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PROCEEDINGS OF THE CITY COUNCIL
OF THE CITY OF GRAND FORKS, NORTH DAKOTA
Friday, October 6, 1995

The city council of the city of Grand Forks, North Dakota met in special session at the Civic Auditorium on Friday, October 6, 1995 at the hour of 12:00 noon with Mayor Polovitz presiding, pursuant to call by Mayor Polovitz, which was served on all members on October 5, 1995: Document No. 6632 - Notice.

Present at roll call were Council Members Beach, Hoeppner, Hamerlik, Hanson, Glassheim, Carpenter, Sande, Babinchak, Geller - 9; absent: Council Members McCabe, Klave, Beyer, Johnson, Hagness - 5.

John O'Leary, Executive Director of Urban Development, reported that
the Grand Forks Region Economic Development Corporation has successfully marketed most of the land in the Industrial Park, and as result running out of land. He stated that several months ago they began negotiations with EDA for grant which might be available to acquire and expand the Industrial Park and provide infrastructures for the new property; that council authorized staff to submit $1,000,000 pre-application, which they did and as result have been invited in for full application; and is good sign they will be considered favorably for full grant. He reported that the council also had authorized City to obtain services of a private engineering firm to help with preliminary engineering and have been working with CPS, Ltd.; that they have option on land in Industrial Park which they are interested in purchasing, est. cost $1.6 Mil project, which includes acquisition of land and all infrastructure.

Mr. Weiland, CPS, reviewed series of exhibits, and noted that the Industrial Park is located south of DeMers, west of I-29 and north of 17th Ave.S., site they are looking at is just southwest of existing site near the Armory; exhibits included overall layout of existing park and proposed infrastructure, with estimated total cost of $1.251 Mil with contingencies.

Mr. O'Leary distributed copies of Memo summarizing the proposal; that based on Development Foundation's negotiations with the current property owners and estimates from Development's legal counsel, estimate total cost to acquire the 38 acres of land, including R/W and legal fees, at $355,500; est. A/E fees based on 10% of construction costs, at $108,064; construction cost $1,080,650; administration, $20,000, and Contingencies, $35,786, for a total of $1,600,000. He reviewed source of funding: EDA grant of $1,000,000, 1996 General Fund of $250,000 (budgeted to acquire land in Industrial Park), and $350,000 from Growth Fund. He stated that it is his, and Dick Olson's, suggestion that they not take full $350,00 out of Growth Fund; but prorate over period of time, with $150,000 this year, and ask that City consider lending the Jobs Development Authority $200,000, to be repaid in four consecutive equal payments starting in 1997 from sale of land in the Industrial Park, and that if the land is not sold, the Growth Fund would be used to service the debt. He also stated there are some options to reduce infrastructure. He stated that the City is sponsor of this application and are suggesting that the property might be owned by JDA/Growth Fund rather than Development Foundation and a lease agreement or contract be negotiated by the Growth Fund and Development Foundation to market property; holding company would be Growth Fund.

Mr. O'Leary stated they are asking the council and Job Development Authority for the following actions:

1) authorize the obligation of up to $350,000 to be used to buy and develop Phase 3 of the Industrial Park under terms as outlined.

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2) authorize proper city officials to negotiate an agreement between the City/JDA and the Development Foundation for the marketing and maintenance of the Phase 3 Industrial Park Expansion, and this matter would be referred to the urban development and finance committees.
3) authorize the City/Job Development Authority to develop a purchase agreement with the Development Foundation for the acquisition of Phase 3 Industrial Park expansion land.

Mr. O'Leary reported that they are asking that the council act on 1) to obligate up to $350,000 to purchase the land, and 3), that Item 2 doesn't necessarily need to be acted upon today.

Howard Swanson, city attorney, advised that today they are meeting as the city council, not meeting as the Jobs Development Authority; that if the City owns land they have legal obligations and procedure to follow in selling the land; however, if Jobs Development Authority owns the land, can convey land without going through public bidding requirement; but doesn't see that the Jobs Development Authority can authorize application or allocation of monies; that the council can authorize or obligate funds to enter into and authorize full application. He further stated that he would consider acquiring land in the name of the City, then council adopt ordinance allowing transfer of land to Jobs Development Authority. Mr. O'Leary reported that EDA doesn't care who owns the property, that the City will be the sponsor, and EDA needs to know if the $600,000 is available.

It was moved by Council Member Carpenter and seconded by Council Member Hanson to obligate up to $600,000 to be used to buy and develop Phase 3 of the Industrial Park as follows: $250,000 from the 1996 General Fund and $350,000 from the Growth Fund, with Growth Fund monies to be paid under the following terms: 1) that $150,000 be obligated from the 1995 budget, 2) that the JDA borrow $200,000 from the City with monies to be repaid in the years 1997, 1998, 1999 and 2000 from proceeds of the sale of the land; and 3) in the event the land is not sold, the Growth Fund would be used to service the debt; and further to authorize the City/JDA to develop a purchase agreement with the Development Foundation for the acquisition of Phase 3 Industrial Park expansion land.

Upon roll call the following voted "aye": Council Members Beach, Hoeppner, Hamerlik, Hanson, Glassheim, Carpenter, Sande, Babinchak, Geller - 9; voting "nay": none. Mayor Polovitz declared the motion carried.

Mayor Polovitz referred the matter of negotiating an agreement between the City/JDA and the Development Foundation for the marketing and maintenance of the Phase 3 Industrial Park expansion to the finance and urban development committees.

ADJOURN

It was moved by Council Member Hamerlik and seconded by Council Member Geller that we do now adjourn. Carried 9 votes affirmative.

Respectfully submitted,



John M. Schmisek
City Auditor

Approved:

Michael Polovitz, Mayor