EDA hires new director, OKs Frazee project

The Becker County Economic Development Authority on Thursday agreed to offer the vacant economic development director position to Guy Fischer, a Detroit Lakes native who has 10 years experience as a community development specialist in Minneapolis.

Fischer received a "glowing" review from his Minneapolis supervisor when the EDA did a reference check; he also wants to move his family back to Detroit Lakes, where his parents still live, in order to take advantage of the Detroit Lake school system, according to Housing head and acting EDA director Jon Thomsen. Jan. 3 start date.

He was one of four finalists interviewed for the job.

Also on Thursday, the EDA agreed to provide $18,000 in aid to Marine Innovations, a Frazee company looking to expand.

The EDA originally sought to donate a 2.55 acre parcel of land in the Frazee Industrial Park, owned by the county EDA and worth about $20,000, to Marine Innovations, a manufacturing firm that now shares leased space there with Quantum Manufacturing.

But after Becker County Attorney Joe Evans questioned the legality of an outright land donation, the EDA opted to charge $2,000 for the land.

The Frazee Community Club, which acts as a de-facto chamber of commerce for Frazee, agreed to pick up the $2,000.

In a letter to the EDA, Evans wrote: "It is my opinion that the EDA may have authority to sell property at a price less than full market value. Obviously, this is not the same as an outright donation of property. However, if a particular developer has a plan that, for instance, generates a significant number of jobs or otherwise furthers the purpose of the EDA, I believe the EDA could accept something less than full market value as an incentive."

At a recent County Board meeting, Commissioner Bob Bristlin spoke at length against the proposed land donation, noting that the state auditor's office had criticized the EDA several years ago for a $50,000 donation to the Detroit Lakes Community Center.

The county board nonetheless voted unanimously to support economic assistance to Marine Innovations, provided the county attorney's office approves the action.

Marine Innovations has 16 employees and expects to create an additional 24 to 34 new full-time jobs in the next 8-10 years.

New employees will be paid in the $11-$25 dollar per hour range, with a company-paid benefits package. Plans call for the hiring of six full time workers when the new building is ready for use.

The company builds the Incline Tram, an electrically powered inclined lift system that allows homeowners and others to access steep waterfront or other terrain.

Owned by Mike and Lori Botzet, the company was founded in 1990 and operated part-time until 1997, when it moved to Frazee and started operating on a full-time basis.

"They have a unique niche in the market," County Board Chairman Harry Salminen, who also sits on the EDA Board, said earlier. "I think there's a great potential for growth, and the EDA is trying to help them out."

Marine Innovations plans to open a 13,000-square-foot manufacturing plant, with room for expansion. Total development cost, including equipment, is estimated at $1.1 million, according to information from the EDA.

The land is in a tax-free JOB Zone, but the county is not offering any other incentives, such as tax increment financing or tax abatement.

Thomsen said he is comfortable that a land donation is well within the purview of the EDA.

"It definitely meets a public purpose -- there are at least three criteria that this meets," he said Thursday. "It just appears that everything we've found says we can do it."

Commissioner Karen Mulari, who also sits on the EDA Board, agreed. She recently attended a meeting where the EDA director at Little Falls talked about several instances in which the city donated land to promote economic development.

Thomsen noted that the City of Pipestone recently sold land to a wind turbine development for $1 an acre, on property that it had spent $7,000 per acre to acquire.

"What is clear is that we have conflicting information," said EDA Chairman Mike Metelak. "We don't want to cause you undue stress, we'll get it done," he said to Marine Innovations co-owner Lori Botzet, who was at the EDA meeting.

In the end, the EDA Board opted to err on the side of caution, and charge $2,000 for the land.

"I'd hate to see this come back to slap us," Salminen said. "The state auditor wrote us a nasty letter (about the community center donation). She came down on us pretty hard."

"This process will allow us to get answers that will help us in the future," Metelak said.