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12-20-2002 EDAMHutchinson EDA Board of Directors Minutes of Meeting Friday, December 20, 2002 Members present in bold print Members: Tim Ulrich Bob Windel Jim Haugen Jeff Haag Duane Hoversten Keith Fischer Guests: Ken Merrill Marc Sebora Staff: Lisa McClure, EDA Intern Miles Seppelt, EDA Director 1. Tim Ulrich called the meeting to order at 7:05 a.m. Matt McMillan 2. Consideration of minutes from the November 22, 2002 meeting. Don Walser Vi Mayer Item 5, first paragraph dollar amount should be $488,586. Item 8; note that Tim Ulrich and Jeff Haag abstained from voting. Item 11 should read "...is resolved..." take out the word not. A motion was made by Duane Hoversten to approve the minutes from the November 22, 2002 meeting, with the necessary changes. Bon Windel seconded the motion. Tim Ulrich asked for discussion. The motion passed. 3. Review and approval of Finance Team minutes from December 18, 2002 Item 4, will be rewritten using different language. A motion was made by Bob Windel to approve the minutes from the December 18, 2002 meeting, with the aforementioned change. Keith Fischer seconded the motion. Tim Ulrich asked for discussion. Motion passed. 4. Review Financial Statements Ken Merrill went over the November financial statements. He stated that on page one the balance sheet shows $138,234 in cash, but will have an additional $10,000 transferred in. On page two and three, the transfers have been made into the operations budget. There is $110,000 from the general fund. There is a surplus in wages, which will carry through the end of the year. Consulting was spent on the HKGi services. A transfer in the amount of about $92,000 will be made. Under communications, there has been a posting error. Ken will reconcile this. Page four, the Economic Development Loan Fund. There will be a loss of $60,000 for the Plastic Specialties loan. Crow River issue is still being resolved. Allied is still making monthly payments and Plastics still has a deferred loan. Expenses, the transfer to operations has been made. On page 5 the Downtown loan and grant fund, $505,104 cash and $754,328 in mortgage receivables. Fund balance is at $503,067. Prince of Peace makes an annual payment of approximately $33,000. The loan balloons in 2006. Jim Haugen mentioned that they may refinance in 2003 and this loan would then be paid in full. A motion was made by Jeff Haag to approve the financial statements for October and November 2002. Jim Haugen seconded the motion. Tim Ulrich asked for discussion. The motion passed. 5. Delinquent Loans Lisa McClure handed out a report to the board with the delinquent loans. Lisa stated that Lang has paid since the report was printed. She is waiting for Labat, Anderson/Schutt, and Reiter to pay. Reiter is the only delinquent loan at this time. Labat and Anderson/Schutt need to make their December 2002 payments. 6. 2002 Status of Loans Lisa had a statement that had all loans through the Downtown Loan and Grant Fund listed. They showed their balances as of 12- 18 -02. Lisa is also preparing a statement that includes the balances as of 12 -31- 02. This will be given to the board in January. 7. Directors Report Miles Seppelt gave his report • He returned on December 17 from Idaho • He has been talking to business owners in town • He has gone up and down Main Street meeting business owners • He has started to go through the Industrial Park • Had a meeting at Impressions • Will meet with Jim Fahey • Will meet with Sherry Ristau • He has given out most of the Hutchinson videotapes that were at City Center • He has talked with the new intern. Amanda will be starting Feb.l o Miles asked if the board minded if she started January 27 so Lisa could show her the ropes before Lisa leaves the city. The board agreed to that. • He is working on getting maps of the Industrial Park • Liquor Store planning • McLeod County EDA director — letter to County Commissioners • Working with IT to redo the EDA website • Adding info to site • Business info — available buildings, land, wages, workforce numbers, etc. • Downtown Master Plan meeting with HKGi and Julie, John, Lisa, and Miles Dec. 23 8. Industrial Park update Marc Sebora gave the board an update on the condemnation process for the industrial park property. He stated the clock is ticking. Hackbarth has signed the necessary agreements, and the information has gone to the court. The appraisals have not come in yet, but there will be a court hearing to discuss this information. The land will be the city's property on March 9 -10. The process could take until May or June 2003. The survey was completed showing 19.5 acres. Jeff Haag asked what would happen if the number that comes back from the appraiser is not one that the EDA likes? Once the process is started you have to follow through, but can reach a settlement at any time. There is another process that can be used, if the numbers are not agreeable. Keith Fischer asked about doing a Phase One environmental, the board thought that a person interested in the property could do one on their own, it isn't needed at this time. 9. EDA/HDA Structure Matt McMillan, President of the Hutchinson Downtown Association was at the meeting to discuss from the HDA's point of view how the two should be structured. Tim asked Matt to tell the board what he thinks the HDA wants. First, Matt said thank you to the board for funding the Downtown Master Plan. Christie Rock was the driving force behind establishing the Hutchinson Downtown Association as a 501(c)(3). Matt said he thinks that the Downtown Association is happy where they are. The Special Service District is a self - assessment. It needs to be initiated by a group of citizens, not the city. The HDA can initiate this process. That is one advantage of the EDA and HDA being separate. Currently the HDA has a 15- member board, and are losing two members. The EDA rep is Jeff Haag and because of scheduling problems, he has requested that he no longer be on the board. Jim Haugen and Duane Hoversten, who are both on the HDA and EDA boards, will now represent the EDA at HDA board meetings. Tim suggested that if the HDA is under the umbrella of the EDA, then the EDA could help the downtown by sharing resources. Tim also suggested that the HDA board president be an EDA board member so there will be direct communication between the two groups. Tim suggested that the EDA hold a strategic planning session. They will be able to decide what their goals are, how the structure of the EDA should be and then how the HDA fits in. This will also help Miles get acquainted with his position and to establish a chart for the EDA and HDA. The Special Service District will need help from the EDA and for the two to coordinate efforts. This is another reason that the structure should be reexamined. Don Walser asked Matt how things were working with the HDA, now that Christie is no longer with the City. Matt said that Lisa has taken over those duties and things are running smoothly. The HDA does need some staffing assistance. If the SSD would work out, that money could be used to pay for staff or to help the EDA to pay for staff. There is a split in how people view the money raised through the SSD. Some see it as a way to make money to work on projects in downtown, while others see that it should be used to fund a staff person and to pay for advertising and promotions. Matt stated that the two groups should be tied together, but that the HDA needs to remain a 501(c)(3). It can then receive gifts, raise money, and partially stand - alone. 10. Annual Meeting The board decided that it would wait to have the annual meeting until the spring of 2003 to unveil their plans and to introduce Miles. 11. Chamber Report Vi Mayer was at the meeting to give the Chamber report. • Conference calls regarding the next legislative session with the Minnesota Chamber will begin on January 24 and run through May 16 from 7:30 to 8:00 a.m. 10 dates have been set. • Blandin tickets through the Chamber or Southwest Minnesota • January 9 the Governor and Lt. Governor will be at the Event Center for a breakfast regarding Ag issues. It is $5 for breakfast; just show up that morning and it will run from 7 — 9:30 a.m. • Annual meeting January 30 • Tina Vorlichek will have a new title beginning Jan. 1, 2003. She will now be the Vice President. • President is Dave Westlund; Vice President is Peggy Glas 12. New Business Southwest Minnesota has purchased the corner lot on Highways 7 & 15. Their timeline is 2005 for construction. They want to work with the city on the land, building, and how to make it a nice gateway to the city. There is a possibility of having a Visitor Center in combination with the SWMN building. The Liquor Hutch and DWMN will be a beautiful gateway to downtown. 13. Next meeting The next board meeting is January 24, 2003 from 7:00 - 8:00 a.m. A strategic planning session will follow the board meeting from 8:00 - noon. The location will be announced at a later date. 18. Adjourn A motion was made and seconded to adjourn. The meeting was adjourned at 8:50 a.m. Respectfully submitted, Lisa McClure, EDA Intern