08-08-2005 - Laserfiche WebLink

Home Browse Search

Mounds View EDA August 8, 2005 Regular Meeting Page 7 President Marty referenced Page 8, Section 3.3, Business Subsidies Act, Item 2, states that ‘if the goals are met in part the developer would pay a portion of the business subsidy, plus interest, determined by multiplying the business subsidy by a fraction, the numerator, of which is the number of jobs of the goals which are not created at the wage level set forth above and the denominator, which is 40’ and clarified that if they do not create the jobs they state then they would pay the City interest back. Economic Development Coordinator Backman stated that they would have to re-pay a portion of the business subsidy plus interest. He explained that it holds their feet to the fire in the sense that the City wants to have job creation and that the City has expectations about the wage levels. Commissioner Flaherty stated that when this first came up at the EDA Commission hearing he was not very happy because it came on the heels of everything else when the EDA was talking TIF D istrict as far as Medtronic was concerned. He explained that they had decided as a Commission that they wanted to review the TIF Districts and determine what exactly the TIF Districts are earning and exactly how much the City has in districts. He stated that this is a bit quick for him noting this came back up again before they have had an opportunity to review where the districts are, where they are going, where they want to decertify and what funds the City has with the increment monies. He stated that he is still of this mindset noting that it is quick for him coming on the heels of the Medtronic deal. Commissioner Thomas stated that she is still going back and forth on this noting that she has expressed concerns in the past with regards to spreading the payments out, when knowing what they want to do and understanding still the cash flow issues, what they want to do with the funds. She stated that she tends to agree with Vice President Stigney. She noted that this is a difficult situation and suggested, as a compromise, a 50-percent split taking it down to a two-year spread She stated that it is her understanding that they have the cash flow, at that point, in that district, without taking it too far out. She stated that this would cut it down to a reasonable planning level for the City without dragging it out and allows the City to cash flow some items to get the project going. She noted that they couldn’t wait until next year adding that this is where she believes the City is in trying to manage a compromise. President Marty stated that he spoke with Phil Seipp, President/CEO of SYSCO, earlier this afternoon noting that Mr. Seipp explained that this is time sensitive and if this doesn’t go through, their cap is approximately $1 million and in reviewing the spreadsheets the amounts were over $300,000 and the criteria that SYSCO uses is that if they can keep it under $1 million they would get the funds from their corporate headquarters, if not SYSCO might be looking to invest in their money in other areas, possibly outside of the State of Minnesota. He stated that he sees SYSCO as being a very good neighbor and strong business here in Mounds View and it is not like they are asking for millions of dollars. He stated that they pay their taxes and they have been a growing business and sees this as a positive way that the EDA Authority and City could