Committee Minutes

MINUTES/GROWTH FUND AUTHORITY (JDA)
Tuesday, January 19, 1999 - 7:15 p.m.

The city council of the city of Grand Forks sitting as the
Growth Fund Authority met in the council chambers in City Hall on Tuesday, January 19, 1999 at the hour of 7:15 p.m. with Chairman Carpenter presiding. Present at roll call were Council Members Brooks, Polovitz, Lucke, Hamerlik, Bouley, Carpenter, Beyer, Babinchak, Bakken, Hafner, Martinson - 11; absent: Council Members Glassheim, Lunak - 2.

HOLD MATTER OF BIODIGESTOR GROWTH FUND
APPLICATION

Chairman Carpenter reported that the Growth Fund subcommittee held this matter within committee.

CONSIDER MATTER OF VECTOR SYSTEMS APPLICATION

Chairman Carpenter read the recommendation from the Growth Fund subcommittee: The motion was made that the Growth Fund Committee recommend approval of financing contingent upon Vector Training Systems, Inc. securing additional financing as listed below: $300,000 from the North Dakota Economic Development Fund; $200,000 from a lender; $125,000 financing from private investors and either an additional $175,000 of private financing or proof of $175,000 equity from security sales; and $110,000 equity provided by the principals in the form of cash. The financing recommended to be approved contingent upon the above items is as follows: 1) A loan of $200,000 at 6% for seven (7) years to be used for working capital; and 2) $100,000 in equity to be purchased, at a rate based on the most recent stock transfer, to be negotiated by staff. The motion was made by Council Member Polovitz and seconded by Council Member Beyer.

Chairman Carpenter asked for comments relating to this matter.
There were no comments.

Upon call for the question and upon voice vote, the motion carried 11 votes affirmative.

APPROVE CHANGE ORDERS OR NOAH’S ARK

Chairman Carpenter asked Terry Hanson of Urban Development to present the change orders.


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Mr. Hanson presented four change orders for Noah’s Ark construc-tion as well as one contract letting. He reported that all change orders are to Innes Construction, the general contractor for the project:

C.O. #6, $5,577.00 to provide air conditioning to a computer room that is within the building and is utilized by Acme Elec-tric and it was determined after the equipment was up and running and that an individual who was occupying the space that the mechanical system that was supplied to the building was not adequate to control for that one room and is proposed to install an air conditioning system (stand alone system) into that one room.

C.O. #7, $766.00, is requested by the fire department and is for that same room so that room have sweeps on the doors and auto-matic door closures for fire proofing.

C.O. #8, $7,611.00, and is requested by the fire department, that there are 12 mechanical units on top of the roof of that building and there is a system in place that sets off an alarm if anyone of those malfunction or catches on fire, but doesn’t tell fire department when on a call which unit is causing the problem, and change order would call for a panel system that would indicate which unit is causing problem.

C.O. #9, $9,353.00, would be to install electric heating units within the duct work on the offices surrounding the exterior of the building. He stated they have had contact with Acme Electric and the outside offices are very cold, the heating system in place because of the location of the thermostats does not allow for the individual offices to receive heat that is needed to provide for comfortable work environment to the employees.

MAYOR OWENS REPORTED PRESENT

There was some discussion relative to C.O. #9, when system went in, if offices were planned to be there. Mr. Hanson reported that in past experience in order to obtain adequate mechanical facilities, heating and air-conditioning, to all the rooms within the building, is questionable sometimes on whether they do it right the first time, believed they looked at that problem but didn’t address adequately enough, because it is quite cold
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January 19, 1999 - Page 3

in those offices at floor level under the desks. Council Member Beyer stated that if the original contract expectations that were outlined were not met, would there be some recourse to go back and have the original heating contractor deal with this problem. Mr. Hanson stated that is true and they will be doing that but also feel that being in mid-January are asking for is authorization to go ahead to approve these changes and work with the contractors in determining what the problem was and why it wasn’t addressed initially, but now have to get heat to the offices so staff has comfortable environment.

Council Member Beyer stated she would like to make C.O. #9 con-tingent upon any negotiation with the original heating contrac-tor in the building and to approve up to these amounts for all the change orders but to negotiate with the original contrac-tors. Council Brooks seconded the motion.

Council Member Hamerlik asked what the expected extra cost with the electrical heaters that will be above and beyond the normal cost. Mr. Hanson stated they have not checked into that but all of those expenses are passed onto the tenants. Council Member Hamerlik stated that there is a responsibility with the original contractor, however, that might end there and we may have extra cost from now on. It was noted that of the first 5 change orders, several were quite substantial because this building is a designed built building, and started off with contract not knowing what the interior was going to consist of when the building was started. He stated that the original contract was just over $5 million and went up to $6.7 million for total cost.

COUNCIL MEMBER KLAVE REPORTED PRESENT

Mr. Hanson stated that with these change orders they are still within the initial approved budget that was submitted to EDA under this program.

Chairman Carpenter asked if there were any additional questions. There were no additional comments.

Upon call for the question, and upon voice vote, the motion carried 13 votes affirmative.

AWARD CONTRACT FOR WALL PARTITION FOR
NOAH’S ARK BUILDING
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Mr. Hanson reported that their largest tenant in Noah’s Ark, Acme Electric, Tool Crib of the North, has gone under lease for three additional bays of the building, increasing the occupancy by 33,000 ft. to roughly 90,000 sq.ft. of the building, and this construction project is to construct a wall at the end of the third bay to separate Acme Electric’s space from the other space that is there to make both areas more secure from the other parties. He reported they solicited bids, had three bidders, and lowest bid is from Circle K Builders for an amount of $12,846.98, and requested approval of award of the bid.

It was moved by Council Member Hamerlik and seconded by Council Member Babinchak to accept the bid of Circle K Buildings and award contract in the amount of $12,846.98.

Mr. Hanson reported that the proposed funding source would be the operating revenue from the building (rent from Acme).

Upon call for the question and upon voice vote, the motion carried 13 votes affirmative.

APPROVE APPOINTMENTS TO SELECTION COMMITTEE
FOR PROPERTY MANAGER FOR THE CORPORATE CENTER

Chairman Carpenter asked for concurrence in the appointment of Council Members Beyer and Bakken to serve on the Selection Committee for property manager for the Corporate Center. It was moved by Council Member Hafner and seconded by Council Member Babinchak that these appointments be approved. Carried 13 votes affirmative.

ADJOURN

It was moved by Council Member Brooks and seconded by Council Member Hamerlik that we do now adjourn. Carried 13 votes affirmative.

Respectfully submitted,



Saroj Jerath
Deputy City Auditor