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HomeMy WebLinkAbout02 16 10 EDA meeting minutesO~ PR% U x ~ESO'SQ' 4646 Dakota Street S.E. Prior Lake, MN 55372-1714 Economic Development Authority Meeting Minutes February 16, 2010 ECONOMIC DEVELOPMENT AUTHORITY MEETING MINUTES CALL TO ORDER The meeting was called to order by President Millar at 6:05 p.m. Present were Commissioners Hedberg, Keeney, Millar and Myser, Executive Director Boyles, Legal Counsel Pace, Assistant Treasurer Erickson and Secretary Green. Commissioner Erickson was absent. APPOINTMENT OF OFFICERS Executive Director Boyles explained that EDA bylaws provide for election of officers each year. Noted that the last meeting of the EDA was in 2007 and that it would be appropriate to select officers for 2010. Comments: Millar: Nominated Commissioner Myser for president as he is liaison to the Economic Development Advi- sory Committee and the Downtown Redevelopment Committee. Nominated Commissioner Hedberg as Vice President and Commissioner Erickson as Treasurer. Keeney: Concurs with Millar recommendations. Hedberg: Supports Millar recommendations. Added that he is a co-liaison to the Downtown Redevelop- ment Committee. Myser: Stated he would accept the nomination for president and supports the nominations for the other positions. MOTION BY HEDBERG, SECONDED BY MYSER TO APPROVE RESOLUTION 10.01EDA APPOINTING OFFICERS TO THE ECONOMIC DEVELOPMENT AUTHORITY AS DESCRIBED. VOTE: Ayes by Hedberg, Keeney, Millar and Myser. The motion carried. President Myser assumed leadership of the meeting. APPROVAL OF AGENDA MOTION BY HEDBERG, SECONDED BY MILLAR TO APPROVE THE AGENDA AS PRESENTED. VOTE: Ayes by Hedberg, Keeney, Millar and Myser. The motion carried. APPROVAL OF MINUTES President Myser asked for Counsel Pace's opinion on whether a vote could be called to approve the March 19, 2007, meeting minutes as there was no quorum of members present who were in attendance at that meeting (due to Commissioner Erickson's absence). Pace: Considered that the vote would be two in favor and two abstentions so the vote could not pass. Myser: Suggested that approval of the March 19, 2007, meeting minutes be deferred to the next meeting. MOTION BY HEDBERG, SECONDED BY MILLAR TO DEFER APPROVAL OF THE MARCH 19, 2007, MEETING MINUTES UNTIL COMMISSION ERICKSON, HEDBERG AND MILLAR ARE ALL IN ATTENDANCE. VOTE: Ayes by Hedberg, Keeney, Millar and Myser. The motion carried. www. cityofpriorlake. com Phone 952.447.9800 /Fax 952.447.4245 Economic Development Authority Meeting Minutes February 16, 2010 CONSENT AGENDA Executive Director Boyles reviewed the Consent Agenda. A. Consider Approval of Resolution 10-02EDA Designating a Depository for the Economic Development Authority for 2010-2013. MOTION BY MILLAR, SECONDED BY KEENEY TO APPROVE THE CONSENT AGENDA AS PRESENTED. VOTE: Ayes by Hedberg, Keeney, Millar and Myser. The motion carried. PRESENTATION Powers of the Economic Development Authority Executive Director Boyles commented that the City Council established the Economic Development Au- thority (EDA) in 1989. The Council has elected to be the EDA to minimize time delays and synchronize planning. Stated that Counselor Pace will provide a presentation that describes associated statutes and authorities granted to the EDA. Pace provided a PowerPoint presentation that described the broad authority of an Economic Development Authority. Noted that an enabling resolution was enacted in 1989 and it has been modified since then. The enabling resolution created a Prior Lake EDA with powers of the Housing Authority, the Redevelopment Act, the Housing Finance Act, the Tax Increment Act and all other powers set out by statute or law. Ex- plained that as projects or initiatives are assessed, it may be easier or there may be a financial benefit to do it through the EDA rather than the City. Listed the powers granted through the EDA such as acquiring property, acting as a redevelopment agency, operating public facilities, issuing loans, etc. Commented that financing is typically done with the creation of a TIF (Tax Increment Financing), which is a mechanism where the EDA captures the taxes from the general and special taxing authorities and keeps them to be used to facilitate a project. Described types of districts. Described how monies can be used to analyze economic development needs, promote economic development and conduct public relations campaigns, undertake activities to make land suitable and available for economic development, etc. Noted that the City is not liable for the obligations of the EDA; and that the only limitation on the powers of the EDA of Prior Lake is that it must act consistently with the Comprehensive Plan. Comments: Keeney: Asked for clarity about the City not being liable for EDA debts except for certain types of bonds. Pace: Replied the EDA needs the authority of the City to incur General Obligations Bonds. Hedberg: Asked if it is more common to have Council members serve as EDA, or more common to estab- lish aseparate board. Pace: Replied that EDAs can be structured differently. Explained that an EDA can be three, five or seven members. The members can be some or all of the City Council members. The benefit of having all of the Council members is the ability to act consistently with the goals and objectives of the 2030 Vision and Stra- tegic Plan which provides a "road map." Some might prefer that the EDA not be all Council members in order to invite business or bank officials who are not part of municipal government to be outside resources for the EDA. Hedberg: Indicated he would like future discussion about what the membership of the EDA should be. Millar: Commented that he understands the autonomy of the EDA, but it seems as though the Council controls the EDA. 2 Economic Development Authority Meeting Minutes February 16, 2010 Pace: Stated that the Council defines the powers in the enabling resolution; and can decide that members of the Council are the EDA which provides much control. If the enabling resolution was different, and EDA were not Council members, the Council could have less control. The enabling resolution allowed the Council to retain considerable authority over financial matters. Myser: Clarified that there is nothing to exclude the EDA from including or allowing public input from busi- ness people with expertise in particular areas. Pace: Affirmed stating that the bylaws do not address the kinds of advisory committees or other ways to gain input. Myser: Asked what it means for the EDA to "act as agent of the federal government." Pace: Replied that the EDA could apply to be designated as a free trade zone. Believes Prior Lake is small to be designated as a free trade zone, but that would allow incentives to grow relationships, trading partners, technologies, etc. Keeney: Commented that Prior Lake has a unique situation with the Shakopee Mdewakanton Sioux Community (SMSC) and asked if a trade free zone could be applicable with them. Pace: Responded that it could not, but the SMSC could create an EDA and the EDAs could partner with one another to accomplish things. Myser: Asked for an example of a TIF and why Prior Lake would grant one. Pace: Replied with the example that the 2030 Vision and Strategic Plan has a goal of providing housing quality and diversity and if the EDA felt there was not sufficient housing for seniors, the City could financial- ly assist a project for a senior housing apartment complex to achieve the goal. Eligibility would depend on the BUT FOR test; i.e. the project would be viable but for lack of financial backing. Another example could be an industrial park where the City has parcels of land where a proposed developer was capable of build- ing, but the land had soil issues; BUT FOR the soil problems, the developer could come in and build and TIF monies could be used to correct the soil. Myser: Clarified that the TIF is the accumulated taxes that would have been paid. Pace: Responded that it is money that the property owner is taxed, but the money does not go to the tax- ingdistricts, but rather goes to the City and the City makes payments to the entity. Hedberg: Stated that McKenna Crossing had several million dollars of TIF to meet the objective of having affordable senior housing and their obligation is that for the life of the district, a certain number of apart- ments will be offered at low rent for qualifying seniors. Myser: TIF is a tool available to the EDA to allow competitiveness with other cities who might be offering this tool as well to attract businesses that offer jobs and services in the area. This is just using resources for the purpose ofjump-starting economic development by using the taxes they would have paid. J. Erickson: Commented that conduit debt is not an obligation of the City. That has been received for the Lakefront Plaza district and enough of the tax increment has been retained to make the payments on the debt. A disadvantage to be considered is that the market value or tax capacity for those properties stays off the rolls for the City, school district and county until the end of the district so we do need the approval of the School District and County before approving a tax increment district. Financial Update Assistant Treasurer J. Erickson explained that the EDA financial activity is reported as a blended special revenue fund of the City which had a balance of $98,476 at the end of 2009. Described the existing debt and bond maturity date. Indicated that there are revenue funds created to track economic development grants and to provide seed money for a revolving loan account in order to provide economic incentive for new business expansion. There is also a capital projects fund for the purpose of revitalizing and renewing the appearance of the downtown business district. 3 Economic Development Authority Meeting Minutes February 16, 2010 Comments: Hedberg: Asked what the original sources were for the funds. J. Erickson: Replied there were grants received from federal and state. Hedberg: Asked about the source of the funds in the downtown redevelopment fund. Boyles: Replied it was TIF funds from the downtown area. Millar: Asked if any other grants are being pursued to increase these funds. J. Erickson: Replied that no grants are currently being pursued. Noted that money has been available for revolving loans but no recent requests have been received. Keeney: Clarified that the Downtown Redevelopment Fund is not a loan fund. J. Erickson: Affirmed. Keeney: Commented that the $98,000 of EDA funds are not City funds and it seems a waste not to utilize them. Believes a program should be developed to use the funds. Myser: Asked about the grants received and whether opportunity for more grant funding has disappeared. Boyles: Replied the original funding goes back to early the 1990s when firms such as EM Products estab- lished that they would grow employment by a certain amount and for that consideration the Federal gov- ernmentwould loan them money, and the repayment came back to the City. Indicated he would have to research what the constraints are on the use of the monies. Myser: Affirmed it would be desirable to learn how to put the money to use; and learn if there are ways to grow the funds to pursue our activities. MOTION BY HEDBERG, SECONDED BY MILLAR TO ACCEPT THIS FINANCIAL UPDATE AS PRESENTED. VOTE: Ayes by Hedberg, Keeney, Millar and Myser. The motion carried. PUBLIC HEARING No public hearing was presented. OLD BUSINESS No old business was presented. NEW BUSINESS Consider Approval of a Report to Clarify the Goals and Objectives of the Economic Development Authority. Executive Director Boyles commented that the City no longer has an Economic Development Director position, but it does have the EDA, legal counsel and the Economic Development Advisory Committee (EDAC). Described things to consider such as the number of years since the McComb Study was underta- ken and whether its data is still germane, whether the EDAC should report to the Council or the EDA, whether the goals of the EDA and the 2030 Vision and Strategic Plan are in alignment and achievable, etc. Suggested that McComb could review that study with the EDA to determine whether the recommendations therein should be revised. Comments: Keeney: Asked what mechanism would be used to have the EDAC repork to the EDA rather than the Council. Pace: Replied that bylaws would have to be modified. Commented that the EDAC could report to both the 4 Economic Development Authority Meeting Minutes February 16, 2010 Council and the EDA. Keeney: Commented that there needs to be a mind set to use the tools we have and make the EDAC more aware of the tools and financing that the EDA could bring to the City. Hedberg: Asked about the five business nodes in the Comprehensive Plan commenting that it seems that economic development in Prior Lake has been responsive to particular business interests rather than being strategic in its development. Stated the five nodes referred to speak to having services available to resi- dents which would be community development, but none of them speak to attracting businesses to bringing jobs. Noted there is a SCALE objective of having 50% of the residents in the County having jobs in the County, but that maybe too broad for the City and the City should address having jobs for City residents in the City. Commented that population projections are slowing from the Comprehensive Plan projections and that shift questions the viability of having five nodes scattered around the City and whether the City can afford to support retail development scattered in five places. Questioned whether the types of programs and facilities are in place to attract employers with technical and professional jobs. Believes it is the re- sponsibility of the EDA to see what is achievable and questioned whether having the Coucil members serve as the EDA provides the time and attention to move that forward. Expressed appreciation of the volunteer- ism of the EDAC, and noted there are also important policy and financial decisions to be made. Believes three EDA members should be from the Council and others from the community. Millar: Concurred with many of Hedberg's comments. Expressed concern about business retention ac- knowledging that Gateway is losing its two anchors. Believes the City should be looking more broadly at the CR 21/CR 42 area and that it needs to identify the types of businesses that would be good for the community. Believes it is important to meet with the EDAC and hear what they have to say. Myser: Concurred that more needs to be done for economic development for the City and that will provide services, jobs and additional tax base to put back into investment in the community or lower the burden for residents. Stated he wants to focus on what the City has to offer and create an environment that will attract businesses and position ourselves for growth in the future. Believes there must be a proposal for moving the EDA forward with the resources available and the EDA should look at what the EDAC has on its task list. Commented that a committee focused on bringing businesses to the area should perhaps be separate from a committee focused on retention of existing businesses. Mentioned his conversations with retired people who have offered to be part of some activity as volunteers. Supports review of the McComb Study and the Comprehensive Plan and the impact of the economic downturn. Millar: Commented on the suggestions of adding non-Council people onto EDA noting that membership can include up to seven people. Questioned whether someone from the EDAC should become a member of the EDA. Boyles: Recalled that when the EDA was formed, there were two members from the community. Hedberg: Reiterated that his thoughts are to attract experts from the community and to recognize limits on the time of current Council members. Believes focused attention is needed and it may not be realistic to expect Council members to have more time to focus on EDA. Added that the City is at a stage where as- sumptions and plans. for economic development and downtown redevelopment need to be reexamined and would like to consider an update of the Comprehensive Plan as well. MOTION BY HEDBERG, SECONDED BY MILLAR TO DIRECT THE STAFF TO INVENTORY THE RESOURCES AVAILABLE, REFINE THE 08JECTIVES OF THE EDAC SO INDIVIDUALS IN THE COMMUNITY WITH EXPERTISE IN THE BUSINESS PROMOTION AREA CAN WORK ON PROMOTIONAL ASPECTS AND EDAC MEMBERS WORK ON BUSINESS RETENTION, REVIEW THE MCCOMB STUDY AND LEARN WHETHER IT CAN HELP US, ADDRESS AREAS OF ACCOUNTABILITY AND STRUCTURE SO THEY CAN BE REINFORCING RATHER THAN FRAGMENTING. 5 Economic Development Authority Meeting Minutes February 16, 2010 VOTE: Ayes by Hedberg, Keeney, Millar and Myser. The motion carried. ADJOURNMENT A motion was made by Millar and seconded by Hedberg to adjourn. With all members in favor, the motion carried and the meeting adjourned at 7:25 p.m. ~~ ~~~~-~. Frank yl xecutive Director Charlotte Green, Administrative Assistant 6