5.0. EDSR 02-13-2006 - Laserfiche WebLink

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Discuss RDA Rosiness incabaWr Program February t3, 2006 Page 3 of 3 the above "Program Inception" section. The account's current cash balance of $133,095 will fund the annual estimated fmancial gap of the program under its current structure and vacancy fox approximately seven years. Issue Attached is a letter from Incubator building owner, Larry Hickman, indicating that he has sold the building. The current lease between the EDA and Mx. Hickman allowed fox an early expiration, which will take place on April 15, 2006. Therefore, it is appropriate for the EDA to discuss the future of the Incubator program. Incubator Consultant Recommendations Incubator consultant Harlan Jacobs has provided the attached recommendations regarding the future of the program. In summary, Mr. Jacobs' recommendations axe as follows: • There is little need for a facility to house pxogxam due to lack of available seed capital. • Once the ASCCF is ready to make investments, the EDA may consider finding a real estate developer/building owner/manager who would use a new ox existing building for an incubator pxogxam. • The EDA may consider continuing to market Elk River and maintain the existing retainer with Mr. Jacobs on a month-to-month basis for six months with asix-month renewal option. Staff recommendation Staff recommends that the EDA consider the following direction regarding the future of the Incubator Program: • Put the Incubator pxogxam on hold (after the lease expires in April) and direct staff to complete an analysis of the program and explore options fox a new Incubator pxogxam model, which may including the following: o New rent structure discontinuing the stock offering o New location located on city services o New building owner/partner o Discover new venture capital funds • Immediately discontinue marketing the program and the retainer with Incubator consultant until a new pxogxam model is secured. If an incubator is not feasible, explore the options of investing the Tescom loan fund balance into a new ox different economic development pxogxam.