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Draft EDC Minutes November 20, 2015 Page 3 of 8 The next section explains the application process. An applicant must provide their information on the preapproved application forms. Staff will work with the city’s financial consultants who will review at least two years of the company’s financial statements to verify a gap in financing the project. Other deletions in the policy are to eliminate wordy and confusing language. The last section is the reporting requirements. Beeman explained that the city is required by law to report wage and job goals to the state each year and sometimes the company owners are not located in Minnesota and have multiple locations around the country and even in other countries. Retrieving this information can be daunting. In order to have some leverage, Beeman has place language in the policy allowing the city retribution in cases where companies are not cooperative in their required reporting to the city. If the city misses the annual statutory reporting deadline then the city could lose its ability to subsidize businesses. Beeman noted the other deletions were to eliminate confusing and wordy language. The city attorney will review the policies before the EDA sees them to verify the changes and ensure the statutory language. The EDA will make the final determination whether to accept the amended policy or not. Beeman noted that it is always good to have another set of eyes review the policies and perhaps the EDC, especially those that have been on the EDC for a while, may recall instances in the past that may dictate other language in the policy. Beeman asked the EDC if they had any questions or suggestions concerning the policy. Chair Helgemoe asked Beeman to explain the last time a business subsidy was applied for in the city. Beeman noted that to his knowledge Medtronic was the last applicant to apply for a TIF and that was approximately 7 years ago. As of the end of 2015 the city will have decertified all of the other TIF districts leaving the Medtronic TIF district as the only remaining district. Beeman explained that there was a potential TIF applicant for the Skyline Motel project for a light industrial project. However, it was determined that the ratios weren’t high enough to justify the use of TIF and they city didn’t feel comfortable at the time in subsidizing a property owner who is unwilling to negotiate. In these situations it is more of a policy decision to get rid of blight and substandard conditions, rather than job creation. Helgemoe asked for questions from the Commission. The commission felt that Beeman has done a good job researching and preparing the update. Hearing no questions Helgemoe asked how the review of financial statements is handled and should that be defined in the policy. Beeman said he had included that language in both the TIF and Tax Abatement policies. Beeman explained that the city’s financial consultant will review the financial statements to verify any gaps in financing the project. Using a third party financial consultant serves two purposes. It protects the city in case of a legal dispute and it allows the financial statements of a company to be reviewed through a non- disclosure agreement so that the company’s financials remain non-public. The consultant will then provide a memo to the city confirming that they have reviewed the financial statements along with their findings. Doing it this way is a win-win for the city and company being evaluated for public assistance.