Committee Minutes

Minutes of Grand Forks City Council/Growth Fund
Authority (JDA) - Monday, January 26, 2009 - 5:30 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 Monday, January 26, 2009 at the hour of 5:30 p.m. with Chairman Gershman presiding. Present at roll call were Council Members Bjerke, McNamara, Glassheim (teleconference), Christensen, Kreun, Gershman, Mayor Brown - 7; absent: Council Member Bakken - 1.

HOLD PUBLIC HEARING ON APPLICATION FROM
PHILADELPHIA MACARONI CO. ON REQUEST FOR
FUNDING

The staff report from director of urban development relating to Growth Fund application from Philadelphia Macaroni Co., with recommendation to hold public hearing on the requested funding and approve a loan of $122,841.06 to Philadelphia Macaroni Co.

Keith Lund, Grand Forks Regional Economic Development Corporation, reported that the project
is equipment expansion of Philadelphia Macaroni Company, the company was incorporated in 1914, producer and distributor of food service and retail pasta products, and constructed their original facility and began operations in Grand Forks in 1990 with 12 employees, they have undergone several facility and capacity expansions and now operate with 86 employees. They have realized significant sales and volume growth over last several years and now seek to improve local operations and diversify their product offerings by installing two silos and associated equipment to blend various grades and types of flour. Cost of the project is $1.5 million, with $1.2 financed through a commercial loan, Alerus Financial, and balance of the project will be financed through equity contribution by the company. Philadelphia Macaroni has requested local participation and are seeking a $122,841 PACE loan from the Grand Forks Growth Fund which will be matched by a $228,133.40 PACE grant from the Bank of North Dakota. Total PACE funds of nearly $351,000 will be used to reduce the company's interest on their Alerus Financial note, payment and interest will be deferred for 84 months and thereafter the note will carry the subsidized interest rate on the bank note and will be repaid in equal installments over the next 12 month period, the structure of the PACE loan is in compliance with your most recent PACE loan policy amendments, approved at October 13, 2008, meeting and the Growth Fund Committee considered the request at their January 20, 2009 meeting and recommended approval of the loan package.

Chairman Gershman opened the public hearing. There were no comments from the general public and Chairman Gershman closed the public hearing.

It was moved by Council Member Christensen and seconded by Mayor Brown to approve the recommendation and to approve the terms outlined in the staff report. Carried 6 votes affirmative, Council Member Bjerke voted against the motion.

ADJOURN

It was moved by Mayor Brown and seconded by Council Member Bjerke that we adjourn. Carried 7 votes affirmative.

Respectfully submitted: _____________________
Saroj Jerath, City Auditor