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HomeMy WebLinkAbout[06a] Business/BRE Report CITY OF ST. JOSEPH w�%w cityo(stjoseph.com Administrator Date: December 5, 2012 Judy weyrens Memo To: Members of the EDA Mayor City Administrator Weyrens Ri�k s�h�l t� Memo From: Cynthia Smith-Strack& Joanne Foust- MDG, Inc. coUn�il��rs RE: Business Retention and Expansion Program Steve Frank Bob Loso Renee Symanietz gackground. llale wi�k The Business Retention and Expansion Program began in July 2012. The following efforts have been made to obtain input from all businesses: �"�a Initial letter mailed to all businesses . Doug Danielson ste�e Frank • Chamber email to their membership I.arry Hosch • Post card reminders mailed to all businesses Tom skahe„ • Presentation at a Chamber meeting Dale wick • Phone calls to businesses that did not respond • Mailing of surveys via US Postal Service to those requesting hard copies • Emailing the survey link to businesses requesting this option As of December 5, 2012 we received responses from 57of the 150 businesses surveyed (38%). Enclosed is a summary report of the responses from the 2012 Business Retention and Expansion Survey. We have started to contact businesses which indicated concerns existed as well as mail information to businesses that requested data on the BFA and Low Interest Loan Programs. We will continue to follow-up over the next month. Action. Following review and input, the EDA is asked to accept the 2012 BRE Summary Report. � t� CITY OF ST. JOS�PH ���-w.ciryo(stjoscph.com Business Retention & Ex ansion Pro ram p g Summa Re ort �Y p St. Joseph Economic Development Authority and the St. Joseph Chamber of Commerce August 1, 2012— December 5, 2012 � .- �'�', PurposelObjectives # Business The St. Joseph EDA and Chamber of Year Establishments #Jobs Commerce recognize the impact businesses 2012* 126 1,672 have on the local economy. National statistics 2011 122 1,723 show that in one year a small business 2010 128 1,705 employing 15 individuals on average: 2009 127 1,577 ✓ Generates $430,000 in payroll for the local 2008 130 1,528 com m u n ity *2012 First Quarter Statistics ✓ Pays $45,000 in property taxes Source:MN Department of Empioyment&Econ.Dev. ✓ Makes $15,000 in charitable donations to local causes. The St. Joseph EDA and Chamber of Source: Canada, Eric, Beyond the Basics: Advanced Commerce developed a business IISt fOf th8 Business Retention.Wheaton:Blane,Canada Ltd.2003. BRE PrOgr2m whiCh inCluded home based The EDA and Chamber of Commerce are aware businesses. The BRE list included 150 there are three primary sources of job growth in businesses, all of which were contacted. a city: Fifty-seven (57) of the 150 businesses participated in the survey, resulting in a 38% ✓ Incoming new business (11%) response rate. ✓ Existing business expansions (80%): and ✓ Start-up operations (9%) Source:Blane,Canada,Ltd."Beyond the Basics—Advanced BRE Process and Timeline BusinessRetention° The EDA and Chamber of Commerce conducted the BRE Program through an on-line survey. Realizing the importance of retaining the Initial letters were sent to businesses informing businesses in the Community and fostering them of the program and its purpose. Follow-up future job growth, the EDA and Chamber worked post cards were mailed, emails to Chamber cooperatively to complete the 2012 BRE members and follow-up phone calls and the Program. The BRE Survey was created with the mailing or emailing of surveys to businesses that following objectives: had not responded. The Chamber of Commerce provided a $50 incentive as a part of a drawing ✓ To provide the EDA and Chamber of to encourage participation. The survey was Commerce with information on the local conducted between August, 2012 and business climate. December, 2012. ✓ To obtain information which would allow the EDA to assist businesses that may be in Survey Contents need of expansion or need assistance to The BRE Survey included 35 Questions relating remain viable. to: ✓ To learn about local businesses and their ■ General Business Contact Information future plans. ■ Business Sector ✓ To obtain input from business people on ■ Ownership/leasing of facilities EDA programs and priorities. ■ Longevity in the City ✓ To stay in touch with our local business • Why they located here leaders. • MarkeUterritory ■ Positive aspects and challenges to Businesses in St. Joseph doing business here The number of businesses and employment • Infrastructure concerns opportunities in St. Joseph have remained • Sales trends relatively stable over the past five years. The ■ Business recruitment following table reports the number of business • Business plans-expansion or relocation establishments and jobs, as reported by the MN ■ Employment - #s, payroll, commuting Department of Employment and Economic patterns Development. ■ Hours of operation • Chamber membership ■ Financial Programs �� I Page1of10 ■ Branding ■ EDA Priorities ■ Other comments ■Retail Business Several Questions were included in the survey ■Service to assist in identifying opportunities as well as Industry "red flags" OManufacturing/ Warehouse Opportunities included: I'� aEducation • Other businesses that would be beneficial to have(suppliers, etc.) • Current facilit not ade uate to handle ■Leisureand y q Hospitality future growth • Projected employment growth ■GovernmenUP Interest in the FaCade Architectural ublic • Design Matching Grant ■Non-profit Red Flags questions related to: • Decreased employment projections -- • Decreased sales over the past three years Just over '/z of the business participants own a • Plans to relocate commercial space, with nearly / leasing a Concerns with infrastructure commercial space. A total of 16% own an � industrial facility, seven percent are home-based Use of Information businesses and two percent lease an industrial space. Follow-up to BRE questions is essential including responses to any requests for gusiness Information.Please select the one that best describes information inCluding: your business setting: • Available Sites Answer Options Response Response Count Financial programs Percent • Concerns with city infrastructure, etc. Home-based business 7.3% 4 • Plans to reloCate Own a commercial space 50.9% 28 • Plans to expand Lease a commercial space 23.6% 13 Own an industrial building 16.4% 9 Summary of BRE Survey Results Lease an industrial space 1.8% 1 Following is a summary of the survey results. other(please specify) 2 answered question 55 Linking Business Web to City's Web Site Fifty of the businesses reported they have skipped question 2 websites. Of these 35 or 70% requested the city link their businesses web site to the City's business directory. Longevity in the Community Twenty-one (21) of the fifty-seven (57) or over Type of Business 1/3 of the businesses reported they have been The survey participants represented a variety of in St. Joseph 25 years or more. Businesses industry sectors, with the largest group from the Which located in the community over the past 0 service industry (51%), followed by retail to 5 years, 6 to 10 years, 11 to 15 years and 16 businesses (26%), manufacturing and to 20 years were also well represented. warehousing (10.5%), leisure and hospitality (9%) and non-profits(3.5%). �, Page 2 of 10 �� G How many years has your business i Most Positive Aspects to having a Business been located in St. Joseph? ' in St. Joseph 0 0-5 years, Businesses were asked the most positive ■ 25+years, o aspects of operating a business in the 36.8% 24.6/o � � community. The number one response was the ! proximity to St. Cloud, followed by the loyal customer base. ■ 6-10 years, 19.3% 0 16-20 What are the three(3)most positive D 11-15 aspects of having a business in St. years, Jose h? 7.0% years, P 12.3% 90.0% ----- - - 80.0% 70.0°/a Reason for Locating in St. Joseph so.o% Businesses were asked why they chose to locate in St. 50.Oo% Jose h. The to three res onses included: roximit to 40.Oao P P P P Y 30.0/o their home,a market need,and affordable land or building. 20.0% 10.0% _ _-- --- __ -- -- 0.0% , �� �: What was your primary reason for � o � .� � � �, � °' locating your business in St. Joseph? �X a � o o �� °'o @ � � a� O O p 3 V � T p -p � � fD °-U �� � o ° � o � U � a Qm � -o m o � � Z wo E � Qm `�°, .@ O � w m _ J U "' � O J Market Proximity _ - need, to home., Challenges to Operating a Business in St. 32.0% 34.0% Joseph When asked what the greatest challenges are to ordable operating a business, only 60% responded with lan uildi Location a challenge. The top responses were the ng,18. o (proximity unstable economy and competition with to metro), businesses in the St. Cloud area. 16.0% What are the greatest challenges to operating a business in Markets served by St. Joseph Businesses St.Joseph? o Answer0 tions Response Response Of those responding, 61 /o reported that the p Percent Count primary market they serve is local. The following Competition with businesses in St. 52.9% �8 chart illustrates the other responses. Cloud and su«ounding areas Unstable economy 58.8% 20 What market does your business primarily serve? Lack of affordable housing for work 5 9% 2 force Answer Options Response Response Mobility of the workforce 2.9% 1 Percent Count Other(please specify) 23 Local 61.4% 35 answered question 34 skipped question 23 State 22.8% 13 Regional(5-State 3 5% 2 Other challenges noted included: high property Area) taxes (4), getting local support and customer National 10.5% 6 loyalty, making people aware they are here, International 1.8% 1 continued annual business overhead increases, answered question 57 banking, trash in parking lots, limited signage, Page 3 of 10 ,, _� � -�� getting people to slow down, perception that ' government restricts business growth, � inconsistency in the application of ordinances, I , the housing market and finding quality people. ' Infrastructure/Business Concerns Businesses were asked if they have any concerns with infrastructure, etc. The top concerns noted were taxes and fees followed by ■Increased�Been stable�Decreased roadways within the city and broadband access. __ _ _ _.____._ _ Employment A majority of the businesses that responded Community Infrastructure- Please currently have one to five employees. Four check any/all that you have concerns businesses reported over 30 employees. with: Businesses are projecting increases in employment over the next three years with five 80.0% businesses projecting they will have over 30 70.0% � employees and one projecting over 100 i employees. 60.0% 50.0% '� How many full-time equivalent employees currently 40.0% work at your St.Joseph location and how many employees do you project in three years? 30.0% � Answer Current Projected Res onse 20.0/a . Em lo ment P p Y a Options Employment Count 10.0/a in 3 ears Y 0.0% 1-5 30 20 30 � � � ` ^ (n T >. tn tn � � � � � = = 3 3 � X 6-10 3 6 7 � � � w � � @ � � � � ~ 11-20 13 5 13 ° t °- m m Q a@ 0 21-30 4 9 10 o '3 'c c� � � m '� � � T � � � � �, 31-40 2 2 3 � � m J m 41-50 2 1 2 N � 51-75 0 1 1 � 76-100 0 0 0 � 101-200 0 1 1 201-300 0 0 0 Other comments included the desire to not have 301+ 0 0 0 a post office box, the re-routing of County Road answered question 54 2, signage, the need for a sidewalk along 2�d skipped question 3 Ave NW and a paved alley, the lack of sanitary sewer and water along the new County Road 2, payroll the lack of "Shovel Ready" business property gusinesses were asked to share their annual and a east-west transportation corridor and payroll in St. Joseph. Four businesses reported some city ordinances. annual payroll in excess of $1 million. Three SaleS HIStOry reported an annual payroll between $500,000 and $1 million. A majority pay under $500,000 Over 40% of businesses report their sales have per year. A total of 28% of the businesses chose increased over the past three years, with one not to respond to this question. third (1/3) reporting stable sales. ��L/ Page 4 of 10 � / Are your current facilites adequate? 17% �Yes 23% o ■N o 60/o A$0-$100,000 per year ❑Uncertain ■$101,000-$500,000 per year ❑$500,001-$1 million per year ❑Over$1 miliion per year Of those indicating space is inadequate the following reasons were provided: • I can't grow anymore without moving. Not sure if I will go Where Employees Live bigger. Businesses were asked what percent of their • We will require better parking as we expand and hantlicap employees live locally, or within a five mile parking! radius of St. Joseph. All businesses reported • Since the"county road 75 overlay district corridors"take- they have at �east one local employee. The over of most the businesses land along the 75 corridor it percent of employees who live locally varied very much limits expansion anywhere along that stretch...plus greatly by business. The category question most are afraid of additional tax&fee increases. Most of asked respondents how many of their us,as we have all met as a group before,were not employees lived within five miles of St. Joseph. guaranteed by our attorneys,we could push&receive some kind of tax cretlit or relief,so we canned the idea. • We would like to expand the size of our building by acquiring the adjacent building to either side. The likelihood of this is small, however. • Building is small but we would not be looking for another location as it is important that we remain and pay rent for that spot. • The expense to build a functional building on this site would be prohibitive with demolition and current codes. • We are outgrowing the space and our building has a very high taxes. • Based on location and tax structure location becoming less viable. • We will need to expand if our sales even grow by 10-15%, o0°/o ■1-15% ❑16-30% ❑31-45% however we have the additional acreage here to expand. ■46-60% �61-75°/o ■76-90% ❑91-100°/o • We will be needing another building in the near future. • I am outgrowing my space and it has limitations. If I had funds available I may choose to have a warehouse type setting. Facility Needs and Future Plans . We would love to expantl in the city of St.Joseph,but plans are Businesses were asked if their current facilities to build elsewhere as it will take too long for city to act on are adequate for the future. Nearly 60% expansion plans. Our growth will not wait for the city of St. responded "Yes", 23% uncertain and 17% or ten Joseph and the timeliness of its planning process. (10) businesses responding "No". Several thousand foot facility,with high-end salary positions for production and sales support. (Anonymous submittal) • Want to expand to include training facilities. • Certain city by-laws inhibit the bar industry from competing with the surrounding communities,as such we lose a substantial customer bases to them. .-, ,- Page 5 of 10 `7`-' • Need more warehouse space for our finish product. It would • �Ne would like to see more sit-down eating give us more working space in the factory part for more workers. establishments-not fast food.We have a lot of ineetings • Not enough warehouse space. in our office and would like to be able to take them out to eat without having to travel to St. Cloud.We are very • Looking at more catering space/perhaps an industrial kitchen or limited to where we can bring them and have lunch and a limited 2ntl location' be done in an hour or two. Relocation within Next Three Years • Additional package and LTL freight carriers who could service the states of North Dakota, South Dakota, and When asked if they plan to relocate in the next Montana. three years, the following responses were RubberlUrethane manufacturers. received: • Non union gear manufacturing. • Pottery studio,jewelry-making shop,food demo type of Expansion Plans:Do you plan to relocate in the next three years? business people could enjoy by watching through a large Answer Options Response Percent Response Count windowed area(taffy pulling or fudge making perhaps), weaving shop with large loom where visitors could add Yes 5.3% 3 their personal touch, live music venues, petting zoo. No 68.4% 39 Types of businesses people would come to as a Uncertain 26.3°/a 15 destination point. • More retail type businesses. One of the three that noted plans to relocate . Any business with employees. was submitted by an anonymous party. One . Bakery. noted during a follow-up call that they may not. Expand industrial business tax base first by annexing They had some frustrations initially. • industrial area in our orderly annexation area(Deutz Recruitment of Other Businesses Business Park). The businesses and tax base already Businesses were asked what other types of exists and that area is no longer township by nature. The businesses they would like to see in St. Joseph. return of investment for infrastructure would be much quicker in this area than providing infrastructure for Following are the responses: possible new businesses on the new CSAH2/CSAH 3 • Auto parts store bypass. • Healthy grab and go food manufacturers. • A larger choice of eating places, Different and unique • Any electrical,plumbing or HVAC wholesaler for me.Any shops and stores.Stores that you cannot fine in nearby manufacturing or industrial business.Any type of towns. Stores that sell items you cannot fintl just business would benefit the entire community. anywhere. A decent music store, hand crafted items . Any industry that would bring more people to our American made. Any American made products. More community would be beneficial. choice of motels. First Fuel Bank!!!! . A hotel with a water park so people can stay in St.Joe. I • CBB/SJU retail,tlowntown with bookstore items,clothing, know St. Cloud is working to build an aquatics center. I bakery items,etc. think we could beat them to the punch and either get a • Large assembly manufacturer(New Flyer/Park community center that has one-or a hotel. St.Joe has Industries/Geringhoffl the potential to be a quaint/trendy town that feeds off of • Manufacturing plants.We don't need any more groceries the St. Cloud area. Until now there have not been any or convenience stores. drive thru restaurants-this will be nice to have. When rolling. • More retail downtown,a motlerate scale hotel for parents of students to stay at. Hours of Operation • Upscale salons, more specialized retail stores focused on gusinesses were asked to report their hours of college style living ,but is a hard sell with big box stores a operation including days of the week they are couple miles away...less fast food. open, opening and closing time. Times varied • Office supply,copy/print,shipping,etc. greatly, but a majority reported opening at either • Can we leverage the cultural/natural environmenUcollege 7 a.m. or 8 a.m. and closing at 5 p.m or 6 p.m. /art/cottage industry scene to attract additional white Several reported they are open until 8 p.m week collarjobs? nights. A total of 62% of the businesses reported they are closed on Sunday and 43% reported they are closed on Saturday. �-� Page 6 of 10 _��C" Chamber of Commerce Membership • Convenient Approximately 55% of the businesses reported • Good workforce they are members of the Chamber of . Artisan Commerce. Of those reporting they are not members, 11 or 46% of the non-members • Unique requested information on the Chamber and • Small-town atmosphere membership. . Hometown ____ —__ _ • Preserving the past,growing for the future Are you a member of the Chamber of • Friendly neighbors Commerce? • Small town flavor with Big town opportunities • Educatetl • Growing community • Friendly ,. ,-No:,�: . Frientlly � 45.3% Yes, . Vibrant 54.7% • Scenic • Friendly people gather • Unique • Dedicated Employees Requests for Information on EDA Financing • Public cultural events on campus Programs • C�ean The EDA asked businesses if they are • Easy...friendly...shopping interested in information on the Business . Community FaCade Architecture Grant Program (BFA) . Small and/or the low interest loan program. Eleven Growing (11) businesses requested information on the � BFA program and ten (10) requested information • Loyalty on the low interest loan program. • Help direct traffic to the downtown area • Gateway to Avon Hills Branding • Big small town The survey asked businesses for input on the • Growing future branding of St. Joseph. Thirty (30) . Benefits of being out of the big cities businesses provided the following positive Progressive community phrases to be incorporated into a branding • Progressive process: ' • Friendly/Neighborly-Good people,good life • Working hard together • Growing • Welcoming • Concerned,caring,community • Loyal customers • Hartl working • Walking distance to restaurant,grocery store • Quaint and coffee shop • Active • Safe • Flourishing • Big box products at little box prices. St.Joseph • Central has it all. . Getting better everyday • Locally owned • Open • Friendly • Hard Workers • Destination • Neighborly,interactive,small town • Community • Proximity to the Twin Cities • Promote downtown • Statewide shopping..smack dab in the mitldle • College Town of MN • Where it's at • Family town Page 7 of 10 � � • Diverse • Work with the existing businesses as loosing 2 or 3 • Progress businesses to gain 1 is going backwards... (as in the • Remove old homes in the business district case of Loso's store,the St.Joseph pharmacy&I That's the place believe a liquor store vs. Coborns • Modern • City should purchase products locaily if available. • Proximity to St. Cloud • We need more retail downtown. Or more services. Shop local The BIKE PATH MUST have a clear and un-trafficked • Inviting path to downtown and St Ben's. • Stop Saint Bens and or Saint John's from running tax • Walk-ability to numerous amenities paying businesses out of business.They need to pay • Friendly their share when it comes to the use of the city • Small Town feel facilities/maintenance of the roads/fire and police • A little bit of heaven on earth protection.They should not be tax exempt when it • Academic comes to restaurants/rentals/stores etc. I think with the addition of a few new businesses downtown we are EDA Priorities headed in the right tlirection. Follow thru with some of Businesses were asked to rank the following the ideas from the recent committees for"fixing up" projects on a scale of 1 to 10 with 10 being the downtown i.e. new sidewalk/pathways/lighting/sitting areas/a new facelifU etc. most important priority. The top priority Keep it going. Doing well-get folks to downtown from identified by businesses was business retention � Wobegon Trail. and expansion. The lowest ranking project was the development of a water feature in the • More specialized retail space,bike shops,athletic gear downtown. store promoting local colleges, ice cream parlor,artistic galleries photo,paint,sculpture&pottery. Following is a ranking of each project: • Determine what sets St.Joseph apart from other communities around St.Cloud. Embrace being a 7.54 Retention&expansion of existing businesses University community instead of resisting or trying 6.76 Industrial/manufacturing recruitment other go a different direction. 6.71 Retail/commercial recruitment • City support of St.Joseph businesses. 6.29 Downtown master planning • Whatever you do don't raise our property tax,we pay 5.1 Downtown parking plan enough.Work with what you have, not what you wish 4.88 Purchase commercial buildings and prepare sites you had.That will drive business owners away and for business development or open space or shrink your tax base. parking • Make this type of input available as a standing survey 4.22 Install trail/sidewalks and pedestrian amenities to right from the city website,to hear from potential link areas to the downtown business people interested in this city as well. 3.69 Purchase rental houses in downtown and • I have been very happy with the changes in attitude, demolish the business friendly atmosphere of the Mayor and City 2.94 Install a water feature in downtown Council. • Don't tax your businesses out of business. • Create St.Joseph as a destination point by Other Comments and Suggestions encouraging small businesses with a variety of"fun" • Help existing businesses survive for now. elements both things to do and things to see.Also, Add parking capitalize on the Wobegon Trail by encouraging like- No more low income housing minded businesses/vendors either along the trail or Keep city clean&nice with new buildings very nearby for tourists to enjoy(such as Safe to travel trails to Lake Wobegon Trail from entertainment/novelty shops;bike repair&rental;cross � country ski&rollerblade rental).The EDA antl beginning of town to end. Sidewalk to farmers market. Chamber need to partner with each other to hire staff • Keep the city safe,clean,and attractive to families. to run the Wobegon Trail Center like a tourism facility We have certain advantages over the Twin Cities (volunteers are not the answer)with set hours(needs where a business down there could be successful here knowledgeable/enthusiastic person promoting all St. and get a better quality of life for their workforce. Joseph has to offer). Page 8 of 10 3�' �� • Allow fresh ideas to be used in expanding the climate, allow the business owners to incorporate their ideas in making St.Joseph an attractive place to come and visit. • Stop the emphasis on tlowntown. • Lower taxes by building the base on commercial properties by focusing efforts of business recruitment to the HWY 75 corridor. • Work to make the Orderly Annexation Agreement with the Township more favorable to the city(similar to the Waite Park/St Joe Township agreement)in order that the city can more easily annex areas whose characteristics are no longer"rural"in nature(industrial park). • This is a great 1st step for the EDA to better know existing businesses in the city. • There is opportunity for"Big Box" retail on the new CSAH 2 to CSAH 3 road that should be built soon if the city moves to annex the area and install sewer/water. I have talked to Township officials who have stated that the city has made no move to do so. If that is the case, I am not sure why the city has plans to spend close to a million dollars on a trail system along the new route using Sales Tax Funding.That money might be better spent on improving areas within the city limits. If the city does plan to annex the area,now would be the time to put in sewer/water instead of tearing up new roads or trails in the near future. • Lower property taxes. • Community involvement • St.Joseph is lacking in creating its own identity- improvements such as the Lofts and St. Ben's new building are creating a nice look and feel to the city. I think the remaining open spaces and commercial spots should be developed so they become more of a campus style look or feel.Think TY(beanie babies) and Google headquarters. St.Joe has the opportunity to create pods of buildings that could go beyond the look of a metal shed or strip mall. I do not know how to further encourage this type of building-but we need something that makes us unique.Also-while being in a small town has a nice feel...small minded-ness and the "gossip nature of folks" are not good for local business...new and existing. I think by having industrial business and places like McDonalds, Coborns,CMCU are excellent because they bring in business and provide a ton of tax revenue. LeYs find more of them so we can all benefit. Having the new school down the road is great—I think the population of this area would increase if there would be a high school too. A bigger population should equal more folks spending money locally. Summary prepared by Municipal Development Group, Inc. December 12, 2012 Page 9 oi 10 .J (!