Minutes - 2009/10/26 - Laserfiche WebLink

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Mounds View City Council October 26, 2009 Regular Meeting Page 4 asked for a firm date and number commitment to assure payments were kept on track. Mr. Moritko stated they were current on the parking lot portion in October. Council Member Mueller asked about the payment of Minnesota sales tax. Mr. Moritko stated he needs product to sell so he sees payment of sales tax as a priority. Council Member Mueller stated the investment of $1.2 million shows Mr. Moritko is earnest in his desire to remain in business in Mounds View. Mr. Moritko stated he took a second mortgage on his house to finance some of the work and a bank note for the parking lot and other improvements. He stated since they purchased the parking lot and added the deck, revenues increased for the first two years but with nice summer weather, deck business goes down. He stated they closed their Coon Rapids location in 2008 and were in good standing with Anoka County at that time. Mr. Moritko stated they dropped the general manager and he came on full time at that point. He noted they could have filed bankruptcy but instead have tried to pay all of their bills including $200,000 of debt from the Coon Rapids location. Council Member Hull asked about the May 1st deadline Mr. Moritko stated it will allow him enough time to catch up and he will send copies of payments made to the City, if desired. He stated this Council has helped other businesses and he is not asking for something they have not done before. Council Member Stigney noted the staff report shows that on October 22, 2009, $70,915.74 was delinquent but paying $7,500 per month from December 1 to May 1 would only equal $45,000. It also excludes the pending payment on May 15th so the numbers do not balance out. Mr. Moritko stated they have earmarked $17,000 for sales tax and will pay any remaining balance. He explained they are constantly looking at financing and working with US Bank on what can be done. Council Member Stigney noted if delinquent taxes are paid by May 1st, another payment is due on May 15th and asked if another extension will be requested. Mr. Moritko stated he is asking their bank to rewrite their note to require escrowing of property taxes so this is never an issue again. He stated US Bank knows they are speaking with the Council tonight and he hopes financing can be completed within 30 days. Council Member Stigney asked Mr. Moritko if he will submit paperwork to the City showing payments to Ramsey County and bank financing. Mr. Moritko stated he will do so and intends to keep communications open so the City is kept updated along the way. Council Member Stigney stated he would like an accounting as of January 1, 2010, before it goes further. Mr. Moritko agreed to that request. Mayor Flaherty stated he can empathize this is a humbling experience and he appreciates Mr. Moritko attending to provide this information. He clarified that the Council has no “power” to close Moe’s but can revisit the liquor license for revocation if the Council finds things are not moving forward. However, the loss of the liquor license would impact Moe’s ability to remain open. Mayor Flaherty noted penalties are due for delinquent property taxes and the City is not letting Mr. Moritko “off the hook” in any way. He stated this business is in trouble and when that occurs, the Council welcomes them to address the issues to see if solutions can be found. Mayor Flaherty stated he appreciates the comments of Mr. Halverson, who is an astute