4.1. SR 02-09-2004MEMORANDUM
TO:
FROM:
DATE:
Economic Development Authority
Mayor & City Council
Catherine Mehelich, Director of Economic Development///~/J
February 9, 2004
SUBJECT: Consider Concept Approval of Orluck Industries, Inc. Expansion
Siting Proposal
Attachments
· Preliminary Expansion Siting Proposal for Orluck Industries, February 5, 2004.
Issue
The attached Preliminary Expansion Siting Proposal has been submitted by staff to Orluck
Industries, Inc. with regard to the company's proposed expansion and relocation project.
Staff has proposed that the City consider selling its city-owned Joplin Street lot to Orluck
Industries for the construction of a light industrial/business park building. Orluck
Industries is requesting that the City and County provide Tax Rebate Financing in order to
write-down the land cost to $0. Mr. Orluck is anticipated to be present for the EDA
meeting to discuss the proposed project.
Back_ground
Orluck Industries conducts light, precision machining of plastic and metal components for
the medical, computer, semi-conductor and tele-communications industries. The final
product components consist of either a fixture or testing device for the above industries.
The company currently employs 13 full-time staff and 2 part-time positions with an hourly
wage between $15.00-22.00 per hour.
Staff has been in contact over the past two and a half years with Mark Orluck, President of
Orluck Industries, Inc. Currently leasing approximately 4,800-square feet in Dayton, MN,
the company is seeking a suitable location within the northwest metro area to expand. The
City of Big Lake has aggressively pursued the company's relocation project, in addition to
staff's efforts. In 2002 staff had proposed the same Joplin Street lot for Mr. Orluck's
proposed project.
River
City of Elk River
Preliminary Expansion Siting Proposal
Orluck Industries, Inc.
February 5, 2004
I. Site
A.
Proposed Location
2.79 acre lot
Lot 1, Block 2, Country Crossing Business Center
SW Comer of Joplin Street & Business Center Drive Intersection
Access from far westerly side of lot to Business Center Drive, and the far southerly
side of the lot to Joplin Street
See attadmJ Location Map.
Zoning/Land Use Requirements
Business Park/Community Commercial
A land use amendment to be administered by the City (to change to Light Industrial
land use)
Building Requirements
Building and site to comply with Business Park District Ordinance and other City
requirements.
See attadmJ Business Park District ~ R equiro~v:ts.
Land Cost/Value
$1.66/sf 2.79-acres Total: $201,520
Includes special assessments, park dedication, storm drainage improvement estimate
($15,000) and land cost.
Project Timeframe
Upon acceptance of this Preliminary Proposal and a letter of intent, the Director of
Economic Development will prepare and submit a comprehensive proposal
including a detailed project timetable for finance and building permit timing and
application requirements.
At this time the proposed site would require a land use amendment to be submitted
by City staff. This process can take up to 60-days, to be completed by April 19,
2004. Financing application review and considerations can take up to 45-days and
can run concurrently with the land use amendment, building site plan and permit
application review process.
A Conditional Use Permit is required if loading docks or overhead doors face a
public street.
City of Elk River
Prdiminary Proposal for Expansion Siting
Orluck Industries - February 5, 2004
Page 2 of 2
II.
Financing
A. Project Costs
Land $ 201,520
Construction $1,000,000
Relocation Costs $ 50,000
Equipment $ 0
Total Uses
$1,251,520
2.79 acres at $1.66/SF
Estimate - 20,000 SF at $50.00/SF
Bo
Proposed Business Finandng Sources
Bank $1,000,000
Owner Equity $ 50,000
Tax Rebate Finance $ 201,520
Total Sources $1,251,520
50/50 City and County*
* Total City Assistance Proposed: $ 100,760
* Total County Assistance Proposed: $ 100,760
Co
Job & Wage Goals (to be met within 2 years of building occupancy)
Job Retention 13 full-time at $15.00-20.00/hour and
2 pm-time at $17.00/hour
Do
Financing Applications
Tax Rebate Financing assistance, or Tax Abatement, is proposed to be provided in
the form of "upfront" financing, in which the business/property owner receives the
benefit of using the land cost as "instant equity" when considered by a bank. Upon
an executed development agreement, the city would transfer the land to Orluck
Industries for $1.00 and the city would be reimbursed annually with 100% of
abatement proceeds upon receipt of annual real estate taxes by the City and County
for up to an amount eqUal to the land cost, presently estimated at 10-year term.
See attad~ Tax Rebate Financing Projo:tion Worksheet.
Requires Orluck Industries completion of City and County Tax Rebate Financing
Applications and payment of applicable fees.
Proposal is contingent upon approvals from the Elk River Economic Development
Authority and Elk River City Council, in addition to the Sherbume County
Economic Development Alliance and Sherburne County Commission.
E°
Other
Proposal is exclusive of project contractor/builder.
Orluck Industries is eligible to apply for the Econo~Derdogn~ TM:,nicalAssistane
& CCerations Consulting Program for up to $2,000 grant toward consuking services
from MN Technology, Inc.
Preliminary Proposal Accepted:
PROPOSED SITE
COUNTRY CRosSIN
BUSINESS CENTER,
LOT 1, BLOCK 2
Business Sites
~ PROPOSED NORTHSTAR CORRIDOR
COMMUTER RAIL DEPOT
ELK PATH BUSINESS CENTER
80 ACRES
GAGNE PROPERTY
18 ACRES
ELK RIVER BUSINESS PARK
25 ACRES
ELK RIVER EDA PROPERTY
45 USEABLE ACRES OUT OF 90
CASCADE INDUSTRIAL PARK
46 ACRES
Phone: 763.44tv74-20N°ie:
Fax: 763.441'.7,-4~
NEW INDUSTRIAL DEVELOPMENT
EXPANSIONS / RETENTION
For site specifics call Cathy Mehelich at 763-635-1041
This map does not show the entire
city limits of the City of Elk River.
x~w.,.ci.elk-;i ye r. n2 lq.~.!s
COUNTRY CROSSING BUSINESS CENTER,
~ LOT 1 BLOCK 2
?
ki.W. i,./z of the S.W'. !/4, ~ec. 32, T. 23, ~. 2~.
~ South fine of the right-of-way
'~ ...... of U.S. H~anwcv No. I0
,,"' ~- N88*40'OO"W '",, 378.59
~ ~¢~0~ ~,, ~ ~ ~ ~ ~
.... ~/ ~ ~ ~ ~ ~ - ~ ',
......... .~ ,,,s ..~
' ~' ' ", - ~ .... '~
~ 30-12S$ ELK R~P~ CODE
{ 19 } ~iinis~ora~e.
{SO} _~-I!1 uses allowed as a conditiena] use in
the I-i zone.
la) ~C,m~kecnz,,-a/ s~an~ar~s. N-o provisions of
8eC~O~ on
~-~ except subsection 30-938{2) per-
taining zo exterior building finish azd subsection
,~,-~.~o,~ ~e:maininff to roo~n[ standards apphes
to this dissrics.
(Code i982. ~
Sem 30-1294. BP business p~rk district.
(!) The business park district is,established
to encourage a planned~ interbred envi-
ronment for certain indus:Mal~ o~ice, and
commercial uses wl~ch ere compatible
with ~d complement esch.oZher es well
ss the surroundins land uses. The under-
lpin~ lsnd use desi~azion within the dis-
tMcz may vary and may be either
indust~al or highway business. Develop-
ment ~dthin the business park dist~ct
will co~zespond with the land use desig-
nation. Indust~al and office uses are al-
lowed where the land use designation
ii~ht induszriat, and commercial uses are
allowed where the land use designation
highway business.
(2) It is the intent of this section that devel-
opment reflect common themes usin~ com-
patible architectur~ desi~ and consis-
tency in silage, landscapin~ and
It is Mso the intent to encourage busi-
nesses which ~enerate a high number of
jobs per square foot rather than p~edom-
inan:]y warehouse t)~e uses.
(b) Per~:~r~e~ ~ses. Permitted uses in ;he BP
disZric~ are ~s follows:
(i) Permit%ed uses al]awed when the under-
]!dn~ l~nd ese is iigh% industrial are as
follows:
a. Light manufaczurin~.
b. BesearcN and deveiepmen% iaberaze-
ties.
c. Government. business, and profes-
sional o~ces.
d. Mail order operations.
e. Telecommunication operations.
f. Sherburne County fair.
\l;arehouse space nor exceeding 50
percent of the entire buiidin~.
~. Showroom s~ace.
i. Repair and maintenance, excludins
auto repair.
(£} Permitted uses allowed when the under-
ipin~ land use is highway business are as
follows:
a. Health athletic clubs.
b. Personal semdce establishments.
c. Financial institutions.
(c) Accssso~ '~sss. Accessory' uses in the BP
district are as follows:
Off-street parking lots or facilities.
(2)Private recreational facilities.
(3) Public shelters and essential sec'ices.
(4') Retail sales, pro~dded the following condi-
tions are met:
a. The retail sales activity shall not be
located in an administrative office
facility but shall be located within a
business, the principal use of which
is not commercial sales.
b. The retail sales activity shall not
occupy more than 15 percent of ~he
g~ross floor area. or a ma>immm of
5,000 square feet of the occupied
quarters, whichever is less.
c. ,_ne retail sales activitysnaz~' ~ be .~=-~
luted and subordinate ;o the princi-
pal USe.
d. Nc sip. identiSdn~ or ~romoting that
retail sales occur within the building
sh~!:be ~nsible from outside Zhe build-
ing.
e. Freestanding retail shops and stores
shall be limited ;o those which com-
plement other uses within the busi-
· ~ $6-1294
ness park and provide a seRdce zo
chose other businesses, and shall nor
exceed 20.000 square feet m size.
f. RezaiNwhoiesaie sales incidental to
products manufactured, assembled,
or warehoused on the premises may
be permitted as an accessory use
proxaded no more than ten percent of
zhe building is used for retail/whole-
sale sales.
($) Therapeutic massage when offered within
the confines of a medical or chiropractic
clinic~
(6) TempOrary si~s as permitted in section
80-$,51 et seq.
(?) Permanent signs. Not withstanding the
provisions of section 30-$50 et seq., the
followin~ requirements shall be met:
a. All freestanding signage shall be of a
monument s~yle si=om and have a
mammum size of 64 square feet and
height of eight feet.
b. One on-premise business wall sism
per occupancy, not to exceed two
square feet in sign area for each
linear foot of the building ~on~age
up to a maximum of 128 square feet
per occupancy is permitted.
(d) Coaditfon~l ~ses. Conditional uses in the
BP district are as follows:
(li Conditional uses allowed when the under-
l~dng land use is light industrial are as
follows:
a. Warehouse space exceeding 50 per-
cent of the total building floor area
up to a maximum of' 65 percent.
b. Vocational, technical and trade
schools.
c. , Loading' areas/overhead doors when
located in ~ont yards.
d. Above,round storage tanks.
Government buildings and !~ciiines.
2', Conditional uses aiiowed when the under-
lying land use is high,-ay business are as
iohov~ ~.
a. Hotels and motels.
b. Licensed day care facilities.
c. Retail sho~s and stores which com-
plement and serve the business park,
subject to the standards set forth in
subsections (c),'4)e and. f of this sec-
tion.
d. !h/Iotor vehicle special~y service sta-
tions.
e. Loading areas/overhead doors when
located in front yards.
f. Class I restaurants.
(e) Ad~t:lon~i s~andards. The following addi-
tional standards apply in the BP district:
(1) Loa~Jn,~ spaces an.~ ouer,Cea~ doors.
a. Loading spaces/overhead doors shall
be located in designated rear yards
and secondarily in designated side
yards. Loading areas/overhead doors
shall not be located in designated
front yards unless approved as a
conditional use.
b. Loading spaces and overhead doors
shall be desi~ned to be compatible
with the principal building. Architec-
tural techniques and landscaping
shall be employed zo reduce visual
impacts from adjacent properties and
roadways.
(2) Dura, ps,ers an, d re?~;se en. cios~res.
a. All dumpsters shall be completely
screened from public 'dew by using
enclosures constructed of similar ma-
terial as the principal buiidin$'.
b. P~efuse enclosures shall include .gates
and be located in designated rear or
side yards.
o Roo/rop or g'rou.,~m dcc?','c'~/ ega:ip~?zsnt.
signs.
a. ,an utility equipment shall either be:
i Screened fi'om the eye level view
of adjoining properties by use
of' exterior walls anch'or land-
scaping;
Supp N~, i CD30:!,39
30-2294 ELI{
4)
2. Painted :o match or compte-
men~ the buiidin~
or
3. incorporated into an architec-
tural deskzn, as apprm~ed by
the building and zoning admin-
istrator.
b. NotwiZhstandin~ the provisions of
subdivision II of dRffsion 5 of this
arnde, :he following requirements
regardinz si~aze shall be met:
!. .~l ~eeszandinff silage shall
be of a monument style si~
and have a maximum size of 64
square feet and height of eight
feet.
2. One on?remises business wall
si~ per occupancy, not to ex-
ceed two square feet in si~
area for each linear foot of the
b~lding frontage up to a max-
imum of 128 square feet per
occupancy, is permitted.
~c~er~or buiZdin~ finfshes.
a. It is the intent of the city to promote
and encourage high standards of cre-
ative architectur~ desi~ in the busi-
ness park district.
In the business park zoning district,
the following are acceptable building
mate~ais and finishes:
1. Brick.
2. Natural or cut stone.
3. Intently colored split face (rock
face), b~nished, or glazed con-
crete masonry unk.:(excludin~
plain or painted).
lnte~ally colored and exnos~d
....... p~ ..... ~ concrete Dan-
els (excludin: si~e-T or do~-
Dallels. O12]~l encolored,
or raked finish ~
5. O}ass. aruhiteczura] metal,
be~'v~s~.=,~. ~ and aluminum, pro-
vialed such sane!s are factory
fabricated and finished with a
durable nonfade suzqace and
resistant desi._~n.
6. Stucco, E.i!.S, and other
cemenziuous coatins
7 Wood: proxdded the surfhces are
~sn~ ; ; ~ for exte!ior use or wood
of proven exterior durabi!it! is
used, such a .... dar redwood.
and'or clorets.
S. Other materials determined as
acceptable by the planninE de-
parzment.
Ndajor extehor sux%ces that are ad-
jacent to any public street, public
traiNpath~ er adjacent residentially
zoned properties shall be of one of
the acceptable materials and shall
be combined wish at least SO percent
of one or more a~ut~bie materials,
or with 40 percent 'punched open-
~= with or without zlass (or as
much as ailewed by the ~niferm
BuildinE Oode: whichever is less),
neither of which are ~o be concen-
trated in any one location, unless
accentuate a desi~ feature. Major
emperor s~aces that are ~dsible ~om
but nor adjacent to any public street,
public traiP'path, or adjacent residen-
t~ly ton,ed properties shall be con-
sidered tr~si~ion walls ~d may have
less ~han the SO percent comb{nation
or les~ than 40 percent punched open-
inet, but eiZher shall net be reduced
to zero mercentL Reductions belo~
20 percent shall require staff
preval. Such walls shall be screened
from view with additional landscap-
ing. The requirement to have at least
30 percent of one or more acceptable
in8 dock w~li.
Major exterior suriices that are ad-
~acen~ to any oubiic street.
trail/oath, or adjacent, residentialN
zoned properties shall not exceed
160~f==+ ~=~o inches in ienz~h with-
out a n~imum four-foot depth change
L.~kWD DEVELOPMiENT REGULATIONS
(recesses, prozrusions~ or a dombina-
;ion thereo~, with az leas; two feet of
such change to be in the entire height
of the facade.
e. A]zernamvely. exterior w~l] surfaces
are zo be desi~ued wi~h architectural
in;eresz sbn'ousin multiple desis'n ~ech-
niques such as. buz noz limited no~
archi;ecvural forms, reveais~ tex-
tures~ cornice ,denai!ins._. cn~n=~4 ~, a~ in
surface planes., color, punched open-
in~s and/or chanEes in parape~ ele-
va;ions. The use of desiEn tech-
niques alone or lower percentage of
addi~onal acceptable materials noted
in subsection /e/(4ic of ~his sec;ion
shall require size plan review and
approval bp' ~he city planning corn-
mission.
£ The building shall be desigmed so as
to prevent Zhe appearance of straight,
anbroken lines in the horizontal and
vertical surfaces.
Main entrances shall be emphasized
wi~h a complementary material which
is difi%ren~ from the primary build-
ing material.
h. Garage doors shall have a color that
matches or coordinates wi~h the
building's primary body color.
i. The building shall be desip, ed to
screen equipment located on :he roof
of the buildin=~. Alternatively, such
equipmenz shall be located in such a
manner so that iz cannot be seen
from ;he adjacent public ssreet, pub-
lic path/trail, or adjacent residen-
tially zoned property at the same
elevation of the fi:'s~ floor of the
0U!lCI~ng.
(.5~_ LsnSscap~.~. No~wl~h~an.iin~~ ~ ~ ._= the provi-
sions of subdivision IY of division S of vhis
~r:icie: the Sllewim~ requiremenzs shall
he met:
a. 0f the Lota] nmnber of overstor~
Zrees required: a minimum of
percent shall be ornamental zrees
and 2S percen~ shall be conifer trees.
b. A landscaping credit of up to
percent mas be Wen to a site plan
which contains exterior sculptures,
founzsins, ponds beyond those
quired for svorm ~aina~e and other
site enhancements as approved
zhe buildins and zoning administra-
tor.
c. Under~ound inisation shat] be
st~led wishin the front Nard and all
landscaped areas a{acent to a pub-
lic right-of-waN
(Code i982: ~ 800..!2{!6)~ Ord. No. 00-1i: ~
6-19-2000~ Ord. No. 00-16, ~ !--3,
Ord. No. 0i-i8, ~ 1, $-20-200!~ Ord. No. 02-0!: ~
i-22-2002; Ord. No. 02-04, ~ 2,
Editor:s no~e--A~ ~he city's request addizional material
was added to smbseczion S0-i294(c}(7) which exp~nded :his
subsec:ion wizh a., b.
Secs. o0-1=9o--o0-1o~0. ~eserved.
~CD~
ELK RF~E?~ r- ~ =
or- ~ o ~. ~rincipa~ structures.
~nc~a~ structures shall com~]v. ~ ~,',.t..,~ the followin~ a~mens~ona~ re~lamons:
£o~ ~e-
g;~ :~ re- £ro~zt
I-I: I acre 30
100' width
I-2.: 1 acre 30
I00' width
1 Va acres
25 20
25 20
~0
f~_ BPi 35
: Must hook up to city sewer and water if within the ci:y sewer district.
(Code 1982, § 90O.iS{1))
Lot Cover-
~0%
40%
40%
Sec. 30-1312. Accessory structure setbacks.
Accessory structures shall comply with the following dimensional re$~ulations:
Front Set- Side Set- P~e~r Set- ./l~a::Dn:zrn
back bach bacic ~eizht Fezzces
D~strict (feet) (feet~ (feet) (feeO (feet.)
!-! 30 10 10 40 0
i-2 30 10 10 60 0
(Code 1982, ~ 900.18(2.))
Secs. 30-1313--30-1561. Reserved.
DFvlSiON 9. OTHER '~ N ~ x;
N O_ 0 v,RLA~
DISTRICTS
S:~bdh.,~smn I. In Oener~Z
Sec. 30-1562. A-1 agricultural conservation
district.
(ai ?u.:?ose. The a~'icuiturai conse.~,~at~on dis-
trJcz is established for :he purpose of preser-~dng~
promoting, maintaining: and enhancin~ the use of
!and ~br commercial a~icutZura] purposes, to pre-
vent scattered and leap-fro~ nonfarm ~owzh. and
to protec~ exoenditares for such oubiic sero'ices as
roads and road maintenance~ and police and fire
protecnon.
(b} PermitZeS asea Permitted uses in the A-1
district are as follows:
(1) A=~ricultural uses (five-acre minimum lot
size}.
(2~ Public parks, playg-rounds and open space.
{3) Facilities for flood and erosion control.
(4) Horticultural uses.
{5:~ Golf courses and country clubs.
(6! Single-family dwellings.
(7) Model homes in compliance w~,zh secmon
o0-o00.
Licensed day care facilities for !2 or fewer
children.
Supv. No. '2 C:~ 30:!42
CITY OF ELK RIVER
TAX REBATE FINANCING PROJECTION WORKSHEET
Project Name: Orluck Industries Expansion/Relocation
TRF Project: 20,000-sq.ft. light manufacturing facility, located on 2.79-acres
Assumption: Projection is based on estimated payable 2004 tax rates and estimated project market value.
The Project will be assessed upon actual tax rates and market value in the year following construction.
State Class Rate
Up to $150,000
Over $150,000
Tax Capacity Rate
City Portion
County Portion
School District Portion
State Portion
Other Jurisdictions*
Total Tax Capacity Rate
0.015
0.020
0~43734
0.44363
0.32709
0.54447
0.03559
1.78812
ASSUMPTIONS
Pay 2004
Pay 2004
Pay 2004 est.
Pay 2004 est.
Pay 2004 est.
Pay 2004 est.
Pay 2004 est.
Pay 2004 est.
Land Value .!:$ :.;;;
Building Value
Total M ark et Value ¢¢; ;?:: ~;,;;2 ~2
MAX Years of TRF Project
Property's Total Tax Capacity $ 23,504.00
$1.75/sf for 2.79 Acres
$50/sf for 20,000-sqft
City Portion $ 10,279.24
County Portion $ 10,427.08
School District Portion $ 7,687.92
State Portion $ 12,797.22
Other Jurisdictions $ 836.5I
Total Estimated Real Estate Taxes $ 42,027.97
[County 1/2: $100,760.00 101
Cost = $I .66/sf
*Amount of abatement will vary depending on market value, tax rates, class rates, construction schedule and inflation on MV.
*includes City HRA, City EDA, County HRA, County Rait Authority
*Does not include Market Value School Excess Levy Referendum 2003 rate of 0.07597%
FILE:orluckTRF.xls 1/26/2004