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HomeMy WebLinkAbout06-26-12City of Lakeville Economic Development Commission Meeting Minutes June 26, 2012 Marion Conference Room, City Hall Members Present: Comms. Matasosky, Starfield, Tushie, Smith, Brantly, Schubert, Emond, Longie, Ex- officio member Mayor Mark Bellows, Ex- officio member City Administrator Steve Mielke. Members Absent: Comm. Vlasak. Others Present: David Olson, Community & Economic Development Director; Adam Kienberger, Economic Development Specialist; Rob Smolund, MCCD; Lee Hall, MCCD. 1. Call Meeting to Order Chair Matasosky called the meeting to order at 4:30 p.m. in the Marion Conference Room of City Hall, 20195 Holyoke Avenue, Lakeville, Minnesota. 2. Approve May 22, 2012 Meeting Minutes Motion 11.12 Comms. Tushie /Smith moved to approve the minutes of the May 22, 2012 meeting as presented. Motion carried unanimously. 3. Presentation on Proposed "Open to Business" Program Rob Smolund and Lee Hall from the Metropolitan Consortium of Community Developers (MCCD) made a presentation on the MCCD Open to Business program. MCCD provides technical counseling and financing for small businesses in the Twin Cities. The EDC discussed the program and several members inquired about the sources of capital that MCCD lends to small businesses. Mr. Hall stated that MCCD partners with local banks to finance deals along with financing received from a variety of sources including grants, national banks, and federal dollars. Comm. Tushie asked about the standard loan term issued by MCCD. Mr. Hall responded that the term can vary based on market needs but typically a loan would be between 3 -10 years at slightly higher than market rate interest rates. The goal of the program is to drive financing to traditional lending sources, but they are able to provide financing to higher -risk businesses or projects that aren't able to secure traditional financing. Economic Development Commission Meeting Minutes June 26 2012 EDC members asked about measuring the benefits to Lakeville by partnering with MCCD and how they track their interactions with prospective businesses. Mr. Smolund responded that the benefits will be related to the marketing of the program for Lakeville businesses. He also went on to discuss MCCD's business tracking and funding reports that show how many businesses are assisted and where they are located each year. These also include demographics of the clients that receive technical assistance along with a business survey conducted every five years to measure the successes of the businesses.' Chair Matasosky and Comm. Smith asked how the City of Lakeville can "sell" this service to the business community to make it an effective tool. Comm. Longie how we can market the program to existing businesses as well. Mr. Smolund suggested that you involve the "top people" in the community who would have contact with entrepreneurs or others looking to start a business. This could range from local bankers to the Chamber and other business groups. Mr. Hall stated that reaching existing businesses is actually even easier as success stories can be used as testimonials to tout the program to the existing business community. Comm. Starfield inquired about the renewal rate of the cities that have partnered with MCCD in the past. Mr. Hall responded that to date every city or regional organization that has partnered with MCCD has renewed and remained a partner. Comm. Schubert asked if MCCD works with the SBA. Mr. Hall noted that they work with a wide variety of business assistance groups including the SBA, SCORE, DEED, and Women Ventures among others. Mr. Olson discussed the proposed source of old DEED funds the City has that would be used to fund its membership portion in Dakota County with MCCD. The City's direct cost would be around $7,500. He added that you wouldn't be able to get even a fraction of this type of service from a different group for that cost. Comm. Brantly added that it will be key to market this program to the local banks. Comm. Starfield inquired about using municipal liquor funds to pay for this business development activity. Mr. Olson responded that it is currently being proposed to utilize old DEED funds the City has that is to be used for a business loan program. These funds are more restrictive than liquor funds and this program meets the intent of the old DEED dollars. Mr. Mielke added that the City Council has discussed using liquor funds for economic development activities in the past. 2 Economic Development Commission Meeting Minutes June 26 2012 Comm. Tushie concluded that there could be a negative perception of using liquor funds for this type of service. Liquor funds already do a good job of lowering the overall tax burden for the City. Motion 12.12 Comms. Smith /Brantly moved to recommend to City Council to authorize funds to participate in the MCCD program and work on a marketing strategy to successfully implement it. Motion carried unanimously. 4. Update on Business Marketing Strategy Implementation Project Mr. Kienberger provided an update to the EDC on the Marketing Strategy. It was noted that internal website and branding development will be ready sometime at the end of July. Comm. Brantly noted that the Marketing Partners group continues to be very positive and open to collaboration on joint marketing efforts. 5. Update on Park Dedication Ordinance Changes Mr. Mielke reviewed a memo handed out at the EDC meeting prepared by consultant Dan Licht of TPC. The memo outlined options for calculating commercial and industrial park dedication fees that were discussed at the June 25 City Council work session. The City Council requested input from the Parks, Recreation and Natural Resources Committee along with the EDC prior to proceeding. Mr. Mielke reviewed the consultant's recommended approach of an appraisal consultation for determining land values for calculating park dedication fees for new commercial and industrial plats. Comm. Tushie noted that state law states that the benefit must be demonstrated of the fee paid. Mr. Mielke responded that a legal challenge has required the City to review the park dedication rates and process used for calculating them. Chair Matasosky asked about granting the platting party the opportunity to choose where the park dedication fee is used or if it can be used for onsite park improvements. Comm. Smith stated that park dedication is for the City to build City parks for everyone to use. Comm. Tushie suggested disclosing the "real cost" for the park dedication fees during a development and then reduce that cost to incentivize new industrial development. Comm. Brantly agreed that it would be good to use fee reductions as a way to incent industrial development. 3 Economic Development Commission Meeting Minutes June 26 2012 Chair Matasosky stated that park dedication fees need to be reduced for the City to remain competitive and that he wouldn't support any fee increases. Mr. Mielke responded that this is still just the introductory portion of the process. A rough proportionality needs to be calculated to establish valuation of commercial and industrial property so that an equitable fee can be established. The recommended method is to conduct an appraisal consultation that can be updated as the City Council chooses. He added that the City Council would set the fee based on the formula, but can always choose to lower it. Comm. Tushie advocated for affordable housing developments to have a 0% park dedication fee. Mr. Mielke concluded the discussion by stating that the City Council will be discussing this issue again in July. 6. Director's Report Mr. Olson reviewed the Director's Report. He highlighted the Niakwa Village Housing Improvement Area project which the EDC noted was a very positive project for the City. 7. Adjourn The meeting was adjourned at 6:25 p.m. Respectfully submitted by: Adam Kien erge ecording Secretary Attested to: f R. T. Brantly, Secretary