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                                PIERRE CITY PLANNING COMMISSION MEETING
                                            COMMISSION ROOM
                                        Monday, December 22nd, 5:15 P.M.

Members present were Hal Rumpca, Mike Kelley, Bill Markley, Dave Templeton and Stacy Bartlett.

Staff members present: Sharon Pruess, John Childs and Cindy Neumann.

Guests present: Bill Huebner, Jim Protexter, Toby Morris and John Raben.

Chairperson Mike Kelley called the meeting to order at 5:14 p.m. Rumpca made a motion seconded by
Markley to approve the minutes with corrections for the October 27th, 2008 meeting. Approval was
unanimous. Motion carried.

First on the agenda was a Development Agreement & TIF Plan- TIF #5, Lots 1-5, Eagle Hills
Development and Lot 7A, Block 7, Oscarson’s Second Addition. Petitioner- PEDCO. Chairman Mike
Kelley excused himself from participating in this agenda item and Hal Rumpca took over as chairman.
PEDCO is requesting approval of a TIF Plan and Development Agreement to develop a proposed
commercial/office park. The legal boundaries of the TIF district were previously established by the City
Planning Commission and the City Commission in April of 2008. The district includes the Reinke/Gray
Office building on Lot 7A of Block 7 and Lots 1-5, Eagle Hills Development. The Eagle Creek
Software building on Lot 1 of Eagle Hills Development is nearing completion and Lots 2-5 are currently
vacant. The TIF plan and development agreement provides for $828,000 in tax increment financing to
assist in financing the project. The tax increment payments of approximately $74,493 per year would be
forwarded from the Hughes County Treasurer to the City of Pierre. The City of Pierre would pass
payments through to the Rural Economic Development Fund to pay off a 10-year note in the amount of
$465,000 at 4.8% interest. After the REED note is paid off in approximately 10 years the remaining
$363,000 would be used for additional economic development projects to be determined by the City of
Pierre and PEDCO. The total estimated cost of the new office building is $4.2 million. The TIF Plan
and Development Agreement were prepared by Toby Morris with Northland Securities and Todd
Meierhenry with review by the City Attorney and staff. Morris indicated that the valuations, tax
increment payments and time periods for loan repayment were conservative estimates. The $828,000
plus interest will likely be repaid prior to the 20-year term for the TIF, especially if further development
occurs on vacant Lots 2-5 of the Eagle Hills Development.

Pruess noted that the Comprehensive Plan shows the projected land use in this area as Commercial
zoning. The key question in approving TIF projects is whether this development would have occurred
“but for” the availability of TIF financing. Pruess said that after review/revision by the City Attorney,
the staff recommends approval of the TIF Plan & Development Agreement. Pruess then asked the board
if they had any questions for Toby Morris or Jim Protexter. Rumpca asked Pruess if development
occurs and the taxes increase, which will cause it to be paid off quicker, would the agreement end?
Pruess responded with a “yes”. The term of the TIF is 20 years, however if the other vacant lots develop
the $828,000 will likely be paid off sooner. He also questioned the impact to taxing agencies. Pruess
referred the board to page 14 in the Tax Increment Plan. Page 14 provides a table that details the impact
on local jurisdictions such as the School District and Hughes County. Toby Morris with Northland
Securities explained that the development would not have happened without the TIF. He added that the
state, county and city are partners in this project.

Pruess said that the City would not be issuing bonds to finance the project. The Rural Economic
Development Fund (REED) is providing a $465,000 loan at 4.8% interest. The City’s obligation would
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be to pass the $74,493 per year in estimated tax increments from Hughes County to the REED fund.
Morris explained that the city will not be responsible for any shortfall in the tax increments and the loan
amounts due for the new building. Bartlett wondered since the state of the economy is in recession,
what would happen if Eagle Creek backed out after approval. Morris said that based on the strength of
the lease between PEDCO and Eagle Creek, the monthly lease amount includes debt service and taxes.
Protexter added the City of Pierre was competing with Dakota Dunes and Yankton for Eagle Creek’s
business, and even though Dakota Dunes had an existing building, Eagle Creek chose Pierre because of
the financial package offered including the TIF.

A motion was made by Templeton to recommend approval of the Development Agreement and TIF plan
for TIF #5. The motion was seconded by Markley. Approval was unanimous with the exception of
Kelley who abstained from voting. Rumpca turned the meeting back over to Chairman Kelley.

Second on the Agenda were Plats- Lot DSG-1, Wilcoha Park Addition and Block 1, Ace Addition-
Petitioners – North Plains Leasing & Ace Steel and Recycling. Proposal: Ace Steel and Recyling is
proposing to purchase a portion of the property currently owned by North Plains Leasing and occupied
by the Dakota Supply Group (DSG) business. Ace Recycling is interested in purchasing that portion of
the property that is north of the Railroad Spur Line identified as Lot DSG-1. Platting Lot DSG-1 will
facilitate a transfer from North Plains Leasing to Ace Steel and Recycling. Lot DSG-1 does not have
public access due to the Railroad Spur Lines that do not have public access crossings. The City wants to
insure that Lot DSG-1 cannot be sold separately in the future because it does not have public access.
The City required a second plat of Block 1, Ace Addition that would combine all of the property then
owned by Ace Steel and Recycling. The City and the 2 property owners negotiated to vacate some
existing right-of-ways as shown on the plat in exchange for a turn-around at the termination of Industrial
Road on Lot 7 and for platting the property into one large lot. The 2 plats are proposed to be filed at the
same time to first allow the transfer of Lot DSG-1 and then to plat all of the property owned by Ace
Recycling into one lot. City ordinance section 12-7-203 requires that junk yards be obscured from any
street or adjacent property by a sturdy, site obscuring fence. Have advised Ace Steel that screening of
the salvage operation will be required.

Pruess began with reviewing the plat with the board. She informed the board that all three parties in this
case negotiated to accomplish their goals. Ace Steel and Recyling wanted to purchase additional
property for their salvage operation and Northplains Leasing wanted to sell a portion of their property.
The City wanted to be sure there were no future access issues and wanted to insure that a turn-around
was provided at the west end of Industrial Road. She introduced Bill Huebner, to answer any questions
related to the 2 plats. Huebner stated that Ace Steel and Recyling purchased the property approximately
3 months ago and wanted to expand the existing property by purchasing the northerly portion of Dakota
Supply Group’s lot. He noted that he provided a letter indicating he would install a nine foot high
corrugated steel sheet metal screen fence along the North, West and South boundaries of the property by
October 15, 2009. He will move the scrap metal farther to the West, as he likes the property to have a
clean appearance. Pruess said that Ace Steel & Recycling as the new property owner has made some
improvements including a paved parking pad in front of the existing building and adding overhead
doors. Rumpca asked if the city would be satisfied with the screening fence as proposed. Pruess said the
City had requested the plan for the screening fence in writing and is satisfied with the plan. Huebner
indicated that they would be trying to add a rail spur through the railroad to transport salvage materials
out and new steel in. Rumpca asked whether or not the street would remain dedicated. Pruess said the
70’ dedicated but unimproved street would be vacated but the City would retain a utility 70’ wide utility
easement as there is existing sewer within the 70’. Rumpca made a motion to recommend approval of

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the plats of Lot DSG-1 and Block 1 of the Ace Addition. The motion was seconded by Templeton.
Approval was unanimous.

Under Old Business update for the Comprehensive Plan. Pruess informed the board that the
Comprehensive Plan was approved jointly by the city and county on December 16, 2008. She also
stated that the final Plan will be available on the City’s website. She said that final hard copies of the
plan would likely be provided at the next Planning Commission meeting. Rumpca asked about the final
bill amount. Pruess said just over $69,000.00. She said the City was very happy with final product,
particularly the mapping resources provided by the consultant, Ulteig Engineers. Information from the
plan has been used for a number of projects already including a strategic planning session held by the
City Commission. Rumpca stated that he recognized that a lot of work was done on the Plan and
thanked all involved. Pruess distributed a sheet that showed the meeting reimbursement for each
Commissioner for 2008, she said that she would be adding the December meeting to the list and that
payment would be made early in 2009. Rumpca mentioned that they would still like to go on a tour.

With no further business to address, Markley made a motion to adjourn the meeting and Templeton
seconded the motion. Meeting adjourned at 5:44 p.m.

Minutes by Cindy Neumann.

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