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5.4. SR 01-12-2004MEMORANDUM Item 5.4. TO: FROM: DATE: SUBJECT: Economic Development Authority ~Pl~yor & City Council Housing & Redevelopment Authority Catherine Mehelich, Director of Economic Development December 8, 2003 Discuss Update of Economic Development Strategic Plan Attachments · 2000-2003 Economic Development Strategic Plan, Revised November 1999 · Economic Development Strategic Plan, Adopted May 1997 Issue The first Economic Development Strategic Plan was adopted in May 1997. At its two-year anniversary in May 1999, the EDA determined that the original Strategic Plan should be updated. It is now 4 years since the most recent revision to the 2000-2003 Plan. The EDA has included in its 2004 budget an amount up to $3,500 for the update of the Strategic Plan. The Strategic Plan provides a framework for the Commissions to work within and focuses staff energies on those priority areas important to the economic health of the City. Background 1997 Plan The 1997 original Strategic Plan utilized a taskforce comprised of volunteers representing the following groups: · Mayor/City Council · EDA Chamber of Commerce · Utilities Commission · Downtown Representatives · Local Business/Industry Representatives Update of Economic Development Strategic Plan December 8, 2003 Page 2 of 3 The Taskforce also called upon the special areas of expertise represented by the EDA for input on issues related to the city's industrial base, and the HRA for input on issues related to downtown development/redevelopment. The strategic planning process was facilitated by Jim Brimeyer, The Brimeyer Group, a professional consultant with a high level of expertise in group facilitation, plan development and city operations. Through the process, four major issues which affect the economic growth of the City of Elk River were developed: · Issue - Industrial Base o Goal - Attract new businesses to increase the city's industrial base. · Issue - Business Retention and Growth o Goal - Retain and grow the city's existing business/industry. · Issue - East Highway 10 development/redevelopment ~ Goal - Redevelop the east Highway 10 corridor · Issue - Downtown Redevelopment o Goal - Attract reinvestment in the Elk River central business district. 1999 Update The 1999 Modification Committee consisted of the HRA, EDA and City Council. The purpose of the modification was primarily to reexamine the four major issues and related goals and determine if they were still applicable at that time and into the year 2002. The Modification Committee agreed that the four original issues expressed in the Strategic Plan would remain - with some reprioritization. The major shift in issues occurred with the moving of the Downtown Redevelopment to a lower priority issue and heightened the need for a focused Industrial Marketing Strategy. Many of the action steps identified in the 2000-2003 Plan have been completed. At the same time, new challenges and opportunities have arisen that may require a joint discussion of the EDA, HRA and City Council, including but not limited to: · Role of Strategic Plan in supporting the Comprehensive Plan Vision for the future · The City's role in housing and housing's relationship with economic development · Implementation of the downtown revitalization project · Evaluation and prioritization of other redevelopment areas (north of Highway 10 at Jackson, Ron's Foods, northeast corner of Proctor and Highway 10) · Challenges to siting industrial prospects in private business parks · Future role of the business incubator · Future role of Energy City as a marketing tool Discussion Points · Do the EDA, HRA and City Council feel the need to revisit the Strategic Plan? If so, what process should be used to update the Plan? Taskforce or Modification Committee? Staff recommends that the City utilize the services of an outside party facilitator, such as Mr. Brimeyer again. · Does a late afternoon-into evening work session accommodate commission and council members to discuss the Plan update? · Are there other Commissions that should be involved in the Plan updating? Update of Economic Development Strategic Plan December 8, 2003 Page 3 of 3 Next Steps With the EDA, HRA and City Council consensus to update the Economic Development Strategic Plan, staff will continue discussions with Mr. Brimeyer to submit a proposal for cost, process and timeframe to complete the Plan update. Staff will provide a copy of the proposal at the January meeting. City of Elk River 2000-2003 Economic Development Strategic Plan Adopted May, 1997 Revised November 1999 ",4 historic river community serving as a regional center with a favorable location near the Twin Cities metropolitan area" Our mission is to actively participate in economic development by utilizing available resources to leverage viable and healthy investments in our community. Such investments will create diverse job opportunities as a result of a stable and growing business and industrial base. We will strive to provide quality services, maintain a favorable tax rate, supply full-cycle housing options for our residents, and foster an environment that will result in substantial growth of our local economy. Modification Committee City Council Economic Development Authority Housing and Redevelopment Authority Facilitator: Jim Brimeyer, The Brimeyer Group Major Issues and Goals Industrial Base Attract new businesses to increase the city's industrial base Business Retention and Growth Retain and grow the city's existing business/industry Marketing Strategy · Create an industrial marketing strategy to develop the city's business parks. Develop/Redevelop E. Hwy 10 & the CBD Undertake activities that facilitate development/redevelopment on East Highway 10 and in the Central Business District. I. Grow Industrial Base Goal: Develop West Business Park ~'~: '~ ~Maintain current joint development agreement with Tony Emmerich. Consider a joint development agreement with Gagne and Wilson. Develop well focused target marketing tactics: · Market to brokers and others with connections to industry, such as MN Technology. · Target an industry cluster, such as the energy industry (Energy City). · Work with local industries to market Elk River to their suppliers and customers. EDA to research construction of a spec building and locate a tenant. · Establish bank partnerships · Establish developer partnership · Identify funding sources (i.e. franchise fee revenue) Consider completing construction of Business Center Drive. Explore marketing methods employed by developers and builders. Examine appeal of West Business Park to specific types of industries. (Target marketing, Industry cluster) Develop specific marketing materials for West Business Park. Maintain and build networks with banks, brokers, chamber, existing businesses, media, and others. · Business Retention & Growth Goal: Retain and ~row existing industries Complete BRE Survey and distribute final results to council, EDA, Industries and Chamber of Commerce. Consider publishing periodic (quarterly or bi-annual) newsletter highlighting economic development activities, practices and issues. Create local industrial business publicity program - have quarterly feature stories written on industrial firms. Utilize business round table approach to gauge business's attitude toward developing policies and projects. Distribute marketing materials to local industry and promote incentive programs. Ads - Continue to feature local firms in City Business, Ventures, etc... and explore local advertising opportunities. Utilize DTED's Manufacturer's Week to showcase existing firms. Create opportunities for interaction between business owners and elected/appointed officials. Involve local industries in a major marketing event. Maintain database of industrial businesses. Consider continuing EDA Commitment to the Business Incubator Project. III. Marketing Strategy Goal: Develop an industrial marketing strategy to develop business parks. Establish a marketing plan committee comprised 5-7 of business & civic leaders. Consider hiring a consultant to help facilitate the formation and implementation of a marketing plan. Update and maintain marketing materials. Complete construction of economic development website. Utilize Energy City designation as a marketing tool. IV. (Re)Development on E. Hwy 10 & in the CBD Goal: Undertake activities that facilitate (re)developmeqt on E. Hwy 10 & in ~??t.,he CBD. Highway 10 Develop criteria for designating redevelopment areas. Identify redevelopment/development areas. Develop database of east Highway 10 properties. Consider locating additional sites for Elk River monument/entry signage. Examine use of Redevelopment Financing Program along east Highway 10. Central Business District (Downtown) Develop criteria for designating redevelopment areas. Identify redevelopment areas. Consider hiring a consultant to design a redevelopment plan for downtown. Develop design guidelines for redevelopment in the CBD. Issue Request For Proposals for redevelopment sites in CBD. Further explore the concept of facade grants in cooperation with local banks. Continue work on CBD action plan. Construct database of downtown businesses Continue marketing King and Main site for redevelopment Additional Action Steps Modify TIF policy to comply with changes in State law. Continue professional development of staff through conferences, formal training programs, etc .... Utilize GIS to manage data of industrial and commercial real estate. Explore the development of a rail spur Inventory all available commercial/industrial land and buildings. Utilize existing tools to encourage development: TIF, Micro Loan, Tax Abatement, SCBDF, State, Initiative Foundation. Ensure Brown property remains available for industrial development. Grow Industrial Base Goal: Develop West Business Park 2000 2001 2002 Action Steps 1 2 3 4 1 2 3 4 1 2 3 4 Maintain Joint development Agreement with Emmerich Consider joint development agreement with Gagne ., & Wilson eveiep wel! focused =target m~:rketmg tactl~;~ === · Market to brokers with industry connections · Target an industry cluster · Market to local industry supplier & customers Research construction of a spec building and locate a tenant. · Establish bank & developer partnerships · Identify a funding source Consider completing construction of Business Center Drive H X Research marketing methods used by builders and Developers Examine appeal of West Business Park location to specific industries. Develop specific marketing material for West business Park Maintain & build networks with banks, brokers, ,--, · chamber, media, existing businesses etc... '~' Business Retention and Growth Goal: Retain and grow existing industries 2000 2001 2002 Action Steps 1 2 3 4 I 2 3 4 1 2 3 Complete Business Retention and Expansion ~.. Survey Publish economic development newsletter to send to local industries Create publicity for local industries · Utilize a business round table for planning and policy establishment Distribute marketing material to local industry and promote incentive programs Feature local firms in local and regional advertising, such as the Star News and City Business Showcase existing firms during DTED's ~.~ LO ~,-.~ Manufacturer's Week Create opportunities for interaction between business owners and elected/appointed officials Involve local industries in major marketing event Maintain database of industrial businesses Consider continuing EDA commitment to the Business Incubator Project III. Marketing Strategy Goal: Develop an industrial marketing strategy to develop business parks 2000 2001 2002 Action Steps 1 2 3 4 1 2 3 4 '1 2 3 4 Establish Marketing Committee of 5 to 7 to people to assist in the development of a plan ~'~ X Hire a consultant to skilled in marketing to facilitate the formation and implementation of a plan. Update and Maintain industrial marketing materials. Construct Economic Development Website Utilize Energy City designation as a marketing tool ~, I IV. Develop/Redevelop East Highway 10 & the Central Business District ~ Goal: Undertake activities that facilitate development/redevelopment on East Highway 10 & in the CBD. 2000 2001 2002 Action Steps 1 2 3 4 1 2 3 4 1 2 3 4 Develop criteria for designating redevelopment areas. Identify redevelopment/development areas. H Develop database of E. Highway 10 properties. H Consider locating additional sites for Elk River monument/entry signs. U Examine use of redevelopment financing program along E. Highway 10. Develop criteria for designating redevelopment areas. Identify redevelopment areas. Develop design guidelines for redevelopment in the CaD. H Issue request for proposals for redevelopment in the CBD. H Explore concept of facade grants in cooperation with local banks. H Continue work on CBD action plan: Construct database of CBD businesses Continue to market King & Main site for ,, redevelopment. ~, Other Action Steps 2000 2001 2002 Action Steps 1 2 3 4 1 2 3 4 1 2 3 4 Modify TIF policy to comply with changes in State Law. Continue professional development of staff through ~, · conferences, formal training programs, etc... Utilize GIS to manage data base of industrial and commercial real estate. Explore the development of a rail spur. ., · Inventory all available industrial and commercial ., · land and buildings. Utilize existing tools to encourage development:.. · TIF, Micro Loan, Tax Abatement, Etc... Ensure that Brown property remains available for~, · industrial development. City of Elk River · Economic Development Strategic Plan Adopted by City Council action on May 19, 1997 ELK RIVER ".4 historic river community serving as a regional center with a favorable location near the Twin Cities metropolitan area" Our mission is to actively participate in economic development by utilizing available resources to leverage viable and healthy investments in our community. Such investments will create diverse job opportunities as a result of a stable and growing business and industrial base. We will strive to provide quality services, maintain a favorable tax rate, supply full-cycle housing options for our residents, and foster an environment that will result in substantial growth of our local economy. Organizational Chart ECONOMIC DEVELOPMENT STRATEGIC PLAN Elk River City Council I I Strategic Planning Task Force I I I EDA II C.~m~o, I IHRA Major Issues and Goals Industrial Base ~ Attract new businesses to increase the city's industrial base Business Retention and Growth ~ Retain and grow the city's existing business/industry East Hwy. 10 Development/Redevelopment ~ Redevelop the East Hwy. 10 corridor Downtown Redevelopment ~ Attract reinvestment in the Elk River Central Business District Priority # 1 Industrial Base Attract new businesses to increase the city's industrial base · -> Phase I -West Elk River Business Park ~ Modify zoning north of County Road 30 in the West Business Park from R1C to BP ~ Update/maintain an inventory of property owners in the West Business Park ~ Outline the parameters of a "Joint Development Agreement" for West Business Park property owners which will address assessment issues, land prices, and cooperative marketing of properties to encourage development of those properties {~ Negotiate land prices in the West Business Park and research funding options for potential city purchase ~ City Council and EDA to determine whether to proceed with a Joint Development Agreement or city purchase of property - show financial options {~ Enter into a Joint Development Agreement or complete acquisition of the subject properties {~ Complete conceptual platting of properties for use as a marketing tool ~ Modify current marketing and advertising program to include additional properties ~ Market the properties to industrial users Industrial Base - Continued Phase II -Industrial areas east along the newly proposed transportation corridor and County Roads 12/13, east Highway 10, north Highway 169, and other parcels ~ Accept a concept proposal for a new transportation corridor between County Roads 12 and 13 proceeding south to connect with Highway 10 ~ Identify appropriate industrial sites along this new transportation corridor ~ Identify appropriate industrial sites in other areas lying within the Urban Service Boundary I~ Identify appropriate industrial sites lying outside the Urban Service Boundary along east Highway 10 ~ Undertake rezoning of these industrial sites ~ Establish a timetable for construction of the proposed transportation corridor and other public improvements in this area ~ Complete an inventory of property owners within the newly identified industrial areas ~ Outline the parameters of a "Joint Development Agreement" with these property owners which will address assessment issues, land prices, and cooperative marketing of properties to encourage industrial development ~ Negotiate land prices and research funding options for potential city purchase ~ City Council and EDA to determine whether to proceed with a Joint Development Agreement or city purchase of properties ~ Complete conceptual platting of properties for use as a marketing tool I~ Modify current marketing and advertising program to include these newly identified industrial areas ~ Market the properties to industrial users Industrial Base - Continued Phase III -Other Industrial Areas -Gravel Mining Site ~ Identify appropriate industrial sites/areas currently being mined ~ Modify underlying land use if determined appropriate in anticipation of future rezoning to Industrial or Business Park ~ Work with property owners to establish a timetable for availability of these industrial sites ~ Work with property owners to encourage consistent and planned availability of these industrial sites over the next 7-15 year period Industrial Base - Connnued Programs and Incentives ~ Support the use of Tax Increment Financing (TIF) as a tool to retain and attract industrial businesses ~ Modify the TIF policy to allow maximum flexibility and to guide the city's appropriate use of this tool ~ Support Sherburne County's effort to establish a revolving loan fund, and other resources, for economic development I~ Encourage Elk River Municipal Utilities to establish a dedicated revolving loan fund for economic development and to provide a competitive incentive electric rate for qualified industrial businesses [~ Modify the Micro Loan policy to allow maximum flexibility for use as an incentive to encourage industrial business growth ~ Research opportunities for using the Internet to identify industrial prospects I~ Update the community profile and demographic information annually ~ Maintain an inventory of available buildings for manufacturing and other industrial users I~ Plan and coordinate a marketing event for industrial realtors and brokers, developers, and prospects ~ Establish a policy to guide the use of the city's development fund in a manner which will support the growth of the city's industrial and business base I~ Work with local banks to establish a cooperative public/private economic development financing program Priority #2 Business Retention and Growth Retain and Grow the City's Existing Business and Industry I~ Coordinate the efforts of"Joint Development Agreements" and/or the city purchase of land in order to provide expansion opportunities for EXISTING businesses ~ Maintain consistent contact with existing businesses through the use of letters and surveys ~ Initiate a "Business Incubator" program to support the location of high tech and job intensive business growth within Elk River ~ Use available financing tools to leverage private investment in order to retain existing businesses and encourage growth ~ Improve the perception and visibility of the Economic Development department's business retention efforts through the use of the city newsletter I~ Work with the Department of Trade and Economic Development, Small Business Administration, Central Minnesota Initiative Fund, and other resources to increase awareness of existing programs which provide support for business expansion and growth ~ Expand the Micro Loan program to assure that existing businesses qualify as a high priority consideration ~ Examine and research the implementation of new programs which focus on business retention ~ Work with the Sherburne County economic development office to address the issue of labor force availability Business Retention and Growth Continued Upon completion, distribute the results of the central business district Market Study so that it can be used to enhance the growth of existing businesses Use the Energy City program as a marketing tool to support the growth of energy related industry Develop a cooperative marketing plan with Energy City and incorporate with the current marketing efforts to target energy related business growth Coordinate the business retention survey efforts to establish a baseline of current employment within Elk River's currently existing energy related businesses Coordinate an event through Energy City with Energy Alley member companies to market Elk River's growth potential in the energy industry Priority//3 East Hwy. 10 Deve 1 opment/Re dev e lop ment Redevelop the East Highway 10 Corridor ~ Establish the criteria for identification of redevelopment areas within and outside the Urban Service Boundary along east Highway 10 ~ Identify and prioritize these east Highway 10 redevelopment areas I~ Establish a plan to redevelop and market each of these prioritized areas coordinating efforts with the proposed transportation corridor connecting County Roads 12/13 and Highway 10 ~ Inventory property owners within these redevelopment areas and discuss possible "Joint Development Agreements", and other cooperative efforts which could be undertaken to aid in development of these areas ~ Establish a long term design and land use plan which might include establishing a uniform design theme for the overall area utilizing some of the elements of the central business district Focus Study (when completed) Priority #4 Downtown Redevelopment Attract Reinvestment in the Elk River Central Business District (CBD) --> Overall CBD Design ~ Identify the criteria and scope of a Focus Study of the physical elements of the CBD, including elements of the riverwalk concept ~ Bring in an outside consultant, if determined necessary, to complete the Focus Study within the scope identified ~ Examine criteria for additional HRA programs which may provide incentives to property owners to implement the results of such a Focus Study i.e., signage improvement program, CBD marketing program, partnerships with local banks, building rehabilitation program ~ Review the zoning and land use plan for the CBD as part of a Focus Study to determine if changes are appropriate Downtown Redevelopment - ConUnued Redevelopment Sites ~ Outline the criteria which will be used to identify redevelopment sites within the CBD ~ Undertake the identification and prioritization of these redevelopment sites ~ Implement a redevelopment and marketing plan for each of the prioritized sites Downtown Redevelopment - Continued Finance and Marketing ~ Outline the criteria and scope of a Market Study which will, in part, help to identify viable business opportunities for the CBD ~ Bring in an outside consultant, if determined necessary, to complete the Market Study within the scope identified ~ Distribute the results of the Market Study to potential developers to attract specific businesses to the CBD ~ Support the use of available financing tools such as TIF to aid in redevelopment of these identified sites ~ Utilize the Internet to market and advertise the CBD to specific retail and other business uses which are to be identified within the Market Study ~ Partner with financial institutions to establish programs, if necessary and appropriate, to implement action steps based upon results of the Focus Study and Market Study ~ Create a positive method for ongoing communication with the Chamber of Commerce, Rivers Edge Downtown Development Corporation, and all CBD property owners regarding relevant issues within the CBD ~ Support all groups efforts to coordinate retail promotions within the CBD ~ Complete the redevelopment project at the corner of King Avenue and Main Street ~ Work with CBD businesses to address parking needs and issues