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HomeMy WebLinkAbout3.1a 2-14-2023 EDA Meeting Minutes CITY OF COTTAGE GROVE ECONOMIC DEVELOPMENT AUTHORITY ____________________________________________________________________ MINUTES Economic Development Authority (EDA) Meeting February 14, 2023 Pursuant to due call and notice thereof, a meeting of the Economic Development Authority was held on the 14th day of February, 2023, at 7:30 a.m. CALL TO ORDER The meeting was called to order at 7:30 a.m. by EDA President Bailey. ROLL CALL Assistant Mann called the roll: EDA President Bailey-Here; EDA Vice President Dennis-Here; EDA Member Carey-Here; EDA Member Krohn- Here; EDA Member Sandi Scott-Here; EDA Member Thiewes-Here. Members Present: Myron Bailey, EDA President Steve Dennis, EDA Vice President Chris Carey, EDA Member Joe Krohn, EDA Member Sandi Scott, EDA Member Eric Thiewes, EDA Member Members Absent: Dan Myers, EDA Member Staff Present: Jennifer Levitt, City Administrator Gretchen Larson, Economic Development Director Brenda Malinowski, Finance Director Jaime Mann, Assistant to the City Administrator Emily Schmitz, Interim Community Development Director Others Present: Ryan Zickel, NorthPoint Development APPROVAL OF MINUTES 3.1 Approval of December 13, 2022, EDA Meeting Minutes EDA Vice President Dennis made a motion to approve the December 13, 2022, EDA Meeting Minutes. Motion was seconded by EDA Member Carey. Motion passed unanimously (6-to-0 vote). BUSINESS ITEMS 4.1 Economic Development Update/Business Inquiry Gretchen Larson, Economic Development Director, reviewed the Beige Book Report: Labor Markets and Employment: Grew modestly since the last report. Price Pressures: Increased modestly since the previous report. Consumer spending: Grew modestly since the last report, but is still trending upward. Construction and Real Estate: Commercial construction fell slightly, as the pipeline for new projects is getting smaller. Industrial and multifamily construction is still okay overall, but rising interest rates are also slowing that a bit. Residential single-family construction continues to decline. Commercial real estate is relatively flat; office vacancies are still a challenge, despite little new construction. Manufacturing: Decreased slightly in this reporting period. Agriculture and Energy Sectors: Remained at high levels, and farm incomes and working capital remained strong. Minority and Women-Owned Business Enterprises: Slowed slightly since the last report, and are reporting lower profits. The food service business industries have been especially hit hard with hiring, against restaurant chains and more-established businesses. Project Updates: Hemingway Industrial Center: The footings and foundation have been completed for both buildings; on-site construction of the wall panels will resume in the Spring. Renewal by Andersen: The roof is complete, and the concrete slab is beginning to be installed. GTI - Leafline Labs: The addition is enclosed with trade work and interior walls underway. Pizza Ranch: Walls and roof framing are complete with plumbing and electrical underground work ongoing; owner estimates they’ll open in June, but they’re behind due to supply-chain issues. RJ Schinner: Opus Development has applied for a preliminary plat, called the Southeast Industrial Park 3rd Addition. It will consist of one industrial lot and one outlot that would be located to the south of the Soo Line Railroad, north of North Star Sheets, and east of Hamlet Park. A Site Plan Review of approximately 126,200 square-foot office and warehouse building, with an additional 80,000 square-foot future expansion area. 4.2 NorthPoint TIF Director Larson stated this is the First Amendment to the amended and restated contract for private development between the Cottage Grove EDA and NorthPoint. In December 2021, the EDA approved the TIF District. In May 2022, NorthPoint returned and asked for an amendment to that, which addressed Building 1A, which was added to the TIF; NorthPoint reported the challenges related to the construction of the roadway, so the EDA amended the TIF at that time. In December 2022, NorthPoint contacted City Administrator Levitt, told her once again they were facing challenges and asked for a change to the current TIF; leasing of the spaces in their current buildings was taking a little bit longer than they’d anticipated. They’re here today to ask for a restated and amended TIF; they’re asking the commencement date for the building of Phase II be changed from April 30 to October 31, 2023. We note that the square footage of the building and the completion date remain unchanged for that phase; the start date is the only change they’re requesting. Representatives for NorthPoint are here should you have any questions for them. EDA President Bailey asked NorthPoint representatives if they wished to speak. Economic Development Authority - Minutes February 14, 2023 Page 2 of 3 Ryan Zickel, Project Manager, NorthPoint Development, thanked the EDA and stated they appreciated their consideration for this Amendment. He noted they’re simply pushing out the commencement date and will be starting Building 3, the one south of the larger one, later this year. EDA President Bailey asked how their event went, as it looked like they had many people there. Manager Zickel replied it was wonderful, almost 70 people were there, and the brokerage teams really got some great insight and had traveled from all over. They felt it was a really successful event. EDA President Bailey thanked Manager Zickel for the update. Recommendation: By motion: Approve the First Amendment to the Amended and Restated Contract for Private Development by and between the Cottage Grove Economic Development Authority and NP BGO Cottage Grove Logistics Park, LLC. EDA Member Thiewes made a motion to approve the First Amendment to the Amended and Restated Contract for Private Development by and between the Cottage Grove Economic Development Authority and NP BGO Cottage Grove Logistics Park, LLC. Motion was seconded by EDA Member Scott. Motion passed unanimously (6-to-0 vote). 4.3 Ryan Companies Extension Assistant Mann stated we’re talking about the northeast corner of 100th Street and Jamaica Avenue South in the Industrial Park. Ryan Companies entered into a Purchase Agreement with the EDA in February 2022; they came back to the EDA in August 2022 due to some land issues, bedrock close to the surface and not a lot of soil on the site, so asked to extend their due diligence period to closing in March 2023. Now they’ve run into some economic challenges with financing, so they’re before us again to request a Second Amendment to the Purchase Agreement, requesting an additional six months of time on their closing date. Due to some uncontrolled circumstances, they’re now requesting a closing date of September 5, 2023. We’ve talked to representatives from WAG Farms Trust, they’re agreeable to the extension date, so we’re bringing it back before the EDA for review today. Assistant Mann stated the recommendations are before the EDA, but she’d be happy to answer any questions they might have. Recommendation: By motion: 1) Adopt Resolution 2023-001 consenting to the Second Amendment to the Purchase Agreement between WAG Farms and the EDA and the Second Amendment to the Purchase Agreement between the EDA and Ryan Companies US, Inc. 2) Authorize the EDA President and the City Administrator to execute the Second Amendment to the Purchase Agreement with WAG Farms to extend the Closing Date to September 5, 2023. 3) Authorize the EDA President and the City Administrator to execute the Second Amendment to the Purchase Agreement with Ryan Companies US, Inc. to extend the Closing Date to September 5, 2023. EDA President Bailey stated this seems to be a trend lately and it’s been interesting to watch with the interest rates. EDA Member Krohn made a motion to Adopt Resolution 2023-001 consenting to the Second Amendment to the Purchase Agreement between WAG Farms and the EDA and the Second Amendment to the Purchase Agreement between the EDA and Ryan Companies US, Inc. Motion was seconded by EDA Vice President Dennis. Motion passed unanimously (6-to-0 vote). EDA Member Scott made a motion to Authorize the EDA President and the City Administrator to execute the Second Amendment to the Purchase Agreement with WAG Farms to extend the Closing Date to September 5, 2023. Motion was seconded by EDA Member Thiewes. Motion passed unanimously (6-to-0 vote). EDA Member Carey made a motion to Authorize the EDA President and the City Administrator to execute the Second Amendment to the Purchase Agreement with Ryan Companies US, Inc. to extend the Closing Date to September 5, 2023. Motion was seconded by EDA Vice President Dennis. Motion passed unanimously (6-to-0 vote). PUBLIC HEARINGS - None. OTHER BUSINESS 6.1 EDA Calendar EDA President Bailey noted the EDA Calendar had been sent out to all EDA Members. 6.2 EDA Comments - None. 6.3 Response to Previous EDA Comments - None. 7 WORKSHOP - None. 8 PRESENTATION 8.1 Years of Service Presentation EDA President Bailey stated EDA Member Eric Thiewes is finishing out his term on the EDA, and he’s done a tremendous job over the last seven years; typically EDA terms are a total of six years. EDA Member Thiewes has served seven because of COVID, as during that time we were given the opportunity to extend service for an additional year. We’re now at the point where we can no longer extend his term, as much as we’d like to continue to have him on the EDA. EDA President Bailey read some things that EDA Member Thiewes had put together; we had a recent re-grand opening for Oasis Chiropractic, who has been in Cottage Grove for 20 years. He did a look back to see what has happened in Cottage Grove in 20 years, and Eric had noted that he joined the EDA back when Cottage Grove’s Home Depot site was vacant for several years and Rainbow Foods was really on its way out. That’s now where Hy- Vee, TJ Maxx, Home Goods, Planet Fitness, etc. are located. Eric wondered why we could not fill those open commercial spaces in a prime area of town, so he joined the EDA to learn more about how the City can get involved with redevelopment of those sites and learn about new companies coming to Cottage Grove. EDA President Bailey stated one of the best ways to find out what’s going on in Cottage Grove is to get involved and work with these developers to bring investments into our community. Eric had looked back at the thing that he’s most proud of, that he’d helped accomplish on the EDA, and it was the Home Depot-Rainbow Foods redevelopment. The EDA was able to purchase the Home Depot site, to help facilitate that change; that site was later purchased by Hy-Vee. Because of the City’s and the EDA’s involvement, that center is now fully leased; there were only a couple spots available, and Pacific Dental and Ulta are going in the final spaces. EDA President Bailey stated that he appreciated the fact that Eric has served on the EDA with us; he told Eric that there are other commissions that he might wish to consider serving on, and later on, if there’s another opening on the EDA, he’s welcome to rejoin us. He presented a plaque to Eric in appreciation for his dedicated service to the City of Cottage Grove’s Economic Development Authority, from 2016-2023. Eric stated he enjoying working on the EDA and always looked forward to the meetings. Everyone applauded and photos were taken. Eric stated he learned a lot being on the EDA, it’s nice to see the City staff, and you get to see a lot more of the behind the scene things. When you attend these Economic Development Authority - Minutes February 14, 2023 Page 3 of 3 meetings, you get to see the great work that the staff, the Council, and the various commissions are doing. It’s great to get involved with the City, and this is one of the best ways to do it. He appreciated the opportunity to be on the EDA, and he highly recommended it to anybody looking to do some volunteer work to join a City commission. EDA President Bailey stated he and EDA Vice President Dennis spoke about the new opening on the EDA with Eric leaving. If there’s somebody who’s interested and passionate about economic development or business development, go to the City’s website and fill out an application. EDA Vice President Dennis and I will be doing some interviews, hopefully in the near future. We will make the recommendation to the City Council for Eric’s replacement. EDA President Bailey thanked Eric again for his willingness to join and serve on the EDA. EDA Vice President Dennis told Eric it had been a real pleasure to have him here for all of these years, to have him be part of a team that’s brought a lot of success to the community. EDA President Bailey and he are both members of the City Council, and the Council is very appreciative of all of our volunteers; so, on behalf of the Council, he thanked Eric. 9 ADJOURNMENT EDA Member Thiewes made a motion to adjourn. Motion was seconded by EDA Member Scott. Motion passed unanimously (6-to-0 vote). Respectfully submitted, Jaime Mann Assistant to the City Administrator /jag