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HomeMy WebLinkAbout2006.08.21 EDA Packet AGENDA CITY OF HUGO ECONOMIC DEVELOPMENT AUTHORITY MEETING MONDAY, AUGUST 21, 2006- 8:30 AM HUGO CITY HALL 8:30 am 1. Call to Order 8:31 am 2. Roll Call 8:32 am 3. Approval of Minutes EDA meeting of July 17,2006 8:35 am 4. Postal Credit Union Special Guests: • Russell Plunkett, President • Dennis Bauer, EVP Finance • Jeanine Swanson, SVP-HR • Patty Kamas, Business Development Manager 9:15 am 5. Discussion on TIF District Establishment 9:45 am 6. Update on Eminent Domain Law 9:50 am 7. Update on the Schoeller Property 10:00 am 8. Update on the End Zone Property 10:30 am 9. Adjournment BACKGROUND MEMO FOR THE EDA MEETING OF Monday, August 21, 2006 3.Approval of Minutes EDA meeting of July 17, 2006 City staff recommends that the EDA approve the minutes for the July 17, 2006 EDA meeting as presented. 4. POA-Scherer & Collaborative Design Group—Postal Credit Union POA-Scherer, LLC and Postal Credit Union are requesting approval of a Preliminary Plat and PUD General Plan to construct a 5,000-square foot bank with drive-through tellers on a 1.62 acre lot located west of Festival Foods across Victor Hugo Boulevard. The Planning Commission held the public hearing at its August 10, 2006 meeting and voted unanimously to recommend approval. Staff will show elevations of the building and the Postal Credit Union representatives will be present to talk about the bank and answer any questions the EDA may have. The Staff recommends the EDA welcome the Postal Credit Union as a new business in the community. 5.Discussion on TIF District Establishment Staff has been working closely with Paul Steinmen of Springsted and Mary Ippel on the calculations to establish a TIF District. Staff has attached a map of the proposed TIF District that highlights the buildings that meet and do not meet the required 15%code deficiency threshold determined by building inspections. The buildings are highlighted blue if they qualify and are highlighted red if they do not qualify. Staff will give an update at the meeting on the coverage test and will request direction from the EDA related to proposed TIF boundary. 6. Update on Eminent Domain Law Staff has attached an update from the League of Minnesota Cities of the current legislation on eminent domain. 7. Update on the Schoeller Property Staff was successful in reaching an agreement for the purchase of Schoeller house at 5399 Street for$135,000. The City will be responsible for demolition costs in excess of the$15,000 agreed to by the Schoeller family. Because the Schoeller family was selling the property, Council agreed to purchase the house for the future extension of Finale Avenue, north from the new CSAH 8. Staff has attached the final purchase agreement between the City of Hugo and the Schoeller family. 8. Update on the End Zone Property In mid-July 2006, City staff inspected the End Zone restaurant and motel and observed a condition of slum and blight, including the open doors at the motel revealing refuse, debris, and junk. City staff sent property owner Alex and Zena Minich a certified letter requesting that the property be cleaned up and secured by Friday, July 28, 2006. Alex and Len Minich met with City staff on Friday, July 28, 2006, at City Hall, and discussed the issue and staff provided them a demolition application. To date,the Minich's have not done anything to clean up or secure the motel buildings. Under Minnesota Statute, the City's chief building official has the jurisdiction under which to request the immediate removal of a public health, safety hazard, of which staff has determined that this property has presented itself as. Alex and Len Minich were present at the August 7, 2006 City Council meeting stating that they had filed for a demolition permit with the City for the two motel buildings and the house. The bar/restaurant building will remain. Staff has attached the letters sent to the Minich's including the letter stating they have 30 days to remove the buildings. MINUTES FOR THE EDA MEETING OF JULY 17, 2006 EDA President Fran Miron called the meeting to order at 8:40 am. PRESENT: Jan Arcand, Fran Miron, Phil Klein, and Tom Denaway ABSENT: Mike Granger,Jim Bever City Administrator Mike Ericson, CD Director Bryan Bear, CD Intern Rachel Simone APPROVAL OF MINUTES Arcand made motion, Klein seconded, to approve the minutes for the EDA meeting of June 19, 2006 as presented. All aye. Motion Carried. INTRODUCTION OF BRIAN THISTLE,RECOMMENDED FOR APPOINTMENT TO THE EDA At its June 19`h, 2006 meeting, the City Council accepted the letter of resignation from EDA Commissioner Nick Skarich who resigned his position due to a change in his employment and relocation. City staff advertised for the position and with the concurrence of Mayor Fran Miron the Staff conducted an interview with Brian Thistle. City Staff is comfortable with Mr. Thistle and will recommend approval of his appointment to the EDA at the July 17, 2006 City Council meeting. Bryan Bear stated that staff had in introductory meeting with Brian and felt he would be a good fit for the EDA. Miron talked about the application process. Brian Thistle was present to answer any questions and staff introduced him to the EDA. The EDA had some questions about why he was interested in joining the EDA and what he thought that Hugo needed in the community. Brian stated that he wanted to be involved with the community and thinks that the city needs more amenities for the residents. UPDATE ON SCHOELLER PROPERTY At its June 19, 2006 meeting the Council directed staff to negotiate with the Schoeller Family for the purchase of the property, with terms and conditions flexible. Staff has met with Lois Mahlberg and Paul Schoeller, the estate holders of the property located at 5399 145th Street and successfully negotiated the purchase of the property. Staff drafted a purchase agreement for $150, 000 and the property owner would be responsible for the costs of the demolition that would be subtracted from the purchase price. The purchase agreement was approved by the City Council and has been signed by the estate holders with a closing date set for August 1, 2006. Bryan Bear gave an overview of the purchase agreement and the condition of the Schoeller property. Miron asked if the way we are handling the demolition cost would affect the use of the TIF money. Denaway stated we may not be able to receive the money for the demolition costs from TIF. Bryan Bear stated that staff will look into this issue. UPDATE ON PROPOSED TEXT AMENDMENTS At its July 13, 2006 meeting, the Planning Commission reviewed two ordinance text amendments that were initiated by the EDA. Rick Burr has sent the City a letter stating that he would like to expand his existing business, Gusset Design Inc. at 15587 Forest Blvd. The property is zoned Commercial but the building use is Industrial. The structure was built before the zoning changed to a Commercial District so it is allowed to remain. According to the City Municipal Code, it states that the business is not allowed to expand because the use is nonconforming to the current zoning. This issue was brought to the EDA and the City Council and both suggested having a meeting with the surrounding property owners to determine what their thoughts were on rezoning the properties back to industrial. Almost all property owners stated that they wanted to keep the current commercial zoning. Staff brought this subject back to the Council on its June 5, 2006 meeting reporting on what the outcome was of the meeting with the surrounding property owners. The Council directed staff to draft an ordinance text amendment to allow the expansion of legal non-conforming commercial/industrial uses for consideration by the Planning Commission at a public hearing. Staff drafted an ordinance text amendment and recommended approval. It was unanimously approved by the Planning Commission to the City Council. Kian Jalali and Spencer Grundhoffer have proposed a concept plan for a meat market and meat processing business located at 15449 Forest Boulevard. They plan to keep the existing building located directly in front of Just Two Bikes and plan to renovate the inside for the meat market and processing facility. The property is currently zoned General Business (C-2) and a meat market is a permitted use in the ordinance, but the meat processing portion is not allowed. At the June 19, 2006 City Council meeting the Council reviewed this issue and directed staff to draft an amendment to the ordinance to allow meat processing as an accessory use to a meat market with a Conditional Use Permit. Staff drafted a text amendment and recommended approval. It was unanimously approved by the Planning Commission, with conditions, to the City Council. Rachel Simone provided the EDA with the details of the text amendments in a presentation and asked for comments on the amendments. Arcand stated that a lot of people in the city want to expand their business and we should let them do so, so they stay here. She also stated that the city may be in legal trouble if we do not let any of them. Bear stated that he likes the way the text amendment is structured and he gave the example of businesses being allowed to expand and bring outdoor storage inside. Miron stated that other cities do this and he thinks we should do it. Denaway stated that we need to be careful of what we do with letting these businesses expand, if we allow all of them to do this, the area will never redevelop. Bear stated that several of these properties need renovations and this may be the way to encourage this. Arcand stated that the EDA wants to see these businesses stay in Hugo. Arcand stated that at the Forest Lake meat market picks their garbage two times a week, but if the city has the right to enforce them to dispose of the garbage when needed, one time a week may be enough in this case. Miron stated that in the summer that the disposal may have to be more frequent. Bryan Bear stated that the main issue is the animal remains odors. Klein was concerned with the staging areas and the animal remains in the heat also. Bryan Bear stated that these issues can be addressed in the CUP. UPDATE ON DOWNTOWN REDEVELOPMENT Bear gave an update in the TIF district establishment and the tests the staff is working on to meet the TIF requirements. Staff will have most of the calculations done by next months EDA meeting. Bear also gave an update on the antique shop closing and that the Andersons are working with a development group to redevelop the property. UPDATE ON END ZONE PROPERTY Staff provided the EDA with an update of the End Zone property. Bear stated that the last time staff met with the Minich's a clinic gave them a purchase agreement to sign,but not much happened with them. Mike Ericson talked about the condition of the buildings and that staff is having the property inspected by the County Health Department on July 18, 2006. Miron stated that this is a good move and the residents of the City have been asking about the property and why nothing is has been done. MISCELLANEOUS Klein wanted to inform the EDA staff that the Hugo Business Association is setting up a website and would like to have a link on the City's webpage. ADJOURNMENT Klein made motion, Arcand seconded to adjourn the meeting at 10:00 am All aye. Motion carried. CITY OF HUGO COMMUNICATIONS LIST August 2006 Economic Development Authority Name Term Expires Fax Number Home Phone Address (six year terms) E-Mail Address Office Phone Fran Miron, President 15250 Homestead Ave. 12-31-2006 °� (651)429 5961 Hugo, MN 55038 _40 bw A y N ; Michael E. Granger (651)426-8171 12715 Ethan Ave. N 12-31-2008 (651)653-4631 (651)653-4648(work) White Bear Lake, MN 55110 mike(a)streetsmartrental.com (612)805-5751 (cell) Jan Arcand, Treasurer J 1850 Cedar Avenue, 12-31-2006 (651)653-6402(fax) (651)429-2930 White Bear Lake, MN 55110 Jim Bever (651)426-2240(home) 7131 132nd St. N 12-31-2008 (651)426-5809 (651)307-3578(cell) White Bear Lake, MN 55110 Phil Klein, Vice President (651)653-7152 6760165 1h St. 12-31-2009 philklein7(a)msn.com (651)2464024(cell) Hugo, MN 55038 Brian Thistle (651)762-3945 4624 Fable Hill Pkwy 12-31-2010 brianthistle@edinarealty.com (612)306-4993(cell) Hugo, MN 55038 Tom Denaway 4385 Empress Drive N.#1 12-31-2007 tdenawayCq_)hotmail.com (763)2184338(cell) Hugo, MN 55038 CITY STAFF: Community Development Director Bryan Bear— Executive Director City Administrator Mike Ericson — Secretary Finance Director Ron Otkin — Assistant Treasurer \Communication List\EDA\082106.doc N / AP F 1, _ R ,n o I i / r»�' ,..,»,rid / *V.•..,.,, '�"s --^-"�....,� � t � `y` _ >>,Ar, �1r1 ikrA 41LL3i " _ u - I TH • tel t � 02006 Westwood Professional Services, ine Call 48 Hours before diggtnq: f' , GOPHER STATE ONE CALL /✓�,t` Twin City Area 651-454-0002 Mn. 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SIGNAGE STONE CAP PROJECTED BRICK COL.BASE BRICK CONCRETE CURB QUIONS, O TYP SEE 1/A3.1 FOR MATERIAL NOTES DRIVE-THRU BANK EQUIP. 2 NORTH ELEVATION A3.1 SCALE va=r o PREFIN.ALUM.FLASHING PREFIN.METAL FRAMED SKYLIGHT STONE CAP ON WALL ASPHALT SHINGLE i I i I PREFIN.METAL ROOF I PREFIN.METAL WINDOW CAST ARCHITECTURAL STONE PARAPET CAST STONE PARAPET STONE BELT LINE CAST ARCHITECTURAL STONE STD.BRICK STONE BELT LINE PREFIN.METAL CLAD WINDOWS STONE FRAME STONE LEDGE CAST ARCHITECTURAL STONE IER COURSE STONE LEDGE CAST ARCHITECTURAL STONE CAST ARCHITECTURAL STONE STONE HEADER PREFIN.ALUM.ENTRY SYSTEM 1 EAST ELEVATION A3.1 SCALE:1/8'=1'-0' n 5 ® \ A3.1 METAL PANEL CLADDING I PREFIN.METAL WINDOW Postal Credit s '"r:?'rr. POSTAL CREDIT UNION _ NON-ILLUMINATED (\ PIN MOUNTED METAL LETTERS METAL SERVICE DOOR 3 SOUTH ELEVATION A3.1 SCALE:ve•=r-o. :�ww —-——-— — L Z_Z;_�- ------------- -------- ----- --- --- - ---- -_--_--_--_--_ - SEESIMILARe - -------- -- - - - - - - A3.1 __------- _____- ____ _________________ ____ _-_____ ______ __-_ __ CAST STONE PARAPET -__- - -_-- - ===- - -- _- - -- == _ 1/yfv,! _-- __ -- _ - STONE BELT LINE . - PostaI Credit Union - - BRICK ORNAMENTAL METAL GATE 1Wl PREFIN.ALUM.FRAMED SECURITY TELLER WINDOW 4 WEST ELEVATION W/TELLER DRAW A3.1 SCALE:1/8"=1'-0' Dora Maxwell Social Responsibility Recognition 2006 Award Entry f®r astal Credit Union f�•or tr•tr.ti•tc�d./irrcrrrcicrl snJrrtiurr.� t 2006 Dora Maxwell Social Responsibility Recognition Award Table of Contents Dora Maxwell Social Responsibility Recognition 2006 Award Entry Table of Contents Checklist Page 1 Entry Form Pages 2 — 8 Supporting Document for Community Involvement Committee 2nd Harvest Heartland Pages 9-13 Women's Shelter Donations Pages 14-15 Chain of Hearts Page 16 Cans for Kids Page 17 Pop Tabs for Ronald McDonald House Page 18 Supporting Document for Other Charitable Activities PCU donations and volunteers Page 19 PCU Environmental Learning Center Cleanup Page 20 Checklist for Dora Maxwell 2006 Entry Checklist for Dora Maxwell Social Responsibility Recognition , Award Entries The following checklist will ensure that Dora Maxwell Social Responsibility Recognition Award entries are complete. Please include the completed checklist with your entry form. X Does the entry include one completed entry form listing the credit union's name, address and asset size, FOM, number of members, number of employees, number of employees responsible for implementing the project, a contact person, and a description of one project? X Does the entry form state that it is intended for the Dora Maxwell Award program? X Does the entry form include the most current asset figures for the credit union? X Are all materials either in a three-ring binder or a spiral-bound notebook? X Does the entry describe the measurable goals of the program, including budgets, numbers of people involved, etc.? X Does the entry list the groups the program tried to reach and describe outreach strategies? X Does the entry show how activities were promoted and include sample articles, ads, flyers, brochures, descriptions and photos? X Does the entry include a timetable, budget, and results in the project description? (Be sure and include dollars and numbers.) X Is the entry concise and readable? (Remember, more isn't always better!) Include this checklist in your entry and return to the Network office by Friday, July 21. 2006 Entry Form for Dora Maxwell Social Responsibility Recognition Award 2006 Entry Form for the Dora Maxwell Social Responsibility Recognition Award Contact Person Patricia Kamas Title Business Development Manager E-mail address pkamas(a-)-postalcu.org Credit Union Name Postal Credit Union Street Address 8499 Tamarack Road P.O. Box City Woodbury State Minnesota Zip 55125 Phone Number 651 747-8957 Fax Number 651 747-1857 Asset size: Less than $5 million $5 - $20 million $20 - $50 million $50 - $100 million $100 - $200 million X $200 - $500 million $500 million+ Chapter Credit union's field of membership: Community Chartered (Washington, Ramsey, Dakota, Anoka, Hennepin & Chisago counties), SEG's, contributions to the John Miller Scholarship Fund Number of credit union branches: 3 Number of credit union members: 38,454 Number of credit union employees: 124 Number of credit union employees responsible for implementing the project: 30 Please include significant promotional materials, descriptions and photos of projects/events with your entry form. Submit materials in a three-ring binder or spiral bound notebook. Electronic media is not encouraged Answer the following questions (use additional paper if necessary): 1. If your credit union was involved in multiple projects, please list them here. If not, proceed to the next question. * Community Involvement Committee United Way Meals on Wheels — Food Drives and Donations Cans for Kids Pop Tabs for Ronald McDonald House Chain of Hearts, Children Miracle Network Adopt a Family Casual for a Cause School Involvement Pro Latino Women's Shelter & Habitat for Humanity * PCU Environmental Learning Center Clean Up PCU employees volunteer to assist and supervise the 4th and 5th grade classes from Richardson Elementary who clean up the Environmental Learning Center. * Business Partnership with Woodbury High School Partnership with Woodbury High School to go in and talk to classes about careers in our industry. * Skyview Elementary, Maplewood Middle School, and John Glenn Middle School Home Economic Banking Program PCU sponsored the materials for these classes and sends two representatives from PCU to speak to the classes about banking, financial health and jobs in the industry. *Junior Achievement Program —Woodbury Elementary, Red Rock, and Castle Elementary PCU sends two employees from the Training Department to teach students the basic concepts of business and economics and how education is relevant to the workplace. *OBPA Annual Golf Tournament Hole sponsorship at tournament— proceeds go to Holiday Helping Hands *Woodbury Chamber Golf Tournament Hole sponsorship at tournament— proceeds go to Woodbury High School Sr. Scholarship *John Miller Golf Tournament Sponsorship at tournament— proceeds go to John Miller Scholarship Fund *Skip a Pay Promotion $5 from each person electing to skip a payment was donated to 2nd Harvest Heartland *Susan G. Colman 3 Day Breast Cancer Walk Donations to golf tournaments to raise funds for the Susan G. Colman Foundation and partial sponsorship of an employee that will be participating in the 3-Day walk. *North St. Paul Merchants Initiative Task Force Helping Merchants come together in the community to support each other and build their businesses. 3 2. Select and describe the one project that was the most successful and the most unique —the one that best exemplifies the Dora Maxwell Social Responsibility Recognition Award. (The ensuing questions must be answered based on this one project.) The Community Involvement Committee reaches out to many different facets of the community and touches a wide range of people locally and nationally through many different means. This is accomplished as simply as an employee donating money each month through Casual for a Cause to taking time out of their day to deliver meals for Meals on Wheels. Others have taken time out of their evening to help assemble supplemental nutrition packs for 2nd Harvest Heartland, which are distributed through the state and sometimes nationally. These contributions are made through the following activities which are all chaired by volunteers on the Community Involvement Committee: Community Involvement Committee United Way: PCU and its employees contribute to the local United Way. By taking advantage of this opportunity, we were able to devote attention to our friends and neighbors in the tri- county community. To boost United Way contributions, we held raffles for all staff. All prizes for the raffle were contributed by local vendors, business contacts, and credit union employees. The campaign was promoted through our staff newsletter, e-mail, memos, and word-of-mouth. Monetary contributions by 124 employees were made through a one-time donation or payroll deduction. The amount donated year to date is over $6000. Meals on Wheels — Food Drives and Donations: Employees donate time once a month to deliver Meals on Wheels to local elderly or shut in people. PCU employees and their families donate also their time at 2nd Harvest Food Shelf to put together supplemental nutrition packs to distribute to low income families and seniors. Can for Kids: Donations of aluminum cans are collected and the proceeds are donated to St. Jude's Children's Research Hospital. Employees help on a credit union wide basis by recycling their aluminum cans. Once yearly there is an external can drive where members and non- members alike are encouraged to drop off their aluminum cans at one of the three credit union branches. Several employees donate a portion of their Saturday to collect the cans. This is a Community Involvement Committee activity that was kicked off last fall. PCU collected 235 pounds of Aluminum cans which translated into $139.15. Pop Tabs for Ronald McDonald House: Pop tabs are collected by the credit union and donated to the Ronald McDonald House. As of June 2006, PCU has collected 44,364 tabs which will be complied with the tabs collected in July and then donated to the Ronald McDonald House. Chain of Hearts, Children Miracle Network: Employees and members alike can contribute to the Children's Miracle Network Chain of Hearts Campaign by purchasing a chain link or a heart. Their name is written on the chain or heart and displayed in the branch in which it was purchased. Our campaign this year raised over $600 for the Children's Miracle Network. L4 Adopt a Family: This past December we "adopted" two local families to help brighten up their holidays. Employee donations were matched by our credit union for a total of$700. This was used to purchase items on the families' "wish lists." In addition, some employees also donated new toys and clothes. One family consisted of a mother with two daughters. The other family consisted of a mother, father, and two sons. Several employees volunteered to shop for gifts for both families, wrap and deliver them to the agency that coordinated the program. Casual for a Cause: The credit union continues to incorporate "Casual for a Cause" day. By contributing a minimum of$2.00 towards a specified cause, employees are given the opportunity to wear casual clothing every other Friday. Employees are also encouraged to submit names of charities important to them. Signs and donation boxes are placed in the lobbies of all three offices to encourage members to contribute as well. 2006 Contributions to date total $2694.57 to the following causes: ➢ Minnesota Autism Center ➢ Special Olympics ➢ Gerry's House of Hope ➢ Habitat for Humanity ➢ Camp Odayin ➢ Meals on Wheels Local Centers ➢ 3-day Breast Cancer Walk ➢ Second Harvest Heartland ➢ Tubman Family Alliance Still to come in 2006: ➢ Animal Arc ➢ Second Chance for Life Foundation ➢ Juvenile Diabetes ➢ MN Credit Union Network ➢ Little Red Stocking ➢ Lupus Foundation of Minnesota School Involvement: 4th graders from Skyview Elementary School are given the opportunity to be a "Banker for a Day". The children are given a tour of the credit union and then have the opportunity to shadow a teller or member service representative for a short period of time. Pro Latino: Cinco-de-Mayo celebration at our branch which caters to large population of Spanish speaking members. Refreshments are set out for all members and the branch is decorated with a Mexican flavor. Also, Cinco-de-Mayo buttons are sold at the branch for the local Cinco-de-Mayo celebration and the proceeds given back to community. Women's Shelter & Habitat for Humanity: Employees donated 30 backpacks filled with school supplies to three local homeless or women's shelters. The backpacks were filled with all the school supplies students needed for back to school. There were school supplies remaining after filling the backpacks, which were donated to the schools that served the homeless or women's shelters. 5 3. What were the goals of your project and how did they show social concern for the community? (Include measurable goals such as dollars budgeted, number of people impacted, etc.) The goal is to reach out and cater to the needs of the community and the nation. PCU is always very generous in aiding others. The Community Involvement Committee fulfils this goal by helping local charities with Meals on Wheels and school supply donations as well as state and national level charities by helping assemble supplemental nutrition packs and donating to Casual for Cause. Casual for Cause reaches from the local level of Meals on Wheels to the national level of the Susan G. Colman 3 Day Breast Cancer Walk. The Credit Union aids the nation by making a variety of other donations. In 2005, PCU donated over $4400 to Tsunami Relief and over $8800 to Katrina Relief. The Community Involvement Committee directly impacts countless people in local communities through Meals on Wheels, Donations to Local Women's Shelters, Adopt a Family and donations to local charities. Nationally the Community Involvement Committee impacts thousands through donations. Donations, year to date, total over $10,000 through employees and members alone, the Credit Union matches most of these donations, bringing the total year to date contribution to nearly $20,000. 4. How did the project support the needs of the community? The needs of the community are many, with assistance needed in purchasing school supplies for students, delivering meals, and providing assistance with buying gifts to help those in need. The Community Involvement Committee primarily supports these community needs through the functions of Meals on Wheels, donations to the women's shelters, Adopt a Family, and Casual for a Cause. 5. Define the project's target audience(s), including who got involved and who benefited from the project. Individuals and families who are under privileged or in need benefit from the Community Involvement Committee. Employees directly contribute to the communities needs through monetary donations, donations of school supplies, toys and clothing, or donations of personal time to deliver meals assemble supplemental nutrition packs, deliver school supplies and Christmas Gifts. All people involved in these activities benefit, from the people receiving the donations to the people contributing. The people receiving the donations were extremely grateful in their reception. The people delivering and contributing were touched by the gratefulness of others and gained appreciation for the simple necessities of life which are often taken for granted. 6. What strategies were used to reach the project's goal? Committees are formed and employees recruited to chair and support the sub-committees. E- mails and materials are sent to employees to recruit volunteers or ask for donations to the causes. Paper flyers and information is posted on the video screens in our lobbies to inform and encourage members to contribute to things such as Casual for a Cause. 7. How were the project's promotional materials targeted to the intended audience(s) and how did they communicate the project's goals? E-mails and materials are sent to employees to recruit volunteers or ask for donations to the causes. Paper flyers are posted in the lobby for Casual for a Cause and video commercials are displayed on the lobby video screens to inform the members that they may also contribute. When an activity is accomplished employees are notified through e-mails. Members, employees and the general public are given information about projects through PCU's newsletter Dollars and Sense, the website and newspaper articles. 8. How is this project unique? How does it demonstrate extraordinary effort and devotion of time and organization by the credit union? This project is unique in the sense that it does not focus on only one cause or one facet of the community. We are spreading the contributions to all ages and areas of the community, these many causes touch our lives in one means or another. The people involved in the committee see first hand how we touch their lives, through delivering meals to dropping off backpacks. Employees see the gratefulness in the recipients' eyes; the personal contact touches many people and keeps employees motivated to continue the quest of the committee. The Credit Union is more than gracious in allowing employees to take time off for these functions so that we may give back to the community. 9. Please describe the measurable or defined results the project achieved. The results the project achieved are many; monetarily nearly $20,000 has been contributed to various organizations by PCU, members, employees and board members during the past year. In other ways the results are immeasurable. You cannot put a price on delivering a hot meal to a person or giving a backpack to a school child whose parents cannot afford to buy them school supplies. The smile of a child at Christmas who finds gifts under the tree when their parents struggle to put food on the table is priceless. 10. How does the project demonstrate credit union values of mutual self-help, cooperation, economic empowerment and volunteerism? The credit union is about people helping people. People, employees and members alike contributing to those in need. When there is a need for volunteers, employees graciously step forward. The Credit Union encourages the volunteerism through being very helpful in allowing the time off to participate. Employees want to volunteer, they want to help, especially when they see first hand or hear from another employee how volunteering effects the recipients. Volunteers allow those in need to lead better lives by giving them the time and monetary tools they need to do so. Include this form in your entry and return to the Network office by Friday, July 21. Supporting Documentation for Community Involvement Committee 2nd Harvest Heartland assembling .supplemental nutrition packs Excerpt from PCU's Dollars & Sense ee �I �� $ ��• ill y!p ! A ) PCU employees and volunteers rolled up their sleeves to help Second Harvest Heartland Food Bank pack over 600 boxes to aid in the fight against hunger. Among those taking part were PCU employees, from left, Mark Flores, Ryan Howe and Chas Friederichs, Second Harvest was also presented with a check for$710 raised through a recent skip-a-pay loan promotion. q New Release for 2""" Harvest :Heartland PCU Presents Check for $4,459 t® Second Harvest (Woodbury, MN—March 24, 2006) In an effort to help fight hunger, Postal Credit Union (PCU) raised $4,459 for Second Harvest Heartland through its recent Skip-a-Pay promotion. For each loan payment PCU accountholders skipped, $5 of their processing fee was donated to Second Harvest. PCU presented the check for$4,459 to Second Harvest on March 20`h, giving them enough money to pay for more than 17,000 meals. "'This promotion was well received because it gave our members the opportunity to help those in need while freeing up a little money of their own," said PCU President Russ Plunkett. "'This is just one of many ways PCU members,employees and volunteers help support the communities we serve." Second Harvest Heartland is the region's largest hunger relief organization, serving more than 300 non-profit agencies in 61 counties in Minnesota and Wisconsin. The organization operates a variety of programs designed to combat hunger through specific channels of distribution. Among those served are children, the elderly, the working poor and thousands of additional disadvantaged rnerabers of the communities in its area of service. tb 2nd Harvest Heartland Donation through Skim-a-pay Excerpt from the St. Paid Pioneer Press $T. PAUL PIONKER PRESS WWWAVVMCME5.COM a flA M, `Vr,ft C E 'HAPPENINGS IN, BUSINESS Credit union ftigijfs hunq, . Postal Credit Union raised It,rm for SeronH Harvest Heartland through its recent "skip-a-pay" promotion.The I promotion allowed customers to skin Ey lean payment in exchange fpr n$s prose%iDg fee that then was donated to Second Harvest.The donation was enough to pay for more than 17,000 meals. II 2nd Harvest Heartland Donation through Skip-a-pay Excerpt from Woodbury Bulletin FCU- resel- Its check to Second f lar est, I recent Skip-a-Pay prornown. Wisconsin. The organization �. For each loan payment PCU operates a Vazriery of-LD a t'a�`�•s i ;, accountholders skipped, $5 of designedto combat hunger their processing Lee was clonal- throup specific channels of _ eel to Second harvest. distribution. PCU presented the check for Among those se�ecl a e e}��- $4,459 to Second l'Iarasst on dr-an, eine ¢ldsrby, the vdo*3 ng k March 20, glving there enough poor-and dhousardis of adds- money to pay for rnore than tion disc^dvawzged ff-Aeinbers 17,003 gineals. of the cornmur wi des i,-its wren of 'This prornotion' was even service. I;�1 received because i? ave our Founded in M6, Postal g members the.opportunity to Credit f3nion i3 a sen vice .�.{. /.1-11•!,<{ �Gf—:.� i.� ....�..�:� �.OeNu3 help those in reed while freeing finarncl.0 cooperadve olufvfmg a .2f nap a]cUi money of their ow n,,, complete range of servlces, _ said PCU President Buss including 24/7 loan zpproval, j'. Piunken. "This is just one of mortgages, online bin'b ng, many ways PCU members, checking, lnvesk neat sen;rices employees and volunteers help and M-0,1 e. sv a�a�t�� ±ago support flea communities erre PCU serves aka, Chlsago, ,FW3Tn ism, PP-69 LUCK ISAEd sa-�' serve." Dakota,Hennepin,W- Fshangton, �k7'±MA W*Airdl AL3 8,) fO I ; Second Plarvest Hearda d is and lba�r,sey c©im as. the region's Qaigest hurnger relief For neons.LnIoA m-2ti,Dr-, call organization,serving more than PCU at(651)770-7M;ODO-247- 7n ar; ei<�? ? rte Mip Aght ('PCU)raked U1,459 for Second 800 nonprofil agencies in 61 0657 or visit w-vsvi posWcu.org. hu gr;r�Pn�-t� Cyrdli -1niopL Ury—r3lr-anlanfl throu&, its couotles Ira ?Vllrmrsoa and Wi-44 Von cottlY 4�tip a Payment Well, novo you can! For only$20 you can �y.,' To take advantage of Skip-a-Pay, simply fill skip a PCU loan payment this February, , " ��" out and mail the postage paid form below- "' leaving more cash in your pocket.The it's that easy.Then enjoy the peace of mind best part is,$5 of your$20 will be donated l \ ' #,, ' of knowing you'll have at least one less bill to Second Harvest Heartland -the Upper y ��� to pay in February. Questions?Simply call Midwest's largest hunger relief organization! 651-770-7000 or 000-247-0857. Don't i That means you'll be helping feed the '.' delay-PACO must receive yotir written hungry while enjoying additional financial SEC.0111D I-InttVes-r authorization 10 days before your AbtD flexibility after the holiday season. N.F.Ait.TLFebruary payment is duel S,1 meant t9 skip any PCU lcar>a payment for the rnantfi of February,2006. I understand that I will be charged $20 per skipped loan payment,S5 of which will be donated to Second Harvest Heartland.To process my Skip-a-Pay rookies3; 0 Postal Credit Union must receive my written authorization at least 10 days before my February payment is due. 40 Please defier the following PCU loan payment(s)for the month®f'Febmary,2006(this o!ier excludes Mortgage, Home Equity Line of Credit(HELOC),Visa Platinum HELOC,Norm;Equity Installment, Home Improvement,Auto Equity, and Visa Credit Card loans) Account# _. _ Loan Suffix Account# -_ _---- Loan Suffix _ Account — -__ i W_ Loan Suffix ' T9tal charge, _........__ — JA&I$20 for each skipped payment) Cc oc—k enclosed for total charge �,L7 Ple-ast transfer tot7l,charge from my _Savings _Checking i un Tarsta:;d the trs(na ana conUfliwis Dt in,,,roan agreement will apply except trial there will not be any regular monthly payments required during the delerrat r>'AW set Wlib r awye.Thvireafter,f must make my r egWil,TOnLi!y,or F?Iri^ti;m(c;I Thits.I urrderstan0 that FINANCE CHARGES will continue to accrue during the deicrral pentxl.that defe(Gil tt .r,rr,,ragwar or miriar,q+t:norm !v o@yrnrfits Y411 r csull in my having to pay higher total FINANCE CHARGES,and that my loan repayment schedule will be extended.I undrrslvut • >~Ji PCU rt+uyv?p Ihw rugt3 30 w..-s nate mis dSer if my hnancial-ictus changes after the date of the oiler.I understand that I may only skip one payment per co!cndar year ft-4al Cr tiltt Un:On ridl not prrrr_.ss;my rnrpesi,and I may not slip my February 2006 payment(s),if my check for the administrative fee is returned I understand that my acc,uni cannot be more than to(lays Past clue E0 be e!i ibie for this oiler.This form expires February 28,2006 F, Print name _ _ Daytime phone# �a ra8. Signature �_. Date--- _— r. Mail to- Postal Credit Union 7{ Attention: Member Services 2101 McKnight Road North r'v.crtyl `t�. North St.Paul, MN 55109-9913 NOTE:If you mail ihi;application,please tape(do not staple)the mailer shui on bolt+ends.After sending your application,PCU will only contact you in the event that you do not r qualify for this promotion For Credil..Union use only: Date received _ Accepted by operator _Oualiiies Does not qualify Women's Shelters Donations backpacks and school supplies Excerpt from YCU's Dollars & Sense QiQD��I@�tQ65Bit�' BB��QDIv('•����;Ukg Council steps in PCU's Community lnvolveirwna Council, an employee group firmed in 2003 to target specific needs within our service area, learned that many local families lacked the funds to purchase school supplies for their childre-n. I-) help fill the void, employees Purchased, filled and donated 30 backpacks to local shelters and school supplies to local schools: "it made us feel great to know we were providing children with the supplies they so desperately - needed,"said Patty Kamas, PC'J Business Developmew Manager. "The schools were t d by our b ,> i!li9Ch� �'n��ioSity. j t !. New Release for school supply donations PCU Donates School Supply-Faller Backpacks to Focal Shelters (Woodbury, MN—September 22, 2005) Each fall students return to school armed with a wealth of school supplies which are essential for a successful school year. Unfortunately, not all families have the means to provide these items. To help fill that void employees of Postal Credii Union (PCU)recently purchased, filled and donated 30 backpacks to local shelters and school supplies to local schools in the greater St. Paul metropolitan area. Each backpack contained a variety of school supplies, such as pencils, notebooks, a ruler, colored markers,pocket folders, and more. Employees were asked to pick up extras while shopping for their own students prior to the start of the school year. "It's important for students to have the supplies they need to be successful," said PCU President Russ Plunkett. "So often teachers will buy extra supplies to have in the classroom for those in need, and pay for them out of their own pocket. Our employees enthusiastically embraced this oppmunity to help fill that gap." 1� • �����'Gt'��6d��5'� ��'��`�@9'��'��ffi' E'��9®9�ffi'�9�� ®�U'@9�t7®QCs'CSC`�CJtG�G�+ ��'Gy(�O�Q��s"f%C�'p�CJ�C3��'f�G�' ® fl� Support the 2000 qy Chain of Hearts Campaign ! aD aP Q� Q� a� Q� pv QP QP ® ®P H� R�� V `? eq? Q� Y W A�n ryP qW ryV p� •➢ W Donate $1 .00 n� Q� V Q� ry� W q�q V per flnk or $r...00 per hear' to benefit oO lw IV Children's peri Q y Heafthcarec, R? IV lw w lw Q'v IV lw Thanks for support' IV ® V lw w vIVcr,vv(Pvv( vcvU Svc QvvvQC;Qvv vv vvQvvvvvvv ,� Cans for lids can drive Excerpt from PCU s Dollars & Sense {�4 I l Thank you to all of our members who dropped off their aluminum beverage cans on October 29 to help raise money for St,Jude Children's Research Hospital. PCU received a whopping 253 pounds of cans,which were recycled at$0,55 per pound for a total of$139.15. A special thank you to Shirley and William Young who generously delivered a trailer full of cans, PCU plans to make Cans for Kids an annual event, so be sure to save your cans for this greet cause! �I Pop Tabs for Ronald McDonald House E-mail update for employees To, EvrrHbcdy Subjpylo 6Res,,Wts from the 9 9th month of the pop tab contestO! The Totals For June Are In!!!!! North- 399 33 Feet & 3 Inches Taveled Total Tabs- 20,181 Total Traveled- 1,681 Feet & 9 Inches South Town- 28 2 Feet & 4 Inches Traveled Total Tabs- 849 Total Traveled- 70 Feet & 9 Inches Woodbury- 1,986 165 Feet & 6 Inches Traveled Total Tabs- 23,334 Total Traveled- 1,944 Feet & 6 Inches "BONUS "ICTE4115", There are no bonus items this month. �,VOH we only have one month Deft of the contest and everyone has done exceptionally well!!! 1 eeP up the Good WorW V"uve Facts *Bill Cosby was born on July 12th *Iowa has 4 Cities with the word Liberty in the name: Libertyville, New Liberty, North Liberty & Wesi Liberty "The first celebration of the 4th of July was done on July 8th 1776 after signing the Declaration of Independence. This was not declared a legal holiday until 1941. *The Bible is the world's most selling book.......However it is also the world's most shoplifted book. "Your Tongue is the only muscle in your body that is attached at only one end. *If we could line up all the pop tabs and put them straight down in the ocean they would go down over 616 F=athoms. To get an idea of how long that is, the deepest a boat-based sea fisherman can go off the coasl- of California is 60 Fathoms. Thanks Again! hyu,, Howe Community Involvement Committee Supporting Documentation for Other Charitable Activities PCU donations and volunteers Excerpt from PCU's Dollars & Sense PCU Puts x'111 S hVyr Members, employees and volunteers help variety of causes in community Caiis for Kids. Mainma. Lucci's .`'spaghetti for a C<nuse- Packing 600 boxes of food at Second Harvest Heartland. When it (%oun less sway% to give comes to helping out in the The Community Involvement community, PCU members, Council has also helped raise Money employees and volunteers are for a variety of causes, including St, happy to lend a hand. Jude Children's Research Hospital �md Children's Miracle Network. A Passion for Giving In addition, they have coordinated 2005 was a blockbuster year for learning activities with local giving back to the communities elementary schools. And since PCU serves. With the help of 2003, they have participated in the members, employees and volunteer Meals on Wheels program. Each l yard of Directors, yoiir ciedit week council volunteers drive to MItOn raised thoosands of dollar Gladstone Center in Maplewood fo.-loc_il ch>)rities and donated to pick up meals and supplies and viiany hours of time. The passion then deliver them to area residents icPiaye�i for helping others is with health problems. These evident in the multitude of ways volunteers agree that you can't beat YOU have all reached out to those the good feeling you have after in need. delivering meals. Katrina relief tops $8,800 Other efforts by PCU members, After witnessing the devastating employees and hoard members effects of Hurricane Katrina, your include raising more than $4,400 for credit union used its monthly Tsl±narni Relief in January, 2005. Casual for a Cause campaign in PCU employees also give geneiousiy September to raise funds for to United Way each year. The organizations providing relief. contributions of all involved ate As a result, a total of$3,861 was endless. Howe sums it up best, "It donated to the American Red feels so good to help people in the Coss and the Salvation Army community and know you're nicking op hurricane victims. PCU's a difference in their I <-es. 1'ni glad Board of Directors contributed I') be Part of a company that truly 111 :rlditiunol $5,400 to the cores about the welfare of others." Salvation Array to slid in its relief efforts. I Cl PCU Environmental Learning Center Clean Up Excerpt from PCU website Join PCU ^� PC ACCLE$S I ATM ( Shared Servic~ f : n e-m.ti a-education law,-M n1�- m.ml� [ending center 1� online services r, Hosie> News&Education>PCU in the Community July 20,200 ` PCU in the Community PCU is involved in several community events,and donates time and money to a variety of causes. In 2005, PCU members, employees and volunteer Board of Directors raised thousands of dollars for local charities and donated many hours of time. Below are some of our recent contributions: Pond Cleanup a Success! PCU's Environmental Learning Center(ELC)cleanup was a great success.The Highland Park Senior High Fresh Force Group spent several hours clearing trash from the shoreline at the west end of the pond on Earih Day, Saturday,April 22.The following Thursday,4th and 51h grade students from Richardson Elementary focused on the rest of the ELC.Altogether,the groups picked up nearly 200 bags of litter,as well as some larger items, including old bicycles and a shopping cart. Several PCU employees also volunteered to cleankop ' the pond area and supervise the students. PCU provided refreshments for all volunteers and donated four `? x savings bonds to the Richardson Elementary students.A big thank you to everyone who participated in the cleanup( , r: tr; Richardson Elementary School students helped pick up litter at PCU's Environmental Learning Center in North St. Paul on April 27, 2006 1?4 Postal 'redit Union Fnr trlr.�le<I,,/iium<iul��,lr��h�us Serving our members Since 1926 Now serving Anoka,Chisago,Dakota, Hennepin,Ramsey and Washington Counties Credit Union Philosophy Cooperative w Member-Owned & Operated ej People Helping People Vo I u nta ry Board of Directors 1 Who are we? Postal Credit Union was founded in 1926; we are celebrating eighty years of service on August 26, 2006. We are a full service financial institution. We have 38,492 members, assets of $412,000,000, i 3 locations and expanding. We have 126 employees and plan toi' �. hire 7 employees for our new location. Services Checking & Savings M `r Home Equity & Vehicle Loans Traditional IRAs / Roth IRAs Investment Services iu Full Service Mortgage f' Department t Mortgage Closing services Business Services 2 Why Hugo? We currently have 2300 members living in Hugo and White Bear Lake (zip codes 55038 and 55110) They currently have 20 million in deposits and 9 million in loans We have over 800 members within 5 miles of this new location. Why Hugo? With the expansion in Hugo we will be able to provide excellent financial services to others within the community. In addition we will have a community room available " { for meetings of up to 25 people. � .Y 3 PCU Community Involvement P"N ® PCU gives back to the community in many ways, through school and community sponsorship, donations and through volunteers. Our employees also commit hours of their time and money to such causes as Meals on Wheels, the United Way, the Children's Miracle Network, and Second Harvest Heartland to name a 14 - few. Local Business Association and Chamber Involvement North St. Paul Business Association Woodbury Chamber of Commerce Oakdale Business and Professional Association North St. Paul Merchants Initiative Task Force Northern Dakota County Chamber Washington County Workforce Investment Board 4 Local Community Involvement North St. Paul ® Home and Garden Show ® Snow Frolics r ■ Crazy Days 1 ® Art on the Street - ■ Business Association Golf Tournament * Fall Round Up Parade Maplewood Middle Schools �� V � Home Economic Banking Program y * PCU Environmental Learning Center Clean Up Local Community Involvement West St. Paul Home and Garden Show Cinco-de-Mayo Celebration Northern Dakota County Chamber r South St. Paul Kaposia4z Days , . uj West St. Paul Parade 5 Local Community Involvement Woodbury * Woodbury Chamber Golf Tournament ■ Oakdale Business Professional 4. ■ Association Golf Tournament ■ Woodbury Days - e Woodbury Days Parade ■ Woodbury Country Mile • ■ Skyview Middle School Home Economic Banking Program ■ Sky-view Elementary School (career day) We fookforwardto being a G in the Yfugo Community 6 01 e vc1G C-, le �, i- e GEOCODE SITE-AREA Area_Impery Percent Cov_Quantity Inspec Date_Inspe 2003121240008 6999.66905738000 4633.51364329016 66.20% 6999.66905738000 2003121240009 999.96539085000 999.96540169751 100.00% 999.96539085000 2003121240015 11067.16717220000 7394.12534539272 66.81% 11067.16717220000 2003121240016 14197.78960880000 1744.10743979157 12.28% 0.00000000000 2003121240017 24059.82211270000 2110.98059777109 8.77% 0.00000000000 No 2003121240022 3077.12403482000 0.03022740355 0.00% 0.00000000000 2003121240023 8355.43545357000 8355.43552433769 100.00% 8355.43545357000 Yes 4/11/2006 2003121240038 5908.44756042000 0.00000000000 0.00% 0.00000000000 2003121240041 11346.11907130000 4153.98338270540 36.61% 11346.11907130000 2003121240043 9928.17778770000 6443.33204581581 64.90% 9928.17778770000 2003121240044 1785.98647902000 136.91404678958 7.67% 0.00000000000 2003121240046 17467.75278530000 10914.55983978740 62.48% 17467.75278530000 2003121240048 5834.24202230000 4170.66980704473 71.49% 5834.24202230000 2003121240049 7619.58313986000 5045.03999064145 66.21% 7619.58313986000 2003121240053 4061.19528987000 2288.94835712783 56.36% 4061.19528987000 2003121240060 9288.91314534000 2789.11078232160 30.03% 9288.91314534000 2003121240061 5999.96481376000 0.00000000000 0.00% 0.00000000000 2003121240069 21951.33736020000 0.00000000000 0.00% 0.00000000000 2003121310004 6740.86001202000 0.00000000000 0.00% 0.00000000000 2003121310008 3273.24742121000 3238.06327950465 98.93% 3273.24742121000 2003121310009 2955.42201758000 1499.80133295698 50.75% 2955.42201758000 2003121320005 20949.96245620000 1939.19605448340 9.26% 0.00000000000 2003121320009 21845.92689790000 1793.13153053652 8.21% 0.00000000000 2003121320016 4856.32021683000 4856.32001897164 100.00% 4856.32021683000 2003121320017 3618.97605316000 3618.97609227395 100.00% 3618.97605316000 2003121320019 4891.96288570000 4891.96298409754 100.00% 4891.96288570000 2003121320020 951976.65805299900 0.00000000000 0.00% 0.00000000000 2003121320021 20179.50461800000 20179.50463608470 100.00% 20179.50461800000 2003121320022 43773.38673830000 43773.38671169870 100.00% 43773.38673830000 2003121320023 118969.27737400000 118969.27730379700 100.00% 118969.27737400000 2003121320024 118098.76334000000 21592.00000000000 18.28% 118098.76334000000 2003121330005 10522.85943720000 29.50638975788 0.28% 0.00000000000 2003121330006 5775.09097008000 1454.96594835334 25.19% 5775.09097008000 2003121330011 42026.03041600000 15692.62830306320 37.34% 42026.03041600000 2003121340076 15746.49817730000 0.00000000000 0.00% 0.00000000000 2903121210016 57924.00037110000 0.00000000000 0.00% 0.00000000000 2903121210099 6270.38717274000 0.00000000000 0.00% 0.00000000000 2903121220005 48975.41977620000 0.00000000000 0.00% 0.00000000000 2903121220006 73610.43129110000 0.00000000000 0.00% 0.00000000000 2003121320003 16199.39946690000 5081.85596452104 31.37% 16199.39946690000 No 2003121320001 31426.25236660000 10661.35311294370 33.92% 31426.25236660000 No 2003121320006 43692.44799180000 6938.41261233497 15.88% 43692.44799180000 Yes 4/11/2006 2003121320004 22741.71269510000 5358.64211628029 23.56% 22741.71269510000 Yes 4/11/2006 2003121320007 21845.95107770000 3007.46666236669 13.77% 0.00000000000 2003121320008 21845.87405360000 5481.33457543592 25.09% 21845.87405360000 No 2003121330002 35188.55532520000 21716.83307600450 61.72% 35188.55532520000 Yes 3/16/2006 2003121320010 21845.87426980000 5477.77047463902 25.07% 21845.87426980000 2003121320012 21798.90309100000 4089.85888638276 18.76% 21798.90309100000 No 2003121320014 20945.05020210000 2639.89580778404 12.60% 20945.05020210000 No 2003121320013 20966.21660520000 4412.42139704547 21.05% 20966.21660520000 No 2003121320015 21285.91844210000 2994.25024646959 14.07% 0.00000000000 No 2003121320018 21907.27553660000 3242.70236281906 14.80% 0.00000000000 No 2003121320011 44140.64878680000 44140.64861449770 100.00% 44140.64878680000 2003121230025 89996.25711430000 51353.20283505010 57.06% 89996.25711430000 2003121230017 19999.13055710000 4815.95571053965 24.08% 19999.13055710000 2003121240064 1800.07278148000 842.60961697033 46.81% 1800.07278148000 2003121240062 8999.36160692000 3539.19303067083 39.33% 8999.36160692000 Yes 2003121240066 7499.70817174000 7300.18224649912 97.34% 7499.70817174000 Yes 6/15/2006 2003121340077 26911.95861540000 3959.94782292927 14.71% 0.00000000000 2003121240063 17939.89753100000 5230.30238701911 29.15% 17939.89753100000 Yes 2003121240065 23156.19258690000 20276.22139115150 87.56% 23156.19258690000 Yes 6/15/2006 2003121240012 7499.63235067000 2895.88939636027 38.61% 7499.63235067000 2003121340078 12844.17695180000 2381.10284826838 18.54% 12844.17695180000 No 2003121240011 14999.28833910000 2762.91358465760 18.42% 14999.28833910000 No 2003121340079 11843.04332790000 5079.21097483018 42.89% 11843.04332790000 No 2003121340020 9819.65372794000 2861.10575845507 29.14% 9819.65372794000 2003121210029 33263.99433920000 6833.47067701812 20.54% 33263.99433920000 Yes 4/18/2016 2003121240018 8353.08820428000 8353.08834035332 100.00% 8353.08820428000 Yes 4/18/2006 2003121240070 21988.88326320000 21988.88314433640 100.00% 21988.88326320000 Yes 4/11/2006 2003121240025 20899.95350910000 13366.36773169920 63.95% 20899.95350910000 No 2003121240027 18600.99369480000 6267.66276193003 33.70% 18600.99369480000 Yes 2003121210073 19882.77686450000 4464.24634446142 22.45% 19882.77686450000 2003121210017 36352.00000000000 26559.03616483500 73.06% 36352.00000000000 Yes 5/25/2006 2003121240056 44608.16680140000 5286.15428177027 11.85% 0.00000000000 Yes 6/8/2006 2003121240026 16751.11485960000 4686.53040231502 27.98% 16751.11485960000 2003121240057 20664.05887580000 4245.18328274576 20.54% 20664.05887580000 Yes 2003121240028 19929.93570500000 4678.08733133266 23.47% 19929.93570500000 2003121240058 19847.27595480000 3126.92795588699 15.75% 19847.27595480000 Yes 4/18/2006 2003121240030 16313.78982970000 3941.72182727432 24.16% 16313.78982970000 No 2003121240059 21376.44835160000 4561.43624090193 21.34% 21376.44835160000 Yes 4/20/2006 2903121230001 15918.73041470000 1576.78712010201 9.91% 0.00000000000 2903121220004 60296.61674650000 9143.92301123741 15.16% 60296.61674650000 No 2903121210009 44098.84197619990 3630.38277088276 8.23% 0.00000000000 Yes 4/11/2006 2903121210008 47959.13555440000 4135.51511258629 8.62% 0.00000000000 2903121220008 18454.60735990000 5864.46444280807 31.78% 18454.60735990000 2903121220001 129663.27082400000 54775.24715375650 42.24% 129663.27082400000 Yes 5/18/2006 2903121220007 82800.32289900000 52139.15318846500 62.97% 82800.32289900000 No 2003121330010 44004.44863200000 14223.07363716440 32.32% 44004.44863200000 2003121330009 43816.28268260000 43816.28266257720 100.00% 43816.28268260000 Yes 7/25/2006 2003121330004 87091.04405580000 26800.50705905470 30.77% 87091.04405580000 2003121340028 14125.23919970000 14125.23913640940 100.00% 14125.23919970000 Yes 2003121340026 40991.97806090000 2883.37581219279 7.03% 0.00000000000 2003121340024 10645.45098000000 676.65455487523 6.36% 0.00000000000 Yes 4/18/2006 2003121340025 9980.07180148000 2772.66205528813 27.78% 9980.07180148000 Yes 4/11/2006 2003121340023 23834.90185450000 5409.94044456946 22.70% 23834.90185450000 2003121310024 117612.00000000000 61559.26546531380 52.34% 117612.00000000000 Yes 4/13/2006 2003121310012 61082.23629620000 0.00000000000 0.00% 0.00000000000 2003121310002 29052.88598050000 6038.56815646427 20.78% 29052.88598050000 2003121310007 4464.48053970000 1107.31197583212 24.80% 4464.48053970000 2003121240052 1728.84113763000 1695.95060537303 98.10% 1728.84113763000 2003121240051 49234.49149910000 40009.66548027610 81.26% 49234.49149910000 2003121240050 8050.01259116000 7908.72170168390 98.24% 8050.01259116000 2003121240047 22106.04876870000 17628.12701974880 79.74% 22106.04876870000 Yes 6/1/2006 2003121240045 11924.38901810000 4247.29163363263 35.62% 11924.38901810000 Yes 6/1/2006 2003121240042 10721.12198270000 10151.03063091040 94.68% 10721.12198270000 2003121240021 14425.44105340000 3499.61188607507 24.26% 14425.44105340000 Yes 6/15/2016 2003121240040 25555.12864120000 2830.19292279520 11.07% 0.00000000000 Yes 3/9/2006 2003121240035 7367.77601336000 1380.66202377837 18.74% 7367.77601336000 2003121240006 40341.93603090000 20293.15443861500 50.30% 40341.93603090000 2003121240039 40168.93995560000 6035.75048863669 15.03% 40168.93995560000 2003121240034 9131.65813876000 2270.07707847362 24.86% 9131.65813876000 2003121240013 8999.58217883000 5550.73857668634 61.68% 8999.58217883000 2003121240033 10381.91242100000 3144.61173815169 30.29% 10381.91242100000 2003121240014 22922.71928400000 1583.53461498117 6.91% 0.00000000000 No 2003121240032 10702.51100590000 2068.24789243521 19.32% 10702.51100590000 Yes 3/9/2006 2003121240054 17976.76942170000 10357.32320992950 57.62% 17976.76942170000 No 2003121240031 12005.54237250000 5534.15147972869 46.10% 12005.54237250000 2003121240024 13242.17092580000 5252.73087991936 39.67% 13242.17092580000 2003121240055 12046.84315970000 5051.86747397554 41.94% 12046.84315970000 No 2003121240010 16499.25991800000 3171.79130031399 19.22% 16499.25991800000 Yes 6/2/2006 2003121240068 16554.90739660000 2609.94997092534 15.77% 16554.90739660000 Yes 5/2/2006 2003121240007 6999.69944087000 2258.59651310995 32.27% 6999.69944087000 2003121210015 27764.82823960000 23217.83841556110 83.62% 27764.82823960000 2003121210016 36162.00000000000 36162.43540362830 100.00% 36162.00000000000 Yes 2003121210013 16323.00000000000 16322.84255114600 100.00% 16323.00000000000 Yes 6/22/2006 4046130.68825993000 Total Coverage% = 58.05% 2348853.72096465000 if Lavalle Parcel is not occupied Total Coverage%not including Lavalle Parcel= 75.91% Total Caverage%including Lavalle Parcel = 81.50% if it is occupied z 146TH _ 1 r, a � � , ( CEJ L.�• ��# � � • �r t , r g�yl,111 Red D • not r Focus On New Laws Eminent domain Laura Harris The power of eminent domain has These terms are defined as follows: ings and non-contaminated parcels been under scrutiny since the U.S. Blighted area. Section 2,subd.6 unless there is"no feasible alternative" Supreme Court rendered its deci- requires that the area be in urban in order to remediate blight or con- sion in Kelo v.City of New London last use and that 50 percent of the tamination in the area and all possible summer.While this decision did not buildings in the area are structur- steps are taken to minimize the taking expand local government eminent ally substandard.Section 2,subd. of non-structurally substandard build- domain powers,it raised awareness and 7 defines"structurally substan- ings or non-contaminated parcels. sparked a vigorous public debate about dard"as a building:1)that has been Finally,section 8 of the new law the use of eminent dom ain,particu- inspected and cited for enforceable provides that takings to mitigate a larly for economic development and housing,maintenance,or build- blighted area,remediate an environ- redevelopment purposes.In its deci- ing code violations;2)in which the mentally contaminated area,reduce sion,the court invited states to scru- building code violations involve abandoned property,or remove a pub- tinize their eminent domain laws,and specific structural aspects of the lic nuisance require a preponderance state legislatures across the country building;3)in which cited viola- of evidence showing if challenged in responded with legislation to restrict tions have not been remedied after court.A court order approving the the use of this tool. two notices to cure noncompliance; public purpose,necessity,and author- In the 2006 session,the Minne- and 4)where the cost to cure the ity for a taking is final unless an appeal sota Legislature enacted a new law violations is more than 50 percent is brought within 60 days. that severely restricts the use of emi- of the assessor's taxable market value nent domain for economic develop- for the building. New compensation requirements ment and redevelopment purposes Environmentally contaminated area. Minnesota's new eminent domain and provides greater compensation to Section 2,subd.8 defines"environ- law contains several provisions that property owners in all condemna tion mentally contaminated area"as an will increase the cost of all eminent proceedings.The bill was signed into area where more than 50 percent of domain proceedings,including those law(MN Session Laws 2006,Chapter the parcels contain contamination for traditional public uses,such as 214)on May 19,2006.The key provi- and the estimated costs of clean-up roads and parks. sions of the new law are summarized are more than the assessor's esti- These new provisions include the below mated market value of the parcel. following: • Abandoned property. Section 2, • Payment of attorney fees. Section 4 Limits on eminent domain authority subd.5 defines"abandoned prop- provides that the court may award Under this new law,the purposes for erty"as property that has been reasonable attorney fees and costs if which eminent domain may be used unoccupied or unused for at least the final award is between 20 percent are narrowly defined.The public one year;that has not been main- and 40 percent greater than the benefits of economic development, tained;and for which taxes have not last written offer made by the con- including an increase in tax base,tax been paid for at least the previous demning authority before filing a revenues,employment or general eco- two years. condemnation petition.If the award nomic health are not by themselves • Public nuisance. Section 2,subd.9 is more than 40 percent greater considered a public use or public pur- refers to Minnesota Statutes 609.74 than the last written offer,then the pose.However,in limited circum- as the definition of"public nui- court must award a property owner stances the use of emi nent domain to sance"for eminent domain pur- his or her attorney fees.This sec- mitigate a blighted area,remediate an poses. tion prohibits an award of attorney environmentally contaminated area, The new law also limits the ability fees if the final judgment or award reduce abandoned property,or remove of local governments to assemble prop- is less than$25,000.It also specifies a public nuisance constitutes a public erty for redevelopment purposes.In that,for the purposes of determin- purpose. particular,section 3 prohibits the taking of non-structurally substandard build- Continued on page 8 August 9,2006 LMC Cities Bulletin Page 5 r Continued from page 5 structure,development or activity. project and address how the acquisi- • Compensation for loss of driveway tion serves a public use and why the access. Section 11,subd.4 requires property is needed. ing the entitlement to a ttorney fees, compensation if a governmental • Right of first refusal. Section 15 the final award does not include entity permanently eliminates 51 specifies that if a condemning compensation for loss of going con- percent or more of the driveway authority determines that property cern unless it was included in the access to a business that results in has not been used a nd is no longer last written offer made by the con- a loss of revenues of 51 percent or needed for a public use,the author- demning authority before filing the more.Installation of a median does ity must offer to sell the property petition. not constitute elimi nation of drive- back to the person from whom it • Compensation for loss ofgoing con- way access. was acquired at the original price cern.Section 11,subd.2 requires or the current fair market value, compensation for loss of going New procedural requirements whichever is lower. concern if a business is destroyed The new law also contains several • Relocation assistance determination by a taking unless the condemn- changes to the eminent dom ain by ALJ.Section 19 requires reloca- ing authority proves by a prepon- process,including the following: tion assistance to be determined by derance of evidence that the loss • Appraisal and negotiation. Section an administrative law judge under a is not due to the taking,the loss 5 modifies the appraisal and nego- contested case proceeding if the dis- could have been avoided with rea- tiation requirements in Minn.Stat. placed person does not accept the sonable measures,or that going 117.036 and applies these require- condemning authority's offer. concern compensation would ments to all acquisitions.It requires Public service corporations are duplicate compensation otherwise the exchange of appraisals and exempted from many of the new being awarded.It defines"owner" increases the appraisal reimburse- provisions,including the new com- to include lessees wh o operate a ment cap to$5,000 for non-resi- pensation requirements,increased business on real property that is dential property.It also provides that appraisal reimbursement caps,new the subject of an eminent domain an appraisal must not be used or public notice and hearing require- proceeding and requires an owner considered in a condemnation com- ments,and the use of administrative to give the condemning author- missioners'hearing unless a copy of law judges for arbitrating relocation ity notice of intent to seek com- the appraiser's written report was benefit disputes. pensation for loss of goi ng concern provided to the opposing party at within 60 days of the first court least five days before the hearing, Effective date and exemptions hearing. and that documentation related to for existing projects • Minimum compensation. Section a loss of going concern claim must The law is generally effective May 20, 12 provides that when an owner is not be used or conside red in a con- 2006,and applies to condemnation required to relocate,the amount of demnation commissioners'hearing proceedings and eminent domain damages payable must be sufficient unless the documentation is pro- actions commenced on or after that to purchase a"comparable property" vided to the opposing party at least date.For purposes of the law,an in the community,and not less than 14 days before the hearing. action is deemed commenced when the condemning authority's quick Public notice and hearing. Sec- service of the notice of the petition is take deposit."Owner"is defined as tion 6 establishes new public hear- made on the property owner. the person or entity that holds fee ing requirements for takings to The law identifies exceptions for title to the property. mitigate a blighted area,remediate certain actions anticipated as part of • Re-establishment reimbursement. an environmentally contaminated a tax increment financing(TIF) plan, Section 18 requires an acquiring area,reduce abandoned property,or abatement project or a special law. authority to reimburse up to remove a public nuisance.The law Actions commenced between Feb. $50,000 in re-establishment specifies certain notice and hearing 1,2006,and Feb.1,2008,that satisfy expenses to displaced businesses. requirements and requires approval one of these conditi ons are grandfa- • Compensation for removal of a non- by the local elected governing body thered in and are not subject to any of conforming use. Section 10 requires a at a subsequent meeti ng that is at the provisions of the new law.Actions local government to compensate the least 30 days after the public hear- commenced after Feb.1,2008,are not owner of a nonconforming use if the ing.It also requires the resolution subject to the new public use require- local government requires its removal authorizing eminent domain to ments,but are subject to the com- as a condition of granting a permit, identify the public costs and b en- pensation requirements and other license,or other approval for a use, efits known or expected from the procedural provisions of the new law. Page 8 LMC Cities Bulletin August 9, 2006 The law also provides an exception that attorney fees will be awarded prove that there is"no feasible alter- for actions to acquire property for high- in many circumstances.In addition, native"to remediate blight or Con- way projects that,by the day following greater relocation benefits,higher tamination in an area in order to final enactment,have been selected to reimbursement of property owners' take non-blighted or uncontami- receive federal funding and in which appraisal fees,and compensation for nated property.These changes to the service of the notice of the petition is loss of going concern will increase law will likely encourage holdouts. made on or before Jan.15,2007. costs substanti ally. Finally,the new public notice and • The process will take longer. In hearing requirements will also add Practical implications addition to appraisers,local gov- time and expense when a local gov- These changes to Minnesota's eminent ernments will now need to tap ernment seeks to acquire property domain law will significantly impact the expertise of real estate brokers, for redevelopment purposes. the ability of local governments to accountants and business valuation respond to community needs.The law experts to help them deter mine the Share your story goes well beyond addressing the con- appropriate level of compensation It is important for local officials to cerns raised by the Kelo decision and due to a property owner.Local gov- talk with their legislators about the includes several provisions that will ernments will also need to spend impacts of this new law on local affect all condemnation actions. more time and effort documenting projects.Cities should also notify the Local officials should be aware of the public use and necessity for a League about problems they encoun- the following impacts of this new law: taking. ter with the process and the cost of • All condemnation actions will cost • Redevelopment will be more diffi- complying with these new require- more. The new law will add mil- cult and costly. Tight definitions of ments. lions of taxpayer dollars to the costs "blight"and"environmental con- Please contact Laura Harris,LMC, of public projects,including acquisi- tamination"and the limited abil- at(651)281-1260 or Iharris@lmnc. tions for traditional public uses such ity to assemble parcels will obstruct org;or Tom Grundhoefer,LMC,at as roads and parks.The prospect of local redevelopment efforts.Local (651)281-1266 or tgrundhoefer@ attorney fees will necessitate higher governments will need to k eep hnnc.org with any questions about offers,and while property owners written records of code violations this new law may settle in some ca ses,it's likely in order to document"blight"and Opportunity for Participation Public service leadership call for case studies The Innovation Groups(IG)is accepting applications tion partnerships that provided creative,adaptive,and from local governments that are interested in presenting innovative solutions to current and future community during the 13 th Annual 2007 Transforming Local Gov- issues. ernment(TLG)conference to be held June 6-8,2007, • Environmental leadership. That used technology or in Bellevue,Wash. innovation in order to protect natural resources or Submit a successful program,project,or initiative for create a more sustainable community and which one of the following categories: required a committed leadership body. • Elected leadership.Who demonstrated innovation, • Economic leadership. That employed newer technolo- change,strong policy and managerial courage during gies(i.e.broadband) and/or marketing strategies,which unusually challenging times,which actions resulted in attracted and retained businesses and residents. new opportunities for the community,staff consensus, • Organizational transformation.That led to a powerful and citizen trust. change within an organization's culture,management • Citizen engagement.That generated the political will philosophy/principles,work environment,and/or for public work resulting in a committed and engaged service delivery. citizenry rather than a persuaded populace. The deadline to apply is Aug.18.For more information • Community partnerships. With unique types of and to access the application,visit the TLG Conference web public/private,nonprofit and/or educational institu- site at:www.dgconference.org/appfication.htm.Ir August 9, 2006 LMC Cities Bulletin Page 9 PURCHASE AGREEMENT THIS PURCHASE AGREEMENT ("Agreement") is made as of this day of =, 2006, between LOIS MAHLBERG AND PAUL SCHOELLER, as Personal Representatives of the Estate of Jean C. Schoeller (collectively, "Seller"), and THE CITY OF HUGO, a Minnesota municipal corporation("Buyer"). In consideration of this Agreement, Seller and Buyer agree as follows: 1. Sale of Property. Seller agrees to sell to Buyer, and Buyer agrees to buy from Seller, the following property(collectively, "Property"): 1.1 Real Property. The real property located in Washington County, Minnesota described on the attached Exhibit A ("Land"), together with (1) all buildings and improvements constructed or located on the Land (collectively, the "Buildings") and (2) all easements and rights benefiting or appurtenant to the Land (collectively the"Real Property"). 2. Purchase Price and Manner of Payment. The total purchase price ("Purchase Price")to be paid for the Property shall be$135,000.00. The Purchase Price shall be payable as follows: 2.1 $ 5,000.00 as earnest money ("Earnest Money"), which Earnest Money shall be held in trust by Eckberg Lammers, Briggs, Wolff& Vierling, P.L.L.P. ("Buyer's Agent"). 2.2 $ 130,000 in cash or by wire transfer of immediately available funds on the Closing Date. 3. Contingencies. The obligations of Buyer under this Agreement are contingent upon each of the following: 3.1 Approval by the Hugo City Council. All representations made by Buyer contained in this Agreement are subject to approval and/or modification by the Hugo City Council. The Hugo City Council will consider approval of the agreement on July 5, 2006. 3.2 Representations and Warranties. The representations and warranties of Seller contained in this Agreement must be true now and on the Closing Date (as hereinafter defined) as if made on the Closing Date (as hereinafter defined) and Seller shall have delivered to Buyer on the Closing Date a certificate dated the Closing Date, signed by an authorized representative of Seller, certifying that such representations and warranties are true as of the Closing Date. 3.3 Title. Title shall have been found acceptable, or been made acceptable, in accordance with the requirements and terms of Section 6 below. A-1 3.4 Access and Inspection. Seller shall have allowed Buyer, and Buyer's agents, access to the Real Property without charge and at all reasonable times for the purpose of Buyer's investigation and testing the same. Buyer shall pay all costs and expenses of such investigation and testing, shall restore the Real Property, and shall hold Seller and the Real Property harmless from all costs and liabilities relating to Buyer's activities. Buyer shall have been satisfied with the results of all such tests and investigations performed by it or on its behalf on or before the Closing Date(as hereinafter defined). This Agreement shall automatically terminate on the Closing Date (as hereinafter defined), unless Buyer has given Seller notice on or before the Closing Date (as hereinafter defined) that the contingencies described in this Section required to be satisfied by the Closing Date (as hereinafter defined) are either satisfied or waived by Buyer. If this Agreement terminates pursuant to this Section, then the Earnest Money shall be returned promptly to Buyer, and Buyer will execute and deliver to Seller a cancellation of purchase agreement, and Seller and Buyer shall have no further liability or obligations with respect to this Agreement or the Property. If Buyer gives Seller notice on or before the Closing Date (as hereinafter defined) that the contingencies described in this Section required to be satisfied by the Closing Date (as hereinafter defined) are either satisfied or waived by Buyer, then the parties will proceed to close the transaction contemplated hereby and, except as specifically set forth herein, the Earnest Money will be non-refundable to Buyer but applicable to the Purchase Price. 4. Closing. The closing of the purchase and sale contemplated by this Agreement (the "Closing") shall occur on August 1, 2006 (the "Closing Date"), but Buyer may close on any business day prior to the Closing Date by giving Seller at least five days' notice of such earlier date for the Closing. The Closing shall take place at the office of Attorney's Title of Stillwater ("Title Company") in Stillwater, Minnesota. Seller agrees to deliver possession of the Property to Buyer on the Closing Date, except as provided in Section 13 of this Agreement. Any party hereto may close via an escrow arrangement with the Title Company. 4.1 Seller's Closing Documents. On the Closing Date, Seller shall execute and deliver to Buyer the following(collectively, "Seller's Closing Documents"), all in form and content reasonably satisfactory to Buyer: 4.1.1 Deed. A Warranty Deed conveying the Real Property to Buyer, free and clear of all encumbrances, except the Permitted Encumbrances (as hereafter defined). 4.1.2 IRS Forms. A Designation Agreement designating the "reporting person" for purposes of completing Internal Revenue Form 1099 and, if applicable, Internal Revenue Form 8594. 4.1.3 Well Certificate. A Certificate signed by Seller warranting that there are no "Wells" on the Property within the meaning of Minn. Stat. § 1031 or, if there are"Wells", a Well Certificate in the form required by law. A-1 4.1.4 Storage Tanks. If the Property contains or contained a storage tank, an affidavit with respect thereto, as required by Minn. Stat. § 116.48. 4.1.5 Other Documents. All other documents reasonably determined by Buyer or the Title Company to be necessary to transfer the Property to Buyer free and clear of all encumbrances, except the Permitted Encumbrances. 4.2 Buyer's Closing Documents. On the Closing Date, Buyer will execute and deliver to Seller the following(collectively, "Buyer's Closing Documents"): 4.2.1 Purchase Price. Funds representing the Purchase Price,by cash or by wire transfer of immediately available funds. 4.2.2 IRS Form. A Designation Agreement designating the "reporting person" for purposes of completing Internal Revenue Form 1099 and, if applicable, Internal Revenue Form 8594. 5. Prorations. Seller and Buyer agree to the following pro-rations and allocation of costs regarding this Agreement: 5.1 Title Insurance and Closing Fee. Seller will pay all costs of the Title Evidence. Seller will pay the premium required for the issuance of the Title Policy, if an updated abstract of title is not provided. If Seller provides Buyer an updated abstract of title, Buyer shall pay the premium for issuance of the Title Policy. Seller and Buyer will each pay one-half of any closing fee or charge imposed by the Title Company. 5.2 Deed Tax. Seller shall pay all State Deed Tax payable in connection with this transaction. 5.3 Real Estate Taxes and Special Assessments. Real Estate Taxes payable in the year in which Closing occurs shall be pro-rated based upon the Closing Date. On or before the Closing Date, Seller will pay all special assessments levied or pending against the Property. 5.4 Other Costs. All other operating costs of the Property shall be allocated between Seller and Buyer as of the Closing Date, so that Seller pays that part of operating costs payable before the Closing Date, and Buyer pays that part of operating costs payable from and after the Closing Date. 5.5 Attorneys' Fees. Each of the parties will pay its own attorneys' fees, except that a party defaulting under this Agreement or any Closing Document will pay the reasonable attorneys' fees and court costs incurred by the nondefaulting party to enforce its rights hereunder. A-1 6. Title Examination. Title Examination will be conducted as follows: 6.1 Seller's Title Evidence. Seller shall, within 10 days after the date of this Agreement, furnish the following (collectively, "Title Evidence") to Buyer: (a) a commitment ("Title Commitment") for an ALTA Form B 1990 Owner's Policy of Title Insurance insuring title to the Real Property, in the amount of the Purchase Price, issued by the Title Company; (b) if the Property is abstract property, Seller shall also deliver to the Title Company or to Buyer any Abstract of Title in Seller's possession, to the Real Property certified to a current date to include all appropriate judgment and bankruptcy searches; (c)UCC searches against Seller. 6.2 Buyer's Objections. Within 15 days after receiving the last of the Title Evidence, Buyer will make written objections ("Objections") to the form and/or contents of the Title Evidence. Any matter shown on such Title Evidence and not objected to by Buyer within the foregoing 15-day period, shall be a"Permitted Encumbrance" hereunder. Seller will have 60 days after receipt of the Objections to cure the Objections, during which period the Closing will be postponed, if necessary. Seller shall use its best efforts to correct any Objections. To the extent an Objection can be satisfied by the payment of money only, Buyer shall have the right to apply a portion of the cash payable to Seller at the Closing to the satisfaction of such Objection, and the amount so applied shall reduce the amount of cash payable to Seller at the Closing. If the Objections are not cured within such 60-day period, Buyer will have the option to do any of the following: 6.2.1 Terminate this Agreement and receive a refund of the Earnest Money and the interest accrued and unpaid on the Earnest Money, if any; or 6.2.2 Withhold from the Purchase Price an amount which, in the reasonable judgment of the Title Company, is sufficient to assure cure of the Objections. Any amount so withheld will be placed in escrow with the Title Company, pending such cure. If Seller does not cure such Objections within 60 days after such escrow is established, Buyer may then cure such Objections and charge the costs against the escrowed amount. The parties agree to execute and deliver such documents as may be reasonably required by the Title Company; or 6.2.3 Waive the Objections and proceed to close. 6.3 Title Policy. Buyer shall receive at Closing the title policy("Title Policy") issued by Title pursuant to the Title Commitment, or a suitably marked Title Commitment initialed by Title obligating Title to issue such a Title Policy in the form required by the Title Commitment as approved by Buyer. 7. Operation Prior to Closing. During the period from the date of Seller's acceptance of this Agreement to the Closing Date (the "Executory Period"), Seller shall operate and maintain the Property in the ordinary course of business in accordance with prudent, reasonable business standards, including the maintenance of adequate liability insurance and A-1 insurance against loss by fire, windstorm and other hazards, casualties and contingencies, including vandalism and malicious mischief. Seller shall execute no contracts, leases or other agreements regarding the Property during the Executory Period that are not terminable on or before the Closing Date, without the prior written consent of Buyer, which consent may be withheld by Buyer at its sole discretion. 8. Representations and Warranties by Seller. Seller represents and warrants to Buyer as follows: 8.1 Existence; Authority. Seller (Lois Mahlberg and Paul Schoeller) has the requisite power and authority to enter into and perform this Agreement and Seller's Closing Documents; such documents are valid and binding obligations of Seller, and are enforceable in accordance with their terms. 8.2 Operations. Seller has received no notice of actual or threatened cancellation or suspension of any utility services or certificate of occupancy for any portion of the Property. 8.3 Environmental Laws. No toxic or hazardous substances or wastes, pollutants or contaminants (including, without limitation, asbestos, urea formaldehyde, the group of organic compounds known as polychlorinated biphenyls, petroleum products including gasoline, fuel oil, crude oil and various constituents of such products, and any hazardous substance as defined in any Environmental Law (collectively, "Hazardous Substances") have been generated, treated, stored, transferred from, released or disposed of, or otherwise placed, deposited in or located on the Property in violation of any Environmental Law, nor has any activity been undertaken on the Property that would cause or contribute to the Property becoming a treatment, storage or disposal facility within the meaning of any Environmental Law. The term "Environmental Law" shall mean any and all federal, state and local laws, statutes, codes, ordinances, regulations, rules, policies, consent decrees, judicial orders, administrative orders or other requirements relating to the environment or to human health or safety associated with the environment, all as amended or modified from time to time. There has been no discharge,release or threatened release of Hazardous Substances from the Property, and there are no Hazardous Substances or conditions in or on the Property that may support a claim or cause of action under any Environmental Law. The Property is not now, and to the best of Seller's knowledge never has been, listed on any list of sites contaminated with Hazardous Substances, nor used as landfill, dump, disposal or storage site for Hazardous Substances. Seller has maintained all records required to be kept concerning the presence, location and quantity of asbestos containing materials, and presumed asbestos containing materials, in the Property and will deliver the same to Buyer on or before Closing. 8.4 Seller's Defaults. Seller is not in default concerning any of its obligations or liabilities regarding the Property. A-1 8.5 FIRPTA. Seller is not a "foreign person", "foreign partnership", "foreign trust" or"foreign estate", as those terms are defined in Section 1445 of the Internal Revenue Code. 8.6 Proceedings. There is no action, litigation, investigation, condemnation or proceeding of any kind pending or threatened against Seller or any portion of the Property. 8.7 Condition. The buildings, structures and improvements included within the Property are structurally sound and in good repair and condition, and all mechanical, electrical, heating, air conditioning, drainage, sewer, water and plumbing systems are in proper working order. All fixtures, equipment and appliances included in the Property are in proper working order. 8.8 Wells. The Seller certifies and warrants that the Seller does not know of any "Wells" on the described Property within the meaning of Minn. Stat. § 103I. This representation is intended to satisfy the requirements of that statute. 8.9 Sewage Treatment System Disclosure. For the purposes of satisfying any applicable requirements of Minn. Stat. § 115.55, Seller discloses and certifies that: a) Seller has no knowledge of the existence of an abandoned individual sewage treatment system on the Property. b) Sewage generated on the Property goes to a facility permitted by the Minnesota Pollution Control Agency. Seller will indemnify Buyer, its successors and assigns, against, and will hold Buyer, its successors and assigns, harmless from, any expenses or damages, including reasonable attorneys' fees, that Buyer incurs because of the breach of any of the above representations and warranties, whether such breach is discovered before or after Closing. Except as herein expressly stated, Buyer is purchasing the Property based upon its own investigation and inquiry and is not relying on any representation of Seller or other person and is agreeing to accept and purchase the Property "AS IS, WHERE IS" subject to the conditions of examination herein set forth and the express warranties herein contained. Consummation of this Agreement by Buyer with knowledge of any such breach by Seller will not constitute a waiver or release by Buyer of any claims due to such breach. 9. Casualty. If all or any part of the Property is substantially damaged by fire, casualty, the elements or any other cause, Seller shall immediately give notice to Buyer, and Buyer shall have the right to terminate this Agreement and receive back all Earnest Money by giving notice within 30 days after Seller's notice. If Buyer shall fail to give the notice, then the parties shall proceed to Closing, and Seller shall assign to Buyer all rights to insurance proceeds resulting from such event and shall pay to Buyer the amount of any deductible or co-insurance. 10. Broker's Commission. Seller and Buyer represent to each other that they have dealt with no brokers, finders or the like in connection with this transaction, and agree to A-1 indemnify and hold each other harmless from all claims, damages, costs or expenses of or for any other such fees or commissions resulting from their actions or agreements regarding the execution or performance of this Agreement, and will pay all costs of defending any action or lawsuit brought to recover any such fees or commissions incurred by the other party, including reasonable attorneys' fees. 11. Assignment. Neither party may assign its rights under this Agreement before or after the Closing. 12. Survival. All of the terms of this Agreement and warranties and representations herein contained shall survive and be enforceable after the Closing. 13. Relocation Benefits. Seller hereby voluntarily waives any and all relocation assistance, services, payments and benefits pursuant to Minn. Stat. § 117.521 pursuant to the Waiver of Relocation Benefits attached hereto as Exhibit B. 14. Notices. Any notice required or permitted hereunder shall be in writing and given by personal delivery upon an authorized representative of a party hereto; or if mailed by United States registered or certified mail, return receipt requested, postage prepaid; or if deposited cost paid with a nationally recognized, reputable overnight courier, properly addressed as follows: If to Seller: LOIS MAHLBERG 13265 Killdeer Street NW Coon Rapids, MN 55448 With Copy to: PAUL SCHOELLER 6740 29th Street North Oakdale, MN 55128 If to Buyer: THE CITY OF HUGO 14669 Fitzgerald Avenue North Hugo, MN 55038 Attn: Mike Ericson With Copy to: ECKBERo LAw FIRM 1835 Northwestern Avenue Stillwater, MN 55082 Attn: Timothy Paul Brausen Notices shall be deemed effective on the earlier of the date of receipt or the date of deposit, as aforesaid; provided, however, that if notice is given by deposit, the time for response to any notice by the other party shall commence to run one business day after any such deposit. Any party may change its address for the service of notice by giving notice of such change 10 days prior to the effective date of such change. 15. Miscellaneous. The paragraph headings or captions appearing in this Agreement are for convenience only, are not a part of this Agreement, and are not to be A-1 considered in interpreting this Agreement. This written Agreement constitutes the complete agreement between the parties and supersedes any prior oral or written agreements between the parties regarding the Property. There are no verbal agreements that change this Agreement, and no waiver of any of its terms will be effective unless in a writing executed by the parties. This Agreement binds and benefits the parties and their successors and assigns. This Agreement has been made under the laws of the State of Minnesota, and such laws will control its interpretation. 16. Remedies. If Buyer defaults under this Agreement, Seller shall have the right to terminate this Agreement in accordance with the applicable Minnesota statutes. If Buyer fails to cure such default within the statutory cure period, this Agreement will terminate, and upon such termination Seller will retain the Earnest Money as liquidated damages, time being of the essence of this Agreement. The termination of this Agreement and retention of the Earnest Money will be the sole remedy available to Seller for such default by Buyer, and Buyer will not be liable for damages or specific performance. If Seller defaults under this Agreement, Buyer, as the sole remedy available to Buyer for such default by Seller, may seek specific performance of this Agreement. Seller and Buyer have executed this Agreement as of the date first written above. Date of Signature SELLER 92006 By LOIS MAHLBERG, a Personal Representative of the Estate of Jean C. Schoeller Date of Signature 2006 By PAUL SCHOELLER, a Personal Representative of the Estate of Jean C. Schoeller Date of Signature BUYER THE CITY OF HUGO, a i sota municipal rporatio 92006 By- EXHIBIT A Land A-1 i City of Hugo 14669 Fitzgerald Avenue North Hugo, MN 55038 PHONE: (651) 762-6300 FAX.- (651) 426-2859 EMAIL: info@ci.hugo.mn.us August 16, 2006 Alex and Zina Minich 2150 Arcade Street Maplewood, MN 55109 Dear Alex and Zina: At its August 7, 2006 meeting, the Hugo City Council voted unanimously to allow you 30 days in which to have the motel and house demolished at The End Zone site located at 13891 Forest Blvd. Specifically, you must have the demolition contractor remove both motel buildings and the house, as per State Statute, which requires asbestos removal under Minnesota Pollution Control Agency standards. Before work commences,you must submit a completed demolition permit and City fee to Building Official John Benson. This work should also include the removal of the white panel truck and mowing of weeds and grass. All demolition and clean up work must be completed by September 7,2006. If the work is not completed,the City of Hugo will authorize a contractor to complete the work with costs to be assessed against your property, as per State Statute and City Code. Thank you for your cooperation. Please contact Building Official John Benson at 651- 762-6313, if you have any questions. Sincerely, ichael A. Ericson City Administrator C: Mayor and City Council Building Official John Benson City Attorney Dave Snyder City of Hugo 14669 Fitzgerald Avenue North Hugo, MN 55038 PHONE: (651) 762-6300 FAX.- (651) 426-2859 EMAIL: info@ci.hugo.mn.us July 19, 2006 CERTIFIED MAIL Mr. Alex &Zina Minich 2150 Arcade St. Maplewood,MN 55109 OFFICIAL NOTIFICATION RE: FIRE, HEALTH, AND LIFE SAFETY CODE VIOLATIONS AT 13891 FOREST BLVD. N Dear Mr. &Mrs. Minich: As per our conservation on July 18, 2006,the City of Hugo has received numerous complaints regarding the condition of your property at 13891 Forest Blvd. N,Hugo, MN 55038. An inspection of the property was conducted on July 14, 2006, and again on July 18, 2006. Present at the inspection were Eric Jensen,Washington County Department of Health&Environmental Specialist, Marty Schwartz,Hugo Fire Marshal, Matt Stemwedel,Administrative Intern, and myself, Hugo's Code Enforcement Officer. The following items are considered a nuisance and are in violation of Chapter 200s: 1. Sec. 200-3, (3),the accumulation of garbage and rubbish not in containers. 2. Sec. 200-3, (5),the accumulation of tin cans,bottles, glass,trash and other debris. 3. Sec. 200-3, (6),the throwing, dumping of garbage,human waste,decaying matter, rubbish,tin cans,glass, and other debris on private property not authorized by law. 4. Sec. 200-3, (8),noxious weeds and other rank growth on the property. 5. Sec. 200-4,(8),the ownership, possession or control of any unused refrigerator to be exposed and accessible to the public without removing the doors. 6. Sec. 200-4, (18),the buildings have been damaged to an extent that the amount of damage exceeds one-half of their original value, and are in disrepair as to endanger the safety of the public. 7. Sec. 200-4, (19),the condition of a property that is liable to cause injury to a person or property of others. Mr. Alex Minich July 19, 2006 Page 2 Please be advised that the buildings have been declared "hazardous buildings" as defined under State Statutes 463.15 Subd. 3, and a public nuisance under Chapter 200-1 (1) of the City of Hugo's Municipal Code. Please take the following corrective action immediately: 1. Remove all bottles, broken glass, mattress, garbage and everything else that are in the buildings to a lawful landfill. 2. Remove the refrigerator from the building to a lawful recycle center. 3. Remove all plumbing fixtures from the site and seal all waste lines. 4. Install 3/4"plywood on every opening on each of the four buildings on the property. The plywood must be fastened to the building in such a way as to prevent ingress into the buildings. 5. Cut all noxious weeds and grass throughout the property. 6. Remove commercial truck and all the refuse in the truck from the site. 7. Schedule an inspection of the site to insure compliance. 8. Send letter to the City verifying that there is no occupancy of the buildings. As the property owner, you are responsible for the immediate abatement and correction of all violations. Should the property not be in total compliance by July 28,2006, this matter will be placed on the August 7, 2006 City Council agenda for further action. Please contact me at(651) 762-6313 to discuss this letter and the situation regarding your property. Sincerely, John Benson Code Enforcement Officer Cc: Mayor& City Council Mike Ericson,City Administrator Bryan Bear, Community Development Director Marty Schwartz,Fire Marshal Eric Jensen, Environmental Specialist,Washington County Washington County Sheriff's Department Matt Stemwedel, Administrative Intern .4.i TO: Mike Ericson, City Administrator FROM: Tom Denaway, Administrative Intern SUBJECT: Handbook for newly appointed members of the Hugo EDA DATE: August 12, 2004 Overview: The purpose of this handbook is to provide a guide to the newly appointed members of the Economic Development Authority for the City of Hugo. This handbook will first look at what we are seeking to achieve when we do economic development, it will lay out the tools available to the EDA to fulfill its goals, and finally it will provide a potential course of action for discussion by the board members. What is Economic Development? Economic Development, as defined by the Federal Economic Development Administration of the Commerce Department, is fundamentally about enhancing the factors of productive capacity— land, labor, capital, and technology—of a national, state, or local economy. By using its resources and powers to reduce the risks and costs which could prohibit investment, the public sector often has been responsible for setting the stage for employment—generating investment by the private sector. The public sector generally seeks to increase incomes, the number of jobs, and the productivity of resources in regions, states, counties, cities, towns and neighborhoods. Its tools and strategies have often been effective in enhancing a community's: • labor force (workforce preparation, accessibility, cost); • infrastructure(accessibility, capacity, and service of basic utilities, as well as transportation and telecommunications); • business and community facilities (access, capacity, and service to business incubators, industrial/technology/science parks, schools/community colleges/universities, sports/tourist facilities); • environment (physical,psychological, cultural, and entrepreneurial); • economic structure (composition); and • institutional capacity (leadership, knowledge, skills)to support economic development and growth. Essentially what the Economic Development Administration is trying to say is that economic development is the growth of community, through the growth of economy. At its root economic development is a coordinated effort at growing a city's tax base through the growth of its job base, ultimately leading to a better community with greater amenities. Economic development is a systematic planned approach at bringing business and development into the city. Everything we do as a city springs from our tax base which is bolstered by increased development and investment, all of the quality of life services and facilities provided by the city come from its tax base. Therefore anything which is designed to expand this base has to be of the utmost importance. What are we doing when we do economic development? Economic development consists of two primary functions. The first function is the marketing of a city as a place for business to locate, and the second being the assistance of a business in their effort to locate in your city. These two functions work hand in hand, and are almost codependent in their existence. When a city engages in active economic development it is attempting to foster business growth. There are a wide variety of forms and tools that this takes but in the end, they can be divided into marketing activities and financing activities. The purpose of these actions is to be an enabler, to allow projects come to fruition which would not without assistance from the city. The Economic Development Administrations phrases it as the city using its resources and powers to help reduce risks and costs which would prohibit investment, the public sector often has been responsible for setting the stage for employment-generating investment by the private sector. It is the city stepping forward and closing a financial gap enabling business to develop and grow within the city. A significant motivation for a city's involvement in economic development is selfish; it is the city seeking to beat other cities and states. Cities will take an active role in closing a financial gap, because if they don't another likely will, and they will reap the benefits. Therefore cities need to be proactive, and competitive in their effort to court business. There are a wide variety of organizations available to a city and a community that seek to become involved in economic development activities. These organizations include: business organizations, development corporations, and various government organizations. The Minnesota Department of Trade and Economic Development (DTED) groups these organizations into three categories: Business Organizations: • Commercial Club: Usually an incorporate 501(c)(4)or (6) organization whose purpose is to promote community and retail events. The membership is usually made up of retail business owners or owners of businesses in the central or downtown business district. The organization is typically made up of volunteers with no staff. • Chamber of Commerce: A Chamber of Commerce is an incorporated, non- profit 501(c)(4)or(6)that is usually affiliated with the state and national chamber of commerce. Its primary purpose is to promote local businesses and the community. Development Corporations: • For-Profit: A corporation formed to develop and sell industrial land and/or provide financing for business development within the community. Shares are sold to local investors who can be paid dividends for profits made on projects. Also, money invested in corporations can be repaid to the stockholders. The board is made up of shareholders and may or may not have staff. The corporation is subject to federal and state income tax. • Non-Profit: A corporation formed to develop and sell industrial land and/or provide financing for business development in the community. Shares are sold or funds may be raised in other ways. No dividends are paid on shares. The non-profit corporation must obtain either 501 (c)(3) or 501 (c)(4)status from the IRS. Donations made to a 501(c)(3) by both individuals and businesses is tax deductible. Obtaining 501(c)(3) status can be difficult, expensive and time- consuming and many communities are not willing to go through the lengthy process. Also, organizations with 501(c)(3) status are usually not politically active due to IRS regulations limiting budget expenditures on political activities to 20 percent of its budget. Governmental Organizations: • Development Commission: An advisory board, appointed by the Mayor with City Council approval. It has limited or no decision-making authority and usually serves as a sounding board or as a first point-of-contact for the City council for development projects. It is often responsible for drafting strategies and policies for ratification and implementation by the City. The commission may be active in implementation of local plans on a volunteer basis. • Housing Redevelopment Authority (HRA): An HRA is a legal entity created by a City Council to provide a sufficient supply of adequate housing for low-to-moderate income families and individuals. They are also charged with clearing and redeveloping blighted areas throughout community. The board may be a citizen's panel, the City Council or a combination thereof. HRAs also have limited powers that may be used for business development. • Port Authority: This is a legal entity created by the State Legislature to promote the general welfare of a city's port district, increase the volume of commerce in the port, provide facilities for handling, storage, and shipment of freight. The powers of a Port Authority are more expansive then those of an HRA or an EDA in one significant respect, Port Authorities have the ability to issue General Obligation Bonds with the City Council approval. Economic Development Authority (EDA): EDAs were created to facilitate a well-rounded development program by taking advantage of some of the Port Authority powers and all of the HRA powers. By combining and utilizing HRA,EDA, and City powers, community leaders are able to create flexible business assistance and development programs. EDAs for example, are allowed,to buy and sell property; make loans and grants to businesses; provide guarantees or other credit enhancements; and to sell bonds. These agencies are important players in the business of economic development. While they may seem irrelevant because Hugo decided to go with an EDA, they are still important and must be noted. An important task for the EDA to complete will be partnering with these other organizations in order to work in collaboration towards economic development. A close relationship with these other agencies will provide the EDA with access to tools and networks that it would not have on its own, making it essential that EDA seek out their involvement Why an Economic Development Authority? The Hugo City Council on July 19, 2004 passed the Enabling Resolution Modifying the Hugo EDA. The City, technically already had formed an EDA that was composed of City Council. However, this EDA was only utilized in a few specific instances. The reformation of the EDA is a result of the renewed interest in the City Council for fostering development in Hugo, along with the desire to have more public involvement in the process, thus a seven member board was formed with two Council members serving on the EDA. Mary Ippel, of Briggs and Morgan, describes the forming of an EDA as a way to provide a great deal of flexibility to a City to pursue economic development. Economic development authorities may exercise their own powers,the powers of housing and redevelopment authorities, the powers of cities in connection with city development districts and the powers of municipalities or redevelopment agencies in connection with municipal industrial development. The purpose for which these powers may be exercised is expanded to embrace economic development throughout a City and not just in areas deemed blighted. The concentration of various economic development powers and purposes in one Authority therefore provides a valuable tool to a City for the promotion and financing of economic development. An EDA is provided, by State Statute, the greatest level of power and freedom to participate in economic development. An EDA possesses the most ability and the widest variety of tools to work towards closing financing gaps. Simply put, an EDA is the most effective tool at solving problems of economic development. Tools of the EDA There are two categories of tools utilized by EDA to foster business growth in Cities. These tools can be broken down into marketing tools and financial assistance tools. The marketing tools exist as a means for the City to sell itself as a quality location for business to locate or expand in. The financial assistance tools exist to assist business in closing financial gaps, which would otherwise cause them not to locate in your city. Because these two categories represent the backbone of the activities of the EDA, they will be examined in greater length to better understand; the philosophy behind their use; the specific tools available to fulfill the philosophy; and a potential course of action for the City of Hugo. Marketing Philosophy The philosophy behind marketing a City is a simple one, you have to sell your City,especially in a large urban area like the Twin Cities. It is very difficult to differentiate between what two neighboring communities have to offer, and it can be something as simple as a economic development newsletter for example that can cause a business to locate in one city as opposed to another. Therefore the marketing of a City can be an essential service of the EDA, and can and will be the tool which initiates business growth and expansion in a City. The marketing efforts of an EDA need to focus on two key areas,what your City has to offer and what opportunities are currently available. You have to provide reasons why a business should locate in your City, but equally important is the marketing of the opportunities that currently exist in your community. You want to tell potential business why they should be there at what is available to them. Selling a community is an essential function. You really need to highlight why your City is unique and attractive. This can be a result of its location. Oakdale for example plays to the fact that it is located at the intersection of I-94 and 694 making it easily accessible. You can highlight the fact that there is tremendous growth taking place in a City. Here in Hugo we can play on all of the new development, and the fact that these new residents are going to need services and places to work. You can highlight the level of education in a City, in Hugo the soon to be constructed elementary school is an extremely attractive feature, and something that differentiates us from other communities. Cities can market things that may be unique to them, such as a new school or their location, but the marketing of the amenities a City has to offer maybe the most important aspect. All Cities provide amenities to their residents, it is one of the core reasons for their existence,but not all Cities provide the same level of amenities; which is why it is essential that Cities demonstrate exactly what they have to offer. The City of Hugo may have a lot of growth and a new elementary school,but it also has a rapidly expanding parks program,with one new park currently being built and another in the works. It has a newly formed public works department that is now providing local control and responsibility for maintaining the City's roadways. It has a very active Lions club, which sponsors many annual events with the highlight being Hugo Good Neighbor Days. All of these things are amenities that the City has to offer. The amenities that residents want to see in their communities are the same thing business want to see when they examine a community. Therefore the most effective marketing tool a City possesses is its amenities, and the continued creation and development of these will not only create a better residential community, but a better business community as well. These points of emphasis, which suggest a City is an attractive location for business to locate usually speak for themselves and need little explanation and elaboration. What has to be marketed is the current opportunities available for the location of a business in your City. For example, the City of Hugo, in its marketing efforts needs to highlight both the amenities that the City possess, but also the recently developed space in the Bald Eagle Industrial Park, or the Pelequin Industrial Park, or any of the other available space for the location of a business, be it raw land, or new office space. Potential businesses need to be aware of what Hugo has to offer as a community, in terms of amenities and opportunity. Marketing Tools There are a variety of tools available to an EDA that can be utilized to fulfill the goal of marketing the City. These tools range from;Economic Development Newsletters, Marketing Videos, Business Retention Visits, as well as a number of simple steps, that can be used to spread information about business opportunities in a City. The tools that will be examined represent a portion of what is available to Cities and present a variety of costs. Business Retention Visits The City of Oakdale has found that one of the easiest tools for marketing the City is Business Retention Visits. This tool is unique in the fact that its target audience is not businesses outside of the community seeking to locate in Oakdale, but businesses already located within the City. A business retention visit is a fairly simple idea, it is simply an effort by City Staff and Elected Officials to get out into the community and speak with business owners. The notion behind this tool is the fact that future business growth in a city has a higher likelihood of coming from a business that is already located in the city then from an outside business coming in. As a result, the City of Oakdale decided they needed to get staff and elected officials out in the Oakdale Business Community to start speaking with the businesses already located there and to start forming relationships with these businesses so that when it becomes time to expand they look inward at opportunity in Oakdale, as apposed to opportunities elsewhere. By conducting these visits Oakdale has found that a number of business where simply unaware of the opportunities for growth that was present in their community, as well as some of the financial assistance tools the City had to offer. Business Retention Visits are an essential tool for the Hugo EDA to utilize, made particularly important by their dual nature. With the reformation of the EDA, and its intended goal of creating business development and growth in the City of Hugo,has come trepidation from the local business community and the fear that they will be forgotten or wiped out. Business retention visits will go along way to relieving this fear by allowing the local business community to be heard, but more importantly to know that they come first. The goal of the EDA is to see growth in business in Hugo,this does not simply mean new business growth, but more importantly the growth of business already located in the City. Business retention visits have a dual nature because not only do they seek to create awareness of growth opportunity in Hugo,but they do it by putting existing business owners first. Economic Development Newsletters Cities can very successfully advertise business growth opportunities through the use of newsletters. These newsletters can be distributed not only to existing community members, but to people outside the community as well. By utilizing existing mailing lists from the community itself and neighboring Business Associations and Chambers of Commerce, Cities are more equipped to advertise the opportunities available in their communities. These newsletters are able to highlight the growth opportunity available to business already located in a community, but they are also able to extend beyond the boundaries of the City, and can truly work to attract business from outside the community. These newsletters are able to not only showcase the potential for development in a community, but they are excellent forums for marketing the recent successes of a community. Nothing is as powerful as a strong success story, which makes it essential for newsletters to illustrate future growth as well as past successes. Community Marketing Video Communities in the past have prepared short videos,which highlight exactly what the City has to offer. The philosophy behind these videos is the same as all of the other marketing tools, i.e. spread the word about the great benefits of locating in City X. These videos are then provided to businesses who inquire about possibly locating in the City. Typically these videos will highlight City amenities, as well as previous and ongoing projects. The goal with these videos is to paint a picture of what your City has to offer, and why it should be chosen over another City. In addition to providing copies to people who inquire about the City, they can also be aired on local public access stations. By airing them both internally in a community and in external markets the City is hoping to draw attention to itself and what it has to offer. The downside to these videos is they can be somewhat expensive to produce, and can become outdated rather quickly. Marketing Conclusions The above-mentioned tools represent specific actions the Hugo EDA can take towards marketing the opportunities that are currently available. The goal of all three of these tools is simply to spread the word, both about what the City has to provide to its residents, but also what business opportunities exist. The three tools presented are also unique in that they represent three points on the spectrum in terms of sophistication and cost. In the case of the Hugo EDA, it would probably not be necessary to jump right into the creation of a marketing video. The Hugo EDA will most likely progress along the spectrum by starting with Business Retention Visits, followed by a Newsletter,with the Marketing video being on the horizon farther down the line. Probably the most vital of these tools is the Business Retention Visits,especially during the first formative stage of the EDA. As previously stated the visits should go a long way to reassure local business owners by reminding them that the goal of the EDA is business development, which does not simply mean outside business moving into the City. If Business Retention Visits are the first step in the marketing plan for the Hugo EDA, then an E.D. Newsletter would be the logical follow-up. The benefit of the newsletter would be the increased exposure it would provide, which would far surpass the reach of the business retention visits. The newsletter would probably be implemented a short while after the formation of the EDA, essentially the EDA needs to set some groundwork and framework for itself before it would begin using a newsletter. The benefit to this is that the newsletter would be able to spread the word of the EDA, basically as it is formed and evolves. The use of the newsletter would be beneficial to the purpose of the EDA for reasons beyond simple marketing. By employing a newsletter the EDA would have a means of communicating with the residents of Hugo about what, its intentions, goals, policies etc...are. The flow of this information from City Hall to the residents of Hugo will provide the EDA with the buy-in it needs to be successful and grow in its role. Additionally the newsletter would be relatively inexpensive and would probably be circulated quarterly to begin with, with the eventual evolution to a bi-monthly publication. I imagine that it would be a while before the EDA would be willing to cover the cost of a marketing video. A marketing video would be the final step used by the EDA to market opportunities in Hugo, and would really only be beneficial if there was a number of business making inquiries about locating in Hugo, otherwise the video would go relatively unused and would not reach an audience much larger than the newsletters. Additionally,Marketing Videos are prone to becoming obsolete and need semi-frequent investment to keep things updated. The above-mentioned tools represent the hard and fast marketing tools that the Hugo EDA has available to it. However they do not encompass all of the tools available to the EDA. The tool that will likely be the most effective is simply networking. The EDA needs to utilize City Staff to become actively involved with the other development related community and area-wide agencies. By being active in an area chamber of commerce the City will be better equipped to market the opportunities for growth that it posses, while reaching a wider audience in the process. As the old adage states, "Its not what you know, but who you know!" Basic straightforward networking and involvement in area agencies is possibly the best marketing tool an EDA possess. Financial Assistance Tools As previously mentioned the functions of an EDA is two-fold, its goals are to market the City as a place for businesses to develop, and it can also act to assist business meet financial gaps in their efforts to locate within the City. Essentially what this means is that EDA's and Cities have the power to remove portions of the financial burden placed on businesses in their efforts to move into your City,EDA's can work to close financial gaps that may exist. There are instances where business would like to develop in a City,but the cost of doing so prevents it. In these circumstances Cities and EDA can use their power to provide money or cover certain costs in order to close these gaps,provided a certain test has been passed. This test is what is known as the"but-for"test. The DTED Economic Development Handbook provides this definition of the But for Test; "A statutory requirement that a municipality, in approving creation of a tax increment district, must find that the "proposed development or redevelopment, in the opinion of the municipality, would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future." The municipality must also find that the use of TIF will increase the market value of the site over that which would occur without tax increment financing." What the"But For Test" seeks to is create a level of responsibility to the use of public assistance. By meeting the burden of proof set forth in the "But For Test" Cities are able to demonstrate the fact that they are not in the business of giving money to private industry without receiving something in return. The burden of proof in the "But For Test" is whether or not the project would be possible if the assistance was not provided. If a business could make it work without the assistance, it would fail to meet the test and would not be eligible for assistance. While the DTED definition of the "But for Test" specifically mentions the use of the test in regards to Tax Increment, it is sound policy to require the test to be met in all aspects of local government financial assistance. The notion of government using tax dollars to assist private business is a difficult one for residents to comprehend. In seeking to answer why this is done,three key items need to be elaborated on; the increased tax base this development will provide, the fact that the development would not happen without assistance(but for test), and the fact that in most instances of assistance the money is either loaned or will be recouped in captured tax revenue. By illustrating these three points the City is able to illustrate the fact that the assistance will ultimately provide great reward to the City with little cost being burdened by the City. Three of the most popular forms of assistance, and the ones that will be examined in greater detail here, are Tax Increment Financing,Tax Abatement, and Revolving Loan Funds. These three tools are going to be looked at in detail because they are indeed three of the most popular forms of assistance, and they represent different points on the spectrum of assistance in terms of complexity and cost. Revolving Loan Funds Revolving Loan Funds will be examined first because they are the relatively easiest of the three in terms of complexity and monetary amounts involved. These types of funds are used provide assistance to businesses through the use of small low interest loans, which can be used to close small financial gaps. Programs like these can be used to provide funds to local business seeking to expand, or to help small start up businesses get going. The philosophy behind this type of program is the notion that the City can appropriate a portion of its funds for use in loans, which will then be repaid with interest over time. These loans provide relief to businesses and allow them to meet financing needs without having to provide the large amounts of personal capital most private sources require before providing financing. These loans are only to be used as an enabler and in situations where the but for test is met. Revolving loan programs are attractive to cities because they are relatively simple,usually only require a one-time investment, which can be recouped and used again. The fact that these loans are relatively small in amount, and the fact that they are loans, means they will inherently be less complicated that a tax increment financing deal or a tax abatement deal. Additionally,cities typically only need to make one budget appropriation to get a program of this type started. This appropriation will eventually be repaid by the business, plus interest, and will be able to be used again. Because of these factors revolving loan funds are attractive programs to cities and EDAs and are a good first step program for these agencies to utilize as they enter the economic development game. In the case of Hugo, it is my opinion that a budget appropriation to start a revolving loan program would be a very prudent investment, which would provide the newly formed EDA with a strong foundation as it moves forward. Ultimately the most appealing aspect of these programs is their revolving nature, i.e. the fact that they will be repaid and used to fund other future projects. The City has the option to leave money sitting in reserve, for a rainy day, or it can use a small portion of that money to fund a revolving loan fund, all the while knowing that if worse comes to worse once the loan is repaid it can be used to cover a deficit. Tax Increment Financing If Revolving Loans represent one end of the spectrum of complexity and investment, then Tax Increment Financing(TIF) is on the other. TIF provides cities and EDAs with the greatest potential in regards to the amount of financial assistance that can be provided. This type of financing is used to fund huge public improvement ventures and is a key tool that cities possess in order to make development happen. TIF is based on a relatively simple concept, though its actual application is infinitely more complicated. TIF is based on the notion that a new development will create a larger tax base then what was previously being provided. Development on a particular parcel will add value to that property thus creating increased revenue. The amount of tax revenue being generated before development is designated as the Original Tax Capacity. The amount of tax revenue being generated after development will undoubtedly be greater than the original tax capacity; the difference between the pre- development revenue and the post-development revenue is defined as Increment or captured tax capacity. The basic philosophy behind TIF is that cities can capture this increment and use it as a tool to pay off financial assistance that was provided to create the development. In laymen's terms because the City will receive increased income from a project it will provide funding for the project; all the while knowing that it would recoup this investment in the newly captured increment. What truly makes TIF unique and able to fund expensive projects is the fact that the City not only captures its share of the increment, but it is able to capture the amount which would under normal circumstances go to the county and school district. Therefore the City is able to leverage great amounts of money knowing they will be able to recoup their investment through the captured increment. According to Ehlers &Associates "TIF Basics" increment may be used to assist development with; land acquisition; site improvements; public and on-site utilities; demolition; relocation; and to some extent administration. This allows the City to, for example,provide land to a business to develop on. By removing such a large cost the City is able to financially assist businesses in developing in the City. The key element that dictates all TIF funding is the but for test, if a project does not meet the requirements of a but for test, it is therefore ineligible for funding through TIF,and as previously explained should truly be ineligible for all City funding. The ability to pass the test, ensures that any assistance that is contributed is done in the publics interest and not just as a private industry subsidy. What appeals to Cities with TIF is the ability to provide substantial assistance to development, which will ultimately grow the tax base of the City. Additionally, the City ultimately is repaid for their assistance, and does not have to shoulder any financial burden. For example the City of New Brighton is seeking to use TIF financing to provide a site for the new Medtronic corporate headquarters. In doing so they will pay for the cost of the development of the site, thus significantly reducing the cost to Medtronic, which allows them to relocate to New Brighton; something that would not happen without the use of TIF. In return for their investment the City will have a new piece of property with significantly higher than it previously was. The City will be reimbursed the money it invested through captured tax increment, in the end the development will come at little to no cost to the city once the repayment is created, and instead of having a piece of property providing tax revenue of$1 million it will have a property producing a tax revenue of$5 million. The theory behind TIF as explained is relatively simple; TIF in actual practice is extremely complicated and extremely closely monitored. TIF can only be used in specific situations and for specific reasons, with each instance having its own criteria. Entire 20 page papers can be written about single details of TIF laws, what is important here is the philosophy, and how it applies to the EDA of the City of Hugo. In the case of the Hugo EDA providing financial assistance through TIF would only happen with Council Consent, and would be provided for a project that would truly reshape the landscape of Hugo. For example the City may decide to assist a developer seeking to redevelop a portion of downtown Hugo. In the instance where substantial financial assistance is required the City would use TIF to allow the development to proceed. In such a case the revenue to be gained by the development would have to be great enough to justify assistance, and would truly be a landmark development in the City. Not all TIF deals are on the magnitude of New Brighton's,but they all must cover the cost of doing business. TIF is an extremely valuable tool for the EDA, in conjunction with the Hugo City Council, as it provides the EDA with the necessary tool to hit the proverbial homerun. TIF is the tool that is used when all others fail to foot the bill. Tax Abatement aka. "TIF-Lite" Tax Abatement operates under a similar concept as TIF, is less complex, but is limited in its financial contribution. Abatement operates under the same concept of TIF in the fact that it captures revenue that is generated by development, and other properties located in the "abatement district." Simply put the City defines a geographic region whose tax revenue is going to be captured to provide financial assistance to a project. The reason Tax Abatement generates a lesser amount of money is two-fold. First, only the City's portion of the revenue can be captured, as opposed to city, county, and school portion that TIF provides. Secondly, Cities are limited by MN State Statutes in the fact that they can only capture $200,000 or 10% of the Cities tax levy whichever is greater. Therefore any funding which tax abatement is used for is inherently going to be of a lesser amount than TIF would provide. The benefits of abatement arise from its relative simplicity in comparison to TIF. It is not as highly regulated as TIF, and does not have to meet the criteria that usually accompany a TIF project. Tax Abatement provides cities with an option that still allows for a substantial amount of funding to be provided to a project, without the complexity of TIF. Financial Assistance Conclusions All of the above mentioned tools are presented in terms of the theory of their use. The implementation of any of these tools has to be on the basis strong public policy that regulates their use. It is essential that anytime a City or EDA uses public funds to provide assistance to private industry, it has to be done for the right reasons, which is why the policy is so important. It is my opinion that before any of these tools are utilized, the prospective project must meet the but for test, if not it simply does not warrant City involvement; save the occasional exception. In addition to the but for test the prospective development must significantly better the City's tax revenue,because if it does not there is little reason to put forth the effort. Finally I would like to see the EDA operate with the philosophy that any potential assistance provided by the City be in a form where the City is able to recoup their investment. The City is not in a position where it has to provide straight grants to businesses to foster development. Conclusions I would like to see the Hugo EDA take the "If we advertise it, they will come approach." The first two priorities of the Hugo EDA should be to set a policy specifically laying out the requirements for providing financial assistance. This is simply the most important aspect of the EDA,without a clearly defined policy to rely on there is no control/reason over what gets assistance and what does not. Without this policy the EDA will simply not be able to justify its actions. The three elements that are necessary for the policy are; that every project should provide significant benefit to the residents of the City; that every project should pass the but for test; and that all financial assistance should be of a renewable form. In addition, to setting a policy in regards to providing funding, is the fact that the EDA needs to define a course of action. I would like to see the EDA act under a notion of, "If we market it, they will come." I feel that the EDA can take the position that its most important priority is to advertise the opportunity that is available in Hugo, and what Hugo has to offer. The marketing of the City is what will lead to business development in Hugo, and if some of the prospective businesses need assistance in locating here, and they meet the funding policy requirements; they will be eligible to potentially receive funding from the EDA and the City. What is important to note is that the EDA and the City are not in the business of providing money and subsidy to private industry,they are only willing to provide assistance when the results substantially benefit the citizens of Hugo. The single most important job the EDA possesses and therefore its goal is the marketing of what Hugo has to offer, the financial assistance is only ancillary. By taking this approach the City will take the necessary first steps towards fostering development and growth in Hugo. An effective marketing campaign will attract business, which will create a greater tax revenue for the City, and will provide greater amenities to the citizens of Hugo. The people who serve as commissioners on the board of the Hugo EDA will be provided with the power to shape the future of Hugo, but more importantly they will posses the power to create the future Hugo. If you advertise it, they will come References Economic Development Authorities, Mary Ippel, J.D. Briggs and Morgan, P.A. Sept. 25, 1992. Economic Development Handbook,Department of Trade and Economic Development; in conjunction with Springstead Inc. The Handbook for Minnesota Cities, The League of Minnesota's Website, www.lmnc.or,g, Mary Ippel, J.D. Briggs and Morgan P.A.,Personal Interview, April 07, 2004 Paul Steinman,Financial Advisor, Springstead Inc.,April 08,2004 What is Economic Development, Economic Development Administration,U. S. Department of Commerce, Website: www.eda.gov, MINUTES FOR THE EDA MEETING OF SEPTEMBER 18,2006 EDA President Fran Miron called the meeting to order at 8:30 am. PRESENT: Jan Arcand, Jim Bever, Tom Denaway, Mike Granger, Phil Klein, Fran Miron, and Brian Thistle ABSENT: None City Administrator Mike Ericson, CD Director Bryan Bear, CD Intern Rachel Simone APPROVAL OF MINUTES Klein made motion, Granger seconded, to approve the minutes for the EDA meeting of August 21, 2006 as presented. All aye. Motion Carried. PREMIER BANK CD Intern gave an overview of Premier Bank moving into the building formally occupied by Lake Area Bank located at 14815 Forest Blvd. They are planning on doing some maintenance of the building but for the most part it is staying the same. Staff invited the representatives from Premier Bank to come talk to the EDA about the bank and their community involvement. The Staff recommended the EDA welcome Premier Bank as a new business in the community. Bill Miller the Vice President of the bank was present and gave a presentation on the background of the bank and their community involvement. He asked the EDA to let him know if there were any community projects the bank could be involved in. He also stated that their grand opening would be October 12th-16th. Miron stated that the building that Lake Area Bank was in was intended for a temporary use and that a permanent Premier Bank would we welcomed by the City. The City Administrator stated that there many opportunities in Hugo for community involvement. DISCUSSION ON TIF DISTRICT ESTABLISHMENT Staff has been working closely with Paul Steinmen of Springsted and Mary Ippel on the calculations to establish a TIF District. Staff attached a map of the proposed TIF District that highlights the buildings that meet and do not meet the required 15% code deficiency threshold determined by building inspections. Also the building department has done some preliminary assumptions about the buildings that the city has not inspected and if they would qualify for a TIF district or not. Staff gave an update at the meeting on the coverage test and building inspections and requested direction from the EDA related to proposed TIF boundary. CD Intern gave an overview of the attached map and building inspections. CD Director talked about the building inspection process and the time it takes to complete the reports. He also stated that we are still working on what is going to happen in regards to the Lavalle parcel and the new County road. Miron asked if staff thinks the TIF District would be challenged and what would happen if it did. Bever asked CD Director if he thinks the City will be able to count the Lavalle parcel as occupied. CD Director stated staff does not think this would be challenged. He used Richfield as an example of one that was challenged because they condemned land and the city is not condemning land for the proposed TIF District. He stated that the Lavalle parcel being deemed occupied is important to the proposed TIF District. If it is not considered occupied the district will not meet the coverage test and may have to be removed from the proposed district. He stated that staff and consultants are still working on this issue. Granger asked about the Stock Lumber site and the accessory structures on the property. He also asked about the 145th Street property owners. CD Intern stated that the building inspectors just inspected the Stock Lumber site and that the accessory structure will not be used in the building inspection reports. There were calls made to the remaining property owners that did not respond to the letters sent about the building inspection. Some of them were on 145th Street and they either did not call back or stated that they did not want the inspection done on their property. Arcand asked if there were still developers interested in developing in the downtown area. CD Director stated that we still get calls from developers and business owners that that would like to be located in the downtown. Klein asked if we should be thinking about a bigger TIF district that would include County Road 8. Miron stated that we need to think about what property would develop on its own and what area would need some encouragement. Denaway stated that it seems as though that County Road 8 is developing on its own. UPDATE ON THE END ZONE PROPERTY AND THE SCHOELLER PROPERTY CD Intern gave an over view of the End Zone Property and Schoeller property. CD Director talked about the demolition of the End Zone buildings and the environmental assessment that was done on the buildings. Granger asked if the City Council would get an update on the End Zone buildings demolition process at its meeting and if the City ends up demolishing the buildings will the property owners be assessed though the county City Administrator stated he would give an update at the City Council meeting. There will be an assessment if the City has to demolish the buildings. Denaway asked if staff has taken the proper steps to consider the buildings substandard for the TIF district establishment. CD Intern stated that the steps have been taken and resolutions have been passed. MISCELLANEOUS Denaway introduced his brother Robbie who was attending the EDA meeting for a class. CD Director asked the EDA if they liked the business's coming in to introduce themselves to the EDA. All seemed to favor the favor the visits. Bever stated that the EDA should tour the businesses that are coming in. Granger stated that the City maybe should look into another industrial park that caters to businesses of heavy industrial uses. Bryan stated that staff will look into that and there may be a spot for them in the City some where. This could be a discussion topic at one of our next meetings. Klein asked about the availability of high speed internet for businesses in the City. Granger stated that there is one in town called Stonebridge. CD director stated that staff is thinking about making a residential spread sheet for properties in the City like we have for retail property on the website. Denaway stated that staff should look at the City of Cottage Grove's website to get a good idea of what to do for the spread sheet. ADJOURNMENT Denaway made motion, Klein seconded to adjourn the meeting at 9:30 am All aye. Motion carried.