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ity of MEMORANDUM <br /> it/ <br /> R• <br /> iver TO: Economic Development Authority <br /> FROM: Pat Klaers - City A rator <br /> DATE: March 29, 1996 <br /> SUBJECT: Worksession Prior to EDA Meeting <br /> on April 8, 1996 <br /> Prior to the EDA meeting on April 8, 1996, I would like to get the Authority <br /> together for about 45 minutes to discuss some ongoing TIF proposals. One <br /> specific project that I need to have the EDA review is a proposal from Jerry <br /> McChesney to build a new facility on a lot in his industrial park which he <br /> already owns. No formal application has been received and, at this point, <br /> everything has been verbal between Jerry and myself. I have indicated to <br /> Jerry some of the concerns over the city providing land write down <br /> assistance for property which the applicant already owns. We also discussed <br /> the quality of the building and the fact that when assistance is provided, the <br /> EDA expects a higher than normal quality building being constructed. Other <br /> Sdiscussion topics included: the desire to assist local businesses and to treat <br /> businesses in a similar manner, the creation of new jobs, providing TIF for <br /> site preparation and improvements (landscaping, parking lot, utilities from <br /> the street to the building, etc.) along with the state required "but for" test. As <br /> everyone knows, assistance should not be provided by the EDA unless the <br /> project could not happen "but for" EDA assistance. <br /> I thought it would be best to discuss this project in a worksession without <br /> being on cable TV. In this manner, we can agree or disagree with some type <br /> of assistance without the comments being broadcast throughout the city. <br /> Staff is expecting another TIF application for the remaining vacant lot in the <br /> McChesney Industrial Park for Ron Blaha. Ron would be doing a project <br /> similar to Marketech, only it would be about 2/3 of the Marketech project. <br /> The project would be on one lot, 6,000 square feet and the building would be <br /> approximately $175,000. Accordingly, the total TIF assistance (using 15%) <br /> would be less than $30,000 or less than the purchase price of the land. <br /> Additional employees would be created with this project as Ron expects that <br /> the operation would work double shift, which would require new employees. <br /> Approximately 80% of Ron's business is with Tescom. A land write down <br /> "pay as you go" district is being discussed. To date, everything has been <br /> • verbal and nothing is in writing. <br /> 13065 Orono Parkway • P.O. Box 490 • Elk River, MN 55330 • (612) 441-7420 • Fax: (612) 441-7425 <br />