A meeting of the Redevelopment Authority of the City of Kaukauna was called to order at 3:30 p.m. on Tuesday, September 11, 2018, by Vice-Chairman VanderWyst.
Members Present: Feldt, Landreman, McGinnis, Smith, VanderWyst.
Also Present: Planning Director Jakel, Applicants.
Absent and Excused: Haak, Natrop.
Minutes. A motion to approve the minutes of the July 27, 2018, meeting was made by Landreman, seconded by Feldt. All members voted aye. Motion carried.
Loan Request – Little Food Company (Amanda Santoro). Ms. Santoro explained that she is a registered nurse and a mother of four. Her line of organic baby food was sold at the Appleton Farmer’s Market and is now available in four grocery stores. She is looking to move to a private commercial kitchen from her current shared facility. Conventional financing is through CAP Services – a $60,000 loan and a $10,000 line of credit. The applicants have paid approximately $17,000 toward start-up costs. Mr. Jakel explained that RACK could provide up to 50% of the total project cost towards acquisition or the purchase of equipment – in this case, $37,500. A request was made to defer payments or offer an interest-only option during start-up. Mr. Jakel explained that arrangements to defer payments until a revenue stream is established can be worked out. Mr. Jakel recommended a first position on equipment and personal guarantees as collateral. Ms. Smith asked for clarification on the tier projections. Ms. Santoro explained that they are based on anticipated geographical growth. The product is currently all raw fruits and vegetables with some grains that is blended and frozen however a transition is planned to a method that would extend shelf-life. The space on Second Street will work as the business continues to grow. Mr. Jakel asked about the ages of children that would use the product. Ms. Santoro explained that the smooth puree would be for children ages 4 to 18 months, chunky and finger foods would be added to the line for toddlers with the potential for other markets in the future. Mr. Jakel asked if the space would be for production or retail. Ms. Santoro explained that the rear of the space will have a closed kitchen with product space and display freezers in the front entry. Mr. VanderWyst asked about projected employment. Ms. Santoro explained that she currently works part-time as a nurse in addition to this project and anticipated hiring production, sales, and marketing staff.
Executive Session – Little Food Company (Amanda Santoro). A motion to adjourn to Executive Session at 3:45 p.m. pursuant to Wisconsin State Statute 19.85(1)(e) to discuss the loan request was made by McGinnis, seconded by Smith. All members voted aye. Motion carried.
Open Session – Little Food Company (Amanda Santoro). A motion to return to Open Session at 3:55 p.m. was made by Feldt, seconded by Landreman. All members voted aye. Motion carried. A motion to approve the loan request of $37,500 at 2% for five years with arrangements to defer payments to be determined, contingent on a first positon on equipment and personal guarantees from the applicants was made by Feldt, seconded McGinnis. All members voted aye. Motion carried.
Loan Request – Whitehead Martial Arts (Robert Whitehead/Shari George). Mr. Whitehead explained that he is a retired police officer and is one of 40 individuals with his martial arts rank. In addition to martial arts instruction, he offers women’s self-defense classes, active-shooter training, college-bound readiness training, and firearms training. They plan to take advantage of the Second Street location near Hydro Park and the recreation trail. Conventional financing is through Fox Communities Credit Union. Mr. Whitehead and Ms. George would be the only employees initially and the landlord would need approximately six weeks to complete the build-out of approximately 2,000 square feet. Mr. Whitehead explained that their focus is promoting everyday safety and awareness. Mr. VanderWyst asked about potential numbers of students. Mr. Whitehead explained that they can accommodate as many as 30 students. Ms. George explained that there is an additional smaller space off the main floor that can be used for individual training.
Executive Session – Whitehead Martial Arts (Robert Whitehead/Shari George). A motion to adjourn to Executive Session at 4:10 p.m. pursuant to Wisconsin State Statute 19.85(1)(e) to discuss the loan request was made by McGinnis, seconded by Feldt. All members voted aye. Motion carried.
Open Session – Whitehead Martial Arts (Robert Whitehead/Shari George). A motion to return to Open Session at 4:20 p.m. was made by Smith, seconded by Landreman. All members voted aye. Motion carried. A motion to approve the loan request of $12,000 at 2% for up to five years with a second position on equipment and personal guarantees from the applicants was made by Landreman, seconded McGinnis. All members voted aye. Motion carried.
Loan Request by State Farm Insurance. Mr. Jakel explained that the operator of the State Farm Insurance business on Plank Road is requesting RACK funding to donate towards sponsoring City events like LIVE from Hydro Park or the Farmer’s Market to promote name recognition for the business. Mr. Jakel anticipated that the loan would be secured by a position on a residential mortgage or personal guarantees. Mr. Feldt expressed his concern with the request and explained that there would be no jobs created as a result of the loan. The consensus of the Authority was to decline the request based on the lack of security, applicant equity, and the marketing use aspect.
Update on Proposed Changes to RACK Program. Mr. Jakel explained that aspects of the State’s intention to recall all RLF funds and close out the HUD program have been potentially amended to allow communities who received HUD funds prior to 1992 (we received our funds in 1984) that have not received additional funds, may be able to de-federalize their funds and keep their programs. If that was to occur, the Authority could disperse funds without restrictions which would substantially change our program. Mr. Jakel explained that the City did receive additional economic development grants over the years, however not for the RLF. Mr. Jakel explained that staff is waiting on a final determination by the State. Ms. Smith explained that the changes could end up being a boost to our program as we may be one of a few communities offering funding programs.
There being no further business to be brought before the Authority, a motion to adjourn the meeting at 4:40 p.m. was made by Feldt, seconded by Smith. All members voted aye. Motion carried.
