EDA - JANUARY

Date: 
January 26, 2017

 

CITY OF SAINT PETER, MINNESOTA
Economic Development Authority
REGULAR MEETING MINUTES – January 26, 2017
Saint Peter Community Center – Saint Peter Room

Call to Order:

The regular meeting of the Saint Peter Economic Development Authority (EDA) was called to order at 12:00 p.m. by Community Development Director Russ Wille.  EDA members Bob Southworth, Jay Hansen, Jerry Pfeifer, Marilyn Rundell, John Kvamme, and James Dunn were in attendance.  Members Jerry Pfeifer and Cory Abels were absent.  Community Development Director Wille and Administrative Secretary Cindy Moulton were also in attendance.

Agenda:

Motion by Rundell, seconded by Kvamme to approve the meeting agenda with the addition of the following Reports; Auto Repair, Old KFC, Four Seasons Mall, and Century 21-Atwood Realty.  All voting in favor, the agenda was approved as amended.

Election of Officers:

A motion was made by Kvamme, seconded by Hansen to nominate Southworth as President.  All members voting aye, the motion carried.  A motion was made by Rundell, seconded by Dunn to nominate Hansen as Vice President.  All members voting aye, the motion carried.  Wille explained that the Treasurer position is held by the City Finance Director and the Executive Secretary position by the City Administrator.   A motion was made by Dunn, seconded by Rundell to appoint the City Finance Director as Treasurer and the City Administrator as the Executive Secretary.  All members voting aye, the motion carried. 

Minutes:

Motion by Hansen, seconded by Kvamme to approve the Minutes of the November 23, 2016 meeting as presented.  All voting in favor, the Minutes were approved as presented.

Hospitality Lodging Study

Wille reported that Phase I of the Lodging Market Analysis has been completed by Patek Hospitality Consultants, Inc. of Sussex, Wisconsin.  Wille stated that the cost of the Phase 1 study was $3,000.   

Wille said the marketing study indicated that a Midscale limited-service hotel with 50 – 60 rooms would be appropriate for Saint Peter. A Midscale limited-service hotel would include such amenities as complimentary breakfast, sundry shop, indoor pool, fitness center, etc.

Wille indicated that Phase 2 of the study, which will cost an additional $3,000, would more aggressive.  Patek Hospitality would solicit hotels and offer potential sites for construction.

The St. Peter Development Corporation contributed $1,000 to the Phase I study.  Wille said he planned to contact them to inquire whether they wanted to participate in the Phase II Study.

Rest, LLC (Balloon Extension Request)

In 2012 the EDA approved a revolving loan to REST, LLC (Counseling Services of Southern Minnesota) in the amount of $140,000.  The loan was amortized over a twenty (20) year period with a balloon payment after five years.  The interest rate was established at 3%.  The loan was secured by a subordinate mortgage, promissory note and personal guarantees executed by the five principle owners and their spouses.

Wille stated that REST, LLC has submitted a request to extend their revolving loan balloon payment two years, until February 1, 2019.  Wille informed the EDA that he received correspondence from REST, LLC’s primary lender stating that REST, LLC is unable to honor the balloon payment as scheduled. 

Wille indicated that REST, LLC’s has made all of their payments on the date due.

Discussion was held and it was suggested that the interest rate be adjusted to the prime rate of 3.75%.

Wille noted that the financials of Counseling Services of Southern Minnesota suggest that the operations remain profitable.  The review of the personal financial statements of the 5 principle owners suggest that the personal guarantees are sufficient to collateralize the note.

A motion was made by Kvamme, seconded by Hansen to introduce Resolution No. 2017-01 entitled, “Resolution Recommending That The City Council Modify The Terms Of The Revolving Loan Previously Provided to Rest, LLC By Extending The Balloon Payment To February 1, 2019” with the following amendment “The interest rate shall be amended to reflect the prime rate (3.75%). Members Hansen, Dunn, Kvamme and Rundell voting aye, Member Southworth abstaining, the Resolution was passed and adopted.

Reports:

Speculative Home Development – Wille supplied a report on draws for the 3 spec homes.  A fourth draw has been submitted and is pending.  One of SWHMP spec homes has been sold. Two lots have been reserved.

The City is going to have a booth at the Home and Garden Show at the Verizon Center in March. 

There is not a commission offered to realtors for selling lots. 

Auto Repair – There is potential for a new auto repair shop coming to St. Peter.  The interested party is looking for property.

Old KFC – There is an analysis being completed on the old KFC building located on the south end of St. Peter.

Four Seasons MallThe HPC will be meeting on Tuesday, January 31, 2017 to review plans submitted for the façade of the 4 Season Mall property. 

Century 21 & Atwood Realty – Century 21 and Atwood Realty are renting space in the former Photo Shop (101 South Minnesota).

Old Shell Station - Wille announced the former Shell station on the north end of town will be coming up for sale by Nicollet County.

Adjourn:

With no further business before the EDA, a motion was made by Dunn, seconded by Hansen to adjourn.  The meeting adjourned at 12:35 p.m.