The Spring Grove Economic Development Authority (EDA) reviewed a draft version of its 2016 annual report on Wednesday, March 1.

EDA President Howard Deters was unable to attend the meeting, so Mayor Sarah Schroeder guided the discussion.

The report was prepared and presented to the EDA by co-directors Courtney Bergey and Ryan Yetzer. The two are consultants with Community and Economic Development Associates (CEDA). The city has been working with CEDA since July 1, 2016.

According to the four-page report, “The partnership with CEDA has allowed the city of Spring Grove to move several community and economic development projects forward while building community engagement and positive momentum for new initiatives.”

Major accomplishments noted

Bergey and Yetzer’s report included three big-ticket activities achieved by the EDA last year.

First, was the completion of a $417,000 grant request to the Minnesota Department of Employment and Economic Development (DEED) for the sewer expansion project in the city’s industrial park.

Yetzer noted DEED is expected to announce its Business Development Public Infrastructure (BDPI) grants in July.

Meantime, Bergey added they’re working with Mike Bubany, the city’s financial advisor, on options for financing the sewer project. “We want to be ready when the grant announcement is made,” she said.

Another highpoint for the EDA was the retention of LaX Fabricating, the report states.

The EDA facilitated a county and city tax abatement process for the metal manufacturer located at 700 E. Main St.

As a result, the Spring Grove City Council approved a five-year tax abatement, which allowed LaX Fabricating to create nine new jobs and moved forward with building renovations.

The third and final item on the major accomplishments’ list was strategic marketing.

In 2016, the EDA launched a new outreach and marketing plan “to improve community relations and reach potential entrepreneurs and residents.”

Bergey also gave praise to a promotional program called the ‘Pretty Neat Small Town Story Series’.

“There are five writers from town who are working on these personal stories about Spring Grove,” she said. “We’ve set a March 15 deadline.”

The stories will be shared with the EDA, Bergey explained, before being incorporated into the city’s strategic marketing plan.

Project highlights identified

Under this heading, Bergey and Yetzer came up eight areas to feature in the annual report.

Bergey commended the EDA for its on-going work with Spring Grove Soda Pop. The historic bottling company is looking to build a new $1 million facility in the industrial park.

The report states, “(EDA) staff have secured projected tax valuation information and have had initial negotiations regarding land sale.”

The seven other project highlights are broader in nature, Bergey explained.

They include: community outreach and support, workforce development, the sewer extension initiative, marketing, downtown business district, business development and small business coaching.

Relating to the downtown business district, Bergey noted she and Yetzer are in the process of creating an inventory of commercial space in Spring Grove.

She called it a beneficial resource to assist the EDA in connecting potential business owners with potential locations to meet their specific needs.

Revolving loan fund rebounding

In the financial section of the report, Bergey pointed out there are six active loans – totaling more than $127,000 in outstanding payments.

She said the ultimate goal is for the EDA to collect all remaining principle of loans in default. That money, she explained, would be used to create new incentives and opportunities for Spring Grove businesses.

“We’re making progress,” Bergey stated, explaining the EDA has been able to move five of the six loans toward a more structured payment schedule.

Goals for 2017 announced

When it came to discussing the EDA’s goals for this year, Bergey said, “This can be a working document too. We can re-evaluate (it) throughout the year.”

Topping the list of goals is growing public awareness of the EDA, followed by business retention and development and the implementation of strategic marketing practices.

Relating to marketing, EDA member Craig Bender wondered if anyone is tracking traffic to the EDA’s website?

Bergey said that currently that is not being done; however, she agreed that website analytics would provide useful information for the EDA moving forward.

She said she would make that happen and hoped to have web-related data to present at the next meeting.

Back to the remaining five goals set for 2017, Bergey said they were general goals that involve work and projects well underway.

As listed in the report, they include: providing technical support to local businesses; facilitating the sewer expansion project; developing downtown commercial space inventory; managing the revolving loan fund; and supporting projects of community partners.

Next steps discussed

Mayor Schroeder asked EDA members to look over the draft annual report and suggest any comments, changes or additions to Bergey and Yetzer.

“They’re goals we’ve looked at before,” Schroeder added. “However, we should take more time to go over them.”

Yetzer said he would like the EDA to approve the annual report so it can be shared with the city council.

No formal action was taken by the EDA since members were directed to review the document and provide feedback.

Motocross lots in default

Bergey and Yetzer provided additional information regarding the five industrial park lots leased to Spring Grove Motocross (SGMX).

Bergey said the current three-year agreement with SGMX began in 2016 and continues through 2018.

At their February meeting, EDA members discussed a possible buy-out agreement, pending the sewer expansion project in the industrial park.

In recent discussions with Lisa Manske of SGMX, Bergey noted it was determined the organization is in default of its lease agreement as it does not have liability insurance.

“We need to make sure if they’re going to continue to be there that they get that liability insurance,” Bergey added.

“It’s too much of a liability for the city of Spring Grove,” Schroeder stressed to the board. “Because it is not a vacant lot, you have to have liability insurance on it.”

After much discussion the EDA unanimously approved a lengthy motion.

It includes a new lease offer to SGMX that would expire on Nov. 30, 2017. SGMX would be granted a rent-free season to assist in paying off debt and to immediately purchase the city-mandated liability insurance; proof of the insurance must be provided to the EDA.

Lastly, SGMX must return the property to its original condition by the time the proposed lease ends.

“If she’s (Manske) serious about continuing, she’ll come up with a plan,” member Lorilyn Dehning said regarding the motion.

Bergey and Yetzer told the EDA they would contact Manske and lay out the terms of the new lease offer and proceed accordingly, in consultation with the city attorney.

“If the city has to take possession again, it (the SGMX operation) has to be removed right now,” concluded Schroeder.

Fix-up application approved

The EDA approved a fix-up fund application for Spring Grove Auto Center, owned by J.C. Nerstad. The $2,500 award will be used to paint the exterior of Nerstad’s building and purchase new signage.

Yetzer said that leaves $7,500 in the matching grant program, which was created to help storeowners make improvements to their facades.

“The awards are issued on a first-come, first-served basis,” he explained, noting another application had been received; however, it was not fully completed.

The EDA decided not to act on that application until additional information was included.

Next meeting announced

The next regular meeting of the Spring Grove EDA will be at 7 p.m. on Wednesday, April 5, at 168 W. Main St.

Editor’s note: Brock Bergey is a new freelance writer for the Spring Grove Herald. He and Courtney Bergey are cousins.