EDA Minutes 04-11-2012MINUTES
ECONOMIC DEVELOPMENT AUTHORITY (EDA)
Wednesday, April 11, 2012 - 6:00 p.m.
Commissioners Present: President Bill Demeules, Treasurer Bill Tapper, Tracy Hinz, Matt Frie,
and Council Members Tom Perrault and Brian Stumpf
Staff: Executive Director Megan Barnett - Livgard, Finance Director Tom Kelly
Others: Linda Jacobson, Bill Kemp, Todd Hagen, Brett Weiss, John Chadwick
1. Call to Order
Bill Demeules called the meeting to order at 6 p.m.
2. Approve Meeting Minutes
BILL TAPPER MOVED TO APPROVE THE MARCH 14, 2012 EDA MINUTES.
MOTION WAS SECONDED BY BRIAN STUMPF. MOTION CARRIED 6 -0.
3. Consideration of additional agenda items
a) Resolution #2012 -036 approving two purchase agreements for Montgomery Farms
property
4. Consideration of approving a GMEF loan for Jacobson Veterinary Urgent Care
Clinic
The Monticello Pet Hospital (Jacobson Properties) recently obtained a $50,000 dollar
GMEF loan to assist in expanding their existing pet clinic facility located off of Highway
25. The new facility is located behind Wal -mart and construction is almost complete.
The Jacobsons would like to include opening an animal urgent care facility as part of their
relocation and business expansion plans based on their analysis of area demand. The
proposed new business would bring in 13 new full time livable wage paying jobs to the
community. Monticello Pet Hospital requested a $140,000 dollar GMEF loan to assist in
opening an after -hours urgent care veterinary facility. The requested loan will be utilized
for equipment purchases in an effort to free up "cash" that can be utilized for working
capital.
BRIAN STUMPF MOVED TO ADOPT RESOLUTION #2012 -035 APPROVING A
GMEF LOAN FOR MONTICELLO PET HOSPITAL. MOTION WAS SECONDED BY
TRACY HINZ. MOTION CARRIED 6 -0.
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5. Presentation by Podawiltz Development: proposing a subsidized rental townhouse
ro'ect
Bill Kemp from Podawiltz Development discussed an opportunity to construct affordable
workforce rental townhomes in Monticello. The development would require the creation of
a new housing TIF district. He reviewed their product line, financing structure, income
guidelines, desired location and timeline. They are looking to purchase 36 of the 72 parcels
available in the Autumn Ridge townhome development and build rental townhomes. This
project would involve a federal housing tax credits program administered by the MN
Housing Finance Agency (MHFA). It is not a rental subsidy program. Podawiltz
Development has completed similar projects recently in Buffalo and Sartell.
There was some discussion as to the value of establishing a TIF District for housing. Todd
Hagen from Ehlers responded to some questions about residential TIF districts and
decertification options once an obligation is met.
The EDA was asked to provide some general direction to the developer regarding the
proposed rental townhouse development. As the EDA was not unanimous in its support,
staff recommended that the issue be brought forward for City Council review at its April
23rd meeting.
6. Consideration of purchasing property zoned B -4 and owned by John Chadwick
City Council had directed the EDA to review the option of purchasing John Chadwick's
19.08 acre parcel located north of Chelsea Road for the purpose of economic development
and/or a future interchange as part of its consideration of his request to amend the special
assessments on the property.
Staff indicated that there is a significant demand for large tracts of land with a minimum of
20 -75 acres on which to build. Staff does not believe Mr. Chadwick's parcel is the best
location and land configuration for a future industrial park. The EDA will need to analyze
if purchasing Mr. Chadwick's property is at a price worth paying holding costs until such
time as smaller lot industries begin to initiate new construction projects and /or an exact
location of an interchange is determined and initiated.
Bret Weiss from WSB Engineering indicated that concepts had been developed for a
potential future interchange location but that no action had been taken. Upon preliminary
analyses of a future interchange location within the Otter Creek vicinity, it was determined
that John Chadwick's property would not be needed.
John Chadwick is asking $2,077,810 for the subject property. There are outstanding taxes
and an outstanding assessment on the property. If the EDA were to purchase the property it
is anticipated that the EDA general fund would be the funding source. Currently the EDA
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has a general fund balance of 2.8 million. It should be noted that financial resources are
limited and the EDA may find it difficult to purchase Mr. Chadwick's parcel and continue
to invest in the downtown.
John Chadwick of 4477 Manitou Road in Excelsior asked a few related questions of Bret
Weiss. He pointed out that the land is valuable in that it is freeway frontage.
TRACY HINZ MOVED TO DENY PURCHASING MR. CHADWICK'S PARCEL.
MOTION WAS SECONDED BY BRIAN STUMPF. MOTION CARRIED 6 -0.
7. Consideration of cancelling the listing agreement between Commercial Realty
Solutions and the Monticello EDA and discuss the idea of creating a broker incentive
fee for the Monticello Business Center
City staff is often more active in the negotiations and interactions with companies than the
listed broker when providing TIF assistance in the industrial park. As a member of
MNCAR the EDA has access to list industrial property on the MLS database to gain
commercial broker exposure. Staff has also arranged for a commercial broker breakfast
and tour of city on April 27th. It doesn't appear to be cost effective to maintain the listing
agreement with Commercial Realty Solutions at this time.
Additionally, in an effort to incentivize brokers to pay attention to Monticello, staff
recommended creating a $3,000 dollar Broker Incentive Fee for the industrial park. The
terms or commissions of a normal land transaction would remain the same. If a broker
brought a client to the City that became a viable project in the Monticello Business Center,
that broker would receive a $3,000 dollar "bonus" after the property closed. The proposed
incentive fee would be a pilot program and be reviewed on a yearly basis.
BILL TAPPER MOVED TO CANCEL THE LISTING AGREEMENT FOR THE
MONTICELLO BUSINESS CENTER BETWEEN THE MONTICELLO EDA AND
COMMERCIAL REALTY SOLUTIONS FOR THE MONTICELLO BUSINESS
CENTER. MOTION WAS SECONDED BY BRIAN STUMPF. MOTION CARRIED
6 -0.
BRIAN STUMPF MOVED TO DIRECT STAFF TO WORK WITH KENNEDY AND
GRAVEN TO DETERMINE VIABLE TERMS AND PARAMETERS TO IMPLEMENT
A BROKER INCENTIVE FEE FOR THE MONTICELLO BUSINESS CENTER.
MOTION WAS SECONDED BY BILL TAPPER. MOTION CARRIED 6 -0.
8. Director Report
The City received a plaque from the Initiative Foundation in thanks for its donation.
City Council approved increasing the city's water and sewer rates by 8% and 12 %,
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respectively. Tom Kelly stated that the increased rates are still one of the lowest in the area.
New rates will only cover only the cost of operations. Asset replacement costs may require
a future bond issue.
Bill Tapper asked why the City was not awarded the DEED Redevelopment Grant. Staff
pointed out that the grants are competitive and often are awarded to cities within the metro
area. The City will apply for this grant again and apply for the Small Cities grant as well.
Matt Frie asked about the status of a potential purchase of a second liquor store near the
new interchange off of Broadway in Monticello. Tom Kelly stated that staff and the
property owner are currently still in negotiations, however it does appear that an agreement
will be reached soon. The funds would be from the current liquor store fund and be repaid
through profit from the new store.
9. Consideration of items added to the aeenda
a) Resolution #2012 -036 approving two purchase agreements for Montgomery Farms
property
BILL TAPPER MOVED TO APPROVE THE RESOLUTION TO ACCEPT A
PURCHASE AGREEMENT FOR THE MONTGOMERY FARMS PROPERTY.
MOTION WAS SECONDED BY MATT FRIE. MOTION CARRIED 6 -0.
10. Adjournment
BILL TAPPER MOVED TO ADJOURN THE MEETING AT 7:20 PM. BRIAN
STUMPF SECONDED THE MOTION. MOTION CARRIED 6 -0.
Recorder:
Approved: May • 2012
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