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HomeMy WebLinkAbout04.17.23 EDA Minutes City of Farmington Economic Development Authority Regular Meeting Minutes Monday, April 17, 2023 The Farmington Economic Development Authority met in regular session on Monday, April 17, 2023, at 5:30 p.m. at Farmington City Hall, 430 3rd Street, Farmington, Minnesota. 1. CALL TO ORDER Chair Wilson called the meeting to order at 5:30 p.m. 2. PLEDGE OF ALLEGIANCE After some discussion on whether the Pledge of Allegiance should be recited or only when the EDA meeting is a standalone, the Commission agreed that it should be continued, and the Pledge of Allegiance was recited. 3. ROLL CALL Members Present: Chair Steve Wilson Commissioners Holly Bernatz, Joshua Hoyt, Nick Lien, and Katie Porter Members Absent: None Also Present: Lynn Gorski, City Administrator Julie Flaten, Asst City Administrator/HR Director Deanna Kuennen, Community Development Director Stephanie Aman, Economic Development Coordinator Chris Regis, Finance Director Kellee Omlid, Parks & Recreation Director John Powell, Public Works Director Gary Rutherford, Police Chief Shirley Buecksler, City Clerk Kara Hildreth, Editor— Dakota County Tribune 4. APPROVE AGENDA Motion was made by Commissioner Bernatz and seconded by Commissioner Porter to approve the agenda, as presented. Motion carried: 5 ayes / 0 nays. 5. CITIZEN COMMENTS No one addressed the Commission to speak. Economic Development Authority Minutes April 17, 2023 Page 2 of 6 6. CONSENT AGENDA 6.1 Economic Development Authority Meeting Minutes of March 20, 2023 6.2 Monthly Financial Statement Motion was made by Commissioner Lien and seconded by Commissioner Bernatz to approve the Consent Agenda, as amended. Motion carried: 4 ayes / 0 nays. 7. PUBLIC HEARINGS There were no public hearings. 8. DISCUSSION ITEMS 8.1 Introduction — Economic Development Coordinator Director Kuennen introduced Stephanie Aman as the City's new Economic Development Coordinator. Coordinator Aman provided some details for the Commission on her background in marketing and public relations and how it ties in nicely with economic development. There are a lot of opportunity in Farmington for economic development, and she is excited for this opportunity. 8.2 EDA Levy Discussion Currently, the EDA does not have a dedicated funding stream. Minnesota Statutes gives authority to the EDA to request a dedicated tax to support broad economic development goals. Minnesota Statutes regulate the process to request a levy, as well as the maximum levy amount for an EDA. The FDA's budget is funded by a direct appropriation from the City. Since 2019, the allocation to the EDA to support economic development efforts has been between $40,000-$50,000 annually. This funding is used to support the operations - including memberships, equipment, developer payments (grant programs), and program expenses. The EDA also has a small fund balance that has been built up over time. In 2022, $30,000 of the fund balance has been allocated to balance the budget. Limited funding impacts the City's ability to pursue certain economic development activities and the ability to offer certain programming. Staff is recommending that the EDA request an EDA levy as part of the 2024 budget process. State statutes provide the authority to request a levy. The EDA, itself, does not have the ability to implement a levy, but the EDA may ask the City Council to institute a tax for the benefit of the EDA. Staff has worked with Chris Regis, Finance Director, to calculate what the EDA could have requested for a levy in 2023, based on the City's taxable market value and how that would have impacted the overall city levy. The following table Economic Development Authority Minutes April 17, 2023 Page 3 of 6 illustrates the current scenario of zero EDA Levy, through a full EDA levy as allowed by statutes (0.01813% of the City's taxable market value), and the increase it would have on the overall levy: 2023 TAX LEVY WITH EDA LEVY Local Levy EDA Levy Total Local Levy Increase Zero EDA Levy $12,749,859.00 $- $12,749,859.00 5.96% - EDA Levy $12,749,859.00 $100,000.00 $12,849,859.00 6.79% 0.83% $200,000 $12,749,859.00 $200,000.00 $12,949,589.00 7.62% 1.66% EDA Levy $300,000 $12,749,859.00 $300,000.00 $13,049,589.00 8.45% 2.49% EDA Levy $400,000 $12,749,859.00 $400,000.00 $13,149,589.00 9.29% 3.33% EDA Levy Full EDA $12,749,859.00 $524,615.00 $13,274,204.00 10.32% 4.36% Levy Staff is recommending that, as part of the 2024 budget, the EDA requests a levy along with the standard direct appropriation that the EDA is currently receiving. Additional funding will allow the EDA to create different/additional programs, enhance marketing and outreach efforts, and pursue a more comprehensive economic development strategy based on outcomes from the community vision initiative. Specific uses of the funding have not been identified yet, which is why Staff would recommend starting with a $100,000 levy in year one. Discussion included: • Knowing this conversation is about funding for 2024, there are seven months to plan. What are the actionable items? What are the short-term action items? What type of increase are we looking at for the general levy for 2024? To what degree are we going to allocate dollars to an EDA levy? Would rather look at action items than driven on amount of money. Spend time on what we're going to do. • The budget tells a story of how we're going to serve our residents. This is how we are being wise with money. • Do we know what our obligations are? o Administrator Gorski has asked Staff to put together our current obligations. Directors Kuennen and Regis have had multiple discussions on this, and Staff feels comfortable with $100K. We can Economic Development Authority Minutes April 17, 2023 Page 4 of 6 do things with Staff that we haven't been able to do before. The main goal is to establish the fund and move forward from there. • Commissioner Hoyt said he personally struggles with how we are comfortable with $100K if we don't know how we are going to spend the $100K already in the EDA budget. It's almost like trying to work backwards. o Director Kuennen said economic development is always going to be on its own timeline. We can take the work plan and work it backwards. We can also have Ehlers come in and present to the EDA. Without funds, you miss those opportunities. If we spend down each year but don't build up those funds, we won't be able to take on those bigger projects. It becomes a tool that we can use and continue to build. • Commissioner Hoyt said it's a challenge to get uncomfortable and be able to ask for enough. Let's have a bold plan to sell to the community, on what those actions are. • Commissioner Porter said she struggles with the word `levy.' She appreciates everything Staff has done. Where do we go with these things? She also struggles with the general levy going up for our residents. We need commercial tax base to level things out and the burden to taxpayers, but that will take a long time. She is open to the idea of an EDA levy but needs to do more research on her own and familiarize herself with what the idea looks like. • Commissioner Bernatz said she feels the opposite and closer to Commissioner Hoyt's comments. You have to spend money to make money. We've seen decades of no forward movement and an EDA with no structured funding source. She believes it's necessary for commercial development. We need to allocate funds in front of potential opportunities. She suggests a similar plan; one with how the money you're asking for will be spent. • Commissioner Lien asked about the benefit of keeping the fund transfer versus the levy. If it's the process of getting it established, why not go for the amount of the transfer? o Director Regis said there is no difference between a transfer or a levy. o Director Kuennen said the levy can be any dollar amount, as long as it falls within State Statute. • Commissioner Lien asked what the various price breakdowns will get you. He is comfortable with $100K. o Director Kuennen said they have a work plan and can put some more specific tasks to it and bring it back. We can do more if there is funding available. • Commissioner Hoyt said things are going to happen in the next 18 months. If we do not have a funding source, we will run into another roadblock. I challenge us to think about what it looks like to go for $500K. • Commissioner Bernatz suggested going for the real ask, not the safe amount. We will figure it out from there. She feels the safe ask is dangerous because we don't know what's coming up. Economic Development Authority Minutes April 17, 2023 Page 5 of 6 • Chair Wilson asked the Commission for their direction. Is this a good step to take forward? He said he is in agreement that you arrive with the amount you want to move forward with. If we move forward, he suggests not continuing with the transfer, as it's not accountable to the taxpayers. Start the levy at $200K. He would rather pick a higher amount and delete that transfer. o Director Kuennen said the transfer would go towards operating costs and the levy would go to things people get excited about. • Chair Wilson said he feels strongly in favor of this and also respects Commissioner Porter's point. We need to protect our taxpayers and keep them first in mind. He strongly supports the levy and the transfer that pays the operational costs. He feels $100K is too low. Additional money could sit in escrow. Staff can come back with the right number and why. o Director Kuennen said we will build that out with an appropriate number that tells the story. 8.3 Marketing Proposal — Minnesota Vikings Official 2023-24 Yearbook In January, the EDA agreed to reallocate a portion of the budget for marketing ($30,000). Staff has been seeking opportunities to leverage these marketing dollars to have a significant impact. Staff is recommending using a portion of the marketing budget for print and online ad space as part of the Minnesota Vikings Official 2023-24 Yearbook. The Minnesota Vikings Yearbook is a souvenir publication that is available inside US Bank Stadium for home games and is featured on the Vikings website. A limited number of EDA's and Convention and Visitor Bureaus have an opportunity to acquire ad space within the publication. The publication helps promote Minnesota cities, with the potential to reach millions of fans and members of the corporate world. Staff is recommending participation in the 2023-24 Yearbook and building a half page ad around Farmington's desire to be bold and boldly pursue Farmington's vision. The timing aligns nicely with the community vision and comprehensive plan update and fits within the dedicated marketing budget. The cost would be $8000 for a half page, full color ad. Director Kuennen highly recommends that the EDA do this. It lines up from a timing perspective and community vision. This is unexpected for Farmington and only a limited number of cities will be included. It has a digital piece, as well. Commissioner Hoyt said this is 50,000 pieces of literature eight times in a year. Commissioner Porter said we have had several Vikings in Farmington that should be included. Economic Development Authority Minutes April 17, 2023 Page 6 of 6 Motion was made by Commissioner Porter and seconded by Commissioner Bernatz to approve the purchase of advertisement space I the Minnesota Vikings 2023-24 Yearbook for$8,000 from the 2023 marketing budget. Motion carried: 5 ayes / 0 nays. 9. DIRECTOR'S REPORT 9.1 Director's Report Director Kuennen said they are representing Farmington at events, hosting a booth and as speakers at events. The more we are there the more they want to know. We will continue to push Farmington to the brokerage community. We are filling our calendars with meetings. We also met with Greystone Construction, and they are very interested in exploring how to be a player here. Chair Wilson said you want your business community to be advocates for you, and this is perfect. Director Kuennen mentioned some of the highlights: • Minnesota Real Estate Journal (Summit) — we are helping identify speakers for that and building a content. • Business View Magazine — Mayor Hoyt, Administrator Gorski, and Director Kuennen will be interviewed for this national magazine that becomes a standalone piece. This is an exciting opportunity for the City of Farmington. 10.ADJOURNMENT Motion was made by Commissioner Porter and seconded by Commissioner Hoyt to adjourn the meeting at 6:40 p.m. Motion carried: 5 ayes / 0 nays. Ispectfully submitted, S ' ey Ple City Clerk '