April 2, 2014 Albert Lea Post Authority Minutes

April 2, 2014

ALBERT LEA PORT AUTHORITY

MINUTES

APRIL 2, 2014

Albert Lea Business Development Center

 

1.     CALL TO ORDER & NOTATION OF ROLL

• The Regular Meeting of the Albert Lea Port Authority was called to order on Wednesday, April 2, 2014 at 7:30 a.m. by President Nancy Skophammer.  Roll was noted by the Board Secretary.
• COMMISSIONERS PRESENT:  Vern Rasmussen, Jr., Mike Moore, Nancy Skophammer and Al Brooks
• COMMISSIONERS ABSENT:  Ellen Kehr, Keith Fligge and Nate Jansen
• EX-OFFICIO MEMBERS PRESENT: Chad Adams, City of Albert Lea representative; Randy Kehr, business community representative; and John Kluever, Freeborn County representative
• EX-OFFICIO MEMBERS ABSENT:  None
• STAFF MEMBERS PRESENT:  Ryan Nolander, Executive Director and Julie Dandrea, Board Secretary
• STAFF MEMBERS ABSENT:  None
• GUESTS:  Kimberly Hillberg – CLA; Rebecca Gisel – Alliant Energy; Mike Murtaugh – Freeborn Mower Cooperative Services; ALBDC board members – Daniel Otten, Dick Kary and Steve Bowron; and Blandin committee members – John Katz and Saville Lord

(The audit review was moved ahead in the agenda.)

2.     AUDIT RESULTS

• Kimberley Hillberg with CliftonLarsonAllen reviewed the 2013 audit results.  They issued a clean financial opinion.   The findings were not uncommon.  They reviewed compliance according to state statute which was clean.  A land sale and an increase in rental income gave a cash increase and improvement to bottom line.  She suggested combining the real estate and general funds together because the real estate fund generates income and the general fund does not.  Or, more expenses could be reported in the real estate fund.  Commissioner Moore said there may be statutory limitations in combining the funds, especially in bonding.  Staff will look into it.    Commissioner Rasmussen made a motion to approve the 2013 Port Authority audit as submitted.  Commissioner Brooks seconded and the motion passed 4 in favor; 0 opposed.  (Kimberley left at this point.)

3.     APPROVAL OF MINUTES FROM MARCH 5, 2014 MEETING

• The minutes from the March 5, 2014 meeting were reviewed.  Commissioner Rasmussen made a motion to approve the minutes as presented, seconded by Commissioner Brooks.  President Skophammer asked for any discussion and hearing none, the motion carried 4 in favor; 0 opposed.

4.     AMEND RESOLUTION PA-14-08 PAYMENT OF CLAIMS

• The February claims were amended to show the ACH payment on the ALEDA spec building. It was posted late and would have shown up twice next month.  The monthly ACH payment has been approved annually since it didn’t show on the claims list previously, but now is listed monthly.  Going forward, there won’t be a need to do an annual resolution.  Commissioner Moore made a motion to accept the amended claims list as presented in the amount of $22,981.00 and to revise PA-14-08.  Commissioner Brooks seconded.  President Skophammer asked for any discussion and hearing none, the motion carried 4 in favor; 0 opposed.

5.     RESOLUTION PA-14-09 AUTHORIZING PAYMENT OF CLAIMS

• The claims were presented for review.  Commissioner Moore asked about the LMCIT claims.  Executive Director Nolander explained this was for property insurance for all our buildings which the Port piggybacks on the city’s policy through the League of MN Cities.  Commissioner Moore also asked if the billing from Kennedy and Graven law offices is complete.  They are still working on title clearance for the Enderes property and told staff they hoped to be done in 2-3 months.  Commissioner Moore made a motion to accept the claims as presented in the amount of $22,981.00, seconded by Commissioner Rasmussen.  President Skophammer asked for any discussion and hearing none, the motion carried 4 in favor; 0 opposed.

6.     RESOLUTION PA-14-10 CONFLICT OF INTEREST POLICY

• Executive Director Nolander noted the first three pages are the policy and the remainder is the conflict disclosure and gift disclosure which the board and staff will sign annually.  Commissioner Moore made a motion to adopt the conflict of interest policy and disclosures as presented and Commissioner Rasmussen seconded.   Commissioner Moore added the auditors made this recommendation when he met with them.  The motion passed 4, in favor; 0, opposed.

7.     BLANDIN GROUP ENTREPRENEUR DISCUSSION

(Randy Kehr left at this point 8:00).  Executive Director Nolander recognized members present from the ALBDC board:  Daniel Otten, Dick Kary, Steve Bowron, and Mike Moore.

The committee previously met with Ryan and also the Chamber board, who provided a resolution of support.  They would also like a resolution of support from the Port Authority.  Saville Lord presented a summary of the Blandin committee project:

• One of their ideas is to use the Marion Ross Center for a “shark tank” program and have entrepreneurs present their ideas to venture capitalists.
• There would be a follow-up in a class setting in six months for those who have gone through the shark tank program.
• They’re suggesting a biweekly or monthly program for entrepreneur networking where they can ask questions, discuss business issues, etc.
• Develop an incubator flex office space downtown.
• Continue to grow the micro-lending program.

The committee would like to try the ideas for six months of intense focus, wait a couple years and start again with a different focus each time.  The committee would like ALEDA to join in a facilitator role and John Katz with SMIF could be an additional resource.  The group would like to prepare a report so others can be aware of their project.  Resources for the project could come from funding from SMIF, a grant program from Blandin, and working with the high school and Riverland College.  When asked how a micro-lending program would be different than what ALEDA does now, they said they want to enhance the limited money in ALEDA’s loan programs.  Their idea is in the range of $10-15K for each loan.  Nolander added that’s about the amount of most of ALEDA’s loans.   With the “shark tank” program, the committee hopes to see a diversity of jobs over 24 months with 5 new businesses and 15 new jobs.  The six-month program is focused on 12 new businesses or up to maximum of 20 jobs.  Commissioner Rasmussen said he’s excited about the program since ALEDA has been working on entrepreneurship for a long time.  However, if the committee wants ALEDA to facilitate the program, he was concerned about stress on ALEDA staff time with having one less employee and asked what they foresee of ALEDA staff time.  Saville said they’re unsure at this point.  John Katz suggested SMIF funding could pay for a part-time person.  Executive Director Nolander feels an entrepreneur group should have someone within that heads it.  He added ALEDA did a business plan competition, but after the first year there weren’t viable candidates.  The Blandin committee doesn’t see it as an annual event, just a kick-off.

Daniel Otten liked the approach of an intense period.  He helped start the ALEDA’s business plan program, but said it ended up with more facilitators than participants.  He feels a catalyst is needed to get people to attend.  He raised a concern about already having a lot of service businesses now and do we want to start duplications of restaurants.  The committee believes by creating smaller jobs first to build a base, it will lead to bringing in bigger businesses.  Much discussion followed.  No action is required now. When the report is available, staff will share with the ALBDC members.  Commissioner Rasmussen made a motion to support the Blandin committee’s concept for the time being until we receive their report.  Commissioner Brooks seconded and the motion passed 4 in favor; 0 opposed.  (ALBDC board members, the Blandin committee and Chad Adams left.)

8.     EXECUTIVE DIRECTOR’S REPORT

Manufactured housing project update – A deal with Dick Rocklin was reached on leasing the Kleentec building and they are working with Lou-Rich for panels.  Staff has no response to emails sent regarding their loan request.  Mike Murtaugh said FMCS is working with them on a possible equipment loan.

Alliance Benefit Group update – This was discussed during the work session with the city council. ABG will be providing the City and ALEDA their pro forma on potential acquisitions in mid-April.

Upcoming lease negotiations:

• Zumbro River Brand wants to sign a long-term lease for the spec building.  They need humidity control for their product and received an estimate of $240K, which was excessive.  They may not need as high of level control as the estimate given.  Humidity control cost will be built into their lease.
• Carpenter approached staff last month ahead of their lease deadline. They asked for a 3-year and 5-year lease option; staff would like a 5-year lease.  Discussion followed about the different hats ALEDA staff wear and how it can be difficult being property managers negotiating leases while also being EDA staff focused on job and tax base creation.  They’re the longest term tenant and keep the building in great condition.  It was noted that ZRB would most likely occupy/buy the building if Carpenter ever vacated because of the proximity to their plant.
• Ventura took over their own warehousing of Ring containers and moved it into the middle space.  They need the space for another year.  The south space will be open when Larson vacates in May.

Recap of Port/City Council Work Session – Availability of labor is a major issue.  This led to discussion about language issues and getting people to move here or come back after post-secondary school.

JOBZ Audits – The report was handed out and reviewed.  Alamco and Select Foods showed less jobs at the end of the year.  Zumbro has added 10 more jobs since the report. Almost $54M has been invested from these contracts were signed.  The handout was mailed to the state with the reports.  Staff will send out a press release.

Business Retention visit recap:

• Edwards Manufacturing:  Randy Kehr and Ryan Nolander met with Doug Friend.  They continue to grow and try to be more efficient.  Doug is passionate about introducing training programs in schools earlier.  He and other manufacturers in town are willing to help fund programs to get them going.
• Interstate Packaging: They’ve joined with other box companies to have their own corrugator.  They reported experiencing high employee turnover.
• Innovance:  They met with Steve Tufte, who said 2013 was one of their best years ever.  Referral bonuses are given to employees who recruit new employees.  They also offer a sign-on bonus for experienced CNC operators and engineers.  They are continuing to look at ways to grow their business through other compatible business lines.

9.     EX-OFFICIO UPDATE

Freeborn County – John Kluever, Freeborn County Representative

• The county has approved $4.5m in construction projects.  County Road 101 and an insufficient bridge will be repaired next year.
• They are working on a welcome center to be housed in a vacant office.  People fluent in other languages would be available at different times and their groups could come in during their hours to talk about issues.  There are language barrier issues in the courts, license center, DHS, WIC, and housing.  A DHS person could also be available when a translator is there. When asked how many languages there are locally, Kluever estimated a dozen.  They have 40 different translators, using some from Rochester.  Some translating can be done over the phone, others have to be physically there which causes expenses to rise.
• Valuation statements went out with the real estate taxes.  Ag land will be 10-15% higher, down from 30% higher on the previous statement.
• FEMA changed the map in the Hollandale area causing many homes to be in the flood zone.  The County worked on an appeal and FEMA recognized their error and revised the map. Grant funds are available to buy out the few homes that are still included in zone.
• The County settled with the final labor union through 2013.

City of Albert Lea – Commissioner Rasmussen, on behalf of the City of Albert Lea

• Freeborn Bank – They are negotiating a purchase agreement and development agreement. A possible public hearing for the sale of the buildings could be on the 5/27/14 City Council meeting.  The Developer is proposing the top three floors as residential apartments and the first floor as occupied tenant to use space and take reservations for events
• Market Rate Rental Housing – The City is negotiating a possible sale of 5 acres near the City Arena.  There’s a rezoning request for development on the NW quadrant of W. 9th St. and TH 69 3. A possible third development is being discussed at the Development Review Team this morning.
• Housing Study – The HRA is soliciting proposals; completion is expected this summer.
• St. John’s Project – Meetings are being held this week on final land use approvals and development agreement terms.  A possible review by the Planning Commission will be in May.
• Community Center – There is a group of community stakeholders touring facilities and applying for funds to conduct a feasibility study on the Blazing Star Landing or other sites.

Chamber of Commerce – No report given.

10.  COMMISSIONER ITEMS

• Commissioner Brooks thanked the board for the flowers at his dad’s memorial service.

11.  ADJOURNMENT

• Commissioner Moore made a motion to adjourn the meeting, seconded by Commissioner Brooks.  The motion carried 4 in favor; 0 opposed.  The meeting adjourned at 9:15 a.m.

 

Filed and attested April 2, 2014.