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HomeMy WebLinkAbout08-27-02-02 • City of Lakeville Economic Development Commission Meeting Minutes August 27, 2002 Marion Conference Room, Lakeville City Hall 20195 Holyoke Avenue Members Present: Vogel, Emond, J. Erickson, Pogatchnik, Schubert, Tushie, Smith, Brantly, Ex-Officio member Todd Bornhauser -Executive Director of the Lakeville Area Chamber of Commerce, Ex-Officio member Robert Erickson -City Administrator. Members Absent: Commissioners Miller, Matasosky, Others Present: Staff present: David Olson, Community & Economic Development Director; Ann Flad, Economic Development Coordinator; Todd Rapp, Senior Director of Himle Horner; Steve Clark, Lakeville Resident. 1.Ca11 Meeting to Order. Chair Vogel called the meeting to order at 6:04 p.m. in the Marion Conference Room of City Hall at 20195 Holyoke Avenue, Lakeville, MN. • 2. Approve June 25, 2002 Meeting Minutes. Motion 02.14 Comms. Emond/Pogatchnick moved to approve the minutes of the June 25, 2002 meeting. Motion carried unanimously. 3.A.) Strategic Plan Work Item: Educate residents on the benefits of C/t: Discussion with PR Firm Himle Horner -Todd Rapp. Mr. Todd Rapp of the Public Relations Firm Himle Horner was present to further define the firm's proposal to assist the EDC in developing a plan to educate residents on the benefits of commercial/industrial development. Mr. Rapp indicated that the Lakeville community has several strengths, including conceptual community support for the growth plan and desire for additional amenities, low city taxes with high satisfaction of services, solid communications structures, and no organized opposition to the growth plan. The challenges in the community include anot-in-my-backyard attitude toward specific developments and the lack of easily identifiable benefits that accrue from additional development. Mr. Rapp pointed out that key audiences in the community are not as engaged in economic development issues as the EDC, so education must also include involvement of residents. When presenting benefits of development to the community, it is important to highlight both the long and short term benefits of a development. Economic Development Commission Meeting Minutes August 27, 2002 Mr. Rapp suggested three "critical messages" the EDC may want to convey, although he • did indicate that there may be other relevant messages to consider as well. The three critical messages that the EDC may want to highlight are: the City has low taxes yet quality services, the City is answering the public's call for convenience in the form of businesses such as restaurants and grocery stores, and the City is managing growth responsibly to protect the quality of life, build community, and mitigate concerns about crowding. These messages should be used prominently throughout the community's communications media. Mr. Rapp suggested three strategic goals for the communication plan: 1. Elevate economic development as a priority for taxpayers by setting and publicizing performance goals, linking economic development projects to the performance goals, and creating a vision for shopping, recreation and jobs in Lakeville. 2. Engage residents and businesses in economic development planning to build ownership of decisions by creating area councils, increasing education activities in the community, and implementing creative ways to accept input into the process. 3. Build a coalition of civic opinion leaders and develop joint communication strategies. Comm. Tushie inquired where Mr. Rapp obtained information that was used to formulate his proposed approach to developing a communication plan for Lakeville. Mr. Rapp indicated his information was obtained from the 2001 Decision Resources Survey, Timbercrest articles, and the Strategic Plan for Economic Development. Mr. Rapp emphasized that there could be other approaches to the plan, and the EDC should consider whether there are other critical messages the EDC wants to communicate to residents, although only three should be undertaken. City Administrator Erickson noted that there are two distinct socio-economic populations in Lakeville and different messages resonate with each demographic group. Mr. Erickson indicated that there is a growing level of awareness regarding congestion on the I-35 and Cedar Avenue corridors, and that transportation issues must be addressed in order to attract the commercial and industrial development that will diversify the tax base, provide jobs and provide the amenities the community has requested. Mr. Rapp suggested the City stick to the key messages because emphasizing transportation issues will make it harder for the EDC to communicate the high quality of life in Lakeville. Comm. Brantly indicated that using a kiosk was a novel method of communicating to the community, and inquired about other methods that could be used. Mr. Rapp suggested the EDC re-evaluate their current methods to ensure that the key messages are featured prominently in each medium, and also suggested using a lot of graphics and color. Mr. Erickson noted that the citizens who organized opposition to the Target project had a web site that received a lot of traffic because it posted a great deal of information. The City • may want to consider using a web site to disseminate project-specific information in the z Economic Development Commission Meeting Minutes August 27, 2002 future. Comm. Smith noted that traffic was the top concern that residents voiced about • the Target project, and indicated that more emphasis could have been placed on residents' ability to get on and off of the interstate. Comm. Brantly suggested that benefits to the community should be identified with each project. Comm. J. Erickson suggested the EDC find simple ways to reach the public such as the Lakeville Life & Times newspaper. Mr. Rapp concluded by indicating the EDC must pick its priorities, its messages, and then its strategies. Mr. Rapp left the meeting at 6:56 p.m. Commissioners indicated support for engaging Himle Horner to assist in developing a communications plan. Mr. Olson indicated the City would seek a contract that would include a stipulation that the project cost would not exceed a predetermined amount. Comm. Emond questioned how the EDC would evaluate the ongoing progress of Himle Horner, and Mr. Olson responded that written work product would be shared with the EDC. City Administrator Erickson suggested that the Cable staff and the Public Information staff be included in this project. 3. B.) Strategic Work Item - Educate residents on the benefits of C/I: Spotlight on Business. Ms. Flad reported that the "Spotlight On Business" program continues to be well received by the businesses featured and by the community as a whole. Chair Vogel introduced Jeff Belzer and Jeff Krapu of Belzer Chevrolet, Dodge, Kia, Jeanne Schubert introduced Ken Owen and David Owen of DHY, and Bob Brantly introduced John Greening of New Morning Windows at recent City Council meetings. Combined, these businesses provide over $260,000 in property taxes to the City, School District 194 and the County. They also provide over 315 full and part time jobs for area residents. Comm Pogatchnik inquired whether there would be enough businesses to spotlight in 2003. Ms. Flad indicated that currently the Spotlight features businesses that are the largest taxpayers. At some point the EDC will need to discuss the criteria for businesses to be featured. 4. A.) Strategic Work Plan Item: Investigation of Critical Business Infrastructure - Review and make recommendations on Springsted's Interchange Finance Study. Mr. Olson reported that the majority of the EDC members participated in a Joint Work Session with the City Council on Monday, August 12th at which the Interchange Finance Report was presented by City staff and David MacGillivray of Springsted. Numerous questions from EDC and Council members regarding the report were answered at the joint meeting. • 3 Economic Development Commission Meeting Minutes August 27, 2002 Mr. Olson noted that the report represents a strategy to the financing of these • interchanges and both project costs and actual funding levels from the sources being recommended are still subject to change as these projects progress to fruition. Mr. Feller outlined several changes to the report. According to Mr. Feller, the City's Pavement Management Plan provides for the annual sealcoating, cracksealing and patching of streets. The cost of the Pavement management Plan is financed with property tax levies, which are subject to levy limits. Mr. Feller indicated that staff explored the possibility of financing the program with Street Reconstruction Bonds, however bond attorneys and fiscal consultants have indicated that sealcoating, cracksealing and patching maintenance programs are not considered street reconstruction projects and are therefore not eligibility for Street Reconstruction. Bond financing. Overlays are considered street construction projects and therefore financed with Street Reconstruction Bonds and debt service payments for Street Reconstruction Bonds are not subject to levy limits. Mr. Feller noted that the Draft Report stated that it was improbable that MnDOT would approve advanced funding in the foreseeable future. Subsequent to preparation of the Report, MnDOT announced there are sufficient funds available for advanced funding. The City Council, at its August 19 meeting, approved a Resolution requesting an advancement of approximately $1.504 million. The Municipal State Aid (MSA) advancement therefore reduces the amount of the GO Reconstruction Bonds to be issued in the coming year. • The Draft Report recommends an $185,526 HRA tax levy in 2003 to finance the I- 35/CSAH 50/CR5 Interchange design. Mr. Feller indicated that staff is recommending the project costs be financed with Street Reconstruction Bonds thereby resulting in the elimination of the 2003 HRA levy. The Draft Report indicates that Street Reconstruction Bonds would be issued in December 2002 to finance the CSAH 60 improvements. The bonds will be issued in February 2003 after the City Council conducts the public hearing in December. In response to Mr. Pogatchnik's question, Mr. Feller stated that Street Reconstruction Bonds are General Obligation Bonds subject to the full faith and credit of the City. Mr. Erickson indicated that the City Council, at its August 26 work session, directed staff to assume a 7.5% increase for market value appreciation and a 6.5% rate of growth for new construction for a total annual increase of 14% in tax base. Mr. Erickson indicated that the timeline for the upgrade of the County Road 50 interchange project has been accelerated with the objective of acquiring right of way in 2003 and commencing construction in 2004. Neighborhood meetings are being scheduled with property owners regarding the County Road 50 and the County Road 70 projects. i a Economic Development Commission Meeting Minutes August 27, 2002 Ex-Officio member Bornhauser asked if existing businesses in the County Road 50 • interchange area will need to be relocated. Mr. Erickson responded that it is likely some businesses will need to be relocated. Mr. Bornhauser also asked about the City's ability to withstand the impacts of the state budget deficit. Mr. Erickson reported that because the City's fiscal matters have been well managed, and because significant commerciaUindustrial developments will generate new taxes beginning in 2004, it is anticipated that Lakeville can endure the state budget deficit until 2005. Motion 02.15 Comms. Tushie/Pogatchnick moved to recommend the City Council accept the Interchange Finance Study. Motion carried unanimously. 4.B.) Strategic Plan Work Item: meeting with Dakota County Technical College and Dakota County Community Development Agency. Mr. Olson reported that staff continues to explore the feasibility of developing a Lakeville Technology center with Dakota County Technical College as requested by the High Tech Subcommittee at their April 03, 2002 High Tech Subcommittee meeting. On August 15, 2002, Mr. Olson and Ms. Flad met with Dr. Ron Thomas of Dakota County Technical College, Mark Ulfers of Dakota County CDA, and Barbara Portwood, Bond Counsel for the CDA. Discussion ensued regarding the feasibility of the CDA • issuing Lease Revenue Bonds to finance a Technology Center. Mark Ulfers indicated a willingness to explore the possibility further. The City of Lakeville's role will continue to be to facilitate an ongoing dialog between appropriate parties regarding the feasibility of a Technology Center. The City will also assist the Technical College in identifying potential sites for this project. Comm. Bornhauser inquired whether DCTC has any interest in exploring existing buildings in Lakeville. Mr. Olson indicated that DCTC might consider existing buildings and has already toured the Haase Building in Airlake Industrial Park. 5. Update on Downtown Code Improvement Program -Ben Franklin CDBG project. Mr. Olson reported that the Downtown Lakeville Business Association and the City Council have also recommended approval of the proposed design concept for renovation of the exterior of the Ben Franklin building. The final architectural design work and preparation of bid plans and specifications for the proposed project have been completed. In addition to working with the building owners and architect on the proposed design, City staff has also been working with Scott and Cindi Erickson, owners of the Ben Franklin business to resolve several issues. The pop machines that are located in front . of the store are currently not completely on the public right-of-way because the existing 5 Economic Development Commission Meeting Minutes August 27, 2002 building wall is set back several feet from the sidewalk. The new building wall would be flush with the sidewalk and thus the pop machines would be located entirely on the public right-of-way. This is not permitted under City Ordinance and would pose problems for snow removal and restrict pedestrian flow on the sidewalk. Staff is also working with the Ericksons on new signage for the building. The current wall signage cannot be accommodated on the proposed new building design. Staff is recommending that since the existing signage is part of the overall code improvements being made to the building, that additional CDBG assistance be provided to assist with installation of new signage. The Ericksons are in the process of obtaining proposals for the installation of new signage that will be complementary to the new building facade. Bids for the project were due Monday, August 26, 2002. Provided that acceptable bids are received, the CDBG agreement with J and J Holding (John and Jerry Enggren) for this project could go before the City Council on September 16, 2002. It is anticipated that work would commence on the project in late September and would be completed within 90 days. Comm. J. Erickson questioned the value of the false windows that have been incorporated into the design of the second floor, and also commented that the construction will cause an interruption in Ben Franklin's business. Comm. Tushie indicated that the second floor and its windows will make the building much more prominent on Holyoke Avenue than it would otherwise be. Mr. Olson indicated that the . project start date is intended to allow Ben Franklin to operate under current conditions during their busy early fall season that runs through Lakeville High School Homecoming. 6. Update on Advanced Wireless Project. Mr. Olson reported on the status of the Advanced Wireless Project in the Fairfield Business Campus. Mr. Olson explained that the City Council, with the recommendation of the EDC, previously approved a Contract for Private Redevelopment on April 1, 2002 with Coons Family LLC (Advanced Wireless Communications). Coons Family LLC has subsequently requested several minor amendments to the original contract as follows: • The original contract called for the sale of the property to be completed by July 1, 2002. Coons Family LLC requested that this be extended to September 16, 2002 to allow additional time to obtain approval of their necessary financing for the project which includes a Small Business Administration loan. • The original contract called for the project to be substantially completed by December 31, 2002. Coons Family LLC is requesting the contract be amended to extend the completion date until November 1, 2003. The amendment also requires that the footings and foundation be completed by April 1, 2003. If Coons Family LLC fails to substantially complete the building by December 31, 2002, 6 Economic ~evelopmeM Commission Meeting Minutes August 27, 2002 the Minimum Market Value for the property shall still be applicable as of January • 3, 2003. This will result in the City receiving the same amount of tax increment for taxes payable in 2004. Thus while Coons Family LLC will have until November 1, 2003 to complete their building, the City will receive the same amount of tax increment in 2004 as it would had the building been completed by December 31, 2002. This amendment to the Contract for Private Redevelopment was approved by the City Council at their July 15, 2002 meeting. Mr. Olson indicated that City staff are working with the City Attorney to incorporate an additional source of funding to the project. This source is the City's Revolving Loan Fund that was created with the repayment of the DTED funded loan that was approved for the New Morning Windows project. This proposed loan would be a forgivable loan to Coons Family LLC in the amount of $116,450 and would be paid to the City as the new purchase price for the proposed site in Fairfield Business Campus. This option is being pursued by the City and would benefit the Fairfield Campus TIF District and possible future available funding for Interchange improvements at CSAH 70 and provides no additional assistance to Coons Family LLC. However, this additional financing does reduce the letter of credit requirements for Coons Family LLC which has been a concern with the primary lender for the project. Failure to meet the completion date for the building construction will result in the City • drawing on the letter of credit for the balance of the market value of the lot or $116,450. Failure to meet the job creation and maintaining the business at this location for five years will result in the payment of the additional $116,450. This proposed amendment will be brought to the City Council for consideration at their September 3, 2002 meeting. Motion 02:16 Comms. Emond/Brantly moved to recommend the City Council approve the proposed forgivable loan to Coons Family LLC from the City's Revolving Loan Fund in the amount of $116,450 to be applied to the purchase price of Lot 2, Block 1, Fairfield Business Campus 2"d Addition. Motion carried unanimously. 7. Director's Report Mr. Olson provided status reports on a number of new commercial and industrial projects. Boise Cascade is proposing to construct a 72,000 square foot office/warehouse building on 14.25 acres in the proposed Airlake Development 6th Addition. The site is along the south side of CSAH 70 at the intersection with Holyoke Ave. Boise Cascade will re- locate their current warehouse distribution facility located in Minneapolis to this site and will receive building materials via rail. The estimated building construction cost is $2.5 million and will result in 20 jobs being relocated or created at this new Lakeville location. Economic Development Commission Meeting Minutes August 27, 2002 The development will be considered by the City Council at its September 3, 2002 • meeting. Lakeville Family Dental has proposed a professional office building along Kenrick Avenue near 164"' Street. This building is being developed by the owners of Lakeville Family Dental. Grading for this project should commence in mid-September. A Lakeville Town Office Development is proposed along the north side of 165th Street near Kenrick Avenue. This development will consist of five residential style office buildings that contain 3-5 office units per building that will be available for purchase as town office units. This development abuts the Lakeville Family Dental site to the south and could be reviewed by the Planning Commission at their September 19, 2002 meeting. Comm. Pogatchnik inquired about the viability of office condos. Comm. Tushie indicated that at times office condos pose some difficulties in filling spaces because it can be difficult to find a tenant with exactly the same size of space requirements. Mr. Olson indicated that office condos are a permitted use within the OR (Office Residential) zoning because they provide a transition from the residential area to the commercial area in that neighborhood. The Malmberg/Bond Property is adjacent to the Lakeville Family Dental and Lakeville Town Office Development to the east. While detailed commercial development plans have not been submitted for this property, a proposed grading plan is being reviewed for the site. Several joint meetings with the developers and design engineers for these three • properties have resulted in the preparation of an overall grading and drainage plan for this entire area. The grading of the Malmberg/Bond property would prepare it for commercial development and would also provide a storm water management pond that would serve this property as well as the adjacent Lakeville Family Dental and Lakeville Town Office developments. A Holiday Gas/Convenience store is proposed at the intersection of the Co. Rd. 46 (160th Street) and Garret Path near the entrance to Valley Lake Park. This new Holiday store would include an attached automatic car wash. The Planning Commission is scheduled to review this proposal at its September 5, 2002 meeting. Provincial Bank proposes to construct a new branch bank location immediately west of the proposed Holiday store along Co. Rd. 46. The building is proposed to be a two-story bank building with additional office space for lease. The Provincial Barik and Holiday Station developments will have shared access and have inter-connected parking lots, which requires coordination of grading and drainage plans for both projects. Originally these two sites were anticipated to be the site of a new Ole Piper Restaurant. The Strategic Planning Draft report for the Dakota County Economic Development Partnership is complete. The report will be presented to a meeting of the Dakota County City Administrators and Managers on Friday, August 23'd. While recommendations in the Task Force report suggest the Partnership should re-evaluate its mission and improve its effectiveness, the budgetary cutbacks of many members of the Partnership s Economic Development Commission Meeting Minutes August 27, 2002 may make it difficult for the Partnership to continue to operate in its present form with membership dues as the primary source of revenue. Commissioners received a copy of an analysis of 2000 Census Data for Dakota County as prepared by staff from the Dakota County Planning Department. This is being provided for information only. 8. Chair Vogel adjourned the meeting at 8:07 p.m. Respectfully submitted by: Attested to: ~ Ann lad, Recording Secretary Bob Brantly, Secretary 9