12-01-2006 EDAMEDA Board of Directors
Minutes of Meeting
Friday, December 1, 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 7:03 a.m.
II. Approve Agenda- No action
III. Review and Approve Meeting Minutes
a. Review minutes from November 1st EDA Board Meeting
Don Walser
M/S /P: Jansick, Stotts to approve the minutes from the November 1, 2006 EDA Board meeting as
written. Passed unanimously.
b. Review minutes from October 18 Finance Team Meeting
MIS/P: Jansick, Haugen to approve the minutes from the October 18, 2006 Finance Team Meeting
as written. Passed unanimously.
IV. Review May Financial Statements
Mr. Merrill gave the following report:
o On Pg 1 under operations for the EDA, there is $178,445 cash on hand. The total fund balance as
of October 31, 2006 is $177,453. 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 $4,208 to date for the year of
2006. Total expenses for the month of September equal $14,472.
o Pg 4 under the EDA Loan Fund, the cash on hand is $121,534. The EDA has generated a fund
balance of $146,534 to date the year of 2006.
o Pg 5 under the EDA Downtown Loan Fund, cash on hand is $604,273. Mortgages receivable is
currently $648,386. $95,286 has been collected this year for loan repayments. A total of $26,080
has been paid out thus far in 2006 including loans, downtown grant program, and miscellaneous.
The balance sheet reflects revenues of $69,207 above expenditures.
MIS/P: Hoversten, Haugen to approve the September financial statements as presented. Passed
unanimously.
V. Director's Report
Miles Seppelt gave the following report:
EDA Board Meeting
September 29, 2006
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A. Cornerstone Commons — New Ulm Glass is working on installing the final windows for the second
floor. Mr. Seppelt was notified by the Cornerstone Commons investors that they would be utilizing the
130K loan to gap the construction costs. Quizino's is scheduled to be open for business Tuesday,
December 14tH
B. Pet Hospital Building — The inspection and decontamination of the building has been complete.
Demolition is set to proceed Monday, December 4t'. Mr. Seppelt mentioned that the final purchase
price for the property came to 129K which will be covered by the grant monies, the additional 3K for
attorney's fees, and an additional 3K may have to be paid by the EDA. He commented that this
additional 6K could be paid in the form of a grant.
C. Warrior Manufacturing — The footings and foundation for the building have been poured. Steel is
scheduled to arrive early next week. Warrior Mfg. is still looking at an opening date of April 15, 2007.
D. Business Recruitment
a. Alexis Systems — Staff has currently received the financials from the company. In response to
the financial statements a due diligence packet was created and sent to the company to answer
some under laying questions. Due to a lack of response staff feels this prospect is dead in the
water.
b. Gekko — At the recent CVN conference Mr. Seppelt meet with a new company prospect called
Gekko. Gekko designs pull boats for skiing, tubing, wake boarding, etc. Their boat designs
are current manufactured by other companies, which they are looking to change.
c. American Energy Systems — Is a business currently located in the industrial park that is
looking to add an additional 22 sq. ft. to their facility. Staff has met with the owners to discuss
different opportunities. Plans for the expansion have been submitted to the City of Hutchinson
for approval.
VI. Cenex Redevelopment
Mr. Seppelt informed board members that the EDA appointed negotiation committee is scheduled to meet
with Cenex representatives early next week. Further discussion proceeded pertaining to the expansion of
redevelopment efforts for a larger area other than just the Cenex site. Possible lots included in this larger
area might include a couple of pole structures across from the present Cenex facility to the north and a
house east of the facility.
VII. Property Rental
A. Stritesky Property — Mr. Seppelt recently discussed land rental options with Kurt Reiner for the
Stritesky Property (77 acres). Last year the EDA charged Mr. Reiner $110 an acre to keep the
property maintained.
M/S /P: Haugen, Hoversten to approve the rental of the Stritesky Property for $110 an acre. Passed
unanimously.
B. Goebel Property — Mr. Seppelt commented on whether the EDA would like to rent the Goebel
Property (5 acres) to Steve Reiner. Mr. Reiner has rented the property in the past from Mr. Goebel to
maintain it. Board members discuss the need to develop a coordination agreement with any renter to
prevent problems in the case of development after planting. It was discussed whether the property should
be rent out to Kurt Reiner to alleviate dealing with two different renters.
This matter was tabled till the meeting in March.
L EDA 2007 Budget
EDA Board Meeting
September 29, 2006
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Mr. Seppelt reviewed the proposed 2007 EDA Budget — key points:
• Rental income was projected to decline from $14,122 to $11,122 because Mr. & Mrs.
Wetherell had indicated that they were going to move out of the house located on for the
former Wetherell Property at the end of June.
• The annual transfer of $10,000 from the Downtown Revolving Loan Fund was discussed.
Given that the EDA now had sufficient funds coming from its own revenue source, and in
keeping with the "Matching Principle" of financial management (that recurring dollars fund
recurring expenses and one -time dollars should fund one -time expenses).
• With the levy in place, the EDA will get its first revenue check in the amount of $70,000 in
early July.
• We are paying the intern $11 per hour. This is necessary to attract quality applicants,
especially given that they typically drive down from St. Cloud for work.
• The annual contribution to the Southwest Initiative Fund was discussed. It was decided to
maintain the contribution at the $4,000 level for this funding year.
• The EDA's membership in the "Community Venture Network" (CVN) was discussed. The
advantage is that we get access to 24 businesses each year that are interested in growing and/or
relocating. The downside is that we have not yet been able to recruit any of these businesses to
Hutchinson — although there have been several strong possibilities. Our current membership
runs through May of 2007.
After discussion it was decided that we will keep this item in the 2007 budget, but re- evaluate
whether we should maintain our membership when it next comes up for renewal.
M/S /P: Haugen, Jansick motioned to recommend approval of the 2007 EDA Budget as
presented. Passed unanimously.
VIIL 2007 Projects — Part 1
Mr. Seppelt inquired about any changes or additions that should be made to the plans and goals for
the upcoming year of 2007. Mr. Hoversten mentioned that some additional research should be
conducted in the area of Bio- Science / Renewable Energy, more specifically the Little Falls
facility.
IX. Grant & Loan Applications
Sign & Awning Grant
Grove Street Music Studio — Jason Schooler $2,000.00
M/S /P: McGraw, Hoversten motioned to approval the Sign and Awning Gant as presented for
the Grove Street Music Studio. Passed unanimously.
X. Other Business
- Mr. Hoversten mentioned that there is a Business development seminar scheduled for
Wednesday, December 6t' at the Southwest Initiative Foundation
- Mr. Seppelt informed the board that the Mayor and himself would be traveling to the University
of Minnesota Campus to investigate alternative energy resources.
EDA Board Meeting
September 29, 2006
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XI. Chamber CVB Update
Mr. Seppelt gave the reported the following:
• Program of Work, Integrated Marketing Communication Plan and Budget for FY2007 have
been presented to the Board at our November meeting. Final revisions and approval expected
at the December meeting. Highlights include:
• Focus on increasing membership value
• Focus on increasing "educational" opportunities for members
• Creation of a Public Policy workgroup /committee
• Continued focus on communication with members and other key stakeholders
• Volunteer Appreciation Event scheduled for December 19th (5- 6:30pm) at the Chamber CVB
offices
• Professional Development Network (PDN) January session will feature two -time Paralympian
and National Record holder Judy Siegle on "Living Without Limits" and the March session on
New York Times Best Selling author Ben McConnell on the topics of "Citizen Marketers:
When People are the Message"
• January Session: Wednesday, January 17, 7:30 -9am
• March Session: Wednesday, March 14, 11:30am- 1:30pm
XII. The next meeting will be Friday, December 29, 2006 at 7:00 a.m.
XIII. Adjourn
The meeting adjourned at 7:55 a.m.
Respectfully submitted,
Dan Sexton
EDA Assistant