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HomeMy WebLinkAbout2009 Annual Report2009 ST. JOSEPH EDA: ANNUAL I fl, =film I St. Joseph EDA City of St. Joseph 12/2/2009 ST. JOSEPH EDA: ANNUAL REPORT EXECUTIVE SUMMARY 2009 The St. Joseph Economic Development Authority (EDA) continued to promote business interests within the City in 2009. Although significant challenges to economic growth continued to persist, this report illustrates the EDA completed a record year of growth, assisting in the creation of new wealth, 'setting the table' for new business opportunities, providing assistance to businesses to spur economic investment and job creation locally, and to conduct outreach to business contacts. Following is a summary of EDA activities in 2009: ■ Calendar year 2009 was a great year for tax base expansion in St. Joseph. Approximately $8 million commercial real estate value was added to the City's tax base, the largest in a single year since the EDA formed in 1998. Commercial building activity in 2009 equates to a $75,000 increase in City tax revenue and a similar increase in county tax revenue. In addition school district tax revenue, state (portion of property taxes), and other taxes entities (e.g. watershed) also increased. As City leaders are aware, the global economic downturn has lead to declines in new housing starts locally for the past few years. Reports from economists regarding the recession that began in 2007 are highly variable. Many economists predict the recession that began in fall of 2007 has ended but recovery will be slow, some economists doubt the recession has ended, still other economists warn of the potential for a 'double dip' recession in 2010. In any case it's prudent to expect building permit trends will very slowly turn around, overall economic performance will be weak to tentative, and unemployment will continue to plague the area. The lingering recession (or tentative turn - around) is expected to continue to impact the EDA's activity in bringing /touting new investment in the community in the form of rooftops and population growth. It is noted new housing starts rebounded slightly in 2009 but are not anywhere near peak years of 2005 and 2006. Unemployment last year at this time (January 2009) was higher that state average, now (January 2010) it is significantly lower than the state average. As a whole, the EDA and /or staff are aware of several local businesses that are struggling. The past year (2009) featured construction initiation /completion for Coborn's Superstore and Central Minnesota Federal Credit Union. The EDA was instrumental in that tax abatement was issued for the Coborn's project. Without abatement the project would have been shelved for an estimated ten years due to lost market share applicable to a discount superstore opening in Sartell. Coborn's green - lighting of the superstore in 2009 led to the construction of the Central Minnesota Federal Credit Union and the platting of the parcel north /west quadrant of 133/75 by the Credit Union. An estimated 150 jobs were added to St. Joseph due to Coborn's and Credit Union construction and opening. Additional spinoff development at 133 is expected as the EDA has been receiving inquiries regarding traffic volumes and services at the intersection. An EDA sponsored Market Study in 2007 indicated retail trade area would increase by 150% as a result of Coborn's opening. City of St. Joseph I EDA Annual Report - 2009 2 ST. JOSEPH EDA: ANNUAL REPORT 2009 ■ An optometrist's practice and a mental health professional practice were added to Millstream Shops /Lofts center. Also related to the Millstream building the EDA assisted in redefining banners /signs for the Millstream building. ■ The Local Blend completed a fagade face lift with help from the EDA's Revolving Loan Fund (RLF) and Business Facade Architectural (BFA) Grant program. Scenic Specialties completed fagade work on two historic accessory structures with assistance from the BFA grant program. One BFA application and one RLF application are currently pending. The EDA/staff continued to market St. Joseph to commercial /industrial prospects. A website overhaul in 2009, included the addition of a 'one stop for business' information page which includes information regarding how to start a business, how to choose a business organization, how to create a business plan, licensing /permitting information, zoning /site plan review information, available sites in St. Joseph, technical and financial assistance available through the EDA, advantages of doing business in St. Joseph and advantages to doing business in Minnesota. The City website also includes a page listing available sites and buildings as directed or acknowledged by property owners. The EDA provides updates on available land and buildings in St. Joseph to the St. Cloud Area Economic Development Partnership and MnPRO (statewide) website. The EDA/staff continues to promote downtown redevelopment. Landscaping /streetscaping planning is underway as commissioned by the EDA. Goals of the planning (and eventual construction) are to tie the following areas together with meaningful visual linkages: Wobegon Trail Center, College Avenue, Minnesota Street, and Minnesota Street to the west toward new CSAH 2 areas together. The EDA has reached out to several business owners and community service organizations to alert them to the design project. When complete in late winter /early spring the design plan will be presented to said businesses and community service organizations as a forerunner to fundraising activities. ■ The EDA's 2010 capital projects approved for 2010 include $20,000 for `revitalization efforts' which may include BFA grants, streetscape /landscape design /implementation, and rental conversion. ■ The EDA held a "Business Builder Breakfast" and listening session in June. Feedback from the event was positive and more will are being planned for 2010. ■ EDA and staff have worked tirelessly with St. Cloud State University Economic. Development Center on a study regarding the economic impact of CSB /SJU on the St. Joseph economy and the impact of a residency change. EDA/staff have met with CSB /SJU officials and landlords as part of the process. As a result of such meetings a group of landlords have signed up to assist the EDA/City with moving forward and creating a rental housing transition program. ■ The EDA met 13 times this year, 12 regular meetings and one special meeting. A total of ten new consistent business contacts were cultivated during the year. Follow up occurred with 23 carryover business contacts from previous years. ■ The EDA met formally with Gateway Commons Developers and representatives from the Walz families regarding development of property in conjunction with new CSAH 2 construction which is slated for next year. EDA/staff met with real estate representatives and owners of DBL/MCO buildings on numerous occasions. In addition the facilities were toured and examined for potential to lease portions of the building to different tenants. EDA staff contacted the Minnesota Department of Employment and Economic Development (DEED) bio- business specialist regarding marketing the MCO building which has a 100,000 Clean Room and is highly suitable for bio- research (or defense operations) and which is located within the St. Cloud Bio- Business Zone. ■ EDA continues to distribute information to project leads, review land use standards /provide advice on land use standards, participate in staff meetings and projects, and retain inventory of parcels. City of St. Joseph I EDA Annual Report - 2009 3 ST. JOSEPH EDA: ANNUAL REPORT 2009 ■ Moved forward on 2009 goals including proactive participation in preparing for development adjacent to new CSAH 2. Marketing St. Joseph. Reviewing local impact of residency policy changes. ■ Efforts at outreach to industrial establishments continues to be plagued by a severe shortage of shovel ready industrial lots and the lingering effects of the recession which began in late fall of 2007. ■ Goals for 2010 include, but are not limited to: 1. Investigate and pursue proactive measures to secure and provide for shovel ready industrial sites and encourage build -out of Parkway Business Center. 2. Work with property owner to proceed with St. Joseph Professional Plat. 3. Continue to work with property owners seeking development of land adjacent to proposed CSAH 2 including, but not limited to, seeking federal EDA funds to install utilities in said areas. 4. Host at least two events for business owners (similar to the Business Builder Breakfast held in 2009). 5. Continue to market available commercial and industrial lots, land, lease space, buildings, etc. 6. Continue to respond to inquiries and continue proactive follow up of viable leads /prospects. 7. Continue website development and updates. 8. Continue to pursue revitalization within the Downtown through: • Promotion of the Business Facade Architectural (BFA) Grant Program, • Competition and revealing of the land /streetscape design (includes connecting Wobegon Trail Center to College /Minnesota, west Minnesota to new CSAH 2) plans being completed by Scenic Specialties and fundraising related thereto, and • Collaboration with interested parties. 9. Continue to address rental unit conversion issues resulting from residency requirement changes at the College and University. 10. Continue to implement/administer technical and financial incentive programs. City of St. Joseph I EDA Annual Report - 2009 4 ST. JOSEPH EDA: ANNUAL REPORT 2009 APPOINTMENTS: The following appointments to offices were made at the January 28, 2009 EDA meeting: Chair: Dale Wick (Council Member, term expires with Council Term). Vice Chair: Ken Jacobson (At -large representative; term expires 2011). Treasurer: Tom Skahen (At -large representative, term expires 2013). Secretary: Carolyn Yaggie- Heinen (At -large representative, term expires 2012). Member at Large: Al Rassier (Mayor, term expires with Mayoral Term). MISSION: 2009 The mission of the EDA is to provide a professional municipal economic development program that assists industrial and commercial development activities which minimize impacts to the environment, transportation system, municipal water /sewer use, and financial resources for the City of St. Joseph. CORE FUNCTIONS AND STRATEGIC DIRECTIONS: The St. Joseph EDA, as a driving force for economic development, pursues the following core functions and strategic directions: Omanizational Development The City of St. Joseph has an economic development organizational structure in place. The structure is prescribed by Ordinance with day to day operation governed through EDA by -laws and administrative (consulting) staff. The EDA works closely with the Planning Commission and City Council. Infrastructure Development If the support infrastructure system needed to deliver and produce goods and services is not in place, economic development is unlikely to occur, in this respect the EDA 'sets the table' for development. Infrastructure needed to support economic development includes basic facilities and services (i.e. wastewater, drinking water, roadways, stormwater, schools, gas, electric, telephony, etc.) and providing for available sites (e.g. business park development), gateway programs, downtown revitalization programs and speculative building projects. Since the St. Joseph EDA has since its inception been active in the development of a business park, the establishment of gateway districts and implementation of a downtown revitalization project. Business Development Business development efforts center on three general programs: business recruitment, entrepreneurial development, and retention /expansion. The St. Joseph EDA has an active business recruitment program including: information on the local business climate, active lead follow -up, inventories of available properties, business basics and start up information, business incentive programs, available & current demographic information (i.e. population make -up), general market data (housing, employment, business mix, market potential, etc.), and information on current and planned projects including market absorption rates and estimates of current square feet per use. Efforts to encourage entrepreneurial development are currently a strategy the St. Cloud Economic Development Authority is actively pursuing. The Partnership and other organizations are working to create an environment conducive to the development of a strong bioscience — biotechnology hub. At this time the EDA has not actively pursued specific entrepreneurial development projects. This is a potential opportunity the EDA may explore with the Donald McNeeley Entrepreneurial Center (CSB) or the Anderson Center (SCSU). City of St. Joseph I EDA Annual Report - 2009 5 ST. JOSEPH EDA: ANNUAL REPORT 2009 The St. Joseph EDA organized and formally renewed a 'business retention and expansion' outreach effort in 2009. The item was discussed at length and modestly pursued in 2009. In reality business retention /expansion (BRE) occurs on an on -going basis: (1) as leads are initiated, received, followed -up on, and pursued; (2) as available properties /establishments are identified (toured) and promoted; (3) and as technical and /or financial assistance is sought. The 2009 BRE outreach effort started with an update of the 2006 -07 program survey. After discussion at several EDA meetings the thought of EDA members surveying a list of business owners was converted to a "Business Builder Breakfast" event. The goal of the breakfast was to get business owners talking with EDA members in a neutral setting. Postcard invites were mailed to over 100 business owners with only a handful of people attending the meeting. The EDA concluded the event was useful and low attendance was not surprising. One outcome of the breakfast meeting was to post more information on the City's website relating to 'one stop' business information and available properties. Workforce Development Workforce development activities in Minnesota are generally coordinated by Workforce Development Centers located throughout State. The 47 existing Workforce Development Centers provide service to anyone transitioning from one job to another, from school to work and from welfare to work situations. The Workforce Development Centers also provide service to those entering the workforce for the first time. Services can be customized to meet specific needs of each individual. Workforce development centers have historically pursued bottom -up (i.e. working with educational institutions to provide relevant education for employment opportunities expected in the future) and top -down (i.e. working with businesses to educate their workforce and /or working with businesses to identify types of worker skills needed) strategies in an effort to link available educational opportunities with business needs. Market Development There are two ways a community can bring new dollars in: attract new individuals and /or attract new organizations (e.g. businesses, non - profits, educational organizations, government, etc). The St. Joseph EDA has historically focused primarily on attracting new organizations; however, the EDA has continued to support attracting new individuals to the community as well. A key marketing tool utilized by the EDA is the City's website. Throughout the year a new webpage for 'one stop' business information was developed and published. The 'one stop business information page' provides information, resources, links, and advice covering the following topics: • How to evaluate a business opportunity. • Choosing a business organization. • Creating a business plan. • Licensing and permitting information (federal, state, and local requirements) • Zoning and site plan review information and resources • Available sites in St. Joseph • Technical and financial assistance available through the EDA • Advantages of doing business in St. Joseph • Advantages of doing business in Minnesota The information contained under the "Community Development' heading on the City of St. Joseph website is updated on a consistent basis with several sub -pages completely overhauled in 2009. City of St. Joseph I EDA Annual Report - 2009 6 ST. JOSEPH EDA: ANNUAL REPORT 2009 2009 MEETING DATES: The St. Joseph Economic Development Authority met 13 times during the year 2009. The meeting dates were as follows: January 28, 2009 February 25, 2009 March 25, 2009 April 22, 2009 May 27, 2009 June 15, 2009 June 24, 2009 DIVERSIFICATION OF THE TAX BASE: FIGURE 1.1 July 22, 2009 August 26, 2009 September 23, 2009 October 28, 2009 November 18, 2009 December 23, 2009 The following table reflects historic building permit values for commercial and industrial (re)construction: TABLE 1 -1 CITY OF ST. JOSEPH HISTORICAL COMMERCIAL & INDUSTRIAL CONSTRUCTION Year _ Value 2009 $7,216,910 2008 $3,690,877 2007 $3,376,221 2006 2005 $1,259,957 $2,790,11 2004 $2,708,838 2003 2002 $3,461,695 $4,687,430 2001 $593,000 2000 -$361,500 TOTAL $30,146,545 The following summary and chart indicate the progress toward the EDA's goal of enhancing the commercial industrial tax base: City of St. Joseph I EDA Annual Report - 2009 7 ST. JOSEPH EDA: ANNUAL REPORT 2009 TABLE 1 -2 ESTIMATED ANNUAL INCREASE IN COMMERCIAL/INDUSTRIAL TAXES PAID FOR ALL JURISDICTIONS YEAR 1997 $ CITY 5,592 $ COUNTY 4,905 $ SCHOOL 5,500 $ STATE 6,303 $ MISC. 245 1998 $ 16,242 $ 14,248 $ 15,976 $ 18,306 $ 196 1999 $ 12,995 $ 11,400 $ 12,783 $ 14,647 $ 44 2000 $ 2,909 $ 2,552 $ 2,862 $ 3,279 $ 70 2001 $ 4,611 $ 4,045 $ 4,536 $ 5,197 $ 637 2002 2003 $ $ 42,144 31,528 $ $ 36,971 27,658 $ $ 41,455 31,012 $ $ 47,500 35,535 $ $ 476 1,753 2004 2005 2006 $ $ $ 21,224 26,785 2,419 $ $ $ 20,707 22,516 2,366 $ $ $ 23,218 25,134 691 $ $ $ 26,604 28,512 2,531 $ $ $ 357 382 35 2007 $ 23,843 $ 22,916 $ 7,596 $ 25,092 $ 363 2008 $ 33,913 $ 34,027 $ 8,011 $ 37,120 $ 601 2009 $ 72,259 $ 72,017 $ 17,008 $ 69,683 $ 1,273 TOTAL , $ 296,466 $ 276,329 $ 195,783 $ 320,310 $ 6,433 Based on taxes payable 2009 FIGURE 1.2 ESTIMATED ANNUAL INCREASE CITY TAX REVENUE DUE TO COMMERCIAL/INDUSTRIAL NEW & REDEVELOPMENT City of St. Joseph I EDA Annual Report - 2009 8 ST. JOSEPH EDA: ANNUAL REPORT 2009 2009 PROS PECTS /TECHNICAL ASSISTANCE /COORDINATION The EDA members and their staff /consultants worked with a number of commercial and industrial businesses during 2009. Ten new business contacts were made during 2009 and follow -up occurred with 24 contacts from previous years. Of the new prospects 90% were commercial /service businesses. In 2008 75% of new leads were commercial with the remaining 25% industrial. In 2007 60% of new leads were commercial while 40% were industrial. In 2006 44% of new leads were commercial and 56% industrial, the percentage distribution was the same for 2005 leads (44% commercial and 56% industrial). In 2004, 60% of new contacts were commercial /service establishments and 40% industrial; during 2003 43% of the new contacts were commercial /service businesses while 57% were industrial or manufacturing businesses. The change in business prospect categories likely reflects the limited availability of industrial lots and the struggling economy. Following is a summary of the various contact activities within 2009. Businesses have been identified with a project number to protect the confidentiality of the company, which is sometimes a concern while they explore expansion opportunities. Project 01 -E: This project finalized construction in 2009 bringing nine years of business expansion activity relating to this lead to a close. Project 02 -L: This project resulted in the construction of a new business facility in 2003. The facility was oversized so as to accommodate future expansion. In the interim the space is leased to other industrial occupants. The EDA's MDG continues to market the industrial lease space on the City's website, the MnPRO site, the SCAEDP site, and with local commercial realtors. Project 03 -A: This group of Developers is contemplating a large highway commercial development in an area not yet annexed into the City. MDG continues to maintain active correspondence with this prospect. These contacts are now working with Project 074 This project will be impacted by construction of new CSAH 2. The full EDA Board met with the Developers in 2009, a SCAMP bus tour stopped at the site, and MDG continues to maintain regular correspondence and meetings with the Developers. Project 04 -E: This project involves a restaurant facility. The restaurant opened in St. Joseph in October of this year after five years of follow -up. Project 04 -H: This project involves an underutilized commercial mixed use in the Downtown. This property was the subject of intense internal discussion between the then property owner and City staff throughout the summer. Preliminary drawings, preliminary runs of numbers for tax increment financing (redevelopment) and work on a redevelopment grant ensued as discussions continued. The property owner during the summer then backed away from the project and sold the property to another owner. Project 04 -N: This business is currently a home occupation in an adjacent area. The business has purchased a lot within Buettner Business Park. The construction timeline is tentatively 2011, although the contact remains open to a land for building swap. MDG remains in touch with the property owner. Project 04 -S: This project involves a large phased development the majority of which reverted to bank ownership and back to the original land owners. A preliminary plat was approved in 2008 for a portion of the property, the final plat was approved but not recorded as a development agreement was not finalized. MDG has been in contact throughout the fall with a commercial real estate agent who is working with the bank -owned portion of the property. MDG continues to follow up. City of St. Joseph I EDA Annual Report - 2009 9 ST. JOSEPH EDA: ANNUAL REPORT 2009 Project 05 -A: This project involves a former feed mill. The EDA's MDG continues to market the site on the City's website, the MnPRO site, the SCAEDP site, and with local commercial realtors. Project 05 -I: This project resulted in the largest private development investment in the Downtown in history of the City. This year two new storefronts were added to the commercial portion of the facility. A bus tour of commercial real estate agents and site selectors toured the facility in September. One more commercial unit remains available for sale, in the interim the bay is used by local artists to exhibit works. MDG continues to work with the property owner to market the end -cap site on the City's website, the MnPRO site, the SCAEDP site, and with local commercial realtors. In addition MDG provides zoning code interpretation for the City /property owner relating to the end -cap on an as- needed basis. Project 05 -F: This project moved forward and was completed in 2009. The project resulted in the opening of a supermarket in St. Joseph which, according to a 2007 study by McComb Group, LTD., will expand the retail trade area of St. Joseph by 150 %. The construction and opening of the facility added an estimated 150 jobs to St. Joseph. The EDA/City assisted the project with use of tax abatement. The City's participation through abatement allowed construction to begin /end in 2009 versus waiting ten additional years. The driving force behind the momentum for this project was the development of a superstore in Sartell and an attempt to secure market share prior to the opening of the superstore. Abatement was requested as an independent financial evaluation illustrated a projected operating loss for the business for the initial several years due to cannibalization from existing stores and market area population. Project 06 -H: This project involves the development of commercial /residential property adjacent to CSAH 75 and Millstream Park. Strack remains in active contact with this representative, especially as it relates to CSAH 2 construction and the CPU. The Developer's engineer recently met with the City Engineer and Public Work's Superintendent regarding development plans and utility extension. The subject property is guided toward future highway commercial mixed nodal development. Project 06 -I: This project involves the marketing of a 30 -acre parcel adjacent to 20th Avenue. The property owner changed real estate managers in 2009. Strack has met repeatedly with the new property managers and remained in contact with the property owner on a very routine basis. On -going dialogue remains with encouragement for spin -off development from project 05 -F (i.e. organic grocery). Project 07 -A: This project involves the relocation of an industrial supply company. The project was delayed until 2011 by the Company. Occasional contact remains. Project 07 -C: This project involves a property owner's desire to establish a presence in the City of St. Joseph somewhere in the vicinity of downtown. This project was extremely active two years ago but has since cooled. Strack continues to remain in touch with the project contact on a regular basis. Latest discussion centers around the concept of creating a civic district wherein former dwellings are used for business purposes. Project 07 -D: This project involves a potential 1031 exchange of existing acreage guided toward industrial development with existing acreage guided toward commercial development. City of St. Joseph I EDA Annual Report - 2009 10 ST. JOSEPH EDA: ANNUAL REPORT 2009 Project 07 -G: This project involves the expansion of an industrial facility to the City of St. Joseph. The project representatives met several times with MDG in 2002 and in 2008 regarding extension of services to a currently un- serviced area within the corporate limits. The initial project was abandoned due to the cost of utility extension but discussion remains on other potential sites. MDG maintains in occasional contact with project representatives. Project 074 This project has resulted from active outreach to owners of potential industrial property. MDG continues to maintain active correspondence with this prospect. These contacts are working with Project 03 -A. This project will be impacted by construction of new CSAH 2. The full EDA Board met with the Developers in 2009, a SCAEDP bus tour stopped at the site, and MDG continues to maintain regular correspondence and meetings with the Developers. Project 08 -A: This project involves a development in close proximity to the downtown. The Developer continues to refine development plans. Discussion remains on- going, on an occasional basis. The Developer's website continues to promote the project. Project 08 -B: This project involves the construction of a new service facility within the corporate limits. Strack remains in consistent contact with the project representative. Project 08 -C: This local business owner contacted the City after learning of the BFA grant opportunity. Strack continues to discuss a potential downtown project with the business owner. Project 08 -E: This project involves facade of a commercial structure located in the B -2 Highway Business District. BFA assistance has been requested and approved by the EDA. BFA reimbursement occurred in Spring of 2009. Project complete. Project 08 -F: This project involves the expansion of a successful business located in the industrial park which started out as a home occupation. The business owner met with Strack on several occasions in 2008, the economic downturn has slowed discussion. Strack remains in contact with this project contact. Project 08 -H: This project involves facade of an industrial structure located adjacent to CR133. BFA assistance has been requested and was recently approved by the EDA. BFA reimbursement for this project occurred in Fall of 2009. The project is complete. Project 09 -A: This project relates to Project 06 -1 and is listed here as it is under new market direction. Strack has met repeatedly with the new property managers and remained in contact with the property owner on a very routine basis. On -going dialogue remains with encouragement for spin -off development from project 05 -F (i.e. organic grocery). Proiect 09 -B: This project involved the search for a new facility for a business that exists in St. Joseph Township. The company was considering whether the costs associated with development of a site with highway visibility would be offset by increased visibility. The company is generally a manufacturer but also has showroom facilities. Strack met with project representatives on several occasions during late winter /early spring. The company ultimately remained in the township. City of St. Joseph i EDA Annual Report - 2009 11 ST. JOSEPH EDA: ANNUAL REPORT 2009 Project 09 -C: This project involved the subdivision of a four acre parcel at CSAH 75 /CR 133 and the establishment of a professional plat in conjunction with the relocation of an existing clinic in St. Joseph. The project received preliminary plat approval but the Developers were unable to secure project financing. The subject property is expected to benefit from preliminary platting work accomplished in 2009 as it is a likely site for spin -off development from Project 05 -F. Project 09 -D: This project involved the purchase and remodeling of an existing restaurant within the community by the owners of Project 01 -I. Strack met with the Owner on several occasions to discuss zoning related issues and potential landscaping, streetscaping, and parking lot enhancements. Discussions are on -going and the subject site is expected to be included in an EDA authorized streetscaping /landscaping plan currently being completed under the "Let's Go Downtown" project. Project 09 -E: This project relates to the structure included in Project 04 -H. A new project title was created as property ownership changed in 2009. See Project 04 -H for additional information. Project 09 -F: This project involved the location of a new professional service to the City of St. Joseph and the build -out of a commercial unit contained in the structure under Project 05 -I. The EDA assisted this project with a BFA grant that was approved in summer of 2009 and reimbursed in winter. Project is closed and facility is open. Project 09 -G: This project involves the expansion of a local retailer in the vicinity of Downtown. The property owner contacted Strack in summer and met on two separate occasions regarding technical and financial assistance available through the EDA. Strack remains in consistent contact with project representatives. Project 09 -H: This project involves facade enhancement and remodeling of an existing restaurant to accommodate banquet facilities. MDG has met with the project leaders on numerous occasions. The EDA has considered a BFA grant and RLF concept in conjunction with this project. Additional information is required, but the EDA has approved concept of eligibility for BFA and RLF in conjunction with the project. Project 09 -I: This project relates to discussion with a bank that now owns several acres of land under Project 04 -S. Requested information has been forwarded to the project contact. Project 094 This project involved the updating of a facade in a retail building in the Downtown. The property owners applied for and were granted a BFA grant and a small loan from the RLF. The project was completed in December. City of St. Joseph I EDA Annual Report - 2009 12 ST. JOSEPH EDA: ANNUAL REPORT DOWNTOWN REVITALIZATION PROJECT: The "Let's Go Downtown" Revitalization Project continued in 2009. Highlights include: • Two new storefronts added to Downtown (both professional services) • Fagade enhancement at local retail establishment. • Three BFA grants awarded. • EDA funding streetscape /landscape plan development to identify locations for benches, water feature, seating, lingering areas, pocket parks, decorative amenities, etc. • SCSU study regarding economic impact of CSB /SJU commissioned. 2009 The list of short/long term goals identified by work groups previously established /disbanded were pursued throughout 2009 as follows in Table 1 -3. Use of the EDA's business facade architectural grant program was authorized for two downtown projects: The Local Blend and Russell Eyecare. The EDA received Council approval to amend the BFA guidelines to allow use of the matching grant for actual facade improvements. The EDA included a request for continued BFA funding through the 2009 -2013 capital improvement program. M- _ IL, _ _. C=*hftdY6ffKWr0W City of St. Joseph I EDA Annual Report - 2009 13 ST. JOSEPH EDA: ANNUAL REPORT TABLE 1 -3 PROGRESS REPORT "LET'S GO DOWNTOWN" GOALSIWORK ITEMS 2009 Install plaques showing the history of buildings along Minnesota Street. The plaques could provide pedestrians with a reason to stop in downtown and take an interest in buildings and activities inside. A community PAC is following up on this item. Adopt a consistent awning design for Minnesota St. and College Avenue providing a visual connection between buildings in the downtown area. What's most important is that there is the intent to visually link awnings in some way. This was accomplished through approval of Downtown design guidelines. Attach banners on decorative lampposts along Minnesota Street and College Avenue, perhaps extending to Wobegon Trail Center. This concept is part of the streetscapellandscape plan being developed currently. Install directional signage (with the Let's Go Downtownl logo) coming from Highway 94 as well as Hwy 75. This concept is part of the streetscapellandscape plan being developed currently. Install planters, benches and trees on both sides of the downtown streets. This concept is part of the streetscapellandscape plan being developed currently. Refocus the 'Downtown' from areas abutting Minnesota Street and College Avenue to the alley between Mn. Street and Ash Street as suggested by the Mn. Design Team. This concept is part of the streetscapellandscape plan being developed currently. Relocate the powerttelephone cables; if poles or support structures are needed, choose the most visually interesting type. Address vehicle and pedestrian separation downtown... perhaps with wider sidewalks or planters or bushes. This concept is part of the streetscapellandscape plan being developed currently. Install traffic - calming bump -outs in the corridor between the church and the alley and mark with planters or a pedestrian crossing. Consider painting (art) on roadway surface for added interest and slowing of traffic. Bump -outs likely to be a long term item, the remainder are being considered with the streetscapellandscape plan being developed currently. Require dressing up of rear facades behind Mn. Street buildings. Require rear parking spaces be dressed up with planters and some unifying "back yard" elements such as benches, a fountain or a flagpole as suggested by the Minnesota Design Team. Pursue buffering the Parish parking lot with bushesitrees, benches, or a fountain or an information kiosk. More contact with the Church of St. Joseph occurred throughout 2009. In addition, this concept is part of the streetscapellandscape plan being developed currently. Install a connection between both sides of Mn. Street with an arch over the alley between Loso's and the old First State Bank Building and a corresponding featurelarch across the street as envisioned by the Minnesota Design Team's visit many years ago. This concept is part of the streetscapellandscape plan being developed currently. Investigate diagonal parking on Minnesota Street to see if trade -offs can be found (e.g., less parking on the Church side and more parking on the commercial side). Parking options are being driven by a group of local property owners at this time. Create additional off - street public parking spaces in the downtown area. Parking options are being driven by a group of local property owners at this time. Install a'pocket park' or'town square' adjacent to Mn. Street or College Avenue. This concept is part of the streetscapellandscape plan being developed currently. City of St. Joseph I EDA Annual Report - 2009 14 ST. JOSEPH EDA: ANNUAL REPORT CSAH 75 RENEWAL PROJECT: 2009 The EDA Board continued to discuss this item occasionally in 2009, especially as it relates to the impact of residency requirement changes at CSB /SJU and rental property availability resulting therefrom. Potential redevelopment areas adjacent to the CSAH 75 were incorporated in the 2008 Comprehensive Plan Update (CPU) as follows: FIGURE 1.3 POTENTIAL REVITALIZATION /REDEVELOPMENT AREAS Through the CPU process, the EDA and City made a conscious decision to focus redevelopment efforts on commercial and residential areas /parcels in established areas of the City, including those areas illustrated in Figure 1.3. The City /EDA acknowledges revitalization efforts and resources such as staff time and financial incentives may have a higher rate of return if combined with private investment with in identified redevelopment areas. Therefore, public - private partnerships resulting in revitalization /redevelopment of areas included in Figure 1.3 are desired. The City /EDA acknowledge potential barriers to successful redevelopment efforts may include neighborhood opposition, fear of increased density or change, zoning standards (e.g. parking, lot size and setbacks), and increased costs for specialized development. Other areas identified as conducive to redevelopment within the City of St. Joseph include the entire Central Business District and re- use /conversion opportunities within the Central Business District that may be forthcoming due to vacancies within student rental houses resulting from a change in on- campus residency requirements initiated by the College of St. Benedict and St. John's University. City of St. Joseph I EDA Annual Report - 2009 15 ST. JOSEPH EDA: ANNUAL REPORT 2009 CONVERSION OF STUDENT RENTALS /CHANGE IN CAMPUS RESIDENCY REQUIREMENT: The EDA continues to lead the City's response to a change in campus residency requirements for the College of Saint Benedict and Saint John's University. Beginning with St. John's Class of 2011 and St. Benedict's Class of 2012 most students (i.e. 90 %) will be required to live on campus for all four years of their educational experience. The potential impact of the residency change is not fully understood at this point. In an attempt to be proactive regarding the change, the EDA has: 1. Contacted the following entities regarding project partnership and /or advice: • MHFA — Central Region Homeownership Contact. • University of MN. Humphrey Institute Center For Urban and Regional Affairs (CURA) regarding Community Assistantship Program (CAP) and economic impact study. • Stearns County HRA. • DEED: Redevelopment grant and SCDP. • Central Minnesota Community Land Trust (Central Minnesota Housing Partnership). 2. Held discussion on and pursued the following: • Commissioning of a study by the SCSU Economic Development Center to determine the economic impact of the presence of CSB /SJU in St. Joseph and the potential economic impact regarding the residency requirement change. The study is to be completed shortly. • What organization or entity should spearhead efforts to capitalize on conversions of rental units. The City Council has directed the EDA spearhead such an effort. • The EDA has created a technical inventory or student rental units and potential conversion options. The inventory and potential conversion options are available for use in on -going discussions with rental property owners. • The EDA met with rental property owners to gain input on the SCSU study. As a result of the meeting, several landlords /owners have indicated interest in being part of an organized effort to investigate transitioning of uses from rental to some other defined use. ■ Resources for conversion of uses. Financial assistance: DEED Redevelopment Grant Program, DEED Small Cities Development Program Grant, MHFA programs, low- interest energy loans through Department of Commerce, federal Troubled Asset Recovery Program (TARP) foreclosure funds. Other ideas include Investigating the potential to establish a program where college /university assist with down payments and /or provides staff bonuses for moving into student rentals vacated as a result of residency change. The Economic Impact of the CollVe of St. Benedict St fohn's University on the City of St Joseph and Collegeville Township City of St. Joseph I EDA Annual Report - 2009 16 ST. JOSEPH EDA: ANNUAL REPORT 2009 ADDITIONAL PROJECTS: The St. Joseph EDA actively pursued other projects during 2009. Preparation /Maintenance of Information for Distribution to Development Leads The EDA created and distributed information to development leads as requested throughout the year. The information includes a summary of development activity based on City data and commercial /industrial sales based on data from the Stearns County Assessor's Office, word of mouth, and real estate professionals. All data reflected is part of the public record. The information is available on the City website. A summary of sample information created follows and includes: 1. A summary of current residential development activity, phasing and resulting increases in population. 2. A summary of historical commercial development activity. 3. A summary of residential building permit information from 2000 to 2009. 4. A summary of sales of vacant commercial acreage. 5. A summary of sales of commercial facilities. 6. A summary of sales of vacant industrial acreage and industrial facilities. 7. Pictures, contact information, and associated information related to commercial and industrial land, lease space, and buildings available for sale. Preparation of Inventory of Available Commercial and Industrial Land and Buildinsas for Sale or Lease. The EDA has maintained a database of information regarding available commercial and industrial properties (for sale or lease). The database contains GIS information that is available with overlays of existing urban facilities /infrastructure, orthophotos, topography, soil types, wetlands and more. The data is tied to Stearns County's GIS database and includes information such as names of property owners, property identification numbers, estimated market values, property addresses and more. The EDA file includes electronic copies of: 1. Vacant commercial and industrial parcels available for sale within the community. 2. Commercial and industrial facilities available for sale within the community. 3. Commercial and industrial facilities for lease within the community. 4. A parcel by parcel inventory/examination of all properties within the B -1 Downtown Commercial District zoning classification. Website Desisan. Maintenance. and Information The EDA maintains a significant resource through the City of St. Joseph website at www.citvofstioseph.com. New this year are updated profiles, an entire page devoted to business information, and active commercial and industrial real estate resources. City of St. Joseph I EDA Annual Report - 2009 17 ST. JOSEPH EDA: ANNUAL REPORT 2009 Promotion /Offering of Financial Incentives Available The EDA continues to offer the following incentives to qualified applicants. Tax Increment Financing MDG reviewed TIF eligibility requirements with three prospects in 2009. Although no formal applications for the use of tax increment financing were filed in 2009, three inquiries regarding proposed use of redevelopment TIF in rehabilitating underutilized parcels within the Downtown were received /facilitated and two inquiries regarding the use of economic development TIF were investigated /explored. Tax Abatement EDA staff reviewed tax abatement as an incentive with several business prospects this year. Like TIF, tax abatement is a tool, which allows the City /EDA to reimburse the company a portion of property taxes, which are generated within a specified period of time. The difference between TIF and tax abatement is that with tax abatement the County and /or school district have an option to participate (with TIF participation is mandatory). The amount of the tax abatement available depends on a number of factors, including, but not limited to the financial need of the company and participation by County and school entities. The term of tax abatement is up to twenty years depending on a number of variables. The City authorized tax abatement for a superstore project in 2009. Revolving Loan Fund The revolving loan fund, established in 2002 through principal and interest payments from a MIF grantfloan have been building the fund, which has a current balance of approximately $30,000 and was recently reduced by $24,000 due to a loan made to a downtown business through the "Let's Go Downtown" effort. The EDA is in active discussions with two other business contacts regarding formal application for RLF assistance. Minnesota Community Capital Foundation The City of St. Joseph /EDA has access to the Minnesota Community Capital Foundation (MCCF) through Stearns Electric and Great River Energy. Throughout the year EDA staff have distributed information to several development prospects regarding the fund. Through the MCCF Great River Energy is able to offer up to $1,000,000 to qualified projects for a variety of uses (including working capital) on reoccurring basis. Development leads have not been interested in the MCCF perhaps due to the absence of interest savings. St. Joseph Business District Facade Architectural Design Grant Program The EDA/City Council created this grant program in 2007. Requests from two business owners were processed in 2009 (approved) with a third pending approval provided requested information is submitted. In addition, three BFA reimbursement grants were processed in 2009. The current program provides a matching grant for actual design costs, up to $1,000 per property address, to commercial property owners and /or merchants planning exterior building and landscape improvements. Implementation of the BFA pilot program has illustrated a need to fund not only architectural drafting but also actual construction. The $1,000 grant was sufficient to entice business owners and has since been expanded to provide for the use of funds to include actual construction would improve the program incentive. Bioscience Zone Acreage St. Joseph has been allocated bioscience incentive program acreage through the Minnesota Department of Employment and Economic Development. Information regarding the program is available on the City website. City of St. Joseph I EDA Annual Report - 2009 18 ST. JOSEPH EDA: ANNUAL REPORT 2009 PROGRESS REPORT - GOALS FOR 2009: Following were EDA goals for 2009 with updates on progress toward goals and plans for 2009. 1. Proactive participation with the Planning Commission, Park Board and City Council in preparing for the County's construction of the CSAH 2 to CSAH 3 roadway segment in 2010. Proactive participation lead by the EDA may include, but is not limited to, discussions of the timing of extension of collector roadways and municipal utilities for servicing future commercial /industrial areas within the general area of the new roadway. PROGRESS: This item was discussed at a City Council retreat in February 2009 as it relates to stimulating the local economy during the recession. The City Council decided streetscaping and trail installation adjacent to new CSAH 2 was not a good fit at this time since it would be reviewed as new development occurs. The concept of proactive utility extension in conjunction with the installation of new CSAH 2 was included in the updated economic development section of the Comprehensive Plan but not within the five year capital improvement plan (CIP) as extension of utilities is expected as developments are planned. A comprehensive sanitary sewer plan was completed in 2009 resulting in identification of the general route for future sewer utilities and potential costs. . 2. Examine how to proactively market St. Joseph opportunities within greater Minnesota. PROGRESS: The following information was added to the City's website. The EDA reviewed and approved the additions: One Stop Business Information Page created and maintained: The 'one stop business information page' provides information, resources, links, and advice covering the following topics: • How to evaluate a business opportunity. • Choosing a business organization. • Creating a business plan. • Licensing and permitting information (federal, state, and local requirements) • Zoning and site plan review information and resources • Available sites in St. Joseph • Technical and financial assistance available through the EDA • Advantages of doing business in St. Joseph • Advantages of doing business in Minnesota The information contained under the "Community Development" heading on the City of St. Joseph website is updated on a consistent basis with several sub -pages completely overhauled in 2009. A Business Recruitment Page features: Information on Bioscience Zone designation, direct email link to EDA Consultant, business climate information, financial /technical assistance available, information on local educational facilities, information on local quality of life amenities, and links to the following: SCAEDP, St. Joseph Chamber, St. Cloud Chamber, Anderson Entrepreneurial Center SCSU, Donald McNeely Entrepreneurial Center (College of St. Benedict), Mn. Department of Employment City of St. Joseph I EDA Annual Report - 2009 19 ST. JOSEPH EDA: ANNUAL REPORT 2009 and Economic Development, a Guide to Starting a Small Business, and Minnesota regional market data. 3. Proactively participate in activities espoused by the St. Cloud Area Economic Development Partnership. PROGRESS: Information on available properties is updateWreviewed quarterly by Strack, please note other parties are able to add listing information re: St Joseph properties as well. EDA Chairperson Wick represents St. Joseph at SCAEDP meetings. 4. Host listening /working sessions with business owners regarding opportunities provided by or available through the EDA. PROGRESS: A Business Builder Breakfast was held in June of 2009 after months of discussion by EDA members regarding a business retention and expansion effort. A meeting with local landlords to gain insightlinput on rental housing occurred in October of 2009. 5. Examine the potential economic impacts of a four -year residency requirement at CSB /SJU and function as information resource regarding economic impact of four -year residency. Work with City leaders and administration to form a study group whose purpose is twofold. First, the study group could establish to the best of their ability factual information regarding a four -year residency requirement and distribute such information to decision makers and the public. In addition the study group would encourage vibrant dialogue and provide a mechanism for sharing information between decision- makers and stakeholders. PROGRESS: A study by the SCSU Economic Development Center and associated discussion regarding this issue has been included at each regular EDA meeting in 2009, with the exception of two meetings. The EDA's CIP request includes $20,000 in 2010 for revitalization, including revitalization of rental areas. 6. Specific goals for 2009: ■ Convert BFA to allow use of funds for construction in addition to architectural services. This has been accomplished. • Economic impact study residency change. This study has been commissioned and is set for completion. ■ Master plan for conversion of rental units by unit. Participation of property owners, PC, CC, and Park Board. This goal is dependent upon conclusions reached in the SCSU study. A group of interested landlords/rental property owners has been populated and will be used to further pursue this goal in the future. ■ Establishment of flower containers & trash receptacles in DT. This is part of a streetscape and landscape plan being designed at this time. The plan is being funded by the EDA with outreach to several service organizations and businesses. Said outreach will again ramp up upon completion /acceptance of the design plan. City of St. Joseph I EDA Annual Report - 2009 20 ST. JOSEPH EDA: ANNUAL REPORT 2009 ■ West entrance streetscape /landscape from 1 -94 to Downtown. The City Council directed the EDA to place a lower priority on this goal. This goal is to be accomplished on a case by case basis as development occurs. ■ Proactive extension of roadway & utilities to new CSAH 2. Right of way acquisition is on- going, construction to start in 2010. On -going discussions with property owners continue. Business retention & expansion visits. The item was discussed at length and modestly pursued in 2009. The 2009 BRE outreach effort started with an update of the 2006 -07 program survey. After discussion at several EDA meetings the thought of EDA members surveying a list of business owners was converted to a "Business Builder Breakfast" event. The goal of the breakfast was to get business owners talking with EDA members in a neutral setting. Postcard invites were mailed to over 100 business owners with only a handful of people attending the meeting. The EDA concluded the event was useful and low attendance was not surprising. One outcome of the breakfast meeting was to post more information on the City's website relating to 'one stop' business information and available properties. It is further noted that in reality business retention /expansion (BRE) occurs on an on -going basis: (1) as leads are initiated, received, followed -up on, and pursued, (2) as available properties/establishments are identified (toured) and promoted; (3) and as technical and /or financial assistance is sought ■ Host a community meeting with business owners. Accomplished as part of the aforementioned work item. ■ Investigate increased signage opportunities. This item will be included in the streetscape and landscape design plan the EDA has commissioned. ■ Secure Project 08 -B. EDA staff continue to pursue this project. Several sites were identified but are dependent on CSAH 2 construction. The project representatives have not made a decision on a future location but continue to prefer a St. Joseph location. This goal is challenged by a lack of industrial land within the City and the delay of construction of CSAH 2. City of St. Joseph I EDA Annual Report - 2009 21 ST. JOSEPH EDA: ANNUAL REPORT 2009 2010 EDA GOALS: The EDA has established the following goals for 2010. 1. Investigate and pursue proactive measures to secure and provide for shovel ready industrial sites and encourage build -out of Parkway Business Center. Background information follows. • Preliminary plat approved, final not approved but could be if someone purchased. • Parkway Business Center consists of four (4) separate parcels as follows: • PID 84533400150 (17.35 ac.) EMV = $260,300 (Nwestern most parcel access from 133). • PID 84533400132 (16.7 ac) EMV = $250,500 (Eastern most large triangular parcel). • PID 84533500030 (17.65 ac) EMV = 24 7, 100 (Swestern most parcel, accessed from 19"' Ave through lot owned by Joe Prom but under C4D (court hearing pending on C4D). • PID 84533400027 (3.26 ac) EMV= $102,600 (Seastern triangle). • Sheriffs Sale four all four parcels at Stearns Co. on March 26, 2009. No buyers. Redemption period expires in March. Outstanding loan amount is $1,035,000 (all four parcels). Total EMV is $860,500. Mortgage is more than the property is worth at this time. • In addition to mortgage the properties are subject to liens for engineering /surveying services provided. Court hearing(s) pending. • 2009 taxes are delinquent on all four properties. • Could compete with industrial /commercial lots developed adj. to new CSAH 2 (according to Stearns Co. ROW has not yet been acquired and a construction start date is unknown). • Potential strategy. EDA provides for development<mprovement of a fraction of the Business Park as a means of inducing development on the remainder of the property and provide shovel ready industrial sites at salable prices. 2. Work with property owner to proceed with St. Joseph Professional Plat. Background information follows. • This property is owned by a single entity and located in the northwest quadrant of the intersection of CSAH 75 and CR 133 (west of Coborns PUD). • Preliminaryffinal plat documents and improvement plans were developed for this four acre parcel in 2008 -09 in conjunction with potential sale of property. The sale dissolved just prior to the public hearing for the plat. The preliminaryffinal plat application has been pending since that time. • Plat approval could erase one impediment for sale of lots on this site. Lots should be marketable since Coborn's has opened. Could be future site of fast food restaurant. • Potential strategy: plat finalization assistance from EDA and marketing partnership with EDA. 3. Continue to work with property owners seeking development of land adjacent to proposed CSAH 2 including, but not limited to, seeking federal EDA funds to install utilities in said areas. Background information follows: County Assistant Engineer notes new CSAH 2 ROW has not been acquired, but conversations are underway. Construction timeline won't be established until ROW acquired. Appears construction likely delayed another year Extension of utilities is going to be expensive. This affects timing of development and resulting lot prices. Development concept received for one site. City of St. Joseph I EDA Annual Report - 2009 22 ST. JOSEPH EDA: ANNUAL REPORT 2009 Willing property owners. Potential strategy: Availability of water from extension of system to water treatment plant will likely reduce cost of development adjacent to areas near 1 -94. This fact could be highlighted and promoted to property owners. Potential strategy: Apply for federal EDA funds to install improvements in conjunction with CSAH 2 construction since project likely delayed to 2011. 4. Host at least two events for business owners (similar to the Business Builder Breakfast held in 2009). Background information follows. Last year's Business Builder Breakfast was viewed as a success. More such events were encouraged. Potential strategy: could host luncheon event in February to highlight local legislative initiatives since the Mn. Leg. Session starts in February, could also highlight Local Blend's use of BFA and RLF programs. 5. Implement capital improvement projects. 6. Continue to market available commercial and industrial lots, land, lease space, buildings, etc. 7. Continue to respond to inquiries and continue proactive follow up of viable leads /prospects. 8. Continue website development and updates. 9. Continue to pursue revitalization within the Downtown through: • Promotion of the Business Facade Architectural (BFA) Grant Program, • Competition and revealing of the land /streetscape design (includes connecting Wobegon Trail Center to College /Minnesota, west Minnesota to new CSAH 2) plans being completed by Scenic Specialties and fundraising related thereto, and • Collaboration with interested parties. 10. Continue to address rental unit conversion issues resulting from residency requirement changes at the College and University. 11. Continue to implement/administer technical and financial incentive programs. 12. Continue to proactively participate in activities espoused by the St. Cloud Area Economic Development Partnership. City of St. Joseph I EDA Annual Report - 2009 23