City of Saint Peter, Minnesota

CITY OF SAINT PETER, MINNESOTA

OFFICIAL PROCEEDINGS

MINUTES OF THE SPECIAL MEETING ECONOMIC DEVELOPMENT AUTHORITY MEETING

December 6, 2006

Pursuant and due call and notice thereof, a special meeting of the Economic Development Authority (EDA) of the City of Saint Peter was conducted in the Governor’s Room of the Community Center on December 6, 2006.

A quorum present President Sam Gault called the meeting to order at 12:00 p.m. The following members were present: Sam Gault, Paul Tanis, Jr., John Kvamme, Joel Brinker, Mike Favre, and Greg Seitzer. City staff present was Director of Community Development Rosten Wille.

Approval of Agenda

A motion was made by Favre, seconded by Seitzer, to approve the agenda. With all in favor, the agenda was approved.

Unfinished Business

NONE

New Business

Revolving Loan Request – Liz Beaudry

Wille stated that Liz Beaudry has submitted a Revolving Loan request in the amount of $50,000 to help with the acquisition of Envision: Design That Works, from Nancy Jordet. Wille indicated the total acquisition cost is determined to be $191,000 which includes the business of price of $185,200 and working capital of $5,800.

Wille said Ms. Beaudry has been working with President Tim Grabow of HomeTown Bank to prepare the necessary project financing. He said HomeTown Bank intends to submit a $128,000 loan application to the Small Business Administration (SBA) seeking a guarantee through the “7a” program. He indicated Ms. Beaudry has pledged to provide $12,500 in cash and is seeking the revolving loan monies to fill the remaining “gap”.

Ms. Beaudry addressed the EDA and said she was the sole proprietor of Beaudry Creative prior to being employed by Envision. She expressed her desire to purchase Envision and incorporate Beaudry Creative into the business. She indicated that she has been employed by Envision the past two years and has managed many of Envisions largest accounts.

Jordet spoke very highly of Ms. Beaudry and stated she was very confident the business would flourish and continue to grow under Beaudry’s ownership and direction. Jordet said she planned to work extensively with Envision clients as a paid consultant.

Wille recommended the $50,000 loan be approved to finance the acquisition of the business assets of Envision: Design That Works, at an interest rate of 5%, amortized on a ten year schedule with a balloon payment after five years. Wille stated that Beaudry will provide joint and several personal guarantees and that UCC filings shall be recorded as collateral against the fixtures, furnishings, equipment and accounts receivable of the business. He added that the UCC filings may be subordinate to those required by the participating bank.

Kvamme asked if the loan should be visited by the EDA sooner than five years because of the limited amount of collateral.

Tanis felt that other revolving loans were collateralized well enough to take a chance on this loan.

Favre said Beaudry has provided a very good business plan and it shows very good projections. Favre also added that Envision was an established business.

Tanis said the EDA should use Beaudry’s application as an example for future projects.

Favre indicated that in the future he would like to review personal financials prior to making a decision on under collateralized loans.

A motion was made by Tanis, seconded by Brinker to introduce Resolution No. 2006-18 entitled, “A Resolution Recommending Approval Of A $50,000 Revolving Loan To Beaudry Creative, Inc. To Finance The Acquisition Of Envision: Design That Works”.

The following amendments were made to the resolution; delete “applicable” in #3, delete #4 “A subordinate mortgage shall be obtained on the Beaudry residence located at 43332-371^st Avenue, Saint Peter, in the name of the City of Saint Peter and #6 replace building with business.

All members voting aye, the Resolution was passed and adopted.

Reports

Brinker announced that he will be resigning his position on the EDA on December 31, 2006.

Adjournment

There being no further business, a motion was made by Tanis, seconded by Kvamme to adjourn. With all in favor, the meeting adjourned at 1:00 p.m.

CITY OF SAINT PETER, MINNESOTA

OFFICIAL PROCEEDINGS

MINUTES OF THE REGULAR MEETING ECONOMIC DEVELOPMENT AUTHORITY MEETING

November 30, 2006

Pursuant and due call and notice thereof, a regular meeting of the Economic Development Authority (EDA) of the City of Saint Peter was conducted in the Governor’s Room of the Community Center on November 30, 2006.

A quorum present Vice President Paul Tanis called the meeting to order at 12:00 p.m. The following members were present: Paul Tanis, Jr., John Kvamme, Mike Favre, Ken Eichman, and Greg Seitzer. City staff present was Director of Community Development Rosten Wille. Visitor present was Mike Riley.

Approval of Agenda

A motion was made by Kvamme, seconded by Seitzer, to approve the agenda. With all in favor, the agenda was approved.

Approval of Minutes

A motion was made by Eichmann, seconded by Seitzer to approve the minutes of August 24, 2006. All members voting aye, the minutes were approved as presented.

A motion was made by Eichmann, seconded by Seitzer to approve the minutes of October 18, 2006. All members voting aye, the minutes were approved as presented.

Kvamme stated the July 27, 2006 minutes have not been approved. Wille will include them on the next agenda for EDA approval.

Unfinished Business

NONE

New Business

Brick Zen Mortar Limited Liability Co. - Revolving Loan Request

Wille stated that Brick Zen Mortar, LLC has submitted a Revolving Loan request in the amount of $60,000 to partially finance the renovation of the second floor of the Danby building (324 South Minnesota) to accommodate an expansion of MacKenzie & Gustafson operations.

Mike Riley addressed the EDA. He explained that the expansion would include handicap restrooms, additional office space and a meeting/conference room. He also stated that by tying the Schaeffer, Mason, and Danby buildings together, the current elevator would serve the three buildings making them all handicap accessible.

Wille said that the applicant has requested that the EDA provide a $60,000 loan to finance 50% of the anticipated demo and reconstruction costs. Wille said Nicollet County Bank (NCB) has already approved a $60,000 loan to finance the balance of the project costs. He said NCB wants the City to subordinate the first mortgage to them.

Wille said the project meets the recently modified Revolving Loan Fund Guidelines. He said the public benefit of the project would include; additional job creation and an increased taxable value on the building.

Discussion was held regarding adequate collateralization of the proposed loan. Brick Zen Mortar, LLC partners Riley and Tanis said they were comfortable with securing the $60,000 mortgage jointly against the 322, 324 and 326 South Minnesota Avenue properties. Wille said that personal guarantees will also be provided by Tanis and Riley as well as their spouses.

A motion was made by Kvamme, seconded by Seitzer to introduce Resolution No. 2006 – 17 entitled, “A Resolution Recommending Approval Of A $60,000 Revolving Loan To Brick Zen Mortar, LLC To Finance The Partial Renovation And Rehabilitation Of A Commercial Structure Located At 324 South Minnesota Avenue”.

A motion was made by Kvamme, seconded by Seitzer to amend the Resolution to read; 4) A $60,000 mortgage shall be secured jointly against 322, 324, and 326 South Minnesota Avenue property in the name of the City of Saint Peter; and delete numbers 5 and 6. Members Eichmann, Favre, Kvamme, and Seitzer voting aye, Member Tanis abstaining, the motion carried.

Members Eichmann, Favre, Kvamme, and Seitzer voting aye, Member Tanis abstaining, the Resolution was passed and adopted.

Reports

Spec Building – Wille reported that the spec building has not been sold or leased. He said the Development Corporation has requested that the repayment of the loan be deferred for an additional twelve months. Wille said formal action will be taken at the January EDA meeting.

Jeremy Blaschko – Bowlero Lane - Wille explained Bowlero Lanes had a malfunction in their auto scoring system. He stated the replacement cost was approximately $90,000 and that owner Jeremy Blaschko was interested in pursuing a revolving loan. He indicated that Blaschko did not own the building but was purchasing the equipment, machines, fixtures, and furnishings and leasing the space. Wille said that Blaschko found other funding.

Revolving Loan Policies – Wille reported that he would be setting up a meeting with DEED along with City Administrator Todd Prafke, and Finance Director Paula O’Connell regarding DEED’s revolving loan policy requirements.

Resignation - Wille announced Joel Brinker will be submitting his resignation to the Mayor.

Adjournment

There being no further business, a motion was made by Brinker, seconded by Seitzer to adjourn. With all in favor, the meeting adjourned at 12:40 p.m.

CITY OF SAINT PETER, MINNESOTA

OFFICIAL PROCEEDINGS

MINUTES OF THE SPECIAL MEETING ECONOMIC DEVELOPMENT AUTHORITY MEETING

October 18, 2006

Pursuant to due call and notice thereof, a special meeting of the Economic Development Authority (EDA) of the City of Saint Peter was conducted in the Saint Peter Room at the Saint Peter Community Center on October 18, 2006.

A quorum present President Sam Gault, Jr. called and meeting to order at 12:00 p.m. The following members were present: Sam Gault, Jr., Paul Tanis,, Jr. Mike Favre, Joel Brinker, Ken Eichmann, Greg Seitzer and John Kvamme. City staff present was Director of Community Development Rosten Wille and Administrative Secretary Cindy Moulton.

Approval of Agenda

A motion was made by Gault, seconded by Kvamme, to approve the agenda. With all in favor, the agenda was approved.

New Business

Wille stated that Chippewa Packaging has outgrown their current building; and that if they are to expand their customer base, they need a larger productions space. Wille indicated that they have expressed some interest in the spec building.

Wille reviewed the current financial obligations related to the spec building. He stated that a total of $411,831 has been invested into the spec building to date. He said financial obligations include; a Revolving Loan in the amount $260,000 (3% interest, 30 year amortization/10 year balloon), lot cost - $54,781, Mason Street improvements $23,240 and Saint Peter Development Corporation cash contributed $73,810 (5% interest, 20 year amortization and term).

Wille stated that the building, as is, would need to generate an annual lease rate of $22,946.64, not including taxes and insurance. With the addition of taxes and insurance, the total annual lease would be $41,046.64 or $4.10/square foot/month.

Wille stated that the spec building is basically a shell with minimal electricity. He indicated that the building is in need of a concrete floor, water and sewer, electricity and a paved parking lot. Wille estimated the cost of the 4” concrete floor and paved parking lot to be $100,000. Wille said that if Chippewa should move into the building this fall or winter, the Development Corporation would need to obtain City Council approval to allow a gravel parking lot until spring.

Gault recommended that the Development Corporation and EDA proceed with Chippewa. Gault said he would be interested in obtaining firm numbers from Chippewa.

Eichmann asked if additional loans would be made to the Development Corporation or Chippewa. Wille stated the funds would be loaned to the Development Corporation.

A motion was made by Brinker, seconded by Tanis to support the proposed project and to loan additional funds to the Development Corporation in order to make improvements to the spec building. Discussion continued. Kvamme asked if there were any other funding alternatives. Tanis suggested that the EDA contact MCCF again. Members Tanis, Favre, Brinker, Eichmann, Seitzer voting aye, Member Gault abstaining, the motion carried.

Report

Wille reported that the City Council will be approving the EDA By-Laws and Revolving Loan Fund Guidelines at their October 23, 2006 meeting.

Adjournment

A motion was made by Tanis, seconded by Seitzer to adjourn the meeting. The meeting adjourned at 12:26 p.m.

CITY OF SAINT PETER, MINNESOTA

OFFICIAL PROCEEDINGS

MINUTES OF THE REGULAR MEETING ECONOMIC DEVELOPMENT AUTHORITY MEETING

August 24, 2006

Pursuant and due call and notice thereof, a regular meeting of the Economic Development Authority (EDA) of the City of Saint Peter was conducted in the Governor’s Room at the Saint Peter Community Center on August 24, 2006.

A quorum present President Sam Gault called the meeting to order at 12:00 p.m. The following members were present: Sam Gault, Jr., Paul Tanis, Jr., Mike Favre, and Joel Brinker. City staff present were Director of Community Development Rosten Wille and Administrative Secretary Cindy Moulton.

Approval of Agenda

A motion was made by Brinker, seconded by Tanis, to approve the agenda. With all in favor, the agenda was approved.

Approval of Minutes

A motion was made by Tanis, seconded by Brinker to approve the minutes of June 1, 2006. All members voting aye, the minutes were approved as presented.

A motion was made by Tanis, seconded by Brinker to table the minutes of July 27, 2006 until the September meeting. All members voting aye, the minutes were tabled.

Unfinished Business

Louise Fry (Bradford)- A Golden Dream

Wille stated that in 1999 the City provided Louise Fry (Bradford) and a partner a $30,000 revolving loan to purchase inventory in order to open A Golden Dream jewelry store. In 2000, Fry’s business partner abandoned the business and filed Chapter 7 bankruptcy. Wille stated that the partner’s debt was discharged through the bankruptcy proceedings leaving Ms. Bradford as sole debtor.

Wille said that in 2001 Fry closed the store due to inadequate sales and declining revenues. A going-out-of-business sale liquidated the majority of remaining inventory.

Wille said that since the closing of the store, Fry has been unable to make the payments on a regular basis as scheduled.

Wille reported that the note pay off on August 31, 2006 would be in the amount of $7,349.63. He said the original loan was at an interest rate of 6% and the balance was to be paid in full on December 31, 2006.

Wille said that Bradford contacted him and stated she would not be able to pay off her loan by December 31, 2006. She also indicated that her payment of $438.26 per month was prohibitive. Fry asked if the repayment schedule could be modified through refinancing to reduce her scheduled monthly payment.

Wille recommended that the Fry debt be refinanced to provide for repayment of a four year term at a reduced interest rate of 3%. Will said that Bradford indicated that her current personal financial situation would allow her to honor the scheduled $162.68 per month.

A motion was made by Tanis, seconded by Favre to introduce Resolution No. 2006-09 entitled, “Resolution Recommending The Refinancing And Modification Of Terms Of The A Golden Dream (Bradford) Debt” with the addition of 4) Automatic payments will be made in the amount of $162.68 per month. All members voting aye, the Resolution was passed and adopted.

Report

Wille stated that Wayne Wandersee dba DATC LLC will be constructing the Johnson Hall Chemical Dependency building on a portion of the triangular piece of property he purchased from the City. He said Wandersee will construct the building and rent it to the State. Wille also stated that the City will extend the lease with the State at 618 West Broadway until the new building is ready for occupancy.

EI Microcircuits would like an option on Lot 4 in the North Industrial Park. They have also requested that the City hold another job fair this fall.

Tanis suggested that the Ambassadors, EDA and Development Corporation look at creating some type of signing bonus for persons taking jobs in Saint Peter. Tanis and Wille will meet to discuss options.

Wille suggested making the job fair an annual event which would take place each November.

Wille reported that the foundation for the General Dollar Store has been poured.

Wille stated that the site selection committee for Walmart maybe meeting with City Administrator Todd Prafke in the future.

Adjournment

A motion was made by Brinker, seconded by Tanis to adjourn the meeting. The meeting adjourned at 12:23 p.m.

CITY OF SAINT PETER, MINNESOTA

OFFICIAL PROCEEDINGS

MINUTES OF THE REGULAR MEETING ECONOMIC DEVELOPMENT AUTHORITY MEETING

Thursday, July 27, 2006

Pursuant and due call and notice thereof, the regular meeting of the Economic Development Authority (EDA) of the City of Saint Peter was conducted in the Basement Conference Room of the Municipal Building at Noon on July 27, 2006.

In the absence of the President and Vice President, EDA member John Kvamme chaired the meeting. Kvamme called the meeting to order at 12:04 p.m.

EDA members Kvamme, Greg Seitzer, Ken Eichmann and Joel Brinker were in attendance. Members Sam Gault Jr., Paul Tanis and Mike Favre were unable to attend as scheduled. Community Development Director Russ Wille was also in attendance.

Approval of Agenda

A motion was made by Brinker, seconded by Seitzer, to approve the agenda as presented. With all in favor, the agenda was approved.

Approval of Meeting Minutes

Motion by Seitzer, seconded by Eichmann to approve the minutes of the June 22, 2006 meeting as presented. With no noted corrections, all voting in favor, motion carried.

Motion by Brinker to approve the minutes of the July 14, 2006 special meeting as presented. Seconded by Seitzer, all voting in favor, motion carried.

Speculative Home Bids

Community Development Director Wille reported that bids have been solicited for the construction of four speculative homes in the Washington Terrace Subdivision. Five licensed contractors have submitted bids for consideration. Staff has determined that the low, responsive bidder is Jim’s Construction of Saint Peter with a total bid of $437,219.00.

Motion by Brinker, seconded by Eichmann to introduce Resolution No. 2006-13, entitled, “RESOLUTION AWARDING BID FOR THE CONSTRUCTION OF FOUR SPECULATIVE HOMES WITHIN WASHINGTON TERRACE SUBDIVISION”. The resolution awards the construction bid to Jim’s Construction at a cost of $437,219. With no further discussion, all voting in favor, the Resolution was passed and adopted.

Construction Management Contract

Community Development Director Wille recommends that a contract be entered into between the Saint Peter Economic Development Authority and the Southwest Minnesota Housing Partnership (SWMHP) for construction management services. SWMHP proposes to conduct the construction management services at a price of $4,750 per home. Wille noted that it is his opinion that the increase cost is warranted and appropriate.

Motion by Brinker, seconded by Eichmann, to introduce Resolution No. 2006-14, entitled, “RESOLUTION AUTHORIZING THE PRESIDENT OF THE ECONOMIC DEVELOPMENT AUTHORITY TO EXECUTE CONTRACTS WITH THE SOUTHWEST MINNESOTA HOUSING PARTNERSHIP FOR CONSTRUCTION MANAGEMENT SERVICES”. With no further discussion, all voting in favor the Resolution was passed and adopted.

Speculative Home Sale Prices

After an analysis of the bids and “soft” construction costs, the SWMHP has been able to assess and recommend sale prices for the four speculative homes to be constructed within Washington Terrace. Wille noted that he was very pleased that the price of the 2006 homes will actually be lower that the prices of the homes begun in 2004.

Motion by Brinker, seconded by Eichmann to introduce Resolution No. 2006-15, entitled, “RESOLUTION ESTABLISHING SALES PRICES FOR ECONOMIC DEVELOPMENT AUTHORITY CONSTRUCTED SPECULATIVE HOMES WITHIN WASHINGTON TERRACE SUBDIVISION”. With no further discussion, all voting in favor the Resolution was passed and adopted.

Adjourn

With no further business before the EDA, motion by Seitzer, seconded by Eichmann to adjourn. Kvamme adjourned the meeting at approximately 12:40 p.m.

CITY OF SAINT PETER, MINNESOTA

OFFICIAL PROCEEDINGS

MINUTES OF THE SPECIAL MEETING ECONOMIC DEVELOPMENT AUTHORITY MEETING

July 14, 2006

Pursuant and due call and notice thereof, a special meeting of the Economic Development Authority (EDA) of the City of Saint Peter was conducted in the downstairs meeting room City Hall on July 14, 2006.

A quorum present President Sam Gault called the meeting to order at 12:00 p.m. The following members were present: Sam Gault, Jr., Paul Tanis, Jr., Mike Favre, Ken Eichmann and Joel Brinker. City staff present were; Director of Community Rosten Wille, Administrative Secretary Cindy Moulton, and City Attorney James Brandt. Visitors present: Fred Struck, owner of Traverse des Sioux Garden Center and Cindy Blaschko

Approval of Agenda

A motion was made by Brinker, seconded by Eichmann, to approve the agenda. With all in favor, the agenda was approved.

Unfinished Business - none

Subordination Request – Struck

Wille stated that Lydell and Joy Struck dba Traverse des Sioux Garden Center received a revolving loan in the amount of $60,000 in 1999. He stated that the loan is secured by a second mortgage against the commercial property located on Old Minnesota Avenue. He also said the outstanding balance of the note is approximately $36,108.

Wille said the Struck’s are seeking to refinance the debt of Traverse des Sioux Garden Center. He said Ag Star Financial Services has agreed to provide Traverse des Sioux with a $190,700 loan to refinance the existing mortgage while consolidating short-term debt. Wille stated that Ag Star is requiring that the EDA subordinate their security position and allow Ag Star to occupy the first mortgage position.

Wille added that a February, 2006 appraisal established a market value of $340,000.

A motion was made by Kvamme, seconded by Eichmann to introduce Resolution No. 2006-12 entitled, “Resolution Recommending The Subordination Of City Held Mortgages For The Refinancing Of The Traverse des Sioux Garden Center (Struck) Debt”. All members voting aye, the Resolution was passed and adopted.

Wille stated the city Council will take action of the subordination request at their July 24, 2006 meeting. Upon City Council approval Wille requested that Ag Star provide the subordination on their form.

Reports

Members expressed their concern regarding potential law suits when determining interest rates for various revolving loans. City Attorney Brandt stated that consistency is a problem.

Another concern of the EDA was the chance of being accused of discrimination. Brandt stated that the safest practice would be to follow banking guidelines. Gault and Tanis felt that the amount of the interest rate assigned to a loan should be justified with the resolution. Gault and Favre were asked to meet and develop criteria as to where the interest rate should be set and bring their suggestions back to the EDA for their input.

Adjournment

Tanis and Gault stated they would not be at the next EDA meeting.

There being no further business, a motion was made by Tanis, seconded by Favre to adjourn. With all in favor, the meeting adjourned at 12:15 p.m.

CITY OF SAINT PETER, MINNESOTA

OFFICIAL PROCEEDINGS

MINUTES OF THE REGULAR MEETING ECONOMIC DEVELOPMENT AUTHORITY MEETING

June 22, 2006

A quorum present Member Paul Tanis called the meeting to order at 12:01 p.m. The following members were present: Paul Tanis, Jr., John Kvamme, Ken Eichmann, and Greg Seitzer. City staff present was Director of Community Development Rosten Wille.

Approval of Agenda

A motion was made by Kvamme, seconded by Seitzer, to approve the agenda. With all in favor, the agenda was approved.

Approval of Minutes

A motion was made by Kvamme, seconded by Eichmann to table the approval of the June 1, 2006 minutes until the July 27, 2006 meeting. With all members voting aye, the motion was approved.

Unfinished Business

Eichmann addressed the EDA and stated that until the revolving guidelines are modified, he would be voting no for any revolving loan requests that did not meet the current criteria.

Greg Seitzer – RLF Application

Wille stated that Greg Seitzer has requested a $60,000 revolving loan to finance the partial renovation and rehabilitation of a commercial structure located at 302 South Minnesota Avenue.

Wille stated that the second floor of 302 South Minnesota was previously used for unheated storage space and now residential construction is being undertaken to generate additional building revenue. Wille said that upon completion, the residential occupancy of the second floor and the generated revenue will assist in maintaining an affordable commercial lease rate.

Wille indicated that the loan would be secured through the acquisition of a second mortgage against the 302 South Minnesota Avenue property. He stated that Nicollet County Bank holds a first mortgage against the property in the original principal sum of $80,000.

Wille recommended that the loan of $60,000 be approved, amortized on a fifteen year payment schedule, with an interest rate at 3% per year. He said a second mortgage in the amount of $60,000 would be secured in the name of the City of Saint Peter. He also stated a personal guarantee and promissory note will be executed.

A motion was made by Kvamme, seconded by Eichmann to introduce Resolution No. 2006-11 entitled, “A Resolution Recommending Approval Of A $60,000 Revolving Loan To Gregory And Jan Seitzer To Finance The Partial Renovation And Rehabilitation Of A Commercial Structure Located At 302 South Minnesota Avenue”.

Discussion was held. Eichmann stated that he had the same reservations with this loan as he did with the Sweat Equity loan at the last meeting.

Kvamme said that although Eichmann’s concerns were valid, the roll of the EDA is to help preserve the downtown district.

Tanis asked if Eichmann would change his mind if the new proposed guidelines were approved as a working draft subject to tweaking some of the language.

Eichmann did not feel comfortable voting in favor of a project using guidelines from a working draft.

Wille indicated that the guidelines needed to be approved by the EDA as well as the City Council before they can be implemented.

Members Kvamme and Tanis voting aye, Member Eichmann voting nay, Member Seizer abstained. The Resolution was passed and adopted.

Loan Policy Guidelines

The EDA reviewed a draft copy of the revolving loan fund guidelines.

Eichmann asked what the difference was between the city boundaries and School District 508 boundaries (Section 3.2). Tanis stated the School District Boundaries included Kasota.

Eichmann questioned section 3.4 Job Creation Requirements. Tanis stated that job creation is not always possible but it may be a good project.

Members discussed section 3.5 Livable Income Favored. Wille stated that the State definition of livable wage is 110% of the poverty level for a family of four.

Eichmann asked what determined the interest rate for each loan (section 4.4). Wille stated that it depended on the risk of the project, the higher the risk project, the higher the interest rate.

Wille recommended that section 6.1 be changed to “Joint and several personal guarantees from company owners (greater than 25% ownership) “may”, be required.

Tanis stated that he will make the suggested changes and wait for additional feedback from members Favre, Gault, and Brinker before any formal action is taken on the revolving loan fund guidelines.

Reports

The Development Corporation is in the process of negotiating an option on the spec building. The business would have the potential of crating fifteen new jobs.

Wille stated that the bid opening for the Washington Terrace spec homes has been moved back two weeks because of topography problems.

City Attorney Brandt is preparing a two year option for Lot 4 in the North Industrial Park for EI Microcircuits. Wille stated that EI will pay $500 for the two year option. He also indicated that EI Microcircuits future expansions will occur in St. Peter.

It was suggested that a new member packet be given to incoming EDA members.

Adjournment

There being no further business, a motion was made by Tanis, seconded by Kvamme to adjourn. With all in favor, the meeting adjourned at 1:00 p.m.

CITY OF SAINT PETER, MINNESOTA

OFFICIAL PROCEEDINGS

MINUTES OF THE SPECIAL MEETING ECONOMIC DEVELOPMENT AUTHORITY MEETING

June 1, 2006

A quorum present President Sam Gault called the meeting to order at 12:02 p.m. The following members were present: Paul Tanis, Jr., John Kvamme, Ken Eichmann, Sam Gault, Jr. and Mike Favre. City staff present was Director of Community Development Rosten Wille.

Approval of Agenda

A motion was made by Tanis, seconded by Favre, to approve the agenda. With all in favor, the agenda was approved.

Approval of Minutes

A motion was made by Tanis, seconded by Eichmann to approve the minutes of the April 27, 2006 EDA meeting. With all members voting aye, the minutes were approved as presented.

A motion was made by Tanis, seconded by Eichmann to approve the minutes of the May 4, 2006 EDA meeting. With all members voting aye, the minutes were approved as presented.

Sweat Equity, LLC - RLF Application

Wille stated that Sweat Equity, LLC has requested at $40,000 revolving loan to finance the partial renovation and rehabilitation of a commercial structure located at 301 South Minnesota.

Wille stated that significant repairs and renovation of the second floor residential units of 301 South Minnesota is necessary. He said that the repairs are necessary to ensure the continued occupancy of the apartments and added that the generated revenue assists in keeping the commercial lease rate affordable.

Eichmann asked how the loan request met the criteria of the revolving loan guidelines. He indicated that the current guidelines prohibit renovation of residential units and also requires job creation with requests over $25,000.

Wille stated that the project is related to the commercial portion of the building. He said that it is important to keep the vitality of downtown and by improving the second floor, it allows for lower rent to the lower level.

Tanis stated that the EDA has discussed making substantial changes to the loan policies in the past. He said the By-Laws Committee had also discussed making modifications to the policy.

Kvamme stated that the intent of the Revolving Loan Fund was to be used as a bridge for non-bankable loans.

Favre asked how strictly the guidelines were enforced. Wille indicated that the regulations have been varied from to provide funding for downtown renovation projects. Wille stated that the EDA made a similar loan to Bushaw which allowed Playing Possum to have a lower rate on the lease to allow the project to cash flow.

Wille stated that the interest rate can be negotiated. He said that the most EDA’s, Port Authorities, and Development Corporations have as much flexibility as possible.

Tanis felt the EDA should become more aggressive in helping the downtown.

Gault felt this was a viable project.

Tanis stated that his heart is in the right place and he isn’t asking for anything that hasn’t been done in the past.

Favre asked Wille to identify the exceptions that have been made to the guidelines and the reasons for the exceptions.

A motion was made by Favre, seconded by Kvamme to introduce Resolution No. 2006-05 entitled, “A Resolution Recommending Approval Of A $40,000 Revolving Loan To Sweat Equity, LLC To Finance The Partial Renovation And Rehabilitation Of A Commercial Structure Located At 301 South Minnesota Avenue”. A motion was made by Favre, seconded by Kvamme to amend the resolution by deleting, “meets the criteria of the loan project” and adding “WHEREAS, the EDA has determined that the prohibition against providing revolving loan funding to residential projects is not applicable to tangential, accessory residential units when they are incidental to the primary commercial use of the structure” and “WHEREAS, the EDA has determined that the job creation criteria of the loan program would not be applicable to building renovation projects within the downtown when such repair/renovation is necessary and appropriate to maintain the utilization and affordability of the primary commercial space”. Members Eichmann, Favre, and Kvamme voting aye, Members Gault and Tanis abstaining, the Resolution was passed and adopted as amended.

MS & GS Enterprises, Inc. – Modification of Loan Terms

Wille reviewed the history of the initial $250,000 loan made to MS & GS Enterprises, Inc. to partially finance the acquisition of the eastern Onan building. Wille stated that the loan was considered a “bridge”

loan that would be replaced by permanent financing subject to approval of the Minnesota Community Capital Fund (MCCF) and Community Reinvestment Fund (CRF)

Wille indicated that MCCF provided their approval in early January, 2004 that the loan was denied by CRF. Wille stated that CRF was contacted in 2005 regarding the possibility of purchasing the MS & GS Enterprises loan from the EDA portfolio and CRF considered the purchase subject to a guarantee provided by the EDA.

Wille suggested that the EDA recommend to the City Council extension of the balloon payment to June 18, 2007 in lieu of selling the loan to CRF subject to the EDA’s guarantee.

Wille stated he will likely recommend that the City withdraw from the CRF. He said to this point it has not been a benefit to the City. He stated the $25,000 membership fee would be reimbursed.

A motion was made by Favre, seconded by Tanis, to introduce Resolution No. 2006-06, entitled, “A Resolution Recommending That The City Council Modify The Terms Of A $250,000 Revolving Loan To MS 7 GS Enterprises”. Members Favre, Kvamme, Tanis and Eichmann voting aye, Member Gault abstaining, the Resolution was passed and adopted.

Business Development Center – Funding Request

Wille stated the Small Business Development Center (SBDC) located at Region Nine Development Commission has requested a $2,500 contribution from the City of Saint Peter to support their operations for the 2006 budget year. Wille said that in 2005, the SBDC served a total of 8 Saint Peter based clients for a total of 62 hours of one-on-one business counseling.

A motion was made by Tanis, seconded by Eichmann to introduce Resolution No. 2006-07 entitled, “A Resolution Recommending A Contribution Of $2,500 To Support The Continued Operations Of The Small Business Development Center”. All members voting aye, the Resolution was passed and adopted.

Swedish Kontur Imports (Anders Bjorling) – Façade Renovation RLF

Wille stated that Anders Bjorling, owner of the Swedish Kontur located at 310 South Minnesota Avenue, has submitted a Façade Renovation Revolving Loan request in the amount of $7,500. Wille indicated that the Heritage Preservation Commission approved the design review for 310 South Minnesota Avenue. Wille stated the loan would be amortized over a five year period with a fixed interest rate of 0% for the duration of the loan.

Tanis suggested that the guidelines be reviewed. He felt that in order to encourage more business owners to restore their store fronts that loans could be made for the total cost of the project at 0% interest for the duration of the loan.

A motion was made by Tanis, seconded by Kvamme, to introduce Resolution No. 2006-08 entitled, “Resolution Recommending That The City Council Provide A $7,500 Façade Renovation Revolving Loan To Swedish Kontur Imports (Anders Bjorling) To Partially Finance The Renovation/Refurbishing Of The Building Located At 224 South Minnesota Avenue”. All members voting aye, the Resolution was passed and adopted.

$700,000 – Greater MN Housing Fund Construction Loan

Wille stated that the Greater Minnesota Housing Fund (GMHF) has partially financed the construction of the speculative homes in Washington Terrace. He said that the GMHF has loaned the EDA $700,000 at 2% interest. He said the loan is to be repaid following the 2007 construction season.

Wille stated that acceptance of the loan required the EDA to sell the speculative homes to families with household incomes below 8-% of the statewide median income. The loan also required the EDA pledge no fewer than seven homes as collateralization of the loan. Wille indicated that the EDA intended to construct only 4 homes during the 2006 construction season. He said that only 4 homes would be secured by GMHF as loan security. Wille stated that as a result, GMHF has ordered the return of $200,000 as per the terms of the applicable note.

A motion was made by Kvamme, seconded by Eichmann to introduce Resolution No. 2006-09 entitled, “Resolution recommending That The City Council Return $200,000 Of A $700,000 Loan From The Greater Minnesota Housing Fund Utilized To Partially Finance The Construction Of Speculative Homes within Washington Terrace Subdivision”. All members voting aye, the Resolution was passed and adopted.

Reports

The theater opening was successful in spite of the weather.

Wille reported that Counseling Services of Southern Minnesota is not going to exercise their option on the lot in the North Industrial Park. Wille stated the City will be returning their earnest money in the amount of $1,000.

The Development Corporation continues to seek a buyer or tenant for their spec building in the North Industrial Park.

Kvamme Tanis, Gault and Wille will review the Revolving Loan Policies and make recommendations at the next EDA meeting.

It was suggested that a new member packet be given to incoming EDA members.

Adjournment

There being no further business, a motion was made Tanis, seconded by Kvamme to adjourn. With all in favor, the meeting adjourned at 1:00 p.m.

CITY OF SAINT PETER, MINNESOTA

OFFICIAL PROCEEDINGS

MINUTES OF THE SPECIAL MEETING ECONOMIC DEVELOPMENT AUTHORITY MEETING

May 4, 2006

A quorum present President Sam Gault called the meeting to order at 12:00 p.m. The following members were present: Joel Brinker, Paul Tanis, Jr., John Kvamme, Greg Seitzer, Ken Eichman, Sam Gault, Jr. and Mike Favre. City staff present was Director of Community Development Rosten Wille.

Visitors present included Steve Tripp, President and Bryan Sieve, BP Finance/Business Development of CineMagic Theatres.

Approval of Agenda

A motion was made by Kvamme, seconded by Brinker, to approve the agenda. With all in favor, the agenda was approved.

Oath of Office

Community Development Director Wille administered the Oath of Office to new member Mike Favre.

Spec Home Solicitation

Wille stated that at the April 27, 2006 EDA meeting it was recommended that a resolution approving construction of four additional EDA spec homes in Washington Terrace, be presented at the next meeting for formal action.

A motion was made by Tanis, seconded by Eichmann to introduce Resolution No. 2006-03 entitled, “A Resolution Authorizing The Solicitation Of Bids For The Construction of Four Spec Homes Within Washington Terrace Subdivision”. Member Brinker expressed his objection to building additional spec homes, and said the City should not be involved as a housing developer. Members Eichmann, Favre, Gault, Kvamme, and Tanis voting aye, Members Brinker and Seitzer voting nay, the Resolution was passed and adopted.

By-Laws

The EDA reviewed the proposed changes to the EDA By-Laws. Tanis stated that the changes made to the By-Laws were very minor. Gault suggested that Director of Finance and EDA Treasurer Paula O’Connell attend one of their meetings and report on the annual report and budget of the EDA.

Administrative Secretary Cindy Moulton was asked to coordinate a meeting with Tanis, Kvamme, Gault, O’Connell, Wille, and City Administrator Todd Prafke.

A motion was made by Tanis, seconded by Brinker to approve the amended By-Laws as presented. All members voting aye, the motion carried.

Theatre – Revolving Loan Fund Application

Wille stated that Cinema 2, LLC has submitted a Revolving Loan request in the amount of $40,000 to partially finance the facilities repair and maintenance necessary to bring about the reopening of the theatre.

Wille highlighted the financial history of the Saint Peter Cinema 5, LLC. Wille indicated that Saint Peter Cinema 5 ceased operations of the Saint Peter theatre in early 2006. He said that the holder of the first mortgage has received ownership of the assets and has successfully negotiated the sale of the property to Cinema2, LLC which plans to open the five screen first run theatre, as early as Memorial Day.

Steve Tripp stated that Cinema 2, LLC, an affiliate of CineMagic Theatres owns Minnesota theatres in Austin, Hutchinson, and Rochester as well as theatres in Menomonie, Wisconsin and Okaboji, Iowa. CineMagic also manages and brokers films for many other area theatre owners.

Tripp stated that after reviewing the previous owners operation, the theatre was grossly underperforming compared to operations in similarly sized communities. Tripp was confident that the Saint Peter theatre could be profitable if managed, marketed and maintained in accordance with their standards and the obstacles the company will be facing is winning back the community.

Wille stated that to assist in financing the acquisition and re-opening, the City Council is expected to consider the re-structuring of the theatre tax increment debt to facilitate the purchase of the theatre assets by a new ownership group. Wille said it is proposed that the Council extend the collection of increment for the full term provided by statute. He added that the Council will also be asked to amend the development agreement to release the new owner from the debt obligations of Saint Peter Cinema 5.

Wille said that due to the historical financial underperformance of the Saint Peter theatre, Cinema 2 has requested a $40,000 Revolving Loan with the following conditions; a 0% interest loan, no scheduled monthly payments, and repayment of the loan in full at the conclusion of the third year of operations. Wille stated that CineMagic provided the Saint Peter Community Development Corporation (SPCDC) with financial details for the project. Wille said that the President of the SPCDC indicated that after reviewing the cash flow projections CineMagic should be able to completely repay the debt after three years of operation.

Wille proposed that the City obtain and record a mortgage against the property in order to secure the debt. He stated the mortgage would be subordinate to the primary financing provided by Nicollet County Bank.

A motion was made by Tanis, seconded by Eichmann, to introduce Resolution No. 2006-04, entitled, “A Resolution Recommending Approval Of A $40,000 Revolving Loan To Cinema 2, LLC To Partially Finance Business Start-Up Expenses”. All members voting aye, the Resolution was passed and adopted.

Adjournment

There being no further business, a motion was made by Tanis, seconded by Seitzer to adjourn. With all in favor, the meeting adjourned at 12:33 p.m.

CITY OF SAINT PETER, MINNESOTA

OFFICIAL PROCEEDINGS

MINUTES OF THE REGULAR MEETING ECONOMIC DEVELOPMENT AUTHORITY MEETING

April 27, 2006

A quorum present President Joel Brinker called the meeting to order at 12:01 p.m. The following members were present: Joel Brinker, Paul Tanis, Jr., John Kvamme, Greg Seitzer and Sam Gault, Jr. City staff present was Director of Community Development Rosten Wille.

Visitors present were Ali Nelson from Southwest Minnesota Housing Partnership (SWMHP) and Patty Pherson of ReMax.

Approval of Agenda

A motion was made by Kvamme, seconded by Gault, to approve the agenda. With all in favor, the agenda was approved.

Election of Officers

A motion was made by Tanis, seconded by Kvamme to elect Gault as President. All members voting aye, the motion carried.

A motion was made by Kvamme, seconded by Tanis to elect Brinker as Vice President. All members voting aye, the motion carried.

A motion was made by Kvamme, seconded by Tanis to elect Director of Finance Paula O’Connell as Treasurer. All members voting aye, the motion carried.

A motion was made by Kvamme, seconded by Tanis to elect Director of Community Development Rosten Wille as Secretary. All members voting aye, the motion carried.

President Gault took over the duties of President.

Approval of Minutes

A motion was made by Tanis, seconded by Kvamme to approve the minutes of the February 23, 2006 EDA meeting. With all members voting aye, the minutes were approved.

A motion was made by Brinker, seconded by Tanis to approve the minutes of the March 16, 2006 EDA meeting. With all members voting aye, the minutes were approved.

Spec Home Discussion

Wille stated that contractors within a 15 mile radius of St. Peter were invited to attend a meeting with Project Manager Rod O’dell of Southwest Minnesota Housing Partnership (SWMHP), regarding the specs of the homes being built by the EDA in Washington Terrace. Wille said the contractors expressed their concern over the use of lesser quality materials during construction. Wille indicated the specs were modified to include middle of the line materials as well as other minor adjustments. Wille said that the major concern expressed by the contractors was keeping business local.

Members asked if it would be more advantageous to approve a bid which was slightly higher but included higher quality materials. Wille stated there must be a legitimate reason to deny a lower bid. He also said that these houses need to maintain affordability.

Members asked whether the contractors building the EDA homes were meeting the specs. Wille indicated that the City and SWMHP have been aggressive in monitoring the construction of the spec homes and assuring that the specs are being met. Wille stated there have been some issues with the present contractor not meeting the specs and having to redo their work.

Wille added that there have been some continued drainage problems with 805 Bassford because of continued construction in the neighborhood. Wille stated that the City will re-grade the alley once the projects are finished.

Brinker asked at what price the SWMHP spec homes were selling. Ali Nelson of SWMHP stated that the price averaged about $140,000. Brinker asked why the City is involved in affordable housing when SWMHP has taken that market. Brinker said he would like to see the EDA become more involved with gap financing for existing homes that are on the market. Brinker stated that there are more houses for sale than buyers at the present time.

Re-Max realtor, Patty Pherson, said there are plenty of affordable homes on the market. She said that the values of homes are decreasing which is hurting existing home owners. Wille felt the buyer/seller ration was at a healthy proportion. Pherson felt there was a ripple affect when City’s get involved in developing.

Wille informed the EDA that he and City Administrator Todd Prafke met with four major lenders to prototype a residential sales enhancement program. They discussed offering a 0% deferred loan to a seller in order to make improvements to their home. Once the home is sold, the loan would be repaid.

Tanis said he was pleased that a meeting was held with the contractors. He entertained that a resolution recommending construction of four additional EDA spec homes be presented at the next meeting.

By-Laws

Because of limited time, discussion and approval of the amended By-Laws will be included on the May 4, 2006 Special Meeting Agenda.

Reports

There is a sale pending on the UBC building located at 948 North Minnesota Avenue. Wille stated a Phase I and Phase II environmental study being completed on the property.

Wille announced that Exceed Packaging and EI Microcircuits have met the Business Subsidy obligations.

Wille stated that Counseling Services of Southern Minnesota’s has an option on a lot in the North Industrial Park which expires August 1, 2006.

Adjournment

There being no further business, a motion was made by Tanis, seconded by Seitzer to adjourn. With all in favor, the meeting adjourned at 1:02 p.m.

CITY OF SAINT PETER, MINNESOTA

OFFICIAL PROCEEDINGS

MINUTES OF THE REGULAR MEETING ECONOMIC DEVELOPMENT AUTHORITY MEETING

March 16, 2006

Pursuant to due call and notice thereof, the regular meeting of the Economic Development Authority (EDA) of the City of Saint Peter was conducted in the Governor’s Room of the Community Center on March 16, 2006.

A quorum present member John Kvamme called the meeting to order at 12:00 p.m. The following members were present: John Kvamme, Ken Eichmann, Greg Seitzer, Sam Gault, Jr. and Paul Tanis. City staff present was Director of Community Development Rosten Wille.

Approval of Agenda

A motion was made by Seitzer, seconded by Gault, to approve the agenda as amended. With all in favor, the agenda was approved.

Spec Home Discussion

Wille recommended solicitation of bids for the construction of four new homes within Washington Terrace. Wille indicated that the Saint Peter is projected to have 1.6% annual population increase through 2009 and that homes would continue to be in demand.

Tanis indicated that local contractors had commented that construction business has been slow. Tanis asked if there was a way to assist local contractors in bidding on these houses, without violating any laws. Gault stated that he had spoken with City Administrator Todd Prafke in the past and the City hadn’t found a plan that would work.

Tanis stated that the local builders are hesitant about bidding on these homes because the homes are perceived to be of substandard construction. He said that when bidding, some contractors are cutting corners but are still able to meet the energy code, which in turn lowers their bid.

It was suggested that a luncheon be held for local contractors located within a 15 mile radius of Saint Peter, and Rod from SWMHP, in regards to the specs. Gault asked if there was also a way to access sub-contractors.

A motion was made by Tanis, seconded by Gault, to move forward with the construction of the four spec homes, with the contingency that a direct mailing be made to local contractors within a 15 mile radius of Saint Peter and that a meeting be held with these contractors in order to fully inform them of the expectation and products to be bid. All members voting aye, the motion carried.

Kvamme reported that when joint meetings are held between the school and City each month, the school administrators ask if the City is going to continue to promote growth. Kvamme felt if the EDA moved forward with the spec homes, the City would be acting in good faith.

North Industrial Lot

Wille stated that the City Council approved a 5% increase in the price of North Industrial Park lots at their March 13, 2006 meeting. He said the increase would not apply toward the lots that are currently under option or the Development Corporation lot.

Meeting Time

A motion was made by Tanis, seconded by Gault, to move the EDA meetings from the third Thursday, to the fourth Thursday of each month at noon. With all in favor, the motion carried.

Reports

Wille said that Johnson Hall currently has a lease with the City for the hospital building until June, 2006. He indicated that the City Council is considering a one month extension to the lease with a condition that the Johnson Hall RFP is out by April. A motion was made by Tanis, seconded by Seitzer to recommend extending the lease as long as necessary. Eichmann stated that there was not reason that the project should be taking this long. He didn’t feel the State was making any progress. Eichmann also reminded the commission that the residence were told there would not be an extension on the lease. Tanis said that he did not want the City to send any negative vibes.

Wille stated that an open house will be held on March 23, 2006, from 4 – 7 p.m. at the Senior Center regarding the 169 Median project. He suggested that the EDA member’s checkout the website at www.dot.state.mn.us.

Wille reported that there is an option on the property located on the NW corner of Old Minnesota and Dodd Road. He stated the potential buyer must exercise the option by March 31, 2006.

Pink Inc. is moving forward with the Waldo’s project. They have not submitted a building permit to date.

Wille indicated that the Dollar General Store has requested a 36’ curb cut and that the city standard is 24’. Wille stated that he would be speaking to Public Works Director Lewis Giesking regarding the issues. Wille said he felt that a 36’ curb cut would be more functional for this type of business.

Wille said that City Administrator Prafke suggested that he and Russ review the By-Laws and submit the changes to the By-Laws committee. Tanis will contact Kvamme and Gault to schedule a meeting next week.

Discussion was held regarding attendance. It was a consensus of the EDA to contact Brinker and Dumdei by letter addressing their absences.

Adjournment

There being no further business, a motion was made by Dumdei, seconded by Seitzer to adjourn. With all in favor, the meeting adjourned at 12:55 p.m.

CITY OF SAINT PETER, MINNESOTA

OFFICIAL PROCEEDINGS

MINUTES OF THE SPECIAL MEETING ECONOMIC DEVELOPMENT AUTHORITY MEETING

Thursday, February 23, 2006

Pursuant to due call and notice thereof, a special meeting of the Economic Development Authority (EDA) of the City of Saint Peter was conducted in the Governor’s Room of the Community Center on February 23, 2006.

A quorum present President Joel Brinker called the meeting to order at 12:00 p.m. The following members were present: Joel Brinker, Ken Eichmann, Greg Seitzer, and Paul Dumdei. Visitor present was Mark Steele, owner of Exceed Packaging. City staff present was Director of Community Development Rosten Wille.

Approval of Agenda

Wille added item B) Meeting Time, under new business. A motion was made by Seitzer, seconded by Eichmann, to approve the agenda as amended. With all in favor, the agenda was approved.

Subordination of Mortgage – Exceed Packaging

Wille stated that the City approved a $250,000 loan to MS & GS Enterprises, Inc. to partially finance the acquisition of 907 Swift Street. Wille stated that the loan was considered to be a “bridge” loan that would be replaced by permanent financing subject to approval of the Minnesota Community Capital Fund (MCCF) and Community Reinvestment Fund (CRF). MCCF provided their approval in early January but the CRF denied the application. The loan was extended until June 18, 2006.

Wille indicated that MS & GS Enterprises, Inc. is seeking to refinance the debt on the building. The owner is attempting to access a portion of the equity invested in the building to allow Steele to take advantage of a one-time opportunity to obtain a controlling interest in Techni-Pac. Wille added that additional equity would be reinvested in the Saint Peter building through construction of a parking lot accessed from Swift Street.

Wille stated that Trevor Brovold is currently updating the appraisal for 907 Swift Street. He stated that the new appraisal is anticipated to approach $1.3M Wille said that the 2002 appraisal established a value assumed to be approximately $700,000.

A motion was made by Dumdei, seconded by Seitzer to introduce Resolution No. 2006-02 entitled, “Resolution Recommending The Subordination of City Held Mortgages For The Refinancing Of The MS & GS Enterprises, Inc. (Exceed Packaging) Debt”. All members voting aye, the Resolution was passed and adopted.

Meeting Time

Wille stated that it has been difficult to hold EDA meetings because of lack of a quorum. It was suggested that a survey be sent to EDA members asking what time and day works best for them.

Adjournment

There being no further business, a motion was made by Dumdei, seconded by Seitzer to adjourn. With all in favor, the meeting adjourned at 12:10 p.m.

CITY OF SAINT PETER, MINNESOTA

OFFICIAL PROCEEDINGS

MINUTES OF THE REGULAR MEETING ECONOMIC DEVELOPMENT AUTHORITY MEETING

Thursday, February 16, 2006

Pursuant and due call and notice thereof, the regular meeting of the Economic Development Authority (EDA) of the City of Saint Peter was conducted in the Governor’s Room of the Community Center at 12:00 p.m., February 16, 2006.

A quorum present acting President Sam Gault, Jr. called the meeting to order at 12:03 p.m. The following members were present: Sam Gault Jr., Paul Tanis, John Kvamme and Ken Eichmann. City staff present was Director of Community Development Rosten Wille.

Approval of Agenda

A motion was made by Tanis, seconded by Kvamme to approve the agenda as presented. All voting in favor, motion carried.

Election of Officers

A motion by Tanis to table the election of officers until the next regular EDA meeting. Seconded by Kvamme, all voting in favor the motion carried.

Oath of Office

New EDA member Ken Eichmann took the oath of office at this time.

Minutes

A motion was made by Tanis, seconded by Kvamme to approve the Minutes of December 22, 2005 as presented. With all members voting aye, the Minutes were approved.

Washington Terrace Speculative Homes – Change Order

Wille presented requested Change Order #1 from RK & T Construction. The contractor requested an allowance for heating the housing units which are under construction. Wille explained that the contractor applied for building permits on July 20, 2005. A “Notice to Proceed” was not given until October 5, 2005. It is opinion o f both Wille and Project Manager O’Dell that the expense is justified.

The contractor requests an allowance of $350 per home for the installation of a covering of the exposed foam insulation. Wille confirmed that this code requirement was not included in the original bid. Again, Wille and O’Dell recommend approval.

The contractor requests an allowance for excess excavation due to unforeseen soil conditions. Wille indicated that upon excavation, it was determined that the soils at the finished depth were not adequate and that additional excavation and fill was required.

A motion by Tanis, seconded by Kvamme to introduce Resolution No. 2006-01, “Resolution Accepting Change Order #1 Regarding The Construction Of Four Spec Homes Within Washington Terrace Subdivision”. With no further discussion, all voting in favor, motion carried.

2006 Speculative Home Construction

EDA members indicated that they would need more information before a decision would be made regarding the construction of additional speculative homes in 2006. Concerns were raised regarding the future economy and construction during possible inflationary periods. Wille will proceed with the preliminary planning and choosing house plans and potential sites for 2006 construction.

Johnson Hall RFP

Wille indicated that the RFP for the construction of a building to house the Johnson Hall chemical dependency treatment program is expected prior to April 3, 2006. Such a timeline would require an extension on the state’s lease of the former St. Peter hospital building. Motion by Tanis for the EDA to support an extension of the lease of the former St. Peter Hospital building if reasonable progress is made in the RFP process for the construction of a new Johnson Hall. Seconded by Gault. All EDA members indicated that an extension would be reasonable and that an extension would be appropriate if a new building is under construction. With no further discussion, all voting in favor, motion carried.

Reports

Wille reported on the 805 Bassford Street site corrections, Regional Economic Development Enterprise Network Systems project, Highway 169 median planning, and various potential development projects.

There was discussion regarding the closing of the Saint Peter Cinema 5. Wille and Tanis will attend a meeting next week with a potential buyer of the theater. Wille and City Administrator Prafke are attempting to work with the other mortgage holder to provide for a change in theater ownership and will continue to meet with potential operators/owners.

Adjournment

There being no further business, a motion was made by Tanis, seconded by Gault to adjourn. With all in favor, the meeting adjourned at 12:54 p.m.