The Crookston Housing and Economic Development Authority (CHEDA) met Tuesday morning at RiverView Health in Crookston. The committee opened the meeting by swearing in new board member Betty Arvidson and holding a public hearing on the five-year action plan for the Oak Court Apartments.
Following the public hearing, the board passed a resolution updating the five-year plan for Oak Court explained Executive Director Craig Hoiseth. “We had a hearing this morning and the board updated our five-year plan,” said Hoiseth. “Essentially what that is, is that concurrently with our plumbing project we’re going to try to rewire the building for cable and internet access bringing the technology up to date.”
Hoiseth also spoke with the CHEDA board along with the City Council members in attendance, including Mayor Guy Martin, Councilmen Steve Erickson, Jake Fee, Tom Vedbraaten, Dale Stainbrook, Don Cavalier, Clayton Brings and Bobby Baird, to clarify the TIF District’s scope and risk to the City. “Last week at the City Council meeting there was a TIF District approved,” said Hoiseth. “There still needs to be a developer’s plan that goes along with that TIF District. There have been some subsequent conversations about the size and scope of the TIF.”
Hoiseth said the TIF District doesn’t create any more risk to the city financially. “What it does is it compliments the developer’s ability to borrow more money from a primary lender,” said Hoiseth. “We want to make sure we provide the best opportunity for the developer to be a success overall with the project. It’s going to be hard for the developer to achieve the full tax increment even over 20 years, but we don’t handicap that developer either. I wanted to make sure that the board and council understood that the $200,000 over 20 years was available to the developer at the beginning and we want to make sure we keep that available throughout the project.”
All of the taxing entities – Polk County, City of Crookston, Crookston School District – will continue to collect the taxes on the properties current valuation explained Hoiseth. The additional taxes collected during the 20-year TIF District would be paid to the primary lender to pay down the debt service on the project. “What you have currently is a building that is substandard, not worth that much money and consequently not producing much in terms of property taxes,” said Hoiseth. “The TIF essentially allows the development to occur and any valuation increase on the property will be taxed but that tax revenue will be placed into the debt service rather than going to the county, school district or city allowing for the retirement of the debt quicker. Once we meet those thresholds all the tax revenue will flow into those taxing entities at that point.
The second resolution passed by the board was to sell 1609 Hoven Lane, the house partially completed by the construction trades class at Crookston High School, in its current incomplete condition. The sale included an agreement to cut the CHEDA developer’s fee and the Northwest Minnesota Housing Cooperative’s contractor fee by 50 percent. “We looked at the project and said the school worked one semester and we’re going to sell the building kind of at the halfway point,” said Hoiseth. “We decided that both the CHEDA developer’s fee and the contractor’s fee would be cut in half at that halfway point.”
The final resolution was to apply for a USDA grant for technical support on behalf of Epitome Energy for technical support. Hoiseth also updated the board on the ongoing childcare center discussions. “That’s an ongoing discussion we’ve been doing the last five or six meetings,” said Hoiseth. “I want to make sure the board stays informed as to where that conversation is going. A lot of media reports, a lot of people talking about it around town. I want to make sure the board is informed, get their questions answered. We’ve been looking at the Glenmore site. I’ve presented the mayor with the other sites that have been evaluated and we’re just doing our due diligence talking with childcare providers, Tri-Valley, all the stakeholders that are engaged with working toward a solution.”
Christine Anderson from the Small Business Development Center updated the board on how the first year has gone in Crookston. Anderson is currently providing a two-day marketing workshop, and working on future workshops on feasibility, succession planning, profit mastery, intro to business and business writing plans over the next several months. Tri-Valley CEO Jason Carlson informed the board that Tri-Valley will be partnering with Essu Financial who has an agreement with Credit Builders Alliance in developing a program that allows renters to improve their credit through payment of rent. And RiverView Health CEO Carrie Michalski, along with her staff provided board members and other meeting attendees with a tour of RiverView’s facilities and a presentation on the upcoming construction efforts on their campus.
