HomeMy WebLinkAbout11-18-2016
CITY OF MOUNDS VIEW
ECONOMIC DEVELOPMENT COMMISSION
AGENDA
MOUNDS VIEW CITY HALL
FRIDAY, November 18, 2016
1. CALL TO ORDER
2. ROLL CALL
3. APPROVAL OF THE AGENDA
4. APPROVE MINUTES from July 15, 2016
5. EDC BUSINESS
A. Resignation of Commissioner Dahlstrom
6. REPORTS OF STAFF
A. Mounds View Project Updates
7. REPORTS OF COMMISSIONERS
8. NEXT REGULAR EDC MEETING – December 16, 2016
9. ADJOURN
Commissioners: Chair Jason Helgemoe, Dan Larson, Jim Freichels, Gary
Stevenson, Jessica Rieland, Laurie Shoop, and Royal
Dahlstrom
City Staff: Jim Ericson, City Administrator
Brian Beeman, Business Development Coordinator
Minutes of the Economic Development Commission
City of Mounds View
Ramsey County, Minnesota
Regular Meeting
July 15, 2016
City of Mounds View, Council Chambers
2401 County Road 10, Mounds View, MN 55112
1. CALL TO ORDER
Chair Jason Helgemoe called the meeting to order at approximately 7:30 a.m.
2. ROLL CALL
Members Present: Chair, Jason Helgemoe, Vice Chair, Jim Freichels,
Commissioners, Dan Larson, Jessica Rieland, Gary Stevenson &
Laurie Shoop
Members Absent: Royal Dahlstrom
Staff Present: Business Development Coordinator, Brian Beeman, City
Administrator, Jim Ericson
Meeting Attendees: N/A
3. APPROVAL OF JULY 15, 2016, AGENDA
Motion/Second: Commissioner Freichels moved and Commissioner Shoop seconded
the approval of the May 20, 2016 EDC agenda.
Motion Carried: 6 Ayes, 0 Nays
4. APPROVAL OF MAY 20 2016, EDC MINUTES
Motion/Second: Commissioner Shoop moved and Commissioner Freichels seconded
the approval of the May 20, 2016 EDC minutes, as presented.
Motion Carried: 6 Ayes, 0 Nays
5. EDC BUSINESS
EDA Levy
Business Development Developer, Brian Beeman provided an introduction to the EDA
Levy being considered. The City of Mounds View is located in a highly desirable location
near I-35W and is in a great school district. However, the available land for development
is limited. In order to add more tax value, better aesthetics, and ultimately the tax base, a
funding source is needed to be able to purchase parcels for redevelopment, remediate
soils, and make it more desirable for private development. Vacant properties have
become available in the past; however the City has lacked funding to purchase them. In
order to rectify this problem staff is proposing an EDA Levy to help fund these types of
EDC Minutes
July 15, 2016
Page 2 of 10
projects. MN Statutes 469.107 authorizes a city, at the request of an EDA, to levy a tax
for the benefit of the EDA. The tax must not be more than 0.01813 percent of the
estimated market value. The Statute doesn’t expressly limit the proceeds to any
particular use, but may be used for any activity an EDA is authorized to carry out under
the EDA Act for housing and redevelopment activities and broader economic
development activities.
Beeman continued by stating, the City is considering an EDA levy as one method to fund
various economic development activities. The levy would provide the resources
necessary to purchase the properties, demo the buildings, and repackage them for
development activities. New development will assist in increasing the tax base, evening
out the overall tax levy, and in some instances bringing in new jobs, and aiding in the
attraction, retention, rehabilitation, and preservation of commercial properties, retail,
residential, recreational, and public service centers.
Other types of goals for an EDA levy is the support of senior housing, multifamily use,
utility telecommunication projects, business incubator, loans, other business programs,
and transportation systems. The emphasis on the EDA levy would be to replace older
buildings and increase the tax base. This would assist in eliminating blight, and in
meeting the economic and redevelopment goals. Other goals would be in assisting with
operational costs associated with economic development activities.
The City of Mounds View granted authority to the EDA through Minnesota Statutes,
Section 469.09, subdivision 1, giving specific authority to exercise all powers granted to
a Housing and Redevelopment Authority under Minnesota Statutes, Sections 469.001 to
469.047. This power was granted to the EDA on November 23, 2015 through Resolution
8467; a resolution amending and restating resolution 4532, an enabling resolution
establishing the Mounds View Economic Development Authority under Minnesota
Statutes, Sections 469.090 through 469.108.
Beeman informed the Commission that due to lack of funding, staff developed a list of
activities restricted or not supported. The first on the list is marketing. Currently, there
are no funds budgeted for marketing. Marketing is used for new signage, branding,
promoting the new redevelopment sites and marketing to businesses in other cities.
Some cities participate with the Department of Employment and Economic Development
(DEED) in trade shows to attract national and global companies. There is also the
Shovel Ready program whereby a city can certify their parcels with the Shovel Ready
designation for companies looking to move in right away to start development on parcels
with utilities, environmental remediation, and other features already completed and
ready for construction.
Second is advertising. Currently, there are no funds budgeted for advertising.
Advertising can be used for business journals in certain industries to target business
leaders, Mounds View Matters, and other advertising venues. The city advertises
Festival in the Park and other types of activities that go on throughout the year.
Under small scale incentives, the EDA has a program called, the Business Improvement
Program. Staff has received requests for this loan program in the past; however the
program is currently unfunded and has been for several years. While we have the
EDC Minutes
July 15, 2016
Page 3 of 10
policies in place for this program it is not funded. The program is meant for small
businesses that have been established in Mounds View for a number of years looking to
improve the façade of their buildings in order to improve the aesthetics. There are other
revolving loan programs that could be put into place, however without proper funding,
these programs are not possible.
Beeman informed the Commission that property acquisitions is one of the bigger
unfunded programs. Staff keeps an inventory of vacant properties along with the square
footage, current pricing, whether or not the owner has shown any interest in the past in
selling and a list of developers specifying if they are residential or commercial
developers and if they have shown any particular interest in specific parcels in the past
including their timeline, and number of acres they are looking for, then we try to match
them up. We try to identify the types of funding sources that may help them spur
development. Because the City is limited in funding sources and has been reluctant to
bond in the past, not to mention the Charter restrictions, etc. an EDA levy would help
solve this problem.
The next unfunded item is surveys. Sometimes it is necessary to complete surveys of
the property before development can occur, this comes with an expense an EDA levy
could help pay for this.
Appraisals are also sometimes requested and necessary to negotiate a fair market
value. Depending on the appraisal, some could be good for six months to a year. Again,
an EDA levy could assist in this cost.
EDA levy funds can also be used for professional fees. Whenever a transaction is taking
place attorneys must be involved to draft legal documents and ensure the City is
protected in development agreements and land transfers. Financial consultants analyze
the project to determine its feasibility and if the subsidy is deemed appropriate according
to State Statutes and helps keep the City out of legal challenges.
An EDA levy can also be used for training and professional development which is
needed to keep staff current on state statutes and economic development programs.
Having well trained staff is good for business. It is a way for staff to keep current on
State DEED programs and be able to explain those programs to developers. Good
training also helps staff in preventing any missteps which could lead to costly lawsuits.
Next, Beeman explained the chart listing all entities currently using EDA levies. Beeman
explained that staff had surveyed the organizations listed on the chart and what those
cities were using their levies for and if it has been effective. For example, the City of
Columbus is using their EDA levy for advertising/branding, marketing, attracting new
development and businesses and retaining current businesses, as well as the Shovel
Ready program, and their website.
Beeman found that the City of Dayton uses their levy for small incentives, a business
summit, and other marketing to encourage new business. The City of Hutchinson mainly
uses their levy for operations like paying & training staff. The City of North Branch uses
their levy for multi-use housing and industrial development. Brooklyn Park used their
EDA levy for the Open to Business program. Beeman has talked to other cities who
EDC Minutes
July 15, 2016
Page 4 of 10
have offered high remarks of this program. Beeman thought Mounds View could also
look into this program in the future. Other uses from Brooklyn Park are for DEED’s site
selector program, vision for the light rail transit renderings, print advertising and
merchandizing, a banker’s breakfast, business forward forum, branding, and
newsletters. The City of Prior Lake used their EDA levy for a small business incubator
program, and a SAC & WAC deferred loan program, which is the sewer and water
access charge. Beeman suggested that Mounds View may also want to look into starting
this type of program.
The City of Watertown has a program similar to Mounds View’s building façade program.
Watertown also uses their levy for a revolving loan fund in addition to a downtown free
WIFI program and property acquisition for redevelopment activities such as, demolition,
environmental, etc. as well as staff support and marketing. Beeman stated that revolving
loan programs are nice because once the money is paid back it can be used to fund
another business.
Beeman asked the EDC to review and discuss the EDA levy asking their opinion if they
believe the EDA levy is a good or bad idea etc. Beeman will take the EDA’s comments
and recommendation to a City Council Work Session on August 1. Any EDC Member is
welcome to attend the Work Session and it is open to the public as well.
Chair Helgemoe asked the Commission if they had any comments. Commissioner Gary
Stevenson asked if the .01813 percent calculation set by State Statute is used by all of
the cities listed on the chart. Beeman responded that the percent is the maximum
allowed under the statutes, but not all cities have chosen to use the maximum amount.
That decision is at the discretion of the City Council. Stevenson asked if there was a
chart that showed the amount each city was using. Beeman said it was not listed in the
spreadsheet but that he could poll the cities or find a different way to get those amounts.
Commissioner Freichels asked what amount the city is looking to acquire. Beeman said
that from what he was told based on the current property valuations a maximum EDA
levy could potentially generate around $161,000 annually.
Helgemoe asked if the .01813 percent was calculated at .0001813 times the valuation.
So, based on a home valued at around $200,000 it would be around $30. Beeman
thought this sounded right but said he would check that calculation with the City’s
Finance Director. Helgemoe asked if staff knew the current valuation of the city’s
properties. Beeman didn’t know the exact number and explained that the valuation
fluctuates depending on how the property is classified as residential and commercial,
and also any TIF districts, and other exemptions. Beeman will check with the Finance
Department to see if they have the current valuations and calculations. Helgemoe stated
that he presumes that most residents will want to know the actual dollar amount their
taxes will be raised instead of the percentage.
Helgemoe said the idea of an EDA levy is commendable in terms of the use; it appears
to be a good use to help support businesses in the area. Theoretically, if the funds are
used to attract new businesses, retain current businesses, then used to acquire
properties that would be more valuable in the future, the city could acquire its tax base
EDC Minutes
July 15, 2016
Page 5 of 10
and then theoretically get its money back, but it is also extra money out of people’s
pockets.
Helgemoe asked if the Commissioners had comments in terms of the uses. Is it
something we want to do or not? Personally working with business, these are things that
are important to businesses in terms of projects to attract and retain business, new
development deals, etc. If the city doesn’t have the money to do it then we can’t get it
done.
Commissioner Freichels agreed that it is a good use of funds to acquire property to get
updated in the City of Mounds View especially with the Rice Creek Commons
development coming on-line. The City will be competing against a blank slate and
Mounds View is an older city so there a several buildings that need some attention,
especially if considering a new development across the freeway. I believe the city is
going to have to do something because there is a lot of land over there for
redevelopment. Mounds View has a good story in the sense that they have a history of
well-established business which may not be competing against high property tax values
in land with this year’s building verses buildings built 10-20 years ago. Particularly if the
city has specific sites they have in mind for redevelopment.
Currently, the city doesn’t have the funds to negotiate. This takes a lot of time and
money. I would like to see how Crossroad Pointe turns out since the city hasn’t done one
of these projects for a while. If the project turns out successful, then this is a great
example of funds being put to good use. I believe it is a good idea, whether the city goes
to the maximum or not. I know how that would affect my business in town but I would
support the levy just because I know the problems we’ve had over the years dealing with
certain properties and situations where we couldn’t do anything because we didn’t have
the money. It will be interesting to see how the Crossroad Pointe project turns out. Even
though it would increase the taxes collected on my business property, I would be in
support of it.
Commissioner Rieland, said she believes the key would be to know how much it would
affect tax payers. She supports the levy because in order to have a vibrant city we will
need funds in order to prevent further pockets of decay in the city as it gets older. Also
with the recent Rice Creek development, there is increased competition. This is a great
opportunity especially with the new Bel-Rae and Crossroad Pointe development and the
Rice Creek Commons development. This is a great time to put this on the table to at
least see how people react.
Commissioner Dan Larson and Laurie Shoop agreed. Larson mentioned that as a
resident he is seeing the housing stock deteriorate and we can either let it go or take
steps to improve the situation. Therefore, I am for it.
Commissioner Freichels said that the city is limited on the funds that are available and
with more blight this type of funding could help alleviate this problem. Perhaps more
enforcement could also be part of the solutions depending on how the funds could be
used.
EDC Minutes
July 15, 2016
Page 6 of 10
Larson said there have been certain houses that have been built as a replacement of
some of the blighted homes and this will bring in higher tax revenue than those homes
that were just sitting there in a blighted condition. Therefore, there is positive payback in
updating and/or replacing such homes.
Commissioner Stevenson said it may be much easier in Mounds View to sell it because
the city is nearly fully developed rather than a city that has a lot of developable land.
However, in a city like Mounds View he believes it would be a fairly easy sell to the
public and he believes the city needs those funds.
Chair Helgemoe stated that in terms of uses, there are many good uses such as
retaining businesses, conducting studies, and to support a currently unfunded loan
program. If the program is unfunded then why do we have it? I believe that if generating
around $168,000 it would leave a lot of money for loan programs, but if we can use
some of these funds for our loan programs for improvements then it would be beneficial
if it can improve properties in the city.
Helgemoe asked if the Commissioners had any other comments or recommendations
regarding the EDA levy. Hearing no further comments, Helgemoe said it appears that
the Commission is in favor of the levy and we believe it is a positive use of funds. So to
summarize, the Commission agrees number one, that the EDA levy is a positive. Two,
since we are all in agreement should we recommend an amount or would we leave that
up to the Council. Beeman responded, saying that it would be the Council’s decision. For
the EDC’s purposes we need the Commission to decide what they think about the EDA
levy. Is the levy a good idea, a bad idea, etc.
Helgemoe stated that in that case, the Commission is in agreement that this is a positive
for the city and we are recommending that this move forward to the Council for further
consideration.
Motion/Second: Commissioner Freichels moved and Commissioner Shoop seconded
the motion recommending the EDC’s support of an EDA levy to assist in the funding of
business and housing goals & purposes to the City Council for further consideration.
Motion Carried: 6 Ayes, 0 Nays
6. REPORTS OF STAFF
Crossroad Point Redevelopment Project
Business Development Coordinator, Brian Beeman provided the Commission with an
update on the Crossroad Pointe redevelopment site. Beeman stated that he had talked
to The Beard Group and they are moving away from the idea of a Housing TIF and
exploring Tax Credits as a way to fund their project. Since the developers have never
used Tax Credits, they are working with their consultants to better understand the
process and the anticipated gap in financing before approaching the City with their
plans. The use of Tax Credits requires a 20% affordability aspect of the overall project
which increases the project costs. This means that out of the 205 units being proposed,
approximately 41 units would need to be affordable.
EDC Minutes
July 15, 2016
Page 7 of 10
The developers are working with their architects and would prefer not to approach the
City until they have a more finalized plan. The developers are also monitoring the
available funds of the Tax Credits which have been drying up do to the popularity of the
program. The developers have indicated that they are still on track to break gro und this
fall; however staff believes that a spring ground breaking is more realistic.
Commissioner Helgemoe suggested that since the Tax Credit program funds are drying
up and there is a gap, perhaps this means the project won’t be moving forward. Beeman
said the developers don’t seem swayed by the gap in financing and they appear
confident that the project will move forward. Commissioner Freichels asked if there was
a reason they weren’t asking for the Housing TIF. Beeman said that even with a Housing
TIF and a land write-down there may still be a gap in financing and the Housing TIF also
requires a 20% affordability aspect. Originally they wanted to do an all market rate
project. Freichels asked if they used a Housing TIF in Osseo. Beeman said, as he
understands it, they did use a Housing TIF in Osseo that triggered the affordability of
certain units. Helgemoe asked if the Commissioners had any more questions. Hearing
none, Beeman moved to the next item on the agenda.
Business Retention & Expansion Visit (BR&E) Updates
Coordinator Beeman informed the Commission that a business owner is planning on
moving into the former Snap Market space as soon as he returns from his vacation and
has plans for an off-sale liquor operation.
BioClean is still looking for a location for its truck franchising operation. They would keep
the existing building as its main office and would like the second building to be located
within a five mile radius of Mounds View. Helgemoe asked if Beeman knows the price
that the Skyline Motel has come down to in the negotiations. Beeman indicated that he
can’t release that information as it is part of the negotiation process. Beeman said the
property is not formally listed, the owners are taking offers and don’t seem t o be
motivated to sell. The price that the owners came down to was still so high that it wasn’t
feasible to even consider a TIF as it was felt that the City shouldn’t be rewarding a
business owner for not negotiating.
Beeman stated, we are using tax payer’s money so we need to be cognizant of how we
are using those funds. The owner of BioClean was working with a contractor to negotiate
with the owners of the Skyline Motel and since the Skyline Motel owners weren’t willing
to negotiate a reasonable price, the deal fell through. The BioClean owner wants to build
his building in or around Mounds View. Beeman said that Mounds View is strategically
located along I-35 and this makes the land valuable. The land will continue to be
valuable as improvements are made with the addition of the MNPASS lane, Rice Creek
Commons development, and the limited land availability in Mounds View.
Mounds View Square still has six vacancies and has shown interest in locating a tap
room business once the City has passed the proper ordinances. The Tap Room
Ordinance is expected to be passed in August. Beeman stated that he has received
about three different inquiries on tap rooms so far and he has provided them the square
footage and available location information.
EDC Minutes
July 15, 2016
Page 8 of 10
Empire House has approached the City looking at constructing a building on the vacant
land north of Biolife. For some reason, they were negotiating with a company that didn’t
own the land. Once they found out, they decided to back out of the project. Beeman
identified a person that sits on the real estate board for Biolife and ensured that the two
were in contact going forward. To date, Beeman hasn’t heard from the Empire House
owner other than the owner saying he would follow up with the contact. The owner also
had mentioned in past conversations with Beeman that he liked Mounds View and how
its staff has worked with them and desired to stay in the City if possible even though they
have looked at Blaine and surrounding sites.
Beeman informed the Commission that it would be much easier if the City owned more
land and could assemble those parcels for redevelopment. There is a high demand for
industrial use and with the City owning little land, staff is forced to contact the private
land owners and get them in contact with business owners. This complicates and
prolongs the process making it more difficult. Helgemoe thought it was interesting that
they were negotiating with someone that didn’t own the land. Beeman said there have
been similar cases even on the residential side out of Chicago and other places where
an unknowing buyer will sign a purchase agreement with someone that doesn’t own the
property. This buyer transfers the money then never sees the person again. The buyer is
then out both the house and the money.
Next, Beeman informed the Commission that El Loro has indicated that they will be
closing in about two months. They mentioned a construction project a few years ago
along I-35 that closed a street for a time. The customers got used to taking the alternate
route and they were never able to regain the customer base like they had before. They
also mentioned that they tried negotiating their lease but were unsuccessful.
Commissioner Rieland asked how long they have been in business. Helgemoe said they
have several locations around the Twin Cities. Beeman thought they had been in the
Mounds View location for about five or so years. Beeman said there isn’t much that can
be done to assist them. They would need to decrease their lease amount and/or
increase their customer base.
The owners liked the idea of the Crossroad Pointe apartments which in theory would add
more customers. However, they said they are not able to hold on for another year until
the new apartments are built. Helgemoe asked if Pastor Enterprises, who owns the
building, had mentioned any plans for that location. Beeman said he has been
approached by a restaurant who may be interested in the building; however the owner
has asked that staff keep the inquiry confidential at this time. Since the building has a
commercial kitchen it has a higher demand than other buildings.
Beeman informed the Commission that a private event center group was looking at the
Tires N More area as a possible location to hold weddings, caterings, and other
gatherings. On the weekends there could be around 200 vehicles. The group was
intrigued by the property since the EDA owns an adjacent parcel. However, the parking
ratios may have been a challenge and the city’s desire for that area is to redevelop all
three parcels as one project rather than piecemeal parcels to force a project. As a result,
the group has decided to continue its search in other locations.
EDC Minutes
July 15, 2016
Page 9 of 10
Rice Creek Commons (TCAAP) Development Update
Beeman updated the Commission on Rice Creek Commons stating that the
infrastructure construction is currently underway and substantial completion is expected
to be this fall with final completion in the Spring of 2017. Phase I of the building
construction will begin in 2017 and is expected to consist of 200 homes, and anchor
business, and the recruitment of a grocery store. Alatus is the master developer.
Helgemoe asked when the new bridge over County Road H will be completed. City
Administrator Jim Erickson said it is expected to be completed by November this year.
Commissioner Larson asked how the businesses are holding up with the construction.
Beeman said he has received about three calls from businesses complaining originally
about wanting more signage to direct people to their business during construction and as
the construction prolongs into the summer it starts to affect the businesses and there
revenue. One has even threatened a law suit even though it is a State and County
project. The City also changed the addressing along the stretch of Lucky’s, R.J.’s, and
the Auto Repair shop from Hwy Ave to County Road H. This seems to make more
sense. In addition, the City Council has approved the County Road 10 renaming to
Mounds View Boulevard which goes into effect in August. Beeman has been in contact
with the company that worked with Biolife on sequencing their address so clients can
find them and left several message, however they have yet to get back to him.
Snyder Building
Beeman is still working on the Snyder building to get it sold or leased; however the
owner still has not come down on price. An auto parts store was interested in the early
spring but nothing came of it. Beeman had received a call from a hardware store that
may want to look at it. Multiple restaurants have also asked about it but the parking
ratios and price have kept them from committing to anything. Bike stores have also
shown interest in the location but again, it really comes down to price.
Mounds View Business Council
Beeman informed the commission that the next Mounds View Business Council meeting
will be held at the Mermaid Event Center September 14 at 7:30 a.m. until 9:00 a.m.
Since the Arden Hills and Shoreview Business Councils have had little interest, it was
thought that combining them with the Mounds View Business Council would generation
more attendees. For the first meeting, we wanted a topic that all of the cities could relate
to. Therefore, the speaker will be a representative from Atalus, the Master Developer for
the Rice Creek Commons development. For now we are calling it the North Metro
Business Council until a better name is determined. After the featured speaker, the cities
will talk about how they would like to proceed in future meetings and talk about the
naming of the group. Helgemoe said it will be a good speaker and encouraged the
Commissioners to attend.
EDC Minutes
July 15, 2016
Page 10 of 10
Other Upcoming Events/Reports
Beeman reminded the Commissioners that the last Music and Movies in the Park will be
held at Silver View Park August 18 starting at 7:00 p.m. The Movie will start after 8:00
p.m. once it gets dark.
National Night Out is August 2, 2016. Beeman encouraged the Commissioners and
residents to attend and if they have ideas on an event they should call Police Officer
Nate Garland at the Police Department.
Filing for elections opens August 2, 2016 at 8:00 a.m. and applications will stop being
accepted August 16 at 5:00 p.m.
Commissioner Stevenson mentioned that the Festival in the Park is August 20. Beeman
said the bike registration is $25 if registering by August18 and $35 at the day of the
event. Commissioner Helgemoe said New Brighton is also having a bike race and these
types of events draw a large crowd. A local bike racer has been very successful in
competing internationally and he is helping to organize the event.
7. REPORTS OF COMMISSIONERS
Chair Helgemoe asked for reports from Commissioners. The Commissioners had no
reports.
8. NEXT REGULAR EDC MEETING
Chair Helgemoe thanked Beeman for his detailed reports and thanked everyone for
attending, then reminded everyone that the next EDC meeting will be held August 19 at
7:30 a.m. if needed. Beeman and Helgemoe will stay in contact as it gets closer to that
time to determine if a meeting will be held.
9. ADJOURN
There being no further business, Chair Helgemoe adjourned the July 15, 2016, meeting
at 8:31 a.m.
Respectfully submitted,
_______________________________
Brian Beeman
Business Development Coordinator
Item #: 5A
Meeting Date: November 18, 2016
Type of Business: EDC
City of Mounds View Staff Report
To: Economic Development Commission
From: Brian Beeman, Business Development Coordinator
Item Title/Subject: Resignation of Commissioner Dahlstrom
A. Resignation of Commissioner Dahlstrom
The Chair of the EDC will announce Commissioner Dahlstrom’s resignation.
On November 8, 2016 EDC Commissioner Royal Dahlstrom sent Business
Development Coordinator Brian Beeman his resignation letter. Commissioner
Dahlstrom cited that he is sorry to have to give up his seat, but the meeting time
conflicts with his new job. He thanks the EDC and staff for their hard work to move
Mounds View forward.
No resolution or motion is needed by the EDC. Commissioner Dahlstrom’s vacancy will
be posted with the other EDC vacancies with one of the seats to fill the remainder of
Dahlstrom’s term which ends December 31, 2017.
Respectfully Submitted,
______________________________
Brian Beeman
Business Development Coordinator
Item #: 6A
Meeting Date: November 18, 2016
Type of Business: EDC
City of Mounds View Staff Report
To: Economic Development Commission
From: Brian Beeman, Business Development Coordinator
Item Title/Subject: Reports of Staff
A. Crossroad Pointe Redevelopment Project
On January 25, 2016 the EDA approved the predevelopment agreement between The
Beard Group and the City of Mounds View. The purpose of the predevelopment
agreement is to allow for a period of time to complete the due diligence on the site. On
October 12 The Beard Group notified the City that they will be pulling out of the project.
Below are their comments:
Brian,
I’m glad to hear that you are getting interest on the site. At this time I think The
Beard Group is going to have to move on from the Crossroad Pointe project. We
do not see a feasible way forward with financing. There is no way for us to do a
market rate apartment and there are a number of complications in trying to do
an affordable deal, time being a major one. We tried numerous avenues to make
it work but unfortunately none of them work with what we want to do and with
what the city wants.
We are still interested in pursuing development opportunities in Mounds View
and would look forward to working again with the city on a future development.
It has been great to work with you and the city of Mounds View. I’m sorry that
we weren’t able to put something together.
Best Regards,
Ben Beard
The Beard Group’s intentions have been to build all market rate apartments, however
the Tax Credit program requires them to have at least 20% of the project affordable.
This requirement made the project more expensive and they were not able to find a
solution to meet their financing options. As a result, staff will refocus their efforts in
attracting a new developer to the site. With the Rice Creek Commons development,
land prices are expected to increase in the area. On the contrast, the City’s project is
now a year behind and has increased competition.
Reports of Staff
November 18, 2016
Page 2 of 6
B. Business Retention & Expansion (BR&E) Visits
Nearly all businesses in Mounds View have been visited. The few remaining businesses
have not returned phone calls or emails. Some have said they wish not to participate.
The Business Development Coordinator will continue to schedule more visits as
needed. On October 18 Coordinator Beeman attend the Political Leadership luncheon
as a finalist in the Business Retention & Expansion category of the St. Paul Chamber of
Commerce. The City of Mounds View received a trophy for the second year in a row for
its Business Retention & Expansion efforts.
Snap Market: Mr. Ankur Chopra of Keshav Enterprises, Inc. had a liquor license
approved May 23, 2016 and had intentions of opening an off sale liquor store at the
Snap Market location. Recently, staff has learned that Mr. Chopra has notified the
landlord that he will not be pursuing a liquor store at this location. Therefore, this space
is available.
Bio Clean: They are still looking to build a new building to assemble their franchise
trucks equipped with power washers. They tried negotiating a deal with the Skyline
Motel and the owners of the Motel wouldn’t negotiate enough on the price to make the
deal work. As a result, they are still looking for land to build a new facility or an existing
building to refurbish. They would like to stay within 5 miles of their existing site if
possible.
Mounds View Square: They still have six vacancies and seven if counting El Loro. They
have talked about a possible tap room . Coordinator Beeman has contacted the leasing
broker who is aware that the City recently passed the tap room ordinance. The broker
will contact the City when he finds a potential client.
El Loro: A sign is posted on the front doors indicating they have closed and moved to
the existing Circle Pines location. They will not start a new business but rather, they will
move the Mounds View employees to other El Loro locations around the metro. In
talking with the Manager, he said they have experienced a decline in customers and
they can’t recover. They attempted to negotiate new lease terms with Pastor
Enterprises but they were unsuccessful. They were encouraged by The Beard Group’s
proposed apartment development at Crossroad Pointe, but they indicated that it was a
year too late and they couldn’t hold on for another year. They have removed the stove
and other kitchen appliances and a new fire alarm was installed. They didn’t mention
who was inquiring, but said there has been some interest from other businesses and
that it is too soon to tell and there have been no commitments.
Reports of Staff
November 18, 2016
Page 3 of 6
Tom’s Collectibles: Coordinator Beeman recently talked with Tom Frantzen, owner of
Tom’s Collectibles. Tom has decided to stop doing business in the hobbyist industry
and instead, has leased space in Roseville as a business consultant. Tom thanked the
City for working with him and helping his business in the past years and said it is time to
move on. Inventory in the current location in Mounds View is being liquidated and they
expect to be out of that location in about two months. A chiropractor has shown some
interest in the space but nothing has been finalized.
Empire House: Empire House had intentions to build a new building in Mounds View
and decided to stop any and all negotiations on the land north of Bio Life because the
land owner has many shell companies and their attorneys were busy trying to determine
who actually owned the property. Once it was determined who owned the property, the
land owners decided that they wanted to sit on the land in case Bio Life needed it for
future parking. Coordinator Beeman connected the Owner of Empire House to a
decision maker on the Baxter Board of Real Estate. They indicated that they would be in
touch. To date, Empire House has not notified the City of any immediate plans to build
on the property and they are actively looking for other locations.
Mermaid Event Center: Business Coordinator Brian Beeman talked to the owner of the
Mermaid a few months ago about the idea of putting in a coffee shop or similar business
on the corner of County Rd H & 10. This was initially an effort to find Dunkin Donuts
another option since they were not allowed to move into the Edge wood Plaza space.
Since that time, the owner has indicated that he is in discussions with one or more
businesses that may be interested in the corner site. Staff will be meeting with the
owner on October 13 to discuss his ideas for that area.
Western Bank: EDC Commissioner Gary Stevenson and Business Development
Coordinator Brian Beeman visited Western Bank on November 9, 2016. The bank is
owned by a parent company out of Omaha, Nebraska. They have 6 FT and 3 PT
employees. Their business has been stable but expects a slight increase in the coming
years. They praise the Police for their great response time and the new trails the City
installed this summer as well as the Mounds View Boulevard street name change. They
would like the City to participate in things like Rotary and more Chamber events. They
seem to think that the water and waste water rates for businesses is too high and
believe that transportation for the western side of the City should be considered, like an
arterial bus route. Mounds View’s geographic location and school district are positives.
C. Rice Creek Commons (TCAAP) Development Update
Construction on Rice Creek Commons and Mounds View Boulevard & County Road H
is nearing completion and is expected to be open in December with final completion in
early 2017. The building construction, development process, and County Road H & I
roundabouts are on schedule for construction to begin in 2017.
Reports of Staff
November 18, 2016
Page 4 of 6
Alatus has been chosen as the master developer who has indicated that Phase I
construction will consist of 200 homes. In addition, Alatus will begin its search for a
business anchor with the idea that it will spur more commercial development interest. In
talking with the Mounds View School Superintendent, he has indicated that they are in
the preliminary stages of determining how to handle the influx of new residents
translating into more students. As I understand it, a freeze on open enrollment is in
force.
D. Mounds View Project Updates
Website: On September 5, the City Council authorized setting up a Website Task Force.
The first Task Force meeting was held September 28. The Task Force is actively
hearing presentations from each of the preselected companies , in addition to
researching and evaluating the companies. The Task Force is expected to discuss its
final recommendation to hire one of the website companies at the December 5 Council
Workshop with the expectation that the Council will approve by Reso lution the
recommended company at its December 12 meeting. The initial kick-off meeting and
design phase could start as early as January 2017 and would take approximately 5-6
months for the design phase and about a year to launch the final website.
Silver Lake Park Trail: Other than some landscaping and a small segment of concrete,
the Silver Lake Park Trail has been completed.
Trail Segments: For the most part, the other trail segments in the city have been
completed. A few utility light poles and some grass seeding still need to be completed.
Community Center Sign: A new Community Center monument sign has been
constructed with a similar look to the existing City Hall sign and placed closer to the
street. The old sign which was showing signs of wear, was largely hidden from the
roadway, and was using the old city branding. That sign has been removed.
E. Snyder Building
Staff is in regular contact with the broker offering ideas and leads. The main issue is the
price and lack of parking. The asking price has been reduced from $2.5 mill to
somewhere between $1 to $2 mill. The lease is over $14 p/sq. ft. Many businesses like
the location but can’t afford the price and/or require more parking spaces. The owner
has been forced into paying the loan payments without income from the building and
has indicated that he is accepting reasonable offers and is open to creative financing.
F. County Road 10 Addressing (Mounds View Boulevard)
On June 13, 2016 the Mounds View City Council passed Ordinance 918 renaming
County Road 10 to Mounds View Boulevard. The name change went into effect the end
of July. The Post Office will continue to deliver mail to the old addresses as well as the
new address. Google Maps has already made the change and others such as Tom -Tom
Reports of Staff
November 18, 2016
Page 5 of 6
& Garmin are working with their third party GIS mapping companies to also make the
change. Businesses are encouraged to change their address to Mounds View
Boulevard as soon as they are able.
G. North Metro Business Council Meeting
The last North Metro Business Council meeting was held September 14 at the Mermaid
Event Center. The speaker was Bob Lux from Alatus who is the Master Developer for
the Rice Creek Commons project. The City of Arden Hills and Shoreview has joined the
Mounds View Business Council and the group is now calling themselves th e North
Metro Business Council. The next meeting will be held December14 at the Mermaid.
The meeting will start at 7:30 a.m. with community updates, followed by a speaker from
the Met Council starting at 8:00 a.m.
H. Manufacturing Week
The week of October 2-8 was Minnesota Manufacturing Week. Manufacturing Week is
an annual event where manufacturing companies around the state open up their
facilities to high school students and community leaders to explore manufacturing
careers and learn more about the companies in their local areas. This year Quanex in
Mounds View opened their facility to community leaders to learn more about their
operations. Quanex is a manufacturing company in Mounds View that constructs
window frames for companies like Anderson Windows and Bayport. They make custom
pocket doors and receive special requests as well as standard window and door sizes
then make those products to specs using a series of Computer Numeric Controlled
(CNC) machines which can be programed to cut to any size, shape, and dimension.
One in eight jobs in Minnesota is in manufacturing – and these tend to be high-quality
jobs that pay well. The average manufacturing job paid $63,251 in 2015. That’s almost
$9,300 – or 15 percent – higher than the typical job in Minnesota. Manufacturing
contributed $48.2 billion to the state’s economy in 2015. Minnesota has 317,200 jobs in
manufacturing. But when you add in jobs in other industries that are dependent on
manufacturing, that impact rises to 914,000 jobs.
I. Other Upcoming Events/Reports
As a reminder to current Commissioners and residents, applications to become an
Economic Development Commissioner for the term January 1, 2017-December 31,
2019 are due to the City offices by December 2, 2016 at 4:30 p.m. The terms of Dan
Larson and Laurie Shoop, both Resident Representatives expire December 31, 2016.
There is also one Resident Representative opening for Royal Dahlstrom’s positon, who
recently resigned from the Commission due to work conflicts. Dahlstrom’s opening will
be for a resident who can serve from now until December 31, 2017. All three openings
require that the applicant be a current resident of Mounds View and remain so for the
duration of the term.
Reports of Staff
November 18, 2016
Page 6 of 6
J. Reports of Commissioners (Agenda Item 7)
K. Upcoming EDC Meetings (Agenda Item 8)
December 16, 2016 at 7:30 a.m. The December meeting will consist of the approval of
2017 meeting dates, a recommendation of the EDC applications to the EDA for
approval, and a staff update. Please plan to be at the December 16, January 20, and
February 17 EDC meetings so that we can take action and conduct official business on
a number of required administrative functions.
______________________________
Brian Beeman
Business Development Coordinator