07-26-2023 EDAM EDA Board Meeting
Hutchinson Enterprise Center
11 :30 AM Tuesday, July 26t', 2023
MEETING MINUTES
Members present in bold.
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EDA Board Members Operations
Cash Available $231,660
Mike McGraw Reserved $56,736
Jonny Block Unreserved $170,397
Mike Cannon Economic Development Loan Fund
Corey Stearns Cash Available $184,655
Chad Czmowski Zephyr Wind Services $54,673
Pat May FireLake Mfg. $30,716
Jack Daggett Laser Dynamics Balance (forgivable) $23,000
Jeremy Carter Innovative Foam Balance $14,355
Advances to other funds (Enterprise $217,166
Staff Center)
Miles Seppelt, EDA Director Downtown Revolving Loan Fund
Matt Jaunich, City Administrator Cash Available $396,769
Andy Reid, Finance Director Loans Receivable $315,907
Owen Streich, EDA Intern Capital Assets $201,329
Total Assets $1,056,207
I. Call to Order MIF Loan Fund
Meeting called to order at 11:27 AM. Cash Available $11,486
MOXY Loan Receivable $6,672
II. Review Agenda Enterprise Center Fund,
III. Review Minutes Cash Available $31,258
SHOPKO TIF District(TIF 4-5)
a. June 215t Finance Team meeting Cash Available ((� )
M/S/P: Cannon, Daggett to accept the minutes as Interfund Loans Receivable $418,793
written. Passed unanimously.
b. June 27' EDA Board Meeting
M/S/P: Stearns, Czmowski,to accept the minutes as written. Passed unanimously
IV. Review of EDA Financial Statements (Please refer to table)
■ EDA received its first half tax settlement from the county in the amount of$134,966
■ $35,000 received for Childcare Forgivable Loan Program(First Children's Finance = $30,000+$10,000 from
3M, of which the Chamber is holding $5,000 for a micro-grant program for childcare providers)
M/S/P: Cannon, Daggett to approve the financial report as presented. Passed unanimously.
V. Director's Report
A. Marketing Plan Report: Facebook updates= 10,Website updates=4
Social media effort has 830 follows on Facebook.
B. Business recruitment/expansions—Staff provided an update on recent prospects and ongoing conversations.
C. BR&E Visits—Rite Way has slow sales/Warrior very busy/Impressions has new ownership with plans to grow
the Hutchinson facility
D. Project 9500—on hold until major employers are hiring again.
E. Gold Coin—slow movement
F. Child Care Forgivable Loan Program—funds received/program set up/first application received/will create 12
new childcare slots
G. DEED Grant application—submitted/seeking $53,821 for infrastructure on Lot 1140
H. Uptown Grand—Witt's closed on new house July 201h/City paid out$58K"differential payment"
I. Franklin Site RFP—MITGI proposal will be brought to City Council for consideration
J. State Theatre purchase—potential Twin Cities buyers have backed out
K. Downtown Plan 3.0—staff met with consultants to discuss scope of project/project cost forthcoming
L. Spec Building—in talks with two potential developers
M. Sale of Industrial Park land—HUC inquired about potential purchase of 1.44 acres for new substation
VI. EDA Levy&2024 Budget
■ Staff shared some data to provide context:
o As of 2021, Hutchinson"Price of Government" is at its lowest point in 20 years.
o The City's tax rate has decreased steadily for eight straight years—this is due to the tax base
growing.
o Hutchinson's overall taxable market value(tax base) has doubled since 2014: going from$731
million in that year to$1.5 billion now.
■ Hutchinson has the 5th highest median household income of 19 regional centers in the state, and has the 3rd
lowest percentage of its population with an income below poverty level.
■ Staff proposed keeping the EDA tax rate flat.
■ Because the estimated market value of the community has grown since last year, the levy(the actual amount
of dollars)would then increase by$14,673 to a level of$272,842.
■ On the budget side, staff proposed the following:
■ Given that the Downtown Loan Fund has seen its total assets decline steadily over the years, due to
(1)Sign &Awning Grants
(2)Fagade Improvement Grants
(3) Paying for two Downtown Plans
(4)$100K contribution to the Farmer's Market Pavilion
■ Certain recurring expenditures could be moved to the operations budget, as follows:
o Sign &Awning Grant Program, at an annual cost of$16,000
o Fagade Improvement Grant, at an annual cost of$22,500
o Downtown studies, at an annual cost of$20,000
o Dollars would be"fronted" as needed from Downtown RLF, but then repaid via annual transfers from
the EDA Operations budget.
■ Rationale for the change:
o Preserve and rebuild Downtown Loan Fund total assets
o Match recurring expenditures with recurring revenues(better financial management)
■ Discussion
M/S/P: May, Daggett to adopt proposed levy amount and 2024 EDA Budget. Passed unanimously.
VII. Strategic Plan Update
■ EDA Mission, Vision &Values statements were reviewed.
■ Consensus was to keep them as written.
■ The rationale for emphasizing manufacturing as an economic development strategy was discussed:
(1) To"reinforce success"—Hutchinson is Minnesota's Manufacturing City
(2) Diversify Hutchinson's employment base
(3) Manufacturing provides highest average weekly wages of any economic sector($1,498)
(4) Manufacturing provides the highest spending multiplier effect(every$1 of manufacturing income
translates to$1.48 to$1.92 of additional economic activity)
(5) Manufacturing provides the highest employment multiplier effect(every manufacturing job created
leads to the creation of 5-7 other jobs in the economy)
■ The EDA's five core economic development strategies were discussed:
(1) Business Retention &Expansion
(2) Skilled Workforce Development
(3) Business Incubation
(4) Business Attraction
(5) Downtown Redevelopment
■ Consensus was to make two additions to our core strategies:
(6) Child Care businesses development
(7) Housing development
■ These strategies will be individually reviewed at upcoming meetings to develop action items for each.
Vill. Grant& Loan Program Applications—NONE
IX. Set Next Meeting—11:30 AM Wednesday,August 23rd, 2023
X. Adjourn—M/S/P: Czmowski May to adjourn the meeting at 12:45 PM. Passed unanimously.
Respectfully Submitted,
Miles R. Seppelt
Economic Development Director