07-28-2006 EDAMEDA Board of Directors
Minutes of Meeting
Friday, July 28, 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
I. Mike McGraw 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 June 23rd EDA Board Meeting
Don Walser
Marc Vaillancourt
MIS/P: Hoversten, Walser to approve the minutes from the June 23, 2006 EDA Board meeting as
written. Passed unanimously.
b. Review minutes from June 20`h Finance Team Meeting
MIS/P: Walser, Jansick to approve the minutes from the June 20, 2006 Finance Team Meeting as
written. Passed unanimously.
IV. Review May Financial Statements
Mr. Seppelt gave the following report:
o On Pg 1 under operations for the EDA, there is $226,816 cash on hand. The total fund balance as
of June 30, 2006 is $303,423. 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 $3,000 to date for the year of
2006. Total expenses for the month of June equal $9,243.
o Pg 4 under the EDA Loan Fund, the cash on hand is $119,269.
o Pg 5 under the EDA Downtown Loan Fund, cash on hand is $575,201. Mortgages receivable is
currently $672,368. $66,214 has been collected this year for loan repayments. A total of $20,195
has been paid out thus far in 2006 including loans, downtown grant program, and miscellaneous.
The balance sheet reflects revenues of $46,019 above expenditures.
MIS/P: Walser, Haugen to approve the June financial statements as presented. Passed unanimously.
V. Director's Report
Miles Seppelt gave the following report:
A. Goebel Land Transaction — The city council has approved for the deeding of the property.
B. Industrial Park Sign Project — The project is currently dead in the water. This is mainly due to
various state and city regulations that restrict the use of right of way and the signs purpose. The next
option is to purchase a standard industrial park direction sign from MnDot.
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July 28, 2006
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C. Cornerstone Commons — The construction is back on track. As a result of inspections some structural
modifications had to be made. Mr. Seppelt informed the board that the investors are now encouraging
Marcus Const. more to see a faster return on their investment; this is due to the project being 25% over
budget. This increase in budget costs is the result of material costs increases.
D. Pet Hospital Building — Mr. Seppelt informed the board that there was a meeting with the owner and
their attorney, as a result of that meeting nothing has changed. The owners were not happy with the
cities offer and were encouraged to get their own appraisal. Mr. Seppelt assured the board that there
still is nine months left on the grant window for funding on this project.
E. EDA Budget / Levy — A workshop is scheduled for mid - August to continue working on this option of
funding the EDA via a Levy.
F. Minnesota Investment Network — A meeting is scheduled for August 9t' with Brian Johnson. He will
be discussing RAIN funds and how to utilize them as another funding resource.
G. Web -site Update — Our web site has currently been updated with new building and land information.
Each Building and land site is quick linked to another page that outlines a complete description of that
Location.
H. Downtown Housing — While following the Downtown Master Plan the EDA, HRA, and Southwest
Minnesota Housing Partnership (developer) are currently examining various sites and options around
downtown to redevelop into new housing and business opportunities. The current sites being analyzed
include NAPA, the Depot, Downtown, and Cenex.
I. Business Recruitment
a. Warrior Manufacturing — The purposed building for Warrior is much larger than was
originally anticipated, they are hoping to construct a 76,800 sq. ft. facility. They intend to
break ground this fall and be open and operational by April. The current employee projection
is 10 employees; due to the size of the facility it could be more. Mr. Seppelt is also applying
for a Minnesota Investment Fund grant for $200,000.
b. Nordic Components — They are currently looking for a new facility around 15- 20,000 sq. ft. to
own. They were given a tour of the industrial park. Mr. Seppelt will keep the board up to date
on this project.
VI. Cenex Redevelopment
The Cenex Board of Directors met recently to evaluate their current locations. They have decided that they
would like to sell and consolidate their both their Hutchinson locations into a more centralized location,
Creek Side. The Finance Team recommended that a group be organized to facilitate the process of this
transaction.
MIS/P: Walser, Haugen to elect Mr. McGraw and Mr. Ulrich to head the facilitation of the
transaction with Cenex. Passed Unanimously.
VII. Loan Subordination for Wells Fargo Bank — CGE Properties
Mr. Seppelt informed the board that Mark Sherman (CGE Properties) is in the process of refinancing their
loan with Wells Fargo for the redevelopment of the old Hennen's Building, as part of the agreement the
EDA would subordinate its loan under Wells Fargo's new loan package. Mr. Seppelt reminded the board
that if the properties were to be split at any point a new appraisal would need to be conducted prior to the
transaction to meet the 100% rule.
Note: Steve Jansick abstained from this matter.
MIS/P: Haugen, Hoversten to approve of the subordination agreement with CGE Properties for the
purpose of refinancing. Passed unanimously.
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July 28, 2006
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VIII. Finance Team Vacancy (Dan Carlson resignation)
As a result of Dan Carlson's position at 3M being relocated there is a vacancy on the Finance Team. Mr.
Wurdell President of the First Minnesota Bank of Hutchinson is interested in filling the vacant position.
The Finance Team has approved of his nomination.
MIS/P: Walser, Haugen to approve of electing Mr. Wurdell to the vacant position on the Finance
Team. Passed unanimously.
IX. Grant & Loan Applications
None.
X. Chamber CVB Update
Mr. Seppelt gave the following report:
• Music in the Park has been a great success and there are only a few more events left this
summer.
• Hometown Bargain Days wrap up meeting will be held in the next week.
• The Leadership Institute is entering its 18th season.
• Performance Development Network (Quality Council) is launching new season.
XI. Other Business
None.
XII. The next meeting will be Friday, August 25, 2006 at 7:00 a.m.
XIII. Adjourn
The meeting adjourned at 7:45 a.m.
Respectfully submitted,
Dan Sexton
EDA Assistant