you you you you hello Burnsville and welcome to our economic development commission meeting for Wednesday May the 5th there may be a DH 2019 and to begin I would like to start with adoption of the agenda looks like we have some housekeeping before we get into updates review of the public improvement fees led by Jessica Cooke with elders thank you for coming review of the land to sell for in turn to interstate Development Corporation economic development strategic plan updates and then a review on a creation of tax increment district number nine any motion to accept the agenda as stated it is moved second and second any room for discussion hearing none we'll put it to a vote all in favor say aye I think that was unanimous all right second approval of the minutes from our last meeting which is January 9 2019 they were included in our packets anyone have any adjustments or anything to bring up can we approve those minutes I'll move it's been moved and seconded all in favor say aye all right anyone opposed didn't think so well that brings us to item number 3 that's our update thank you mr. chair just one update on behalf of the city of Burnsville we would like to thank commissioners churner John and de pau commissioners churner and John are actually coming to the end of their second term so they have spent six years with us and as you know that after two years you need to move on and Commissioner de pau is moving so he will be stepping down also but on behalf of the city we appreciate the time and effort that you given us and wish you nothing but the best thank you it for updates mr. chair okay thank you well then we'll move into a review of a pip which is the public improvement fees in with elders Jessica Cook has stopped by to give us a presentation on that so I'll hand the floor over to you Jessica I'll be ready I'm good evening I'm I'm with elders and I work with Stacy and Jason who were unavailable to be here this evening but I'm happy to be here and we'll try and meet your last meeting go out with the bang nice like every field we like acronyms and so piff is another one that stands for public improvement fees and it came up the idea of using the public improvement piece came up of course in the context of talking about the redevelopment at Burnsville Center in particular but also areas around Burnsville Center and it was something that was in the visioning document that Damon Farber prepared so we wanted to address that so the first thing I wanted to just talk about is what is a pip or a public improving fee it's something that is used in other states because it's not actually authorized under state law here in Minnesota at least not yet and yet looks and feels and smells like a sales tax to the person paying at which is the person buying something out of retail establishment but actually what it is is it's a private fee that's collected by a private entity to be used to benefit that that entity for some sort of public or private use so there's if you had let's let's take a mall as an example and let's take an easier example in Burnsville and say that the MA has one owner that owner would file a covenant against the property whereby any one who owned that property going forward would need to collect a fee that would be established in a designated amount and for ease let's say it's 1% and then every retail lease every least lessee let's see the sore in that property would then be beholden to collect that fee on behalf of the owner of the retail entity and remit it to usually a third-party entity corporation that's tasked with collecting that fee and then using it to pay for improvements so from a user's experience the shopper at the mall they just paid an additional sales tax but it isn't a tax in the sense that it's not imposed by the unit of local government although there is approval of local government for this it's not collected by local local government and most importantly local government isn't determining what it's going to be used for so the way it works is that as I mentioned this ad added to the cost of the goods sold at the retail establishment and I have a couple of examples here on the screen if somebody bought on the left here $43 of shoes and clothing and it was a 1.4 percent public improvement fee they would then pay 60 cents for a total purchase of 43 60 then at least the way it works in Colorado which is the state that uses this the most they would pay a sales tax on all of that so you're paying the sales tax on the fee for a total purchase of 46 87 so and then the the example on the right is just a non-taxable item but it essentially works the same way so then the question is why is this financing mechanism so the other thing I should have mentioned about it is that this revenue of course comes in over time slowly as items are sold at the retail establishment but somebody wants to use it to pay for improvements upfront so in in states where this is a more established mechanism there are lenders that will finance an improvement upfront to be repaid over time by the collection of these fees whether you find a lender in this market that would do that for a untested collection system I think is a question that we would have to explore it the city wanted to to pursue this the other option of course would be that the city could finance the improvement and take the risk of the fee revenue coming in and paid itself back which of course is also not yet authorized under state law so something to consider so why did why did was this recommended I think it was recommended because it was familiar to the planners and it was a tool that they were used to and they weren't as well-versed with the tools that we do already have available in Minnesota so what happens in Colorado is the local government is much more dependent on sales tax than Minnesota local government is pretty property packed tax dependent and you may have heard of Tabor or the taxpayer Bill of Rights that got passed a few years ago in Colorado where it became very difficult for local governments to raise any form of taxes property taxes or sales taxes without a referendum and so it really tied their hands on being able to use taxes for economic development activities because the public improvement fee is not a local sales tax there is the ability for entities to private entities to impose that fee with local government permission and raise revenue without having to have referendum so that's the appeal event in a state like Colorado as a referendum avoidance tool in order to get around the issue that sometimes so what happened before is there might have been an increase in the local sales tax to help a situation like Burnsville Center since that's no longer allowable without a referendum sometimes the city will allow the developer to put the piff in place and then lower their sales tax so that it's a net equal to somebody buying making a purchase there but it's a way of getting revenue to the developer in a legal way so that that's why they're using Colorado and they're also something similar to it is used in Florida and those are the two situations that I'm familiar with I hope this can be interactive so please if you have comments or questions let me know so the revenues that are collected from this tool can be used in other states for public improvements such as streets and sidewalks demolition utilities stormwater improvements they can also be used for private improvements such as architectural upgrades common areas parking facilities etc so in Colorado where this model came from it's a very flexible tool I mentioned some of the drawbacks that we talked about it Ehlers when when we were discussing this idea and I think first and foremost is that it's not permitted under state law at this point in time so it would necessitate special legislation well it could be special legislation specific to Burnsville but that might trigger a statewide conversation about whether it should be generally authorized across the state so it would it would probably be an uphill conversation at the legislature to prove why we would need it in the face of what I would anticipate would be opposition from retailers on this on a statewide level that's a little bit of editorial I say editorializing on on my part yeah so nowhere in the state is this allowed yeah I mentioned that retailers might be opposed to it and that's because you know they're already struggling the brick-and-mortar retailers are struggling with the internet competition and the internet competition not always having to pay sales tax and so this sort of doubles down on that disparity where in addition to the statewide sales tax there would be a local pif that would be charged on the goods and services in their stores so they would put them at a competitive disadvantage specific to Burnsville Center you have the three owners and so there'd have to be coordination there and and you would need to establish who's going to be doing the collection and the enforcement who will be that entity and with the city or the EDC want to step into that role or would you want to do the Colorado model and have more set up some sort of private corporate entity for that purpose another issue that we thought might be a problem as we talked about this is the fact that you have all these existing tenants in the mall and every time they go to print out a receipt you know it has the sales the price and the sales tax on it and now they would have to somehow figure out new software for their system so it would have the price and then the piff and then the sales tax and that could be an expensive burden on those retailers to itemize that there's also nothing in their leases right now that requires to do that so you could have a coming in against the land that there they rent they don't own the land so why does that mechanism to get your lessors I get that right to implement it on behalf of the owners of the mall and would there need to be some lease concessions to do that which sort of defeats the purpose because you're reducing the rental revenue so that's a potential issue that the whole implementation at the retailer level and then what I alluded to before you know we we want something we want cash upfront to make improvements today or in the near future that and then we need to finance those and recover those costs over time and is a public improvement fee a secure enough funding mechanism that somebody would would make a law against that and I think that that's untested about who that would be and what the terms of that loan would be and of course the cheapest financing is is if the local unit of government can provide the financing because of the financing tools you currently have at your disposal this model as used in Colorado that usually uses a private lender and the private cost of funds yeah so who would be in control of the money would it it would be the equity firm that you put together or the firm that you put together to collect the funds is it is it more on the retailer retailers and have the money or to the cities and have the money I think they're you know because you would need special legislation there'd be the ability to craft some of that I think the way it works in Colorado is that they're there it's it's determined the amount and the uses and that gets recorded in the Covenant against the property so it's secured against the property the corporation is basically they earns a fee for managing that and passing that through to the lender and then there would be terms in the loan that would limit what it could have been spent on and recovered from so your accountability mechanisms would be the Covenant against the land the loan agreement the financing agreements and the what that collecting entity what their charges what I don't know as much about is there is approval by the local government entity but I'm not sure how much say the local government entity gets in the use of it and for what period of time but as I said in Minnesota because we've made special legislation you could craft it in such a way that there was more local control would so if if I'm a business owner or the owner of the mall wouldn't it be easier just to charge more rent to thee than to go through this larger cycle of things to make things so I mean I guess that's where my confusion is coming but it evidently something they do so yeah I guess that's my question right I mean if they charge more rent that the retailer has to pay the rent regardless of how much they sell right if it's like a sales tax its sales dependent and the retailer may be able to share some of the cost of that with the customers so from the retailer's perspective they may prefer it as an additional tax even though it puts them as a disadvantage there may be some cost sharing with the customers and if they don't sell as much at least it's not a fixed cost okay see that so one of one of the advantages because we did try and think of some advantages is that it's very flexible and a lot of the tools we do have in Minnesota which I'll talk about in in a minute I really directed towards public costs or narrowly defined private costs and the public improvement fees can art can really be used for anything that's agreed upon upfront as I understand it so what I wanted to talk a little bit about is what some of the alternatives are that we already have available in state statute and I won't go into a lot of detail unless you'd like me to on any of these but I'll give a very brief description so TIFF I think you're all familiar with that's capturing the taxes from the growth in value of a development have you done tax abatement okay so tax abatement is done by the city the county and the school district with separate approvals so that's one of the big differences between tax abatement and tip there are special service districts and special service districts are authorized under state law for a part of your city that is receiving a higher level of service that is then is generally provided to another part of the city and for that higher level of service you can charge a fee so a good example would be you have a downtown you're putting up the lampposts with the decorative banners you're maintaining flowerpots you put in the cobblestone walkways you're street-sweeping every month instead of twice a year so that downtown is getting a higher level of service and you can charge a fee to recover the cost of delivering that higher level of service there is a petition process so the property owners in the area have to petition for that and agree to it so much as they were - piff but that that mechanism is available right now there's bonds there's special assessments which I'm sure you're familiar with and then if your fear going for special legislation you could go for a local sales tax which would be community wide versus focusing on a particular retail district and pitting some of your retail district in your community with a higher fee or tax against other areas of the community so those are all mechanisms that can be used to pay for public improvements and then TIF and tax abatement can also be used for site preparation demolition some parking so it there's small incursions into private improvements there but mostly public public improvements if we're looking for ways to pay for common area improvements within the mall which is essentially private space although it certainly functions as a public space there's private equity and debt there are common area maintenance charges that can be passed through to tenants and there's the lease revenues which is what you had mentioned so part of the trick you know in forming a public-private partnership with the mall owners is to identify those public costs that you can help with that will free up their capital for them to pay for the private cost so that's that's the end of my presentation I was involved in the South Dale redevelopment and I did the TIF district for that so if you have any specific questions about that I'm also happy to answer those I would which tool would you most recommend for us to use in this city center well I think that the I'm just gonna use the word quest I'm not sure the right that's the right word but the the request that you have to the legislature for a TIF district that is that is more flexible than the current TIF flaw is that would be an excellent tool okay it's long-term it's flexible its tried-and-true in terms of getting financing for TIF revenues so I think that's very worthwhile I think you know the Special Service Desk District has some interesting ideas but is is really more towards maybe maintaining the improvements rather than financing the improvements and special assessments are great because they're the most secure from the city's point of view is it's a very low-risk form of financing and what was used for the Southdale project was he just - that was TIF that was right after the recession so there was a special law that allowed TIF to be used for private costs that right now we can't use it for so TIF actually was used for remodeling bathrooms and you know doing some other things like that but it was structured as a loan and so the city provided a loan and then repaid itself from tax increment so I think it took a loan from some funds it had from another TIF district and then use the TIF from the mall to pay itself back so to be clear on that Eric you okay to be clear and then a few questions around that so the the advantage of the public Improvement Fund it allows us to actually allows the developers the owners to actually go in and do improvements to the center for instance that Miss aren't necessarily public when it's Apple mmm and maintained by the public entity which TIF allows for or tax abatement allows for so I understand that but we haven't done in Minnesota so today it's really not a tool the TIF that you just talked about for Southdale and the vehicle to convert it to a loan that tool does no longer exist correct the the ability to use TIF and a converted to a loan exists but the ability the kinds of expenditures that the mall used it for are no longer authorized because that was a window of opportunity that was related to the recession but for example in the south they'll example it could have been structured in a way that the tip was used to they actually shrank their retail footprint in the mall and they tore down some space and so you know the TIF wasn't used for that demolition but it could have been there by freeing up the private funds to pay for the the bathrooms and the lighting and some of the other improvements that the TIF paid for but you're saying that vehicle no longer exists because of some changes right so you know to me it's kind of a math problem how much money do they need to reposition that asset and if TIF accomplishes that there's already some precedence in place I think it's a great tool because they win and the public wins as values created and so forth but if we are saying that that's not enough from a math problem and we need to look at layering something like this public improvement fees is that why that's being discussed that potentially it would be another layer that would allow that opportunity to raise more money than what is needed through to it they could be used together presumably assuming that the special legislation permitted that I don't see why they couldn't yes and so somebody should do that math I'd be curious to see what that math looks like just to see really what it achieves to tiff versus what we think we need to achieve and what that all looks like and then the last question I have and then I'll turn over the mic is it I don't like it when we have special taxes without a sunset and so to me to raise it to come up with a payoff I don't think passing it on to the tenants and higher rent is an answer because ultimately the markets going to get what the market gets and now you just penalize the Burnsville Center compared to other competing products but if the city were to do a tax abatement on top of that for the incrementals essentially the same amount that's being raised to the path then potentially that all kind of makes sense because to the at the end of day the tenants are paying more and the and the consumers not pay anymore but is there can you put a sunset to that so eventually once you raise the funds that that goes away yes I think so yeah I can verify that mm-hmm curious mr. chair if I could sir um just a point of clarification if the special TIF legislation passes and we utilized TIF at the principal center we cannot do tax abatement on top of TIF you cannot do an abatement inside of a TIF district and miss Deena is actually actively working on that either we know what percent it would be covered by TIF would be fully funded if we did get the TIF the way it's currently being positioned with the legislature so that the area covered would be the Burnsville Center proper and then some of the outline properties of what we're asking for north of County Road 42 the right-of-way within that area and the properties I'd touch it as far as that would be the defined area so anything within that area could be eligible for TIF funds of course you know public improvement related about half just to go back a little bit that was analyzed is just another tool in the toolbox not that we saw that there was a gap in funding but it was just an option another tool to potentially use and access so that's part of the reason that was explored further as well so there's a gap in the funding I not that I'm aware of no it's just we're looking at what tools do we have available currently today and then what other options are out there what are other states using so you think the TIF if if it got approved would be adequate for funding this current plan public improvements within the area and there are other options to use to kind of piggyback on that to look at you know are there other grants available are there other loans available it's just that we have multiple tools that we can use and there's not necessarily I wouldn't say there's necessarily a gap however it's basically just addressing the concern we had with not knowing all the tools in our toolbox before and you just presenting these different tools correct other ideas all right yeah any other questions so do we need a decision if we want to promote this piff or if we don't is that kind of what we're looking for ah recommend yes we will be looking for a recommendation from the EDC my personal opinion would be totally against it as a retailer I don't know if you'd know how the support the software works but it's very difficult to even add a sales tax on to something or an individual a city one or County one or whatever he has to go through all these different steps and to add something like this that's not even a sales tax into a software we're talking about major expense for some of these retailers to do that and I just think it would put an unnecessary burden on to retailers in the area it wouldn't be a fair thing to do I I'm not that thrilled with it either mostly because it's a big legal lift we need to get it through state legislature and us Burnsville saying hey this is what we need and there'll be an army of people against that I'm just going and look at quacks like a duck it looks like a duck but it isn't a duck I mean but it's not taxed it's a fee yeah yeah I think all pecans that have been laid out I'll weigh the pros by far and when you include the political spending the political capital on this it just doesn't seem to justify the ends anybody else have come I do like the flexibility though it allows the owner of the property that the TIF does not do but it'd be interesting to see if we can now combine it with another tool that allows the owners to do you come up with some money on top of the TIF to to improve the property itself other than the path that maybe we could explore I'm gonna pushing this out and we're close to tack boy yes but can you layer on to my grants or other types of financing on top of the TIF that's absolutely commissioner okay any other discussion on this so the we're looking for a recommendation whether to or not recommend this going up to the City Council or the City Council utilizing a pit so do I have a motion I would make a motion that we do not recommend using a pip in anywhere in Burnsville for anything okay it sounds very strong very strong any seconds to Commissioner Coppins motion I second it okay any discussion on the motion or second hearing none and I'm gonna put to a vote all in favor say aye any one disapprove eyes happen thank you so much because I think today next we're going to talk about land sale to interstate Development Corporation it looks like we're trying to get a good caribou in at 42 in Newton presenting is our economic development Thank You mr. chair coordinator the land in question is located at County Road 42 in Newton for just kind of geographic perspective it basically sits next to Rose Park which is where the soccer fields are on County Road 42 it is literally a hill and it slopes drastically down towards those soccer fields we have had a sign on the property for at least 10 years having it for sale and as I noted in your backgrounds we've gone through a number of different renditions where we've had maybe some opportunities but they really haven't come forth we were approached by Interstate development to purchase the property they are representing Caribou Coffee Caribou Coffee has a new concept which is a drive through only because of that they obviously do not need a large parcel of brown so they can utilize that piece of parcel with without totally taking care of the whole hill they will have to do some site prep work this is a new concept it is my understanding that there will be about five of these within the next year in the Twin Cities so this we would we would have one of the first ones that we would go up to give you a little idea of what it's going to look like this is how the structure would be on the parcel and the queuing up planning has reviewed this there's enough queueing for the cars so we do think of a work there will be a little outside patio and first question is why would you have an outside patio because it's it's it's a drive-through only interestingly enough the city in the county is working on a large bike trail through the area so we are encouraging interstate to actually have a sidewalk to hook up to the bike trail so the bikers can come down sit on the patio and either enjoy their coffee as the center village you know plan unveils we anticipate more bikers and things like that within that area more residents within that area this may be something they would bike to and sit on the patio and have their coffee the building itself is going to be about 550 square feet the purchase price is is at the appraised price of sixty-five thousand dollars it was appraised in February of this year the agreement will call for them to close on the property by the end of November to commence construction by the beginning of January and to complete construction by the end of next year my guess is they will actually commence construction almost as soon as they can close and get and get going those dates were basically put into the contract to give them some leeway staff is recommending that the EDA recommends to the EDA that they sell the land to interstate development for this project and I would certainly stand for any questions mr. chair I was gonna ask is there any additional funding that the city is going to have to put up for renovation in the land or no mr. chair the developer that will be there cost and we are estimating somewhere between 300 and 350 thousand dollars of development cost just to get to the point that they can start building the structure okay and the roadway is that they're gonna own the roadway or is that private or are we gonna own them Oh Newton Avenue already exists and that's not the driveway you've got there that's the that's the cue for the cars to come to their property their property yeah okay so so it'll come right off Newton there and just curve there correct commissioner and traffic flow it's not an issue a Newton no absolutely not there's virtually no traffic on it is there a walk-up window I'm looking at these pictures it looks like there's a drive-through window mister I believe there is a walk-up window yes I'm curious in the building we just have drive-thru would they have to provide bathrooms for the public correct Commissioner they do yes okay when when are we assuming these uh this bike path would be going through there commissioner I do not know I'm sorry oh that's fine I don't know if miss Dean I'm sorry I don't know either we can follow up with you it's like sure personally I think this is a great win for the city and or for the Builder and everything anybody else have any comments questions no I think it's a great butyl ization of the land where it is it's been sitting vacant for a long time looking the other night and there's no caribou copies within that area there's 110 miles west and Savage was one in the mall but the mall doesn't open until after traffic or the rush hour rush there's a Starbucks down the road so I mean it's a it's a big one for caribou and big one for the city and the developer to you know utilize this space plus it's a different model altogether it wouldn't be a sit down caribou so it would be a different model so no role competition there either yeah I think the pedestrian and biker you know access makes it a win for me anybody else well we need to make a recommendation to the City Council whether to move forward with this or not does anybody have a motion to make okay we have a motion to approve and second any comments questions concerns before we move to a vote seeing none all in favor say aye all right anyone opposed it is unanimous the belief we're moving on to updates the development strategic plan economic development strategic plan updates again mr. gnar now sir Thank You mr. chair as you all know since you are intimately involved in it we developed an economic development strategic plan that was approved by council in November of last year on your work plan this year we have promised that we would make updates at each of your meetings since you did not meet in March we actually emailed all of you an update so the update that you got in your background basically covers the past two months just a couple of highlights we did receive what is referred to as a host community grant from deed for four fifteen thousand dollars that will be put towards a traffic study on County Road 42 a sewer sanitary sewer model study across the whole city and some improvements to 121st and Pleasant which is the road down by the Dodge dealership that leads to what used to be our archery range which is now in the expansion of Dodge which has been in disrepair for years we did go out with an RFQ to hire a branding and marketing firm we have hired that it's a firm called a e2s communications staff has met with them to get them going and they will actually be in front of council next Tuesday night at a work session to give counsel kind of an idea of what their process is going forward the goal is to have a brand ready to go by fire muster in September for the unveiling and then by the end of the year we will have a complete marketing and communications plan put together with a e2s just to give you an idea over the last two months various members of the community valance staff have have met with 50 developers business owners building owners and different kinds of meetings what you see and what council sees is typically the finalization of meetings but there are typically a lot of meetings that in some cases actually go nowhere or in other cases it's a long ongoing process until it gets to you the city manager myself and our lobbyist did meet with both of the Senate and House legislative chairs regarding the host grant because every biennium the host grant has to be renewed it is currently in both the House and the Senate bills as they move forward so we are anticipating with it we will keep that Grant the mayor and city manager also testified regarding the special TIF legislation that was discussed for the Burnsville Center and we are we are monitoring that as it moves forward for the last couple of weeks we also formed what we are loosely calling a partner's group which is the city the Chamber of Commerce the convention bureau and school 191 they will meet on a quarterly basis and basically the idea is to talk about how those four entities can work better together to market the city and this is kind of an offshoot of the branding and marketing that we're going to be doing and our next meeting in June will actually have AE to s address them as one of the focus groups I think you all got an email from our new community development assistant Beth Webber Beth came on board about a month and a half ago Beth kind of replaced sir Arnold our planning assistant when Sarah became the planner and when Miss Dean became our redevelopment coordinator but Beth actually now is providing assistance to both planning a neck amount economic development whereas in the past we just had the planning assistant and then I think you also vo miss Weber got an email about the new redevelopment button on our web site that was through the efforts of our planners miss Deane and our new GIS coordinator to put that button on there which for the public's view you can go to that button now click on the button and you can look up any project that's either ongoing or going through the process of approval so it's really just our way of letting people know what's going on in the city of Burnsville we need no no recommendation that is an update but I would certainly stand if you had any questions on any of the other items that were in your background any questions from everyone I'd have to say that I like the button idea that's really cool be able to see those things up front knows a great idea and I'd like to work with the ISD 191 and these are all great things that are going on I'm very impressed with the direction the city has been heading well those are actually based on the input that this group and our EDA gave us during our strategic plan development also its kind of bias compliment we'll take it and finally I think we're looking at adding a new TIF district that is correct mr. chair the district in question is land up on River Ridge Circle it is two parcels for historical perspective this is the land that at one time had the fantasy suite hotels when those when that hotel was built the the purchaser of that hotel was looking to renovate it quickly found out that the renovation cost were going to exceed the value of the hotel so they tore down the hotel he also was very involved in the building of hotels in the Dakotas during the great big oil movement in the Dakotas that kind of took his emphasis away from Burnsville he built all these hotels and everything else and has basically done nothing on the property local developer has purchased the property is proposing a 81 thousand square foot office warehouse building he would combine the two parcels to build that building he is looking at probably somewhere between 24 and 28 ceiling height which as you know we've discussed before is a ceiling height that we do not have in the Burnsville marketplace or we have on a very limited basis right now it will be a spec building but his intent is to target you know high-tech medical manufacturing that sort of tenant for it it would be an economic development district which has a nine year life Ehlers has estimated that there would be two hundred forty seven thousand dollars worth of TIF available again as you are all aware we are on a pay go system so that TIF would be paid out over those nine years as though as the owner of the property made those those tax payments the the agreement would be structured that the TIF would pay for the additional earth work and retaining walls that is needed to be able to construct the eighty one thousand square foot building it is estimating us without all of that earth earth work he's probably looking at about a forty thousand square foot building which he does not want to do so should that work be less than the two hundred forty seven thousand dollars that's what the developer would receive he will not actually profit from this this gives you a little idea of the proposed layout on the site you can see it is going to be quite a large building again our planning department has has reviewed this site and has has given a couple of suggestions back to the developer but it looks like a very workable site for the project staff would be recommending that the EDC recommend the EDA and not the EDC create TIF district number nine and I would certainly stand for any questions any questions for anyone I guess what is the process to get the TIF implemented in this project to create the district basically there is a there is a there is a document that is created and we have elders working on that there will be a public hearing we are right now scheduled for that public hearing to be on June 18th so anyone can come and speak about the creation of the district we also at the same time are creating a purchase and development agreement with the developer that spells out the construction the TIF the completion dates all those sorts of things that are in your in your background so there's really going to be two documents that we will be looking at between now and June 18th once it's created he goes about does his project and then as the taxes are paid we give him the increment that is available to him so was this area originally zoned for hotel and amenities and or does it correct me if I'm wrong miss Deane but I believe the zoning is either B 3 or B 4 I think it's zone B 3 so it does allow for a variety of uses for commercial office hotel there's a whole list of different types of uses you could do that's on in-district and it's pretty fun about our two characteristic in that local area to have a warehouse that it's an allowed use there been any sort of estimate as far as what the projected property tax difference would be in a forty thousand verse 81 thousand square foot building we did not do that projection is there formulated to determine how many per key places are needed but the size of that building it didn't look like there was enough yes in our zoning district we have a parking calculation that planning will run through okay and I believe initially there were about parking spaces when the developer initially came in their intent was to build a building that met all of zoning codes so setbacks green space parking exterior materials height of the building and whatnot so I don't know how where they are in the process if they're asking for any deviations at this point but when they initially came in they were hoping to meet all of our zoning codes no I I was gonna look at the land and I've keep passing by I don't think to look over there what kind of it said talked about a retaining wall or I was looking at it on Google I couldn't really see there a need for any kind of changes to land but just curious on it is my understanding mr. chair that there is some sloping to the land that would have to be leveled out and dealt with in order to get that size building and again they're gonna have to combine the two parcels and replant to be able to do that size building mm-hmm because this is doubling the size of the building almost correct correct so I have a few thoughts on that if I could share them I'm very familiar with the site I believe this site today holds a building that's close to the 55 to 60 thousand square feet and so any TIF that would be on there I think should be tied only to the additional expansion of going beyond whatever the site will accommodate today and I think we could quantify that pretty quickly with an architect that would be my first thought on that the second thought is that this is a premier site it sits up high it's the it's a gateway site in my opinion to the Minneapolis st. Paul area as you cross the river it is definitely a site that is going to stand out to Burnsville and set a statement for Burnsville the developer historically is an industrial developer that develops 2428 football industrial buildings and not that I'm opposed to that use but it needs to be different than a traditional industrial building in my opinion it needs to have a glass ribbon front to it and it needs to present a very good image to the 35w pedestrians who pass by that site and see that on behalf of Burnsville I think it would be a shame if we allowed a traditional industrial building to be at that site I like the use I like the jobs it creates but I think it needs to be a much higher in better developed building than a historic industrial building that is a very good point it's a really good point yeah that's why it's getting at at the neighborhood because I know that that is a premier site on the site lines coming into Burnsville it is clearly identifiable space it is also in the way of the new event center that we've approved that's gonna be views it will overlook that area so I don't I'm not opposed to an industrial building there 24 28 foot but I think we need to do require some additional improvements on that side of the 35w site at least and that would be different than a traditional industrial building but in line with a hi-tech building that's my two cents on that do we know what the height differential is between this proposal and adjacent building that's already there there are no buildings in the area that would be taller than this building that I am aware of no this is a strip mall here and most of the buildings in the surrounding area are my guests commissioner they're somewhere in the 25 to 30 year old buildings so chair if if I just might add something from a Planning and Zoning perspective so when the planners look through the proposal they'll be looking at what does our zoning code allow and if the developer doesn't ask for any waivers or deviations from the city's zoning code the city staff doesn't have the flexibility to say we want this to be all brick in class if we have a list of materials that says you can do you know 50 different materials and the developer chooses to do any one of those materials or mix of those materials they can do whatever we want so from a Planning and Zoning standpoint as long as they meet city code we don't have a whole lot to say about how the the proposal looks again from a Planning and Zoning standpoint so yes it might be a premier site yes it it might be a gateway to Burnsville but that flexibility and creativity is left up to the architect and the the applicant again to what's allowed in our city code as well to use that as a as a framework for what they propose in front of us there's a stipulation to the TIF district could we add that in there or is that only too far is that if I could Monsieur here building materials are not eligible expenses in a TIF district its site work prep work that sort of thing so to call out for that in the in the creation of the TIF district would not be something that staff would be looking to have to okay from from my perspective I'm familiar with the area - I don't think that that's gonna be the visual aspect is gonna be such a big issue because when you're coming socially when you're coming from the south it's just on the other side of the highway 13 bridge so I think your your view of that building we would be blocked until after you come up from the bridge and then it comes and goes pretty quickly so that doesn't worry me as much I'm fine with the use the warehouse I guess my concern is whether it's financially worth it for the city to do a TIF if we haven't done sort of the cost-benefit analysis if they're gonna do a 41 or 40 thousand foot warehouse anyway without the TIF if I could mr. Commissioner if that's what you took from my comment I misspoke the developer has told me that if the TIF district is not created they will put the land back up for sale they have no intention of building a 40,000 square foot building how long has it been for sale Oh ten years or more and how many new jobs with this expect to create we are asking for in the agreement 20 new jobs because this is a spec building it's it's a little hard to come up with the exact number of jobs so we are saying at least 20 jobs at at least a $25 an hour great any other questions or comments this is one we're gonna have to make recommendation to the EDA to create the tip district your recommendations to be made we're all thinking that's fine well I I mean just maybe some more discussion on things I'm thinking through is the is a trade-off if if you don't do the TIF then you've got of a willing developer walking away there's a couple of consequences one is it's a it's a dead space of land that hasn't it's a high profile speed I agree it's not the highest profile space so it's not it's not the wedding dress I heard anything like that we're we're messing with here so but and secondly it's it's a good thing to have a reputation in Burnsville as cooperative with developers so I don't want to be too like oh no it doesn't meet our high standards to be but I think given at if that would help did you have a feel for what the break-even how many years it would take to recover that TIF based on his design and his expectations well the economic development district mr. Commissioner is nine years so the payout would be overnight or nine years right and I as was pointed out in your background the request does meet the parameters of our business subsidy policy for the creation of a TIF district which are what it's adding text jobs it's it's redevelopment it's it's it's basically taking an area that has nothing on it and creating something and staff recommends this yeah that's correct commissioner we are recommending that you recommend that the ETA create the district the big positive on this is is gonna bring in a warehouse with the dimensions that we are looking for in that area so just a point of clarification first of all the site just to clarify and it has not been for sale for ten years it was sold by a hotel developer that was going to redevelop and then as was shared it was not a they did not go ahead with it and it's been on the market the last few years at a pretty high price and with the recovery of the industrial markets a very desirable location at the right price so just to be clear on that and second of all is that you know am I here and you say that as the EDC we have no ability to make sure that the building is built in a way that's a little bit above standard from a traditional industrial building and there's nothing we can do about that the only thing that we can really talk about is do we approve the TIF or not approve the TIF now people can't even stipulate the the percentage of TIF based upon the incremental gain well the answer to the first part of your question is the building material aspects of the building is the purview of the Planning Commission not the economic develop Commission the Economic Development Commission can certainly recommend that if we create the district that there'd be less than the tip that is available that will be given to the developer you can certainly make that recommendation yes so can the Planning Commission can they put some stipulations on on the type of building or design yes their stipulation is that it will need to meet as Miss Deane has already stated will mean to need our zoning and ordinance right which she stated the have from the early meetings that we've had with the developer their intent is to meet to all of our zoning codes now it's been a couple months since I've had you know personal contact with the applicant and things you know may have changed but it's my understanding that that again their intent is to meet all of our codes extra materials green space setbacks height things like that yes I believe what Commissioner no favor is asking is that there be a request that they go above and beyond that that is not something that that that we can do we can only do that if they're asking for any deviations from code if they're coming in with a straight project that moves all of the requirements then we have an obligation to approve their project we meaning ultimately City Council if we establish this TIF district and this particular developer doesn't do what he says it's going to do and he sells the plant the land does the TIF stay yes okay but the amount it would then be dependent on whatever the increment is for whatever gets built there okay but we have commissioner we have gotten no indications from the developer that if the district is created that they won't build the building they have stipulated that if the district is not created they will put the land back for sale so it seems to me we have a bird in the hand we have a land for sale that is a huge lot and would be a huge building it would bring economy it would bring jobs it would bring you know to the the only the only negative is that it might not be pretty right in that spot which is a high visible spot I agree but I would have to say I think we need I would lean more towards doing the TIF than not it for just that reason yeah I'm the similar position I it's six to four I've kind of favor of doing it but there are some reservations if we communicate that to the Planning Commission and and have some sort of notation or some general commentary not legally I know it's not binding but it would certainly this help maybe encourage them but nowadays some of these develop these and even industrial developments the new materials they're using look a lot better than they did twenty years ago some of the stuff I'm seeing Apple Valley and the other areas I go wow I mean it's not an eyesore at all so my hope is that that's what they use the more contemporary materials and a little interesting design so I think one of my concerns is we're already considering tips for the Burnsville Center is that being a potential use for the future and I would see that being pretty substantial use of the TIF so I I just hesitate to create another tip district for this purpose when this land could potentially be viable without it so I'm hesitant I mean and I guess I right now I'm leaning towards no versus yes is there any limit to the amount of tip tips I think of assets before tips there's no K well there is not there's not and one TIF district does not affect another TIF district does anybody have any kind of motion they'd like to bring forward it seems like a lot of us are on the fence on this I'm just a point of clarification I still didn't quite understand kid we tight if just two the incremental gain in building size versus the entire so in other words if the if the parcel today supports a fifty-five or sixty thousand square foot building versus you know forty thousand which again we could quantify and so to gain the additional 20,000 square feet there's additional costs incurred to do that from a site prep could we tie it to that additional cost that's exactly what it's gonna be done commissioner but we can quantify that versus just give him a blanket TIF on the whole as I as I originally said mr. commissioner if that cost is less than the two hundred forty seven thousand dollars that's what they would receive is whatever that lesser amount if that cost is more than two hundred forty seven thousand dollars they're only gonna get two hundred forty seven thousand dollars because that's the increment that's available to them but somebody monitors that on the city staff I do okay well I would make a recommendation if we're done discussing that we do approve the TIF as it's being recommended by staff I'll second a motion in a second any discussion okay I'm not seeing any discussion no all in favor say aye all right and one opposed nay okay so you call the house and you have a habit thank you all right that clears that I believe that is everything that we were going to talk about today there's only one item left on the agenda and that is adjournment does anyone want to make a motion for adjournment I just want to before we making the German thank you Chris for all the service you've done commercial thank you six seven years you've been on the Commission huh and then I'll make a motion to adjourn second okay motions have been filed with compliment so thank you and seconded all in favor say aye all right thank you have a great night