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HomeMy WebLinkAbout2013-07-09 PACKET 03. CITY OF COTTAGE GROVE E CONOMIC D EVELOPMENT A UTHORITY MINUTES June 11, 2013 Pursuant to due call and notice thereof, a regular meeting of the Economic Development Authority was held at Cottage Grove City Hall, 12800 Ravine Parkway South, Cottage Grove, Minnesota 55016 on the11th day of June 2013. I. CALL TO ORDER The meeting was called to order at 7:30 a.m. by EDA Vice President Thiede. II. ROLL CALL Members Present: Dave Thiede, EDA Vice President Paul Poncin, EDA Secretary/Treasurer (Late Arrival) Craig Patterson, EDA Member Laurie Levine, EDA Member Members Absent: Myron Bailey, EDA President (Excused) Steve Schmid, EDA Member (Excused) Ramona Westerberg, EDA Member Staff Present: Ryan Schroeder, EDA Executive Director Danette Parr, Economic Development Director Robin Roland, Finance Director Staff Absent: Others Present: Emily Buss, South Washington County Bulletin III. APPROVAL OF MINUTES (delayed due to a lack of quorum initially) IV. BUSINESS ITEMS A. Development Update EDA ED Schroeder provided the development update. EDA ED Schroeder shared that at their meeting of June 5, 2013 the City Council granted Concept review of the proposed Economic Development Authority - Minutes June 11, 2013 Page 2 66 unit Summerhill Crossing project. This is a market rate senior building estimated at a taxable market value of $9 million which was also represented by the development team as generating in excess of $700,000 per year in payroll with 23 FTE’s. EDA ED Schroeder reviewed the concept rendering and revisions that were discussed at the recent Council meeting. EDA Vice President Thiede shared that while the most recent concept wasn’t exactly what he may have hoped for to allow retail/restaurant to be a part of the site, there are positive improvements from what was first proposed. EDA ED Schroeder provided additional development activity information related to the following projects: Ryland Homes At their meeting of June 5, 2013 the City Council granted Concept review of the proposed th 135 unit addition north of Michaels Pointe (west of Jamaica, north of 70). East Ridge Woods At their meeting of June 5, 2013 the City Council granted development agreement approval for the East Ridge Woods subdivision. That subdivision, on the north side of th 70 Street just west of Keats now has all of its entitlements in place CSAH 20 Transfer At their meeting of June 5, 2013 the City Council accepted transfer of ownership of that th portion of CSAH 20 (70 Street) east of Keats which is being replaced by new th construction of 70 Street to align with that portion west of Keats. The City will operate th the former 70 Street as a local access road until such time as the adjacent areas develop further. Jamaica Feasibility Study In May the Council authorized development of a feasibility study to reconstruct Jamaica th Avenue between 70 Street and Military Road. Upon completion of this section of roadway in 2014 or 2015 it will be turned over to the County. The County, therefore, is anticipated to pay the substantial portion of the project cost. New population estimates Each year the Metropolitan Council updates population and household estimates for all communities within the region. As of April 1, 2012 Cottage Grove is now estimated to be home to 35,187 persons within 11,896 occupied housing units. In total we are adjudged to have 12,240 housing units in existence. Our staff estimates for population growth for 2013 is 35,335 and we are projecting population in 2014 and 2015 to be at 35,424 and 35,603 respectively upon the assumption of 35 new homes being constructed this year and 70 next year. Building Permits Commercial/Institutional permits for May include the new 3,608 SF Tumble Fresh at 8470 E. Pt. Douglas, the interior remodel of 1,506 SF for Prescott Chiropractic at 7145 E. Pt. th Douglas, a remodel of the BEC at 7516 80 Street for two tenant spaces and an addition to Building 143 on the 3M campus at 10746 Innovation Road. In total we have permitted $9,148,601 in commercial permits through May which is ahead of the pace of the past Economic Development Authority - Minutes June 11, 2013 Page 3 four years and actually is a fairly typical year in comparison to the past twelve YTD. With activity that is on the boards we anticipate that the commercial portion of our permit activity will exceed the mean of the past twelve years by year end. In total we are at $14,854,060 in permit values YTD. This is at half the pace of the prior twelve years which is due, not unexpectedly, to the reduced pace of home construction. Slowing home construction is due to the lack of available lots within the community which is expected to change by fall. New subdivisions (Mississippi Dunes, Ryland/Michaels Point, East Ridge Woods and Ravine Meadow) signal an active home construction year for 2014. At this point we are projecting 2013 home production at 35 units with an increase to 70 single family units for 2014 with continued ramping up beyond 2014 (Summerhill, if ultimately approved, may add up to 66 multi-family units for 2013/14). EDA ED Schroeder gave a BEC update related to the two new tenants (Gopher Mods and Connex Space). Schroeder also mentioned three additional tenants that are likely to join BEC in the near future. The July EDA meeting will likely be held at the BEC with the BEC Board to discuss tenant improvements and the possible design of the future training center. B. River Oaks Draft Business Plan EDA ED Schroeder introduced the draft River Oaks Business Planto the EDA and asked for initial feedback. EDA ED Schroeder indicated that additional business plan information would be coming to the EDA at the July meeting. EDA Member Patterson indicated that that he’d like to see a bit more on the restaurant use. He stated he believes there is an opportunity there. EDA Member Poncin asked if we no longer treat River Oaks as an enterprise fund, what happens with the money they owe the EDA. EDA ED Schroeder answered that there are four options: 1) We’d wipe it clean to the extent we can. 2) Issue debt to repay the money owed or a portion of it. 3) Set-up a payment plan internally. 4) A mix of options 1-3. ED VP Thiede asked about other opportunities similar to the current Fish Friday events. Thiede suggested events for such things as Oktoberfest to draw patrons in. EDA Member Patterson asked Finance Director Roland what she felt was the best way to handle the debt. Finance Director Roland responded that an internal payment over 10 years with a balloon payment at the end may be something to consider. EDA ED Schroeder explained that the River Oaks conversation is very similar to the conversation experienced by the CG Ice Arena approximately15 years ago. Finance Director Roland added that River Oaks should be looked at the same as the park Economic Development Authority - Minutes June 11, 2013 Page 4 system or other similar amenities. EDA VP Thiede stated that it would be interesting to see what percentage of the target market lives in Cottage Grove and takes advantage of the membership offering. EDA member Patterson stated that River Oaks needs to tap into other revenue streams and make people aware of what we have to offer. EDA ED Schroeder also indicated that we’ve seen a situation where the patrons don’t utilize the offerings, such as the proshop. EDA VP Thiede asked if River Oaks has good Wi-Fi and other things that would make it business friendly. EDA VP Thiede indicated that those investments should be made. Finance Director Roland stated that the necessary expenditures may be difficult to cover. Roland provided information related to the City of Brooklyn Park course and how they are creatively contracting out for their banquet facility, but still losing money. EDA VP Thiede stated that the only way for River Oaks to make money is by increasing the revenue and decreasing the cost. Thiede also stated that he’s ok with subsidizing what it costs for people within our City (citizens), but not necessarily for others. EDA member Poncin stated that he can’t envision anymore cutting measures, but instead that we need to increase income. Poncin added that he believed this could be done by giving away popcorn and likely increasing drink sales. EDA member Levine suggested that it might be worthwhile to contract out the River Oaks kitchen as a commercial kitchen for lease during down times. C.ICSC Review ED Director Parr gave a review of the ICSC RECON conference held in Las Vegas, nd Nevada on May 19-22. Mayor Bailey and ED Director Parr met with over 24 people in the two days that they attended the conference. A concentration of the meetings involved the Shoppes at Cottage View, but there were also opportunities to discuss Home Depot and other vacant land and buildings within Cottage Grove. Follow-up from these meetings continues to take place and tours with retailers/developers are in the works. D. PACE Program EDA Director Parr introduced the Property Assessed Clean Energy (PACE) program to the EDA. Parr explained that the PACE program is a financing tool that allows up-front, private capital to pay for building upgrades that facilitate clean energy improvements. The program is currently focused on commercial, industrial, and non-profit buildings. The PACE program is a special assessment- backed loan from the local government to pay for a variety of energy efficiency improvements that are permanent improvements to the building. The local government entity provides the loan, and the building owner voluntarily agrees to repay the loan over 5 to 10 years on their property taxes. Due to the volume of staff time necessary to administer the program, there are some changes being discussed in relation to having an outside entity administer the funding and administration of the program. It’s anticipated that the changes will be solidified in the next month and a Economic Development Authority - Minutes June 11, 2013 Page 5 test project conducted through the City of Eagan to assure that all necessary procedures are addressed. It’s anticipated that the PACE program will come before the EDA again in July or August and then the EDA recommendation will be forwarded to the City Council for their consideration. V. MISCELLANEOUS BUSINESS ITEMS EDA ED Schroeder shared with the EDA that Council had discussed the idea of having all commissionstelevised in the future. Due to the nature of some confidential issues, it may be necessary to have closed EDA meetings from time to time. EDA VP Thiede stated that he had no issues with the meetings being televised, but that everyone would need to stay aware of when closed meetings were more appropriate. EDA VP Thiede said it might be good to talk further about the business postcard mailing that was done in partnership with Colliers. ED Director Parr stated that the postcard mailing in partnership with Colliers was completed a few weeks ago and that Colliers was doing follow-up calls from the list. EDA VP Thiede shared information in relation to the Strawberry Fest and the Business Expo. There were 76 booths this year and 10-12 booths on multiple days this year. EDA member Poncin asked if River Oaks could do beer/wine sales in future years at Strawberry Fest. EDA VP Thiede explained how it worked to become a vendor at Strawberry Fest and the existing beer/wine vendors. APPROVAL OF MINUTES EDA VP Thiede asked for approval of the May 14, 2013 minutes. ED member Patterson moved to approve the minutes, which was seconded by ED member Poncin, all present were in favor. VI. CALENDAR The EDA members were reminded of upcoming meetings and events. VII. AJOURN EDA member Poncinmoved to adjourn the meeting. Seconded by EDA member Patterson, all present were in favor. Respectfully Submitted, Danette Parr Economic Development Director