2026.01.05 CC Packet - Laserfiche WebLink

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Memorandum To: Bryan Bear, City Administrator From: Rachel Juba, Community Development Director Date: December 31, 2025, for the City Council meeting of January Re: Discussion on 165th Street AUAR Study 1. Background At is April 21, 2025, meeting staff presented constraints to development in the 165th Street area regarding road improvements, utility extension, land use, and natural resources. Staff put together a scope of work for an AUAR that would analyze multiple development scenarios including land use, infrastructure, environmental assessments, and costs. An AUAR can satisfy State regulations for environmental review of certain types of development and extension of sewer systems. Completing an AUAR allows future development in this area to be “pre-approved” from an environmental review by the State, so development in the area does not have to go through this process with each development application. The City Council authorized staff to move forward with the AUAR. Staff have been working on creating the land use development scenarios and getting background on the infrastructure, environmental assessment, and costs. An open house was held on July 30, 2025, with the property owners in the area to provide information on the AUAR process and get feedback on the development scenarios. Over the past months, staff met with property owners that requested individual meeting to discuss the AUAR and their goals for their property and the area. Staff refined the development scenarios with the feedback provided. On September 16, 2025, there was a joint workshop held with the City Council, Planning Commission, and EDA to discuss the open house and review land use, streets, and utilities. At the workshop staff presented feedback from the open house. There was discussion on not removing all of the industrial and commercial land uses and that interim improvements to 165th Street may be needed to accommodate development. With the feedback, staff have been developing the AUAR and refined the development scenarios and a good start the to the draft is in place. The next step in State process for the AUAR is for the City to formally order the preparation of the AUAR by resolution. A copy of the resolution is enclosed. 2. AUAR Study Area The AUAR study area encompasses approximately 785 acres located in the northwest portion of Hugo, Washington County, Minnesota (Figure 1). The 165th Street Corridor Study Area includes a portion of the Everton Avenue Neighborhood AUAR area. In future AUAR I.1