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7.2. PCSR 06-25-2019 Request for Action To Item Number Planning Commission 7.2 Agenda Section Meeting Date Prepared by Work Session June 25, 2019 Zack Carlton, Planning Manager Item Description Reviewed by Warehouse Uses in the Business Park Zoning Chris Leeseberg, Senior Planner District, Case No. OA 19-06 Reviewed by Action Requested Discuss a proposed ordinance amendment to expand warehousing opportunities in the Business Park zoning district. Background/Discussion The City Council, after having received a request from a property owner, has directed city staff to review a possible ordinance amendment that would expand warehousing opportunities in the Business Park (BP) Zoning District. Warehousing is currently allowed as a permitted use without size limits in the I-1 (Light Industrial), I-2 (Medium Industrial), and I-3 (General Industrial) zoning districts. The BP and certain FAST District subzones allow warehousing as a permitted use when the area dedicated to the use is below 50% of the total building floor area, and as a conditional use for up to 65% of the total building floor area. The current warehouse limit for the BP district was adopted by the City Council January 22, 2002, and was an increase from 30%. The concerns with the limit at that time, restricted leasing opportunities and desires for more warehousing from the business community, are the same as today. The City Council discussed the increasing transition to online sales, reducing the need for storefront and office space and increasing demand for warehousing. They also discussed the goals of the BP district to create jobs in an industrial setting with higher design standards and the concerns of increased truck traffic that may result from increased warehousing. Please consider the pros and cons of a possible ordinance amendment and what increase to the warehousing limit may be appropriate. Financial Impact N/A Attachments  Planning Commission and Council Minutes History  January 22, 2002, Staff Report to Council The Elk River Vision A welcoming community with revolutionary and spirited resourcefulness, exceptional service, and community engagement that encourages and inspires prosperity Planning Commission Minutes October 23, 2001 Page 11 Chair Pederson stated that he felt some level of finishing is needed for the showroom space. He stated he would not support the ordinance amendment at this time. He suggested looking at what other cities are doing regarding office/warehouse space, such as Minnetonka, Plymouth, the Carlson Complex along 494, or Champlin for some comparison. Chair Pederson stated that he felt it was important to look at the amount of warehouse space that is actually needed, and whether or not this is an appropriate use in a business park. COMMISSIONER BAKER MOVED TO TABLE THE REQUEST BY THE CITY OF ELK RIVER FOR AN AMENDMENT TO THE BUSINESS PARK DISTRICT STANDARDS, CASE NO. OA 01-09. COMMISSIONER FRANZ SECONDED THE MOTION. THE MOTION CARRIED 4-0. 5.7. Request by the City of Elk River to amend the Comprehensive Plan to Include Certain Property in the Urban Service District Scott Harlicker stated that the City of Elk River requests an amendment to the Comprehensive Plan to include approximately 80 acres located on the south side of 175th Avenue and east of Twin Lakes Road in the Urban Service District. Mr. Harlicker explained this request prompted by discussions during the review of the Klein property for extension of water and sewer. Mr. Harlicker reviewed the existing conditions, current zoning and land uses, and proximity of the area to the current Urban Service District. Staff recommends approval of the land use amendment based on the findings listed in the staff report. Chair Pederson opened the public hearing. Jerri Graham, 17451 Tyler Street, asked that the Planning Commission recommend denial of the request. She felt that the 8 properties are well-established and that there was no documentation made available to them when they purchased their property that the zoning would be changed. Ms. Graham stated that the character of the neighborhood is somewhat a nature" oasis" and made a better gateway to Elk River than high density. She stated that the school district cannot keep up with the higher density that keeps coming. She felt that the Commission has an opportunity to slow down growth. Ms. Graham stated that the properties in question were not developed with future subdivision in mind and many have livestock. Ijaz Osman, 10616 175th Avenue, stated that feels like he is stuck and that he has no control over what is being decided for his property. He stated that he did not wish to move but if his property is included in the Urban Service District, he will be forced to sell. Mr. Osman asked what is happening with the North Star Corridor project. Mr. Harlicker explained that proposal for federal funding was approved, and that they will be going to the state for funding this year. Mr. Osman stated that he felt if Cargill has no plans for development, that this area should be able to remain rural, as well. He felt this is an example of where "City and Country Flow Together" as the City's motto states. There being no further public comment, Chair Pederson closed the public hearing. Commissioner Baker asked what it will mean to the property owners to bring the property into the Urban Service District at this time. Mr. Harlicker stated that it would mean water and sewer would be made available and the property owners would be assessed. Terry Maurer eXplained that if the City Council approved including the property in the Urban Service District, they would likely establish a time frame such as the 2007 date was set for Planning Commission Minutes December 18, 2001 Page 2 Commissioner Baker stated he did not have a problem with the request. Chair Pederson stated he also did not feel that significant screening was required and that 3 foot trees would be adequate. COMMISSIONER BAKER MOVED TO RECOMMEND APPROVAL OF THE REQUEST BY BART BOESE FOR A CONDITIONAL USE PERMIT FOR A HOME OCCUPATION, AND OUTDOOR STORAGE OF EQUIPMENT RELATED TO THE BUSINESS, CASE NO. CU 01-38, WITH THE FOLLOWING CONDITIONS: 1. PROVIDE AN IMPROVED SURFACE, SUCH AS CLASS-5, ASPHALT OR CONCRETE, FOR THE OUTDOOR STORAGE AREA. 2. IF MORE THAN 3 PIECES OF EQUIPMENT, ASIDE FROM THE TRUCK AND TRAILER, ARE TO BE STORED OUTSIDE, THE APPUCANT SHALL APPLY FOR AN AMENDMENT TO THE CONDITIONAL USE PERMIT. 3. PROVIDE ADDITIONAL SCREENING BY PLANTING 3-FOOT TALL CONIFEROUS TREES, AT 15 FEET ON CENTER, ALONG THE NORTH PROPERTY UNE FROM THE FRONT OF THE HOUSE TO THE REAR UNE OF THE POLE SHED. COMMISSIONER MESICH SECONDED THE MOTION. THE MOTION CARRIED 5-0. 5.2.Request by City of Elk River for an amendment to the Zoning Ordinance Section 900.12(16) Business Park District, relating to warehouse space, Public Hearing - Case No. OA 01-09 Staff report by Michele McPherson. Ms. McPherson reviewed the proposed ordinance amendment which was reviewed by the Commission at their October 23rd meeting. She noted that the Commission directed staff to research other cities' ordinance and to solicit comment from key industrial brokers. Staff received no comment from the industrial brokers. In reviewing information from other cities, staff found that no city limited the amount of warehouse space. Trucking terminals that are primarily warehouse uses were found in heavy industrial zoning districts, while light industrial and business park districts allowed manufacturing and warehousing as permitted uses. Ms. McPherson stated that the EDA has no concerns with the ordinance amendment, and staff recommends approval of the proposed language. Chair Pederson opened the public hearing. Rick Martens, Brookstone, Inc. , stated that he does not intend to build pure distribution warehouse and that the City's ordinance prohibits truck terminals in business park districts. He felt the City's recently-adopted business park building standards will prevent the City from getting the types of businesses they do not want. Mark Huus, AmCon representative, reviewed photographs of office/warehouse, office/showroom, manufacturing and distribution buildings which AmCon has constructed in the Twin Cities area. He felt that the Commission would agree that these are attractive Planning Commission Minutes December 18, 2001 Page 3 buildings. Mr. Huus eXplained that many of these buildings would not be allowed by the City's ordinance, or would at least require a conditional use permit, due to the amount of warehouse space. Jeff Gongoll, President of the Economic Development Authority, felt the ordinance amendment proposed is a good compromise and that it supports the EDA's mission statement to provide jobs and tax base for the City. He felt the ordinance provides the mechanism to market and promote the City of Elk River and asked that the Commission support staff's recommendation for approval. There being no further public comment, Chair Pederson closed the public hearing. Commissioner Baker thanked Mr. Martens for his input in the ordinance amendment process. He asked if the Commission felt they need to address the ceiling height. Ms. McPherson stated that the current ordinance does not regulate the ceiling height. She stated that the ordinance would not allow a pure distribution use in the business park zoning. She also noted that if a prospective tenant wanted more that 50 percent warehouse space, the Commission would review the request through the conditional use permit process. Chair Pederson stated that he was comfortable with the proposed ordinance amendment. Commissioner Baker stated that he felt the changes were in line with the purpose statement of the existing ordinance. COMMISSIONER BAKER MOVED TO RECOMMEND APPROVAL OF THE REQUEST BY THE CITY OF ELK RIVER FOR AN AMENDMENT TO THE ZONING ORDINANCE SECTION 900.12(16) BUSINESS PARK DISTRICT RELATING TO WAREHOUSE SPACE, CASE NO. OA 01-09. COMMISSIONER ROPP SECONDED THE MOTION. THE MOTION CARRIED 5-0. 6.Other Business 6.1. Update on 12/17/01 City Council Meeting Commissioner Schuster provided an update on the December 17, 2001 City Council meeting. 8. Adiournment There being no further business, COMMISSIONER MESICH MOVED TO ADJOURN THE MEETING. The meeting of the Elk River Planning Commission adjourned at 7:15 p.m. Respectfully submitted, Debbie Huebner Recording Secretary City Council Minutes January 22, 2002 6.5. Page 10 10. THE PARK SURVEY INFORMATION SHALL BE PROVIDED IN THE REQUIRED ELECTRONIC FORMAT. 11. UPON COMPLETING ALL OF THE IMPROVEMENTS AND HAVING THEM ACCEPTED BY THE CITY, A WARRANTY BOND IN THE AMOUNT OF 25% OF THE IMPROVEMENT COSTS SHALL BE SUBMITTED TO THE CITY FOR THE PERIOD OF ONE YEAR. 12. SURFACE WATER MANAGEMENT FEE IN THE AMOUNT REQUIRED BY THE CITY AT THE TIME OF FINAL PLAT BE PAID PRIOR TO RELEASING THE PLAT FOR RECORDING. 13. A GRADING AND EROSION CONTROL PLAN BE APPROVED BY THE CITY ENGINEER PRIOR TO THE ISSUANCE OF BUILDING PERMITS. 14. A DEVELOPMENT PLAN BE APPROVED BY THE CITY ENGINEER PRIOR TO THE ISSUANCE OF BUILDING PERMITS. 15. ALL GRADING BE CERTIFIED PRIOR TO THE ISSUANCE OF BUILDING PERMITS. 16. A TREE PRESERVATION PLAN'BE APPROVED PRIOR TO RELEASING THE PLAT FOR RECORDING. 17. ANY TREES OFF SITE OR ON SITE, NEAR THE LIMIT OF GRADING THAT ARE TO BE PRESERVED, SHALL BE FENCED WITH A SNOW FENCE AT THE DRIP LINE TO PREVENT GRADING, COMPACTION, OR STORAGE OF EQUIPMENT; DEBRIS OR MATERIALS. STAFF SHALL INSPECT FENCING PRIOR TO GRADING COMMENCING. 18. A TRAIL CONNECTION BE PROVIDED FROM 176TM CT. TO OUTLOT A. 19. PARK DEDICATION SHALL BE MET BY DEEDING OUTLOTS A & G TO THE CITY FOR PARK PURPOSES. COUNCILMEMBER KUESTER SECONDED THE MOTION. THE MOTION CARRIED 3-0. Request by City. of F.11~ River for an Amendment to the Zoning Ordinance Section 900.12 16) Business Park District, Relating to Warehouse Space, Pubhc Hearing - Case No. 01-09 Staff report submitted by Director of Planning Michele McPherson. Ms. McPherson stated that the city would like to amend the Business Park District standards to establish definitions for warehousing and showrooms and to allow showroom space, repair/equipment, and increased warehouse space as permitted. Mayor Klinzing opened the public hearing. There being no one to speak to this issue, Mayor I4dinzing closed the public hearing. COUNCILMEMBER TVEITE MOVED TO APPROVE ORDINANCE 02-01 AMENDING SECTION 904 OF THE CITY CODE OF ORDINANCES. City Council Minutes Page 1 Janua~ 22, 2002 COUNCILMEMBER K-LTESTER SECONDED THE MOTION. THE MOTION CARRIED 4-0. 7.1.Planning Commission Recommendation: Comprehensive Plan Update Michele McPherson updated the Council on the process the Planning Commission used to decide how the Comprehensive Plan would need to be reviewed and the process that should be followed for review of the Plan. The City Administrator noted that this issue would be discussed at a joint meeting between the Planning Commission and the City Council on February 4, 2002. Additionally, he noted that staff strongly believes that there is a need for a planning consultant to assist in the updating process. An objective third party that knows in the public input and review process and which has planning expertise would gready assist the city. The City Council concurred with the need for a planning firm to assist in the updadng of the Comprehensive Plan. The Council discussed Rusty Fifield joining the Hoisington Koegler Group Inc. planning fu:m and indicated that is was appropriate to have Rusty briefly discuss the furms experience when he attends that January 28, 2002 meeting and that he should be invited to attend the February 4, 2002 meeting in order to formulate a proposal for services. Councilmember Tveite volunteered to sit on the Comprehensive Plan update committee. Council_member Mot_in expressed interest in serving as an alternate. 7.2,Cable TV Council_member Motin stated that he has received some complaints from citizens regarding some new higher fees that Charter CommUnications is imposing. He questioned whether outside competition would be allowed to come into Elk River. City Administrator Pat Klaers stated that the City Clerk is a representative on the Cable Commission and she will discuss this situation at a future meeting. 7.3 Announcement Councilmember Kuester stated she is a member of the Citizens League and that the League would be providing information on a leadership study that they recently completed. She stated that the study would be presented at the Elk River Public Library on Saturday, February 9, 2002, from 9:00 a.m. to 11:00 a.m. and everyone is invited to attend. 8. Staff Updates There were no staff updates. 9. Adjournment There being no further business, Mayor Klinzing adjourned the meeting of the Elk River City Council at 9:20 p.m. Tina Allard Recording Secretary Tuesday, October 02, 2001 Ms. Catherine Mehelich Dkector of Economic Development City of Elk P, iver 13065 Orono Parkway PO Box 490 Elk River, Minnesota 55330 BROOKSTONE, 1NC. 7400 Metro Blvd., Edina, M~nnesoXa 55439 6 I2,837.9167 phone 612.837.8010 fax Dear Cathy: Furtller to numerous discussions with the City of Etk River's planning director, Michele McPherson, and our scheduled appearance before the EDA of the City of Elk River on Monday, October 8~, I am writing this letter to state the position of the Elk River Business Park owners with regard to the proposed modifications to file permitted and condition~ use sections of the B-P Business Park District. Our response to date has been based upon concerns we have had with the limitation on the amount of warehouse space in our office/warehouse buildings. We appreciate the opportunity to work together with you on this issue and to present our point of view to various approval groups. While we clearly understand the City's deske to maximize job growth and job opportunities within the city, from the very beginning, we envisioned both build-to-suit and multi-tenant office/warehouse buildings. While not in any way a fu'm plan, a conceptual plan showing buildings ranging from 30-60,000 square feet were laid out in the various parcels as we worked our way through the approval processes. Throughout the Twin Cities, office/warehouse buildings are a mix of, to one degree or another, finished and unfinished spaces. The finished spaces and these are generally all permitted uses under your zoning by4aws, include offices, showroom and laboratory and other highly finished work areas. The unfinished areas, that is the warehouse portion of the office/warehouse term, include pure warehousing and distribution, shipping and receiving facLlities, light manufacturing, repair and maintenance, vehicular storage, and research and testing. On some occasions, the unfinished area is upgraded to include air conditioning, a higher level of lighting, etc. and in some cases, whether for manufacturing or warehousing, is left in a more warehouse form. While manufacturing is generally a part of most business parks, given that approximately 16% of overall employment in this Country is accounted for by the manufacturing sector and given further the significant amount of manufacturing that has moved overseas, the dominant use in the unfinished portion of office/warehouse buildings is not manufacturing but ati of the other industrial uses mentioned above. The finish percentages for office and showroom spaces are generally higher in locations within close proximity to downtown areas and major metropolitan landmarks suSh as airports, major shopping facilities, and also at locations having some commercial aspect to them. This location does not offer the proximity to major landmarks but it does have a commercial aspect to it given the exposure of at least some portion of tile buildings to highway 169 together with the adjacency to the retail development to the north. However, generally, the kinds of office/warehouse buildings envisioned for this location would not be finished greater than 25-40%. This leaves 60-75% of unfinished space and our concern is with limiting the use of this space in such a manner that we are unable to effectively market this properts,. Also, these are aggregate numbers. In individual tenant spaces, unfinished areas will range from 0 to 100%. We have always felt that your building codes could much more effectively regulate the issues at hand and meet your goals by requiring some 'kind of public hearing approval for buildings that are clearly designed as distribution buildings. For example, our fu'st building is an 18' clear height with bay sizes of less than 5,000 square feet. Tile NAIOP definition of distribution is far outside those parameters. A distribution building would be in the clear height range of 24'-32' and have bay sizes ranging from 8-15,000 square feet with much greater depth than our first building has or that we anticipate having for other future buildings. If you deem it necessary to place percentage limitations on the amount of warehouse space, then we would request the following: We would like to see tile 50% limitation on warehouse space be viewed in aggregate for any particular building rather than on an individual tenant basis. This would allow more flexibility on our part with regard to marketing and indMdual tenant negotiations. The goals of the City would simply be established and achieved on an overall square footage basis rather than on an individual square footage basis. We would also like to raise the maximum percentage of warehouse allowed under the conditional use section from 65% to a higher number and simply not preclude an approval, for example, of a build-to-suit for a company that Elk River desires to attract to its community and under a specific percentage limitation would be precluded from doing so. We have written this letter in the spirit of working together with the City of Elk River in a positive and collaborative manner based upon the intent established when the development agreement was first negotiated and entered into. Our requests, we believe, do not deviate from those goals and are more in synch with market in general and also for this site, specifically. We are hopeful of a positive response when we meet before the EDA on October 8~' and subsequent meetings with the planning commission and city council. If any additional information is required, please call me. ry truly, R/chard V. Martens President RVM/bb Cc:Michele McPherson - City of Elk River Jim Winkels - Partner, Elk River Business Park, LLC Liza Robson - Partner, Elk River Business Park, LLC Tony Gleekel - Siegel, Brill, Greupner, Duffy & Foster, P. A. iii. Public shelters and essential services iv. Retail Sales provided the following conditions are met: a. The retail sales activity is not located in an administrative office facility, but is located within a business, the principle use of which is not commercial sales. b. The retail sales activity shall not occupy more than fifteen (15%) of the gross floor area, or a maximum of 5,000 square feet of the occupied quarters, whichever is less. c. The retail sales activity is related and subordinate to the principle use. d. No sign identifying or promoting that retail sales occur within the building shall be visible from outside the building. C. Conditional Uses: i. Conditional uses allowed when the underlying land use is light industrial: a. Any permitted use which involves more than 30% warehouse space b. Vocational, technical and trade schools c. Loading areas/overhead doors when located in front yards d. Above ground storage tanks ii. Conditional uses allowed when the underlying land use is highway business: a. Hotels and motels b. Licensed day care facilities c. Retail shops and stores which compliment and serve the Business Park subject to the standards set forth in 2(j) below. d. Motor vehicle specialty service stations e. Loading areas/overhead doors when located in front yards a. Hotels and motels b. Licensed day care facilities c. Retail shops and stores which compliment and serve the Business Park subject to the standards set forth in 2(j) below. d. Motor vehicle specialty service stations e. Loading areas/overhead doors when located in front yards f. Multiple tenant buildings g. Restaurants (Class I) Warehouse space shall mean the space ~sed for storin~ merchaNd, ise cor~nodities. The area occupied b,~' the ach of ship?inq o~{. receivi'.'~,~ merchandise shall_ not be Jnc].nded i~ the floor ,a~.ea ,'.~,~-iicuiatior~ f~r warehouse space. Office/Showroom space shai! nLean SP~Ce ~Na~ i'.~ ~Ni~Jiixed primarily the display of products mannfac'i' ire i. ~uch space may o~'~ '~2_ay ~'~ot be finished.