The Crookston Housing and Economic Development Authority (CHEDA) met at the Valley Technology Park on Tuesday morning and approved moving forward with the mixed-use building in downtown Crookston, thus handing the reigns over to the City of Crookston to discuss if they want to help the funding. The board also approved the 2019 audit report, Prairie Skyline loan request, and had had good news on the reception of a $99,000 loan for the revolving loan program.
MIXED-USED BUILDING –
The CHEDA board discussed Community Contractors proposed mixed-use building on Fletcher and Ash Street and elected to move it to the Crookston City Council to make a decision if they want to move forward with the project. The developers are requesting the city give them a 20-year Tax Increment Financing district, give up the public parking lot (across from Trinity Lutheran Church), and build the downtown square at a projected cost of around $1 million.
The city would also have 7,700 to 7,800 square feet on the lower level to lease out for seven years. The building would include 39 apartments with a heated garage underground.
The board approved handing over the project to the City of Crookston to see if they want to move forward with the project. “The mixed-used building is something we have been working on for the past year and a half, close to two years,” said CHEDA Executive Director Craig Hoiseth. “We are trying to get a development in downtown Crookston with apartment living, kind of higher-end with retail space to go alongside a new downtown square and we are going to pass it on to the city for further discussion.” Crookston Mayor Dale Stainbrook said they would like to get public input on the project. Hoiseth said they talked to business owners in the area and they were concerned about parking and when Tri-Valley Opportunity Council moves to the Fournet Building they would like to see a parking lot there.
PRAIRIE SKYLINE FOUNDATION LOAN-
Kay Hegge of the Prairie Skyline Foundation spoke to the board for about 50 minutes about the Cathedral Church restoration project because she was requesting $75,000 for a loan.
The Prairie Skyline Foundation has received a $206,608 Minnesota Historical and Cultural Heritage Grant to help fix the roof of the old Cathedral Church on Ash Street in Crookston. Hegge’s $75,000 loan request was necessary to cover the costs until the grant money came from the state, which should happen after they reach certain milestones in the roof project. “The grant itself is dispersed by milestones being reached,” said Hoiseth. “As the certain milestones are reached someone will come in to inspect it before the funds are released so there is kind of a cash flow problem.”
Heggie was asked if the structure was solid and foundation board member Clayton Briggs said the footing is solid, the pillars are intact and the new roof has been reconstructed with I-beams and a rubber roof while the floor and exterior foundation walls will need some work. Hegge also stated they hauled out over 90 tons of pigeon manure out of the building.
Heggie said the work was supposed to be completed by February 1, 2020, but the foundation received an extension to December 1, 2020.
The foundation has a $27,000 passed due bill and will need another $20,000 soon for a total of $47,000. Heggie said she would give a personal guarantee on the $75,000 loan and when asked if the foundation board would give a personal guarantee, she added that wasn’t possible and she would be the only one as part of the guarantee.
Several board members had to leave because of the lengthy presentation, but four board members were left to vote, and they approved giving the Prairie Skyline Foundation a line of credit loan of $47,000 with the loan possibly going as high as $75,000. The board approved the motion with Steve Erickson voting no, saying they didn’t have enough information and a solid plan moving forward. “The board provided a loan in the form of a line of credit that would be guaranteed with collateral by the State of Minnesota as they receive their grant funds so the board gave me the approval to move forward with the line of credit,” said Hoiseth. “We will be doing that in the next few weeks to allow the project to secure the roof of the building, further stopping any deterioration of the building as they look for more funding.”
CHEDA Board member and Crookston City Council member Steve Erickson asked what the plan for the Cathedral Church building is. Hegge said they will be asking for $1 million from the city in the form of bonding. Erickson also made mention at the end of the meeting that future presentations have to be limited to 15 minutes because several board members had to leave for work because it took to long.
2019 AUDIT-
The board approved the 2019 audit conducted by Brady Martz and Associates and it compliments the City of Crookston audit. Board member Craig Morgan said he wasn’t sure where the “rumor” of CHEDA not being transparent came from as they get an audit every year and Hoiseth added that anybody wanting to see the audit can stop by the office and view it. “Every year we get audited and it came in with a very nice report,” said Hoiseth. “That audit is available and we want to make sure we keep the expenditures of CHEDA out in front of people.”
2021 STIPEND FROM THE CITY –
The CHEDA board approved asking for the same $155,000 stipend from the City of Crookston in 2021. $15,000 of the $155,000 would include funding from the Small Business Development Center. “The City only finances CHEDA about seven or eight percent of our total budget and the money goes towards economic development,” said Hoiseth. “We think we have a budget that was kept in line, we’re not asking for any increases.”
COMMUNITY INVESTMENT FUNDS –
CHEDA applied for a USDA Rural Business Development matching grant using $101,000 in community investment funds and received a $99,000 grant with all $200,000 going towards the revolving loan program. The CHEDA board strength and experience was a big factor in the grant award. “The city provided us some funds and we appropriated up to $101,000 in those funds as leverage and we are happy to report we were successful in obtaining the grant,” said Hoiseth. “We will have a $200,000 new revolving loan fund and we look forward to helping businesses with those funds.”
CONSTRUCTION TRADES CLASS –
The house on Hoven Lane hasn’t been completed yet because the Crookston High School Construction Trades class wasn’t able to work on the house after school was closed in late March. Hoiseth suggested if there is class this fall they will have the kids finish the house, which could be in November. Hoiseth asked his board what they would want to do after November. He suggested looking at a blighted house they could possibly buy and fix up/remodel and it would be a good learning experience for the kids, and good for the city to fix up a house. The board approved moving forward with the plan. “We had a good discussion today about acquiring a house that would be blighted in a neighborhood and try to repurpose that and get the neighborhood spruced up with a rehab project,” said Hoiseth. “Everybody seems to think it is a good idea and get the students some real-life experience.”
COFE LIQUIDATION-
There are three parties, all from out of town, looking at buying some of the equipment from Cofe. The total valuation of all equipment, tables, chairs, and décor is $38,000. Board member Craig Morgan said to set a deadline of 90 days to sell the items so the owner of the building could look at filling it with another business. “We have had three interested parties looking at buying the equipment, unfortunately, none of them want to establish a coffee shop in Crookston,” said Hoiseth. “We would like to sell all the assets in one group and so far none of the parties have been interested in taking all of it. There has been interest in the equipment, but we might have to go in the direction of a commissioned sale.”
