EDA Agenda 01-29-1991ANNUAL MEETING
AGENDA
t"- MONTICELLO ECONOMIC DEVELOPMENT AUTHORITY
1 Tuesday, January 29, 1991 - 7:UU AM
City Hall
MEMBERS: Chairperson Ron Hoglund, Vice Chairperson Barb
Schvientek, Assistant Treasurer Bob Mosford,
Harvey Kendall, Al Larson, Brad Fyle, and
Clint Herbst.
STAFF: EDA Treasurer Rick Wolfsteller. EDA Executive
Director 011ie Koropchak, and Jeff O'Neill.
1. CALL TO ORDER.
2. WELCOME. TO NEW EDA MEMBERS.
3. APPROVAL OF THE OCTOBER 30, 1990 EDA MINUTES.
4. CONSIDERATION TO REVIEW AND ACCEPT THE 1990 EDA
ANNUAL REPORT.
5• CONSIDERATION TO REVIEW AND ACCEPT THE 1990 EDA
FINANCIAL REPORT.
b. CONSIDERATION TO ELECT 1991 EDA OFFICERS.
a) President, Vice President, Treasurer, Assistant Treasurer,
and Secretary.
7. Other Business.
8. Adjournment.
MINUTES
MONTICELLO ECONOMIC DEVELOPMENT AUTHORITY
Tuesday, October 30. 1990 - 7:On AM
City Hall
MEMBERS PRESENT: Chairperson Ron Hoglund, Barb Schwfentek. Bob
Mosford, Fran Fair. Warren Smith, Al Larson,
and Harvey Kendall.
STAFF PRESENT: Rick Wolfsteller and 011ie Koropchak.
1. CALL TO ORDER.
Chairperson Ron Hoglund called the EDA meeting to order at
7:00 AM.
2. APPROVAL OF THE SEPTEMBER aq, 1990 EDA MINUTES.
Fran Fair made a motion to approve the September �%, 1990
EDA minutes, seconded by Al Larson, without further discussion
the minutes were approved as written.
3. CONSIDERATION TO REVIEW AND DISCUSS THE GMEF PUBLIC PURPOSE
CRITERIA AND GUIDELINES.
Enclosed with the EDA agenda as supporting data were copies of the
original purpose for the creation of the revolving loan
fund, City Council agenda and minutes, and the approved GMEF
Guidelines as written by the original committee, reviewed
by Attorney Haves, reviewed and accepted by the IDC, and
reviewed and adopted by the City Council. After adoption
of the EDA organization the guidelines were reviewed by
the EDA members in May. 1989.
Invited but unable to attend this EDA maeting were the original
members who wrote the guidelines; Dale Lungwitz, Linda Mielke,
Don Smith, and Jeff O'Neill. With bnckgrnund information having been
discussed, the EDA members proceeded to review, discuss, and
adPist the GMEF Public Purpose Criteria and Guidelines.
The EDA noted that the purpose of the CHEF is to encourage
economic development by supplementing conventional financing
sources available to existing nod new businesses. Additionally.
all loan must comply with four nr more of the public purpose
eriterins, of which, criteria 01 is mandatory.
To comply with the Council's request to clarify the definition
of what constitutes creation of a full-time versus part-time job,
rhe EDA considered two options for adjuatmant. Ono, a total of 40 hours
per week would constitute one full-time job, and second.
r Bob Mosford suggested in consistency with today's norm, 37.5
t` hours would constitute one full-time job. Bob Moeford made a
motion that one job be equivalent to a total of 37.5 hours per
weak. The motion was seconded by Barb Schwfentek and without
further discussion passed unanimously.
EDA Minutes
10/30/90
Page 2
3. CONTINUED.
The EDA members agreed no adjustment was necessary for Criteria
h2. To provide loans for credit worthy businesses that would
increase the community tax base.
Criteria R3. To assist new or existing industrial or non-
competitive commercial businesses to improve or expand their
operations. Loans will not be provided for businesses in
direct competition with existing businesses within the City
of Monticello. Bob Mosford recalled to the EDA members that
at the time the EDA members reviewed the GMEF guidelines
in May of 1989, the EDA recognized the gray area of this
criteria and recognized the potential of a future tough
decision. The EDA agreed with the City Council that the main
thrust of the loan program should be oriented toward Industrial
development, however, on the other hand didn't see a benefit
of restrictive guidelines which would allow no flexibility for
funding. The EDA members interpret the GMEF Guidelines as
guidelines to follow and not as hard -carved policy and based
on common sense prefer to evaluate each GMEF application for
approval on the basis of project merit and project benefit
provided to the community and it's people. Therefore, the
EDA made no recommendation to adjust criteria #3. The EDA
felt the Muller Theatre loan approval was for n project
which both benefits the community and it's people as the
project increasedthe aesthetic value of downtown, retained
a downtown business, and supports the Streetscape Project.
(See EDA minutes of 9/28/90 for full approved loan criteria.)
Criteria 14. To provide loans to be used as secondary source
of financing that is intended to supplement conventional financing
(bank financing). The EDA agreed no adjustment was necessary
of this criteria.
Criteria 115. To provide loans In situations in which a funding
gap exists. The EDA recognized that in no way could the EDA
verify a company's actual gap funding, however, also acknowledged
the original intent of the revolving loan was to create an
Incentive for industrial businesses to locate within Monticello.
This tool was intended to maintain Monticello an a competitive
city for industrial recruitment, to addition, as a retention
and expansion tool for existing businesses. The Tapper's
loan was part of n financial package developed by Business
Development Services and in the case of the Muller Theatre
loan,the developer did reduce the cost by going out for
bids on three different occasions, n theatre doesn't
meat the SBA or State program criterins and TIF wasn't
applied because a district couldn't be established under
current TIP criteria. Tho loan application requested
no funds for demolition which would indicate funds to
climititu blight. The EDA considered the blight ianuo no
EDA Minutes
10/30/90
Page 3
3. CONTINUED.
they approved the loan based on the total project development benefits to
the community and it's people as the total project development increased
the aesthetic value of dovncown. Therefore, the EDA agreed
no recommendation was necesary to adjust criteria 1/5.
Criteria 96. To provide funds for economic development that
could be used to assist in obtaining other funds such as Small
Business Administration loans, federal and state grants, etc.
The EDA members agreed no recommendation was necessary to
adjust critferia 116.
The EDA continued to review the GMEF Guidelines and based upon
the data presented the members on the attorney's fees for
the Tapper's loan of approximately $1,300 and the banks service
fee of $20.00 per month on the loan, the EDA agreed to recommend
an adjustment. Bob Mosford made a motion to adjust the loan
fee on page 3 to read: Minimum fee of $200 but not to exceed
1.5% (replaced 1%) of the total loan project. The motion was
seconded by Warren Smith and without further discussion passed
unanimously.
The EDA discussed the bank's fee of $20.00 a month and what
services were being provided for the charge. Administrator
Wolfsteller expressed his viewpoint that for the services
being rendered compared to the fee charged over the length
of the loan, the city staff has the knowledge to nccompltah
the same service. Warren Smith reminded EDA members that
the approval to have the bank service the loan was made to
eliminate additional duties to city staff. Bob Mosford
made a motion recommending Administrator Wolfsteller negotinte
an agreement between the city and the hank which would
maintain the bank's service of the two loans at no cost
as the GMEF policy enhances the banks policies and is a
benefit to both parties and the community. The motion
was seconded by Al Larson and without further discussion
the motion passed unanimously.
In reference to the recommended adjust to the loan fee of
not to exceed 1!51 of the total loan project. Bob Mosford
also made a motion to adjust item 7, on page. 6, to Include:
the City Attorney shall review and/or prepare all contracts.
This adjustment to clarify the attorney's role with the
GMEF loan closing. The motion was seconded by Warren
Smith and without further discussion passed unanimously.
The EDA briefly discussed the need to establish n policy
% which would allow a penalty if designed amount of jobs
weren't satisfied. The EDA at this time doesn't see the
need to create restrictive policies, however, suggested
that periodical accountabllty of ,lob creation be made
within a reasonable time of completed project and he reported
EDA Minutes
10/30/90
�r Page 4
3. CONTINUED.
to the EDA as well as the current loan payment statis.
Consideration of any necessary action will be discussed
if the need arises.
The EDA agreed that the definition of new jobs included any
new job created in Monticello due to an expansion or relocation.
4. OTHER BUSINESS.
Harvey Kendall made a motion for the UDAG repayments
to the City from Fulfillment Systems. Inc. be transferred into
the EDA account to assure adequate future funds for the
CMEF. Al Larson seconded the motion and without further
discussion the motion.passed unanimously. The EDA expressed
some potential resistance from the City Council to transfer
additional Liquor Store monies to replenish the EDA funds.
Current remaining balance of the EDA fund is $62,000 which
allows a maximun of $31.000 available for loan approval.
Fran Fair made a recommendation that new council members
receive education in the area of the EDA functions and
{ policies by either Rick Wolfsteller or 011ie Koropchak.
EDA members agreed with the recommendation.
5. ADJOURNMENT.
By consensus of the EDA members, the EDA meeting adjourned
at 8:20 AM.
r�� c limo
011ie Koropchak
EDA Executive Secretary
EDA 1990 ANNUAL. REPORT
MEETINGS: APRIL 3, 1990
APRIL 4, 1990
APRIL 24, 1990
JULY 24, 1990
SEPTEMBER 28, 1990
OCTOBER 30, 1990
EDA HOUSEKEEPING
TAPPER'S INC LOAN PRESENTATION AND LOAN APPROVAL
QUARTERLY MEETING AND ADJUSTED TAPPER'S LOAN AMOUNT
QUARTERLY MEETING AND PRELIMINARY REVIEW OF
JEFF EASTEY ENTERPRISES LOAN
MULLER THEATRE PRESENTATION AND LOAN APPROVAL
QUARTERLY MEETING AND RECOMMENDED ADJUSTMENTS
TO THE EDA PUBLIC PURPOSE CRITERIA AND GUILDLINES
*****fi#*#•ffk*#f*f*#ff#f•#f#i#*i*i#f#Ri#kf#f#f**#ii*#***i***#i*#k#*i##**
LOANS: BONDHUS CORPORATION WITHDRAWAL OF PRELIMINARY LOAN APPLICATION
TAPPER'S INC APPROVAL OF $88,000 GMEF LOAN
JEFF EASTEY ENTERPRISE PRELIMARY APPLICATION APPROVED/ UNABLE TO SECURE
BANK FINANCING
MULLER THEATRE APPROVAL. OF $50,000 GMEF LOAN
CIRCUIT TECHNOLOGIES PRELIMINARY LOAN APPLICATION RECEIVED, UNABLE
TO SECURE BANK FINANCING/ENDORSEMENT
DECEMBER 31, 1990
RICK WOLFSTELLER. EDA TREASURER
r
1990
EDA YEAR END REPORT
TAPPER'S INC.
MUELLER THEATRE
TOTAL
CASH
$ 2,271.25
$
281.53
$ 2,552.78
LONG TERM RECEIVABLE
$ 87,260.97
$
49.919.63
$137,180.60
TOTAL ASSETS
$ 89,532.2f
$
50.2U1.lb
$139,/SJ. 36
REVENUE
INTEREST EARNED
$ 2,941.32 AUG '90
$
756.07 NOV '90
$ 3,697.39
TRANSF.R FROM LIQUOR STORE. FUND
$ 88,000.00
$
50.000.00
$138,000.00
TOTAL REVENUE
$ 90.941.32
$
50.756.07
$141,697.39
EXPENSES
LOAN SERVICE FEE
$ 100.00
40.00
$ 140.00
LEGAL FEES (SMITH/HAYES)
$ 1,309.10
514.91
$ 1,824.01
TOTAL EXPENSES
$ 1,409.10
$
554.91
$ 1.9b4.U1
TOTAI. FUND BALANCE
$ 89.532.22
$
50,7.U1.16
a1 J9, iJJ. JB
DECEMBER 31, 1990
RICK WOLFSTELLER. EDA TREASURER
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