake Region Manufacturing lnc., Lifecore Biomedical Inc. and Beckman Coulter Inc. "The city wanted to use the highway 212 project as an opportunity to create jobs in the community," he says. "Biotechnology and the high-tech industry are already here, and we have the land, so we are taking advantage of Minnesota's Bioscience Initiative." The Minnesota Bioscience Initiative is designed to "help existing and startup bioscience compa- nieshave greater access to educational institu- tions and provide tax incentives to help them facilitate their growth." There iiitially were concerns about creating a park that competes MORE... with existing biosci- ence businesses for Size: 835 acres total, scarce qualified job 435 developable, candidates. According 400 parklands to Podhradsky, how- Cost: Est $21 million ever, the existing over four phases businesses "Said the Construction: Phase park may create com- onegroundbreaking petition but it also in spring 2008 will cluster industry Impact: Completed people in the western business park could .metro, making it easi- provide 8,000 to er to hire." 10,000 jobs ~ Podhradsky said the 835-acre site, which stretches from the in- tersection of highway 212 and County Road 10 to County Road 147, will have a capacity for 5.8 million square feet of brulding space on plots ranging from five to 50 acres. Phase one, which involves $2 million in infrastn~cture cre- ation and up to $2 million for road upgrades on 40 acres of the park land, will culminate in spring 2008. At that time, the city hopes to host a groundbreaking ceremony with the governor present. The city is unable to confirm any tenants in the park, but Podhradsky notes that medical industry, medical device and higher-educa- tion companies have shown interest in the Biotech Center. The concept plan includes space for a regional hospital, biomedical campus, biotechnology campuses, corporate campuses, a mixed-use business area, a hotel and entertainment complex, and a residential community. To market the business park, the city of Chaska is approaching businesses directly, ex- hibited at the Bio International Convention in Boston in May, andwill beattending amedical- device and manufacturing convention for the Upper Midwest in October in Minneapolis. Podhradsky said the city also is working with existing area bioscience businesses to create an official Bioscience Zone, in which the Biotech Center would be located. Bioscience Zones facilitate the development of research-and- development parks linked to the University of Minnesota and Mayo Clinic of Rochester, according to the Minnesota Department of Employment and Economic Development (DEED) Web site. "It is exciting to have local communities see the potential for this industry and dedicate re- sourcestoward building capacity for the region to grow," said Kevin McKinnon, DEED's biosci- ence and medical device industry specialist. DEED's Bioscience Business Development Public Infrastructtue Grant already has con- tributed $1 million toward the project's phase one infrastructure costs. So far, the city of Chaska does have at least one partnership with ahigher-education fa- cility -Hennepin Technical College (IIT'C) - promising to bring custom training in man- ufacturing and research access opportunities to the business park's tenants. In addition to training and research oppor- tunities, Podhradsky said park tenants will en- joy "access to state and tax incentives, some of the lowest taxes but best services in the metro, and an attractive, natural setting." He further adds that "souttrwest transit may develop a transit center" in the park for conunuters and residents, and that the city council's carefully defined concept plan will make applications for business-park tenancy straightforward. Dale Wahlstrom, CEO of the BioBusiness Alliance of Minnesota, said he feels the part- nership with IITC and other regional biosci- ence businesses helps position the. Chaska Biotech Center to succeed: "High-tech com- panies in Chaska that understand the chang- ing market, like Lake Region (Manufacturing), can help bring commercial interests into the Biotech Center discussion. To succeed, we be- lieve every project needs its champion, and it doesn't hurt to have private-sector people who can help your cause along, too." Brigitt Martin is based in Burnsville. NANCY KUENN ~ MINNBAPCIIS/ST. PAUL BUSINESS JUIINNAI City official Matt Podhradsky says Chaska already has bioscience roots. ~ v AGENDA ~ ,, MONTICELLO PLANNING COMMISSION ' Tuesda Se tember 4th 2007 Y~ P 6:00 PM Commissioners: Rod Dragster, Charlotte Gabler, Lloyd Hilgart, William Spartz, and Barry Voight Council Liaison: Brian Stumpf Staff: Angela Schumann, Gary Anderson Kimberly. Holier and Steve Grittman - NAC Call to order. 2. Approval of the minutes of the Planning Commission meeting of August 7`~, 2007. Consideration of adding items to the agenda. 4. Citizen comments. 5. Public Hearing -Consideration of a request for variance to allow anoff-site sign as a principal use. Applicant: St. Benedict's Senior Community 6. Public Hearing - Consideration of a request for Replat and Final Plat for First Minnesota Bank Commercial, a commercial plat in the CCD (Central Community District). Applicant: ls` Minnesota Bank 7. Public Hearing - Consideration of a request for Conditional Use Permit for Comprehensive Sign Plan for a commerciaUretail complex in the Central Community District Applicant: Seluemed, LLC Public Hearing - Consideration of a request for Conditional Use Permit for cross parking for a proposed restaurant/banquet facility in the Central Community District. Applicant: Masters 5`f' Avenue 9. Public Hearing - Consideration of a request for Conditional Use Permit for Open and Outdoor Storage in a B-3 (Highway Business) District. Applicant: Olson Property Management 10. Public Hearing - Consideration of a request for Preliminary Plat for the proposed River City Station, a commercial plat in a B-3 (Highway Business) Dc is~trict~and a~ st for rezoning from B-3_ (I~igh2o~y Business) to B-4 (Regional Busines~ ~`°~ Applicant: Chelsea Road, LLC 11. Public Hearing -Consideration of a request for amendment to the Monticello Zoning Ordinance ~~'~ Section 3-9[E] as related to the regulation of projecting signage in the Central Community District. Applicant: Monticello Planning Commission 12. Consideration to review for discussion an inventory of development entrance monuments. r 13. Adjourn. Page 1 of 1 Angela Schumann ~m: Jeff O'Neill Sent: Tuesday, September 04, 2007 12:19 AM To: Ollie Koropchak Cc: Wayne Mayer; Clint Herbst; Angela Schumann Subject: IDC in AM --- Good morning. Sending you this note late Monday night in hopes that you open it up prior to the IDC meeting scheduled for 7:00 AM. This is a quick not to let you know that I hope to stop by the IDC meeting tomorrow but will not be addressing the topic of assisting the IDC in defining its role until you and I and others have first had a chance to gather information, talk it over and then provide a report for the City Council to review. I am hoping that you, I, Angela, Tom Kelly, Joel Jamnik and the Personnel Committee can meet soon to discuss the topic. The goal of our meeting would be to come together as administrative staff and elected officials (Personnel Committee) in providing a menu of positive options/opportunities for continued IDC/volunteer participation in economic and industrial development efforts..... Our report on this topic could be provided to the IDC membership straight away, or perhaps it could provided it to the City Council and then to the IDC. I guess we can talk about the process at our meeting. An obvious date to shoot for presentation to the City Council would be the EDA/HRA consolidation workshop coming up on September 24th. It will be interesting to discuss how the EDA and IDC efforts might work together to enhance the efficiency and effectiveness of our economic development team. See you in the AM. • PS... This is tough week to meet with the IDC due to short week and City Council Agenda prep... as you know my first priority is to have the City Council agenda fully defined by 8:30 in time for Site Review which is quite impossible if I attend the IDC meeting. Also... please note that Clint had a nice chance to head out to New York this week with Diane to see their daughter so he will not be able to attend the IDC meeting. • 9/4/2007 9/5/07: Update to Monticello Industrial Development Committee RE: Revenue Bond Financing for the Monticello City-wide Fiber Optic Network ad appeared in a recent issue of the Monticello Times newspaper opposing approval of the telephone referendum on Tuesday, September 18th. It wants residents to believe that the cost of the city wide fiber optic network would end up as tax supported city debt. This is not true and here's why. The fiber optic project would be supported by revenue bonds which are paid by revenues generated from the fiber business services. This fiber optic project would not require any tax levy, even if it doesn't succeed. There will be no taxes involved with this project. The City will be obtaining revenue bonds which will be sold to private investors to build the infrastructure for the city-wide fiber optic network and start its own telecommunications business. Once the business is up and running, customers who take service (Internet, telephone and cable TV) will pay monthly bills creating revenue which will pay back the bonds over a 20 year period of time. Revenue bond financing protects the City pocketbook and here's why. First, there are very good reasons to expect that the bonds will be repaid from the operations of the system. The bonds are being sold to private investors and they buy them only when they expect the City business to succeed based on the thorough business plan prepared by the City and relied upon by investors. ~~ U Second, these bonds are not linked to the tax system of the City. These are revenue bonds linked to the revenues of the business that the City will operate. The City is not obligated to pay revenue bond debt with taxes. The financial risk if the City business had a shortfall or failed lies with the investors in the revenue bonds, not on the City. Third, the amount of revenue bonds to be sold should cover the costs of the system. But what happens if the business needs more money because it grows too fast or too slow? Then more bonds of the same type would be offered and the investors would look at the business operation to evaluate them. If you have any questions or concerns regarding the facts about the bonds or any other aspect of the upcoming referendum or the city-wide fiber optic network, please contact us. We here to answer your questions if you have them. Monticello City Fiber Optic Committee • Email: Fiber@MonticelloFiber.com • Phone: 763-271-3204 • Website: www.MonticelloFiber.com Voting will take place on Tuesday, Septemberl8, 2007 at the Monticello Community Center gymnasium. (Polling hours will be from 7 a.m. to 8 p.m.) You must be a resident of the City of Monticello to be eligible to vote. Please bring proof of residency (ie. driver's license). NOTE: If you are unable to vote in person on September 18, please contact Monticello City Hall at 763-271-3206 for information about an absentee ballot. SEPTEMBER 2007 • Monticello City Information and Facts Regarding the Upcoming Referendum on September 18 the City is planning to construct acity-wide ~ fiber optic network t® provide Internet, Cable TV and telephone services. Construction by the City of a telephone exchange which would provide telephone service over the city-wide fiber optic network requires voter approval under Minnesota law. • -. ..- -. Revenue bond financing protects the City pocketbook and here's why: First, there are very good reasons to expect that revenue bond debt with taxes. The financial risk if the bonds will be repaid from the operations of the City business had a shortfall or failed lies with the system. The bonds are being sold to private the investors in the revenue bonds, not on the City. investors and they buy them only when they expect Third, the amount of revenue bonds to be sold the City business to succeed based on the should cover the costs of the system. But what thorough business plan prepared by the City and happens if the business needs more money relied upon by investors. because it grows too fast or too slow? Then more Second, these bonds are not linked to the tax bonds of the same type would be offered and system of the City. These are revenue bonds the investors would look at the business operation linked to the revenues of the business that the to evaluate them. City will operate. The City is not obligated to pay Voting will take place on Tuesday, Septemberl8, 2007 fr: `:~.. ;:}'::iii ?:.t;.:. ~:.>:: <~'v:~> Facts About the Planned City Offerings on the Fiber Optic Network: If the referendum is favorable the City intends to implement and sell telephone, cable TV and Internet services on a fiber optic network. As a part of this project, the City intends to construct a building to house the equipment for providing services for telephone, Internet and Cable TV . The fiber optic network will be built to all areas, both old and new within the City limits so that fiber optics are available to every home and business. None of the current providers offering service within the City of Monticello have indicated they plan to build a fiber optic network to every home and business in both old and new areas. • While the City will offer bundles of multiple services, it will not be mandatory to buy the entire bundle. Services may be purchased separately. The City plans to provide full competitive cable TV offerings that include Video on Demand (VOD), High Definition TV channels (HDTV), Pay-per-view, DVR Recorders (to record shows and watch later), a full array of movie channels and video streaming • If customers desire to package long distance calling with their telephone billing, the City intends to offer that as an option. The City is also examining the bundling of cellular phone services • A customer service office building will be provided locally and customer service representatives will be located in the City of Monticello. Customers will be able to pay with one bill. You can walk into the Monticello City office to make your payment in person or use the bill pay box located outside the building for after hours drop off. MONTICELLO -~ ~- -t~ ~~ ~ -~at the Monticello Community Center gymnasium. (Polling hours will be from 7 a.m. to 8 p.m.) >::>::<;<:>s;., You must be a resident of the City of Monticello to be eligible to vote. `~~~'~`~~'`~"~~~~"""~~'~'~~~ brin r f f n i i li n ~~~~ ` Please g p o0 o reside cy (e. dr ver s ce se). ~ ~}n>: ~h. ~. ~ ~' $' ~ ''~z+~`~~~~~`~~{i?~+$~'~~f~` NOTE• If you are unable to vote in person on September 18, ,: ~ ; ~f . ~ please contact Monticello City Hall at 763-271-3206 _f<<~ to obtain information about an absentee ballot. • Customers will not be required to sign a contract for a minimum or long length of services. Customers will be able to cancel service with the City at any time if they are not satisfied. Business customers who need very large dedicated data connections or specialized services may be required to sign a contract. • There is no planned connection or hook-up charge for standard services. Residents and businesses will be able to connect to the new network for free when they take those services. • The City's Internet speed offerings will be the same to both send and receive Internet content. For example, a user taking 20 Mbps service will have the same 20 Mbps speed for both upload (to send to the Internet) and download (to receive from the Internet). The City's Internet speed can usually be delivered inside homes or businesses over existing wiring (generally copper). We encourage you to contact the City of Monticello if you have further questions by calling 763-271-3204; Email to: fiberC~MonticelloFiber.com or visit the website: www.MonticelloFiber.com ty Hall is located inside the Monticello Community Center at: 505 Walnut Street, Suite. 1, Monticello MN 55362 Note: If you would like a representative of the City Fiber Optic Committee to speak to your group, - -please-call 763.271-3204 with your. request. Sample City Question Ballot and Information ~ for the Upcoming Referendum on September 18`h CITY QUESTIOI~I BAI140T ClTY.OF MON7fCE~LO, MlNNES~'~A SREClAt_ ELECTfOfV 'I't1ESDAY, SEPTEMBER 9$, 20f37 ~To vote for a goes#ion, put an (X} in the square next to the word "YES" for that question, To vote against a question, {{!!put an (X) in the square next to the word "Nd" for tha# 30LJe5tlOn. . ~~~:~., CITY Qt! AUTHORiZATEON TO iRF A The CEr`~ Ss pia ' ; Eo cJi{tct a city-wide fiber opt'sc neY~ork to y YES pmrfde lntemet,~ TV an''2t~ghone services.. Cnnatnrction, '~ € NO ey thr. ay, c{ a aE ho.~ exchange, which would provide tale 4ce t ~ uy-wade fllper optic network, requires voter ag` ~ ;FAi sofa law. Tho pnsp°scd teiephotte exchange w~td be anted with revenue tx3nds which are to he <,,:. :~~illack by rues generated from t}rose taking totephotoe 'tie ~{++~~,'s.weN, s Internet and cable 7V services)witttottt a ~iedyS c~tq'tax°s. fr. order to provNSe ietephone service as part • oNt~ network., the Gity is asking rggib3e .mars to vote °n ttds qu~gll°n: <~hat~he City of b§onficstlo bo authottzed to construct, rchage, or proued to acqutre a tetsphnne s:change? Why does the ballot question only ask about a telephone exchange? The City is able to operate Internet and Cable TV services over aCity-wide fiber optic network without referendum approval. If the referendum passes, and the ownership of a telephone switch is part of the fiber network, the City would not have to purchase telephone services from an outside provider. In order to offer telephone services, the City would need to own a telephone switch or purchase telephone services at wholesale cost from another company. The City put out a request for proposal for offering telephone services in the City of Monticello and did not receive a response back from the local providers. The City will not be dependent on pricing from another company if it owns its own telephone switch. The City could set its pricing based on the opera- tion of a City-owned telephone switch. Where would the City-owned telephone exchange be located? The City intends to construct a building within the City limits to house the equipment for providing services for telephone, Internet and Cable TV. Operation of this telecommunications business would also include a local office with local staff people to help with customer service as well as providing technical assistance. Why is the City of Monticello conducting a referendum? The City is conducting this referendum because telephone service is one of the offerings that would be provided to Monticello residents over acity-wide fiber optic network the City is planning to build. The only way for City residents to hold ownership in this telephone service, by Minnesota State Statute, is for residents to vote on and approve a referendum by 65% or more. The City is asking voters to authorize the construction, purchase or acquisition of a telephone exchange in order to deliver local and long distance telephone service on a city-wide fiber optic network. The system will also offer cable N and high speed Internet services; however, those services can be offered by the City without special authorization by the voters. What happens if the referendum passes? The City would be authorized by the voters to construct, purchase or acquire a telephone exchange. This would enable the City to directly offer telephone service throughout the community along with cable TV and high speed Internet services. What happens if the referendum fails? The City would not be authorized by the voters to construct, purchase or acquire a telephone exchange. If the referendum passes, what's next in the process for building aCity-wide fiber optic network to every home and business in fhe City limits? The next step would be to complete the financing requirements, retain engineering services to design the system and begin construction. This set of activities will take approximately 4 to 6 months following the referendum, if it passes. The first services to customers are likely to begin within 18 to 24 months (early summer 2009), after the fiber optic network is built . Monticello City Information Regarding the Upcoming Referendum The City is planning to construct a city wide fiber optic network to provide Internet, cable TV and telephone services. Construction by the City of a telephone exchange would provide teleph e service over the city-wide fiber optic network requires voter approval under Minnesota law. proposed telephone exchange would be financed with revenue bonds which are to be paid ck by revenues generated from those taking telephone service (as well as Internet and cable TV services) without a pledge of City taxes. In order to provide telephone service as part of the network, the City is asking eligible voters to vote on the following - QUESTION THAT WILL APPEAR ON THE BALLOT on SEPTEMBER 18: Shall the City of Monticello be authorized to construct, purchase or proceed to acquire a telephone exchange? See inside for additional voter information. 3 Residential data rates verified with the TDS and Charter business offices in July 2007. Residential Price and Product Information Telephone rates shown here are for local and metro service. ' TDS rates were quoted by their business office in July 2007. Note that TDS now has some rate flexibility with rates and IewerE~es this year. The residential rate of $32.99 includes a Subscriber Line Charge of $6.50. z !f customers desire to package long distance calling with their billing, the Ciry intends to offer that as an option. RESLDE~ITi~4L TDS ......... $49.95/Month Charter ..... $42.99/~1lonth City .... $31.95/Month '; DSL 3 Mbps download, Cable Modem 0 5 Mbps upload 3 Mbps download, 20 Mbps download, . $8.56 per Megabit 2 Mbps upload $8.80 per Megabit 20 Mbps upload 89a per Megabit City .... $44.95/Moreth 30 Mbps download, 30 Mbps upload 75~ per Megabit "Price per Megabit is calculated by dividing the price by the total a mount City .... $79.95/Month of upload plus download bandwidth measured in megabits. 50 Mbps download, 50 Mbps upload 80¢ per Megabit 1 1 . - • • - • Expanded Basic N/A $47.99 $40.79 Digital Cable $44.99 $54.94 $46.74 Digital plus 1 HBO $59.98 $67.94 $57.75 s These rates were quoted by the TDS business office in July 2007. You must subscribe to TDS telephone service in order to receive these rates. These TDS /Direct TV rates may be less than purchasing directly from Direct TV. s These rates were quoted by the Charter business office in July 2007 and also verified on their web site. ' The City plansta offef a full competitive cable offering that will include Video on Demand (VOD), High Definition TV channels (HDTV), Pay-Per-View, DVR Recorders (to record shows and watch later), and a full array of movie channels. The Ciry also plans to offer local programming including government access and local events like parades, high school sporting events, little league games, and other local programs. MONTICELLO City residents are being asked to vote on a referendum for the approval of offering telephone services on a city-wide fiber optic system. We think that understanding the proposed products and prices that are contemplated for the City fiber optic network are essential for you to make an informed decision. The City services and prices are not yet final, but these are what the City is currently contemplating in its analysis of the feasibility of the fiber optic network. ~Ne believe these are very representative of the actual products and prices the City will offer with the system.