Koochiching Economic Development Authority acted Wednesday to give up its hold on land in the International Falls Business Park that is currently named in litigation between business owners and creditors.
The KEDA board decided in closed session that it would no longer pursue cancellation at this time of its deed with Koochiching Freshwater Fisheries, adding that it would work with the ultimate successful owner to bring jobs to the Business Park if possible.
“We are giving up rights until this is resolved and then we will come in to help somebody take ownership and finish it off and create jobs there,” said Paul Nevanen, executive director, KEDA.
KEDA entered into a developmental agreement with Freshwater Fisheries on July 9, 2007 which included transferring ‘Lot 2, Block 1, Plat’ of the Business Park to Freshwater, and reserving its rights to cancel the deed. Freshwater went defunct and never completed its development in the Business Park creating litigation between at least eight parties which had started but not yet completed construction of a building on the lot.
Nevanen said KEDA made land available to the original fishery according to the developer agreement, but it did not have dollars invested in the project. Operating on private funding, the partnership split over disagreements and a major investor pulled out which ended the project, he said.
“They defaulted on the development agreement and we retained control of the deed on the land at that time,” said Nevanen.
Contractors are suing the former owners for unpaid work. Nevanen called it an unfortunate situation but said that the company did pay an appraised market value for the land as required by KEDA.
KEDA has been fully paid for the plat, where Can Am Fisheries, one of the defendants, is presently in operation. Still, Nevanen said it was in KEDA’s best interest to limit its exposure in the suit, at least until the July 9 date to file an extension to retain all rights to the land.
“We thought it is in our best interest to relinquish the title on the land and whomever comes out in the suit, will get the building,” said Nevanen.
KEDA continued its commitment to the Freshwater Economic Development Project. “CAN-AM” came in to start a new fisheries processing business on a smaller scale, said Nevanen. It retained the original, unfinished building and KEDA provided an adjoining lot where CAN-AM constructed a second building.
Jenny Dougherty, director of the Small Business Development Center, provided an update to the board, noting a recent rise in new clients and repeat clients. She said the most frequent area of counseling are in business accounts, financial capital, buying or selling a business, and with start up assistance.
She is currently working with 38 “unique clients,” and said there are 14 new loan investments, requests and capital totaling $1.3 million. She said other clients have applied for another $3,255.00 in loans that have not yet closed.
She reports good turnout with Quickbooks classes taught through customized training at Rainy River Community College, and is working to improve enrollment in the business start-up class.
Dougherty said she is working with area businesses that want to prepare for winter cash-flow problems, particularly in the tourism industry area. She anticipates that more businesses are doing better planning now and that it will help them get through the next winter season.
The number of recent business sales in the area is impressive, said Dougherty. She assisted a number of the new owners with start-up.
“That says a lot for the area that people are able to sell their businesses, and people are able to buy them and reenergize the local economy,” Dougherty said.
She said the Women’s Business Network has had its ups and downs with turnout since it started in January 2008, but that it has steady attendance since switching to a fall-to-spring schedule. She said existing business owners are presenting good ideas and sharing with would-be entrepreneurs.
In other board news, KEDA approved a motion to transfer $20,000 between banks to provide a driver for cold-weather testing. The rationale was that a driver could be paid through KEDA until it is reimbursed from the company using the service.
The board also approved a $500 request from the International Falls Area Chamber of Commerce in support of the April 23 Job Fair at Rainy River Community College.
