08-24-2016 EDAMMembers present in bold.
EDA Board Meeting
Main Conference Room — City Center
11:30 AM Wednesday, August 24th, 2016
MEETING MINUTES
Members
Mike Cannon Corey Stearns
Mary Christensen Mike McGraw
Staff
Miles Seppelt, EDA Director
Matt Jaunich, City Administrator
Jeffrey Page, Program Assistant
Daron Vanderheiden Chad Czmowski
Jonny Block
Call to Order — The meeting was called to order at 11:33 AM.
II. Approve Agenda — no action
III. Review Minutes
a. July 20th Finance Team Meeting
M/S/P: Stearns, Block to approve the Finance Team minutes as presented. Passed unanimously.
b. June 22nd EDA Board Meeting
M/S/P: Czmowski, Christensen to approve the EDA Board minutes as presented. Passed unanimously.
c. July 27th EDA Board Meeting
M/S/P Block, Stearns to approve the EDA Board minutes as presented. Passed unanimously.
IV. Review of July EDA Financial Statements — Miles Seppelt, EDA Director
■ Cash available in operations is $148,831.
■ $56,736 is reserved (proceeds from Warrior land sale) and $90,968 is unreserved.
■ In the Statement of Revenues & Expenditures, under expenses, staff reported that the $1,957 on "other
professional services" was mostly related to the financial analysis done by Ehlers & Associates for the
Hotel project.
■ The Economic Development Loan fund has $431,889 cash available and two loans receivable, Redline
Systems and Ashwill industries, both having balances of $16,291.
■ Downtown revolving loan fund has $368,553 in cash available.
■ Loans receivable total $580,847 and there was $201,329 in capital assets (Cenex & Wright properties).
$30,000 is reserved for the EDA contribution to the Signage & Wayfinding project.
■ MIF Loan fund has $956,324 in cash available and one loan receivable in the amount of $132,590 (from
NuCrane).
■ $300,000 is carried as "Accounts Payable" for the CTE Equipment Purchase initiative.
■ Unreserved fund balance is $788,915.
■ Shopko Development District #4-5 has $217,024 in cash available and an Interfund Loan receivable from
TIF District 4-16 in the amount of $270,600.
■ TIF District 4-16 had an Interfund Loan Payable to Development District 4-5 in the amount of $273,300.
M/S/P: Cannon, Vanderheiden to approve the financial report as presented; passed unanimously
V. Director's Report
Marketing Plan Report: Website updates = 0, Facebook updates = 15, Twitter activity = 15
Social media effort has 148 followers on Facebook and 52 on Twitter.
Business recruitment / expansions: Staff provided an update on recent prospects and ongoing conversations.
• A high tech manufacturer is very interested in Hutchinson but the project is in jeopardy because the State Legislature
cut funding for the Job Creation Fund, which was needed to help the company move to Hutchinson.
• Staff will be visiting with the company president on Friday to see if there is any way to salvage the deal.
Downtown Signage project: footings should be going in next week, signs up by September 15th
Old Medical Center Project Update:
• Staff met with a Twin Cities developer whose potentially interested in building 80 market -rate apartments on the site.
• Developer would need more space however, 2 acres instead of the 1 acre available.
• The Developer indicated that the project could be done as two separate buildings.
• Developer will probably be coming to Hutchinson in late September to see the site & downtown area first hand.
VI. Hotel Project
Staff provided the following update:
■ A revised engineering estimate indicates that it would cost approximately $365,000 to construct the 550' of
access road off of Prospect Street and provide the needed slope stabilization.
■ A slope stabilization project would replace the retaining wall next to Prospect Street and save about
$50,000.
■ The driveway entrance off Prospect Street will be moved closer to Hwy 7.
■ A development agreement is currently being put together and will be forwarded to the developer hopefully
early next week, after the City Attorney has had an opportunity to review it.
■ Staff's goal is to have the Development Agreement and Purchase Agreement signed by mid-September.
Discussion followed.
Staff discussed potential sources of project funding, including using $100,000 of tax increment from the SHOPKO TIF
district to help with the construction of public infrastructure.
VII. Workforce Development Plan
■ Towmaster (from Litchfield) has become a company partner, providing a trailer that will be used to transport
a "tiny house" that students will construct this year.
■ Between 21 partners over $1,198,350 has now been raised for the project.
■ A project implementation team comprised of Daron Vanderheiden, Mike Boehme, Tom Mayer (from 3M)
Mary Hodsen and EDA Staff meets every other Friday. Being worked on are:
o Goals & Outcomes
o Tiger Manufacturing
o Marketing
o TigerPath Coordinator
o Certifications (MSSC, AWS, NIMS, etc.)
■ SWIF provided a $10,000 grant to the Hutchinson EDA for implementation of Tiger Manufacturing.
M/S/P: Block, Stearns to authorize release of those funds to ISD 423 to be used in the establishment of
Tiger Manufacturing. Passed unanimously.
■ A total of $653,450 cash is on hand for implementation of the project, with the rest coming in over the next 2
'/2 years from company pledges.
VIII. Hutchinson Enterprise Center
■ Staff reported that the pre -design and legislative approval steps have been completed and the architects are
working to get through the SB2030 energy efficiency process as soon as possible.
■ Design of the building is essentially complete, with only final details to be worked out.
■ Braun Intertec did soil borings on the project site and found that rather poor soils conditions exist — at
present they are too soft to support the building and significant soil corrections will be needed.
■ Discussion followed and it was decided to push ahead with the current site.
Staff estimated that it would be it the neighborhood of $140,000 additional cost to make the necessary soil
corrections. This could be covered by:
o Project contingency funds
o Deleting the office area if needed
o Utilizing dollars from the SHOPKO TIF District to do needed soil remediation
By the time the site plan approval process and the bidding process was competed we're probably looking at
a late October start -date for construction.
To save time on the project Staff discussed the idea of having needed site grading work done in advance.
The city is allowed to secure quotes (as opposed to securing bids) for projects that are less than $100,000.
Getting the site grading done in advance could save 7-10 days of construction time later on.
M/S/P: Stearns, Block to authorize staff to secure quotes and move ahead with site grading if it is
reasonable and prudent to do so, the project cost is less than $100,000 and if it would save time on the
project. Passed unanimously.
■ Staff updated the Board on discussions with the Northwest Regional Planning Commission in Wisconsin.
They are claiming the building design is their intellectual property. Our attorney and architects disagree.
■ Further discussion.
IX. Grant & Loan Program Applications
Siqn & Awning Grant Program
Fringe Hair Studio — Denise Schramm (Scott Glaser, property owner) $1,000
225 Main Street South
M/S/P: Block, Vanderheiden to approve the grant request. Passed unanimously.
X. Other Business
■ Staff was asked to check on the condition of the Old Medical Clinic site, which was looking rather weedy and
unmaintained.
XI. Set Next Meeting — 11:30 AM Wednesday, September 281h, 2016.
XII. Adjourn
M/S/P: Cannon, Block to adjourn the meeting at 12:55 PM. Passed unanimously.
Respectfully Submitted,
Miles R. Seppelt
Economic Development Director