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10-29-2004 EDAMHutchinson EDA Board of Directors Minutes of Meeting Friday, October 29th' 2004 at 7:00 a.m. Members present in bold print: Members: Tim Ulrich Bob Windel Jim Haugen Don Walser Duane Hoversten Keith Fischer Casey Stotts Guests: Tina Vorlicek Steve Jansick Staff: Miles Seppelt, EDA Executive Director Jacki Pillatzki, EDA Intern I. Tim Ulrich called the meeting to order at 7:03 a.m. II. Approve Agenda III. Review and Approve Meeting Minutes a. Review minutes of September 24th' EDA Board meeting. M/S /P: Hoversten, Stotts to approve the minutes from the September 24th' 2004 EDA Board meeting as written. b. No Industrial Park Team minutes for September (no quorum). c. Review Minutes of September 15th' 2004Finance Team meeting. M/S /P: Walser, Stotts to approve the minutes from the September 15th' 2004 Finance Team meeting as written. IV. Review August, September, and December 2003 Final Financial Statements - Finance Director Ken Merrill noted the following items: • Under the September Operations Prepaid Expenses there is $4,000.00 listed as a donation to the Southwest Minnesota Foundation. • Pg 2 of the September financials lists the rental incomes and professional services fees for the month of September. • Ken noted that overall the EDA is doing very well with their 2004 budget. The EDA also reviewed the August 2004 and December 2003 Final Financial Statements. M/S /P: Hoversten, Stotts to approve the August, September and December 2003 Final Financial Statements as presented. 1 V. Update on Allied Mechanical Loan- Attorney Marc Sebora Attorney Marc Sebora updated the Board that Marty Wagoner is willing work on a settlement in return for a release from his legal obligations to the EDA. M/S /P: Walser, Hoversten to authorize Attorney Marc Sebora to negotiate a settlement with Marty Wagoner and to provide him with a release. VI. Directors Report Miles Seppelt gave the following updates: a. BR &E Visits o Impressions — had a very good visit. b. JOBZ Miles attended a DEED Conference on November 7th where he found out that Hutchinson is still eligible to receive JOBZ designation. Miles and Jacki will work on this and update the Board next month. c. Project Updates 1. Streetscaping Project- Materials are being put together that will describe the proposed project and be presented to the public at an Open House in November. 2. Liquor Store- Miles is working on negotiating prices to acquire part of the parking lot and the retail space next to the existing Liquor Store. 3. Rix Corner- Miles is waiting for letters of intent from businesses that will be occupying the first floor. 4. Hutchinson Hotel- Chamber is looking to rent some space on the main floor. Currently the exterior of the Hotel is being refurbished. 5. Industrial Park Update Spec Building Project: The business plan is about 95% done. The next step is to put together a project team to go over the business plan. Miles and Tim will discuss possible members for this project team and get back to the Board. 6. Business Recruitment Update Financial Crimes Technology came out to Hutchinson for a visit to look at potential properties where they could expand their operations. VII. EDA Board Vacancy Miles posted the position online and will be sending a notice to be posted in the newspaper. The Board will look at applicants at next month's meeting. VIII. Grant & Loan Applications Sign & Awnin2 Grant Downtown Clothing Company- Deb Hedtke $2,000.00 M/S /P: Stotts, Walser to approve Sign & Awning Grant in the amount of $2,000.00 for the Downtown Clothing Company. Downtown Commercial Loan Program Hennen's Building — Mark Schierman $130,000 MIS/P: Stotts, Hoversten in recognition of the fact that a) this particular lot occupies an area equivalent to eight or more conventional downtown lots, very nearly an entire city block, and, b) the building occupies the entire lot, making this project unusually large, and, c) the applicant has waived their right to apply for additional downtown loans it is approved that an exception be made to the rule governing maximum loan amounts and that a loan of $130,000 for 10 years at 2.75% be authorized for this particular project. IX. State Theater Loan Due to some unforeseen expenses Red and Linda McMonagle are asking the EDA Board to adjust their loan payments to interest only payments for a certain amount of time. This would allow Red and Linda to have a manageable operating budget during their opening. The EDA Finance Team has sent the following recommendations regarding this request: o That the loan be made "interest only" through December 2005. o The loan payments revert to the original amount of $1,196.17 per month when the interest only period expires, with a balloon payment being due at the end of the loan. The EDA Board reviewed these recommendations from the Finance Team. M/S /P: Hoversten, Stotts to approve Red and Linda McMonagle's request to make the loan payments interest only through December 2005 after which the loan payments would revert to the original amount; the term of the loan will remain unchanged with a balloon payment at the end of the loan. X. Authorization to Obtain Appraisal of Cenex Properties / Establish Project Team With Cenex possibly interested in consolidating their operations out to the Industrial Park the EDA would have an opportunity to purchase the other Cenex properties. Cenex has appraisals on all of their properties. The next step for the EDA would be to have their own appraisals done on the Cenex properties. Discussion of a possible project team took place. Miles and Tim will discuss possible team members for project team at a later date and will get back to the Board. M/S /P: Hoversten, Stotts to authorize appraisals for Cenex Properties and the Stritesky Industrial park property. XI. Update of Economic Development Loan Program Guidelines The Board discussed proposed updates to the Economic Development Loan fund guidelines and application materials. M/S /P: Stotts, Walser to approve the updated guidelines and application materials for the Economic Development Loan Program Guidelines. XII. Consideration of Industrial Park Declarations The Declarations provided by the Industrial Park Team were reviewed and discussed. Concerns were raised over the impact of the new building standards on small businesses and new businesses. After further discussion, the EDA Board decided to send the proposed Declarations back to the Industrial park Team to so they could consider this issue and formulate a solution. XIII. Previously Requested Information Report: Expanding & Re- capitalizing the Revolving Loan Fund Report: Cost - Benefit Analysis of Land Write -Down Program Report: Glenco's Industrial Park Program XIV. Chamber update Location Update- the Chamber is looking at acquiring the front 1/3 of the Hutchinson Hotel. Staff Update- available positions have been posted for the CVB/ Chamber President as well as for a Chamber Administrative Assistant. XV. Other business None XVL Set next meeting The next meeting was set for Friday, December 3rd° at 7:00 am. XVIL Adjourn The meeting adjourned at 8:31 a.m. Respectfully submitted, Jacki Pillatzki EDA Intern C!