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HomeMy WebLinkAbout03-21-2018 • CITY OF MOUNDS VIEW ECONOMIC DEVELOPMENT COMMISSION MEETING AGENDA MOUNDS VIEW CITY HALL FRIDAY, MARCH 21, 2008 7:30 A.M. 1. CALL TO ORDER 2. ROLL CALL Chair Helgemoe, Vice Chair Meehlhause, Commissioner Belting, Commissioner Entsminger, Commissioner Johnson, Commissioner Larson, Commissioner Wagner, Community Development Director Jim Ericson and Economic Development Specialist Heidi Steinmetz 3. APPROVE MARCH 21, 2008 EDC AGENDA 4. APPROVE FEBRUARY 15, 2008 EDC MINUTES 5. SPECIAL BUSINESS 6. EDC BUSINESS • A. Continue Discussion Regarding Internal Public Communications/Marketing Assessment B. Discuss 2008 Targeted Business List C. Discuss Housing Replacement Program 7. REPORTS OF COMMISSIONERS 8. REPORTS OF STAFF A. Economic Development Component of Comprehensive Plan B. Final Version of the Mounds View Business Toolbox C. Premium Stop Redevelopment Area Update 9. NEXT EDC MEETING: Friday, April 18, 2008 at 7:30 a.m. 10. ADJOUNMENT • Not Approved Minutes of the Economic Development Commission City of Mounds View Ramsey County, Minnesota Regular Meeting February 15, 2008 City of Mounds View, Council Chambers 2401 Highway 10, Mounds View, MN 55112 1. CALL TO ORDER: Chairperson Jason Helgemoe called the meeting to order at 7:40 a.m. 2. ROLL CALL: Members Present: Greg Belting, Jason Helgemoe, Torri Johnson, Dan Larson, Gary Meehlhause and Jennifer Wagner Members Absent: Jackie Entsminger Staff Present: Economic Development Specialist Heidi Steinmetz • 3. APPROVAL OF AGENDA: Motion/Second: Commissioner Larson moved and Commissioner Belting seconded the approval of the February 15, 2008 EDC agenda. Motion Carried: 6 Ayes 0 Nays 4. APPROVAL OF EDC MINUTES: Motion/Second: Commissioner Meehlhause moved and Commissioner Wagner seconded the approval of the January 18, 2008 EDC minutes. Motion Carried: 6 Ayes 0 Nays 5. SPECIAL BUSINESS There was no special business. 6. EDC BUSINESS A. 2006 Retail Trade Analysis Presentation - Bruce Schwartau, U of M Economic Development Specialist Heidi Steinmetz provided the EDC with background • information as to why staff requested that a Retail Trade Analysis be completed by the EDC Minutes February 15,2008 Not App P-'ro Vpp S Page 2 • U of M Extension Office. Ms. Steinmetz explained that since Silver View Plaza is half vacant, the analysis may help explain why a retail use is no longer pertinent there and/or throughout the City as a whole. She added that the analysis also compares the City of Mounds View with Ramsey County. Bruce Schwartau from the U of M explained that he is here today in place of Liz Templin, who is the designated representative from his office that covers the Mounds View area. Mr. Schwartau stated that the main purpose of his presentation is to explain to the EDC how to read and use the analysis. Mr. Schwartau stated that the information used to complete the analysis was generated from the MN Dept. of Revenue's 2006 sales tax data, Census Bureau data and data from the Bureau of Economic Analysis. The analysis includes Mounds View's gross sales data beginning in 1990. He commented that Mounds View's gross sales have not changed that much over time. He did caution the EDC that the analysis is deceiving because the State does not differentiate sales tax data into categories unless there are four of the same type of business within a community(such as four apparel stores). If there are less than four of the same type of business, they get categorized into a "Miscellaneous" category. Commissioner Meehlhause asked if automobile dealerships were included in any of the categories. Mr. Schwartau answered that autos are not included because they fall into a separate category, which is why the Saturn dealership is not included. The "Vehicles & Parts" category includes ATVs, motocycles, auto parts, etc. Mr. Schwartau discussed Mounds View's"pull factor"and he commented that it is probably • not a secret to the EDC that most Mounds View residents do not shop in Mounds View. The "Food, Groceries" category had a decline in the 1990s and every other category has remained fairly level. Mr. Schwartau then talked about expectations of gross sales for Mounds View, taking into account Mounds View's income levels, amount of residents and the geographical size of Mounds View. He explained that Mounds View could expect$7.6 million of taxable"Food, Groceries" sales but that $3 million is currently being sold. He said those numbers are somewhat of the equivalent of 7,000 people shopping for groceries elsewhere. Another example he gave was that Mounds View could expect $2.5 million in sales for "Repair, Maintenance". The "Repair, Maintenance" category refers to businesses that return equipment such as cars, lawn mowers, small engines, computers, appliances, etc. to working order. In Mounds View, $1.6 million worth of"Repair, Maintenance" services are being provided. That is the equivalent of 4,000 people receiving repair and maintenance services elsewhere. Commissioner Meehlhause asked if there's a difference between Mounds View, which is part of a large, metro area and Alexandria (as an example)because Alexandria is somewhat self-sustaining. Mr. Schwartau said tourist centers typically have high "pull factors" so Commissioner Meehlhause is correct that Mounds View shouldn't be compared to a tourist center. Mr. Schwartau mentioned that he will discuss Blaine in comparison to Mounds View, per staffs request, as a local "pull factor"comparison. The purpose is to see what types of items people are purchasing in this area. Apparel, leisure goods and electronics seem to be strong sellers in Blaine. • EDC Minutes February 15,2008 Not't J" .f-'r oo v d Page 3 • Mr. Schwartau added that the advantage for Mounds View is that shoppers are being drawn to nearby Blaine, so Mounds View could try and attract those shoppers. Ms. Steinmetz asked "What has changed in the retail sector that has caused Silver View Plaza to be less vibrant?" Mr. Schwartau said it was most likely due to the construction of TH10, however it may be easier for shoppers to get around in Mounds View (rather than Blaine), so more marketing and communications may draw shoppers back to Mounds View. Commissioner Wagner said that since one of Mounds View's "pull factors" is "Leisure Goods"should Mounds View build on that element? Mr.Schwartau answered that there are surveys that can be conducted to determine where customers are coming from or what their interests are, which may help a community decide what businesses to recruit. Commissioner Wagner gave the example of Wynnsong theater and how it seems to be a regional pull and perhaps entertainment is Mounds View's untapped market. Although Mr. Schwartau usually provides two-hour Retail Trade Analysis presentations,staff limited his presentation to twenty minutes,therefore Mr. Schwartau explained that his twenty minutes were up and asked that the EDC contact him or Liz Templin at his office with further questions. B. Introduce New Property Manager for Silver View Plaza - Katie Viere Ms. Viere introduced herself to the EDC. Ms. Viere will be invited back to a future EDC meeting once she familiarizes herself with the area. • Commissioner Johnson asked Ms. Viere what her priority projects will be and if certain Kraus-Anderson properties are viewed as groups of properties. Ms.Viere said that she will be managing ten other properties in the area, which include Blaine Town Center, Blaine Crossing and Brighton Village. She added that each Kraus-Anderson property is viewed as a stand-alone property. Commissioner Belting added that the EDC's concerns are that Silver View Plaza is half empty, that Mounds View Square has received a facelift and that Kraus-Anderson does not seem to provide clear answers regarding their plans for the building. He is wondering if Silver View Plaza is on Kraus-Anderson's radar as part of a five-year plan. Ms. Viere said she would check into that and get back to the EDC. Chair Helgemoe asked if April would be enough time to become familiar with the property and discuss its future with the appropriate people at Kraus-Anderson. He added that the EDC would like to help advance the revitalization of Silver View Plaza and that it has been one of the EDC's goals. Ms. Steinmetz stated that the Retail Trade Analysis was an affordable first step to try and assist Kraus-Anderson to sustain or revitalize the property. She mentioned that staff also solicited market study quotes from three firms and submitted them to the interim property manager back in late December. Ms.Viere asked Ms. Steinmetz to resend the quotes. Ms. Steinnmetz added that she has followed up monthly with Kraus-Anderson regarding Silver View Plaza. • EDC Minutes February 15,2008 Not Approved Page 4 • C. Discuss Business Improvement Partnership Loan Program Interest Rate Ms. Steinmetz mentioned that this item is a continuation of previous EDA discussions regarding the draft Mounds View Business Toolbox document. The EDA asked for the EDC's input regarding the Loan Program's current interest rate of 2%. Commissioner Johnson asked about the typical rate of a business loan. Chair Helgemoe responded that it depends on what the borrower is trying to finance, but if the loan is a five- year equipment loan, the rate will probably be between 6.5 to 7%, however interest rates also depend on the borrower's risk rating. He also completed some research by talking to a collegue who used to work for the Cities of Oakdale and Roseville and reported that most cities charge between 2 and 6% for loans between $25,000 and $50,000. Commissioner Johnson asked why we would raise the interest rate if the loan program isn't being used. Ms. Steinmetz answered that the most recent loan request from The Station was retracted by the applicant, which prompted this discussion. She added that she is unsure if the policy issue of offering financial incentives to businesses is the EDA's overarching concern. Commissioner Wagner asked if this program is being marketed. Ms. Steinmetz explained that none of the City's financial programs are being marketed due to the EDA's wishes. The EDC further discussed the 2% rate and the consensus was that it should cover the costs to administer the loan and that the rate should be reviewed annually. • Commissioner Belting left the meeting. D. Finalize 2008 EDC Priorities Ms. Steinmetz displayed the reformatted and reordered 2008 EDC Priorities, which were based on the EDC's January 18, 2008 discussion and the 2007 priorities. The EDC's consensus was that the priorities as listed on the screen are what they discussed on January 18th. Staff recommended that the EDC formally adopt the 2008 Priorities and that she will report them to the EDA. Motion/Second: Commissioner Johnson moved and Commissioner Meehlhause seconded the approval of the 2008 EDC Priorities. Motion Carried: 5 Ayes 0 Nays E. Review Economic Development Component of Comprehensive Plan Since the EDC's input regarding the Economic Development portion of the Comprehensive Plan has not changed for two months, Ms. Steinmetz suggested that Commissioner Meehlhause, who serves on the Comprehensive Plan Task Force, and herself provide the EDC's input thus far to the Task Force on March 12th. The EDC agreed that Commissioner Meehlhause would do a great job representing the EDC at the March 12th meeting. EDC Minutes February 15,2008 Not Approved. O s-' J''r��o v ed. Page 5 • F. Internal Public Communications/Marketing Assessment At the January 18th EDC meeting, staff inquired of the EDC's thoughts regarding a marketing and/or communications assessment for the City of Mounds View. The EDC suggested having an intern complete the assessment to save costs. Instead, Ms.Steinmetz completed an in-house assessment in order to save costs and time. She presented her assessment and asked for input specifically on the Mounds View road sign design options that were included in the EDC's meeting packet. She asked for input since the City Council would be deciding upon a design soon. Commissioner Johnson stated that road signs should be easily read and that the trees pictured in the design options should not interfere with the City name. She also said that we have to make sure Mounds View clearly appears as two words instead of one,which seems to be a common mistake, especially with the "MV" logo. Commissioner Wagner said the design option on the far right on page 2 of the assessment has coniferous trees and should be deciduous instead since Mounds View is not a resort town. Commissioner Johnson mentioned that the "MV" logo is dated. Ms. Steinmetz gave the example that New Brighton opted to update their"NB" logo rather than completing a total redesign since the "NB" had been part of the community for so long. Ms. Steinmetz stated that Mounds View could do what New Brighton did and simply update their"MV" logo. She commented that branding can become very expensive but there are ways to minimize costs. The EDC's preferred road sign design option is on the "far right" of page 2 of the assessment. The public communications/marketing assessment discussion will be continued next month when more time is available. 7. REPORT OF COMMISSIONERS Chair Helgemoe reported that the Chamber's annual gala is on Saturday, March 1st at the Mermaid and it's the Chamber's 50th anniversary this year. He encouraged all to attend and mentioned that the event is a major fundraiser for the Chamber. Commissioner Meehlhause mentioned that lrondale student, Nick Stang, won the 2008 State high school boys alpine skiing competition. Commissioner Johnson mentioned that Irondale youth hockey's"B Squirts"are featured on the cover of Let's Play Hockey magazine, a Minnesota-wide magazine. 8. REPORTS OF STAFF A. Medtronic Tour-Wednesday, February 20, 2008 at 8:00 a.m. Ms. Steinmetz reminded the group that another Medtronic tour has been scheduled for February 20th at 8:00 a.m. Commissioner Johnson commented that ever since she toured • the facility in January, she can't stop talking about it. Chair Helgemoe concurred. EDC Minutes February 15,2008 Not Approved Page 6 B. Premium Stop Redevelopment Staff reported that a grant application was submitted for the area and that the City will find out in mid-March if the grant is received. However the City may not be able to use the funds if Robert's is sold in the meantime. There is an interested party who has received a bid to sprinkler the building, which leads staff to believe that the property will be sold soon. Staff does not know who the potential buyer is but will let the EDC know once the purchase agreement is signed. Master Development continues to market the EDA-owned former Premium Stop gas station site and is still looking into the possibility of completing a stand-along project on that particular parcel, however it is still in the City's best interest to expand the project area. The car wash is for sale and the owners don't plan to reopen the facility, so if Robert's becomes unavailable there could be an opportunity to include the car wash in the first phase of redevelopment instead. Chair Helgemoe inquired of Taiko's involvement with the project. Ms. Steinmetz said that the owner of Taiko has hired a real estate broker and that the details would be negotiated between the property owner and a potential developer. Other Ms. Steinmetz mentioned that the City Council has offered the Clerk/Administrator position to Jim Ericson but that the decision has not been formalized via City Council Resolution. In addition, Chamber president Bruce Nustad is moving to a new position. She said it will be sad to see him go. Finally, it is anticipated that Jim Ericson's replacement (a new Community Development Director)will occur in about three months. Although Jim Ericson was not in attendance, Commissioner Meehlhause wished to congratulate him on his new position and was very pleased to see it finally happen. He said it was well-deserved. Commissioner Johnson stated that Jim is a good man. Chair Helgemoe added that Jim is well-qualified and has done an excellent job for the City. Chair Helgemoe also added that Bruce of the Chamber is a super individual, a super talented guy, that we'll miss him and he's done a lot for this area, however Bruce is moving to a Chamber that is twice the size of ours so we can't fault him for that. Chair Helgemoe encouraged people to call the Chamber with any recommendations for Bruce's vacancy. 9. ADJOURNMENT There being no further business before the Commission, Chairperson Helgemoe adjourned the meeting 9:00 a.m. Respectfully submitted, • Heidi Steinmetz Economic Development Specialist • Item Numbers: 6A Meeting Date: March 21, 2008 Type of Business: EDC City of Mounds View Staff Report To: Economic Development Commission From: Heidi Steinmetz, Economic Development Specialist Item Title/Subject: Continue Discussion Regarding Internal Public Communications/Marketing Assessment Background: At the January 18th EDC meeting, staff inquired of the EDC's thoughts regarding the need for a marketing and/or communications assessment for the City of Mounds View. Staff completed the attached in-house assessment to save costs and time. Staff presented the EDC with the assessment on February 15th but due to time constraints, the • EDC was only able to discuss one portion of the assessment in detail; the Mounds View road sign design options. The EDC preferred the option below but recommended that deciduous trees be pictured rather than coniferous trees. Welcome To Est 1858 1 U \\ IEW Interim Clerk/Administrator Jim Ericson provided the Council with the EDC's input at the March 3rd Council Work Session, however the Council appears to be moving forward with the option below: NiI ounds0 Item 6A March 21,2008 EDC Meeting Page 2 of 2 • Recommendation: Staff recommends that the EDC consider the following questions regarding the public communications/marketing assessment: • Is branding something the City of Mounds View should consider? Please see the attached Star Tribune article entitled "Not just suburbs: These cities seek brands", which provides examples of other cities who have "branded" themselves. • Should the City of Mounds View have one consistent logo for all communications (Website, letterhead, newsletter, road signs, water tower, etc.)? • If so, which logo should be used and/or should it be updated or redesigned? • Should the City newsletter be redesigned? • Should the City have a "go to" person for all public communications/marketing? Based on the EDC's input, staff will develop a draft public communications/marketing plan and present it to the EDC at a future meeting. Respectfully submitted, Acd/f&tAtet • Heidi Steinmetz Economic Development Specialist Attachments: • Internal Public Communications/Marketing Assessment • "Not just suburbs: These cities seek brands", Star Tribune, March 15, 2008 • 0 Y a) MI a) 11,CO 0 0 CO 0 N �N 0 fl. 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HANSON,Star Tribune March 15, 2008 To think, Coon Rapids considered ditching its name and its affiliation with raccoons only a couple of years ago. But now there the little critter is, peeking from behind an abstract leaf in a new logo that is part of a brand strategy created by Bloomington public relations firm Tunheim Partners. Big tourist destinations have long taken an interest in brands,from the "I vNY" logo of the 1970s to "What Happens in Vegas Stays in Vegas." Now, ordinary suburbs -- including Hopkins, Burnsville and Savage-- are joining larger cities in trying to cultivate a brand. "In the past, cities have wanted to get information out about what a great place they are to visit," said James Boyle, Tunheim's senior vice president. But now, he said, "there's an interest-- particularly for first-and second-ring suburbs that have an aging population -- • of getting their story out ... to attract new residents and new economic development." Kathryn Henriksen, director of client services for the Minneapolis brand-management firm Brand Tool Box, called branding a new science for cities, one that is more popular now because city officials realize they exist in a competitive marketplace,just as private companies do. "So they're trying to find ways to position themselves, to understand what they stand for, how to appeal to their constituents and attract new community members," she said. In 2006, Hopkins and its business association worked with the firm Citylmage to lure more shoppers downtown and to build awareness of the city's business, educational and arts scene. "Think Hopkins,"the resulting brand campaign and website, debuted early last year. But to begin marketing themselves, cities first need to know themselves. Coon Rapids paid Tunheim Partners about$23,000 to help. The money bought focus-group research, a new logo and a motto that nods to the city's tendency to hold onto residents: "Community strength for generations." The $23,000 that Coon Rapids spent is within the average range for such services, Henriksen said. Anoka recently paid $23,250 to a South Carolina firm for a branding 4111 campaign to be completed in April. Bumsville and Minneapolis expect to be done with • similar branding sessions in the summer. Minneapolis media relations manager Matt Laible said the city is looking for pro bono private expertise to help with a new logo and tagline, which it expects in July. It is using research from Meet Minneapolis, the convention and visitors center behind the $2.5 million "More to Life" campaign. Savage also sought free help and found it from a resident who works in branding. She took the city through a brand "pyramid"exercise to conceptualize the city image. The result was a new tagline ("Naturally resourceful")that communications coordinator Amy Barnett said plays up the city's natural resources and points to how it tries to keep costs low by relying on partnerships. So do the money and time pay off? Boyle said Tunheim has"no research in particular"to demonstrate tangible benefits of branding for cities. But, he argued, it makes sense to pay for outside expertise because marketing generally isn't something cities have done themselves. Eric M. Hanson • 612-673-7517 ©2008 Star Tribune.All rights reserved. • 410 • Item Numbers: 6B Meeting Date: March 21, 2008 Type of Business: EDC City of Mounds View Staff Report To: Economic Development Commission From: Heidi Steinmetz, Economic Development Specialist Item Title/Subject: Discuss 2008 Targeted Business List Background: The 2001 Economic Development portion of the Comprehensive Plan included the following statement: "In order to continuously refine and review its objectives as economic conditions and realities change, the City, through the Economic Development Commission (EDC) and/or the Economic Development Authority (EDA) will annually update its list of targeted businesses and industries." 411 This statement prompted discussion at the March 12th Comprehensive Plan Task Force meeting upon which the Task Force suggested that residents be surveyed via the City's Website or newsletter regarding what types of businesses residents would like to see in Mounds View. Planning Associate Heidi Heller mentioned there may be a possibility to gather similar input at the April 19th Town Hall Meeting. The City previously reviewed its targeted business list annually but discontinued doing so because the list never seemed to change. Furthermore, a documented targeted business list does not exist; however an unofficial list, based on informal/verbal resident input provided to staff is as follows: • Sit-down restaurant • Grocery store • Medical or dental clinic • Optometrist office • Hardware store • Jewelry store • Funeral home • • Florist • Financial institutions (investments, bank, credit union) • Item 6B March 21,2008 EDC Meeting Page 2 of 2 • Discussion: Since the City's Comprehensive Plan is meant to be a guiding document or framework for the future of the community, staff does not feel it is necessary to include a specific statement regarding an annual review of the City's targeted business list. It is important, however that the EDC & EDA discuss its targeted business list as the market changes. A documented list is a public communications/marketing tool and will provide staff with a clear business recruitment focus. Recommendation: Staff recommends that the EDC discuss the following questions regarding a 2008 Targeted Business List: 1. Should the EDA/Council have a policy discussion regarding the main goal of business recruitment? 2. What should be the City's main business recruitment goal, according to the EDC? o To increase the City's tax base with highest and best use development o To create high-wage jobs • 0 To provide residents with goods and services that are not currently available in Mounds View 3. Based on question #2 and the results of the Retail Trade Analysis (presented at the last EDC meeting), are there any changes to the above list of nine targeted businesses? 4. Based on the result of question #3 and the results of the Retail Trade Analysis, how would the EDC prioritize their targeted business list? Staff will provide report the EDC's input to the EDA on April 14th. Respectfully submitted, Heidi Steinmetz Economic Development Specialist Item Numbers: 6C Meeting Date: March 21, 2008 Type of Business: EDC City of Mounds View Staff Report 1111111.1111111111.111 To: Economic Development Commission From: Heidi Steinmetz, Economic Development Specialist Item Title/Subject: Discuss Housing Replacement Program Background: The City's Housing Replacement Program policy was last updated in July of 2007 and is attached for the EDC's reference. The program is geared toward providing demolition assistance through Tax Increment Financing (TIF), which is provided as a ten year/forgivable deferred loan. Discussion: • Staff received an inquiry from a gentleman and his son who wish to purchase and renovate a foreclosed duplex located in Mounds View. The inquiry was regarding housing rehabilitation assistance. Since this type of assistance is not available through the Housing Replacement Program, staff referred the gentleman to the Housing Resource Center. Staff has attached a list of programs available through the Housing Resource Center taken directly from their Web site located at vvww.housing reso u rcecenter.org Staff recently followed up with the above referenced gentleman and although the Housing Resource Center offers rehabilitation assistance, he is not interested in their programs. He plans to submit staff with further insight via e-mail in the near future. Recommendation: Staff recommends that the EDC consider the following questions regarding the Housing Replacement Program: • Does the EDC believe that the Housing Replacement Program policy should be expanded to help address the current housing market? • Does the Housing Replacement Program and the Housing Resource Center 410 programs meet the needs of the community? Item 6C March 21,2008 EDCMeeting Page 2 of 2 • Respectfully submitted, Heidi Steinmetz Economic Development Specialist Attachments: • Housing Replacement Program policy, July 2007 • Housing Resource Center program information • • drd uL"'�r'�. RCA City of Mounds View • a Housing Replacement Program A� (Revised July 2007) S grecs•Partners`4 A. Statement of Purpose The Mounds View Economic Development Authority Housing Replacement Program ("Program") is established to reduce blight, improve residential neighborhoods and increase the tax base. B. Program Objectives • Replace deteriorating substandard housing on scattered sites throughout the City with larger, higher value housing designed for owner-occupied families. • Eliminate the blighting influence of substandard housing. • Increase the availability for quality housing for families. C. Program Funding The Program is funded through Tax Increment Financing and administered by the Mounds View Economic Development Authority(the"EDA"). • D. Data Privacy All files and information, which identifies property and persons, is private and cannot be released. All information secured through the Program is subject to the Data Privacy Act. E. Program Options The Program offers two options for participation. Option 1 — Demolition Assistance: The primary component of the Program involves providing financial assistance to cover the cost of demolishing substandard or blighted property with an agreement that it will be replaced within a specified time frame with a new home that meets certain minimum design standards and area requirements as articulated in Attachment A, Minimum Standards and Requirements. Option 2 - Acquisition: This secondary option involves the purchase of a substandard single- family home and land by the EDA from a willing seller. The EDA will coordinate the site clearance activity and market the site to a developer/owner with an agreement that a new home would be constructed within a specified time frame that meets certain minimum design standards and area requirements as articulated in Attachment A, Minimum Standards and Requirements. City of Mounds View Housing Replacement Program F. Publicizing the Program; Making Application 1. EDA staff, or their appointees ("Program Staff'), will solicit participants by direct mail, advertisement, or other method. The number of applications accepted for participation in the Program will be determined by the availability of personnel and financial resources. 2. Participation in the Program is voluntary. Interested participants must be able to furnish proof of ownership or documented intent to acquire_the property, and are required to submit a letter of application to the EDA indicating: a. For Option 1 (Funding for Demolition): (1) An interest in obtaining funding for demolition from the EDA to replace existing housing with new housing that meets the expressed minimum guidelines of the EDA. (2) Consent to hold the EDA harmless for demolition activities. (3) Consent to enter into a legal development agreement with the EDA regarding redevelopment of the property. (4) Ability to produce proof of construction financing. b. For Option 2: (Sale of Property to EDA): (1) An interest in selling their property to the EDA. • (2) A willingness to waive relocation benefits. (3) Statement affirming that the property is either vacant or owner-occupied at the time of offer. (4) Consent to the release of relevant information to potential developers and end buyers. 3. Individuals who have expressed an interest in participating will be contacted by Program Staff to inform them of the estimated project time line and to obtain complete information on the items noted under F.2. above. G. Property Eligibility Criteria Program Staff will evaluate each property for which an application is received to determine Program eligibility based on the criteria in this section. Program Staff will prepare property fact sheets for each property for which an application has been received and will conduct an interior and exterior inspection of each property. Properties will be evaluated based on the criteria outlined below. To be eligible for participation, the house must be previously identified by the EDA as a potential acquisition (Option #2 only) and the property must have one of the characteristics noted in 1, 2, 3, 4 or 5 below: 1. Substandard as to condition, code compliance, size or usage. 2. Obsolete and having a faulty design for block and area in which it is located. 3. Deterioration which has caused blight to other adjoining properties. • 4. Detrimental to the safety or health of abutting properties in the block. 5. Foreclosed upon or notice of foreclosure has been served on occupant. Page 2 City of Mounds View Housing Replacement Program • If it is determined that the property is eligible for participation based on the condition of the house as expressed in characteristics 1-5 above, it must also meet the following criteria as outlined in 6-8 below. 6. The site can be developed with a single family home within city code requirements, including zoning and conformance with the Comprehensive Plan. 7. The property must be owner-occupied or vacant before the owner or_owner's designee makes application to the Program. Non-homesteaded vacant property will be considered for demolition assistance or acquisition. Tenant-occupied properties will not be considered for participation. 8. Prior to approval by the EDA for participation in the Program,properties over 50 years old must be evaluated for historical significance. This will be accomplished by forwarding general property information and a property photo to the Minnesota Historical Society for review. The EDA will not enter into a purchase agreement or award funding for demolition of a property which qualifies for the National Registry of Historical Structures. H. Program Priorities If more than one application for demolition funding or acquisition has been received during a given month, the Program Staff shall rank the applications to determine the best candidates for Program participation based on the information and criteria noted below and in the following order: • 1. Properties that can meet established guidelines and time frame will be considered first. 2. Properties considered the most substandard will be considered first. 3. Requests submitted by Mounds View residents will be considered first. 4. Applicants who have expressed a funding "need" shall be considered first over applicants with little to no "need". 5. Properties should be equally distributed by location and value throughout the City when possible, and provide a viable financial mix of properties to support Program financial requirements. I. Option 1: Funding of Demolition: 1. Blight Qualification: Properties being considered for demolition funding must meet blight qualifications as outlined in Section G. Applicants shall demonstrate proof of construction financing in a form acceptable to the City. 2. Need for Variances: If a variance is required to redevelop the property, the homeowner must obtain the variance prior to the approval of demolition funds. If a variance is not granted, demolition funds shall not be awarded. • 3. Comprehensive Plan/Zoning: The Comprehensive Plan designation and the zoning on the property must allow for its redevelopment as a single-family residence. Page 3 City of Mounds View HousingReplacementProgram Pro ram • 4. Development Agreement: The applicant must enter into a Demolition and Redevelopment Agreement with the EDA which will stipulate housing design and site development features consistent with the guidelines attached in Exhibit A (Housing Design and Site Criteria) and identify the time frame for completion. The development agreement will include an estimate of the minimum value of the home to be constructed. 5. Demolition Contract: The applicant must obtain three estimates for demolition from qualified demolition contractors which will assist in determining the amount of demolition funds to award for the project. The total amount of assistance provided shall not exceed the lowest responsible estimate received not to exceed $10,000. The selected demolition contractor must be able to meet project deadlines as outlined by City Staff. The demolition contractor will be required to obtain all necessary City permits, pay applicable fees and provide for appropriate handling and abatement of any hazardous materials encountered. Overall demolition supervision will be provided by a designated Program Staff in conjunction with the interested participant. 6. Funding Mechanism: The assistance will be provided to the applicant upon conclusion of the demolition activity and satisfactory final inspection of the demolition permit, in the form of a ten year forgivable interest-free loan, with a 10% incremental reduction in principal upon each successive year the participant lives in the new home, with complete forgiveness after the tenth year in the home. The annual reduction in principal is tied to the date of • completion/owner-occupancy of the new home and not to the loan closing. If the participant sells or rents the home to a third party prior to the tenth year, the following loan repayment schedule shall apply: If the home is sold before The amount to be repaid upon closing shall be End of the first year, 100% of the loan amount End of the second year, 90% of the loan amount End of the third year, 80% of the loan amount End of the fourth year, 70% of the loan amount End of the fifth year, 60% of the loan amount End of the sixth year, 50% of the loan amount End of the seventh year, 40% of the loan amount End of the eighth year, 30% of the loan amount End of the ninth year, 20% of the loan amount End of the tenth year, 10% of the loan amount After the end of the tenth year, the applicant will be provided with a lien release and the necessary paperwork to record at Ramsey County. The loan shall be administered by the Housing Resource Center, NorthMetro Office, a division of the Greater Metropolitan Housing Corporation (GMHC). The Housing Resource Center or 41111 GMHC shall prepare lien release and satisfaction documents as needed. Page 4 City of Mounds View Housing Replacement Program • J. Option 2: Acquisition of Property by EDA 1. Blight Qualification: Once an offering letter is received from the interested participant, Program Staff will arrange, by appointment, an inspection of the interior of the home to establish blight qualification as outlined in Section G. In addition, Program Staff will make a determination as to the potential presence of hazardous materials on the property and will obtain a statement from the interested participant regarding any knowledge of the property's use for production, storage, deposit, or disposal of any toxic or hazardous wastes or substances or asbestos products whatsoever, during the time the interested participant owned the property and prior to the date of interested participant purchased property. Properties with recognized environmental conditions or hazards may be considered if the purchase price is reduced sufficiently to cover increased site clearance and preparation costs. If a property satisfies the blight conditions as outlined herein, acquisition procedures can continue. If the blight test cannot be met, the interested participant will be notified in writing indicating the reasons why the property cannot be considered for acquisition. 2. Need for Variances: If a variance is required to redevelop the property, the EDA may, at its sole discretion, choose not to acquire the property. This determination will be made based on the project time lines, available resources, and availability of other properties which do not require a variance. If the EDA chooses to pursue a variance to enable the acquisition of the property, an application shall be filed following the usual procedures. If a variance is not • approved, the property cannot be considered for acquisition. 3. Appraisal: Determining Purchase Price: If the EDA chooses to continue with the acquisition, a fee appraisal shall be ordered at the EDA's expense and the result shall be used in det-rmining the amount of the purchase price to offer to the interested participant. The independent fee appraiser shall be carefully instructed to document in specific terms the conditions of the property including details regarding structural condition and floor plan. The acceptance of these conditions in the market place should be discussed in the report. The appraiser's value judgment should reflect these conditions. A negotiated price considerably below the assessor's market value may be accepted without an appraisal on a case by case basis if the interested participant concurs. 4. Purchase Agreement: Closing Procedures a. When both parties have verbally agreed upon a purchase price, Program Staff and Legal Counsel shall prepare a Purchase Agreement to be presented to the interested r participant. The purchase price contained in the Purchase Agreement shall be within the range authorized by the EDA. The purchase agreement shall be contingent on the completion of an environmental evaluation suggesting no evidence of hazardous waste on the property. The interested participant shall receive a copy of the purchase agreement including the following information: • Page 5 City of Mounds View Housing Replacement Program • (1) The purchase price (2) How the purchase price was determined (3) The amount of earnest money (4) A date to sign the Purchase Agreement (5) A closing date b. To enable the acquisition process to continue, the interested participant must execute the purchase agreement and a "waiver of relocation benefits" form. The waiver of relocation must be clearly explained by City staff to the interested participant at this time, if not explained previously. c. The EDA Executive Director and President shall be signatories on the purchase agreement. d. The acquisition and disposition of the property must be in conformance with the Mounds View Comprehensive Plan. e. Following EDA authorization of these agreements, interested participants and/or Program Staff will be requested to assemble and supply all required documentation prior to closing as outlined below. (1) Title documentation acceptable to City staff must be furnished to the • Program Staff to facilitate the rendering of a title opinion. The interested participant will bear the cost of updating the Abstract or RPA as part of the closing procedures. (2) EDA Legal Counsel shall review the submitted title documentation and will provide Program Staff and interested participant with a written opinion of title. EDA Legal Counsel will also secure title insurance. (3) If the title opinion indicates the property has marketable title, purchase procedures may continue. If the title opinion does not indicate marketable title, the EDA, at its sole discretion, may choose not to acquire the property. The EDA may determine remedies and evaluate their resolution, including the additional time and expense to provide marketable title. It shall be the seller's responsibility to correct title deficiencies to effectuate the sale of the property dependant upon the additional time and expense incurred. (4) Simultaneously with the title opinion, an environmental evaluation will be obtained from an independent environmental engineering firm or other firm performing such service. If environmental hazards are found on the site, the EDA may choose not to acquire the property. S Page 6 City of Mounds View Housing Replacement Program • f. The seller must be prepared to vacate the property on the day of closing unless other arrangements have been made with Program Staff. g. If the interested participant decides not to sell the property after execution of the purchase agreement then the interested participant must provide the EDA with the following: (1) A letter expressing their desire not to proceed with selling the property (2) The full amount of earnest money received upon execution of the purchase agreement, and (3) Full payment of legal and consulting fees incurred by the EDA after the execution of the purchase agreement in preparation for the closing of the property. 5. Selection of Demolition Contractor and Procedures: After the closing, Program Staff will select a demolition contractor by sending Requests for Proposals (RFP) to at least three demolition contractors. The proposal received with the lowest price will have priority. The demolition contractor must be able to meet project deadline as outlined in the RFP. The demolition contractor will be required to obtain all necessary City permits and pay applicable 411 fees. A Program Staff person will provide demolition supervision. 6. Marketing: Program Staff will advertise the sale of the property by contacting the St. Paul Realtors Association, area residential developers, interested buyers and by posting signs on the property. 7. Selection of Developer: Program Staff will negotiate the purchase of the property with an acceptable buyer/developer or buyer/builder team. If a buyer/developer or buyer/builder team cannot be obtained, the EDA may consider selling property to a developer or builder for sale to the open market after completion. As part of the sale of the property, the buyer/developer team purchasing party must sign a purchase and redevelopment agreement with the EDA, which will stipulate minimum standards, housing design and time frame for completion. (Refer to Exhibit A, Housing Design and Site Criteria guidelines, attached.) 8. Development Agreement: Closing Procedures a. When a redevelopment proposal submitted by a buyer/developer or buyer/builder team has been approved by the EDA, Program Staff and Legal Counsel will prepare a Purchase and Redevelopment Agreement. The selected developer will receive a copy of the Purchase and Redevelopment Agreement which will include, but not be limited to, the following information: Page 7 City of Mounds View Housing Replacement Program S (1) Construction of minimum improvements (2) Estimated market value of the property and improvements (3) Purchase price (4) Completion date (5) Financial guarantee submitted by the developer with a minimum amount equal to 100% of the minimum improvement value (6) Revesting of Title. Subject to unavoidable delays, if the Developer fails to carry out its obligations with respect to the construction of the Minimum Improvements, the Authority will have the right to re-enter and take possession of the property. The Authority at its option may declare a termination in favor of the Authority of the title and that the title and all rights and interests of the Developer will revert to the Authority. Economic Development Authority By: EDA President By: EDA Executive Director Revised: July 2007 • Page 8 EXHIBIT A. • Housing Replacement Program HOUSING DESIGN AND SITE CRITERIA (July 2007 revisions) The Mounds View Economic Development Authority (EDA) established the Housing Replacement Program to reduce blight and increase the tax base. The purpose of the program is to replace deteriorating lower value housing on scattered sites throughout the City with larger, higher value housing designed for families. The program promotes these goals through two different mechanisms— providing demolition assistance to remove sub-standard, blighted and distressed properties, and acquisition of substandard, blighted or distressed homes. In either case, the subject property is demolished and a new, larger, higher-value home is constructed in its place. The program will assist in eliminating the blighting influence of substandard housing and increase the availability of quality housing for families. 1. General a. The developer must enter into a Contract for Private Development with the EDA which will specify design, set site criteria and establish value based upon new home construction in the surrounding area. • b. The builder must be a licensed contractor. All sub-contractors must also be licensed. Homeowner sweat-equity labor on interior finishes may be permitted. c. Home design must comply with all federal, state and local building codes. d. The house must be able to be built within six (6) months from the time the Contract for Private Development is executed. An extension may be granted with the permission of the EDA. e. Each home must be single-family, owner occupied. 2. Building Standards a. All building plans must have been prepared in consultation with a licensed Architect or Architectural Designer. Housing design is a critical concern. b. A minimum of three finished bedrooms is required. c. Two full bathrooms are required. • d. A minimum two-car attached garage is required. Side-loaded or rear-loaded garages are preferred. If front-loaded, the garage shall not be the dominant feature of the building facade. City of Mounds View Housing Replacement Program e. Exterior materials (siding, doors and windows) should be low maintenance. _Brick, stone, aluminum and vinyl are preferred. Natural cedar lap is acceptable if properly stained or painted. Hardboard panels or hardboard lap siding are not acceptable. f. Plans must present a balanced distribution of wall and window areas from all views. A variety of exterior architectural features will be desired. g. A full basement shall be provided in the house unless the selected design results in a split level, garden level type of basement. 3. Site Standards a. The entire grounds must be landscaped to be aesthetically pleasing in all seasons. Land forms and plant materials shall be used to define the site and blend with adjoining properties. The landscape plan must be reviewed by the City Forester. b. Existing trees must be preserved when possible. Care should be taken to preserve existing root systems. Construction fencing around the root system must be provided on trees directly adjacent to active grading and construction areas. The City Forester can assist in recommending methods of protecting existing trees and shrubs. c. Site drainage must be accommodated on the site so that water is directed away from the • new home and the neighboring properties. The developer must comply with any federal, state or local drainage requirements. Construction and the finished structure must not have a detrimental impact on storm water drainage patterns in the neighborhood. d. All air conditioning units must be located in the rear yard of the house. e. Utility meters must be screened from street view; locations must be specified on plans. f. The neighboring property and adjacent public streets must be kept free of construction debris at all times. The construction site must be managed so not to become a nuisance. Under no circumstance during the construction period may construction workers, construction equipment or construction materials enter, disturb, or damage neighboring properties. 4. Builder Requirements a. Demonstrate financial capability by providing all of the following: S Page A-2 City of Mounds View Housing Replacement Program (1) A statement from a financial institution of sufficient construction capital (2) A letter of credit of the value of the lot (3) A summary of the financial conditions of the company (4) Evidence of a construction loan or ability to secure one b. Possess adequate Builder's Risk, Comprehensive General Liability and Worker's Compensation insurance coverage. c. Possess a Home Owners Warranty insurance or equivalent to perform warranted repairs required by Minnesota State Statute. d. Provide references from all of the following: (1) Five customers; (2) Three major suppliers, one being the construction lumber supplier; (3) Building Inspectors from two cities in which the builder has constructed new housing within the past three years. e. Provide information on inventory of homes that builder currently has under construction. • 5. Buyer Requirements, if applicable a. Must be pre-approved for permanent financing prior to allow signing of Contract for Private Development. • Page A-3 • Housing Resource Center Programs Mounds View Manufactured Housing Program: This program contains two deferred loans for the Mounds View Manufactured Home Community: 1)for the borrower's down payment and/or closing costs for the mortgage being used to finance the purchase of a new manufactured home and 2)for the borrower's rehabilitation of an existing manufactured home.A 0%interest loan for a maximum of$5,000 is available for purchasing a home, and a 0%interest loan for a maximum of$3,000 is available for rehabilitating the home.The loan is forgiven after 5 years unless the property transfers ownership before 5 years.To qualify for a loan the borrower must be at or below 80%of the area median income. MHFA Fix Up Fund Loan: This is a home improvement loan for a maximum of$35,000 and a maximum term of 20 years,with a fixed rate for the term of the loan. Please contact the HousingResource Center for the current interest rate.The Fix Up Fund loan is available to credit worthy owner-occupied single-family homes,duplexes,triplexes and fourplexes.The maximum income to qualify for the loan is$89,000,and most home improvements qualify except for luxury items, such as swimming pools.This is a program of the Minnesota Housing Finance Agency(MHFA). MHFA Rental Property Loans: Maximum loan up to$100,000 to finance rental property.($25,000 for a single-family home or duplex;$10,000 per unit in a multiple-unit dwelling.)Interest rate is 6%for up to 15 years. MHFA Rehabilitation Loan: This loan is a 0%interest,30-year loan for financing up to$15,000 for permanent repairs to the home.The loan is deferred so homeowners have no interest or monthly payments. Eligible homeowners must have incomes at 30% • area median, and eligible properties include single-family homes,duplexes and manufactured housing taxed as real or personal property. In addition, homeowners with a disability and/or lead abatement issues can qualify for a maximum loan of$20,000.This is a program of the Minnesota Housing Finance Agency(MHFA). Home Improvement Advice: Our construction managers provide free construction consultations to residents of partnering communities.These services include: . Site Visits with Homeowners . Contractor Information . Create a list of work for contractors to bid from . Review contractor bids, proposals,estimates . Accessibility Modifications . Health and Safety issues Housing Information: We provide information on a variety of housing related topics.They include: . Home Maintenance and Safety Topics . Home Improvement Financing . First Time Homebuyer Classes . Limited Rental Information . Mortgage Foreclosure Prevention Programs . Energy Assistance Programs . Purchase and Rehabilitation Mortgages • • Item No. 8A Meeting Date: March 21, 2008 Type of Business: EDC City of Mounds View Staff Report To: Economic Development Commission From: Heidi Steinmetz, Economic Development Specialist Item Title/Subject: Economic Development Component of the Comprehensive Plan The Comprehensive Plan Task Force reviewed the Economic Development component of the Comprehensive Plan on March 12th. Commissioner Meehlhause serves as the EDC's representative on the Comprehensive Plan Task Force. Staff incorporated the EDC's input, received over the course of several months, into the attached version of the Economic Development component of the • Comprehensive Plan. Staff also reorganized and reformatted it so it's easier to read and consistent with the other sections of the Comprehensive Plan. Staff offered to further wordsmith the document based on input received at the March 12th Task Force meeting. Another draft will be brought back to the Comprehensive Plan Task Force on April 9th S • ECONOMIC DEVELOPMENT ELEMENT • • Introduction The intent and content of Mounds View's Economic Development element is directed towards future business development(both retention and recruitment)and redevelopment within the community. It is important to maintain and improve the quality and diversity of existing and prospective Mounds View businesses and to embrace redevelopment opportunities in order to enhance the City's tax base through such things as creating additional market value through building enhancements or new buildings and the creation of jobs. Goals & Policies Future Economic Development in Mounds View will be governed and directed by the following set of goals and policies. Business Development Goal: Retention In light of the increasing mobility of businesses in general,the City will focus on retaining existing businesses and industries in the community,in some cases by helping to create circumstances under which they can expand to meet their customers' needs and/or their own desire to grow and prosper financially. • Retention Policies • Retain existing businesses that make positive contributions, such as job creation,to the local economy by... • Make available a reasonable and prudent level of assistance (financial or otherwise) to enable existing businesses to expand their operations and/or facilities in Mounds View. Business Development Goal: Recruitment The City will actively market itself to selected target audiences as a prime location for specific types of commercial and industrial development. In order to continuously refine and review its objectives as economic conditions and realities change, the City, through the Economic Development Commission(EDC)and/or the Economic Development Authority(EDA)will annually update its list of targeted businesses and industries. Although the City will respond in a timely and businesslike manner to all requests for information about the City's suitability as a business location, City staff members will focus their attention on those requests that come from businesses of the type that appear on the City's target list. The City will encourage the development of new office space,warehouse space and retail operations that will enable Mounds View to offer services, facilities and goods that are not presently available • in the community or that are unavailable in sufficient quantity or quality. 2 • Business Retention&Recruitment Goal The City recognizes that the maintenance of an adequate workforce will be one of the most serious challenges that will face business and industry for much of the foreseeable future, and that the private sector and/or educational institutions will be primarily responsible for addressing and resolving workforce issues. However, the City is prepared to assist with such efforts by working collaboratively with others who are concerned about such issues. The nature of the City's assistance may include having City representatives serve on local and regional committees, commissions and agencies devoted to this important topic Redevelopment Goal Since the City is almost fully developed, the City intends to devote significant attention to redeveloping aesthetically displeasing,aging,obsolete,blighted,contaminated,abandoned,unsafe or otherwise underdeveloped properties. Additionally,the City will explore the opportunities that are presented by the few remaining parcels of undeveloped property. In some cases this may involve assisting the owners of such parcels with the marketing of their properties to prospective developers. Redevelopment Policies • The redevelopment or expansion of an existing business, new commercial or industrial development, or residential housing will be considered even if it involves the possible acquisition, demolition or relocation of an existing business or residential homes. • The redevelopment or expansion of an existing business, or new commercial or industrial development, or residential housing will be considered if a reasonable opportunity for public input has been provided,particularly by those business owners and homeowners who could potentially be affected. Whether or not such parties support(or, at a minimum, do not oppose)any proposed redevelopment,expansion, new development or new project will be one of the more important factors in determining the City's position with respect to any such proposal. In the final analysis,the City's goal will be to determine whether the actual or potential benefits to the City (from any such proposal) outweigh the actual or potential negative impacts on individuals,businesses or the community as a whole. Miscellaneous Economic Development Goals Facilitate communications between and among the City, Ramsey County, local businesses, the Chamber of Commerce, local educational institutions, and any other parties or entities having a direct or indirect interest in the continued economic prosperity of Mounds View. The City will continually develop and review more specific priorities in order to provide guidance to • City staff,business owners,developers,and residents with respect to intended areas of concentration (geographic and otherwise). 3 • RESOURCES TO SUPPORT ECONOMIC DEVELOPMENT Resources to support Economic Development can be defined as any facts,programs or circumstances that enhance Mounds View's ability to attract new businesses,retain and expand existing businesses, or assist in the preservation of a vibrant, diverse local economy. Such resources currently include the following: • Close proximity to Interstate 35-W, allowing relatively quick and easy access to the downtown areas of Minneapolis and St. Paul, and to other portions of the Twin Cities metropolitan area. • Good internal traffic circulation and the City Council approved (2007) Street & Infrastructure Improvement Program (first project to begin in 2009) • Successful, attractive business parks. • Visible evidence of new commercial activity, storefront improvements, remodeling, and other indications of local economic health. • Ongoing efforts to enhance the appearance of, and to better coordinate planning for the • further development of, the County Highway 10 corridor and the community at large. • Local business owners who are interested in expanding their operations and improving the appearance of their properties. • The potential availability of City assistance for appropriate development or redevelopment projects such as Tax Increment Financing(TIF),Tax Rebate Financing(TRF),the Business Improvement Partnership Loan Program and the Housing Replacement Program. These types of City assistance have been,and will continue to be,provided in a manner consistent with the City's written policies regarding such assistance, and will generally be limited to situations in which their use will enable the City to attract a new business,retain or expand an existing business,provide new employment opportunities,enhance the City's tax base,or otherwise improve the appearance or vitality of the local business economy. The City will continually monitor and periodically evaluate its programs and policies regarding development and redevelopment assistance in order to make certain that they are helping the City meet its economic development goals, priorities and objectives. • Parcels of land that are suitable for development or redevelopment. • An active local Chamber of Commerce. • A coordinated approach to local planning and development issues, as evidenced by the ongoing work of the I-35W Corridor Coalition. • 4 • • A plentiful supply of life-cycle housing to accommodate a wide range of incomes. • Easy access to mass transit for workers who need or prefer to use such methods of transportation. • The proximity of the Anoka County Airport in Blaine. • A highly ranked school district ECONOMIC DEVELOPMENT CHALLENGES The effectiveness of local economic development can be enhanced by continuously assessing, and attempting to address, any circumstances that might negatively impact the local business climate. Such circumstances may include those that might: • make a developer or business owner less inclined to establish a new business in Mounds View; or • make a developer or business owner less inclined to relocate an existing business to Mounds View; or • make an existing Mounds View business less inclined to expand its operation in Mounds View; or • make an existing Mounds View business consider moving its operation to another community; or • adversely affect, in some other way, the ability of an existing Mounds View business to achieve economic success. The preceding circumstances are,to varying degrees,mitigated by the presence of financial and other incentives that encourage or allow economic development. Successful economic development will continue to require the careful monitoring of these existing and developing challenges so that realistic and timely efforts can be made to emphasize Mounds View's many positive attributes in order to effectively minimize or counteract negative perceptions or circumstances.Examples of such future efforts may include the following: i 5 • In order to address the relative scarcity of raw land suitable for new construction, and in light of the small size of the few remaining parcels of undeveloped land, o Prepare and periodically update an inventory of undeveloped land, o List undeveloped parcels on the City Web site with the knowledge and consent of their owners/agent, o Acquire and/or clear underdeveloped sites suitable for new construction, o Focus development efforts on businesses suitable for smaller lots,and investigate the possibility of combining adjoining lots to accommodate larger businesses. • In situations involving unrealistic price expectations on the part of those who own undeveloped or parcels of land prime for redevelopment (i.e., asking prices well in excess of actual market value), o Wait for the market to catch up with currently excessive asking prices and o Investigate options that might reduce those prices (offering relocation assistance, etc.). • In cases involving actual or perceived neighborhood opposition to commercial development of certain types in certain areas, • o Survey nearby residents to determine their preferences and/or o Arrange neighborhood meetings or public hearings in connection with proposed commercial development(s). • In situations where owners of underdeveloped parcels (especially residential homeowners and owners of old or obsolete commercial structures) are unwilling to sell, thereby delaying or preventing the development of those properties to their highest and best use, o Arrange meetings with the owners, o Provide current information to them regarding the potential market value of their properties, o Develop or refine City relocation policies, or o Consider the use of eminent domain only as a last resort. • In order to strengthen Mounds View's identity, o Ensure a consistent image via branding, o Continue work on the development and improvement of County Highway 10, o Maintain a high profile within the local and regional business communities, o Attempt to develop a greater sense of community, and o Handle business climate inquiries promptly and professionally. • 6 • Given the scarcity of attractive office space and rental warehouse/office space, encourage new construction to meet these needs. • Due to the potentially high cost of some of the available methods of aggressively recruiting the most attractive new business prospects and/or marketing Mounds View as a business location, investigate and use the more cost-effective and/or more carefully targeted recruitment/marketing techniques. • Inasmuch as limited funds are available for the funding of business incubator programs, enterprise facilitation projects or other initiatives designed to help new businesses get started locally, o Pursue grants to fund such programs, o Establish collaborations with other governmental entities and non-profit organizations, and o Serve as a clearinghouse for information about assistance(financial and otherwise) that may be available from sources other than the City. • In light of the limited selection of tools that are available to the City to finance or promote • economic development, monitor developments affecting economic development and(where appropriate) make recommendations regarding alternative, new or improved methods of providing advice, assistance or encouragement. • Due to the high cost of redeveloping property vs. developing property,participate in seeking creative solutions to the financing challenges inherent in potential redevelopment projects. • 7 Item No. 8B Meeting Date: March 21, 2008 Type of Business: EDC City of Mounds View Staff Report To: Economic Development Commission From: Heidi Steinmetz, Economic Development Specialist Item Title/Subject: Final Version of the Mounds View Business Toolbox The EDA approved the Mounds View Business Toolbox on March 10th. The final version is attached for your reference. • • Mounds View Business Toolbox • City of Mounds View Economic Development Internal Document Adopted by the Mounds View Economic Development Authority March 10, 2008 • • Table of Contents Site Location Assistance Page 3 Development Review Services Page 3 Business Development Programs Pages 3-5 Workforce Development Programs Pages 5-6 Business Finance Loans & Grants Pages 6-10 Appendices Appendix A Business Subsidy Policy Appendix B Business Improvement Partnership Loan Program • Appendix C Tax Rebate Financing (TRF) Policy Appendix D Tax Increment Financing (TIF) Policy • March 10,2008 Mounds View Business Toolbox Internal Document Page 2 of 10 • Mounds View Business Toolbox The Mounds View Business Toolbox is an internal document to the City of Mounds View Community Development Department. The Toolbox is intended to serve as a summary document listing the financial and technical resources available to existing and prospective Mounds View businesses. Any financial assistance available by the City of Mounds View is at the discretion of the Mounds View Economic Development Authority (EDA) and must coincide with the EDA's priorities and objectives. A. Site Location Assistance The City of Mounds View maintains information on development opportunities within the community. These include vacant parcels, available building spaces, and redevelopment properties. Comprehensive plan, zoning, street, water, sewer, utility, and other maps are available for businesses, developers, realtors, engineering and architectural firms. B. Development Review Services • Businesses considering Mounds View as an expansion or relocation are encouraged to contact staff at the Mounds View City Hall for various services, including construction and building services, licenses, and zoning reviews. The Community Development staff evaluates developer proposals and reviews project plans that are presented by businesses and/or architectural/engineering firms. As such, staff does consider setbacks, permits, and rezoning that may facilitate projects. C. Business Development Programs The City of Mounds View collaborates with several other entities that provide services to our local businesses. These include the Twin Cities North Chamber of Commerce (located in Mounds View), the DEED Small Business Development Center (in Minneapolis), and the Ramsey County Workforce Investment Board (also referred to as Workforce Solutions, located in North St. Paul). • March 10,2008 Mounds View Business Toolbox Internal Document Page 3 of 10 • In addition to several annual events, the Twin Cities North Chamber of Commerce hosts these monthly business education and networking events: 1) Twin Cities North Chamber of Commerce —www.twincitiesnorth.org A. Breakfast Club This activity occurs twice monthly and is held at the Mounds View Community Center. The Chamber hosts a formal morning breakfast networking event attended by area member businesses. The event attracts traditionally 30 participants interested in marketing their organization and exchanging best practice ideas. The group meets the second and forth Thursday at 7:30 a.m. The cost is $5 per person. B. Business Smartz The Chamber provides a practical business education forum in its guaranteed Business Smartz Seminar series. The Business Smartz program takes place the first Tuesday of the month, traditionally in the morning. This hour and a half long seminar is focused on educational topics that are practical and beneficial to business owners and key management in small to mid-sized organizations. Topics vary. The cost per event is $15. • C. Evening Exchange Evening Exchange is a monthly afternoon networking event-taking place at an area business. Evening Exchange is designed to create a relaxed networking environment where business professionals from all company sizes can discuss partnership opportunities and exchange ideas. The event generally occurs the second Wednesday of the month. Location varies. No cost except for beverages. D. Monthly Educational Luncheon The TCN Chamber hosts a monthly networking and educational luncheon. The event includes an average of 50 participants and is intended to connect with both new area businesses as well as those with deep roots in the community. A featured presenter discusses issues pertinent to members in the northern Twin Cities suburbs. Location varies. Cost is $16 per person. E. north yp network As an offering geared toward early stage business professionals, the north yp network serves as the Chamber's young professionals networking and education group (ages from 21 to 35+/-). The north yp network holds events twice a month: one social/networking; one educational. The group self directs its agenda and is run by an active committee. Location and • cost varies. March 10,2008 Mounds View Business Toolbox Internal Document Page 4 of 10 2) DEED Small Business Development Center (SBDC) —www.mnsbdc.com The state's SBDC offers individual advice and guidance concerning the formation, management, financing and operation of businesses. Counseling is provided at no charge to qualified businesses, although there may be a fee for certain out-of-pocket costs incurred by the SBDC. To qualify for counseling, the business must be "small" as defined by the U.S. Small Business Administration. Individuals who are considering starting a business are also eligible for counseling. How does the program work? The client must sign a "Request for Counseling" form and must agree to participate in surveys designed to measure the effectiveness of the SBDC program. To maximize the value of the counseling, clients should prepare a draft business plan before meeting with the counselor. SBDC counselors have significant experience in the private sector, and many have extensive management and financial consulting backgrounds. To learn more about the services, Mounds View businesses can contact the local SBDC office located in at the University of St. Thomas (Minneapolis campus). You can contact Michael Ryan at 651-962-4500. 3) DEED Business Services DEED Business Services staff serve the business community in Ramsey County, • and around the state, with business development and workforce-related services. Services including helping startup and expanding businesses, coordinating specialized business development products and services to employers, brownfield redevelopment assistance, and labor market information. Local businesses can contact Cheryl Beaumier, Business Services at 651-779-5645. D. Workforce Development Programs P J Minnesota WorkForce Centers (WFCs) provide the tools, resources and services needed for job search, career planning and training needs. WorkForce Centers are a collaboration of partners. People seeking work, businesses seeking employees, students, and those looking for a first job or returning to the workforce, will find services to meet their needs, most offered at no cost. Each WFC house houses a Resource Area that operates similar to a library. The Ramsey County WorkForce Center that services businesses in the City of Mounds View is located in North St. Paul. The Center provides a variety of services to employers to meet their employee recruitment and retention needs. Some services provided include training seminars, training grants, job fairs, and wage subsidies to name a few. Businesses may contact Cheryl Beaumier, Business Services at the Minnesota Department of Employment & Economic Development at 651-779-5645. • Businesses can also visit the Department's website at www.deed.state.mn.us. Some of the workforce programs available to employers include: March 10,2008 Mounds View Business Toolbox Internal Document Page 5 of 10 1) Minnesota's Job Bank The Minnesota Department of Employment and Economic Development (DEED) is responsible for administering various state and federal programs that provide workforce development services. Minnesota's Job Bank is an Internet-based self-service system where member employers and job seekers can find each other. Employer members can post job openings to be searched by job seekers. Employer members can also search for job candidates and contact them by email. Job seeker members can post a resume to be searched by employers. Members can also search for job openings, contact employers by e-mail, and apply online. 2) Work Opportunity Tax Credit (WOTC) & Welfare-to-Work Tax Credit (WtW) WOTC allows employers to take a federal income tax credit when they hire persons from certain targeted groups. For most groups, the maximum credit is 40% of the first $6,000 in qualified wages for a savings of $2,400. The WtW Tax Credit is a two-year program involving the hiring of long-term family assistance recipients that provides tax savings up to $8,500 for each eligible new hire. 3) Customized Training Programs. The Metro Consortium for Customized Training is an association of the • Customized Training divisions of the 10 metropolitan area community and technical colleges and Metropolitan State University. It facilitates customized training for Minnesota employers using the expertise and resources of the 10 institutions. For example, Anoka-Ramsey Community College has collaborated with the Consortium and customized training programs for various occupations pertaining to the medical device industry. 4) Minnesota Vocational Rehabilitation (VR) Program The VR Program helps Minnesotans with significant disabilities get ready for, find and keep their chosen jobs and careers. E. Business Finance Loans & Grants For both existing businesses desiring to expand and for businesses new to the City there are federal, state and local financial assistance programs. All local financial assistance is at the discretion of the Mounds View EDA and is governed by the City's overarching Business Subsidy Policy, which is attached as Appendix A. 1) Small Business Administration Loan Programs — SBA 504 Loan / 7a Loan The U.S. Small Business Administration provides a wide array of programs to help small businesses, including financial and federal contract procurement assistance, management assistance, and specialized outreach to women, minorities, and veterans. March 10,2008 Mounds View Business Toolbox Internal Document Page 6 of 10 • The SBA 504 Loan program provides fixed-rate, long-term financing for land, buildings and manufacturing equipment or machinery. SBA 504 Loans feature a 10 to 20 amortization, fixed-loan payments, below market interest rates, and a low downpayment. The deal structure is 50% bank loan (1st position), 40% SBA 504 (2nd position), and 10% equity injection. (A new business and a special- purposed building require 20% equity injection.) The program's minimum and maximum loan amounts are $50,000 and $750,000 respectively. How does the program work? Businesses should contact the certified development company authorized by SBA to originate and service SBA 504 loans in their geographic area. SPEDCO is a non-profit certified development company located in New Brighton whose mission is to help small businesses obtain financing for job creation, to fund business expansion and to promote economic development in Minnesota. SPEDCO can handle SBA Loan financing for businesses wishing to expand or locate in Mounds View. They provide long-term, fixed rate loans through the SBA 504 Loan program and also provide 7(a) loan packaging consulting services to banks and their customers. For more information call 651-631-4900. 2) State of Minnesota Business Financing Programs The Department of Employment and Economic Development encourages the • creation of high quality jobs through business growth, expansion and retention. Business Development Services help companies expand or relocate in Minnesota, find and train employees, promote international trade, and finance business expansions. The most likely funding program applicable to Mounds View businesses would be the Minnesota Investment Fund (MIF). It's designed for businesses acquiring "fixed assets" (such as equipment, buildings, and land) and adding new employees as a result. This program provides companies below-market financing. Virtually all types of businesses are eligible, except retail. The maximum award is $500,000. The applicant is the city. Terms are negotiated. 3) Ramsey County Business Loan Program The Ramsey County Business Loan Program provides gap financing that can be used in conjunction with other private and public funds. Who can apply? In general, loans are restricted to commercial, industrial, or service oriented businesses located in or moving to Ramsey County. In addition, businesses must be registered to do business in the State of Minnesota and demonstrate a need for public financing. How does the program work? • Loans are typically made for the purchase of capital equipment, land and building acquisition, and building rehabilitation or new construction. Application fees are March 10,2008 Mounds View Business Toolbox Internal Document Page 7 of 10 Slow, and rates and terms are more flexible than the market. Loans of up to $250,000 are provided. To request an application, or to obtain more information, you can contact Denise Beigbeder at the Ramsey County Community and Economic Development office at 651-266-8005. 4) Bonds used for Development By state law cities can issue bonds. These debt instruments can be taxable or tax-exempt. Not all bonds are general obligation. Pure revenue bonds are also common, especially for development. Bonds can be used to pay project costs and for the first two or three years of interest payments. This reduces the need for short-term revenue. There are several types of bonds the City could consider for development projects: a) Revenue Bonds. Various bonds used to finance industrial, commercial and medical facilities, multifamily rental housing, nursing homes and some nonprofit activities. b) Industrial Revenue Bonds. Allows cities to issue tax-exempt bonds to finance fixed assets. In the typical transaction, the city issues the bonds and becomes the legal owner of the asset (e.g. building). The City then leases back or sells the asset to the company. The firm's repayment coincides with bond payback. c) Essential Function Bonds. Certain types of economic development are considered by the state to be "essential functions" of a city. Sometimes called "housing revenue bonds", these bonds are not general obligation bonds backed by the full faith and credit of the City. Revenues generated by the project pay the bond and can be used for a variety of housing options (market and nonmarket rate). d) Common Bond Revenue Bonds. State and local governments may issue tax-exempt or taxable revenue bonds on behalf of private borrowers to provide lower interest rates on long-term financing. In general, manufacturing, medical facility, nonprofit or nursing home projects are eligible for tax-exempt revenue bonds and those issued for commercial projects are taxable. Bonds issued through the Common Bond Fund are investment-grade instruments with a rating based on the security provided by the fund. e) Bank Qualified Bank Direct Tax-Exempt Loans. These are cost- effective tax-exempt financing for capital projects for small manufacturing companies and nonprofit organizations. 5) Business Improvement Partnership Loan Program Purpose: The City's Economic Development Authority has a vested interest in helping Mounds View businesses thrive and prosper while improving the aesthetics of the commercial, industrial, and retail sectors of the community. Accordingly, the Mounds View Business Improvement Partnership Loan Program has been March 10,2008 Mounds View Business Toolbox Internal Document Page 8 of 10 established to partner with local businesses by providing 2% interest loans for exterior and interior building improvements. Details regarding this program are attached as Appendix B. Who can apply? Any business owner who has operated a facility or property located in Mounds View for a minimum of two years. How does the program work? The City's Economic Development Authority, in partnership with local banks, will provide improvement loans to existing Mounds View businesses at a minimum of $10,000 and a maximum of $50,000. The City participates by providing only half of the loan amount at a 2% interest rate. 6) Tax Rebate Financing (TRF) The City of Mounds View has adopted the attached policy (see Appendix C) pertaining to Tax Rebate Financing (also known as Tax Abatement). An abatement is a property tax repayment rather than an exemption from paying property taxes. It is a method to finance up-front costs and provide additional equity to a development or to finance a public improvement. For eligible redevelopment and development projects, all or a portion of City real estate taxes can be rebated for up to 15 or 20 years. Ramsey County and the Mounds View S School District can also rebate all or a portion of their share of real estate taxes. If all three taxing jurisdictions participate, taxes may be rebated up to 20 years. Purpose: The fundamental purpose of Tax Rebate Financing in Mounds View is to encourage desirable development or redevelopment that would not otherwise occur but for the assistance provided. Who can apply? Any developer or business owner with a facility or property located in Mounds View, or any developer or business owner intending to construct a facility in Mounds View. How does the program work? The developer or business owner completes a Tax Rebate Financing (TRF) application and submits the application and the required $1,000 application fee to the City's Community Development Department. Economic Development staff reviews and analyzes the information and presents it to the City's Economic Development Authority. The maximum applicants may abate is $200,000 per year or up to 10% of the City's levy. There is no minimum abatement or rebate. • March 10,2008 Mounds View Business Toolbox Internal Document Page 9 of 10 7) Tax Increment Financing (TIF) The City of Mounds View has adopted the attached policy (see Appendix D) pertaining to Tax Increment Financing (TIF). TIF is considered the premier tool for economic development in Minnesota. Since 1986 the biggest single development program in the City of Mounds View's Toolbox has been the use of Tax Increment Financing (TIF). TIF, in brief, is the ability to capture and use all increased local property tax revenues from new development within a defined geographic area. TIF payments to developers can be used for eligible uses, such as land acquisition, demolition, utilities, parking, relocation, administration, etc. There are different types of TIF districts, including redevelopment, economic development, housing, and soils condition districts. Mounds View currently has four tax increment financing districts—three redevelopment districts and one economic development district. Purpose: It is the policy of the City of Mounds View to consider the judicious use of Tax Increment Financing (TIF) for those projects which demonstrate a public benefit by constructing public improvements in support of developments that will: create new jobs, retain existing employment, eliminate blight, strengthen the economic base of the City, increase property values and tax revenues, create economic stability, and/or expansion of business and housing options in the City. S Who can apply? Any developer or business owner with a facility or property located in Mounds View, or any developer or business owner intending to construct a facility in Mounds View. How does the program work? The developer or business owner completes a Tax Increment Financing (TIF) application and submits the application and the required $5,000 application fee to the City's Community Development Department. Economic Development staff reviews and analyzes the information and presents it to the City's Economic Development Authority. The EDA gives preference to the use of "pay as you go" assistance to finance development or redevelopment projects. S March 10,2008 Mounds View Business Toolbox Internal Document Page 10 of 10 Item No. 8C Meeting Date: March 21, 2008 Type of Business: EDC City of Mounds View Staff Report To: Economic Development Commission From: Heidi Steinmetz, Economic Development Specialist Item Title/Subject: Premium Stop Redevelopment Area Update On Monday, March 3rd, I e-mailed the EDC a "newsflash" memo, which staff had provided to the City Council on February 29th. The "news" was that 11 of 12 properties located within the Premium Stop Redevelopment Area are available for sale. This news is currently being marketing on the City's Web site. At the March 10th EDA meeting, staff suggested the idea of a development moratorium for the area, however there was not EDA/Council consensus to explore the idea. • It is anticipated that MN Dept. of Employment & Economic Development (DEED) will announce its redevelopment grant awards by the end of the month. As you may recall, staff submitted a grant application to DEED in late January for $510,000 of assistance for the redevelopment of Robert's. A purchase agreement between the current owner of Robert's (the bank) and an interested buyer is currently being negotiated. Contingent upon City approvals, the property could operate as a bar in approximately two months. On a related note, staff has scheduled a redevelopment "Roundtable" discussion for the April 7th Council Work Session. The purpose is to gain market and financial feasibility insight from the development community regarding the Premium Stop Redevelopment Area and the Saturn/MultiTech site. Please let staff know if you are interested in attending. Respectfully submitted, jez„,tatt„.„4 Heidi Steinmetz Economic Development Specialist