02-28-2003 EDAMHutchinson EDA
Board of Directors
Minutes of Meeting
Friday, February 28, 2003
Members present in bold print
Members:
Tim Ulrich Bob Windel Jim Haugen Don Walser
Jeff Haag Duane Hoversten Keith Fischer
Guests:
Ken Merrill, Finance Director
Marc Sebora, City Attorney
Staff:
Amanda Alfson, EDA Intern
Miles Seppelt, EDA Director
1. Tim Ulrich called the meeting to order at 7:15 a.m.
Matt McMillan Vi Mayer
2. Consideration of minutes from the January 24, 2003 meeting.
Number 7 D should read, "have" not "hves ". Number 12; line 7 should say "obtain" not "submit ".
M /S /P: Hoversten, Fischer to approve the minutes from January 24, 2003 with the above
corrections.
3. Review and approval of Finance Team minutes from February 19, 2003.
M /S /P: Windel, Haugen to approve the minutes from February 19, 2003.
4. Review Financial Statements
Ken Merrill was unable to attend the meeting. Miles Seppelt summarized the included statements. As of
January 31, 2003 page one on the balance sheet listed $197,821 in cash. Total assets were $338,900.
Total revenue on page two was $127,500. On page three it is showing our expenditures for the month of
January as $9,480. Page four is showing $189,531 as unreserved funds. Total assets on page five list
$1,316,288. Available funds are totaling $384,698. Revenues for the downtown loan fund equal $6,591.
Miles will be checking with Ken for the explanation of the reserved and unreserved fund.
M /S /P: Windel, Fischer to approve the financial statements as of January 31, 2003.
5. Directors Report
Miles Seppelt gave his report
A) All loans are up to date.
B) Business visits
• Miles has met with Hutchinson Technologies and AmericInn.
C) State Theatre
• The serious prospect is a business owner from Wayzata looking to run a theater. It would
be run as a second -run theater. The individual has flown out many professionals to look at
the improvements that will need to be made to the movie projectors and other equipment.
The total cost for the project is approximately 1.3 million dollars. This project will
qualify for a redevelopment TIF and is also eligible for the downtown loan fund. Miles is
checking into a possible SBA 504 loan as well as the Southwest Minnesota Foundation.
Mid - Minnesota may be an option.
D) Liquor Store
• The City Council has chosen the site. There will be a meeting on Monday to set up the
next step. Miles has spoken with Ken about financing and an inter -fund loan may be an
option.
E) Hutch Hotel
• Miles has met with Jeff Haag. They are interested in moving forward this summer.
F) County EDA Project
• Miles continuing to research this project.
G) Industrial Park Team
Cary Linder and Miles have sent out letters to dissolve the old team. They have chose
members for a new team and have sent out letters inviting them to join. Miles will be
finalizing the team with Cary later today.
H) Micronics
• This business is still looking for a location to build. A suggestion was made to contact
Mr. Bob Peterson about purchasing a portion of his land.
I) Project List
1) Municipal Liquor Store
2) State Theater
3) Industrial Park
4) Business Subsidies Criteria
5) Downtown Revitalization Plan and Special Services District
6) Develop new EDA Web -site
7) Business Recruitment
8) Nook `N Cranny
9) County EDA
10) Administration / Requests of Information
6. Business Recruitment Update
A. Community Venture Network (CVN)
Miles and Amanda Alfson attended a CVN meeting in Brooklyn Center on February 10, 2003.
Cities and counties join CVN for $3, 950 /year to attend four meetings. Six, pre- screened
companies present to an audience of economic developers at each of the four meetings. At the
end of the presentations, economic developers discuss details with the company(s) they are
interested in (i.e. location, wages, etc.) Becoming a member of CVN would provide solid
business prospects each year. If the city became a member, Miles and a board member could
attend the meetings. The board determined that $3,950 was an affordable way to market the
community. The finance team recommended joining CVN.
M /S /P: Fischer, Haugen to join the Community Venture Network.
Miles will check with Ken to determine budget obligations.
7. Industrial Park Update
Marc Sebora gave the board an update on the condemnation process. Larry Frazier, David Broll and
Brian O'Donnell were appointed as primary commissioners. Janet Killian and Ken Sorenson were
chosen as alternates. This group must give their opinion to the judge in 90 days of what the price is.
The other party will either accept or reject the primary commissioners recommendation. If they reject, it
will go to court. The right of entry on the property on March 5, 2003. It was decided that Cary should
attend EDA Board meetings in the future to keep the board updated.
8. Industrial Park Team Update
As mentioned in the above director's report, Cary and Miles have sent out letters to dissolve the old
team and are in the process of building a new team.
9. Update on Business Subsidies Criteria
In 1999, the state legislature passed a law requiring each legal entity providing business subsidies to hold
a public hearing and establish criteria for the awarding of such public assistance. The law also
established reporting requirements.
In 2001, the legislature revised the law and required grantors of "business subsidies" to adopt more
stringent guidelines that specifically discussed job creation and wage goals.
Local governments have until May 2003 to comply with the new statute.
10. Review Downtown Loan Program Guidelines
As the program stands, the maximum loan amount that can be approved is $65,000 per lot, with no more
than $20,000 being spent on interior improvements. Several projects identified by the downtown master
plan are large in scale and need more assistance than can be provided by the current loan program. The
goal would be to try to balance the options for both small and large projects. The board still has the
option to approve special projects and allocate additional funds. Miles will put together a proposal to
change the guidelines to go by dollar value of project in $25,000 increments.
This item was tabled until March 28, 2003.
11. Update on Special Services District
Miles and Amanda are researching assessment options including assessing by property values and
commercial square footage. Amanda is entering information into a database to help us better evaluate
our options. The goal would be to find the most fair and marketable option that could be authorize and
adopted. The SSD would have to be adopted by August to be eligible for 2004. The board mentioned
possibly expanding the downtown boundaries to match the SSD. Problems at this point include
determining how to assess and choosing what the SSD money would be spent on.
12. HCDC as Legal Entity
The "Hutchinson Community Development Corporation," was formed in 1982 to coordinate economic
development efforts in the City of Hutchinson. This corporation still exists as a legal entity and must be
renewed with the Secretary of State's office on a regular basis. The city's economic development
authority has all the legal powers of the Corporation and more. Consequently, there appears to be no
reason to maintain the Corporation as a separate legal entity.
The proposed action would be to dissolve the HCDC's legal status as a "Corporation" but retain and
promote the moniker of the HCDC as the Hutchinson Community Development Commission due to it's
historical significance and symbolism.
M /S /T: Haugen, Windel HCDC as legal entity until March 28,2003
13. Annual Meeting
The annual meeting for this year will be held in the fall. The date and details will be determined in July.
Past meetings have entertained 60 -85 people as a luncheon at the Country Club.
14. New Business
A) Vi Mayer gave the following Chamber report:
State legislature conference call revealed that the governors proposed budget may not cut
Transportation funds and the Hwy 7 project should go through as planned. Property taxes
will be frozen.
• A variety of bands are being hired for Music in the Park.
Arts and Crafts Festival is 80% full.
MNSCU recommendations are due by April 15, 2003 in the search for a Ridgewater
College President.
• Lighthouse Bookstore will either be sold or closed.
Unity Uniform is leaving their current location.
B) The Governor's budget recommendations show severe cuts in local government aid (LGA). The City
of Hutchinson will take a 1.4 million dollar cut over the next two years. Hutchinson gets below
average LGA on per capita basis but is taking the second largest cut in the state. Coping strategies
include challenging the cut assumptions. It is possible that the cuts were based on revenues that are
actually partnerships.
15. Set next meeting
The next board meeting is scheduled for March 28, 2003 at 7:00 a.m.
16. Adjourn
Board meeting was adjourned at 8:55 a.m.
Respectfully submitted,
Amanda Alfson, EDA Intern