HomeMy WebLinkAbout2011-08-09 PACKET 05.City of
gottage Grove
Minnesota
To: Council /Planning /EDA
From: Ryan R. Schroeder, City Administrator
Date: July 26, 2011
Subject: Work Plan Priority Setting
Enclosed within packet materials is a draft work plan for EDA discussion at their next
meeting(s). That work plan is structured to be responsive to the Council Vision and goal
related to commercial and industrial (C /1) development. While the EDA role is not intended to
stray too far afield from C/I responsibilities it is understood that Community Development and
community building needs to be an integrated system and process. Hence, it is relevant for
the EDA to at least monitor activity /progress in housing, transportation, public facilities and
other Council goal areas. At times, for instance with mixed use projects, it is appropriate for
the EDA to take a lead role.
It would be helpful to the EDA to have some discussion regarding effort targeting. Certainly,
the top priority for the EDA would be in business attraction and retention for those businesses
with the greatest taxable market values and job and wage metrics (i.e. Business Park).
Beyond that we would anticipate the next most important role of the EDA would be to
redevelop or reposition notable opportunity areas (Home Depot, CottageView, perhaps
followed by Norris (Marketplace). It would be important to know if Council and others agree
that these two areas (business park and redevelopment opportunities) would appropriately be
considered the highest priority areas on which the EDA should focus.
If there is agreement on the above it seems a given that retail attraction would be the next
strategic focus of the EDA. However, given that we are in an atypical economy, and given that
rooftop development is required to build our retail footprint and given the above redevelopment
needs it would seem that the development leaders of the community (Council, Planning, EDA)
might wish to consider an increased focus on market housing development for a period of time.
Maintenance and construction of public facilities (buildings) would not typically be noted as a
high priority of the EDA (subject to Council direction to the contrary). Establishment of Work
Force Housing (moderate - income) would also not typically be considered among the highest
priorities of the EDA except in economies within which access to labor has become a difficulty.
That does not currently seem to be the case.
Staff is looking for feedback from the group regarding the above to assist us in completion of
the work plan.
Upon receipt of direction regarding the above there are a couple specific discussion topics that
seem appropriate. These are:
1. Community Center/YMCA vs. Home Depot Development
The City Council formed a Community Center Task Force in 2009. The task force was
charged with conducting a needs analysis and ultimately a citizens survey was
conducted which supported City participation in a joint venture with the YMCA. Over
the past few months we have been in discussions with the Y toward development of an
approximate 52,767 square foot facility on approximately 6 acres adjacent to the PSCH
project. This compares to the task force recommendation of a building size range of
59,236 - 71,154 square feet. The task force had projected Gym space at twice the Y
proposal and allocated up to 6,000 SF for track space which does not appear within the
Y space planning document. Otherwise the spaces are similar.
The City is estimating development costs for the Y project at $13.7 million with a
projected City investment suggested in the $6 million range. The City would own the
building and the Y would be a 30 year tenant with the opportunity for lease extensions
beyond the initial term. Any investments from the City would become a general
obligation of the City in some fashion through issuance of a debt instrument.
Concurrent with recent discussions with the Y the City staff has been embedded in
negotiations with a private developer toward redevelopment of the Home Depot.
Current space planning for that redevelopment includes an approximate 45,000 square
foot privately owned and managed fitness facility. Such a facility would be anticipated
as geared primarily but not exclusively toward the adult community. The City is being
asked to invest in the redevelopment of the Home Depot property (not the fitness facility
specifically). An investment to reposition the 10 acre Home Depot parcel would range
between $1 million and $2 million through paygo investments between now and 2025.
Any investment from the City would be from residual tax increments, future project
related tax increments and /or ED Trust Fund investments.
The Community Center Task force met on July 26, 2011. The task force opined the
following:
1. The City should not feel compelled to rush decisions regarding Community
Center /Fitness projects only to meet a November 8 referendum date
2. The Y facility as currently configured may not meet citizen beliefs as to what
comprises a community center absent potential space planning changes to place
community rooms /playgrounds and the like in a location within the building so that
these spaces could be accessed without a Y membership
3. The City could consider a multi -phase effort to meet our community and recreational
needs
4. The City might consider constructing a portion of those needs in an early phase with
the Y portion of those needs in a later phase
5. The City should complete its' negotiations on the Home Depot redevelopment before
proceeding with a Y or Community Center development
The City Council is currently scheduled to determine a path at their August 10, 2011 meeting.
2. Work Force Rental Housing
It has been suggested that the City should consider encouraging moderate income
rental housing within the community. I've enclosed a brochure from a recent affordable
product completed within the City of Elk River. This project is a tax credit deal for
households generally between $ and $50,000 (or thereabouts). Rents range
from $640 for a 796 SF one bedroom up to $850 for a 1,332 SF three bedroom unit. In
order to qualify for tax credits through a competitive process the developer would be
requesting fee waivers and perhaps various other development assistance. The project
cost estimate for this 53 unit building is $160,000 /unit. It is only due to the flax credit
mechanism that development of this project would even be bankable. The tax credit
competition occurs each June for a project start in the subsequent year with a 9 month
build out.
It is worth noting that in order to qualify for a $100,000 mortgage @ 5 %/30 years an
income requirement would be estimated at $25,000 to $31,000 (depending upon other
consumer debt). The PITT obligation would be estimated at $777 /month which would be
comparable to a two bedroom within the tax credit rental project.
We would be looking for direction on if encouraging a project similar to the Elk River
example is something we should be pursuing.
Consensus Opportunities:
1. Provide comments on general EDA work plan priorities
2. Provide comments on future Community Center / Fitness direction
3. Provide comments on work force housing
Aug 3 Work Plan Priorities 072611
Economic Development Authority
Work Plan and Goals
August, 2011 DRAFT
City Council Vision for Cottage Grove:
• An accessible community with an appreciation for our environment, trees,
hills, ravines, landscapes and river, including quality park, green and open
space areas
• A good place to raise a family and grow a business with well maintained
neighborhoods and private properties
• A fiscally responsible, engaged government with well maintained
infrastructure, access to quality inter- and intra- community transportation and
transit, and safe residential and commercial neighborhoods and public spaces
City Council Development Goal (C /1):
*Place emphasis on quality retail, restaurant, and industrial recruitment and
retention. Development enhancements within all commercial districts include the use of
development controls, architectural standards and high quality site features
Objectives: The City Council has adopted five C/I objectives in achieving the
primary goal Each of these objectives is noted below (1 -5) followed by Targets and
Tasks provided or performed by staff in accomplishment of the objective. Some tasks
would be considered complete with compliance or monitoring the only requirement.
Others are ongoing or in process. The remaining is either in an interim step or requires
input from Council in order to complete the task.
1. Continue to increase quality of commercial structures and
neighborhoods
Targets and Tasks:
a. Increase Commercial Quality
1, Gateway Development Standards (adopted)
2. East Ravine Master Plan (adopted)
3. 1_angdon Master Plan (adopted)
4. West Point Douglas Plan
5. Auto Performance Standards
b. Increase Neighborhood Quality
1. East Ravine Master Plan (adopted)
2. Code Enforcement (on- going)
3. Revision of Subdivision Development Standards
2. Prospect for specific end users by category, including restaurants
big /junior box and specialty retailers and service and entertainment
venues as identified in the 2009 commercial market study. Provide a
list of specific measures taken and specific contacts made to both
commercial and Industrial prospects. Concentrate industrial
prospecting on high job industries Include results within annual
performance measures
Targets and Tasks:
a. Prospect for Business Park
1. Update Growth Partners Marketing / Branding
2. Relational Marketing
3. Cost Segregation program
4. Incubator Program consideration
5. DEED /Third Party grants & loans
6. Web data
b. Prospect for Commercial
1. Home Depot Redevelopment (in process)
2. Cottage View Redevelopment (in process)
c. General Marketing
1. Prospecting Events
a ICSC
b. MD &M
c. Life Science Alley
d. Other
2. Print Media
3. Website
4. Press Releases /events
5. Anaiytics
6. Identification of Targets
7. QR Codes
8. Business Recognition programming
a. Ribbon Cutting/ Ground Breaking
b. Years in Business Awards
c. Growth Partners Awards
d. Coordinate with Chamber Programming /Events
9. Developer Tech Review opportunities
3. Provide for continued development of the industrial park
redevelopment of the Gateway District and planning for the Cottage
View and infill sites including the Rodeo and Majestic redevelopment
opportunities. Include a business community feedback mechanism to
include prospects not attracted to a local development site Improve
reporting to EDA and Council
Targets and Tasks:
a. Reporting to EDA/Council
1. Development Update (monthly)
2. Tech Review Committee
1 Community Development Newsletter (monthly)
4. Various Matters
5. All Commission meetings
6. Goals / Strategic Planning workshops
7. Annual Report /EDA Annual Report
b. Business Feedback Mechanism
1. Survey
c. infill
1. Website marketing (on- going)
2. RFP City sites
3. Package Future sites (i.e. Langdon)
4. Update business attraction /retention marketing plan and strategy
Targets and Tasks:
a. Business Retention
1. Site Visits
2. C/I Neighborhood Meetings
3. Recognition of Milestones
b: Business Attraction and Recruitment
i. Marketing
a. Post Card campaign
b. www.gro artnerscg.com
c. EDA Golf Outing
d. Relationship Building
2. Social Media
3, Targeted Industries and Sectors
a. Business Park Land Transactions
b. Commercial Redevelopment
c. Focused retail end user targets
4. Cost Segregation value added service
S. Land Banking
6. TIF /Trust Fund Investments
7. DEED Grant Funding
c. Business Start-Up
1. Incubator
2. Micro - lending
a. Bank Community Investment Leveraging
5. Provide for enhanced Chamber. EDA and Council business outreach
coordination
Targets and Tasks:
a. Increase Coordination
1. Government Affairs and Development Committee
2. EDA Chamber Board Liaison
3. Chamber Board membership
4. Event Coordination
a. Ribbon cuttings /ground breakings
b. Annual 3M Chamber Business Breakfast
c. Annual Business Showcase
d. Strawberry Festival
e. Holiday Train
f. Misc. (involvement with various events thru the year)
Housing
The EDA does not have specific responsibilities in the area of housing.
However, from time to time the EDA may be requested to perform a role in the
housing area in situations such as mixed use projects (i.e. Norris
Square /Marketplace). The EDA needs to also monitor housing activity as it
relates to its responsibilitieswfth business attraction and should be aware of
community standards in housing as well as C/i projects as established by the
City Council.
The 2011/12 Housing Goal and major objectives as established by Council is as
follows:
City Council Housing Goal:
Ensure that implementation of the master plan for the East Ravine District
includes only high quality, high design and amenity development stressing the
natural environment complemented by the built environment. Emphasis is
placed on diversity of housing styles targeting the second and third tier move -
up buyer along with empty - nester housing. All future housing developments
should strive to reflect the community vision established through the East
Ravine planning process. Encourage the maintenance of current housing
stock through increased code enforcement efforts
Objectives
1. Ensure that all rental- housing units are identified and monitored for code
compliance
2. Aggressively monitor foreclosed properties
3. Provide for additional Empty Nester housing such as the Auburn Woods
development. Consider density bonuses to provide for this housing type.
4. Provide for targeted high -end development in the East Ravine and West Draw
portions of the Community — with densityfiexibility.
5. Provide opportunities for high - density townhomes, apartments, affordable
rentals and condo projects along with a non - senior assisted living project.
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