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HEDRA enforces subsidy agreement with Pro-Build

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news Hastings, 55033

Hastings Minnesota 745 Spiral Boulevard 55033

In 2005, Lanoga Corporation, the parent company of Pro-Build in Hastings, entered into an agreement with the city, allowing Lanoga a subsidy to move into the Hastings Industrial Park. In exchange, Lanoga had to create at least four full-time jobs at $13 per hour and stay open for at least five years.

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Pro-Build did create new jobs - more, even, than they were required to. The business added eight jobs at a minimum of $18 per hour plus benefits by 2008. However, six months shy of the five-year mark, it closed.

Lanoga approached the Hastings Economic Development and Redevelopment Authority and the city to request that it not be required to pay back the six months worth of subsidy it forfeited by closing before the agreed-upon date. Initial calculations by the city put the value owed at roughly $40,000.

When the issue came before HEDRA at its last meeting, Feb. 10, it was not met with much favor.

"We recommend to not forgive the $40,000," said City Administrator Dave Osberg, speaking for city staff.

The big concern for HEDRA was, "are we going to set a precedent," said HEDRA President Ron Toppin.

City council and HEDRA member Danna Elling Schultz said she was concerned that if they freed Lanoga of the agreement, other businesses might start to think they could get a subsidy as well and not have to fulfill all the requirements that come with it.

HEDRA voted to deny the waiver.

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