Agenda - Council - 01/23/2024 - Laserfiche WebLink

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Councilmember Howell stated that she has spoken with a small business employer who noted this is a great concern of theirs. She noted that she would like to see a way to have employers with small numbers of employees being exempt from this. Councilmember Woestehoff asked if the League of Minnesota Cities has commented on this. City Administrator Hagen said he does not think so. He shared that this topic was discussed at the Operating Committee of the North Metro Mayors Association and they discussed some suggestions of different kinds of businesses. He noted that the Operating Committee believed that there may not be any changes to this law this year. Councilmember Woestehoff shared that he is looking at this from the City's perspective as it does affect the City. City Administrator Hagen said that they offer more hours per year as Councilmember Musgrove stated previously; however,the ESST requirement expands the allowed use to a certain degree. He noted that Staff had not discussed opening up the allowed uses. He said that the argument that they offer more hours per year may not be a great argument as the legislature would look at the allowed uses. Councilmember Musgrove shared that she still thinks that there needs to be a limit of what they offer and they are already offering their employees more benefits and more hours than ESST. She noted that there may be a workaround for this where they give employees more vacation time to use however they like. She stated this is a lot of stuff that they have to rethink and move around when they already have a better product. She added that there are also a lot of small businesses in the City and she believes these businesses would appreciate them looking at this for their sake as well. Councilmember Howell agreed with Councilmember Musgrove and reiterated the stress that this would put on small business owners. She added this could also hurt taxes coming in as businesses will start going under. She noted that this does affect them more than just considering the number of employees that they have at the City. Mayor Kuzma suggested adding an exemption for businesses with less than 25 employees. City Administrator Hagen asked if they want to list a specific number of employees or just generally recognize small businesses. Councilmember Musgrove suggested leaving this open for debate for small businesses. Economic Development Manager Sullivan shared that they have all seen what has been happening with property values and noted that they will begin seeing rents increasing for small businesses that are renting retail space. He noted this will be tough for small businesses and this will be just another thing that will be added on top of this. City Council Work Session /January 9, 2024 Page 6 of 9