Minutes - Council - 07/08/2003 - Laserfiche WebLink

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Jim Corn, CPA Management Consultant, stated that he has been working with Mr. Deal on the development of his property since he purchased the land. He explained that he was provided a copy of Mr. Tinklenberg's report and he thought the information and background data was very good for the Council to see, but when looking at the economics of what the report says it states the City does not want to be purchasing the land ten years from now because of the increase in land costs. What the report fails to consider is the loss of tax revenue. If the City purchases the property now they are taking 26 million in tax base off and the project is 10 years out. Secondly if the City stops future development they are stopping future revenues to the City. He contended that the cost of waiting 10 years is less than the rate of inflation. Councilmember Cook stated that the idea after the property is officially mapped is to buy out the landowners that are interested in selling their land. He did not believe that the City would be purchasing every business. The other option for the City would be buy out a business and then lease it back to the business owner to run their business until the project is in place. Mr. Corn replied that he was going off the numbers included in The Tinklenberg Group report. Councilmember Strommen stated that the City does not have to purchase any properties at the end of this process, but it does provide them information as to what the future may be for the area. The moratorium provides the City with some time to research the options. Councilmember Kurak stated that she would be abstaining from voting on the issue, but she felt that it was very important for the property owners to not be in limbo. She felt that the moratorium would allow the City to determine how they are going to handle the issue so that the property owners are not in limbo. She noted that the City Council did give the issue a lot of consideration. Mayor Gamec inquired after the six-month period if a property owner along Highway #10 wanted to sell their property for development what would the City's response be. Mr. Tinklenberg explained that they would contact staff to talk about zoning issues and requirements and then they could move forward with receiving approvals for the building. Over the next six months they will be doing an analysis to provide tools to the City to work with the different property owners. If the Council were to choose to purchase property they would be reimbursed. It was never anticipated that a one-size fits all approach would fit every property along the corridor. Councilmember Kurak noted that there are business plans that can be put into affect where the building can be depreciated over time and still make money. Councilmember Elvig stated that by placing the moratorium on the property to research the possibility of officially mapping the area it provides a serious statement to MnDOT that the City needs and wants improvements. Once the moratorium is lifted the property owners can buy and sell land with the risk that their land could be purchased for redevelopment. City Council/July 8, 2003 Page 13 of 30