03-10-2008 EDA MIN - Laserfiche WebLink

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Economic Development Authority Minutes March 10, 2008 Page 2 Districts at this time. Ms. Mehelich noted that after decertification, all local property taxes generated by these properties (estimated at $61,000 combined) will be distributed to the school, county and city in the same manner as all other property taxes. MOTION BY COMMISSIONER DWYER AND SECONDED BY COMMISSIONER FARBER TO APPROVE RESOLUTION 08-01, A RESOLUTION APPROVING THE DECERTIFICATION OF TAX INCREMENT FINANCING DISTRICT NO. 6 WITHIN DEVELOPMENT DISTRICT N0.1 IN THE CITY OF ELK RIVER. MOTION CARRIED 6-0. MOTION BY COMMISSIONER DWYER AND SECONDED BY COMMISSIONER MOTIN TO APPROVE RESOLUTION 08-02, A RESOLUTION APPROVING THE DECERTIFICATION OF TAX INCREMENT FINANCING DISTRICT NO.7 WITHIN THE DEVELOPMENT DISTRICT NO.1 IN THE CITY OF ELK RIVER. MOTION CARRIED 6-0. 6. Call Public Hearing for Disposition of EDA Property (Lot 4, Block 1 Northstar Business Park) for Sportech. Inc. Expansion Project Ms. Mehelich reviewed Sportech, Inc.'s proposed project to relocate their business in the Northstar Business Park. They are looking at an 80,000 square foot facility, which could be expanded up to 120,000 square feet. Spring 2008 constructed is proposed, with occupancy in the fall. Sportech is working with Amcon Construction on their project. They have indicated they will retain the existing 68-full time positions and create 25 new full-time jobs within 2 years of project completion. Ms. Mehelich explained that Sportech proposes purchasing Lot 4, Block 1 Northstar Business park for $1 and that the EDA would reimburse itself through city and county tax abatement revenues generated over the approximately 10-year period. Staff is working with Tom Bray of Briggs & Morgan to draft a purchase agreement for sale of the EDA property. Ms. Mehelich stated that the expansion project will involve finance participation from the company's lender and the following public financing applications: • City of Elk River Tax Abatement (land purchase) • Sherburne County Tax Abatement (land purchase) • EDA Micro Loan (equipment) • City application to the MN Dept. of Employment & Economic Development (DEED) for a MN Investment Fund loan (equipment) Ms. Mehelich explained that state statute requires a public hearing prior to the sale of property, review building plans and specs, and a reversion clause if the project is not completed as agreed. Therefore, the EDA is asked to call this hearing for April 14, 2008. She noted that all requests will be coordinated so that they can be reviewed for approval at one time. Commissioner Motin asked if the tax revenue over the 10-year projection amount was close to the $800,000 range, in order to fully recoup the land cost. Ms. Mehelich stated that the project costs have changed slightly and inflation rates need to be factored in. This will be part of the due diligence analysis when it comes back for final approval next month.