HomeMy WebLinkAbout11-22-11City of Lakeville
Economic Development Commission
Regular Meeting
Agenda
Tuesday, November 22, 2011, 4:30 p.m.
City Hall, 20195 Holyoke Avenue
Lakeville, MN
Call meeting to order
2. Approve October 25, 2011 meeting minutes
3. Update on Business Marketing Strategy Project
(To be presented at the meeting)
4. Review and Approval of 2012 Community Development Block Grant
Application
5. Director's Report
6. Adjourn
Attachments:
October, 2011 Building Permit Report
September, 2011 Foreclosure Update
StarTribune article; Closing skill gap key to solving job crisis, 10/25/2011
Finance - Commerce.com article; Ideas are the easy part at Minnesota jobs summit
(update), 10/25/2011
Finance - Commerce.com article; Union takes issue with 'cheap labor' at Fleet Farm
project, 11/9/2011
y NO.
City of Lakeville
Economic Development Commission
Meeting Minutes
October 25, 2011
Marion Conference Room, City Hall
Members Present: Comms. Matasosky, Brantly, Schubert, Emond, Longie, Smith,
Tushie, Ex- officio member Chamber of Commerce Executive Director Todd Bornhauser,
Ex- officio member City Administrator Steve Mielke.
Members Absent: Comms. Starfield, Vlasak, Ex- officio member Mayor Mark Bellows.
Others Present: David Olson, Community & Economic Development Director; Adam
Kienberger, Economic Development Specialist; Daryl Morey, Planning Director.
1. Call Meeting to Order
Chair Matasosky called the meeting to order at :30 p.m. in the Marion Conference
Room of City Hall, 20195 Holyoke Avenue, Lakeville, Minnesota.
2. Approve September 27, 2011 Meeting Minutes
Motion 14.11 Comets.: Emond /Schubert moved to approve the minutes of the
Septemberr,; 27, 2011 meeting as presented. Motion carried
unanimously.
3. Discuss Office Park District (OP) Zoning
Mr. Morey: reviewed -the EDC memo written by planning consultant Dan Licht
outlin#ng suggested, changes to the OP Zoning District to allow for manufacturing
uses: He reviewed' and discussed the three options provided in the memo to allow
manufacturing in the OP District..
Comm.- Brantly noted that there should be limitations on truck traffic.
Vice Chair Tushie responded that truck traffic gets restricted mostly by the nature of
the use in the _ District. He added that he liked Eagan's language referring to
packaging, storage, assembly, etc.
Chair Matasosky stated that we should be trying to match the ordinance more to the
market. The ordinance requirements concerning exterior building materials don't
align with the businesses currently in the Fairfield Business Campus. We are
effectively zoning out the businesses that built there.
Economic Development Commission
Meeting Minutes
October 25, 2011
Vice Chair Tushie responded that a business like New Morning Windows, while it
jump - started the Office Park District, belongs in an industrial zoned area. The Office
Park District should be different than the Industrial Districts.
Mr. Olson stated that the intent of the exterior building material requirements from
the 2010 Zoning Ordinance wasn't meant to raise the bar in the Office Park District,
but to clarify and separate office uses from industrial uses.
The EDC reached consensus on proposing language for the Office Park District that
would allow assembly and related uses as permitted uses while allowing light
manufacturing meeting specific performance standards by conditional use permit.
Mr. Morey concluded that this item will be brought to the Planning Commission at
their November 17 work session as part of an overall zoning ordinance update.
4. Update on Business Marketing Strategy Project
Mr. Kienberger provided an update to the EDC on the status of the Business
Marketing Strategy. Consultants from Arnett Muidrow & Associates conducted
several focus groups and individual interviews during their visit on October 3 -5
They are working on compiling results and branding ideas that will be presented
during their next visit November 16 -18 ";
The EDC and Planning Commission will be meeting jointly on November 17 to
discuss the results with the.marketing consultants:
5. Review of Presentation to. 360 Communities by Mark Jacobs of the Dakota
Scott Workforce Investment Board
Mr. Olson reviewed a presentation from the Dakota Scott Workforce Investment
Board discussing local employment and economic trends.
6. Director's Report"',
Mr. Olson reviewed the Director's Report. The EDC viewed the Greater MSP
marketing'video that was presented at an event attended by staff.
7. Adjourn
The meeting was adjourned at 6:00 p.m.
Respectfully submitted by:
Attested to:
Adam Kienberger, Recording Secretary R. T. Brantly, Secretary
2
City of Lakeville
Community and Economic Development
Memorandum
To: Economic Development Commission
From: David L. Olson, Community and Economic Development Director
Adam Kienberger, Economic Development Specialist
Copy: Steve Mielke, City Administrator
Date: November 22, 2011
Subject: 2012 Community Development Block Grant (CDBG) Application
The City is required to submit its 2012 Community Development Block Grant (CDBG)
application to the Dakota County CDA by January 15, 2012. It is anticipated that
the City will receive $95,865 in 2012, which is a projected 17% reduction from what
was received in 2011. The CDA is continuing its requirement that 50% of a City's
activities to be funded with CDBG funds involve activities that benefit Low - Moderate
Income (LMI) households.
One of the more commonly identified LMI activities in other cities in Dakota County
is the Home Rehabilitation Loan program (residential rehab) administered by the
Dakota County CDA. Preservation of the existing residential neighborhoods adjacent
to the Downtown has been identified as a goal of the City Council approved
Downtown Development Guide. Due to the increase in home foreclosures and
economic hardships, this program will likely remain active and will potentially see an
increase in demand. Through the end of September, there is approximately a
$38,300 balance available in the current program budget which is enough for up to
two loans. Attached is a copy of a CDA brochure that describes this program in
greater detail and also includes the current income guidelines for the program. Staff
would recommend a funding level increase for this program of $47,933 for 2012.
A new activity proposed in the 2012 application is allocating CDBG dollars towards
Spot Acquisition and Clearance. In years past this activity was designated
specifically in the Downtown area, but staff is proposing the activity be utilized on a
spot basis to acquire and demo properties on a strategic basis City -wide. Staff is
recommending a funding level of 50% or $47,933 to create a new Spot Acquisition
and Clearance category.
The other activity previously funded with previous years allocations is the Downtown
Code Improvement Program. This activity currently has a balance of $195,100 from
funding in previous years. It is recommended that no additional funding be sought
for this program in 2012. HUD guidelines have made this program more challenging
to administer and less effective in terms of the assistance able to be provided to a
Downtown building owner. Furthermore it is being recommended that $115,000
from this activity be reprogrammed to the new Spot Acquisition and Clearance
activity.
2012 Funding Recommendations
Staff recommends the following activities to be funded with the City's 2012 CDBG
allocation.
Home Rehabilitation Loan Program $47,933
Spot Acquisition and Clearance $47,932
Requested Action
Staff requests the EDC discuss these recommendations and forward its
recommendation to the City Council.
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City of Lakeville
' Community and Economic Development
Memorandum
To: Economic Development Commission
From: David L. Olson, Community and Economic Development Director
Copy: Steve Mielke, City Administrator
Adam Kienberger, Economic Development Specialist
Date: November 18, 2011
Subject: November Director's Report
The following is the Director's Report for November, 2011.
2011 Manufacturers Appreciation Event
This year's event was held on Thursday, October 27 at the Holiday Inn and Suites.
Over 70 people attended this year's event. We had approximately 100 people RSVP
so unfortunately a number that planned to attend were not able to. I want to thank
all of the EDC members that were able to attend. A number of the new businesses
in the Industrial Park, such as Superior Access Solutions, Computer Science
Corporation, and representatives of Genpak's Bloomington plant that will moving to
the old Berry Plastics plant in Lakeville were able to attend and meet both
representatives of the City, as well as other business representatives in attendance.
I also want to recognize our event sponsors that make this type of event possible.
They include Frontier Communications, Dakota Electric, Xcel Energy and Minnesota
Energy Resources.
Building Permit Report
The City issued building permits with a total valuation of $61,058,327 through
October. This compares to a total valuation of $47,887,658 through October of
2010. The City issued commercial and industrial permits with a total valuation of
$9,224,000 through October compared to a total valuation of $3,660,000 through
October of 2010. It should be noted that the full building permits for the Walmart
and Hosanna Senior Housing projects have not been issued, however, are expected
to be issued before the end of the year.
The City has also issued permits for 105 single family homes through October with a
total valuation of $32,606,000. This compares to 114 single family home permits
through October of 2010 with a total valuation of $31,314,000. The average value
of the single family permits issued to date in 2011 is $310,533 compared to an
average value of $274,684 during the same period in 2010.
Development Update
ConAgra: ConAgra is seeking approval of a Site Improvement Performance
Agreement by the City Council at their November 21s meeting. This agreement will
authorize ConAgra to relocate existing City water, sanitary sewer and storm sewer
trunk mains to facilitate a 27,000 square foot warehouse addition on the west end
of their plant. Work on the utility relocation is expected to begin shortly after the
City Council's approval of this agreement.
Genpak LLQ Genpak recently closed on the purchase of the former Berry Plastics
Plant located at 8235 220 Street. Genpak will consolidate the existing operations
from the small Lakeville plant that currently has 10 employees along with their
Bloomington plant that currently has 120 employees at this new location in Lakeville.
Remodeling of the former Berry building will begin soon and Genpak plans to phase
in the relocation to this facility.
Hosanna / Ebenezer Senior Housing Project: Footings and foundation work is
nearly complete for the 93 unit senior housing project. Krause - Anderson is the
general contractor. This project obtained housing revenue bond financing from both
the Dakota County and Scott County CDA's.
Walmart Project: The site work for this project is mostly completed. Walmart is
currently reviewing bids for the construction of the building and expects to award a
contract sometime in December. Weis Builders is the contractor for the site work
phase of the project.
ImageTrend: Construction continues on the ImageTrend expansion located at
20855 Kensington Blvd. in the Fairfield Business Campus. This two -story addition is
scheduled to be substantially completed by the end of the year.
Goodwill: Construction has been completed and the City issued a certificate of
occupancy on approximately November 1 st for the 20,000 square foot new Goodwill
store located on Kenrick Avenue adjacent to the Minnesota Tile building just west of
the Comfort Inn Motel. Stonehenge Development is constructing this new store and
will be leasing it to Goodwill. Goodwill has indicated that they plan to open the
store in late January.
Foreclosure Update
Attached is a copy of the September Foreclosure Update from the Dakota County
CDA. There were 25 Sheriff Sales in Lakeville during the month of September. The
number of Sheriff Sales has average 24 per month for the first nine months of 2011.
The total number of Sheriff Sales though September is 217 compared to 317 in all of
2010.
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CDA Dakota County OW N E RS
Community Development Agency come&
09060600049*6*60000006
To: Dakota County Cities
From: Lisa Henning
Date: October 19, 2011
Re: Foreclosure Update
NFMC Congressional Report
In a little more than three years, the National Foreclosure Mitigation Counseling (NFMC)
Program has served 1.2 million at -risk homeowners across the country and helped to
strengthen the nation's foreclosure counseling capacity.
Since December 2007, Congress has made five appropriations totaling $539.87 million to fund
the NFMC Program. NeighborWorks® America (as authorized by the Neighborhood
Reinvestment Corporation Act, 42 U.S.C. 8101 -8107) was appointed to administer the NFMC
Program, and submits the Congressional Update to Congress.
The report released on September 13 covers reporting from February 26, 2008 through June
30, 2011. A few notable findings include:
• The Program provided foreclosure counseling to 1,168,062 homeowners in all 50 states,
the District of Columbia and the U.S. territories.
• The Program helped homeowners receive loan modifications that reduced their
monthly mortgage payments by an average of $267 more than they would have obtained
without NFMC counseling, representing more than $560 million in annual savings to
NFMC - counseled homeowners (based on third -party program evaluation conducted by
the Urban Institute).
• Sixty -five percent of NFMC program clients now report holding fixed -rate mortgage.
For the first time in the program, more than half of all clients — 53 percent — report
holding fixed -rate mortgage with interest rates below 8 percent, the most desirable
mortgage product on the market.
• The majority of clients (60 percent) reported a reduction in or loss of income to be the
primary reason for facing foreclosure. This has been the primary reason reported by
homeowners throughout the program.
The report can be viewed in its entirety at
http: / /www.nw.org /network/nfmcp /documents /201 I CongressionalReport.pdf
HOME
CDA Dakota County OWNERS
Community Development Agency co (,off
090000000000*0*0000006
Dakota County Stats — September 2011
• # of Sheriff Sales in September — 173 (compared to 216 in September 20 10)
• Total Sheriff Sales for 2011 — 1,518 (compared to 1,685 Jan.- September 20 10)
• # of Notices of Pendency Filed in September — 300
• Total Notices of Pendency Filed in 2011 — 2,185
A Notice of Pendency is filed by a mortgage company's attorney as official notification that the
foreclosure process has begun. Not all of these result in Sheriff Sales.
Mapping Using Dakota County GIS
http://gis.co.dakota.mn.us/website/dakotanetE
The Dakota County Office of GIS is updating the 2011 Foreclosures and Notice of Pendency
layers on a monthly basis. If you need assistance using this Web page, please call Randy Knippel
or Mary Hagerman with the Office of GIS at (952) 891 -7081.
In The News
Provided in this PDF file are a few notable foreclosure articles that were published in the last
month. Among the points of interest:
• The Federal Housing Finance Agency, which oversees Fannie Mae and Freddie Mac,
planned to file suits against more than a dozen large banks, accusing them of
misrepresenting the quality of mortgage securities they assembled and sold at the height
of the housing bubble.
• Illegal or questionable mortgage paperwork may be even more widespread than what
was thought with practices possibly dating back to the late 1990s.
• The number of U.S. homes that received an intitial mortgage default notice — the first
step in the foreclosure process — jumped 33 percent in August from July, foreclosure
listing firm RealtyTrac Inc. said in a report released last month.
• Faulty mortgage and foreclosure abuses have cost the nation's five biggest home lenders
at least $65.7 billion
If you have any concerns, please call me at (651) 675 -4467 or send me an email at
IhenningCcD-dakotacda.state.mn.us
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Page 1 of 1
Mortgage debacle cost
banks $6613
Article by: JAMES STERNGOLD , Bloomberg News
Updated: September 17, 2011 - 7:38 PM
Faulty mortgages and foreclosure abuses
have cost the nation's five biggest home
lenders at least $65.7 billion, according to a
tally by Bloomberg News, and new claims
may push the industrywide total to twice that
amount.
Bank of America Corp., the largest U.S.
lender, had the biggest costs, totaling $39.1
billion since the start of 2007, according to
data compiled by Bloomberg. J.P. Morgan
Chase & Co. followed with $16.3 billion, and
Wells Fargo & Co., the biggest U.S. home
lender, had $5.09 billion.
The costs have eclipsed predictions from
bankers and analysts that lenders would
suffer only modest damage from what Bank
of America Chief Executive Officer Brian
Moynihan has called "the mortgage mess."
Paul Miller, an FBR Capital Markets & Co.
analyst, said costs for all banks could
for lax lending practices.
Bloomberg's tally was compiled from
regulatory filings, company statements and
financial presentations by the nation's five
biggest mortgage lenders. The data cover
provisions and expenses attributable to
repurchases, foreclosure errors and abuses,
payments to reimburse investors for lost
value on faulty mortgages, legal settlements
and litigation expenses.
The compilation also includes write -downs
of assets, such as mortgage servicing rights,
when the company attributed the loss in
value to problems in mortgage underwriting
or foreclosures and the costs of remedies.
The figures may increase as more detailed
breakdowns become available.
Miller, a former bank examiner, previously
said costs might range from $54 billion to
$106 billion for the banking industry. Under
his new $121 billion estimate, which covers
only repurchase costs, Bank of America,
Wells Fargo, J.P. Morgan and Ally Financial
Inc. will bear 60 percent of the burden, with
Bank of America alone paying 33 percent.
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FHFA ready to sue big
banks
By Nelson D. Schwartz
New York Times
Updated: 09(01(2011 10:42:24 PM CDT
The federal agency that oversees mortgage giants
Fannie Mae and Freddie Mac is set to file suits
against more than a dozen big banks, accusing
them of misrepresenting the quality of mortgage
securities they assembled and sold at the height of
the housing bubble, and seeking billions of dollars
in compensation.
The Federal Housing Finance Agency suits, which
are expected to be filed in coming days in federal
court, are aimed at Bank of America, JPMorgan Chase
and Deutsche Bank, among others, according to
three individuals briefed on the matter.
The suits stem from subpoenas the finance agency
issued to banks a year ago. If the case is not filed
today, they said, it will come Tuesday, shortly
before a deadline expires for the housing agency to
file claims.
The suits will argue that the banks, which
assembled the mortgages and marketed them as
securities to investors, failed to perform the due
diligence required under securities law and missed
evidence that borrowers' incomes were inflated or
falsified. When many borrowers were unable to pay
their mortgages, the securities they backed quickly
declined.
soured mortgage- backed bonds, but this federal
effort is a new chapter in a huge legal fight that has
alarmed investors in bank shares. In this case,
rather than demanding that the banks buy back the
original loans, the finance agency is seeking
reimbursement for losses on the securities held by
Fannie and Freddie.
Bank of America and JPMorgan declined to comment.
Frank Kelly, a spokesman for Deutsche Bank, said,
"We can't comment on a suit that we haven't seen
and hasn't been filed yet."
But privately, financial services industry executives
argue that the losses on the mortgage- backed
securities were caused by a broader downturn in the
economy and the housing market, not by how the
mortgages were originated or packaged into
securities. In addition, they contend that investors
like AIG as well as Fannie and Freddie were
sophisticated and knew the securities were not
without risk.
Investors fear that if banks are forced to pay out
billions of dollars for mortgages that later defaulted,
it could sap earnings for years and contribute to
further losses across the financial services industry,
which only recently has regained its footing.
Bank officials also counter that further legal attacks
on them will only delay the recovery in the housing
market, which remains moribund, hurting the
broader economy. Other experts warned that a
series of adverse settlements costing the banks
billions raises other risks, even if suits have legal
merit.
Fannie and Freddie lost more than $30 billion in
part as a result of the deals, losses that were borne
mostly by taxpayers.
In July, the agency filed suit against UBS, another
major mortgage securitizer, seeking to recover at
least $900 million, and the individuals with
knowledge of the case said the new litigation would
be similar in scope.
Private
holders of mortgage securities already are trying to
force the big banks to buy back tens of billions in
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The housing finance agency was created in 2008
and assigned to oversee the hemorrhaging
government- backed mortgage companies, a process
known as conservatorship.
"While I believe that FHFA is acting responsibly in its
role as conservator, I am afraid that we risk pushing
these guys off of a cliff and we're going to have to
bail out the banks again," said Tim Rood, who
worked at Fannie Mae until 2006 and is now a -
partner at the Collingwood Group, which advises
banks and servicers on housing - related issues.
The suits are being filed now because regulators are
concerned that it will be much harder to make
claims after a three -year statue of limitations expires
Wednesday, the third anniversary of the federal
takeover of Fannie Mae and Freddie Mac.
While the banks put together tens of billions of
dollars in mortgage securities backed by risky
loans, the Federal Housing Finance Agency is not
seeking the total amount in compensation because
some of the mortgages are still good and the
investments still carry some value. In the UBS suit,
the agency said it owned $4.5 billion worth, with
losses totaling $900 million.
The two mortgage giants acquired the securities in
the years before the housing market collapsed as
they expanded rapidly and looked for new
investments that were seemingly safe. At issue in
this case are so- called private -label securities that
were backed by subprime and other risky loans but
were rated as safe AAA investments by the ratings
agencies.
After the housing market began to stumble in 2007
and more homeowners began to default, the value of
these securities plunged.
In the years before 2007, "the market was so frothy
then it was hard to find good quality loans to
securitize and hold in your portfolio," said David
Felt, a lawyer who served as deputy general counsel
of the finance agency until January 2010.
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Widespread robo-
signing of mortgage
documents found as far
back as 1998 could
haunt owners
mortgage lenders over controversial
mortgage practices.
The problem of shoddy mortgage
paperwork, which comprises several
shortcuts known collectively as "robo-
signing," led the nation's largest banks,
including Bank of America Corp., JPMorgan
Chase & Co., Wells Fargo & Co., and other
lenders to temporarily halt foreclosures
nationwide last fall.
Article by: PALLAVI GOGOI , Associated Press
Updated: September 1, 2011 - 8:16 PM
NEW YORK - Counties across the United
States are discovering that illegal or
questionable mortgage paperwork is far
more widespread than thought, tainting the
deeds of tens of thousands of homes dating
to the late 1990s.
At the time, "robo- signing" was thought to
be contained to the affidavits that banks file
when a mortgage is issued and, somebody
buys a house. The documents are used to
prove they have the right foreclosure if the
homeowner isn't making mortgage
payments. Companies that process
mortgages said they were so overwhelmed
with paperwork that they cut corners.
The suspect documents could create legal
trouble for homeowners for years.
Already, mortgage papers are being
invalidated by courts, insurers are hesitant
to write policies, and judges are blocking
banks from foreclosing on homes. The
findings by various county registers of
deeds have also hindered a settlement
between the 50 state attorneys general who
are investigating big banks and other
But now, as county officials review years'
worth of mortgage paperwork, in some
cases combing through one page at a time,
they are finding suspect signatures — either
signed with the same name by dozens of
different people, improperly notarized or
signed without a review of the facts in the
paperwork — on all sorts of mortgage
documents, dating as far back as 1998, The
Associated Press has found.
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"Because of these bad titles, property owners
can't prove they own the properties they
think they bought, and banks can't prove
they had the right to sell them," says Jeff
Thigpen, the registrar of deeds in Guilford
County, N.C.
In Guilford County, where Greensboro is
located, a sample of 6,100 mortgage
documents filed since 2006 turned up 74
percent with questionable signatures.
Thigpen says his office received 456 more
documents with suspect signatures from
Oct. 1 through June 30.
The suspect signatures found by Thigpen
and other registrars around the country
were on documents from the banks involved
in the temporary foreclosure halt and
others.
Widespread robo- signing that stretches
back a decade or more could create
problems for homeowners. Regulators have
so far not asked lenders to clean up the
potentially millions of suspect documents
filed in the past decade or earlier. That
troubles some banking experts, including
Sheila Bair, who until early July was
chairwoman of the Federal Deposit
Insurance Corp.
"We do not yet really know the full extent of
the problem," Bair said in written remarks to
the Senate Banking Committee. She and
others have called for a comprehensive
study on the extent of the fraudulent
signatures in mortgage documents.
If documents with robo- signed signatures
are challenged in court, judges could
question the ownership of the properties,
says Katherine Porter, a professor at
University of California Irvine School of Law
and an expert on consumer credit law. The
consequences extend to homeowners in
good standing when they try to sell.
If invalid documents are discovered in the
chain of ownership, it could delay the sale or
make it difficult for buyers to get a mortgage
because title insurers won't write a policy for
the property, says Justin Ailes, vice president
of government affairs of the American Land
Title Association, a trade association
representing the title insurance industry.
Banks and other mortgage lenders won't
write a home loan without title insurance.
Among the findings shared with The
Associated Press by county officials from
several states:
_ An investigation of mortgage documents
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n4t = �,
in the county that includes Salem, Mass.,
found that more than 25,000 had suspect
signatures. The earliest date to 1998, says
John O'Brien, the registrar of deeds there.
_ In Michigan, the state attorney general has
sent criminal subpoenas to three companies
that processed mortgage paperwork after 24
local recorders of deeds looked through
their files and found rampant robo- signing.
_ An Illinois county, Kankakee, pulled a
sample of 60 documents filed since 2007 to
look for suspect signatures. All 60 were
"signed" by people who have been identified
as robo- signers. At least 12 county officials
in Illinois have sent their findings to the state
attorney general.
The results of these reviews are troubling to
the registers of deeds in counties across the
country. It's the job of these officials to
record documents on property transfers,
and they say, they need to be able to trust
that notarized paperwork is legitimate.
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National and
international report /
Mortgage default notices
jump 33 percent in
August
From wire reports
Updated: 09/14/2011 10:11:22 PM CDT
Banks have stepped up their actions against
homeowners who have fallen behind on their
mortgage payments, setting the stage for a fresh
wave of foreclosures.
The number of U.S. homes that received an initial
default notice - the first step in the foreclosure
process -jumped 33 percent in August from July,
foreclosure listing firm RealtyTrac Inc. said in a
report to be released today.
The increase represents a nine -month high and the
biggest monthly increase in four years.
Foreclosure activity began to slow in fall 2010 after
problems surfaced with the way many lenders were
handling foreclosures, namely shoddy mortgage
paperwork comprising several shortcuts known
collectively as robo- signing.
through the air - will do more to attract shoppers
to its stores during the all- important holiday
season.
CEO Jerry Storch said at a news conference
Wednesday that the company hasn't yet determined
how many pop -up stores it will open. But there will
be fewer than the 600 it had in 2010 and more than
the 90 it opened 2009.
Toys "R" Us, the largest U.S. specialty toy retailer,
made about 43 percent of its total 2010 revenue of
$13.57 billion during the holiday quarter.
Despite opening fewer pop -up stores, Toys "R" Us
plans to hire about the same number of seasonal
workers as in 2010, about 45,000.
Avis will be thrifty, drops bid for rival
Avis Budget Group Inc. said Wednesday that it's
dropping its bid to buy rival rental car company D
ollar Thrifty, citing current market conditions.
The Parsippany, N.J. -based company said in a
regulatory filing that while it has made significant
progress toward getting antitrust approval for a deal
and believes it could get a deal approved, buying
Dollar Thrifty Automotive Group Inc. isn't in its best
interest anymore.
Avis' decision to bow out leaves Hertz Global
Holdings Inc. as Dollar Thrifty's lone suitor,
following a tug of war between Hertz and Avis that
has dragged on for more than a year.
In all, 78,880 properties received a default notice in
August. Lenders repossessed 64,813 properties last
month, a drop of 4 percent from July and down 32
percent from a year earlier. Home repossessions
peaked in September last year at 102,134.
In all, 228,098 U.S. homes received a foreclosure -
related notice last month, a 7 percent increase from
July, but a nearly 33 percent decline from August
last year. That translates to one in every 570 U.S.
households, RealtyTrac said.
Toys 'R' Us plans fewer temporary stores
Toys "R" Us won't open as many holiday pop -up
stores this year as last, betting that offering more
exclusive toys - like Air Swimmers Extreme, a
helium - filled, radio - controlled shark that floats
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Earlier this year, Hertz offered to buy Dollar Thrifty
for $57.60 in cash and 0.8546 shares of Hertz stock
for each Dollar Thrifty share. That was a sweetening
of a previous offer made by the Park Ridge, N.J. -
based company last year and rejected by Dollar
Thrifty shareholders.
Jury gives DuPont $920M in trade suit
A federal jury awarded $919.9 million in damages to
the DuPont Co. on Wednesday in a trade - secrets
lawsuit involving high- strength synthetic fibers
used in products such as Kevlar body armor.
The award was made by a jury in Richmond, Va.,
following a trial that pitted Delaware -based DuPont
against South Korean competitor Kolon Industries.
The jury found that Kolon had maliciously and
willfully misappropriated 149 DuPont trade secrets
related to the technology, known as aramid fibers.
Kolon attorney Jeffrey Randall declined to comment.
The company released a statement saying that it
disagreed with the verdict and that it is confident a
favorable decision will be reached on appeal.
BRIEFLY NATIONAL
Businesses added to their stockpiles in July for a
19th straight month, and their sales increased by
the most since March. The Commerce Department
said business inventories rose 0.4 percent in July
following a similar gain in June. Business sales
increased 0.7 percent in July.
BRIEFLY INTERNATIONAL
Canada plans to fight the Buy American provisions
in the new U.S. jobs package proposed by President
Barack Obama and is surprised and frustrated that
the issue has come up again, the country's trade
minister said Wednesday. Trade Minister Ed Fast
said that the provisions are not acceptable to
Canada and that history shows protectionist
measures stall growth and kill jobs .... Moody's
downgraded the credit ratings of French banks
Societe Generale and Credit Agricole on Wednesday
following a period of huge volatility in the markets
as investors fretted about their exposure to Greece's
debts.
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I. Ft n
Closing skill gap key to
solving job crisis
Article by: , Star Tribune
Updated: October 25, 2011 - 11:49 PM
The key to jump- starting Minnesota's
economy may lie in how well it tackles a
bedeviling problem: a growing skills gap that
has left some Minnesotans unfit for jobs that
employers have to offer.
At a daylong jobs summit convened by Gov
Mark Dayton on Tuesday, frustrated
business leaders gathered from all parts of
the state to say they have hundreds of
openings but can't find workers qualified to
fill them. The skills gap persists even in the
face of a state unemployment rate that
stubbornly hangs around 7 percent.
"I don't think this is an easy road ahead for
our state," Dayton told the 800 participants
at the Crowne Plaza Riverfront hotel in
downtown St. Paul. "But it is a road we must
take."
Dayton pledged quick action after the day's
discussions -- he plans to issue an action
"We must begin immediately," he said.
Dayton convened the summit after holding
nine regional jobs meetings statewide in
which he asked local officials and business
leaders how best to boost the state's
economy.
The consensus: Businesses need help
getting access to capital and new markets,
and the gap between available workers and
jobs must be narrowed.
Years of recession have left the state with
persistent budget deficits, deep program
cuts and billions of dollars in loans. More
red ink means more cuts and testy political
fights with Republican legislators who have
demonstrated an ironclad resistance to tax
increases that Dayton wants.
The problem
As businesses adapt to a shifting economy,
they leave behind a glut of unemployed
workers from waning industries who are not
qualified for the new jobs being created.
Those workers increasingly can't afford or
don't want to relocate and retraining can be
expensive and out of reach.
Nathan Johnson, an administrator with
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Page 2 of 4
Pioneer Care nursing home in Fergus Falls,
said he could hire 15 licensed nurses today
-- 40 percent of Pioneer's available nursing
shifts, but he can't find qualified nurses.
"It might not sound like a lot in the Twin
Cities, but it's a lot for us," Johnson said
Many of the unfilled jobs are in health care,
but more are in vocational fields such as
welding, metal work and precision
machining, where jobs paying $20 an hour
or more go unfilled.
Traci Tapani's metal fabrication company,
Wyoming Machine in Stacy, recently
published a job opening at what she thought
was an attractive annual wage of $36,000.
Four weeks went by without a single
applicant.
Eventually, Tapani turned to a recruiting
firm, which usually just plucks employees
from rival companies, Tapani said.
"It's a very, very competitive situation in
manufacturing," she said.
Randy Hatcher, a development director at
Ultra Machine Co., has the same problem. He
often turns to a recruiter for precision
machining jobs, luring employees from a
competitor.
"It's a temporary solution, in my opinion,"
Hatcher said.
Manufacturing businesses worry about
being able to fill orders as fewer people look
to their field to make a living.
Some of the disconnect may stem from what
business managers and even some
educators say are overwhelming cultural and
parental pressures to push children into a
traditional liberal arts education where they
can pursue white - collar professions.
Hatcher said there is a "fear factor" in
selecting manufacturing as a job field,
especially when the career path is different
from that of their parents.
"It takes a lot of courage to jump in and try
it," he said.
State Education Commissioner Brenda
Cassellius said some parents and educators
need to take a second look at opportunities
in welding, machining and other vocations.
"We need to start talking to our kids about
these other jobs," she said.
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With the economy rapidly shifting and
sorting out winners and losers, civic and
business leaders see a growing reliance on
colleges and universities to retrain workers
for new fields.
Summit attendees said Minnesotans should
expect to change careers several times in
their work lives and allow for the possibility
that they may need to dip back into school to
be retrained.
Noel Lutsey worked as a printer for 32 years,
but computers and the Internet decimated
his industry. He was laid off three times in
five years.
"It was awful," Lutsey said.
Lutsey finally left the printing business and
returned to school.
He graduated from Anoka Technical College
and went to work for the school as its
education enterprise manager, helping
connect the school to the business
community.
As workers age, he said, they "are afraid to
go back to school. It's intimidating for them.
But as scary as it is, they are going to need
to do it."
A question that stumped participants is how
to pay for all the retraining.
"We need to get past the days of relying on
state support," said Steven Rosenstone,
chancellor of Minnesota State Colleges and
Universities. "There is no silver bullet. There
is no one source of funding."
Some attendees said tax increases will be
needed to meet heightened educational
demands -- an idea Republicans have fought
hard against.
Inez Wildwood, chair of the governor's
Workforce Development Council, jumped in
to say educators will need to "use what we
have, but use it better," drawing applause.
Despite what amounted to a laundry list of
obstacles, many business leaders say they
are optimistic.
"This is a great place to grow a business,"
said Bill George, former chairman and CEO
of Medtronic.
He said business leaders can't wait for
President Obama, Congress or even Dayton
to point the way.
"We cannot be searching for the savior,"
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George said.
Neil Crocker, president of Schaefer
Ventilation in Sauk Rapids, advised
participants to focus on a few manageable
initiatives from the summit and hold those
ideas to a tough test.
"it would be very easy to be all talk and no
action," Crocker said.
Baird Helgeson • 651 - 222 -1288
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Finance & Commerce > Print > Ideas are the easy part at Minnesota jobs summit (update) Page 1 of 2
Finance & Commerce
http: / /finance - commerce.com
Ideas are the easy part at Minnesota jobs summit (update)
by Chris Newmarker
Published: October 25th, 2011
Provide more money for workforce education, and while
we're at it, more for startup companies, too. Those were
a couple of the ideas floated around the statewide Job
Summit that Gov. Mark Dayton convened in St. Paul on
Tuesday.
Where the money will come from is another story —
especially when the DFL governor has a different
philosophy of government than the Republican -led state
Legislature.
Dayton opened the event by imploring a crowd of up to
700 people at the Crowne Plaza St. Paul — Riverfront
Hotel that there needed to be "no politics or polemics" in
the day's discussion.
"Today should be a day for ideas, not ideologies," Dayton
said. Only three GOP state legislators, however, were
expected at the event, said Dayton spokeswoman
Katharine Tinucci.
The event was the culmination of a series of nine regional
jobs summits that Dayton has held across the state over
the past two months. Dayton is seeking to shift the
state's focus to job creation after a bruising budget fight
with the Legislature that shut down the state government
for part of July. Dayton could release a full jobs plan to
the public as soon as Wednesday morning.
Minnesota's unemployment rate was 6.9 percent in September, more than 2 percentage points
lower than the U.S. rate of 9.1 percent. Even though Minnesota is doing better than the rest of
the country, the 53,600 jobs gained in the state over the past two years are only a third of what
was lost in the Great Recession.
Dayton said America and Minnesota's strength lies in innovation and entrepreneurship. During a
panel discussion after Dayton's speech, former Medtronic Chief Executive Officer Bill George,
now a professor at the Harvard Business School, called for more funding for startup companies,
an idea that drew applause from the crowd.
"Venture capital has been quite sparse here.... There is plenty of money available in Northern
California. There isn't any money available here," George said.
Proposals that George mentioned included creating a partially state - funded "innovation center"
near the University of Minnesota to provide a home for businesses looking to work with
university researchers. (Curiously enough, local health care consultant Peter Bianco has already
been leading efforts to build a Minnesota Science Park next to the University of Minnesota —
completely funded by private investors.)
Neil Crocker, president of Sauk Rapids -based Schaefer Ventilation Equipment, was on the same
four - person panel as George and expressed skepticism over whether the summit would produce
meaningful results, saying he was worried there would be a "laundry list, not a plan."
"We need to boil this down," Crocker said.
http: / /finance- commerce. com /Wp- contentlplugins /dmc sociable toolbar /wp- print.php ?p =... 10/26/2011
Gov. Mark Dayton held a statewide
Job Summit in St. Paul on Tuesday.
About 700 people attended the
event at the Crowne Plaza St. Paul
— Riverfront Hotel. (Staff photo: Bill
Klotz)
Finance & Commerce > Print > Ideas are the easy part at Minnesota jobs summit (update) Page 2 of 2
Crocker was also skeptical about the popular idea that an economic recovery could be led by
manufacturing. "That ship has sailed, except for the most sophisticated manufacturing jobs," he
said.
Minnesota House Majority Leader Matt Dean, R- Dellwood, was participating in a mid - morning
breakout panel on how to better market Minnesota. Dean said before the panel meeting that he
thought it helpful that the governor has been holding so many events in the past two months to
meet with business leaders. Dean was hopeful the events were giving the governor a new
perspective that would help him reach agreement on some initiatives with the Legislature.
Dean said he believes state government needs to focus more on lowering taxes and reducing
regulations, as well as showing a better attitude toward employers. The philosophy differs from
Dayton, who failed to persuade the Legislature to increase taxes on the wealthy to help pay for
government programs.
Asked why such a small number of Republican legislators were at the event, Dean said most of
his peers were out in their districts. "They're where they're supposed to be, doing their jobs,
from Roseau to Worthington," Dean said.
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Finance & Commerce > Print > Union takes issue with `cheap labor' at Fleet Farm project Page 1 of 2
Finance & Commerce
://finance-commerce.com
Union takes issue with `cheap labor' at Fleet Farm project
by Brian Johnson
Published: November 9th, 2011
Store in Carver receiving subsidies
from county, city
A publicly subsidized retail construction
project in Carver is drawing fire from local
union officials who say the project team is
using cheap labor from outside the area —
even as local workers are sitting on the
bench.
The $20.5 million Mills Fleet Farm store,
under construction near Highway 212 and
Jonathan Carver Parkway, is being built
with help from temporary laborers making
as little as $7.25 an hour, according to the
Local 563 laborers union in Minneapolis.
But the project team adamantly denies
using cheap labor and says most of the
work is being done by union tradespeople.
The project is receiving about $1 million in tax increment financing from the city and $1.6 million
in county subsidies for infrastructure improvements, said Carver County Commissioner Randy
Maluchnik, who said he is troubled by the reports of cheap labor.
Stewart Mills, co -owner of Brainerd -based Mills Properties, which is building the store, said that
both union and nonunion contractors were allowed to bid on the project and that 75 percent of
the work went to union contractors.
"All the contractors were prequalified and [were selected] based on qualifications and past
performance and their financial capability to follow through with the job," he said.
Bruce Buxton, principal with local architecture and engineering firm Widseth Smith Nolting, Mills'
project manager for the job, said the unions are inaccurately "making it sound like everyone on
that job is getting minimum wage."
In fact, he said, one subcontractor used two temporary workers for a total of three weeks while
regular crew members were finishing another job.
"This has been blown out of proportion," he said.
"Mills has been doing this work for many years, putting up a lot of buildings, and there has
never" been any concerns about safety or the quality of the work on any of those projects,
Buxton added.
"All those guys on that job would take offense at any [union accusations] that the job is not safe
and we are not doing quality work," he said.
But Tim Mackey, the business manager for the Local 563 laborers union in Minneapolis, says that
at least four temporary workers have been used, working for bargain basement rates, and that
nonunion contractors are bringing in workers from outside the area for everything from concrete
to roof work.
Those jobs, he said, should be going to unemployed building tradespeople who live in the area.
The local prevailing wage rate for that type of work is about $27 an hour, Mackey said.
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Construction is progressing on a new Fleet Farm
store in Carver. Local union officials say the project
is using cheap labor, but the owner says 75 percent
of the work is going to union contractors. (Staff
photo: Bill Klotz)
Finance & Commerce > Print > Union takes issue with `cheap labor' at Fleet Farm project Page 2 of 2
"We gave them a public subsidy — the city and county did," Maluchnik said. "And [the labor
situation] would not matter to me if we hadn't given them the public subsidy."
The labor kerfuffle in Carver isn't an isolated incident.
Local construction unions, dealing with unemployment as high as 50 percent in some trades amid
a grim construction economy, have cried foul about labor practices on other projects as well.
Last month, the Minneapolis Building and Construction Trades Council raised concerns about the
$10.5 million Medline distribution center project in Rogers.
Medline's contractor, California -based Panattoni Construction, used workers and subcontractors
from as far away as Texas and Arkansas, according to the council.
In a statement, Medline said that it simply went with the lowest -cost qualified bidder and that 16
local contractors were hired to work on that job.
The Rogers project received a $240,000 subsidy from the city.
In Carver, Maluchnik said the contractor is paying "around $20 an hour" to the temp agency for
low -wage workers, and "if they paid $20 an hour to Carver County people who are unemployed
and have those job skills, I think that would be a better situation."
Mackey agrees.
"We have approximately 900 building tradespeople that live around the city of Carver, and they
were hoping to get off unemployment and get work," he said. "And Fleet Farm gave it to an
outstate contractor."
Rob Arrieta, a recently unemployed member of Local 563, said he lives about 10 minutes from
the Fleet Farm construction site. He does everything from pouring concrete to putting up
scaffolding.
Arrieta said his 20 -year career in the building trades includes a gig on the Interstate 35W bridge
project in Minneapolis, where he put in 12 hours on his shortest day of work.
Asked about the labor situation on the Fleet Farm job, he said it's frustrating that some people
are "working for basically peanuts."
"I don't know how anybody could work for $7 an hour," Arrieta said.
Mackey said the union has been distributing leaflets at Fleet Farm stores to spread the word
about its concerns, and put up a "shame on you" banner at the construction site.
The new 255,000- square -foot Fleet Farm store is scheduled to open in summer 2012. The
project also includes a convenience store and car wash.
Labor concerns aside, Maluchnik, the county commissioner, said the project is good for the area.
"We are very excited they are coming here," he said. "I am a customer. I enjoy shopping at their
stores, and I am not the only one excited about it. I think the city of Carver deserves some
kudos for their work in bringing them to Carver County."
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