06-23-2006 EDAMEDA Board of Directors
Minutes of Meeting
Friday, June 23, 2006
Members present in bold print:
Members:
Tim Ulrich Steve Jansick Jim Haugen
Duane Hoversten Casey Stotts Mike McGraw
Staff:
Miles Seppelt, EDA Executive Director
Dan Sexton, EDA Assistant
Ken Merrill, Finance Director
I. Tim Ulrich called the meeting to order at 7:02 a.m.
II. Approve Agenda- No action
III. Review and Approve Meeting Minutes
a. Review minutes from May 26th EDA Board Meeting
Don Walser
Marc Vaillancourt
MIS/P: McGraw /Haugen to approve the minutes from the May 26, 2006 EDA Board meeting as
written. Passed unanimously.
b. Review minutes from May 17th Finance Team Meeting
MIS/P: Haugen / Hoversten to approve the minutes from the May 17, 2006 Finance Team Meeting as
written. Passed unanimously.
IV. Review May Financial Statements
Ken Merrill gave the following report:
o On Pg 1 under operations for the EDA, there is $255,827 cash on hand. The total fund balance as
of May 31, 2006 is $236,379. Total Mortgages Receivable is $76,608.
o Pg 2 and 3 is the statement of revenue and expenses. The EDA continues to collect $500 each
month for the Wetherell Property. The EDA has generated a total of $2,500 in the first four
months of 2006. Total expenses for the month of May equal $16,231.
o Pg 4 under the EDA Loan Fund, the cash on hand is $118,704.
o Pg 5 under the EDA Downtown Loan Fund, cash on hand is $570,343. Mortgages receivable was
not updated, so currently shown is $678,867. $58,356 has been collected this year for loan
repayments. A total of $15,195 has been paid out thus far in 2006 including loans, downtown grant
program, and miscellaneous. The balance sheet reflects revenues of $43,161 above expenditures.
MIS/P: McGraw /Haugen to approve the May financial statements as presented. Passed
unanimously.
V. Director's Report
Miles Seppelt gave the following report:
A. Cornerstone Commons — Construction of the project has been stopped pending a Minnesota State
Inspector inspection. More information Pending Monday's meeting with all parties, to discuss 2nd floor
structural and decking concerns.
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June 23, 2006
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B. Pet Hospital Building— There was a joint meeting with city staff, the owner, and her attorney to reach
an agreement. The meeting ended with a stalemate, in which the owner was advised to seek another
appraisal and bids for remodeling the site.
C. Minnesota Investment Network— A meeting will be held on August 9th with Vice President Brain
Johnson of the network will be present to explain this program to all interested parties.
D. State Theater — Mr. Seppelt notified the board that recently the State Theater has been put up for sale.
E. Business Recruitment
a. Warrior Manufacturing— Is hoping to break ground as soon as the end of August.
b. Nordic Components— Nothing new to report.
c. G.R. Creations— Has shown interest in leasing space in the Pro - Maintenance Building.
d. Medisyn Technologies Inc.— Their first round of financing is complete and they hope to
complete the second round of financing sometime this fall.
The Retail Roundtable meeting was held this past Tuesday, were members of the retail community and
public officials meet to discuss the current situation of retail within Hutchinson. All parties present were
asked to generate a list of strengths, weaknesses, opportunities, and threats that they saw as facing
Hutchinson's retail market.
VI. Goebel Property
Mr. Seppelt notified the board that Mr. Goebel had accepted the EDA's offer. The EDA would pay the
assessments on all the Goebel Properties in exchange for the eastern two properties, including the pond.
There was discussion on how the assessments would be paid, with the revenues generated from the Warrior
Mfg. sale. The additional revenues from the Warrior Mfg. sale would be put into a separate fund.
Mr. Merrill explained how the sale and transfer of those properties would work. $37,326.89 would be paid
on existing bonds from 1997 and the rest of the funds would be put into a separate fund ear - marked for
EDA use. This action would be pending the City Councils approval.
MIS/P: Hoversten/McGraw the motion to support the formation of a separate EDA fund for the
revenues generated from the Warrior Mfg. Passed unanimously.
VII. Industrial Park Sign Project— Finance Plan
Mr. Seppelt informed the board that with the use of McLeod Electricity Co -op the cost of the Industrial
Park sign would decrease to $39,290. He also explained the use of a payment play for interested parties to
make the sign more pallet able. Interested parties could either pay a lump sum of $2,800 up front with a
yearly $200 maintenance fee or pay $1,200 up front and $800 the following next two years, again with the
yearly $200 maintenance fee. The Finance Team was supportive of this proposal with the condition of
seven interested parties committed prior to construction.
MIS/P: Haugen /Hoversten the approval of this proposal with the condition that seven interested
parties be committed prior to construction. Passed unanimously.
VIII. Community Advantage Leadership Program (CALP)
Mr. Seppelt explained the CALP program, which is a community based economic structuring program.
The Blandin Foundation and the Southwest Minnesota Foundation sponsor this program. They go to
various communities throughout the state hosting meetings with community leaders, members, and
organizations to assess, priorities, facilitate, and implement strategies for communities to structure their
economic flows. Mr. Seppelt presented the board with a couple question in a fact - finding mission. The
board responded with a good discussion.
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June 23, 2006
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IX. EDA Budget / Levy
Mr. Seppelt present information regarding the History of the EDA's funding and expenditures over the past
nine years. With that orientation he proceeded to explain the current state of funding and how the past
years have been miss represented due to unforeseen situations. He then highlighted the proposed and
project expenditure for 2007 and 2008. With those numbers he was able to represent how much should be
levied if the levy was passed and explained the average cost per house at the average level of $150,000.
In addition to his explanation of the levy structure, Mr. Seppelt justified the need to change funding sources
from general fund transfers to a tax levy because it would make the EDA more transparent to the public.
This type of funding source year to year would be more stable and consistent, which would make it easier
to plan and develop projects. It would also generate a certain amount of cap room in the general fund.
X. Grant & Loan Applications
None.
XI. Chamber CVB Update
Marc Vaillancourt gave the following report:
• The newly named Chairmen Lunch -in was a great success.
• The summer programs sponsored by the Chamber are in full swing, attendance has been great
thus fare.
• Final touches are being made to the Leadership Institute.
• A notification that multiple staff changes are happening in the near future. Those positions will
be posted and hopefully refilled.
XII. Other Business
None.
XIII. The next meeting will be Friday, July 28, 2006 at 7:00 a.m.
XIV. Adjourn
The meeting adjourned at 8:15 a.m.
Respectfully submitted,
Dan Sexton
EDA Assistant