09-12-1994 EDA MIN - Laserfiche WebLink

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EDA Minutes September 12, 1994 Page 6 NOT TO EXCEED $3,900. COMMISSIONER FARBER SECONDED THE MOTION. THE MOTION CARRIED 7-0. 11. Consider a Micro Loan Request from Elk River Auto Mall L.L.C. Bill Rubin explained the EDA is in receipt of a request from Elk River Auto Mall L.L.C. (Limited Liability Company) for a $50,000 micro loan. The loan would be used to support the construction of a 16,000 square foot multi-tennant auto mall and an adjacent 5,000 square foot multi-tennant commercial retail building on the same parcel of land. He noted that the L.L.C. is comprised of Mr. John Weicht of John Weicht and Associates, Mr. Jim Rogness of J.R. Autotech Automotive, and Mr. Paul Vincent. Bill further explained that it is proposed that the land and construction costs will total $1,278,000. He stated that there will be two primary lenders financing approximately 70 percent of the project and applicant equity in the amount of $325,000. The proposed EDA loan of approximately $50,000 would represent roughly 4 percent of the total cost. Bill Rubin explained the letter of commitment from the primary lender(s) is not available at this time. Discussion following regarding the financing a project that will only be partially owner-occupied. Commissioner Duitsman stated he did not feel a need to finance a commercial project on raw land. President Gongoll noted that the EDA Finance Committee voted unanimously to approve the loan request by Elk River Auto Mall, contingent upon the participation of the primary lender. Commissioner Farber questioned what would happen if the parties were to default on the loan. Bill Rubin explained that the primary lender would be first in line to collect and the EDA would be second. He noted that the applicant must provide the EDA with a promissory note as well as a personal guarantee. COMMISSIONER HOLMGREN MOVED TO APPROVE THE MICRO LOAN REQUEST FROM ELK RIVER AUTO MALL LLC., CONTINGENT UPON THE RECOMMENDATION OF THE EDA FINANCE COMMITTEE THAT A LETTER OF COMMITMENT BE PROVIDED FROM THE PRIMARY LENDER. COMMISSIONER FARBER SECONDED THE MOTION. THE MOTION CARRIED 4-2-1. COMMISSIONERS DUITSMAN AND SCHEEL OPPOSED. COMMISSIONER DWYER ABSTAINED, AS THE BANK OF ELK RIVER IS ONE OF THE PRIMARY LENDERS FOR THE PROJECT. 12.1. Chanqe EDA Meetinq lime Bill Rubin explained the City Council's request to move the EDA meeting time from 7:00 p.m. to 6:00 p.m. , and also outlined several issues that need to be considered in making the change. Commissioner Duitsman stated thaT the City Council has become accustomed to meeting nearly every Monday night at 6:00 p.m. and that they would like to have the option of conducting business after the EDA meeting.