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M I N U T E S Port Authority Special Meeting Monday, July 1, 2014 4:30 P.M

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M I N U T E S Port Authority Special Meeting Monday, July 1, 2014 4:30 P.M M I N U T E S PORT AUTHORITY SPECIAL MEETING MONDAY, JULY 1, 2014 4:30 P.M. COUNCIL CHAMBERS – CITY HALL Members Present: Commissioners Jerry McCarthy, Jerry Mohrfeld, Michaell Bednar, Jeff Austin, Larry Maus, and Lee Bjorndal. Members Absent: Commissioner Roger Boughton. Staff Present: Port Authority Attorney David Hoversten and Port Authority Secretary Tom Dankert. Others Present: Jon Erichson (Turtle Creek Engineering and Consulting) and Austin Daily Herald. President McCarthy called the meeting to order at 4:30 pm. Item #2. – Approval of the minutes of the June 2, 2014 special meeting: Motion by Commissioner Bjorndal, seconded by Commissioner Maus, to approve the minutes of the June 2, 2014 Port Authority meeting. Carried 6-0. Item #3. – Claims for Payment: Mr. Dankert presented the claims for payment for the period of April 11, 2014 to June 19, 2014 for $347,706.36 discussing several items briefly. President McCarthy questioned the description for the snow removal at the Corporate Graphics building. Mr. Dankert noted that is how the billing comes on a statement (i.e. this is the former Corporate Graphics building). This is actually the Robinson Building. Commissioner Mohrfeld questioned when the Robinson Building ownership ends for the Port Authority. Mr. Dankert noted we are trying to schedule a document signing date, but June 30 appears to be the last day we will own the Robinson Building for all practical purposes. Motion by Commissioner Austin, seconded by Commissioner Bjorndal to approve the claims for payment as presented. Carried 6-0. Item #4. – Med City Mobility – request for exterior improvements: Mr. Erichson presented a request for exterior improvement funding for the new Med City building (former Drapery Services building) to make some minor improvements to the store front and west side access. Mr. Erichson stated the total cost of the project is $22,400 with 75%, or $16,800 coming in the form of easements/forgivable loans (in similar allocation percentages as prior Main Street Inc. loans). The owner would be required to come up with $5,600 of funds for their 25% share of the improvements. Motion by Commissioner Austin, seconded by Commissioner Maus to authorize the funding for the improvements for the Med City Mobility building as presented. Carried 6-0. Item #5. – Contract for Private Redevelopment – Hormel Foods Corporation for downtown fire site: Mr. Dankert discussed the proposed contract as presented noting this is the final piece for approval for the relocation of the SPAM Museum into downtown Austin. Mr. Erichson discussed sections 9.2 regarding the requirements the Port needs to do (demolish existing buildings, etc.) and also 9.3 for what the City is responsible for. The City of Austin will discuss this contract at the July 7 council work session. Commissioner Maus questioned Mr. Hoversten if his firm was satisfied with the document as presented. Mr. Hoversten stated Craig Byram in his office worked with staff at Hormel Foods Corporation and Mr. Erichson and Mr. Dankert to arrive at this final document. Motion by Commissioner Bjorndal, seconded by Commissioner Austin to approve the proposed contract for private redevelopment as presented. Carried 6-0. Item #6. – Hormel Institute – proposals for testing services: Mr. Erichson discussed the requirement of the bonding dollars to have an independent firm provide special inspection services and construction testing services of the Hormel Institute expansion. Mr. Erichson received two bids as follows: American Engineering and Testing, $39,975 McGhie and Betts, $42,148 Mr. Erichson recommended the low bid from American Engineering and Testing for $39,975, contingent upon approval by the State of Minnesota. Motion by Commissioner Austin, seconded by Commissioner Maus approve of the American Engineering and Testing bid for $39,975 contingent upon state approval. Carried 6-0. Item #7. – Hormel Institute Core and Shell Bid Approvals: Mr. Erichson discussed the bids that the Port Authority received for some of the work related to the expansion of the Hormel Institute. Mr. Erichson noted we did not get a bid for package 1D steel supply, so this will need to be re-bid. Additionally package 1E has a low bid from Hawk and Son’s Inc. that they have now stated has an error in it. Mr. Erichson is waiting for documentation on the error before discussion can start as to what we do with their bid (allow them to withdraw or go after their bid bond). Therefore these two items will not be approved tonight. Mr. Erichson stated all of the bids should be approved contingent upon state approval. Bid package 1A – Site work: Motion by Commissioner Austin, seconded by Commissioner Maus to approve the bid of $534,477 from Fraser Construction Company, contingent upon state approval. Carried 6-0. Bid package 1B – Concrete: Motion by Commissioner Mohrfeld, seconded by Commissioner Austin to approve the bid of $1,785,000 from Knutson Construction Services Rochester, Inc., contingent upon state approval. Carried 6-0. Bid package 1C – Masonry: Motion by Commissioner Austin, seconded by Commissioner Bednar to approve the bid of $208,800 from Darold Berger Masonry, Inc., contingent upon state approval. Carried 6-0. Bid package 1F – Exterior Envelope: Motion by Commissioner Maus, seconded by Commissioner Bjorndal to approve the bid of $1,198,681 from Merit Contracting Inc., contingent upon state approval. Carried 6-0. Bid package 1G – Conveying: Motion by Commissioner Bjorndal, seconded by Commissioner Austin to approve the bid of $104,654 from Schumacher Elevator Co., contingent upon state approval. Carried 6-0. 2 Bid package 1H – Existing conditions mechanical: Motion by Commissioner Austin, seconded by Commissioner Mohrfeld to approve the bid of $14,600 from DMC Plumbing and Heating Inc., contingent upon state approval. Carried 6-0. Bid package 1J – Existing conditions electrical: Motion by Commissioner Bednar, seconded by Commissioner Austin to approve the bid of $11,895 from Fox Electric Company, contingent upon state approval. Carried 6-0. Item #8. – Unaudited financial statements: Mr. Dankert discussed the unaudited financial statements for the five months ended May 31, 2014, as follows: Page 1 Combined Balance Sheet – Mr. Dankert noted we have over $1.2 million of cash. Additionally, we have $6,503,731 of long-term assets available (leases, notes, and loans receivable), plus a net book value of $1,078,641 for our fixed assets (buildings and construction in progress for the Hormel Institute expansion). Page 2 Combined Income Statement – We have $723,154 of net income for the five months, however this includes $175,000 of contributions towards the Downtown Revitalization process, all of which has not been spent. Additionally there are 511,844 of recorded contributions from the State of Minnesota/Hormel Foundation for the Hormel Institute expansion. Page 3-4 APC Debt Service Balance Sheet and Income Statement – This has been closed out with the note payoff by Bellisio Foods, Inc. Therefore there is zero balance on the Balance Sheet as all remaining cash was transferred ($299,382) to the Port Authority General Fund. Page 5-6 Hormel Institute Debt Service Balance Sheet – This fund will zero out fund balance wise (we won’t make any money or lose any money) at the end of the ten-year lease period. Page 7 Property Management Balance Sheet – We have $692,858 cash in the bank, $384,941 of which is dedicated to the Downtown Revitalization efforts. We are waiting for nearly $700,000 of reimbursements from the State of Minnesota/Hormel Foundation for costs related to the Hormel Institute expansion. Page 8 Property Management Income Statement – We have net income of $971,801 after the closing of the APC Debt Service Fund into this fund. Additionally, the Hormel Institute contributions noted above are creating net income. Page 9 Walker Building Balance Sheet – We have nearly $541,000 of cash in the bank and no outstanding debt against the building. Page 10 Walker Building Income Statement - $33,946 of lease revenues have come in, approximately $24,355 of costs, leaving the Port Authority with net income of $15,728. Page 11 Robinson Building Balance Sheet – This fund is still in the hole with cash by $39,731 but we expect ownership of this building to end officially on June 30. Motion by Commissioner Austin, seconded by Commissioner Mohrfeld to approve the unaudited financial statements for the period ending May 31, 2014. Carried 6-0. Item #9. – Other Business: President McCarthy questioned the status of the agreements with the State for the Hormel Institute expansion. Mr. Dankert noted the state has the lease and use agreements, but to date they have not finished their review. We have been in continual contact with them on this process and hope approvals will come soon. 3 Item #10. – Next meeting July 23, 2014 at 4:30 p.m.: This is for FYTI only and is the regular meeting. We expect to have some more approvals for the Hormel Institute expansion to bring forward. Item #11. Adjournment: With no further business, motion by Commissioner Bednar, seconded by Commissioner Austin to adjourn the meeting at 5:12 pm. Carried 6-0. Approved: President: Secretary: 4 .
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