Committee Minutes

Minutes of Grand Forks City Council/Growth Fund
Authority (JDA) - Monday, July 21, 2008 - 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, July 21, 2008 at the hour of 5:30 p.m. with Vice Chairman Glassheim presiding. Present at roll call were Council Members Bjerke, McNamara, Glassheim, Christensen, Bakken, Kreun, Gershman, Mayor Brown - 8; absent: none.

HOLD PUBLIC HEARING ON FUNDING REQUEST FROM
GF TRUSS, INC.

The staff report from Urban Development director relating to Growth Fund application from GF Truss, Inc. with recommendation to hold public hearing on the funding request and approve a PACE loan of up to $6,500 to GF Truss, Inc.

Chairman Gershman opened the public hearing.

Keith Lund, Grand Forks Regional Economic Development Corporation, reported that the project
is Grand Forks Truss, a local company that produces residential and commercial trusses, the company was founded in 1991 by Stuart Johnson and manufactures its products out its manufacturing facility on North Washington Street, the company just completed a $450,000 automation expansion to install automated truss streaking and stacking equipment in August of last year and supported the expansion. The Company's employment grew from 15 to 32 as a result of that expansion. Due to increased demand and expanded market reach, GF Truss requires additional automation, the Company plans to purchase and install a fully automated component cutter which will allow for greater efficiency and productivity. The Company expects to further increase employment by 6 individuals as a result of this expansion, purchased price of the equipment is $125,000 and the Company has secured a loan through Bremer Bank to fully finance its acquisition and installation, and has requested PACE interest subsidy participati0on from the Growth Fund, local PACE participation has been provided in the form of a loan and the Growth Fund's PACE loan is projected to be $5,956 and this will leverage a PACE grant from the Bank of North Dakota in the amount of $11,061, combined PACE funds will be used to reduce interest on the commercial loan from 8.25% to 3.25% and if approved this evening the Growth Fund's investment will be deferred with no interest for the term of the underlying debt which is 5 years and will be paid back in 3 installments after the deferral period carrying an interest rate of 3.25%, debt will be secured by a subordinate use on the equipment and a personal guarantee from Mr. Johnson.

Council Member Christensen stated this is a prime example of why we need another industrial park, PS Doors started there and moved and built their second expansion and basically they need this from us because we have to act as a pass through entity so the Bank of North Dakota will give them reduced funding.

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

It was moved by Mayor Glassheim and seconded by Mayor Brown Member Bakken to approve the recommendation and to approve the terms outlined in the staff report. Carried 7 votes affirmative, Council Member Bjerke voted against the motion.

ADJOURN

It was moved by Mayor Glassheim and seconded by Mayor Brown that we adjourn. Carried 8 votes affirmative.

Respectfully submitted,



John M. Schmisek
City Auditor