Council approves expense at Valley Technology Park on a 4-3 vote; Hoiseth defends reasons behind purchase
How much is too much when it comes to spending money on a coffee maker and coffee?
The Crookston City Council on a 4-3 vote Monday evening approved a check for approximately $1,200 included in the City’s most recent batch of checks and bills that the council routinely approves in a single resolution as part of their consent agenda. The check is to cover the costs of a commercial-grade coffee maker and coffee, from Chickadee Coffee Roasters in Crookston, that is part of renovations currently underway in the lobby and front office area of Valley Technology Park, headquarters of the Crookston Housing & Economic Development Authority, which also serves as the building’s manager/landlord for various agency and organization tenants, as well as businesses in the rear bays.
As part of the renovations, in an effort to showcase some Crookston businesses, a small “coffee bar” of sorts for tenants, business clients and people attending various meetings at VTP is being installed. In addition to featuring coffee from Chickadee Coffee Roasters, the area will feature some materials from Benoit’s Barnwood, and also a display from Real Good Bath & Body.
CHEDA’s previously approved 2019 budget included $25,000 in capital improvements to VTP, which would come from the building budget.
At Monday’s meeting, Ward 3 Council Member Clayton Briggs asked that the resolution involving the latest City bill run be pulled from the consent agenda and added to the main agenda for the purposes of discussing it further. During the subsequent discussion, Mayor Guy Martin said the expense was brought to his attention and he wanted it discussed further. Martin said he didn’t feel that spending $1,200 on a coffee maker and coffee was an “appropriate way to spend taxpayer dollars.”
Ward 1 Council Member Jake Fee, citing his experience at the Crookston Eagles, said regulations don’t allow for an entity such as CHEDA to buy a “Mr. Coffee coffee maker at Walmart” and use it. A commercial-grade coffee maker is required, he said, and such makers are expensive.
Although the $25,000 capital improvement expenditure was approved previously, City Finance Director Angel Weasner said she was not made aware of “any of these purchases until the bills showed up at city hall.” She added that the City is “not allowed to spend that kind of money on things like this.”
Weasner, as well as others who voiced their opposition to the expense, was referring to two previous audits of other Minnesota agencies that red-flagged expenses for things like coffee and rolls consumed by employees or at non-public meetings. The audit concerns also extended to cake bought for a reception for a retiring employee or flowers for employers who have had medical emergencies. One audit cited Monday was of the Housing and Redevelopment Authority in St. Cloud from 1997. Another audit of the Minnesota Lottery in 2003 raised similar concerns, and afterward employees were required to buy their own coffee.
Martin said that neither Weasner nor City Administrator Shannon Stassen were comfortable approving the expense. He said that he “investigated the matter a little bit” and “I don’t think anyone knew it was going to be $1,200 for a coffee maker and coffee.” Martin suggested that VTP tenants contribute to the cost, to which Fee responded that the money is coming from the VTP budget itself, which is buoyed by rent paid by building tenants.
At Large Council Member and CHEDA Board Member Tom Vedbraaten defended the expense, too. “The point of all of this was to showcase local businesses (to other potential business people coming to town),” he said.
Briggs said Weasner and Stassen should have been made aware of the specific purchase before it was approved. “How do we explain that to the taxpayers?” he wondered.
“Let’s get this straight,” Fee responded. “This is not coming out of the CHEDA budget, it’s the Valley Tech budget. It used to be in the red every year and now it’s in the black with a healthy balance.”
Ward 2 Council Member Steve Erickson, while saying he doesn’t discount the importance of concerns raised by audits for the type of expenses debated Monday, said taxpayer money is being spent on cake and coffee and receptions for retirees or buying food and drinks for volunteers helping out in various capacities. “This is every day stuff we do as a City,” he said.
Ward 5 Council Member Dale Stainbrook was not in attendance Monday. Fee, Erickson, Vedbraaten and At Large Council Member Bobby Baird voted in favor of approving the bill. Briggs was joined in voting against approving it by Ward 4 Council Member Don Cavalier and Ward 6 Council Member Cindy Gjerswold, who noted that VTP is “not a restaurant.”
CHEDA Executive Director Craig Hoiseth was attending the Final Four in Minneapolis and was not in attendance at Monday’s council meeting. Reached by the Times afterward for his reaction to the debate that transpired that evening, he said it’s part of CHEDA’s strategic plan to build a “creative space” at VTP that markets and brands local entrepreneurs and artists. The coffee maker and coffee aspect of the area, he said, is specifically to showcase Jerry Snow and his Chickadee Coffee Roasters in Crookston. “He made this exact equipment recommendation,” Hoiseth noted, adding that VTP’s Bunn coffee maker died a few years back and a Farmer Brothers machine had replaced it, but that Farmer Brothers coffee is not a Crookston product. Buying a new Bunn machine with proper certification was $649, Hoiseth said. “We opted to spend ($170 more) to follow Mr. Snow’s recommendation and be commercially safe,” he said.
Hoiseth added that VTP is run “lean” every year, resulting in increased savings that have made the current project possible.
Responding to the audit concerns, Hoiseth said it’s not about buying coffee equipment, it’s about employees drinking coffee, eating cake and buying gifts. CHEDA staff drink very little coffee, but VTP tenants and those who attend various meetings enjoy it more, he said. “Sending a professional, you are welcome and respected here message is all we’re trying to do,” Hoiseth added. “That’s why we always hand them a mug (with a tenant logo) instead of a paper or Styrofoam cup.
“This is not about Craig, Theresa and Tiffany (CHEDA staff members Theresa Tahran and Tiffany Jones) drinking coffee,” he continued, adding that he could easily use his own Keurig if need be. “It’s about saying thank you to our fantastic tenants and respecting all guests while featuring a great new business in our town.”
Annual audits of CHEDA have never raised red flags regarding coffee or similar items, he noted, adding he doesn’t want Crookston taxpayers to think he is being self-serving in any way. “I work for them,” Hoiseth said, before adding:
“I signed off on the purchase. I take responsibility for buying this recommended equipment. I’ve learned a lot about coffee since meeting Mr. Snow. I also see why he is so successful at business. My motives are genuine and my actions are appropriate given what vision we are carrying out in economic development. I’ll always defend buying in Crookston and supporting our local businesses. If we don’t, how can we ask others to?”