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08-26-14
El AGENDA Economic Development Commission August 26, 2014 — 4:30 p.m. City Hall, Marion Conference Room 1. Call to order 2. Approval of July 15, 2014 minutes 3. Preliminary Review of Tax Increment Financing Application from BTD 4. Review of Dakota County's Proposed Tax Increment Financing Policy Revisions 5. Update on 2014-16 Strategic Plan for Economic Development Work Program and Discussion of Market Analysis Approach 6. Directors Report 7. Adjourn Attachments - July 2014 Building Permit Report Hy -Vee planned to be built in Lakeville, SunThisWeek 8/14/2014 State loses 4,200 Jobs in July, Minnesota News Release, 8-14-2014 Item No. a CITY OF LAKEVILLE ECONOMIC DEVELOPMENT COMMISSION MEETING MINUTES July 15, 2014 Chair Starrield called the meeting to order at 4:30 p.m. in the Marion Conference Room at City Hall. Members Present: Comms. Starfield, Matasosky, Smit%ongie, Emond, Tushie, Julius, Collman, Ex -officio member Interim City Admi lydt ,Allyn Kuennen, Ex -officio member Lakeville Area Chamber of Commerce Exettire Director Todd Bornhauser. Members Absent: Mayor Matt Little, Comm. ,jja Others Present: David Olson, Communj 'e Economic Develop'. nt Director; Zach Johnson, City Engineer; Penny Brevig, mg Sectary. 2. Approval of May 27, 2014 eeting minu { PYA, Motion Comms. Smith' ismcved to' rove the minutesof the May 27, 2014 meeting a ited. Mots "harried unanimously. 3. Review Prop ..; ilf jo the Ke, oo fail/Cou :toad 50 Economic r Developme�rt d En6`ering Stu v :=' Mr. Olson revi' d the p'I+csal for th en 00 "I/County Road 50 Study. He stated that the exert 'on w#:include Ke ` ood Tram,\ etween 185th Street and Dodd Boulgv he u e, 'll include .four lane divided roadway, improved int e ct10 rations � - I P safe tt�'1VIr. Olson indicated that additional �f-way wil a to #cqu; m truct these improvements. He noted that segment o . nwo-'-Trail lie F en Ipava Avenue and Dodd Boulevard, which�udes exists apusi�eses ;to the northeast and railroad tracks to the south wes�tar jl be the ea that t� °County and City are proposing to conduct a study and mate the QentiaF impacts to businesses, driveway access, and issues and nekof the bjnesses. City Engineer Zach''JQhn�on was in attendance to discuss the process and answer any questions that th6 bC members may have. Mr. Johnson presented a Power Point presentation which included the goals of the study, the specific study area, what discussions/meetings will take place with the commercial property owners in the area, and the project teams, including Hoisington Koegler Group, Inc., SRF Consulting and Springsted. Mr. Olson commented that the City of Lakeville has worked with these consultants previously on various projects. Springsted has been the City's fiscal advisors for many years. A gentleman in the audience asked Mr. Johnson if the City/County has considered using concrete rather than asphalt for the new road. Mr. Johnson commented that Economic Development Commission Meeting Minutes, May 28, 2014 Page 2 they haven't gotten to that level yet. The County is aware of this option and it will be considered. A discussion amongst the EDC members included time line, relocating businesses, what level of communication with the businesses had occurred already, and how this will be paid for. Mr. Olson stated that this will go to the City Council on August 4th for authorization for the project and then it will take a couple months from there to get feedback from the property owners. Hoisington Koegler Group will look at the possibilities of whether any of the businesses will want to be relocated. Mr. Johnson indicated that during the summer o the City/County met with the businesses to; answer questions about the roundabout at 1 '�) from those discussions was that the b�l�e continue communication. 4',,, Mr. Olson commented that for road A�_ the paid by the County and 45% paid by Mr. Olson informed the EDC w the City ha " i. residential homes along Count r . 50 and of E purchasing their homes. \; . Mr. Olson co Mr. Johnson st' .. that t forward_Q.•uvorking - !, the 4. MAi iisha Pa6kiihiiinal P` i there usrnesses are and Court to - M4VV l[ IYIV11 f.A letter "it"Athe amount-'�;s 42 , indicate fat the gra `':.awar v91 $347,520 Ih'ja capital i ;stmer ground breakJs being ' nned 3, as .part of the corridor study, ,ss the long term version and ► hty Road 50. The feedback wai to stay in touch and .t share ha"1ways been 55% w idy purchased ''couple of the ;have contacted the City about is project progresses. 0 about the project and look this work. Pa i had received their notice of approval for the'Job Creation Fund Program (JCF). He isted of a $75,000 job creation award and ward. Mr. Olson commented that a project for August. Mr. Bomhauser asked if this program is for existing businesses or new businesses. . Mr. Olson stated t� �, ahis program provides financial incentives to new and expanding businesses that meet certain job creation and capital investment targets. 5. Update on 2014-16 Strategic Plan for Economic Development Work Program Mr. Olson provided an update on the Strategic Plan and noted that several items were currently in process. Maxfield Research and Dakota County CDA staff presented the recent housing study findings to the City Council at their June 23rd Work Session. Mr. Olson indicated that EDC Member Gary Tushie attended that meeting and asked him for his thoughts. Comm. Tushie stated that he thought the Council had 6. Economic Development Commission Meeting Minutes, May 28, 2014 Page 3 asked some good questions, but he felt they were not in total support of the work force housing. Mr. Olson stated that at the City Council meeting Mark Ulfers from the Dakota County CDA tried to make a clarification of affordable housing and that it is not all Section 8 housing. The EDC continued a discussion of what type of housing Lakeville needs and that it's all demographic and a life style choice today and that it is an economic development issue not just a housing issue. They discussed where the best location would be for this affordable housing (most likely along the corridors where there is public transportation). They felt that people like to live in close proximity to where they work and if people cannot find housing -* Lakeville that they can afford, they may not choose to work here. Mr. Olson commented that there will be 'further discussions regarding senior, affordable, and multi -generational housing ,,in -Lake , p There tends to be a misconception of the types of build' that the CDA and this should be clarified. Mr. Olson commented that it is an°ted tha'rogress on se goals will increase considerably when the City's nt ,gnomic Develop Specialist starts.. Director's Report Mr. Olson review_ Director's po explain, he comes up with his numbers for hls.} IN i rmit repo u a fig`.,, �=3�: Mr. Olson indican Ahat the`tl ity receive an applic bn and plans for a new FedEx Freight , 'Id' in ,First;ark Lakeville, locate&by the Uponor building. It will crea# tely s:.:F dEx Frel� i will have to preliminary and final plat ttl`property.:= Y x Mr.7ta stated that' Cify mhas hired a new Economic Development Specialist and he tart on JUI to a r _ Mr. Olson thead Toddornhauser for his involvement over the past 12 years. Mr. Bornhauser nked'Y Olson and indicated that it's been a real honor to be a member of the ED ., a 7. Adjourn Meeting adjourned at 5:30 p.m. Respectfully submitted by: Penny Brevig, Recording Secretary Memorandum Item No. •3 City of Lakeville Community & Economic Development To: Economic Development Commission From: David L. Olson, Community & Economic Development Director Copy: Allyn Kuennen, Interim City Administrator Rick Howden, Economic Development Specialist Date: August 22, 2014 Subject: TIF Application for Proposed BTD Expansion The City recently received an application for Tax Increment Financing (TIF) from BTD (see attached application). BTD started their Lakeville operations in 2005 and provides custom metalwork services to some of the world's top brands including Polaris, GE, Honda, Kawasaki, 3M, John Deere, and Toro, to name a few. BTD has experienced considerable growth in recent years and currently occupies 317,000 square feet in three separate buildings in Airlake Industrial Park and has approximately 215 employees in Lakeville. BTD currently leases 193,000 SF in the former Toro Warehouse building along Cedar Avenue. The owner of this building is proposing a 200,000 square foot expansion of this building to allow BTD to consolidate two of their production and warehouse operations and would result in the company occupying a total of 412,000 square feet. BTD is estimating this proposed expansion will result in the creation of an additional 100 jobs in the first two years of operations. The total estimated cost of this proposed expansion is $14.2 million. Company President Paul Gintner will be at Tuesday's meeting to describe BTD's recent as well as anticipated growth. BTD is requesting TIF assistance to offset some of the estimated $4.3 million in TIF eligible costs associated with the project. It is anticipated that with Tax Increment Financing, while we are waiting on specific information on the actual wage levels of the jobs to be created, BTD representatives have indicated that all new jobs to be created will exceed the $13 per hour minimum referenced in the City's TIF Policy. Staff has determined that the proposed project is consistent with the City's TIF policy. Recommended Action: Staff is requesting that the EDC recommend to the City Council that they proceed with preparation of a TIF Plan for the creation of a new TIF District for the proposed BTD expansion. If the Council concurs with this recommendation, the draft TIF plan and proposed level of assistance will be brought back to the EDC for a recommendation. Mr. David Olson Community and Economic Development Director City of Lakeville 20195 Holyoke Ave Lakeville, MN 55044 RE: Proposed Expansion at 21350 Cedar Ave — Request for Assistance Dear Mr. Olson, August 1, 2014 Thank you again for our earlier meeting to discuss BTD's proposed consolidation and expansion of our Lakeville facilities and operations. Since we met, our staff has been working to obtain corporate support and has been given direction to proceed with the project design, engineering, and obtaining the City of Lakeville's support. BTD's Lakeville operations began in 2005 with the purchase of Performance Tool & Die and the opening of a production and warehouse operation in the old Performance Office Papers building. In 2013, BTD also leased a large portion of the old Toro building, expanding both production and warehouse operations. BTD now occupies approximately 317,000 sq. ft. in three separate buildings within Airlake Industrial Park, employing nearly215 employees in Lakeville. BTD would like to consolidate the two Lakeville production and warehouse operations (eliminating multiple logistical moves), introduce an additional value added service (painting), and eventually consolidate manufacturing and warehousing activities presently located in Otsego, MN to the expanded "Toro" building. Included for your review and comment is supporting information and documents that explain our intended expansion at 21350 Cedar Ave. Currently, we are tenants of this facility and lease 193,000 sq. ft.; we would like to expand the existing building by approximately 200,000 sq. ft. Our total leased area would be approximately 412,000 sq. ft. Thank you, David, and the entire City of Lakeville, for your support over the years. We are extremely satisfied with our choice to locate in Lakeville and continue to look for ways to expand our operations here. We are anxious to move forward with this project and are prepared to answer any questions you may have. Respectfully submitted, Paul Gintner Dave Welte President and President Vice President of Finance Cc: James Fulford, Fulford Group, LLC Jack Matasosky, APPRO Development, Inc. . I I , , '" - " � ", " � t �t . , 11 CITY OF LAKEVILLE TAX INCREMENT FINANCING APPLICATION PROJECT: BTD Manufacturing, Inc./Fulford Group LLC. — 21350 Cedar Ave Expansion 1. Business Name: BTD Manufacturing, Inc. Address: 1111 13th Ave SE, Detroit Lakes, MN 56501 Telephone: 218-846-2836 Contact: Dave Welte, Vice President of Finance 2. Brief description of the business: BTD first located operations in Lakeville in 2005 by acquiring Performance Tool and Die Company. Throughout the years manufacturing operations and warehouse space have increased to 96,000 sq ft In 2013 BTD leased an additional 193,000 sq. ft. in the former Toro facility and desires that this building be expanded to consolidate some of the operations 3. Present ownership of the site: Airlake Development, Inc., Daniel Regan. A purchase agreement is in place to acquire the additional land that the facility will be built on 4. Proposed project: Building square footage, size of property, description of buildings — materials, etc.: • Additional land — approx. 14 acres. • Total building expansion(s) — approx. 199,615 sq. ft. • Building area to accommodate company's — painting, manufacturing and warehousing/distribution activities. • Wall materials to be architectural precast concrete wall panels with pre -colored finishes. 5. Total Estimated Project Costs: a. Land Acquisition b. Site Development c. Building Cost d. Soft Costs $ 1,800,000.00 $ 2,349,147.00 $ 8,007,142.00 $ 1,438,723.00 12.Type of Assistance Requested (Upfront or Pay -as -you -Go): Pay -as -you -Go 13. Name & Address of architect, engineer, and general contractor: Civil Enqineer — Jacobson Enaineers & Survevors 21029 Heron Way, Lakeville, MN 55044 Architect/G.C. - APPRO Development, Inc. Jack Matasosky 21476 Grenada Ave, Lakeville, MN 55044 14. Project construction schedule: a. Construction Start Date October 2014 b. Construction Completion Date July 2015 c. If phased project: 2014 Year 30% Complete 2015 Year 100% Complete 15. State specific reasons why assistance is necessary for the project (the "but for" test). The Project, without tax increment assistance, is not feasible as rental rates would far exceed "Market rates". 16. Please indicate how the project would meet one or more of the following: Economic Development goals; creation of jobs that pay wages adequate to support households, job retention, or tax base expansion. Existing Lakeville jobs Retained) 215 Projected new jobs (First two years of operation) 100 Real Estate Tax Impacts - Present (2014) $239,466.14 Projected (Future) $599,280.14 17. Municipal Reference (if applicable). Please name any other municipalities wherein the applicant, or other corporations the applicant has been involved with, has completed developments within the last five years. BTD Manufacturing has a large presence in Detroit Lakes, MN: 254,000 sq. ft., 480 employees. BTD also has facilities in Washington, Illinois and Otsego, MN. 3 ADDITIONAL DOCUMENTATION AND CHECKLIST Applicants will also be required to provide the following documentation. All personal financial information will be kept private and confidential. ❑ 1. Written business plan or a description of the business, ownership/ management, date established, products and services, and future plans. ❑ 2. Two year financial projections, or if housing project, or leased space, include a 10 -year operating pro -forma. Please refer to the Ottertail Corporation annual report posted on the company web site; ottertail.com/annual.cfm . ❑ 3. Letter of commitment from other sources of financing, stating terms and conditions of their participation in the project. ❑ 4. Initial nonrefundable application fee of $500, with a $5,500 fee to follow should the request for assistance proceed. In addition to defraying the cost of staff time, the fee will be used to pay costs associated with processing this request for financial assistance such as legal, engineering and financial analysis. The City reserves the right to stop the processing of the request until additional fees are paid should the original amount be insufficient to pay such costs. That portion which remains unspent, if any, will be returned only if the project is denied approval. ❑ 5. Attach the following documentation: Part 1— Corporation/Partnership Description Part 2 — List of Shareholders/Partners Part 3 — Description of Project Part 4 — But For Analysis Part 5 — List of Prospective Lessees Part 6 — Legal Description, Property Identification Numbers, maps of the project area, and project renderings Part 7 — Public Purpose Narrative Part 8 — Sources & Uses of Funds — Additional Information The undersigned certifies that all information provided in this application is true and correct to the best of the undersigned's knowledge. The undersigned authorizes the City of Lakeville to check credit references, verify financial and other information, and share this information with other political subdivisions as needed. The undersigned also agrees to provide any additional information as may be requested by the City after the filing of this application. Applicant Name lA ? C( LAl Date By '-o '1k_ Its 4 i= Pry a r<—(* 0 V0363Milo 1:0960L52321:000217488111' J ------- --- I=- 1 36328 INC. ANCIJORaBANK. APPRO DEVELOPMENT —nkcom 1 • 0-" 21476 GRENADA AVENUE www!ara An&.orUne!952zffl 83 LAKEVILLE, MN 55044 75-1523-960 I� � PH, (952) 469-2171 36328August 1, 2014 $********500.00 m _ o DATE AMOUNT Pay: hundred dollars and no cents a m PAY TO THE City of Lakeville 8 ORDER OF20195 1 Holyoke Avenue Lakeville, MN 55044 V0363Milo 1:0960L52321:000217488111' J BTD Introduction Presented to: The City of Lakeville Date: August 1St, 2014 TD BTD BTD Information What does BTD do? Custom Metalwork for Some of the World's Top Brands BTD provides a complete spectrum of custom metalwork services to some of the world's top brands. These services include metal fabrication, forming, welding, tool & die work, machining, powder coating, prototyping, laser cutting, robotic welding, stamping, cutting, tubing; CNC, EDM and much more. BTO BTD Information mrn *fin Be our customers "first choice" by making "'It" right and making 'it" fast. R-Tn miss* lor BTD is an aggressive growth oriented manufacturer of quality products. We are in business to deliver superior service that exceeds our customers' needs. provide growth opportunities for our employees and enhance profitability. First-class Metalwork For World-class Brands BTD Information BTD Values Integrity We conduct business responsibly and honestly. Safety We provide safe workplaces and require safe work practices People We build respectful relationships and create an environment where talented people thrive. Performance We strive for excellence. act on opportunity and deliver on commitments Community We improve the communities where we work and live. BTD History 1979 — Founded by Earl Rasmussen and Paul White (Named Bismarck Tool and Die) 1980 — Moved to Detroit Lakes, MN 1995 — Otter Tail Corporation acquires BTD Mfg AN#0- fERTAILC0MF'AW 2002 — BTD acquires Precision Machine 2005 — BTD acquires Performance Tool and Die (Lakeville) 2005 — Opens New Production Plant (Lakeville) 2007 — BTD acquires Pro Engineering (New Hope) 2008 — BTD acquires Miller Welding and Iron Works 2011 — BTD Rebrands Organization to align operations for increased efficiencies 2013 — BTD adds 100,000 square feet in Lakeville MN BTD Our Customers CPOLRRIS ' ' UTEREX. i CORACO Ca�r�dner Bobcat 11 Tmnver w HONDA Ma—clDcon Ka vasak r rr x 3M -il AECOLAB -�� Your AgrKutturr• Comp.,n� JOHN DEERE Qw s KOMAI"SUCA—r SIEMENS i r Pentair„,. r.• I-**. NOW BTD Locations Employees: 971 Sq• ft.: 800,000 2013 sales: $164 million ,601TERTAIL CORPORATION AoTrERTAILI, OUR COMPANIES 'CORPORATION FElectric Manufacturing and Infrastructure 07ikk1rA-1 TO. PLASTICS BTO NASDAQ Global Select Market: OTTR VAY1.1 I C 11 -0 FOLEY COf11A4 Y s6wee ,9i t c • I' I I' 1 All operating companies operate independently, but with disciplined �. corporate oversight. A E V E N I A BTD Capabilities ❑ R&D ❑ Stamping ❑ Tooling ❑ Fabrication ❑ Tubing ❑ Welding ❑ Finishing ❑ Assembly ❑ Machining ❑ Quality Control ❑ Warehouse/Packaging Complete BTD Equipment List at link below: http://www.btdmfg.com/capabilities—processes/full—equipment list/ =Von 0 011:41W V Silvis$ .e r twil. nw r K UUI1. k aTo "c:omniete somt-ion sunnlif; � I 100010 �4 All Ay NA Other 6% Lawn & Garden 9% Energy 12% Service (Teir 2) 0 Electron $ Tooling3% 5% x ma Construction 13% Fitness 1% % of Business by Market 2013 Recreation 32% Agriculture 16% ■ Recreation ■ Agriculture ■ Construction ■ Energy ■ Lawn & Garden Other Tooling Electronics Service (Teir 2) Fitness Stable company Vendor Consolidation BTD Strengths TD 9 �� Mndwwi�n OTD Original quoted After cost reduction version from BTD av F TOOLING SAVINGS: 513,M,00 YEARLY PART SAVINGS: $241,570.00 'CMipee awed "Www eed low aeeb am" "an 1�: NuPMMsn bewq Value -Add Engineering Flexibility/Responsiveness qw BTD Part Pictures �s� R most • •o' ' 4 � p +ems ffi� • � �t '� 49 , w - ! fir:. •.: „� � � ? • ���• �� • me 1 4' k�, 1 -400 « 41, fe LOW t .x ate- _76 44 .. Atow.M �t ► �� 4_ y .. y #A Thank you for viewing our presentation'. Lease Study Analysis With/Without T.I.F. Impact August 1, 2014 BTD Manufacturing — Additional space requirements: Office 14,400 sq. ft. Truck/dock/loading area 2,240 sq. ft. Warehouse/manufacturing 182,975 K. ft. Total 199,615 sq. ft. Market Rates — "Target" Office 14,400 sq. ft. @ $8.00/sq. ft. (mid point) $115,200.00 (range $7.50 — $8.50/sq. ft.) Truck/dock/loading area 2,240 sq. ft. @ $5.50/sq. ft. (mid point) $ 12,320.00 (range $5.00 — $6.00/sq. ft.) Warehouse/manufacturing 182,975 sq. ft. @ $4.20/sq. ft. (mid point) $768,495.00 Approx. Net Rent/Year $896,015.00 (Target rate) Actual Project Costs/lease capitalization rates: Land $ 1,800,000.00 Site Development Costs $ 2,349,147.00 Building Costs $ 9,712,550.25 Finance Costs $ 336,624.00 $14,198,321.25 (Estimated) Lease Capitalization (using actual costs): $14,198,321.00 @ 7.8% CAP rate = $1,107,469.00/year (lease rate without T.I.F.) $ 1,107,469.00 (actual lease rate) - $896,015 (target rate) _ $211,454.00 (gap) $ 211,454 - 7.8% CAP rate = $2,710,949.00 (project cost gap) Lease rate with T.I.F. impact: EMV — upon completion of project 14 acres land — rezoned to 1-2, approx. $1,800,000.00 Building Improvements — shell $8.007.142.00 Est. EMV = $9,807,142.00 Total EMV does not reflect site improvements specific to truck yard, storm ponds, etc... Estimated taxes upon completion $372,671.00/year Present land tax — Estimated (14 acres) $ 12,857.00/year Net increment/year $359,814.00/year Estimated TIF available to developer/year — Approx. $201,496.00 (year 1) Effective net rent (years 2-9) with T.I.F. impact: $1,107,469.00 - $201,496.00 (year 1) _ $905,973.00/year (Approx. $4.54/sq. ft./year) T.I.F. impact and operational efficiencies bring net rents close to industry market rate standards. �.+•�•��.+• NVId 3115 1d3ON07 aLIL-NL-ClL �xv. lKawaacaaa LYO!! 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Disclaimer. Map and parcel data are believed to be accurate, but accuracy is not guaranteed. This is not a legal document and should not be substituted for a title search, appraisal, survey, or for zoning verification. Thursday, July 24, 2014 Dakota County, MN Page 1 of 1 Property Card Owner Information Fee Owner AIRLAKE DEVELOPMENT INC Mailing Address 1875 HWY 36 W STE 200 ROSEVILLE MN 55113 Property Address Address Municipality LAKEVILLE Parcel ID Number 22-03400-26-016 2014 Land Values (payable 2015) 2014 Building Values (payable 2015)* 2014 Total Values (payable 2015)' 2013 Total Values (payable 2014)* Net Tax (payable 2014) $29,589.36 Assessor Valuation Taxable $2,404,000.00 $0.00 $2,404,000.00 $2,201,800.00 Property Tax Information Special Assessments (2014) $0.00 Estimated $2,404,000.00 $0.00 $2,404,000.00 $2,201,800.00 Total Tax & Assessments (2014) $29,589.36 " Manufactured Homes Payable the Same Year as Assessment. Disclaimer: Map and parcel data are believed to be accurate, but accuracy is not guaranteed. This is not a legal Friday, May 16, 2014 Dakota County, MN Page 1 of 2 Parcel Information Last Qualified Sale Total Acres 32.22 Sale Value $0.00 R/W Acres 3.83308063 Uses AG Water Acres Plat SECTION 34 TWN 114 RANGE 20 Lot and Block 29.20 ACRES 34 114 20 ALL S OF RR OF NW 1/4 EX S 650 FT & EX N 630 Tax Description FT OF S 1280 FT OF W 1093 FT EX W 1309.70 FT LYING S OF STH 50 SUBJ TO PARCEL 3 DAKOTA COUNTY RNV MAP #166 2014 Building Characteristics (payable 2015)* Building Type Year Built 0 Bedrooms Building Style Foundation Sq Ft Bathrooms Frame Above Grade Sq Ft Garage Sq Ft Multiple Buildings Finished Sq Ft Other Garage Miscellaneous Information School District Watershed District Homestead Green Acres Ag Preserve Open Space 192 VERMILLION RIVER NON HOMESTEAD 2014 Land Values (payable 2015) 2014 Building Values (payable 2015)* 2014 Total Values (payable 2015)' 2013 Total Values (payable 2014)* Net Tax (payable 2014) $29,589.36 Assessor Valuation Taxable $2,404,000.00 $0.00 $2,404,000.00 $2,201,800.00 Property Tax Information Special Assessments (2014) $0.00 Estimated $2,404,000.00 $0.00 $2,404,000.00 $2,201,800.00 Total Tax & Assessments (2014) $29,589.36 " Manufactured Homes Payable the Same Year as Assessment. Disclaimer: Map and parcel data are believed to be accurate, but accuracy is not guaranteed. This is not a legal Friday, May 16, 2014 Dakota County, MN Page 1 of 2 Item No. � City of Lakeville Community & Economic Development Memorandum To: Economic Development Commission From: David L. Olson, Community & Economic Development Director Copy: Allyn Kuennen, Interim City Administrator Rick Howden, Economic Development Specialist Date: August 22, 2014 Subject: Proposed Amendment to Dakota County's Policy on Tax Increment Financing Dakota County staff has recently distributed the attached proposed revisions to the County's Policy on Tax Increment Financing (TIF). The proposed policy revisions were discussed at a meeting of Community and Economic Development Directors from Dakota County cities and Dakota County Taxation Manager Amy Koethe on August 21St. Additional information from that meeting will be presented at the EDC meeting. While a number of more technical changes are being proposed that deal with the definitions for affordable housing and other more technical issues, the most significant policy change is the elimination of the County supporting any TIF projects that provide a net increase in livable wage jobs. This change is contained in the Policy Statement in the first paragraph of the Policy. As a result, the County will not support any Economic Development TIF projects that either create or preserve livable wage jobs. This has already been the County's practice for many years because Economic Development TIF Districts are not listed in the first sentence of the policy. This practice was recently confirmed with the attached resolution that was adopted by the County Board during their review of the new Economic Development TIF District that was created for the proposed Menasha expansion in Airlake Industrial Park. Recommended Action : Staff is requesting that the EDC provide comments regarding the proposed County TIF Policy amendments that can be forwarded on to the City Council. Policy 8002 TAX INCREMENT FINANCING Published 09/16/02 Revised: June 2014 POLICY STATEMENT Dakota County w&Mav support housing, redevelopment, renewal and renovation and soils condition TIF districts that increase or have a neutral effect on the number of affordable housing units in the community, clearly demonstrate that they meet the "but for" test, and meet at least one of the following: 1. Provide affordable housing 2. Include livable community housing and provide mixed use 3. Remove blight conditions and/or contamination DEFINITIONS Affordable Housing: Rental housing that must meet all of the requirements for a low income housing credit under section 142(d) of the Internal Revenue Codes, regardless of whether the project actually receives housinq credit, including maximum income and rent limits established annually by the U.S. Department of Housing and Urban Development (HUD). Owner occupied housing that must meet both of the followina: (1) the definition of "housina proiect" under Minnesota Statutes 469.1761 Subd. 2: 95 percent of the housing units must be initially purchased and occupied by individuals and families whose household income is less than or equal to the income requirements for aualified mortgage bond projects under Section 143(d) of the Internal Revenue Code, and (2) the Dakota County policy requirement that 50 percent of the housing units must be initially purchased and occupied by individuals and families whose household income is less than or equal to 80 percent of the area median income (AMI) as determined annually by HUD. Maximum initial sale price limits will be enforced to ensure homes are affordable to homebuyers at these incomes. Blight conditions: Areas that contain (or conditions that cause) high percentages of dilapidated buildings or otherwise deteriorating and substandard structures. (Minn. Stat. � 469.174. subd. 10). "But -For" Test: Shows that. in the opinion of the municipality: (i) the proposed development or redevelopment would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future: and 00 the increased market value of the site that could reasonably be expected to occur without the use of tax increment financing would be less than the increase in the market value estimated to result from the proposed development after subtracting the present value of the projected tax increments -he of 50% Gf median C -IF ., M Rental housing that must meet all of the requirements for a low income housing credit under section 142(d) of the Internal Revenue Codes, regardless of whether the project actually receives housinq credit, including maximum income and rent limits established annually by the U.S. Department of Housing and Urban Development (HUD). Owner occupied housing that must meet both of the followina: (1) the definition of "housina proiect" under Minnesota Statutes 469.1761 Subd. 2: 95 percent of the housing units must be initially purchased and occupied by individuals and families whose household income is less than or equal to the income requirements for aualified mortgage bond projects under Section 143(d) of the Internal Revenue Code, and (2) the Dakota County policy requirement that 50 percent of the housing units must be initially purchased and occupied by individuals and families whose household income is less than or equal to 80 percent of the area median income (AMI) as determined annually by HUD. Maximum initial sale price limits will be enforced to ensure homes are affordable to homebuyers at these incomes. Blight conditions: Areas that contain (or conditions that cause) high percentages of dilapidated buildings or otherwise deteriorating and substandard structures. (Minn. Stat. � 469.174. subd. 10). "But -For" Test: Shows that. in the opinion of the municipality: (i) the proposed development or redevelopment would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future: and 00 the increased market value of the site that could reasonably be expected to occur without the use of tax increment financing would be less than the increase in the market value estimated to result from the proposed development after subtracting the present value of the projected tax increments for the maximum duration of the district permitted by the plan. The requirements of this item do not apply if the district is a housing district. (Minn Stat. � 469.175, Subd. 3, b, (2)), Contaminatedion: The presence of hazardous substances, pollution, or contaminants that require removal or remedial action Livable Community. A community that is designed with 1) mobility options such as transit, walk, bike or drive, 2) protects and enhances natural resources, 3) Provides housing choices including single -family homes, condominiums and apartments in a variety of architectural styles and prices to meet the needs of people of all ages and incomes, and 4) a plan for mixed uses such as locating housing, workplaces, shopping, daily services, schools, parks, civic places and public facilities together in an area. -thma-blas 14Vage Job. jobs that pay the Minernurn R-RRI-Ial ;aMA-1-1nt of Pid In mt;W ;a hour bar,iG needs, inGluding food, heusiRg, health GaFe, tFaRspe Ratie.n., n-hild- *Fsenal and taxes. Low Income Housing: Housing occupied by persons whose income is at or below 50% of the area median income with rents not exceeding 30% of the 50% area median income. Mixed Use: Developments that include housing, varied by type and prices, integrated with commercial development and places of employment. It includes those developments being accessibility by multiple transportation modes Moderate Income Housing: Housing occupied by persons whose income is at or below 80% of the area median income with housing costs not exceeding 30% of 80% of the area median income. Proiect area: The geographic area in which tax increment revenues may be spent. Project areas are designated by the development authority under the applicable development law, such as the HRA, port authority, economic development authority, or municipal development act. Qualifying Inspection: The inspections performed to document the status of the property to determine that the district meets the criteria as a redevelopment district, a renewal and renovation district, or other TIF district. Redevelopment: Actions taken to improve areas affected by substandard buildings, blight, railroad or tank facilities, as described by Minn. Stat. § 469.174, subd. 10. Tax Increment Financing: A statutory financing tool used to promote economic development, housing, redevelopment, renewal and renovation in areas where it otherwise would not have occurred. TIF enables an authority to "capture" property taxes generated by new development or redevelopment to pay for development expenses. A TIF authority captures the increase in net tax capacity resulting from new development within a designated geographic area called a TIF district. Tax Increment Financing Authority: An authority created pursuant to Minnesota Statutes to administer a tax increment financing district. (See Minn. Stat. § 469.174, subd. 2) Tax Increment Financing District: The geographic area from which tax increments are collected. The development authority defines the area in the tax increment financing plan. A district may be a -contiguous or noncontiguous area within -a project area. (See Minn. Stat. § 469.174, subd. 9) Tax Increment Financing Plan: A plan that must describe the project supported by tax increment financing, project objectives, development programs and activities to be undertaken, type and duration of district being created, parcels included in the district, estimated costs and revenues, impact on other taxing jurisdictions, and other details of the proposal. The TIF plan may be approved by the municipality after the required public hearing is held. (See -Minn. Stat. § 469.175, subds. 1, 4) SOURCE Tax Increment Financing is governed by Minn. Stat. § 469.174-469.17941793 as amended. Dakota County Board Resolution No. 02-40414-_ GENERAL INFORMATION Dakota County must receive sufficient information to be able to determine that the qualifying criteria has have been met. Depending on the type of TIF district, Dakota County requires documentation related to: • TIF plan • qualifying inspections • analysis of net affordable housing impact within the TIF district or project area • average market value of comparable housing in the city or area • estimated financial impact on the county • map(s) of the proposed TIF district and project area • traffic study, if appropriate As provided in state law Minn. Stat. & 469.174.1 a and the Dakota County Transportation Policy Plan, the Dakota County Board of Commissioners shall require the authority to pay all or a portion of the cost of related or required improvements to the county transportation system from increment revenues, if the following conditions occur: 1. The proposed plan would, in the judgment of the county, substantially increase the use of the county transportation system and require construction of road improvements or incur other transportation system costs; and 2. The transportation system improvements are not scheduled for construction within five years under the county capital improvements plan, and, in the opinion of the county, would not be expected to be needed within the reasonably foreseeable future were it not for the tax increment financing district. For projects that are included in the capital improvements plan, the costs of road improvements or other road costs (e.g., traffic controls) which are in the determination of the County the result of a tax increment financing plan or an amendment to a TIF plan, will be subtracted from the County eligible project costs, with the balance of costs divided according to the cost sharing policy of the County Transportation Policy Plan. A County Board resolution is required for any significant deviation from this policy. Dakota County encourages municipalities to furnish TIF plans, or documentation related to the above, at least 45 days prior to the public hearing for the following purposes: 1. To coordinate the timeline of the road improvement cost estimates and the comments from the Dakota County Board. Dakota County reserves the right to identify costs after the public hearing if necessary. 2. To allow for a thorough analysis by all essential county departments and ensuring an appropriate recommendation to the county board prior to the public hearing. a. To assure documentation is received timely. Dakota County encourages municipalities to furnish TIF plans and documentation to the following county offices: i. County Commissioner representing the municipality ii. County Administration iii. Property Taxation & Records Department Director iv. Physical Development Division Director v. Executive Director of Dakota County Community Development Agency Dakota County will indicate its support/non-support for municipal TIF districts via comments in a County Board resolution provided to the city, except when a County Board meeting is not held within the 30 -day response period. If the County Board cannot provide comments by resolution within the 30 -day response period, comments will be provided following Board action. The Dakota County Board must approve or disapprove all CDA TIF Districts. Dakota County encourages municipalities to 1) limit the duration of the district and supports the early decertification of all TIF districts and 2) require that TIF assistance provided in housing districts be repaid at the time the property is sold or transferred if the home appreciates in value. Dakota County will consider a municipality's history regarding compliance with Dakota County's TIF policy and state law in its deliberation. PROCEDURES The Dakota County Property Taxation & Records Department will develop and maintain procedures. 12.3 - RBA.docx Supporting Documents: Previous Board Action(s): Attachment A: Various pages of TIF Plan Attachment B: TIF No. 18 Site Maps Attachment C: Physical Development Memo Attachment D: TIF Policy No. 8002 RESOLUTION WHEREAS, the City of Lakeville submitted the Proposed Tax Increment Financing (TIF) Pian for TIF District No. 18 within Airlake Redevelopment Project No. 1 to Dakota County Property Taxation & Records on March 7, 2014; and WHEREAS, the City of Lakeville established a public hearing date of April 7, 2014; and WHEREAS, Minn. Stat. § 469.175, subd.1a, provides that the Board of Commissioners may require the TIF authority to pay all or a portion of the cost of County road improvements out of tax increment revenue, under certain conditions; and WHEREAS, the County Transportation Department has reviewed the TIF Plan and has not identified any impacts on Dakota County roads; and WHEREAS, Environmental Resources staff has reviewed the property and identified two hazardous waste generators and recommend that due to the age of the existing building, a hazardous building materials survey should be conducted if any renovation or demolition is planned and that, if any wells exist, they should be confirmed before site development commences; and WHEREAS, the Dakota County Community Development Agency has reviewed the TIF Plan, identifying no housing component to this district; and WHEREAS, the Proposed TIF District No. 18 does not meet the criteria for support under Dakota County's policy. NOW, THEREFORE, BE IT RESOLVED, That the Dakota County Board of Commissioners hereby acknowledges receipt of the Proposed Tax Increment Plan for Lakeville TIF District No. 18 in the City of Lakeville; and BE IT FURTHER RESOLVED, That the Dakota County Board of Commissioners hereby finds that Lakeville Economic Development TIF District No. 18 is not consistent with the Dakota County TIF Policy No. 8002. Administrator's Comments: Reviewed by (if required): I@ Recommend Action I@ County Attorney's Office ❑ Do Not Recommend Action IM Financial Services ❑ Reviewed --No Recommendation I@ Risk Management ❑ Reviewed --Information Only ❑ Employee Relations ❑ Submitted at Commissioner Request ❑ Information Technology ❑ Facilities Management County Administrator 3/21/2014 2:21 PM Page 2 -132- 12.3 - RBA.docx DAKOTA COUNTY BOARD OF COMMISSIONERS Review Of Proposed Tax Increment Financing (TIF) Plan For TIF District No. 18 In City Of Lakeville Meeting Date: 3/25/2014 Item Type: Consent -Action Division: Public Services and Revenue Department: Property Taxation and Records Contact: Koethe, Amy Contact Phone: (651) 4384370 Prepared by: Koethe, Amy FlscaVFTE Impact: ❑ None ® Other ❑ Current budget ❑ Amendment requested ❑ New FTE(s) requested Board Goal: Good for Business PURPOSE/ACTION REQUESTED Review of proposed Tax Increment Financing (TIF) Plan for TIF District No. 18 in the City of Lakeville (City). SUMMARY The Property Taxation and Records Department received the Proposed Tax Increment Plan (Attachment A) for TIF District No. 18 on March 7, 2014. The City of Lakeville has scheduled a public hearing for April 7, 2014 to consider the proposed TIF District Plan. TIF District No. 18 (Menasha Packaging Expansion Project) is within Aidake Redevelopment Project No. I. The proposed district is an Economic Development TIF District consisting of one parcel of land that the Menasha Packaging Plant is situated on, and Is located south of County Road 70 and west of County Road 23 (Cedar Ave) in the City. (See Attachment B). The District is being created to prepare the site for the construction of a 123,000 square foot addition to the existing industrial facility. The TIF district parcel Is currently owned by the developer. The County Transportation Department has reviewed the TIF Plan and has not identified any impacts on Dakota County roads (See Attachment C). The site is not adjacent to a County highway and the City has not requested changes to its land use. The county has legal right to cause the reservation of TIF funds for capital improvements (not included in the county's CIP) where such impacts are caused by the TIF development. Environmental Resources staff performed an environmental audit in and around the project area. No record of wells was found. If any wells exist, they should be confirmed before site development commences. Two hazardous waste generators are located on the site. Due to the age of the building a hazardous building materials survey should be conducted if any renovation or demolition is planned on the existing building. The Dakota County Community Development Agency has reviewed the TIF Plan. There is no housing component to this district. Dakota County has adopted Policy No. 8002 (Attachment D) regarding tax increment financing, which has four key tests for county support of a district: 1) The County will only endorse housing, redevelopment, and renewal and renovation districts (economic development districts are not included as an acceptable purpose), and 2) Districts must clearly demonstrate that they meet the "but for" test, and 3) Districts must increase or have a neutral effect on affordable housing; and 4) Districts must accomplish one of four objectives: a) provision of affordable housing, b) provision of livable community housing and minced use, c) removal of blight conditions and contamination, or d) provision of a net increase in livable wage jobs. This proposed TIF district, an Economic Development District, is not consistent with the Dakota County TIF Policy No. 8002. RECOMMENDATION Staff recommends that the Board acknowledge receipt of the Proposed Tax Increment Plan for Lakeville TIF District No. 18 in the City of Lakeville and find that Lakeville Economic Development TIF District No. 18 is not consistent with the Dakota County TIF Policy No. 8002. EXPLANATION OF FISCAL/FTE IMPACTS Lakeville TIF District No. 18 expects to receive $661,349 in tax increment revenue from 2016 through 2024. Dakota County would shift $188,590 in levy burden to other properties in the County. -131- Item No. 5 City of Lakeville Community & Economic Development Memorandum To: Economic Development Commission From: Rick Howden, Economic Development Specialist Copy: David Olson, Community and Economic Development Director Date: August 21, 2014 Subject: Market Analysis Options In the 2014-2016 Strategic Plan, the EDC set a strategic priority to gain 200 new high quality jobs, earning over $60,000 per year. A strategic initiative set up to accomplish this outcome is to conduct a market analysis to determine target markets to focus our efforts on. There are two options available to accomplish this initiative 1) hire an outside firm to do a Lakeville -specific market analysis or 2) utilize existing research done on the Minneapolis -St. Paul region to identify target markets or industry clusters that would bring high quality jobs to Lakeville. A Lakeville -specific market analysis completed by a private consulting firm is estimated to cost between $30,000-$50,000. Staff will need to identify funding sources in order to proceed with this option, as funding has not been budgeted for this item. Recently, Greater MSP and the U of M's Humphrey School of Public Affairs' State and Local Policy Program have done extensive research into the Metro Area's Industry Clusters. Staff and the EDC may be able to examine the research already completed from these and other sources to identify the markets the City will focus its efforts on to attract. Key industry clusters identified by Greater MSP are: • Headquarters & Business Services • Health & Life Sciences • Food & Water Solutions • Advanced Manufacturing and Technology • Financial Services The U of M's Humphrey School State and Local Policy Program studied the following competitive industry clusters: • Medical Devices 0 Lighting and Electrical Equipment • Analytical Instruments • Processed Food • Metal Manufacturing • Distribution services, Transportation, and Logistics • Financial Services • Publishing and Printing • Production Technology • Information Technology • Management of Companies Additionally, staff would like clarification and further discussion on the intention of the strategic initiative: "examine higher education facilities as a target market". Recommended Action: Provide staff with input as to the desired approach to complete a market analysis to determine target markets. MINNEAPOLIS -ST. PAUL REGIONAL CLUSTER COMPETITIVENESS STUDY Lee Munnich Jonathan Dworin Nebiyou Tilahun Matt Schmit State and Local Policy Program Humphrey School of Public Affairs University of Minnesota October 2013 ABSTRACT This study uses both quantitative and qualitative data to profile the largest industry clusters in the Minneapolis -St. Paul (MSP) region. Quantitative data was gathered using the Cluster Mapping Tool, a tool developed for the U.S. Department of Commerce, Economic Development Authority (EDA), by Harvard Business School's Institute for Strategy and Competitiveness. The study focuses on the potential for knowledge flows across basic (exporting) industry sectors in the MSP region. This is analyzed by looking at similarities in occupations that different industries hire— particularly focusing on specialized workers. The study presents findings and recommendations for the MSP region. Key Findings This study complements a case study by the Humphrey School's State and Local Policy Program on how the Minneapolis -St. Paul region has benefitted from applying a cluster approach as a conceptual framework for diagnosing the regional economy and as a platform for joint action to address the challenges identified.' The cluster framework provides public and private regional leaders with a common language for understanding regional competitiveness, significantly enhancing the effectiveness of their dialogue. By organizing the policy discussion around clusters, regional organizations such as Greater MSP, the Regional Council of Mayors, and the Metropolitan Council have a common platform for focusing programs and investments through a broader regional economic development strategy. This expansive cluster study yields many interesting results and insights. The following are six important findings. Importance of Corporate Headquarters Minneapolis -St. Paul is home to a large concentration of corporate headquarters, including 19 Fortune 500 companies and eight Fortune 1000 companies. Minneapolis -St. Paul is also home to the nation's largest private company, Cargill, and several other very large private corporations such as Carlson, M.A. Mortenson, and Holiday Companies. Although the region is also home to many smaller firms and other components of industrial supply chains, these corporate headquarters play a major role in fueling the regional economy. The reasons for the location of many of these headquarters vary; however, many corporations attribute Minnesota's competitive advantage to the state's strong work ethic, well-trained workforce, and high quality of life (CEOs for Cities Report, 2012). Strong Technology Base Focused on Specialized Products and Advanced Manufacturing Minneapolis -St. Paul's well-trained workforce, in conjunction with other locational factors, has allowed the region to specialize in production and advanced manufacturing. While shipping costs to major markets on the east and west coasts limit Minneapolis -St. Paul from being a key manufacturer of large-scale products, the region has adapted by manufacturing niche -market, highly specialized, and frequently smaller or lighter products. In many instances, these highly technical components stemmed from demand from some of the region's more established legacy clusters, such as medical devices or processed food. As the MSP region continues to grow within these industries, the ability to attract and retain qualified labor becomes extremely important not only to the larger corporations but to the smaller, more specialized firms as well. Z Munnich, Lee W., Jr., L. Burke Murphy, Megan L. Roberts, and Jennifer Schuler. Minneapolis -St. Paul Regional Cluster Initiative: Providing a Framework for Minnesota's Economic Competitiveness. State and Local Policy Program, Humphrey School of Public Affairs, University of Minnesota (2013) A Linkages among Clusters within the MSP Region and with Greater Minnesota The Minneapolis -St. Paul region benefits from a diverse portfolio of traded clusters with linkages to other clusters within the region as well as with competitive clusters in Greater Minnesota. These linkages result from factor conditions, such as a skilled and specialized workforce serving multiple clusters, demand conditions where competitive clusters drive innovation in other regional clusters, and related and supporting industries that form a business ecosystem within the region. For example, in the MSP regional economy clusters, analytical instruments, and production technology play a largely complementary role to other clusters, such as medical devices and processed food. Other clusters, such as distribution services, transportation, and logistics, play a critical role in the distribution and dissemination of the region's manufactured products. The MSP region also benefits from linkages with competitive Greater Minnesota clusters, such as processed food, publishing and printing, and production technology. Linkages through Knowledge Sharing The most prominent sectors in the Minneapolis -St. Paul region also exhibit the potential for knowledge sharing by their occupational hiring practices. This study finds that diverse industries share multiple specialized occupational classes. These common hiring practices enable knowledge sharing as workers flow from industry to industry as job changes occur. For example, occupational data in the region show that corporate headquarters (management of companies sector) seek expertise that is also sought by electromedical manufacturing and insurance carriers. These and other occupational sharing patterns highlight certain occupations as important to multiple regionally important industry clusters. Occupations run the range from those requiring academic degrees (e.g., statisticians, programmers, and engineers) to those in trade sectors (e.g., machine operators and mechanical drafters). The presence of these hiring similarities also suggests that the policymakers ought to take a closer look at the extent to which tomorrow's workforce is being prepared to ensure the regions competitive edge in key industries. Entrepreneurship and Innovation as Drivers of Economic Growth Many of the most prominent companies are headquartered in Minneapolis -St. Paul because they were formed within the region. Minnesota has long been known for its entrepreneurial and innovative nature, beginning with advanced manufacturing from the mining industry, its legacy as a global milling hub, and as a global epicenter for medical devices. For MSP to continue to grow and prosper it must not only continue to support these legacy industries, but, more importantly, renew and enhance the entrepreneurial and innovative spirit that led to their establishment. Within its established industries, the region continues to innovate, in addition to innovating around complementary and emerging industries as well. Emerging Opportunities Stemming from its legacy industries, Minneapolis -St. Paul is at the forefront of many emerging technological fields, such as advanced water tech, biorenewables, 3D printing, and robotics. Although it is difficult to classify each of these industries in their own cluster (or, in many instances, into a predetermined cluster), they all have the capability to advance the region's economy. All of these fields are high-tech and high -knowledge industries with far-reaching regional, national, and global implications. The region needs to continue to attract and retain the workforce necessary for industrial and technological growth. VAX NVV* A ELI. v 1XIN 70 � ( { £ ! § � � i � | Pau � | !g RL |:\§ /��®{B !|`-`; / }t \ 3 \ CD} / 0 } k cro \ \ § B _ , go }t g !jF�{ V �g3 .� I .Y C ALI y b O P� a 3 ; �`k!|;|`I , �.! A. jai 2222 § i)\@ {. `fl�f |■m {t |;||!!� `-|'•�°!! 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With a high concentration of companies focused on water technology, a post -secondary education system that is training the water technology workers of tomorrow and a highly engaged workforce today, Greater MSP has the resources and infrastructure to ensure business and people prosper here. Water technology is an industry on the rise. Investment in water technology is expected to increase by over 40%* in the next three years, indicating promising opportunities for businesses in Greater MSP. The region boasts a large community of thought leaders and closely networked companies. Working in a wide range of areas such as hydrofracking, desalination, agriculture, water reuse, water security, filtration, conservation, and waste water treatment among others, gives the region a unique and diverse perspective unlike any found in the world. (Water. Challenges, drivers and solutions March 2012 (PwC)) "Greater MSP has a unique network of businesses driving innovation in the water technology industry. The availability of talent and thought leadership in this area is the best in the world." Douglas M Baker, Jr., Chairman and CEO, Ecolab GREATER MSP BOASTS THE HIGHEST LABOR FORCE participation rate in the country. It is the home to the largest concentration of hydrologists in the US, and has an exceptional concentration of engineers, water and waste treatment operators, natural sciences managers, biochemists and biophysicists, and conservation scientists, ensuring the presence of talent to help water technology companies succeed. Each year, 36 colleges and universities graduate over 3,000 students with life science degrees and certificates. More than 10 programs are specifically developed to support this major emerging industry. PROGRAMS AT THE U OF M ❑ Center for Water and the Environment ❑ Department of Forest Resources Remote Sensing and Geospatial Analysis Laboratory ❑ Department of Soil, Water, and Climate ❑ Agroecoregions of Minnesota ❑ Institute on the Environment ❑ Large Lakes Observatory ❑ Limnological Research Center ❑ Minnesota Sea Grant ❑ St. Anthony Falls Laboratory ❑ The Minnesota Geological Survey ❑ The Natural Resources Research Institute ❑ University of Minnesota Extension - Environment AREAS OF STUDY IN THE WATER RESOURCES CENTER AT THE UNIVERSITY OF MINNESOTA ❑ Agricultural Impacts on Water Quality ❑ Stormwater and Wastewater ❑ Water Resources Policy and Social Science ❑ Water Supply, Quantity and Quality TRAINING AND PROFESSIONAL DEVELOPMENT AT THE UNIVERSITY OF MINNESOTA ❑ Onsite Sewage Treatment Program ❑ Wetland Delineator Certification Program ❑ Conservation Applications of LiDAR Data ❑ Conservation Drainage Field Days A LEADER IN WATER RELATED JOB GROWTH 2012 2022 MEDIAN HOURLY OCCUPATION JOBS JOBS EARNINGS Engineers, All Other 2,005 2,121 $41.06 Electronics Engineers, except Computer 1,750 1,843 $42.48 Chemists 1,302 1,394 $35.87 1,074 1,135 $25.41 Water and Wastewater Treatment Plant and System Operators 905 1,066 $29'19 Environmental Scientists and Specialists, including Health 940 Natural Sciences Managers 863 $53.30 Chemical Technicians 531 594 $21.35 Biological Technicians 458 547 $19.37 Biochemists and Biophysicists 407 538 $24.60 Environmental Engineers 304 401 $39.31 Conservation Scientists 289 299 $30.06 287 315 $37.70 Chemical Engineers Hydrologists 226 254 $32.76 Health and Safety Engineers, except Mining Safety Engineers 208 235 $40.39 and Inspectors Separating, Filtering, Clarifying, Precipitating, and Still Machine 201 221 $21.51 Setters, Operators, and Tenders Chemical Equipment 169 183 $20'87 Operators and Tenders Materials Engineers 156 173 $37.46 Environmental Engineering Technicians 146 177 $22.58 Chemical Plant and System Operators 115 83 $31.58 TOTAL 11,395 12,519 $35.24 14,000 Minneapolis 12,000 10,000 _ Saint Louis 8,000 Oakland County, (Michigan) 6,000 _. Milwaukee 4,000 2'000 Cedar Rapids 0 N M �Y lC1 l0 r� oo rn ON .-. NN MN N ESTIMATED WATER O O O O O O O N N N N N N N O O O O O N N N N N RELATED JOB GROWTH GREATER MSP JOB GROWTH OUTPACES many of our competing regions with an estimated 11,395 current jobs and nearly 9% growth over the next 10 years. AMERICAN FILTRATION & SEPARATIONS SOCIETY Based in Greater MSP, the I V1 American Filtration & Separations Society brings together the best minds in the industry to discuss water filtration trends and opportunities. Founded in 1987, AFS is a technical educational nonprofit organization. OUTSTANDING QUALITY OF LIFE The Greater MSP community is vibrant, diverse and engaged in an abundance of activities. With five professional sports teams and among the most theater seats per capita, it was recently recognized as the most intelligent, physically active, healthiest and safest cities in America. And the list goes on ❑ #1 bike city (Bicycling 2012) ❑ #3 wellbeing (Gallup Wellbeing 2013) ❑ #3 young professionals (Payscale 2012) ❑ #4 socially networked (Men's Health 2011) ❑ #4 Best Business Market (Marketwatch) ❑ #9 most inventive (Forbes 2013) To Selected Non -Stop Destinations from MSP Airport Mexico City Reykj e AmstAmstvik errdd am London Paris DC GREATER MSP'S CENTRAL LOCATION MAKES IT EASY TO MOVE PEOPLE AND INFORMATION AROUND THE WORLD. Minneapolis -Saint Paul International airport serves 135 non-stop locations and offers over 1200 seats to Europe daily. Passengers can reach any domestic location in less than three hours. Recently, Minneapolis -Saint Paul International was recognized as The Best Airport in North America. "The Greater MSP Region is really the "Silicon Valley of Water" — a place where many leading global companies in water filtration, flow technology, and advanced systems and solutions call home." Randall J. Hogan, Chairman and CEO, Pentair, Ltd. GREATER MSP RANKED 9TH IN THE NATION FOR WATER -TECHNOLOGY RELATED EXPORTS, our largest international export markets include: Canada, China and South Korea. Foreign investment in Greater MSP's water market is strong. Recently, German company Bilfinger acquired Johnson Screens, a New Brighton based water technology company. MAJOR WATER EMPLOYERS IN GREATER MSP INCLUDE: ❑ 3M ❑ Aeration Industries International ❑ Carbonair ❑ Aquaflow Technologies Inc. ❑ Cartwright Consulting Company ❑ CT Associates, Inc. ❑ Ecolab ❑ EcoWater Systems ❑ Equaris Corporation ❑ Dow Water & Process Solutions (FilmTec Corporation) ❑ Fremont Industries ❑ GE Watertech ❑ Johnson Screens (Bilfinger) ❑ Lemna International ❑ Mar Cor Purification ❑ Pentair ❑ Quali Tech Environmental ❑ Siemens ❑ SJE-Rhombus ❑ Trustwater Group ❑ Water D.O.G. Works ❑ WaterGroup EC®LAB Nalco, an Ecolab company was recognized as the 2012 Water Technology Company of the Year by Global Water Intelligence. item %, 4", City of Lakeville Community & Economic Development Memorandum To: Economic Development Commission From: David L. Olson, Community and Economic Development Director Copy: Allyn Kuennen, Interim City Administrator Rick Howden, Economic Development Specialist Date: August 22, 2014 Subject: August Director's Report The following is the Director's Report for August, 2014. Building Permit Report The City has issued building permits with a total valuation of $79,720.674 through July. This compares to a total valuation of $85,160,142 through July of 2013. The City issued commercial and industrial permits with a total valuation of $8,592,000 through July compared to a total valuation of $8,526,259 during the same period in 2013. The City has also issued permits for 181 single family homes through July with a total valuation of $62,561,000. This compares to 208 single family home permits through July of 2013 with a total valuation of $64,578,000. National Site Selector Tour As part of the Minnesota Marketing Partnership, the City of Lakeville participated in a National Site Selector Tour on Tuesday, August 12th. Community and Economic Development Director Dave Olson arranged to have the site selector stop at MOM Brands' headquarters. The site selector that toured Lakeville and other communities in Dakota County is based in Chicago and specializes in assisting businesses in the food industry. This was his first trip to the Minneapolis/St. Paul Metro Area. MOM Brands' Chief People Officer, Mike Sullivan and Pauline Wiegrefe, Corporate Facilities Manager highlighted the advantages of relocating to Lakeville from their perspective, which included; proximity to 1-35 corridor and MSP International Airport, the size and expansion potential of their facilities, the amenities their facilities offer their employees, the workforce in the area and proximity to their existing workforce, etc. On Wednesday, all 8 participating selectors provided feedback to the Minnesota Marketing Partnership members. Many selectors made comments that they prefer meeting with executives of companies that have located in their community to get a better understanding of their experience and whether it was positive or not. Lakeville was ahead of the curve this year by having our selector meet with a business that has recently relocated and expressed their positive interactions with the City throughout the transition. We were able to present a very positive impression of the benefits Lakeville has to offer as well as a very positive reference for this site selector as he works with his clients to identify areas to expand to. Downtown Parking Lot Improvements Work commenced on August 8th to re -construct the City -owned parking lot in the Ben Franklin Block in Downtown. This portion of the project also includes installing sidewalks along the west side of the parking lot fronting on Howland Avenue form Upper 208th Street to 207th Street. The project also includes the construction of streetscape landscaping in front of the Holyoke Avenue parking lot adjacent to the Art Center. Menasha Packaging Ground Breaking Work has also commenced on the 123,000 square foot expansion of the Menasha Packaging Plant in Airlake Industrial Park. EDC Members should have received invitations to the groundbreaking scheduled for Wednesday, August 27, 2014. Hy -Vee Grocery Store Project The City recently received an application from HyVee and Tradition Development for a proposed grocery store to be located in the commercial portion of the Spirit of Brandtjen Farm Development located at the intersection of Pilot Knob Road and Co. Rd. 46. The store will include a pharmacy and a sit-down restaurant. In addition, there will be a free-standing gas convenience store that includes a Caribou Coffee with a drive-thru and a four -bay automatic car wash. This project is scheduled to go to the Planning Commission on September 4th Next Meeting ate. 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'C e 0 aai p � 0 °a 3 'C 'C ° 7 aF"i U U a'' v� U n d w F N to sunthisweek.com http-.Hsunthisweek.com/2014/08/14/hy-vee-planned-to-be-built-in-lakeville/ Hy -Vee planned to be built in Lakeville Development plans include convenience store, coffee shop, car wash Lakeville shoppers will soon have another choice for purchasing groceries. A Hy -Vee grocery store of approximately 90,000 square feet is planned for construction on approximately 11 acres in the Spirit of Brandtjen Farm development at County Road 46 and Pilot Knob Road Plans show the store will include a drive-thru grocery and pharmacy. Construction of a Hy -Vee grocery store, coffee shop, car wash and convenience store is planned in Lakeville. (Photo submitted) An accessory convenience store, Caribou Coffee shop with drive-thru window and car wash is planned to be included in the southeast portion of the development. City Planner Daryl Morey said the Hy -Vee is expected to be open by next summer. He said the company is fast -tracking the platting process to allow them to close on the property before the end of the company's fiscal year on Sept. 30. The Lakeville Planning Commission is expected to consider the preliminary and final plat for the project at its Sept. 4 meeting. The development will be Hy-Vee's 18th store in Minnesota and its first foray into the Twin Cities, according to the company's website. Morey called the grocer's entry into Lakeville an opportunity for the company that will benefit area residents. "Certainly it gives an opportunity for a grocery purchases for residents in the northeast community, not just those in Spirit of Brandtjen, that we don't have in the city currently," Morey said. "Obviously, we're very excited that Tradition (Development) is now moving into the community development phase of their Spirit of Brandtjen Farm Planned Unit Development." In July, Hy -Vee announced it would also be building a store in Oakdale in a former outlet mall located at the intersection of 1-694 and 10th Street North. The company has stated it plans to continue expanding into the Twin Cities by adding multiple stores per year for the next several years. An employee -owned company, Hy-Vee's website states the grocery chain differentiates itself with variety, value and superior customer service. Its website states the company also promotes healthy lifestyles, and includes a growing HealthMarket departments that feature natural and organic products and consulting services of in-store dieticians and chefs Olson, David From: DEED Media <MNDEED@public.govdelivery.com> Sent: Thursday, August 14, 2014 9:46 AM To: Olson, David Subject: July 2014 Employment JJf*JW1Wt4NEWS RELEASE For Immediate Release Contact: Madeline Koch, 651-259-7236 August 14, 2014 madeline.koch(a�state.mn.us Steve Hine, 651-259-7396 steve. h i neCcbstate. mn. us State Loses 4, 200 Jobs in July —Unemployment rate steady at 4.5 percent— ST. PAUL — Minnesota lost 4,200 jobs in July, according to seasonally adjusted figures released today by the Minnesota Department of Employment and Economic Development (DEED). The state's unemployment rate remained unchanged in July at 4.5 percent. The U.S. unemployment rate in July was 6.2 percent. June figures have been revised downward by 3,600 jobs. Over the past 12 months, the state has gained 68,344 jobs, a 2.5 percent growth rate, compared with a U.S. growth rate of 1.9 percent during that period. Every year, July has a drop in the number of jobs on a seasonally unadjusted basis. According to DEED officials, recent divergences due to seasonal adjustment lessen confidence that Minnesota's seasonally adjusted estimates are accurately reflecting recent trends in job growth. "July's employment change appears disappointing, however, this is the smallest percentage decline in jobs for a July since 1999," said DEED Commissioner Katie Clark Sieben. "Minnesota's economic indicators remain positive, and underlying employment data continue to look strong." The sectors that added jobs in July were trade, transportation and utilities (up 1,600), manufacturing (up 700), leisure and hospitality (up 600), and other services (up 200). Logging and mining, and professional and business services held steady. The following sectors lost jobs in July: education and health services (down 5,300), information (down 1,000), construction (down 700), financial activities (down 200) and government (down 100). The July employment losses in education and health services were the most on record, driven by job cuts in private education. Over the past year, sectors that added jobs were government (up 21,513), professional and business services (up 11,667), manufacturing (up 9,505), education and health services (up 9,023), construction (up 8,260), trade, transportation and utilities (up 5,658), leisure and hospitality (up 4,456), and logging and mining (up 636). Financial activities (down 1,152), other services (down 860) and information (down 362) lost jobs in the past year. In the Metropolitan Statistical Areas, the following regions gained jobs in the past 12 months: St. Cloud MSA (up 2.8 percent), Minneapolis -St. Paul MSA (up 2.6 percent), Mankato MSA (up 2.4 percent), Rochester MSA (up 1 percent) and Duluth -Superior MSA (up 0.9 percent). DEED is the state's principal economic development agency, promoting business recruitment, expansion and retention, workforce development, international trade and community development. For more details about the agency and our services, visit us at http://mn.gov/deed/ . Follow us on Twitter at twitter.com/mndeed . Over The Year Employment Growth Seasonally adjusted Not seasonally adjusted Unemployment Rate July 2014 June 2014 July 2014 July 2013 Minnesota 4.5 4.5 4.3 5.0 U.S. 6.2 6.1 6.5 7.7 Employment July 2014 June 2014 July '13- July '14 Level Chan e July '13- July 114 % Change Minnesota 2,814,600 2818 800 68 344 2.5 U.S. 139,004,000 138,795,000 2,616,000 1.9 Over The Year Employment Growth By Industry Sector (NSA) OTY Job Change OTY Growth Rate (%) U.S. OTY Growth Rate Total Non -Farm Employment 68,344 2.5 1.9 Logging and Minin 636 8.8 5.6 q Construction 8,260 7.3 3.6 Manufacturing 9,505 3.1 1.5 Trade, Trans. and Utilities 5,658 1.1 2.2 Information -362 -0.7 -1.0 Financial Activities -1,152 -0.6 0.7 Prof. and Bus. Services 11,667 3.3 3.5 Ed. and Health Services 9,023 1.9 1.8 Leisure and Hospitality 4,456 1.7 2.6 Other Services 1 -860 1 -0.7 1 0.9 Government 1 21,513 1 5.7 1 0.5 Metropolitan Statistical Area OTY Employment Change (# ,NSA) OTY Employment Change % NSA Minneapolis -St. Paul MN -WI MSA 46,339 2.6 Duluth -Superior MN -WI MSA 1,145 0.9 Rochester MSA 1,054 1.0 St. Cloud MSA 2,894 2.8 Mankato MSA 1,236 2.4 -30- Upon request, the information in this news release can be made available in alternative formats for people with disabilities by contacting the DEED Communications Office at 651-259-7161. Minnesota Department of Employment and Economic Development Communications Office Phone 651-398-9459 ort-800-657-3858•TTY 1-800-657-3973 An equal opportunity employer and service provider. • SG Questions? Contact Us Department of Employment and Economic Development STAY CONNECTED: M© 00 © SHRRE