09-09-1996 EDA MIN - Laserfiche WebLink

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EDA Meeting Minutes September 9,1996 Page 2 e tenants. A tour by the EDA Commissioners of the Columbia Heights incubator is planned for Tuesday, September 24, 1996. Private Property City staff is also working with a private property owner to lease 10.000 - 15.000 square feet of space to the EDA. Paul explained the focus of the EDA business incubator program is to lease inexpensive space for a minimum of two years. filling the space with start-up companies. It is projected that the start-up companies could sublease the space at a rate to cover the EDA's costs. Paul noted Harlan Jacobs is aware of approximately a dozen possible tenants at this time. If the rental rate did not cover the EDA lease, the EDA would be required to guarantee the operating costs to either the County or private property owner. Options for recovering costs were discussed such as obtaining shares in a business, or a loan that could be converted to stock at any time at a pre-negotiated price. ~ Paul outlined the EDA' s responsibilities in the business incubator project, as follows: . e . Guarantee coverage of operating costs including taxes . Responsibility for leasing and managing the facility . Show on-going creation of 15-25 jobs . Provide technical expertise and services to tenants . Provide guaran1ees that growth of incubator businesses occurs within Elk River. or within Sherburne County, in the case of leasing the former administration building Square foot costs and projected expenses for a business incubator project were reviewed, as detailed in staff's memo to the EDA; Scenario A being the former administration building and Scenario B. a 10-15.000 square foot private property facility . 3 major issues associated with the business incubator program are under consideration by the city's legal counsel, Dave Sei:ergren, including a master lease between the EDA and property owner, sub-lease between the EDA and tenants, and a management contract between the EDA and Genesis Business Centers. In addition, Paul noted that business incubator program guidelines need to be established to identify the purpose and parameters of the program, the interview and selection process, and the types of businesses that would be allowed in the business incubator program. Discussion followed regarding tenants for a business incubator facility. Paul indicated one of the tenants in the Columbia Heights incubator is interested in relocating to Elk River. e Commissioner Dwyer indicated the County Board appeared receptive to the EDA's proposal to lease the former administration building. Paul felt the board might be agreeable to providing the same level of services they presently do, such as mowing, snow removal and garbage service.