Council discusses financial dealings
Published 12:00 am Friday, November 10, 2000
The Austin City Council’s agenda this week was dominated – two out of three items – by city financial dealings with two area companies, Cooperative Response Center and Hormel Foods Corp.
Friday, November 10, 2000
The Austin City Council’s agenda this week was dominated – two out of three items – by city financial dealings with two area companies, Cooperative Response Center and Hormel Foods Corp.
First on the agenda was a request to extend the time the Cooperative Response Center has to execute its part of the business subsidy contract with the city.
The council initially had given CRC 60 days to reach an agreement with all parties. CRC needed 30 more days – not to get any further funding, City Administrator Pat McGarvey reported – but to arrive at an acceptable cost for construction of a corporate headquarters.
The problem lies in arriving at a price and design for its new corporate headquarters. McGarvey said CRC anticipates an agreement with the building contractor within the next couple weeks, for a building that will cost around $1.5 million. CRC has secured a private loan for 75 percent or $1.5 million of its costs, plus two loans from the city of Austin ($225,000) and the state of Minnesota ($150,000) for 25 percent.
Plans for moving the call center from its current location near Brownsdale have been in place practically since its inception eight years ago, according to CRC CEO Todd Penske. The quickly growing company provides 24-hour call-center service to customers of more than 100 electric cooperatives in 28 states. CRC also monitors security alarm systems for customers, and does medical alarm monitoring and energy management monitoring.
The next phase of renovations at the city’s Wastewater Treatment Plant and $4.2 million in low interest bonds to pay for it were next on the agenda.
Although the renovations – the installation of equalization tanks and a new pumping station – eventually will be paid for entirely by Hormel, City Administrative Services Director Tom Dankert advised council members that the city should begin the steps needed to issue general obligation bonds for the company. Hormel partners the city in the industrial portion of the treatment facility, and will pay back the city for the cost of the bonds, which gives the company a lower interest rate.
"Two points off the interest rate can add up pretty quickly on $4.2 million," Dankert said, adding that the state had the monies available if the city could get its application in quickly enough.
Public Works Director Jon Erichson explained that this next phase will allow the plant to balance out the treatment loads by storing excess. Then, instead of the current five days of heavy loads and two days of light loads, the treatment facility can run at a steady pace seven days a week. He added that more odor control measures are a part of the renovation.