7.0. EDSR 01-10-2005 - Laserfiche WebLink

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MEETING OF THE EDA FINANCE COMMITTEE • HELD AT THE ELK RIVER CITY HALL TUESDAY,JANUARY 4, 2005 Members Present: Cliff Lundberg,Tom McNair,Paul Motin,Dave Rymanowski,and Dan Tveite (arrived at 4:50 p.m.) Members Absent: Chris Carlson Staff Present: Assistant Director of Economic Development Heidi Steinmetz 1. Consider Micro Loan Extension Request: MN Fabrication&Machine.Inc. (MF&M) Ken Millslagle and Tom Berry of MF&M provided the Committee with a company update and reasons for the extension request. Tom McNair asked questions regarding future sales,if the company will continue to manufacture machine parts,the ownership status of the current facility, and if the company currently occupies the entire building. Mr.Milllslagle indicated that he expects sales to increase by$200,000 in 2005,which is the amount the company lost in 2004, that most of the machine parts manufactured by MF&M are being shipped overseas, that he,Don Millslagle,and Steve Dittbenner purchased the building,that the building is currently fully occupied by the company,and that the property includes two additional acres. • Cliff Lundberg inquired of the EDA's security on the loan. Heidi Steinmetz indicated that the EDA is in first position of the mortgage on the property. Mr.Lundberg mentioned that new loan documents would need to be drafted since typically the EDA is in second position. The Committee discussed whether the loan should be re-amortized at fifteen years or if the current amortization schedule should remain. Ms. Steinmetz indicated that loan extensions are typically re-amortized and the Committee agreed since the interest rate would be increasing due to the Micro Loan Policy requirement that the interest rate for loan extensions must increase to market rate. MOVED BY CLIFF LUNDBERG AND SECONDED BY TOM MCNAIR,THE FINANCE COMMITTEE RECOMMENDS THAT THE EDA CONSIDER A TWO-YEAR EXTENTION OF THE DECEMBER 2001$50,000 MICRO LOAN AWARDED TO MN FABRICATION& MACHINE, INC.WITH THE FOLLOWING TERMS: • INTEREST RATE OF 6.5% • MONTHLY PAYMENTS OF $400 THE MOTION CARRIED 5-0. 2. Discuss Micro Loan Portfolio Report Paul Motin asked about the"4440 Miscellaneous"line item in the amount of$50,000 listed on the December 28,2004 Micro Loan Fund Revenue/Expenditure Report. Ms. Steinmetz indicated that she believed it was the $50,000 Micro Loan awarded to Display Solutions in Spring of 2004 but that she would confirm that and get back to the Committee viae-mail.