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Council revisits business subsidy, city hall issues

February 26, 2014
By Deb Gau , Marshall Independent

MARSHALL - The Marshall City Council took action on several items related to ongoing city projects and business Tuesday night. During the council's regular meeting, council members and city staff revisited building issues at city hall and a new subsidy agreement for expansion of a Marshall business.

At Tuesday's meeting, council members held a public hearing on an updated business subsidy agreement with Action Manufacturing of Marshall. The company is seeking to build a bigger production facility to keep up with demand for its off-road motorized wheelchairs and had been approved for a subsidy agreement to build at new development space east of the Marshall airport.

However, at the council's last meeting, city staff said the original agreement couldn't be carried out. The Federal Aviation Administration and the MnDOT Aeronautics did not approve of leasing airpark space to a non-aviation related business.

At Tuesday's hearing, Marshall City Administrator Ben Martig said the city and the Marshall EDA sought to amend the subsidy agreement with Action Manufacturing. The new agreement would be for a transfer of property for seven acres of city-owned land in Marshall's industrial park. The transferred land is valued at $177,000, and the city would also waive about $460,000 in special assessments and about $9,000 in water area charges.

Martig said the subsidy agreement would also include a $240,000 loan from the Minnesota Investment Fund. The loan would have a 2 percent interest rate and a seven-year term.

Council member Glenn Bayerkohler had some of the same concerns about the proposed new subsidy as he had about the original version.

"It's a $646,000 subsidy," Bayerkohler said. "I do have a problem with the city picking winners and losers" among local businesses, he said. He asked if Action Manufacturing could be required to show proof that they could not secure private financing for their expansion. Martig said it hadn't been past city practice to require such proof.

In the end, a motion to approve the subsidy agreement passed 5-1, with Bayerkohler casting the vote against.

Later at the meeting, Martig presented a pair of recommendations from a building task force looking at conditions in the Marshall Municipal Building. After a series of meetings in the past few weeks, group members recommended the city enter a contract with local architectural and engineering firm TSP to conduct an updated building study of city hall. Martig said the study would include areas like a structural evaluation of the building's garage floor, an evaluation of the building's mechanical and electrical systems, design concepts for a possible remodel and preliminary cost estimates for both remodeling the current city hall and building a new one. Martig said the total fee for the study would be $14,000, which could be paid from $25,000 set aside from the city's general fund reserves.

However, Martig said the building committee also considered services from another company, Honeywell/Energy Services Group. The group recommended the council approve an engagement letter calling for a preliminary study of the municipal building's systems and energy efficiency and possible improvement and cost-saving measures. Martig said the preliminary study would be done at no cost to the city.

"We're looking at two studies that are similar, but they're different," said committee chairman John DeCramer. "We recommend that we move ahead with both."

Martig said there may be some overlap in the two studies but likely only in the evaluation of the building's mechanical and electrical systems.

Council members voted 5-1 in favor of approving the contract with TSP, with Jennie Hulsizer casting the vote against. The council voted unanimously to call for a letter of engagement with Honeywell/ESG.

 
 

 

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