Minutes - Economic Development Authority - 06/06/2013

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Member Skaff expressed concern about the financial viability of the company and where they will come up with the $300,000. He suggested the City request this information from the prospect. Member Riley stated the prospect's original proposal was that they had nothing in the project and that was unacceptable to him. He did not think the EDA had enough information at this time to make a recommendation, adding that scenario #1 is the only option he would consider. Member Hardin stated from his cursory review of the financials, he did not feel comfortable with the company's ability to service the debt in either scenario. He added he was open to looking at some kind of City participation but was not in favor of a full land write -down. He asked if the SBA portion could be increased under scenario #2. He also asked if there is equity in the prospect's existing building. Mr. Mulrooney stated the SBA 504 portion is limited to 40% of project costs under any scenario. He stated he did not know the agreed upon purchase price of the prospect's existing building and agreed to find out. He also agreed to find out the prospect's current liability on their building. Member Brunt agreed with the concerns expressed regarding a full land write -down and agreed that further investigation is in order before moving forward with a recommendation. Chairperson Steffen stated it appears the EDA is in agreement that scenario #2 should be taken off the table. He stated he would be okay with $191,000 and the land write -down. He added he was leery of approving this with two sources of City funds. He stated he would like to see the prospect come back with the source of funds for the $315,000 before going to the City Council. It was the consensus of the EDA to state that it was conceptually willing to consider a land write- down of $191,000. It was also the consensus of the EDA that it was not interested in a full land write -down on the property. It was also the consensus of the EDA to state that it was hesitant to provide a RLF for this prospect. It was also the consensus of the EDA that all of these items would require proof of owner equity and more detailed financial information. The EDA discussed the prospect's timeline and whether this item should proceed to the City Council or whether to wait for further information from the prospect. Member LeTourneau suggested it might be appropriate for staff to present the finalized application and responses to the EDA's questions to the EDA Chairperson and if the prospect has provided all the requested information and responded to all the questions, then it can move forward to the City Council as a recommendation from the EDA. Chairperson Steffen stated he was amenable to Member LeTourneau's suggestion. 4.03: Selection of the 2013 Ramsey Business of the Year Management Analyst Brama explained the EDA selects a Business of the Year that is presented at the annual business appreciation golf tournament, scheduled this year for Tuesday, August 20th. He indicated the 2012 Business of the Year was The Links at Northfork and the 2011 Economic Development Authority /June 6, 2013 Page 5 of 7