June 3, 2009 Albert Lea Post Authority Minutes

June 3, 2009

ALBERT LEA PORT AUTHORITY
MINUTES
Wednesday, June 3, 2009
7:30 a.m.
Albert Lea Business Development Center

 1) The Regular Meeting of the Albert Lea Port Authority was called to order on Wednesday, June 3, 2009 at 7:30 a.m. by President Ellen Kehr and roll was noted.

COMMISSIONERS PRESENT:  President, Ellen Kehr; Commissioners:  Al Brooks, Paul Field, Keith Fligge, Mike Moore, Vern Rasmussen Jr., and Nancy Skophammer (arrival 7:40 a.m.).

COMMISSIONERS ABSENT:  None.

EX-OFFICIO MEMBERS PRESENT:  Randy Kehr, Business Community representative; Chris Shoff, Freeborn County representative (arrival 7:40 a.m, excused at 8:50 a.m.); Victoria Simonsen, City of Albert Lea representative (arrival 8:15 a.m.).

EX-OFFICIO MEMBERS ABSENT:  None.

STAFF MEMBERS PRESENT:  Dan Dorman, Executive Director; Ryan Nolander, Assistant Director; Nanciana Jensen, Board Secretary.

STAFF MEMBERS ABSENT:  None

GUEST:  John Kluever, Freeborn County Administrator.

VISITOR:  Mike Lee.

2) APPROVAL OF MINUTES OF THE MAY 13, 2009 REGULAR MEETING.

The minutes of the May 13, 2009 meeting were reviewed.  Commissioner Rasmussen made a motion to accept the minutes as presented, seconded by Commissioner Fligge.  The motion carried with 6 in favor and 0 opposed.

3)       RESOLUTION PA-09-11  AUTHORIZING PAYMENT OF CLAIMS.

The claims were presented for review and discussion followed.  Commissioner Moore made a motion to approve Resolution PA-09-11 authorizing payment of claims in the amount of $10,288.92, seconded by Commissioner Field.  The motion carried with 7 in favor and 0 opposed.

Board members also discussed the time commitment and amount of funding the Board approved earlier last year in the hiring of Paul Sparks as an economic development resource.  The Board also discussed an extension of the time allotment for Paul Sparks in order to continue to utilize his expertise, but on an on-call basis.

4)       RESOLUTION PA-09-12  AUTHORIZING THE SALE AND ISSUANCE OF TAXABLE REVENUE BOND.

Executive Director Dorman reviewed the sale and issuance of the taxable revenue bonds for the construction of the new spec building in the ALEDA Industrial Park with the Board.  At the May meeting, the Port Authority Board determined that the offer by Farmers State Bank to purchase the Note was the most economical.  The Note will be issued in the amount of $1,800,000 and the proceeds of the Note will be used to finance the construction of the speculative building in the ALEDA Industrial Park.

a)  Statement of Conflict.

Because Port Authority Board Commissioner Nancy Skophammer is the President and CEO of Farmers State Bank, Director Dorman contacted the Port’s bond attorney to get clarification regarding possible State restrictions which might apply when a commissioner of a port authority is employed by a bank that is engaged in making loans to a port authority.  Pursuant to Minnesota Statutes, Section 471.88 subd. 11, “when a commissioner of a port authority is employed by a bank engaged in making loans involving real or personal property to such port authority, no restriction shall apply to any such loans made or trust services performed by said bank if the commissioner discloses the nature of such loans of which the commissioner has personal knowledge, which disclosure shall be entered upon the minutes of the port authority.”  The statement of conflict means you have to notify, but it does not preclude Commissioner Skophammer from voting, and legally there would be no problem.  Therefore, Commissioner Skophammer would be allowed to vote on Resolution PA-09-12.

Due to everything not yet being finalized for the bond issue, Resolution PA-09-12 will be placed on the agenda for the July 1^st meeting of the Albert Lea Port Authority for discussion and approval.

5) RING CAN LEASE PROPOSAL.

Executive Director Dorman discussed the current Ring Can lease which expires on 1/31/2010.  Ring Can has notified Director Dorman that they would like to reduce the amount of space they lease in our building in the South Industrial Park.  The Ring Can building encompasses 67,200 square feet, of which Ring Can currently leases 53,400 square feet, and the remaining 13,800 square feet of space is leased to Ventura Foods.  Currently Ring Can leases their space @ $2.20 per square foot triple net.

Ring Can proposed leasing only 19,200 feet of space starting August 1, 2009.  Director Dorman suggested a new lease in the amount of $3.18 per square foot triple net for five years for 19,200 feet of space.  Director Dorman wanted Board input regarding the lease rate, and the requested early out by Ring Can from their lease.  Discussion followed. Director Dorman informed the Board that if we enter into the new lease with Ring Can, we would have the availability of the remaining 34,200 feet of space, which would allow the Port Authority to have additional space available to lease.   If the new lease is put into place, a stipulation would be added stating that Ring Can would have the responsibility of putting the building back in place, i.e. they converted restrooms which we will need, into a break room.

A motion was made by Commissioner Moore stating that the Port Authority Board will agree to the early release of Ring Can from their current lease on the July 1, 2009 date or after, if Ring Can will agree to restore the building back into the shape it was originally (i.e. re-add restrooms, etc.).  The Port Authority would then lease the requested 19,200 square feet of space to Ring Can at a price of $3.18 per square foot triple net for a period of five years.  All other lease language would remain the same.  The motion was seconded by Commissioner Fligge.  The motion carried with 7 in favor and 0 opposed.

Ventura Foods, who leases 13,800 square feet of refrigerated located space in the Ring Can building from the Port Authority, contacted Director Dorman regarding a review of their lease which expires on August 1, 2009.  Directors Dorman and Nolander suggested a lease rate of $4.25 per square foot for a period of 3 years.  Ventura Foods would also like to have an option built into the lease which states that if Ventura would construct a new building in Albert Lea, comparable in size to the 13,800 square feet of space that they are currently leasing, they would be able to opt out of their lease.  Discussion followed.  It was the recommendation of the Board to increase the suggested lease rate to $4.50 per square foot for a period of 3 years.

Commissioner Fligge made a motion to extend the current lease for 13,800 feet of refrigerated space in the Ring Can building to Ventura Foods at a cost of $4.50 per square foot for a period of three years beginning August 1, 2009.  This motion also includes an ‘out’ of the lease for Ventura Foods if they decide to construct a new building in Albert Lea, comparable in size to the space they are currently leasing, within the 3 year lease period.  The motion was seconded by Commissioner Field.  The motion carried with 7 in favor and 0 opposed.

6) BRIDON CORDAGE REQUEST:

Executive Director Dorman informed the Board that officials of Bridon Cordage have made a formal request that the Port Authority participate in their building expansion.  They are requesting that the Albert Lea Port Authority construct and lease back to Bridon Cordage a 100,000 plus square foot addition.  The Port Authority would be required to publicly bid this project, and the ‘prevailing wage’ statutes would apply.  The Port Authority would also be required to accept the bid of the lowest qualified bidder.  Bridon is also asking for a 10 year “lease to own” financing package.  Bridon would be responsible for the cost to design and bid of the project.  Director Dorman said that if the project proceeds, the cost to Bridon’s to design and bid the project, could be built into the lease.  Board discussion followed.  The Board felt that this project would add jobs and anchor Bridon Cordage to Albert Lea.  President Kehr made a motion to proceed with the Bridon Cordage project to build a 100,000 plus square foot building on a lease to own basis, seconded by Commissioner Fligge.  The motion carried with 7 in favor and 0 opposed.

7) RETREAT.

July 1, 2009 has been scheduled as the retreat date for the ALEDA Board.  The ALBDC Board has been invited to participate in the retreat, which will be held at Wedgewood Cove.

8) EX-OFFICIO UPDATES.

Chris Shoff – Freeborn County Representative

• a) ICE Contract – Freeborn County has received the money from the Federal government for the ICE contract, and the County should be receiving prisoners within the next couple of weeks.
• b) I-90 is being fixed at this time, and repairs to County Road 46 will begin this summer.
• c) The County is waiting on the State for funding allocations.
• d) The County has signed an employee agreement for the Blue Zones.
• e) The Bent Tree Wind Farm project is going forward.

Victoria Simonsen  –  City of Albert Lea.

• a) Ms. Simonsen discussed the summer projects that have been approved by the City Council:
• § The airport stimulus funding has been received so that work can begin on the airport runway addition. The project has been awarded locally.
• § The new Plaza Street will soon be completed and reopen next week.
• § There are several neighborhood projects going on.
• § The City has been working with MnDot for federal stimulus dollars to fund the sidewalk and bike path projects.
• b) Blue Zones is in full swing. Wedgewood Cove will be hosting three Blue Zones workshops, the first one being June 9^th.
• § Ms. Simonsen will be meeting with 150 ambassadors this evening to try to get 5000 people involved in the Blue Zones project.
• § Ms. Simonsen had an interview with USA Today on the Blue Zones project. The article will appear in the newspaper on June 11^th.
• § C-Span’s traveling station is in Albert Lea this morning at the high school parking lot.
• c) Regarding the Sunset extension – The City has been working with Magellen Pipeline to gain easement.
• d) The LaFavre property (old country club property) was discussed by the Board. Concern was shared with Ms. Simonsen regarding mowing of the property and the wetland areas. Scott LaFavre currently has control of the wetlands.
• e) The City is still awaiting the governor’s announcement regarding State local government aid for Albert Lea before beginning to plan the budget for 2010.
• f) The State bonding bill for the removal of waste at Edgewater Park was discussed. Ms. Simonsen informed the Board that the City was able to get the language changed in order to use the balance of the bonding dollars to replace the park pavilion, add a playground and get sewer and water to that area. The balance that remains is approximately $300,000. The site where the removal of waste took place in the Park has been graded so that it is ready for future use.
• g) Blazing Star Landing – Ms. Simonsen informed the Board that the City got permission from the MPCA to remove a petroleum tank from the Blazing Star Landing site. This area was cleaned out and the tank moved to the landfill waste site. There are two more tanks which should be excavated, one an old wastewater tank and one more petroleum based tank. Ms. Simonsen said that the City is one step closer to making the Blazing Star Landing a clean site. She has noticed the water clarity of Fountain and Albert Lea Lakes has improved tremendously because of the waste removal at the Edgewater Park and Blazing Star Landing sites.

Randy Kehr – Chamber of Commerce.

• a) The Chamber has been involved in summit meetings for Riverland Community College.
• b) The Minnesota Chamber president will be in Albert Lea tomorrow to present a program “Strategies for Smart Giving”.
• c) The Chamber had a fabulous fireworks fundraiser. They raised over $16,000.
• d) There were six applications for the Pollad Grant for small businesses. The Chamber can send four to the State.
• e) Director Kehr reached out to Waste Systems this morning to see if the Chamber could assist them in any way after the fire.
• f) Director Kehr attended a Bent Tree Wind Farm meeting the other day. He informed the Board that much of what has been done in Franklin County will be done here in Freeborn County.
• g) On June 16^th, the Business After Hours will be held at Wedgewood Cove. Graduation for the participants of the Leadership Program will be held at that time.
• h) A street dance will be held on June 13^th following the car cruise on the Eddie Cochran weekend.

9) EXECUTIVE DIRECTOR’S REPORT.

• a) Cedar Valley Services has received a grant to build a bus garage and they have contacted the Port Authority to see if we might have land available. Director Dorman informed the Board that an acre on Lot 1 Block 1 in the new ALEDA South Industrial Park would be available for such a project. The lot has a storm water pond and the South half of the lot has a lot of fill, but the North half of the site is about an acre and would be usable for such a project. Director Dorman suggested that we could add landscaping to enhance the property as it is located at the entrance to the ALEDA Industrial Park. Board discussion followed. Director Dorman indicated that he did not foresee that the Port Authority would have use for this small lot. The Board suggested that we should retain an easement to the South part of the lot, and that we should control how the building is constructed, so that it has a comparable quality to our new Spec Building. Covenants could be put into the agreement for the 10,000 square foot building.
• b) Executive Director Dorman informed the Board that he has received several inquiries regarding land available in the Freeborn County area. He met with company representatives on Monday evening who are putting together an egg hatchery. The main hatchery could be located here in Albert Lea. The company would bring in fertilized eggs and once the eggs are hatched, the chicks would be placed in one of the eight egg facilities for egg production. This company liked the location of Albert Lea because it was located at the I-35 & I90 crossroads, but is also looking at other sites.
• c) Executive Director Dorman was invited to attend a meeting with the County Board, Steve Johnson and Mike Peterson. Johnson and Peterson would like to put in a facility which would make scrap wood into wood pellets for heating purposes. An area they were looking at is currently zoned agricultural. Executive Director Dorman suggested that the County & City think about rezoning the area for future building. If the company purchased that parcel of land at this time, they would need a conditional use zoning permit.
• d) Project Magnolia – Director Dorman said that the State says the project is now on hold.
• e) Merricks (Freeborn Foods) – Director Dorman informed the Board that Merricks is slowly moving forward with their plan to refurbish one of their dryers, so they can get their people back to work. The company has sent in an application for the City’s Revolving Loan Fund.
• f) Director Dorman received a $500 check from the coalition of Greater Minnesota Cities for his participation in the statewide tour regarding LGA. He informed the Board that he will be signing over the check to the Port Authority for deposit into the Port Authority account.

10) COMMISSIONER ITEMS.

• § Commissioner Fligge suggested that we use caution with the egg hatchery company regarding a possible odor.
• § Commissioner Fligge had a telephone discussion with John Roscoe of SAR. Mr. Roscoe informed him that he has had to lay off some employees, but that he still plans to build the additional building on his property sometime in the future.
• § Commissioner Rasmussen informed the Board that the City has awarded the contract for engineering on Myers Road.
• § President Kehr informed the Board that pretty much all construction contracts for this year have been awarded locally.
• § Director Randy Kehr informed the Board that Executive Director Dorman opened the Business Development Day meeting for the Leadership program members. He complimented Director Dorman on a ‘great start to the day’.

11) ADJOURNMENT.

Commissioner Moore made a motion to adjourn the meeting at 9:25 a.m., seconded by   Commissioner Fligge.  The motion carried with 7 to approve and 0 opposed.

Filed and attested June 3, 2009.

____________________________           __________________________
Ellen Kehr, President                            Nanciana Jensen, Board Secretary