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HomeMy WebLinkAbout01-25-11City of Lakeville Economic Development Commission Regular Meeting Agenda Tuesday, January 25, 2011, 4:30 p.m. City Hall, 20195 Holyoke Avenue Lakeville, MN 1. Call meeting to order 2. Approve November 23, 2010 meeting minutes 3. Election of Officers 4. Discussion of Office Park (OP) Zoning District Uses — Daryl Morey, Planning Director 5. Presentation of a Summary of Existing and Previous Tax Increment Financing Districts in the City of Lakeville — Dennis Feller, Finance Director 6. Update on Marketing Plan Initiative 7. Presentation on Proposal from WebQA 8. Discussion of Spotlight on Business and Other Business Retention Efforts 9. Director's Report 10. Adjourn Attachments: December, 2010 Building Permit Report December 2010 Foreclosure Update Senior Housing Boom Minneapolis StarTribune.com, January 20, 2011 Governor Dayton Puts Strong Leadership Behind Job Growth Strategy Press Release from the Office of Governor Mark Dayton, January 19, 2011 Economic Development Commission 2011 Meeting Schedule City of Lakeville Economic Development Commission Meeting Minutes November 23, 2010 Marion Conference Room, City Hall Members Present: Comms. Matasosky, Brantly, Longie, Tushie, Vlasak, Schubert, Emond, Starfield, Smith, Ex- officio member Mayor Holly Dahl, Ex- officio member City Administrator Steve Mielke. Members Absent: Ex- officio member Chamber of Commerce Executive Director Todd Bornhauser. Others Present: David Olson, Community & Economic Development Director; Adam Kienberger, Economic Development Specialist. 1. Call Meeting to Order Chair Matasosky called the meeting to order at 4 :30 p.m. in the Marion Conference Room of City Hall, 20195 Holyoke Avenue, Lakeville, Minnesota. 2. Approve September 28, 2010 Meeting Minutes Motion 10.10 Comms. Tushie /Smith September 28, 2010 unanimously. moved to approve the minutes of the meeting as presented. Motion carried Prior to agenda item number three, the EDC discussed the option of eliminating the position of EDC Alternate since former Alternate Jerry Erickson passed away last July. Commissioner Erickson was originally a full member of the EDC prior to transitioning to the position of Alternate several years ago. The EDC discussed the merits of advertising and having the City Council appoint an alternate who may be only needed a couple of times at most a year. Motion 10.11 Comms. Emond/Tushie moved to preserve the Economic Development Commission Alternate position of the EDC, but not fill it at this time. Motion carried unanimously. 3. Final Review and Recommendation of 2011 -2013 Strategic Plan for Economic Development Dave Olson reviewed the draft 2011 -2013 Strategic Plan for Economic Development and the discussion that took place at the joint City Council work session on October 25th Economic Development Commission Meeting Minutes November 23, 2010 Comm. Longie asked about funding opportunities for the marketing plan study outlined in the draft Strategic Plan. Mr. Olson responded that staff has explored funding a portion of a marketing plan study with Community Development Block Grant (CDBG) dollars that will become available in July of 2011. Chair Matasosky added that the EDC should identify what a marketing plan study would entail before outlining a budget for it. Mr. Olson noted that it has been mentioned in the past that a subcommittee of the EDC be formed to help develop goals and objectives of a marketing plan study. The subcommittee could identify the scope of what a study would look like and the estimated budget then bring it to the full EDC for discussion. Chair Matasosky asked for three volunteers from the EDC to be on a Marketing Subcommittee of the EDC. It was also suggested that a fourth volunteer be a Lakeville resident solicited from outside of the EDC with some marketing experience. Comms. Brantly, Longie, and Matasosky volunteered to comprise the EDC Marketing Subcommittee and solicit a fourth volunteer from outside of the EDC. Motion 10.12 Comms. Tushie / Emond moved to recommend the City Council approve the 2011 -2013 Strategic Plan for Economic Development as presented. Motion carried unanimously. 4. Review and Recommendation of 2011 CDBG Application Mr. Olson reviewed the EDC memo outlining the 2011 CDBG funding application that will be submitted to the Dakota County CDA by December 15, 2010. Comm. Longie asked if examples of recent marketing studies from other cities that could be reviewed to help the EDC prepare a scope for its marketing plan study. It was also noted that marketing will be an upcoming emphasis of the Lakeville Area Chamber of Commerce and that possible collaborations could be explored. Steve Mielke suggested that the EDC identify their own goals and scope of a marketing plan study prior to identifying strategies and potential partnerships. Adam Kienberger responded that he has been in contact with several cities which have undertaken marketing studies in the past couple of years and will be collecting information and examples to share with the EDC /Marketing Subcommittee. Comm. Emond asked if the City has identified any aging retail centers that could be potential candidates for rehabilitation money from the CDBG program. 2 Economic Development Commission Meeting Minutes November 23, 2010 Mr. Olson responded that rehabilitation dollars from the CDBG program have historically been focused on the Downtown Lakeville area as this is the oldest area of the City. Additional aging retail areas of the City could be analyzed for possible future rehabilitation projects. Comm. Starfield asked if CDBG wasn't used for the recommended programs would general fund money be used to fund these programs instead. Could this be a way to demonstrate a cost savings to the tax payers? Mr. Mielke responded that CDBG can be used for limited programs as an alternative to general fund tax dollars, but without CDBG, many of these programs would probably not be available in the City. Motion 10.13 Comms. SmithNlasak moved to recommend the City Council approve the 2011 Community Development Block Grant application as presented. Motion carried unanimously. 5. Director's Report Mr. Olson reviewed the Director's Report. Mr. Olson noted that directly following the EDC meeting, the Downtown Lakeville Business Association will be holding its annual Holiday Lighting Ceremony at Pioneer Plaza in Downtown Lakeville. 6. Adjourn Chair Matasosky adjourned the meeting at 5:25 p.m. Respectfully submitted by: Adam Kienberger, Economic Development Specialist Attested to: R. T. Brantly, Secretary 3 - No. 00 City of Lakeville Community and Economic Development Memorandum To: Economic Development Commission From: Adam Kienberger, Economic Development Specialist Copy: Steven Mielke, City Administrator David L. Olson, Community & Economic Development Director Date: January 25, 2011 Subject: Election of Officers The February 22, 1994 Resolution Confirming and Defining the Purpose, Responsibilities and Terms of Office for the Economic Development Commission state that "at the first meeting of the year, the Commission shall elect a Chairperson, Vice Chairperson and Secretary from amongst its appointed members to serve for a term of one year." EDC members elected Jack Matasosky as Chair, Gary Tushie as Vice Chair and Bob Brantly as Secretary for 2010. Commissioners are asked to elect officers to serve the 2011 year. : ;W1 I Ti i-� La�i(1e Memorandum To: Economic Development Commission From: Daryl Morey, Planning Director Copy: Steve Mielke, City Administrator City of Lakeville Planning Department David Olson, Community and Economic Development Director Date: January 21, 2011 Subject: Packet Material for January 25, 2011 EDC Meeting Agenda Item: OP, Office Park District Uses On May 17, 2010 the City Council approved amendments to the zoning and subdivision ordinances and the zoning map. The amendments were approved following a 16 month review process that included discussions at several Planning Commission and City Council work sessions and Economic Development Commission meetings, as well as presentation at a public open house. The amendments were processed as a follow -up to the City's Comprehensive Plan amendment approved in December, 2008. The City updates its Comprehensive Plan, and subsequently its zoning and subdivision ordinances, every 10 years as required by State law. New Morning Windows, which is located in the Fairfield Business Campus, was recently listed for sale. An issue has been raised that the zoning of the Fairfield Business Campus no longer allows manufacturing as a conditional use. Fairfield Business Campus is zoned OP, Office Park District. The 2010 Zoning Ordinance update combined the CC, Corporate Campus and C -W, Commercial - Warehousing districts and renamed the district OP, Office Park. In addition, land along CR 70 east of 1 -35 and south of Fairfield Business Campus was rezoned to OP. Manufacturing was removed as an allowed conditional use in the OP District and several new uses were added to the district including research and development facilities, trade and post secondary schools, hotels, hospitals, fitness centers and health clubs, and commercial recreation facilities. The OP District continues to allow compounding, assembly and packaging of products and materials by conditional use permit and manufacturing remains an allowed use in both the 1 -1 and 1 -2 districts. The decision to remove manufacturing by conditional use permit in the OP District was based upon the premise that manufacturing should occur in the industrial districts which tend to be more removed from residential uses. The original concept for Fairfield Business Campus was corporate offices and less industrial uses. An exception to that is New Morning Windows, which was the first business to locate in the Fairfield Business Campus and was allowed to operate a manufacturing use by conditional use permit. Because New Morning Windows is a manufacturing use it was positioned such that it would not adversely impact the adjacent single family lots to the north. In fact a conservation easement was established over the north 155 feet of the New Morning Windows lot in order to ensure that any expansion of that manufacturing use would occur to the south, away from the single family lots. The New Morning Windows conditional use permit runs with the land meaning that any purchaser of their property can also manufacture on the site under the same conditional use permit. In addition, the manufacturing use can be expanded on the New Morning Windows property with an amendment to the conditional use permit. Action Requested Concerns have been expressed by an EDC member that the change concerning manufacturing uses was not specifically discussed during the review of the Zoning Ordinance Update. Staff is requesting feedback on this issue from the EDC. (misc - edcmemo) 2 � City of Lakeville Community and Economic Development Memorandum To: Economic Development Commission From: David L. Olson, Community & Economic Development Director,'' Copy: Steven Mielke, City Administrator Dennis Feller, Finance Director Adam Kienberger, Economic Development Specialist Date: January 21, 2011 Subject: City of Lakeville Tax Increment Financing Summary Report The intent of this report is to provide the EDC with background on how tax increment financing has been utilized in Lakeville in the past and that hopefully this information will provide a background base of knowledge for discussions on how this financing tool could possibly be used in the future. The attached draft report has been prepared jointly by Dennis Feller, Adam Kienberger and myself. It provides an overview of tax increment as a financing tool and a history of how this tool has been utilized in Lakeville and the impact the developments that were assisted have had on the community. Mr. Feller will be in attendance at the meeting to provide an overview and answer questions regarding the City's use of tax increment that occurred prior to my tenure with the City. The City Council has also heard from a Lakeville resident at a recent City Council Meeting during Citizen Comments who expressed concerns regarding the City's past use of tax increment financing to assist businesses that have located in the Fairfield Business Campus. The attached letter to the editor that appeared in the January 14 edition of ThisWeek Newspaper was from the same resident and contains the same type of concerns that were expressed at the Council meeting. The City Council has also requested that staff prepare a response to these comments by providing an overview of the City's past use of tax increment financing in the Fairfield Business Campus as well as other projects in the City. Action Requested: No action is being requested. This is intended to provide the EDC with background information on the use of tax increment financing in Lakeville. City of Lakeville Tax Increment Financing Summary Report January, 2011 Table of Contents 1. Executive Summary 2. Introduction to Tax Increment Financing 3. Tax Increment Summary. 4. Overview of City Tax Increment Projects — Current a. Senior Citizen Center b. DKM Professional Building c. Argonne Plaza d. Southfork Apartments e. Farifield Business Park f. Di -Hed Yokes 2 Executive Summary Tax increment financing is a funding technique that takes advantage of increases in tax capacity and property taxes from development or redevelopment to pay upfront public development or redevelopment costs. The difference in the tax capacity and the tax revenues the property generates after new construction has occurred, compared with the tax capacity and tax revenues it generated before the construction, is the captured value. The taxes paid on the captured value are called the "increments ". Increments go to the development authority and are used to repay public indebtedness or current costs the city incurred in acquiring the property, removing existing structures or installing public services. The main objective of tax increment financing is to encourage certain types of development or redevelopment that would not normally occur without the use of tax increment financing. The type of development or redevelopment that is assisted through tax increment financing must serve a public purpose. The public purposes for which tax increment financing revenues can be expended include, but not limited to (i) expanding the property tax base (ii) providing employment opportunities, (iii) redeveloping blighted areas, (iv) remediating polluted soils and (v) Constructing low- and moderate — income housing. Once the terms of the project have been met, the tax increment financing district is decertified and the property value of tax increment district is returned to the tax rolls, thus increasing the tax base of the municipality, school districts, and county. Local governmental services are primarily financed through property taxes generated with the local jurisdiction. By increasing the property tax base, local governments are better able to encourage redevelopment. 3 The City has seven tax increment districts which have expired. The tax increment projects resulted in the construction of roads, bridges and other public improvements. In addition blighted properties were improved and Fire Station #1 was built. The result has been a $40 million increase in the tax base as well as approximately 900 jobs. A summary of tax increment projects which have been decertified is as follows: TIF District Common Name Type Despatch Industries Redevelopment Fleet Farm TORO Economic Economic McStop Economic Imperial Plastics Economic Century Refming Economic Alcorn Beverage (CH Carpenter, American Renewal and renovation Ductile Iron Pipe Co. 2011 Market Purpose Value Employment Construction public $ 1,834,000 300 improvements and fire station Construction of roads Economic development Public infrastructure Economic development Economic development $ 9,525,000 $ 6,230,000 $ 13,560,000 $ 2,741,000 $ 1,193,000 180 200 115 280 0 Construction of roads $ 5,295,000 34 Lakeville currently has six active tax increment districts. A discussion of each of the districts is contained within this report. A succinct summary of the projects is as follows: 0 Tax Increment Financing Projects - 2011 The Dakota County Community Development Agency (CDA) has also utilized tax increment financing in Lakeville to provide affordable senior, workforce rental housing and funding for first time homebuyer programs. The largest of the CDA's TIF Districts expired in 2010 resulting in a 1.7% increase in the tax base. The CDA still has a TIF District in place for a privately owned affordable rental townhome project along Dodd Blvd. just south of County Road 50. 5 Senior Argonne Southfork Fairfield Di Hed Center DKM Plaza Apartments Bus. Park Yokes TIF Type Housing Redevelopment Redevelopment Redevelopment Redevelopment Renewal and Created 1984 1987 1988 1987 1989 1997 Decertification 2011 2014 2014 2014 2022 2013 Assessors Estimated Market Value Current - 2011 1,105,100 18,194,900 1,649,000 15,288,000 19,977,900 5,782,000 Original 32,500 378,227 758,100 112,000 795,700 463,900 Increased $ 1,072,600 $ 17,816,673 $ 890,900 $ 15,176,000 $ 19,182,200 $ 5,318,100 The Dakota County Community Development Agency (CDA) has also utilized tax increment financing in Lakeville to provide affordable senior, workforce rental housing and funding for first time homebuyer programs. The largest of the CDA's TIF Districts expired in 2010 resulting in a 1.7% increase in the tax base. The CDA still has a TIF District in place for a privately owned affordable rental townhome project along Dodd Blvd. just south of County Road 50. 5 Tax Increment Districts - defined The types, terms, authority and limitations of a City or Housing and Redevelopment Authority resides in Minnesota statutes. The following is a succinct overview of the various tax increment types. Types Purpose Statute Duration To remove blighted buildings or 25 years from first Redevelopment improve marginal land to encourage 469.174 subd 10 reciept or 20 years if redevelopment. reciept deferred Similar to that of a redevelopment district except the degree of 15 years from first Renewal and renovation redevelopment may be less with the 469.174 subd 10 a activity more closely related to reciept inappropriate or obsolete land use. Assist in the redevelopment oif property Soils condition which is not developable due to the 469.174 subd 19 20 years from first existence fo hazzrdous substances, reciept pollution or contaminants. Encourage the development of housing 25 years from first Housing fo rlow -and noderte- income individuals 469.174 subd 11 reciept or 20 years if and families. reciept deferred (i) discourages commerce, industry or manufacturing from moving their 9 years from first Economic Development operations to another city or state, or 469.174 subd 12 reciept or 11 years (ii) increase employement or from approval (iii)preserve and enhance the tax base. Hazardous substance Contains parcels containging pollution 25 years from first subdistricts or contamination. 469.174 subd 23 reciept or 20 years if reciept deferred n Overview of Existing City of Lakeville Tax Increment Projects Project: Redevelopment Project #1 Tax Increment Financing District #2 Lakeville Senior Citizen Center District: The tax increments from the Fairfield Apartments, located at the southeast quadrant of Holt and 207 Street, provided the financing. Purpose: Redevelopment. Provide for land acquisition and site preparation to enable construction of Fairfield Apartments and the Senior Center. Housing. The Fairfield Apartments provides housing for low and moderate income senior citizens. District type: Housing Date Created: 1984 Decertification: 2011 Tax Increments: 2010 District Prope Value Tax Capacity Value Base Value Captured Tax Capacity Value Tax Increment revenues Assessors Estimated Market value: $ 1,105,100 7 Total 9,376 243 $ 9,133 $ 8,822 Statement of Financial Position As of December 31, 2009 Revenues Total Tax Increment revenue 299,336 Investment earnings 31,965 Bond proceeds 355,000 Advalorem taxes 67,361 State aid (HACA) 22,910 Real estate sales 20,000 Total revenues 796,572 Expenditures Land/building acquisition 194,566 Bond principal payments 355,000 Bond interest payments 174,030 Loan/note interest 40,541 Administrative expenses 9,839 Debt expenses 10,992 Other 11,649 Total expenditures 796,617 Net (45 E Overview of Existing City of Lakeville Tax Increment Projects Project: Redevelopment Project #1 Tax Increment Financing District #3 DKM Professional Building District: Tax increments are primarily derived from the Holyoke Professional Building (previously know as DKM Professional Building) which is currently leased by ISD #194 for Community Education and is located at 8755 Upper 208 Street. Purpose: Redevelopment. The original purpose of the project was to facilitate land acquisition for the Winsor Plaza Senior Housing Project located at 20827 Howland Avenue. Public improvements. Project also included land acquisition, site preparation, public improvements such as sidewalks and construction of a parking lot. Economic development. Project also includes a pay -as- you -go land write -down for Heritage Commons. Heritage Commons commercial center has an estimated market value of $16.3 million District type: Date Created: Decertification: Tax Increments: Redevelopment 1987 2014 2010 Total District PropeM Value Tax Capacity Value 221,655 Base Value 3,951 Captured Tax Capacity Value $ 217,704 Tax Increment revenues $ 210,286 Assessors Estimated Market Value: $18,194,900 9 Statement of Financial Position As of December 31, 2009 Total Revenues Tax Increment revenue Market Value Homestead Credit Investment earnings Total revenues Expenditures Land/building acquisiton Installation of public utilities Administrative expenses Public improvements Total expenditures Net $ 1,982,451 141,015 22.013 $ 2,145,479 $ 1,654,074 106,271 46,500 331,010 2, 137,855 7,624 10 Overview of Existing City of Lakeville Tax Increment Projects Project: I -35 Redevelopment Project No. 1 Tax Increment Financing District #9 Argonne Plaza District: The tax increments are derived from the Super America at 175 and County Road 50. Purpose: Public improvements. The original purpose of Tax Increment Financing project was for land acquisition, site preparation and public improvements of four residential parcels in a commercial zoning district adjacent to 175 Street east of County Road 50. The project, however, did not proceed as originally envisioned; the Project was modified in later years to enable the tax increment proceeds to be re- appropriated for construction of public improvements at 175 and County Road 50. District type: Redevelopment Date Created: 1988 Decertification: 2014 Tax Increments: 2010 Total District Property Value Tax Capacity Value 35,274 Base Value 14,412 Captured Tax Capacity Value $ 20,862 Tax Increment revenues $ 20,033 Assessors Estimated Market Value: $ 1,649,000 11 Statement of Financial Position As of December 31, 2009 Revenues Tax Increment revenue Investment earnings Total revenues Expenditures Installation of public utilities Administrative expenses Total expenditures Net Total $ 361,352 34,199 $ 395,551 364,542 26,325 $ 390,867 $ 4,684 12 Overview of Existing City of Lakeville Tax Increment Projects Project: I -35 Redevelopment Project No. 1 Tax Increment Financing District #8 Southfork Apartments District: The financing is provided from the tax increments derived from the Southfork Apartment complex. Purpose: Housing. The purpose of Tax Increment Financing District #8 was to implement interest rate reduction programs and housing development projects in order to assist in providing housing for persons of low and moderate income at prices or rents within their means. Redevelopment. Modifications to the District provided for land acquisition, site preparation and public improvements in and around the current Main Street Manor Senior Project; land acquisition and site preparation for the Meadows North Project (current Lakeview Elementary site); land write -down for the Miller Hartwig project; land acquisition, site preparation and public improvements for the "Old Station" and grain elevator site; land acquisition, site preparation and public improvements for the expansion of Winsor Apartments. Public improvements. Modifications to the District also provided for the acquisition and renovations of property for an Arts Center. District type: Redevelopment Date Created: 1987 Decertification: 2014 Tax Increments: 2010 Total District Property Value Tax Capacity Value Base Value Captured Tax Capacity Value Tax Increment revenues Assessors Estimated Market Value: $15,288,000 210,395 1,401 $ 208,994 $ 200,692 13 Statement of Financial Position As of December 31, 2009 Revenues Tax Increment revenue Investment earnings Bond proceeds Grants Other Advalorem taxes Sale of land Donation Fiscal disparities State aid (HACA) Interest Rate Reduction Bond Premium Other Total revenues Expenditures Land/building acquisition Site improvements /preparation costs Installation of public utilities Social, recreation or conference facilities Interest reduction payments Bond principal payments Bond interest payments Loan principal payments Administrative expenses Other Total expenditures Net Total $ 4,757,619 255,175 3,505,000 128,021 134,187 518,744 1,000 13,976 452 500,000 24,148 377,260 $ 10,215,582 $ 2,249,964 120,608 273,930 1,972,228 1,486,282 1,545,000 1,026,233 228,417 67,440 69,013 $ 9,039,115 $ 1,176,467 14 Overview of Existing City of Lakeville Tax Increment Projects Project: I -35 Redevelopment Project No. 2 Tax Increment Financing District #10 Fairfield Business Campus District: The tax increments from the parcels within the Fairfield Business Campus are appropriated to the debt service which financed the improvements. Purpose: Public improvements: The purpose of Tax Increment Financing District #10 was to provide public utilities and road improvements for the Fairfield Business Campus. Economic development. The District was also intended to create an impetus for private development, maintain and increase employment and to increase the tax base for the taxing jurisdiction. District type: Redevelopment Date Created: 1989 Decertification: 2022 Tax Increments - 2010 Total District Property Value Tax Capacity Value 414,879 Base Value 10,588 Captured Tax Capacity Value $ 404,291 Tax Increment revenues $ 390,521 Assessors Estimated Market Value: $ 19,977,900 District employment: 600 Other: The City of Lakeville was the owner of the Fairfield Business Campus at time of development. As the parcels were sold, Development Agreements were executed. 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Q .� N cd O N c� �O N oo M � Statement of Financial Position As of December 31, 2009 Total Revenues Tax Increment revenue Investment earnings Bond proceeds Sales /lease proceeds Advalorem taxes Bond premium Other Total revenues Expenditures Land/building acquisition Site improvements /preparation costs Installation of public utilities Bond principal payments Bond interest payments Administrative expenses Bond issuance costs Total expenditures Net $ 3,240,527 382,291 6,995,000 436,530 275,000 3,192 116,450 $ 11,448,990 $ 808,099 1,072,536 1,800,972 4,165,000 2,886,664 152,496 74,824 $ 10,960,591 $ 488,399 16 Overview of Existing City of Lakeville Tax Increment Projects Project: Airlake Redevelopment Project No.1 Tax Increment Financing District #17 Di Hed Yokes (DHY) District: The tax increment financing is provided from the property located within the District located at the northwest corner of County Road 70 and Holyoke Avenue. Purpose: Renewal and renovation. The project involved remediation of contaminated soils and site preparation. The property located at the northwest corner of County Road 70 and Holyoke Avenue was acquired and contaminants were removed. The property was reconvened to Di Hed Yokes to provide an impetus for increased employment and tax base. Economic Development. The purpose of Tax Increment Financing District #17 was to provide an impetus for private development, maintain and increase employment and to increase the tax base for the taxing jurisdiction. District type: Renewal and Renovation Date Created: 1997 Decertification: 2013 Tax Increments: 2010 Total District Property Value Tax Capacity Value 118,080 Base Value 7,944 Captured Tax Capacity Value $ 110,136 Tax Increment revenues $ 106,385 District Assessors Estimated Market Value: $ 5,782,000 Other: DHY went out of business in 2009 and the property is currently owned by Associated Bank and is being marketed for sale. 17 Statement of Financial Position As of December 31, 2009 Total Revenues Tax Increment revenue $ 483,294 Investment earnings 22,536 Loan proceeds 530,000 Other 38,030 Total revenues $ 1,073,860 Expenditures Landibuilding acquisition $ 437,340 Loan principal payments 275,000 Loan/note interest 335,470 Administrative expenses 21,508 Total expenditures $ 1,069,318 Net $ 4,542 v City of Lakeville Community and Economic Development Memorandum To: Economic Development Commission From: Adam Kienberger, Economic Development Specialist Copy: Steven Mielke, City Administrator David L. Olson, Community & Economic Development Director Date: January 25, 2011 Subject: Update on Marketing Plan Initiative On Wednesday, January 19 the EDC's Marketing Subcommittee (Matasosky, Brantly, Longie) met for the first time to discuss how to pursue the first goal of the 2011- 2013 Strategic Plan for Economic Development: 1. Create a marketing plan that has a clear message, is flexible, adequately funded, creative, aggressive, and targeted that communicates Lakeville's values, is broad and sector specific based on good information. a. Year 1 — broad plan b. Year 2 — sector - specific plan As approved by the EDC at the November meeting, a fourth "at- large" member of the subcommittee was recommended for appointment by the EDC and a possible nomination may be discussed at the EDC meeting. Community Development Block Grant (CDBG) dollars have been identified as a viable funding source for the completion of a marketing plan study. $38,250 will be available in late February to secure a marketing firm to work with the subcommittee and EDC. An additional $27,680 of CDBG dollars will likely be approved and available if needed sometime in July. Initial ideas were discussed related to the target audiences of a marketing campaign (e.g. 'decision makers "), media that could be used to convey a marketing /branding message, and public involvement in the development of a message. It was suggested that upon appointment of a fourth member to the subcommittee, work will be done to outline key points to be included in an RFP to hire a marketing firm to help guide and compile a marketing plan. At some point in the process a draft set of ideas will be presented to key stakeholders in the community consisting of residents, retail business owners, and major employers in the City. Eventual implementation of a plan will require the support of the residents, Chamber of Commerce, and community as a whole. Much of the work done with the recently approved Strategic Plan will be utilized to help the Subcommittee identify key community assets and opportunities to be included in a plan. Action Requested: None. This memo is provided as an update to the EDC on the activities of the Marketing Subcommittee. City of Lakeville WtJU 11 _40,�aw Community and Economic Development Memorandum To: Economic Development Commission From: Adam Kienberger, Economic Development Specialist Copy: Steven Mielke, City Administrator David L. Olson, Community & Economic Development Director Date: January 25, 2011 Subject: WebQA Proposal In December the City was contacted by an Illinois -based company called WebQA who produces web -based customer relationship management (CRM) services and platforms for municipalities. One of the products offered by the company is a "Shop Local /Lakeville" business directory service to help cities partner with local businesses by allowing them to promote their business on the City's website. Currently the City of Lakeville does not maintain or publish a business directory on the City's website. The company is proposing to work with the City to market to the Lakeville business community an opportunity for the businesses to create a business listing in the new Lakeville business directory. The business has the option to include a description of their business, coupons, information and directions and several other categories if selected. This would provide the opportunity for businesses within Lakeville to have a presence on the City's web page at no cost. WebQA has proposed offering this service to the City for free for at least three years as a way to help them grow their business and test a new web -based advertising revenue model. The company would sell advertising space to Lakeville businesses to be displayed on the directory's main pages (i.e. featured business) not unlike other directory-based websites. In exchange WebQA will host and maintain the Lakeville business directory, help market the benefit to businesses, offer training to businesses on how to create their own listing /micro site, and share 10% of the advertising revenues with the City of Lakeville. Cottage Grove and Buffalo are two cities in Minnesota that currently pay for this service (without the online advertising model being offered to Lakeville at no cost). Information on the company is attached, and a couple examples of the product will be shown at the EDC meeting. Action Requested: Staff is seeking input from the EDC as to whether or not the City should pursue this opportunity. EDC members Longie and Bornhauser recently participated in a webinar on this program and can provide their opinions at the meeting. ShopsOA Micro - websites: Business Setup and Management e,^: My Cu,b —ark Fear - esa Y.— My Pavme i iwaie h C­ Wt La�ay_r� L, A +�iq Save Go Pad lNn�..e TrainirN Vkeo a..­ s- ea Custome9 List MPCustomixs uel Description: Upbad new file: Micro- websites grow local business Des<rwt_ sales by providing a vibrant and interactive communication vehicle between business and residents. e ��' Bae ia: Caroen. aon.et co:wA „ - e e'reecnc ao.':de• a�;o,:wc; rrn:vome f« mw,., n!feent a:.rU.:vr :e:.e u C. eftectveh, re NOrM Dakota's'a.Qeet _- mrufecnar:, .::en Me mos: esrr:vve :areixt - Address l: &X1T +iis Addrtsa Y Phw�e: E.-L lWilirg lrst Finak Spxul tden[Mkatbn: Go+t �,:wnsc: 'v''. -•.•• Photo a Image: � [hes�Fdr� n,. a� ..�� 'Renton Tat Y.G — . at the shn for s .al sa i . -.. no Poe :roses Al °b off PJ_ for -.ema tier of N:O. Ga,:vkte attacMai doq 1 f speuai sa mg. • Local Businesses receive a simple setup and management page to control their content and optionally manage their customers. The page consists of easy, intuitive tools and collapsible sections that let each local business load operation information, documents, questions & answers, coupons and other relevant data. As an option, local businesses can manage and track customers from their setup portal. • For Assistance, Local businesses can review one -to -two minute video tutorials, join a live webinar or use the directory knowledgebase of instructions to lookup information or ask questions. • Updating a site is simply a matter of logging into the Micro -site via secure identification and changing information. After saving, updates can go to the City for review or immediately take place. When an update occurs, those residents that have registered to follow that section of the business micro -site immediately receive notifications of the new information. For more information, please contact WebQA, Inc. at 630- 985 -1300 August 2010 Web,24Q% 7 IRF ShopsQA Almost 50% of small businesses do not have a website 95% of all purchases made within a five mile radius of home The ShopsQA program from WebQA offers local businesses an interactive micro - website that grows sales by improving communication with city residents. Cities receive a Shop Directory that: • Looks and acts like their website. • Gives each business an interactive micro - website • Lets residents ask and follow information • Allows the city to highlight special businesses (such as those affiliated with the Chamber of Commerce) Local Businesses register online with the City and, when accepted, receive: • Their micro - website • Ability to post any information: photos, documents, coupons, info, links, etc. • Complete webinar and video training • Ability to update information at any time • Possible City review of updates before going live Bob Cat Company ? Ask Us a Question West Fargo, ND 58078 . Join or Follow Us 70, -290 -5555 "' Schedule a Meeting See VOUl Service F0 °•`� Manage Business Bob Cat Company Is a leading provider of compact equipment for many different markets. We strive to empower our customers to do their jobs more effiaently and effectively. We're North Dakota's largest manufacturer, with the most extensive compact equipment distribution network in the Wald. Sae Moe ,___ Mention that you saw us at the Show for special savingsl 50% off plans for the remainder of 2010. Download our coupon Residents use the city directory to search local businesses by name, category or keyword and find them on a city map. For each business, residents can: • Review information, • Download documents and coupons, • Join mailing lists • Follow updates, • Ask questions, and • Request to schedule meetings Woodridge, IL 60517 City of Lakeville Community and Economic Development Memorandum To: Economic Development Commission From: Adam Kienberger, Economic Development Specialist Copy: Steven Mielke, City Administrator David L. Olson, Community & Economic Development Director Date: January 25, 2011 Subject: Spotlight on Business Program /Business Retention Efforts The Spotlight on Business program has been a business retention and expansion (BR &E) tool the City has utilized since it was established in 2002 to publicly recognize businesses' contributions to the community. Historically the program has targeted many of the top employers in Lakeville and then featured them at City Council meetings to publicly praise them for being a part of the Lakeville business community. Supplementary BR &E programs have been developed alongside of the Spotlight program in the past several years to add and help maintain a constant contact with the Lakeville business community: Business Visits — targeted at major employers to engage them in meaningful conversation with a representative of the EDC to help identify potential issues and establish a formal relationship with the City of Lakeville. Focus on Business /Out & About — Lakeville Government Channel 16 program highlighting a new or unique business in Lakeville along with a general development update for viewers. Manufacturers Luncheon /Manufacturers Appreciation Reception — Annual appreciation event to thank the manufacturing community for having their business in Lakeville. Held in conjunction with Minnesota Manufacturers Week every October. Chamber of Commerce monthly lunches /networking events — staff network and meet with Lakeville Chamber of Commerce members to build and foster new and ongoing relationships. Lakeville Business Bullets — monthly newsletter designed to keep the business community informed on development information, meetings, and other timely information. Action Requested: Staff is seeking input on the types of businesses that should be targeted for future Spotlights and Business Visits. Should large businesses who have been featured in the past be highlighted /visited more than once? Should the focus be shifted towards other business segments? VII Hu. City of Lakeville Community and Economic Development Memorandum To: Economic Development Commission From: David L. Olson, Community and Economic Development Director Copy: Steve Mielke, City Administrator Adam Kienberger, Economic Development Specialist Date: January 21, 2010 Subject: January Director's Report The following is the Director's Report for January, 2011. Building Permit Report The City issued building permits with a total valuation of $54,308,186 in 2010. This compares to a total valuation of $72,782,473 in 2009. The City issued commercial and industrial permits with a total valuation of $3,742,000 in 2010 which compares to a total valuation of $7,339,500 in 2009. The City also issued permits for 129 single family homes in 2010 with a total valuation of $35,553,000. This compares to 126 single family home permits in 2009 with a total valuation of $34,844,000. The City issued permits for 11 detached townhomes, twin homes and townhomes in 2010 with a total valuation of $3,165,000. The City issued permits for 55 permits for detached townhomes, twin homes, and townhomes in 2009 with a total valuation of $6,166,000. According to a recent press release from the Builders Association of the Twin Cities (BATC), Lakeville was fifth in the Twin Cities metro area in terms of the number of new residential permits in 2010 behind Maple Grove, Blaine, Woodbury, and Shakopee. Development Update The City is currently reviewing the following development proposals that are in various stages of review. Senior Housing Projects: City staff is currently reviewing two fairly large senior housing projects that were first reported to the EDC in October. Kingsley Shores is 101 unit senior housing project that is proposed adjacent to the Chart House Restaurant. The other is a 93 unit senior housing project that would be constructed to be connected to Hosanna! Church. Both projects have hosted neighborhood meetings and are scheduled to be reviewed by the Planning Commission on February 17 Both projects are seeking housing revenue bond financing from the Dakota County CDA. The total project cost for both projects is approximately $40 million. Attached is an article that appeared in the StarTribune on January 19 that discussed a number of the housing projects being development in the Twin Cities. Airlake 70 Development: As was reported to the EDC in November, city staff is currently reviewing a draft Environmental Assessment Worksheet (EAW) for the proposed 60 acre industrial development being proposed by Airlake Development east of Cedar Avenue and south of Co. Rd. 70. Staff is also working on a DEED grant application that could possibly provide partial funding for the extension of Co. Rd. 70 east of Cedar Avenue. It is anticipated that this grant application would be reviewed by the EDC at the February meeting. Proposed Walmart Store: City staff recently met with representatives of Walmart that confirmed that Walmart has entered into a purchase agreement for the site in Lakeville Commerce Center in front of the Muller Family Lakeville Theatre between Harry's Cafe and the office building located at 205 Street and Keokuk. Walmart's representatives are currently working with the City and other agencies to address the proposed impacts to wetlands on site. Walmart is proposing a 150,000 square foot store and would like to be under construction later this year. Malt -O -Meal Expansion: Malt -O -Meal has made a formal application to vacate the conservation easement on the 4.5 acres of land the purchased from New Morning Windows. The City Council has referred this issue to the Planning Commission and they will be reviewing it at their February 17 meeting. Malt-0- Meal hosted a neighborhood meeting on this issue with adjacent residents on November 23 and again on January 19 th . Foreclosure Update Attached is a copy of the December Foreclosure Update from the Dakota County CDA. There were 12 Sheriff Sales in Lakeville during the month of December which is down from the 24 in both November and October. There were a total of 317 Sheriff's Sales in Lakeville in 2010. This compares to the 257 Sheriffs Sales in 2009. The number of Sheriff's Sales in 2010 represented 1.71% of the total households in the City and compares to 1.43% for the number of Sheriffs Sales in 2009. The City is currently monitoring 97 vacant and /or damage homes in the City. Appointment of the Commissioner of the Department of Employment and Economic Development (DEED) Attached is a press release that was issued by Governor Dayton's office on his recent appointment of a new DEED Commissioner. 0� Think n through To the editor: In reference to the Jan. 7 edition of the Thisweek news- paper article about the new Lakeville mayor and council members and their inclina- tion toward being "business and development friendly," it will be interesting how they translate that phrase into spe- cific actions to benefit Lakev- ille as a whole. As decisions are made, each Lakeville city project and expenditure should be evaluated based on aligning with the vision of Lakeville as both a desirable residential place to live and a location where businesses can thrive and desire to locate. Financial decisions should be evaluated with regards to expenses ver- sus revenues but also align- ment with a desirable place to live and work and the overall definition of what Lakeville wants to be known for. Decisions such as sell- ing a city -owned piece of land in 2009 assessed at over $627,000 to Image Trend for one -third (about $209,000) of its assessed value must be evaluated on the financial merits to the city of Lakev- ille. How, long will it take for the city nd taxpayers to re- coup the $418,000 discount, and what profit -loss financial evaluation was performed to justify this giveaway? Another example is the budget line item for almost $192,000 each year through 2014 for "DKM tax incre- ment financing rebate" for the DKM professional build- ing. This district was created in 1988, 22 years ago. Why is the city providing a four -year rebate of almost $760,000, and how is this recurring re- bate expense benefiting the community and taxpayers? Another historical exam- ple was the sale of the 14.4 acres of property to New Morning Windows for $1. The property is now worth approximately $2.1 million (land only) 15 years - later. Just as corporate boards of directors make decisions for commercial corporations, the city should evaluate finan- cial implications of each de- cision to determirte the future revenue to be derived from a project as compared to the expenditure. And it should review other alternatives that provide tangible benefits to the city of Lakeville and all of its residents. 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J Vi 00 O J o p C c CD C 0 0 0 O C O 0 0 O O O tz a ro 0 oa 0 a 0o w cn W Q\ N Vi N O O O O O O OI O O O ICI O OI O O O IOI O O O O O O O O O O O O O 01 "W W N N ? J Vi 00 O J Q\ C 0 0 0 O C O 0 0 O O O O O O O O O C O O O O O 0 0 0 O C CDA Dakota County Community Development Agency O • • • • • • • • • • • • • • • • • • • • • To: Dakota County Cities From: Dan Rogness, Director of Community Revitalization Date: January 19, 2011 Re: Foreclosure Update OWNERS pw&GOK" The following charts show a quarterly comparison from 2009 to 2010 of Sheriff Sale and Notice of Pendency numbers in Dakota County. Sheriff Sales Quarter # of Sales 2009 # of Sales 2010 Percent Change January -March 402 545 +36% April -June 448 519 + 16% July- September 499 621 +24% October - December 511 462 - 10 Total 1,860 2,147 + 15 Notices of Pendency Quarter # of NOPs 2009 # of NOPs 2010 Percent Change January -March 934 942 +.9 April -June 1,051 991 -6% July- September 986 1,016 +3% October - December 915 665 1 -27% Total 3,886 3,614 1 -7 Overall, Sheriff Sales increased by 15 percent from 2009 to 2010. However, Notices of Pendency decreased by 7 percent. 2010 saw a record number of Sheriff Sales for Dakota County. Previously the highest yearly total of sales occurred in 2008, with 2,063 sales. The 2010 total increased 4 percent compared to 2008. The five cities with the highest percent of Sheriff Sales per household are listed below. The 2009 percents are also listed for comparison. The overall county percent was 1.40 compared to 1.23 percent in 2009. Household estimates from the Met Council were used for 2009 (411108) and for 2010 (41112009). 2009 2010 I. Farmington = 2.60% 1. Farmington = 2.95% 2. South St. Paul = 1.63% 2. South St. Paul = 2.02% 3. Hastings = 1.56% 3. Lakeville = 1.71 4. Lakeville = 1.43% 4. Apple Valley = 1.64% 5. Rosemount = 1.42% 5. Burnsville = 1.46% HiO M E Dakota County OWNER S H I P Community Development Agency The five cities with the highest percent of Notices of Pendency (NOP) per household are listed below. The 2009 percents are also listed for comparison. NOPs are official notification that the foreclosure process has begun, and not all notices result in a Sheriff Sale. The overall county percent was 2.36 for 2010 compared to 2.57 percent for 2009. "ZIIIE I. Farmington = 5.44% 2. South St. Paul = 3.58% 3. . Lakeville = 3.30% 4. Rosemount = 3.07% 5. AV /Hastings = 2.62% 2010 1. Farmington = 4.96% 2. South St. Paul = 3.12% 3. Lakeville = 3.00% 4. Apple Valley = 2.61 5. Hastings = 2.56% Dakota County Stats — December 2010 • # of Sheriff Sales in December — 144 (compared to 156 in December 2009) • Total Sheriff Sales for 2010 — 2,147 (compared to 1,860 in Jan.- December, 2009) • # of Notices of Pendency Filed in December — 197 • Total Notices of Pendency Filed for 2010 — 3,614 A Notice of Pendency is filed by a mortgage company's attorney as official notification that the foreclosure process has begun. Not all of these result in Sheriff Sales. Mapping Using Dakota County GIS http: / /gis.co.dakota .mn.us /website /dakotanetgis/ The Dakota County Office of GIS is updating the 2010 Foreclosures and Notice of Pendency layers on a monthly basis. If you need assistance using this Web page, please call Randy Knippel or Mary Hagerman with the Office of GIS at (952) 891 -7081. In The News Provided in this PDF file are a few notable foreclosure articles that were published in the last month. Among the points of interest: • Nationally, the number of foreclosures dropped to the lowest level in 18 months in November, likely due in part to foreclosure freezes that were implemented by several banks following allegations that proceedings were handled improperly. • Many American homeowners are starting to see "walking away" as viable option for their mortgage situations. If you have any concerns, please call me at (651) 675 -4464 or send me an email at drogness dakotacda.state.mn.us Co 0 N L d u d rm• T • V • Q • C • Q- • Q • 4J > • 4J • V = • 40 O • V Y C 0 c • • m O • ° U • = rn = Lv r u L Z a i s i c) U. 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U � N s - � L O S V 41 C � O U a) U a a O a C Z- cd C " o o CIS O C 0 L O L a ,, cd N - T N C C E o T u c eo � d i 0— E O cd u 4j s Z v a) ZE O N V la � c `° o CL N N o E o N � N u Z 0 N O O E Z N N LU O a Z cn 3P u u N C O u a, c - O U,T 1 CL Ln t � N a/ — C Ln O � W - E u 2 0 N Q o U u s O 4J b = -0 O 0 c 3 O � fd N S > w C v o E 0 LL- Format Dynamics:: C1eanPrint :: http:// www. msnbc. msn. com /id/40693891 /ns/business -r... Page 1 of 3 t msnbc.c+om Foreclosures fall to lowest level in 18 months But total for year still expected to break 1 million By ALEX VEIGA Associated Press But even with the decline, it was enough to push the total number of repossessions so far this year to more than 980,000 — the highest a nnual tally of properties lost to foreclosure on RealtyTrac's records dating back to 2005. "It's almost impossible to imagine that we won't break a million" for the year, said Rick Sharga, a senior vice president at RealtyTrac. "Unfortunately, it's a record that we'll probably break again next year." Banks had been on pace to take back up to 1.2 million homes this year before problems with foreclosure documents surfaced in late September. updated 1 hour 45 minutes ago LOS ANGELES— The number of U.S. homes taken back by lenders dropped to the lowest level in 18 months in November, the result of foreclosure freezes enacted by several banks following allegations that evictions were handled improperly. Home repossessions dropped 28 percent from October and 12 percent from November last year, foreclosure listing firm RealtyTrac Inc. said Thursday. The 67,428 homes lenders took back last month were the fewest since May 2009. 'Rapid acceleration' Several lenders responded to heightened Dynamics http: / /www. msnbc. msn. com /cleanprint /CleanPrintProxy.aspx? 1292521460300 12/16/2010 Fo-etl Saron • Ap A "bank owned" sign is seen on a home that is listed as a foreclosure on a HUD website, in Hawthorne, Calif, in this file photo taken July 21, 2010 Format Dynamics:: C1eanPrint :: http: / /www.msnbc.msn.com/id/40693891 /ns/business -r... Page 2 of 3 msnbc.com scrutiny over the foreclosure process by temporarily ceasing taking action against borrowers severely behind in payments while they checked to see if their employees made errors in loan documents needed to complete foreclosures. Some banks later announced plans to resume foreclosures, though at a more measured pace, in an attempt to ensure there aren't any flaws in the process. Lenders' initial freeze and slow ramp -up in foreclosure activity likely caused the sharp decline in foreclosure - related notices sent to households last month. And it's likely to cause another drop in December, Sharga said. mortgages that are at least two months past due, and many of them have yet to even enter the foreclosure process. Meanwhile, millions of homeowners owe more on their mortgage than their home is worth, which makes it more likely they will default on their loan. 10.8 million homes under water About 10.8 million households, or 22.5 percent of all homes with a mortgage, were under water in the July- September quarter, according to housing data firm CoreLogic. The figure is down from 23 percent in the second quarter, mainly because more homes fell into foreclosure and not because home But activity will likely pick up with in the new year. "In the first quarter, we really anticipate seeing a pretty rapid acceleration of foreclosure proceedings as everybody catches up," Sharga said. Banks' foreclosure document problems aside, many of the factors that have contributed to the foreclosure crisis are likely to be present next year and should continue to drive foreclosures. Among them: high unemployment, a weak housing market, flat -to- falling home values and tighter lending standards making it tougher for buyers to qualify for financing. In addition, there are some 5 million prices increased. In all, 262,339 U.S. homes received at least one foreclosure - related notice in November, or one in every 492 households. http:// www. msnbc. msn. com /cleanprint /CleanPrintProxy.aspx? 1292521460300 12/16/2010 Format Dynamics :: CleanPrint :: http: / /www. msnbc. msn. com /id/40693891 /ns/business -r... Page 3 of 3 • i The notices were down 21 percent from October and down 14 percent from November last year, RealtyTrac said. One in every 221 households in Utah received a foreclosure - related notice in November, more than twice the national average. The firm tracks notices for defaults, scheduled home auctions and home repossessions — warnings that can lead up to a home eventually being lost to foreclosure. The decline in foreclosure activity was most pronounced in the more than 20 states that require foreclosures to be approved by judges and where many of the documentation errors came to light. Initial notices sent to homeowners in those states who fell behind on their mortgage were off 43 percent from last year, while foreclosure auctions were down 38 percent, RealtyTrac said. California posted the third - highest foreclosure rate despite a nearly 14 percent drop in foreclosure activity. Rounding out the top 10 states with the highest foreclosure rate in November were: Arizona, Florida, Georgia, Michigan, Idaho, Illinois and Colorado. Coprrtght 2010 The Associated Press All rights resen ed This material mar not be published, broadcast, rewritten or redistributed. Some 37 states recorded a drop in home repossessions from October to November. Nevada No. 1 The number of foreclosure- related notices sent to homes in Nevada fell 20 percent from October, but the state still registered the highest foreclosure rate in the U.S. last month, with one in every 99 households receiving a foreclosure notice. That's nearly 5 times the national average. Utah leapfrogged several states to the No. 2 spot, mostly because of sharp monthly drops in foreclosure activity in California, Florida, Arizona and Michigan. Print Powered By http: / /www. msnbc. msn. com /cleanprint /CleanPrintProxy.aspx? 1292521460300 12/16/2010 Format Dynamics:: C1eanPrint :: http: / /www.msnbc.msn.com/id /40704053 /ns/business -r... Page 1 of 4 % . 1 % CY1 t' bc.Com More see walking on mortgage as a viable plan 'Strategic default' losing stigma as homes go deeper underwater By Jane Hodges msnbc.com contributor and -a -half bath home on the market before finalizing their divorce in the spring of 2009 but had no luck luring move -up buyers to the $600,000 home even after price markdowns. Kelly wound up living there solo, struggling to make the mortgage payments. But as she kept writing checks, and worrying, she became aware that she'd have to make a hard choice: Leave the house while she still had decent savings, or pay until she'd emptied out all her accounts and then enter foreclosure. In the latter scenario, she'd have to look for a lease with no money left for a deposit. Either way, she'd lose the home, whose value had dropped underwater -- below what the couple owed on it. 2 hours 38 minutes ago More Americans than ever are showing a willingness to walk away from their underwater homes, according to a recent survey. Chris Kelly is a perfect example of someone who never thought she would send the bank "jingle mail" — mailing the keys back. But she did. Until last year Kelly, a 46- year -old administrative assistant, was living in a 3,000 - square -foot home she owned with her ex- husband in the Seattle suburbs. The duo had put the three - bedroom, three- Print Powered By cd ��r�rni�s http: / /www.msnbc.msn.com/ cleanprint /CleanPrintProxy.aspx? 1292867530378 12/20/2010 Chns Kelly, shown in her apartment in Austin, Texas says she is much happier after downsizing and walking away hom a 3,000 - square -foot Seattle house Format Dynamics:: C1eanPrint :: http: / /www.msnbc.msn.com/id/40704053 /ns/business -r... Page 2 of 4 N% msnbc-com "It was a pretty clear decision," says Kelly, who now lives in Austin, Texas. "I knew I had to walk away. The longer I stayed there, the worse my credit would be and the harder time I'd have finding a rental." So a year ago she walked way, joining the growing number of Americans willing to turn their backs on homes they can neither sell nor afford to keep. The real estate industry calls this "strategic default," referring to people who choose to walk away even when they can technically afford to continue paying their mortgage. Just six months ago, a similar survey indicated that only 41 percent of consumers would consider walking if they were underwater on their mortgages. "It's a phenomenon we haven't seen before in the housing market," said Rick Sharga, senior vice president of RealtyTrac. "The mindset of why people purchase a home has changed over the past decade." In the early 2000s, as home prices rose sharply and steadily, many buyers saw their home as an investment. But in the wake of the housing bust, it's clear that a home has become far more of a "utility" — a form of shelter — than an investment. Over the next year, hundreds of thousands of homeowners will face the question of whether t o walk away as their mortgage payments spike. Nearly half, 48 percent, of homeowners with a mortgage said they would consider walking away from their home if they owed more on it than it was worth, according to a Harris Interactive survey released this month. The survey was conducted in November for real estate listings site Trulia and foreclosure research firm RealtyTrac. Print Powered By d _ ----- -- :- Dynamic http:// www. msnbc. msn. com/ cleanprint /CleanPrintProxy.aspx? 1292867530378 12/20/2010 Format Dynamics:: C1eanPrint :: http: / /www.msnbc.msn.com/id/40704053 /ns/business -r... Page 3 of 4 msnbc.com Sharga said that $300 billion worth of adjustable rate mortgages are expected to reset upward over the next 12 to 15 months, adding on average $1,000 to monthly mortgage payments on homes that already are worth 30 percent to 50 percent less than their original sale price. Roughly 23.2 percent of all single- family homeowners who have a mortgage are underwater on their property, according to third - quarter data from Zillow. (Zillow estimates that 40 percent of single - family homes are owned, with the rest mortgaged.) In addition, the impacts to credit from a foreclosure are typically less damaging than those from a bankruptcy, which hits more lines of credit and loans than just the home loan. According to Barry Paperno, consumer operations manager at myFico.com, the consumer site for Minneapolis -based credit scoring company Fair Isaac Corp., a personal bankruptcy can shave 130 to 240 points off a person's credit score, while a foreclosure typically reduces a score by 85 to 160 points. (FICO scores range from 350 to 850, with higher scores better.) "It's serious, and it certainly complicate future Major banks, including Bank of America and purchases," Paperno says. "Compared to a Wells Fargo, are preparing to work with these bankruptcy, though, the score impact can be owners through modification programs that surprisingly different." may include principal reduction or temporary i nterest -only loan payments until markets The latest Harris survey also revealed some improve and refinancing is possible, Sharga interesting gender differences in attitudes says. about strategic default: Men were nearly 50 percent more likely than women to consider But clearly, many homeowners may have motivation to walk. They'll see their mortgage payments spike at a time when their home value is underwater the deepest. American homeowners lost $1.7 trillion in home value during 2010, a far higher loss of equity than the $1 trillion lost during 2009, according to Zillow data released earlier this month. Zillow also reported on a blog that less than one - fourth of the 129 metro areas it tracks showed home value gains in 2010. Story: Have down payment, but stuck in appraisal hell Print Powered By : Dynamics http:// www. msnbc. msn. com/ cleanprint /CleanPrintProxy.aspx? 1292867530378 12/20/2010 Format Dynamics:: C1eanPrint :: http:// www. msnbc. msn. com /id/40704053 /ns/business -r... Page 4 of 4 o msnbc.com walking away from an underwater loan, with 57 percent indicating willingness, vs. 40 percent of women. Story: Where home prices are falling dan;_�erously Pete Flint, CEO of Trulia, said that this may indicate men take a more investment- minded approach to homeownership and evaluate when to walk as a financial decision, while women may view their property as a home and have a harder time with the concept of leaving it even under fiscal duress. Kelly embodies both approaches. She says she was torn about the decision, but couldn't let sentiment overtake what, ultimately, was a move toward self - preservation. "I never thought that this was something that would happen," she says. "I loved that house." Jane Hodges ( x wi /anebndges net) is a writer in Seattle Print Powered By ,.byrnamics http: / /www. msnbc. msn. com /cleanprint /CleanPrintProxy.aspx? 1292867530378 12/20/2010 Format Dynamics:: CleanPrint :: http: / /www.startribune.com /local /south/l 13635744.htm... Page 1 of 3 ;;::: 11111 � k MH Senior housing boom Ebenezer Management Services and Hosanna Lutheran in Lakeville are joining forces to build a 9 3 -unit senior project next to the church. With baby boomers getting ready to retire, housing for the elderly is going up across Dakota County and beyond. By JIM ADAMS Star Tribune Last update: January 18, 2011 - 7:46 PM Despite the lagging construction market, senior housing projects are sprouting in the Twin Cities, especially in Dakota County. Two projects are underway in Apple Valley and South St. Paul, and five more are being planned in Dakota County, according to the county's Community Development Agency (CDA). The five include two continuum -of- care projects in relatively young Lakeville, and a similar assisted - living center in Burnsville. At least five of the Dakota projects will offer memor -care units to serve the growing number of seniors expected to have Alzheimer's or other forms of dementia. "A boomlet is underway for senior housing," said Mark Ulfers, CDA executive director. "It is clear that baby boomers are moving into their retirement years and seniors are living considerably longer. That combination has created a significant increase in demand for all types of senior housing." Senior projects in other counties include the 76 -unit York Gardens, opening in Edina in April, and a 48 -unit project underway in Mahtomedi. The Anoka City Council this month approved a 221 -unit project by Volunteers of America, which plans to break ground this spring, said city planner Erik Thorvig. Two more projects for lower income seniors are underway in Forest Lake (70 units) and Oakdale (39 units), said Barbara Dacy, executive director of the Washington County Advertisement http: / /www.startribune.com /templates /fdcp? 1295473949585 Dynamics 01/19/2011 Pope Archetects Format Dynamics:: C1eanPrint :: http: / /www.startribune.com /local /south/113635744.htm... Page 2 of 3 kjIt Sta rTr i b u n e x0a miatmi Housing and Redevelopment Authority. Ulfers said his agency, which manages 23 senior apartment buildings with 1,337 units, has for the first time entered an agreement to build senior housing that includes memory care and other assisted - living units. The $21 million Valley Ridge project was approved in December by the Burnsville City Council. Presbyterian Homes will operate 40 assisted - living and 20 memory -care apartments in the 140 -unit building. The CDA estimates the project will cost more than $21 million, including demolition of the Valley Ridge shopping center. Lakeville, which has more kids per household than most suburbs, is reviewing plans for two senior housing projects that the city hopes will provide almost 200 units by mid -2012. One is an unusual partnership between Ebenezer Management Services, a Lutheran - related non - profit, and Hosanna, a Lutheran church in Lakeville. The church is providing four acres next to its large worship center on 163rd Street for a 93 -unit senior project, estimated to cost more than $21 million. The 7,000- member congregation will provide about $350,000 toward a covered drop -off entryway and enclosed walkway connecting the senior building to the 2,500 -seat worship center, said the Rev. Bill Bohline. "Our focus is intergenerational," said church executive director Mary Carroll, noting the church has weekly programs for about 1,500 grade school kids. The church plans to send its youth through the enclosed walkway to visit seniors next door and expects some seniors will respond by joining the church's many volunteer -run activities, she said. "Seniors can get isolated in a facility where they don't interact with the community," Carroll said. Ebenezer Management Services will finance, build and run the three -floor senior building, said vice president Susan Farr. She noted a Hosanna membership survey in 2009 that found about 25 percent would like to place family members at the proposed senior center. A few members have already reserved units, Farr said. "It's all about family connections," she said. Ebenezer is also building assisted - living centers in Edina and Mahtomedi, Farr said. Bohline said he knew of only one other church with a senior center connected to its Advertisement • ro - - a http://www.startribune.com/templates/fdcp?1295473949585 : Dyna rlics 01/19/2011 building: Shepherd of the Lake Lutheran in Prior Lake, which partnered with Presbyterian Homes. He said Hosanna plans to borrow an idea from the Prior Lake church, whose members adopt seniors and walk with them to the church for worship and activities. "It fits perfectly with our mission: Advancing God's kingdom everywhere, one person at a time," Bohline said. He said Hosanna aims to emulate the old country churches that guided members from cradle to grave. Lakeville officials are reviewing Hosanna's proposal as well as the 101 -unit Kingsley Shores on a lake near the Chart House restaurant on Klamath Trail. "We are excited about both projects," said city planning director Daryl Morey. Ulfers said both projects have applied to the CDA for tax - exempt revenue bonds, as has a 120 -unit project near Interstate 35E in Lilydale. All three projects plan to start building this spring. Another CDA -owned apartment building, the 60 -unit Cobblestone, opened in Apple Valley last summer. Other senior projects include: • Thompson Heights, a 60 -unit independent - living apartment building being constructed in South St. Paul by the CDA. • Seasons at Apple Valley, a 134 -unit market -rate building by Ecumen, due to open this spring. • Vermillion Crossings, a 66 -unit independent - living rental project in Farmington. The CDA plans to break ground this spring. Dakota County began plaiming for the "age wave" about five years ago, said Jane Vanderpoel, a county management analyst. "We will have more seniors than school children by 2025," she noted. The number of county residents over age 65 is expected to double to 14 percent from 2000 to 2020, and reach 20 percent by 2030. Jim Adams • 952- 707 -9996 Shortcuts To Links In Article 1. http: / /ezuri.co /5e61 Advertisement EMM UME= http: / /www.startribune.com /templates /fdcp? 1295473949585 Dynamics 01/19/2011 OM attlae rnx. �at� ct�ieatia s Ena srt�ca�t State of Minnesota ;V' Office of Governor Mark Dayton FOR IMMEDIATE RELEASE January 19, 2011 Contact: Katharine Tinucci (0) 651- 201 -3441 katharine.tinucci(a-,state.mn.us Governor Dayton Puts Strong Leadership Behind Job Growth Strategy Phillips, Edman, Tunheim will bring experienced, private sector leadership to DEED, Explore Minnesota, and statewide job creation efforts St. Paul, MN — Governor Mark Dayton underscored his commitment to put jobs and economic growth at the forefront of his agenda, today announcing a strong team to lead the efforts. He appointed Mark Phillips, a private sector business development professional, as the Commissioner of the Department of Employment and Economic Development (DEED), the anchor agency of the Administration's job creation efforts. The Governor re- appointed John Edman as Director of Explore Minnesota, continuing efforts to boost tourism – a key engine of economic and job growth statewide. Governor Dayton also announced that Kathy Tunheim will serve as a Senior Advisor to the Governor for Job Creation, a volunteer position that will drive outreach efforts to spur jobs growth. "The best solutions to Minnesota's chronic budget deficits are jobs and economic growth," said Governor Dayton. "They will be my top priorities, and these three outstanding leaders will be tremendous partners in putting these words into action. I will work closely with this strong team of Kathy Tunheim, Mark Phillips, and John Edman to encourage Minnesota's economic growth and help put Minnesotans back to work." DEED Commissioner Mark Phillips brings over twenty -five years of demonstrated leadership in development and finance, including launching new and creative programs for community and economic development, real estate development and business financing. Currently, he serves as Director of Business Development for Kraus - Anderson Construction. Phillips' career bridges public and private industry in both metro and greater Minnesota, having served as Director of Community and Economic Development at the Iron Range Resources and Rehabilitation Board (IRRRB) under Gov. Perpich, as Director of Development for Minnesota Power, and as Vice President of Northeast Ventures Corporation. He is a recipient of the Economic Development Association of Minnesota's Career Achievement Award. "It is an honor to be chosen to lead this agency that's so important to our state's economy," said Phillips. "Governor Dayton has made it clear that jobs are his number one priority, and I am ready to get to work to enhance Minnesota's economic environment and support the Governor in his mission to get Minnesotans working again." Governor Dayton also reappointed John Edman to lead Minnesota's tourism office, Explore Minnesota. Since taking the helm as Director in 2000, Edman has earned the widespread respect of the tourism industry. Edman previously held leadership positions in prominent public and private travel organizations, including serving as Director of Marketing for Carlson Destination Marketing Services. Tourism remains a key economic driver in Minnesota, generating $11 billion in gross sales, $3.9 billion in wages, and $699 million in state sales taxes, according to Explore Minnesota's most recent Economic Impact study. Because tourism represents not only a large sector of our economy but also a tremendous opportunity for growth, Governor Dayton and Mr. Edman will travel to Brainerd to meet with the local tourism industry and participate in one of the state's major ice fishing events, in recognition of the importance of tourism to the area. To further his commitment to job creation and building a foundation for economic growth, Dayton today announced that Kathy Tunheim would serve as a Senior Advisor to the Governor for Job Creation. Tunheim's role will be to bring together the best thinking, advice, counsel and expertise on how to grow private sector jobs and Minnesota's economy. The focus will be on three specific areas: what do facts and analysis say about what will drive job growth and economic vitality in Minnesota; what kinds of jobs should Minnesota focus on creating and where is our competitive advantage; and what are the specific opportunities before us and how do we seize them. "I am especially grateful to Kathy Tunheim for undertaking this key role in a volunteer capacity" said Governor Dayton. She brings priceless experience and exceptional working relationships with many of Minnesota's business and other civic leaders. She will help me to develop those relationships and, despite the painful task of balancing the state's budget, reach out to Minnesota's job providers to find out what we can do to encourage their continued success and growth in our state." "Governor Dayton has asked all Minnesotans who are able to serve, and I'm honored to be asked to serve in this capacity," said Tunheim. "Minnesota has a diverse and complicated economy, and we will focus on pulling all the different threads together and evaluating the best policy options to ensure Minnesota is an economic leader for years to come." Kathy Tunheim is founder of Tunheim Partners and President of IPREX Worldwide. Tunheim has spent a lifetime in leadership in both the public and private sectors, including Honeywell and in the office of Wendell Anderson as both Senator and Governor. While she has served on the boards of such prestigious groups as the Bush Foundation and the University of Minnesota Foundation, she will be resigning from her non - profit and advocacy board positions in order to dedicate her efforts to the charge given to her by the Governor. Tunheim will report to the Governor, and will work directly with DEED. Tunheim's work, alongside the many efforts of DEED, will be key pieces of Dayton's effort to engage the private sector to work in greater partnership with the state to create jobs and prosperity for all Minnesotans. Economic Development Commission 2011 Meeting Schedule Month Date January Tuesday, January 25, 2011 February Tuesday, February 22, 2011 March Tuesday, March 22, 2011 April Tuesday, April 26, 2011 May Tuesday, May 24, 2011 June Tuesday, June 28, 2011 July No Meeting August Tuesday, August 23, 2011 September Tuesday, September 27, 2011 October Tuesday, October 25, 2011 November Tuesday, November 22, 2011 December No Meeting • All meetings begin at 4:30 p.m. in the Lake Marion Conference Room at City Hall unless otherwise noted on the meeting schedule. * All meetings are held on the fourth Tuesday of the month unless otherwise noted.