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HomeMy WebLinkAbout2018-05-17 HEDC Packet AGENDA CITY OF MAPLEWOOD HOUSING AND ECONOMIC DEVELOPMENT COMMISSION Thursday,May 17, 2018 6:00 P.M. Council Chambers -Maplewood City Hall 1830 County Road B East 1.Call to Order 2.Roll Call 3.Approval of Agenda 4.Approval of Minutes: a.January 18, 2018 5. New Business: a.Update on Agreement between Maplewood Area EDA and Larkin Dance Studio b.2018 Business Engagement Program c.Update on Gladstone Redevelopment d.Recent Business Outreach Events (No Report) 6.Unfinished Business: 7.Visitor Presentations: 8.Commission Presentations: 9.Staff Presentations: a.Development Summary (No Report) 10.Adjourn MINUTES OF THE HOUSING AND ECONOMIC DEVELOPMENT COMMISSION 1830 COUNTY ROAD B EAST, MAPLEWOOD, MINNESOTA JANUARY 18, 2018 6:00 P.M. 1.CALL TO ORDER A meeting of the Commissionwas held in the City Hall Council Chambers and was called to order at 6:05p.m.byChairperson Jenkins. 2.ROLL CALL Commissioners Denis Dupee, CommissionerPresent Brian Finley, CommissionerPresent Mark Jenkins, ChairpersonPresent Jennifer Lewis, CommissionerAbsent Benosi Maduka, Commissioner Present Joy Tkachuck, Vice ChairAbsent Dennis Unger, CommissionerPresent Staff Michael Martin, Planner, Economic Development Coordinator 3.APPROVAL OF AGENDA Chairperson Jenkins requested moving the New Member Introduction from 8. a. to5. a. after the Approval of the Minutes. Chairperson Jenkins moved to approve the agenda as amended. Seconded by CommissionerUnger.Ayes –All The motion passed. 4.APPROVAL OF MINUTES Commissioner Dupeemoved to approve the HEDC minutesfor October 26,2017as submitted. Seconded by CommissionerFinley.Ayes –All The motion passed. 5.COMMISSION PRESENTATIONS a.New Member Introduction (No Report) The newest HEDC Commission member, Denis Dupee introduced himself to the HEDC commission.Mr. Dupee was welcomedto the HEDC Commission. January 18, 2018 1 Housingand Economic Development CommissionMeetingMinutes 6.NEW BUSINESS a.2018 Business Engagement Program i.Economic Development Coordinator, Michael Martin discussed the 2018 Business Retention and Expansion and Engagement Program. ii.Chairperson Jenkins addressed the commission regarding the Business Engagement Program in 2017andthe future of the program in 2018. The HEDC commission feltthe 2017 Business Engagement Program went very well and agreed the 2018 plan should continue along the same lines. b.2040 Comprehensive Plan Update i.Economic Development Coordinator, Michael Martin discussed the 2040 Comprehensive Plan Updateand reviewed the document with the commission. The first open house is January 25, 2018 at Carver Elementary School from 6:30 –8:30 p.m. and the second open house is January 30, 2018at the MCC from 6:30 –8:30 p.m. For more information on the 2040 Comprehensive Plan Update visit www.mapelwoodmn.gov/2040. c.Election of Officers (No Report) i.Economic Development Coordinator, Michael Martin briefly discussed the Election of Chair and Vice Chair positions for 2018. Chairperson Jenkins asked if any commission members wanted to be considered for Chair or Vice Chairposition. The HEDC commission felt comfortable leaving the current Chair and Vice chair positions as is for 2018.Joy Tkachuck was absent but the commission will check with her to make sure she is comfortable continuing to serve as Vice Chair. Commissioner Unger moved to re-elect Chairperson Mark Jenkins andVice Chairperson Joy Tkachuckfor the HEDC for 2018. Seconded by Commissioner Finley.Ayes –All The motion passed. d.Presentation of Annual Report to City Council –February 12, 2018 (No Report) i.Economic Development Coordinator, discussed the presentation of the Annual Report to the City Council. Chairperson Jenkins stated he will present the HEDC Annual Report at the February 12, 2018 city council meeting. e.Recent Business Outreach Events (No Report) i.Economic Development Coordinator, Michael Martin briefly mentionedthe Business Outreach Eventand the commission commented on it. 7.UNFINISHED BUSINESS None. January 18, 2018 2 Housingand Economic Development CommissionMeetingMinutes 8.VISITOR PRESENTATIONS None. 9.STAFF PRESENTATIONS a.Development Summary (No Report) At this time there were no new developmentsto discusssince the last HEDC Meeting. 10.ADJOURNMENT Chairperson Jenkinsadjourned the meeting at 7:05p.m. January 18, 2018 3 Housingand Economic Development CommissionMeetingMinutes MEMORANDUM TO:Melinda Coleman, City Manager FROM:Michael Martin, AICP, Economic Development Coordinator DATE:May 8, 2018 SUBJECT:Update on Agreement between Maplewood Area EDA and Larkin Dance Studio Introduction On the December9, 2013 the Maplewood Area Economic Development Authority approved a $70,000 forgivable commercial reinvestment loantoMolly Larkin Symanietz, of Larkin Dance Studio.This loan assistedLarkin Dance Studio in moving to the site at 1400 East Highway 36 and occupying a previously vacant building. Discussion Theterms of the loan required that $20,000 be paid back to the city via fees and permit costs during the construction process for the site and this requirement was satisfied in 2014. The remaining terms of the loan call for $50,000 of the$70,000 to be forgiven five years after date of final payment. If Larkin does not comply with theterms and conditions of the agreement, Larkin will be required topay back a portion of the loan on a proratedbasis. Larkin’s initial improvements to the site were required to exceed $500,000 in order for 50 percentof the $50,000 (or $25,000) ofthe loanto be forgiven.Improvements to the building have includednew HVAC systems, a new roof on the out building, the exterior of the building being painted with landscaping installed, the parking lot being resurfaced and its drainage issues addressed and a solid cedar fence built along the east property line to provide screening to the neighbors. These improvementswereapproved and verified by the city’sBuilding Official with costs of more than $500,000 meaning $25,000 of the loan has been forgiven. The remaining $25,000 of the forgivable portion of the loanrequires LarkinDance’s to addthe equivalent of at least 4 new FTE jobs in thecommercial building by December 2016and maintaining at least 10 FTE jobs in thecommercial building until December 2018, at wages of at least $12.25 per hour. If thosegoals are both met over the course of that five year period, the remaining $25,000.00 shall beforgiven.Thus far, Larkin has created 4.5new FTE jobs.This satisfiesthe requirements of the agreement. Larkin’s 2017business subsidy report is attached to this report and the 2018report will be due to the city by March 1, 2019. During a site inspection of the site prior to this report it was found the freestanding sign on the site is now displaying the Larkin logo andname and the overall property was found to be very good condition. Recommendation No action required. Attachment 1.Business Subsidy Agreement, December 9, 2013 2.Larkin 2017Annual Report Attachment 1 BUSINESS SUBSIDY AGREEMENT THIS AGREEMENT made this day of December, 2013, by and between the Maplewood Economic Development Authority, a Minnesota public body corporate and politic, 1830 County Road B East, Minnesota 55109(“EDA”) and Larkin Dance Studio, LLC, a Minnesota limited liability company,1400 Highway 36 East, Maplewood, MN 55109, hereinafter referred to as “LarkinDance” and 1400 Highway 36, LLC, a Minnesota limited liability company, 1689 Oakdale Avenue, Suite 102, West St. Paul MN 55118, hereinafter referred to as “Larkin Building Owner” and together Larkin Dance and Larkin Building Owner shall hereinafter collectively be referred to as “Larkin.” RECITALS WHEREAS,the Cityof Maplewood(“City”)has long-desired to improve the function and appearance of its communitythrough economic development, and has invested substantial resources toward that goal; and WHEREAS, the Maplewood City Council establishedthe EDA in July 2011in order to advance these objectives; and WHEREAS, the EDA adopted criteria for awarding business subsidies, pursuant to the Business Subsidies Act, Minn. Stat., Sections 116J.993 to 116J.995,(“Business Subsidy Act”); and WHEREAS,Larkinhas operated its business in Maplewood since 1946; and WHEREAS,Larkinhas indicated it has outgrown its current location but would like to remain in Maplewoodandhas identified 1400 East Highway 36, the Minnesota Granite Building (Granite Building)for potential relocationand expansion;and WHEREAS,to facilitate the expansion, Larkin has proposed rehabilitation of the Granite Building, an outdated vacant commercial buildingthat has sat vacant forseveralyears, at atotal estimated cost for the building purchase and renovation cost of approximately $1.6 million dollars and is seeking a business subsidy (“Business Subsidy”) from EDA in the amount of $70,000to aid in the cost of rehabilitation and redevelopmentof the Granite Building and site; and WHEREAS,Larkinis proposing to purchase the Granite Building, upgrade the HVAC system and mechanicals,repair the parking lot, upgrade the electrical systems, repair and replace roofing, conduct environmental remediation, and remedy additional building issues (“Improvements”) to retrofitand rehabilitatethe existing building for Larkin’s proposed use; and Attachment 1 WH EREAS, it is anticipated that the use in the new commercial building will prevent the loss of at least 6FTEjobs through the business potentially relocating out of the City of Maplewood; create at least 4FTE new jobswithin threeyears at wages of at least $12.25per hour; maintain those 10 FTE jobs in the Cityfor at least two years beyond that;promote private investment in a blightedor economically depressed area;enhance economic development, and potentially increase the property tax base; and WHEREAS,the EDA believes the proposed redevelopment of the Granite Building would be desirable for the City; and WHEREAS,the proposed redevelopment meets all criteria for awarding a Business Subsidy established by the EDA Policy on Business Subsidies anddue to the estimated cost of the proposed redevelopment, the Improvements are financially infeasible without public assistance. NOW THEREFORE,for good and valuable consideration, the receipt of which is acknowledged, and in consideration of the covenants and agreements made herein, Larkinand the EDA hereby agree as follows: AGREEMENT 1.The Business Subsidy is comprised of a partially-forgivable loan in an amount not to exceedseventythousand dollars ($70,000). The partially-forgivable loan shall be due and payable to Larkinin increments or in a lump sum upon receipt by the EDA of invoices for work performed. A note and mortgage will be taken out on the property as security for the payable portion of the Business Subsidy, too wit: fifty thousand dollars ($50,000.00).It is recognized by the parties that twenty thousand ($20,000.00) of the Business Subsidy will be almost immediately paid back to the City as and for public works fees and permits and is thus not necessary to secure,long term.Satisfaction of some or the entiresecuredamount will be determined as performance metrics are realized or default occurs. 2.The public purposes of the Business Subsidy are as follows: a. Promote the economic and commercial redevelopment of the City; b.Preserve the local tax base and improve the general economy and vitality of the City; c. Promote the health, safety and welfare of the residents of the City; Attachment 1 d.Rem ove, prevent or reduce blight, blighting factors or the cause of blight inthe City; e.Attract, retain, rehabilitate and preserve commercial facilities; f.Eliminate or improve structurally substandard buildings; g.Create new jobs in the commercial and retail sector; h.Remove obsolete site layout and design; i.Afford maximum opportunities, consistent with the needs of the City as a whole, for the redevelopment of the area by private enterprise. 3.Within the next year, Larkin will be making improvements to the Granite Building and site in excess of Five Hundred Thousand Dollars ($500,000). 4.The goals for the Business Subsidy are to secure timely development and maintain the Improvements as a commercial building for at least five (5)years. 4.Job and wage goals of the Business Subsidy are to create at least the equivalent of 4new FTE jobs inthe commercial building within the nextthree (3) years, at wages of at least $12.25per hourand maintain at least 10 totalFTE jobs in the commercial building over the following two (2) years, at wages of at least $12.25 per hour. 5.Larkinwill construct the Improvements pursuant to a Site Plan,which will require approval by the Maplewood Building Department and Permittingand InspectionProcess. 6.Larkin, its permitted successors or assigns will continuously operate the newcommercial building for at least five (5)years, except in the event of unforeseeable casualty, in which event, Larkinshall rebuild and reopen as soon as commercially reasonable. For the purpose of this section,“continuously operate,” means that space is leased or available for lease to any person or entity for use in its private trade or business, or occupied by Larkin for use in its trade or business. 7.Larkinshall provide a list of all grantors who provided financial assistance for the project (i.e. Department of Employment and Economic Development, Xcel Energy, etc.). 8.If Larkincomplies with the terms and conditions of this Agreement, fifty thousand ($50,000.00) of the seventy thousand ($70,000.00) of theBusiness Subsidy will be Attachment 1 for given five (5) years after date of final payment for the Business Subsidy. If Larkin does not comply with the terms and conditions of this Agreement, Larkinshall pay back a portion of the Business Subsidy on a prorated basis, based on the portion of the operation period elapsed as of the date of default.Larkin’s initial improvements to the site (that must exceed $500,000and once completed and approved by the City Building Official) shall constitute 50% of the $50,000 (or $25,000) of the forgivable portion of the loan. The remaining $25,000of the forgivable portion of theloan shall be based on Larkin’s addition of the equivalent of at least 4new FTE jobs in the commercial building within the next three (3) years and maintaining at least 10FTE jobs in the commercial building over the following two (2) years, at wages of at least $12.25 per hour.If those goals are both met over the course of that (5) year period, the remaining $25,000.00 shall be forgiven as well. 10.The Parties acknowledge that Larkin shall execute a Note and Mortgage in favor of the City of Maplewood EDA for the forgivable portion of the loan, to wit: $50,000.00, which shall be recorded in at least second-lien position against the property. The parties agree that Larkin shall be entitled toa partial satisfaction of the Note and Mortgage once the first $25,000.00 becomes or is forgiven and or full satisfaction upon the conclusion of the successful completion of the requirements called forth in Paragraph 8regarding loan metrics. 9.Larkinmust submit to the EDA a written report regarding Business Subsidy goals and st results by no later than March 1of each year, commencing March 1, 2014and continuing until the later of the date that the goals are met; or thirty (30) days after expiration of the five-year period; or if the goals are not met, then the date the Business Subsidy is repaid. The report must comply with Section 116J.994 subd. 7 of the Business Subsidy Act, the requirement of which are attached at Exhibit B hereto. The EDA will provide information to Larkinregarding the required forms. If Larkinfails to timely file any report required under this section, the EDA will mail Larkina notice of non- compliancewithin one week after the required filing date. If, after 14 days of the postmarked date of the notice,Larkinfails to provide the required report, Larkinmust pay the EDA a penalty of $100 for each subsequent day until the report is filed. The maximum aggregate penalty payable under this section is $1,000.00. 10.Larkinmust comply with City Code Section ___regarding the payment of prevailing wages for/during construction of the improvements to the Granite Building structure. 11.The parties agree that this Agreement shall be construed pursuant to Minnesota law and any disputes shall be venued in RamseyCounty, Minnesota. MEMORANDUM TO:Melinda Coleman, City Manager FROM:Michael Martin, AICP,Economic Development Coordinator DATE:May 8, 2018 SUBJECT:Business Engagement Program -2018 Introduction Beginning later this spring, the city is once againpartnering with the Saint Paul Area Chamber of Commerce (SPACC) to coordinatea business engagement program for Maplewood. This businessengagement programwas developed using the following principles as a guide to what the program should include: Demonstrate to businesses that the community appreciates their presence Help existing businesses solve immediate problems Increase businesses' ability to compete in regional, national, and global markets Establish a strategic plan for economic development Buildcommunity capacity to sustain growth and development over the long term Discussion Currently, SPACC has identified all of the businesses that will be visited this year and is scheduling the times for all of the visits. This is a change from last year. Instead of the city council and housing and economic development commission being contacted for each individual visit, SPACC will send a communication for all the scheduled visits at one time where members can then select which visits they would like to attend. Like last year, once the visits are complete and results analyzed the SPACC will give a full presentation on the report at the Community Engagement Breakfast in October. If interested the . 2017 report can be found at www.maplewoodmn.gov/EEDD Recommendation No action required. MEMORANDUM TO:Melinda Coleman, City Manager FROM:Michael Martin, Economic Development Coordinator DATE:May 8, 2018 SUBJECT:Update on Gladstone Redevelopment Introduction At the May 17, 2018 housing and economic development commission meeting, staff will providethe commission with an update on several projects and initiatives the department is workingonwithinthe Gladstone Neighborhood. Discussion Gladstone Neighborhood Redevelopment As the redevelopment of the former Maplewood Bowl site continues, staff is looking for ways to continue this effort in other areas of the neighborhood. One of the repeated themes staff has heard from developers isthe site prep costs in this neighborhood are prohibitive and create difficulties in continuing the revitalization of this important neighborhood. As a response to this barrier, in the existing capital improvement plan (CIP) the city council tagged $5.95 million to be used for the acquisition of property for redevelopment. Specific properties will be identified and the City may act as developer or in agreement with a private developer to acquire and demolish existing buildings and property for development in accordance with the approved Gladstone Master Plan and the City's Comprehensive Plan. The CIP has thiswork slated to start in 2018. That is when the funding would be available and staff has begun the process of analyzingproperties and contacting property owners to gauge interest. Moving forward the city will also be using the Economic Development Authority to purchase and sell property within this redevelopment area. At the next HEDC meeting, will walk through the properties the city has purchased in the last year and what areas and strategies are being pursued in 2018. Recommendation No action required.