10-25-2016 EDAMMembers present in bold.
EDA Board Meeting
Main Conference Room — City Center
11:30 AM Monday, October 25th, 2016
MEETING MINUTES
Members
Mike Cannon Corey Stearns
Mary Christensen Mike McGraw
Staff
Miles Seppelt, EDA Director
Matt Jaunich, City Administrator
Andy Reid, Finance Director
Daron Vanderheiden Chad Czmowski
Jonny Block
Call to Order — EDA President Mike McGraw called the meeting to order at 11:35 AM.
II. Approve Agenda
Item IX, "Review of EDA Loan Portfolio," was deleted from the agenda.
III. Review Minutes
A. September 21St Finance Team Meeting
M/S/P: Stearns, Cannon to approve the minutes as written. Passed unanimously.
B. September 28th EDA Board Meeting
M/S/P: Czmowski, Block to approve the minutes as written. Passed unanimously.
C. October 17th EDA Board Special Meeting
M/S/P: Cannon, Christensen to approve the minutes as written. Passed unanimously.
IV. Review of September EDA Financial Statements
■ Cash available in operations is $119,136
■ $56,736 is reserved (proceeds from Warrior land sale) and $62,212 is unreserved.
■ The Economic Development Loan fund has $433,472 cash available and two loans receivable, Redline
Systems and Ashwill industries, both having balances of $15,857.
■ Downtown revolving loan fund has $355,777 in cash available.
o Loans receivable total $566,279 and there is $201,329 in capital assets (Cenex & Wright
properties).
o $30,000 has been disbursed for the EDA contribution to the Signage & Wayfinding project.
o Total assets in the fund are $1,107,207
■ MIF Loan fund has $175,275 in cash available and one loan receivable in the amount of $121,743 (from
NuCrane).
o Unreserved fund balance is $297,018
o Transferred to the newly established Hutchinson Enterprise Center Fund was:
■ $228,000 from Federalized MIF
■ $265,000 from de -Federalized MIF
■ The Hutchinson Enterprise Center Fund has $715,302 in cash available, coming from:
o $493,000 transferred from the MIF Loan Funds
o $250,000 transferred from the City
o Expenditures totaled $27,832 — primarily payment to the architects
■ Shopko Development District #4-5 has $181,483 in cash available and an Interfund Loan receivable from TIF
District 4-16 in the amount of $282,648
o Expenditures were $24,445 — environmental work for the Hotel project
■ TIF District 4-16 had an Interfund Loan Payable to Development District 4-5 in the amount of $282,648.
M/S/P: Block, Stearns to approve the financial report. Passed unanimously.
V. Director's Report
A. Marketing plan FB=151, T = 56
B. Business recruitment / expansions — Staff provided an update on recent prospects and ongoing
conversations.
C. Old Medical Clinic Redevelopment — A developer is coming the first week of November to see the site and
tour downtown.
D. Hotel Project — leak site file closed by MPCA. Staff is working to finalize the Development Agreement with
the Developer.
E. Workforce Development Plan — the new tech -ed area of the High School should be done by mid-September.
VI. Company X
■ Staff reported that Company X may be backing away from purchasing the HTI building in order to pursue
another opportunity. The company President has sent some emails suggesting they are cooling to the idea
of purchasing the HTI building.
■ Discussion followed.
M/S/P: Cannon, Block to establish an date of November 15, 2016 for Company X to accept the offer of economic
development assistance, after which it will be necessary for the EDA to reevaluate the offer due to other opportunities
currently being considered. Passed unanimously.
VII. Hutchinson Enterprise Center
■ Staff reported that bids came in higher than expected.
■ Low bid was provided by Ebert Construction at $2,284,422 (with all alternates included) and $2,038,000 with
no alternates.
■ A key reason for the higher-than-expected bids is the need for significant soil corrections on the site, which
added at least $233,000 to project costs.
■ Staff proposed four options for the Board to consider:
1. Build the original project
✓ most expensive option
2. Build 20,000 sf building with only the most basic of alternates
✓ less expensive, but still over budget
✓ no offices
3. Redesign the project as a 16,000 sf incubator with four bays instead of five. Rebid the project.
✓ No guarantee that new bids would be significantly lower
✓ Might tend to irritate potential contractors.
4. Cancel the project.
✓ No business incubation strategy
✓ We'd lose the DEED grant of $763K
■ Additional funding could be pulled from the downtown SHOPKO TIF District, but this might negatively impact
the Old Medical Clinic Site redevelopment. Staff will have to research this further.
■ The bids are good for 30 days, so no immediate decision is needed.
■ Discussion followed.
■ Consensus was to get more information & input and make a decision on how to move forward on November
215.
M/S/P: Czmowski, Vanderheiden to request that the City Council table action on the bids until its November 22"d
2016 meeting. Passed unanimously.
VIII. TigerPath / Tiger Manufacturing partner event at Zella's
Staff proposed that the EDA sponsor an event at Zella's this coming February for the financial partners in the Skilled
Workforce Development Initiative. Objectives would be to:
■ Update partners on progress of TigerPath & Tiger Manufacturing initiatives
■ Obtain industry feedback on training needs for skilled workforce
■ Obtain industry input on curriculum and equipment
■ Facilitate networking and build relationships between the high school, Ridgewater College, local industry
and EDA.
■ Convey our appreciation for their partnership in this effort
Discussion.
It was noted that this event would be a kickoff event, with further meetings to follow between Ridgewater College,
manufacturers and the high school tech -ed staff.
M/S/P: Cannon, Christensen to authorize up to $1,000 from the EDA operations fund to host the TigerPath / Tiger
Manufacturing Partner Summit at Zella's. Passed unanimously.
IX. Beiriewnf €DALe^ o^ tfolie
X. Grant & Loan Program Applications
Sign & Awning Grant Program
Kelly Jurth Insurance Services LLC $563.72
100 Washington Avenue E., Suite B
M/S/P: Cannon, Block to approve the grant request. Passed unanimously.
Tangles —Val Severson $585.19
1332 nd Avenue SE (right behind City Center)
M/S/P: Block, Vanderheiden to approve the grant request. Passed unanimously.
XI. Other Business — none
XII. Set Next Meeting — 11:30 AM Monday, November 21, 2016.
XIII. Adjourn
M/S/P: Czmowski, Christensen to adjourn the meeting at 12:35 PM. Passed unanimously.
Respectfully Submitted,
Miles R. Seppelt
Economic Development Director