EDA Handbook by Jody Gunderson

CITY OF NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Handbook

Northfield City Hall • 801 Washington Street • Northfield, MN 55057-2598 Direct 507.645.3018 • Fax 507.645.3055 • www.ci.northfield.mn.us

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NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY MEMBER HANDBOOK Index 1. Organizational Structure ...............................................................................Section 1 2. Member Information ......................................................................................Section 2  Contact Information  Terms  Officers  Ad hoc Work Groups 3. Meeting Dates ..................................................................................................Section 3 4. EDA Job Description ......................................................................................Section 4 5. Enabling Resolution ........................................................................................Section 5 6. EDA By-Laws ..................................................................................................Section 6 7. EDA Procedures & Protocol ..........................................................................Section 7 8. Conflict of Interest Memo ..............................................................................Section 8 9. Work Plan ........................................................................................................Section 9 10. Budget ............................................................................................................Section 10 11. Program Descriptions & Applications ........................................................Section 11  Business Subsidy Policy  Downtown Revolving Loan  Master Development Fund  Clement F. Shearer Micro Grant  JOBZ  Public Finance Request Scoring Matrix  TIF & Tax Abatement 12. Comprehensive Economic Development Plan ............................................Section 12 13. State Statutes – Chapter 469 ........................................................................Section 13 14. Miscellaneous.................................................................................................Section 14

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Organizational Structure

Section 1

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CITY OF NORTHFIELD Economic Development Authority Organizational Chart

Citizens of Northfield Northfield City Council

City Administrator Economic Development Authority Board

Director of Economic Development

Policy Implement Northfield Economic Development Authority

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Member Information

Section 2

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Revised: 8/24/2010

Northfield Economic Development Authority 2010 Board Members

Ms. Jenelle Teppen 705 Highland Avenue Northfield, MN 55057 Work: (651) 450.2512 Mobile: (612) 598.6588 Email: jteppen@ci.inver-grove-heights.mn.us Appointment Expires: 12/31/2012

Mr. Steve Engler 1600 Independence Dr. Northfield, MN 55057 Home: (507) 645.7084 Mobile: (612) 719.6629 Email: slenglerNfld@gmail.com Appointment Expires: 12/31/2011

Ms. Rhonda Pownell 1300 Cannon Valley Drive Northfield, MN 55057 Home: (507) 663.1932 Email: Rhonda.Pownell@ci.northfield.mn.us City Council Representative

Mr. Victor Summa 812 St. Olaf Avenue Northfield, MN 55057 Home: (507) 663.6097 Mobile: (507) 649.0238 Email: summa.victor@gmail.com Appointment Expires: 12/31/2010

Mr. Richard D. Estenson First National Bank of Northfield P.O. Box 59 Northfield, MN 55057 Work: (507) 645.5656 Ext.275 Mobile: (612) 242.1897 Email: restenson@firstnationalnorthfield.com Appointment Expires: 12/31/2013

Mr. Jim Pokorney 303 Washington Street Northfield, MN 55057 Work: (651) 789.0550 Mobile: (507) 301.9065 Email: Jim.Pokorney@ci.northfield.mn.us City Council Representative

Mr. Jack Hoschouer 2031 Taylor Ct Northfield, MN 55057 Home: (507) 645-2311 Mobile: (507) 581-1614 Email: jack@saphenet.com Appointment Expires: 12/31/2015

Mr. Jody T. Gunderson Economic Development Director 801 Washington Ave Northfield, MN 55057 Work: (507) 645.3018 Mobile: (612) 968.6407 Email: Jody.Gunderson@ci.northfield.mn.us

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City of Northfield | Economic Development Authority 2010 Committee Assignments

Executive

Infill and Redevelopment

Business Recruitment Marketing

Business Park Development

Business Retention and Expansion

Jody Gunderson, Dir.

Fed/State/Cnty

President

Steve Engler

V.P.

Rhonda Pownell

S/T

Lead Member Member

Rick Estenson

Member

Jim Pokorney

Lead Member

Victor Summa

Member

Lead

Jack Hoschouer Support Organization NEC NDDC

Chamber of Commerce, NDDC, City Staff

Janelle Teppen,

Chamber of Commerce

Business Park Master Plan Committee Consultant Hoisington Koegler Group Inc.

Jeff McMenimen Project Manager

Mark Koegler Principal in Charge

Steering Committee

Rick Estenson Jim Pokorney Rhonda Pownell Erica Zweifel

Tracy Davis Tim Geary Christopher Sawyer Neil Lutsky

Technical Committee

Additional Responsibility

Jody Gunderson Brian Oâ&#x20AC;&#x2122;Connell

Dan Olson Katy Gehler-Hess

Mike Berthelsen Pete Sandberg Scott Richardson Jay Jasnoch

BRE CVB NEC, BRE CVN NDDC

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2010 Meeting Dates

Section 3

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ECONOMIC DEVELOPMENT AUTHORITY MEETING DATES 2010 S

JANUARY T W T

3 10 17 24 31

4 11 18 25

5 12 19 26

S 7 14 21 28

M 1 8 15 22 29

MARCH T W T 2 3 4 9 10 11 16 17 18 23 24 25 30 31

2 9 16 23 30

3 10 17 24 31

4 11 18 25

5 12 19 26

S 7 14 21 28

6 13 20 27

7 14 21 28

MAY W T

F 1 8 15 22 29

S 2 9 16 23 30

F 5 12 19 26

S 6 13 20 27

S 7 14 21 28

M 1 8 15 22

4 11 18 25

5 12 19 26

6 13 20 27

FEBRUARY T W T F 2 3 4 5 9 10 11 12 16 17 18 19 23 24 25 26

APRIL W T 1 6 7 8 13 14 15 20 21 22 27 28 29 T

F 2 9 16 23 30

S 3 10 17 24

7 14 21 28

T 1 8 15 22 29

JUNE W T 2 3 9 10 16 17 23 24 30

F 4 11 18 25

S 5 12 19 26

F 6 13 20 27

S 7 14 21 28

F 1 8 15 22 29

S 2 9 16 23 30

F 3 10 17 24 31

S 4 11 18 25

6 13 20 27

7 14 21 28

S 1 8 15 22 29

JULY W T 1 6 7 8 13 14 15 20 21 22 27 28 29

F 2 9 16 23 30

S 3 10 17 24 31

S 1 8 15 22 29

M 2 9 16 23 30

AUGUST T W T 3 4 5 10 11 12 17 18 19 24 25 26 31

F 3 10 17 24

S 4 11 18 25

OCTOBER T W T

6 13 20 27

SEPTEMBER T W T 1 2 7 8 9 14 15 16 21 22 23 28 29 30

3 10 17 24 31

4 11 18 25

5 12 19 26

M 1 8 15 22 29

NOVEMBER T W T 2 3 4 9 10 11 16 17 18 23 24 25 30

F 5 12 19 26

S 6 13 20 27

5 12 19 26

S 5 12 19 26

S 6 13 20 27

6 13 20 27

7 14 21 28

DECEMBER T W T 1 2 6 7 8 9 13 14 15 16 20 21 22 23 27 28 29 30 M

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EDA Job Description

Section 4

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JOB DESCRIPTION Northfield Economic Development Authority I.

Mission Improve the economic condition of Northfield through appropriate commercial and industrial development, thus creating a higher tax base and further job opportunities, all ways that meet the guidelines of the City Comprehensive Plan.

II.

Role of the Authority The Northfield Economic Development Board of Commissioners serves, as created by the City Council, as the primary economic development agency for the City of Northfield. Its primary responsibilities are defining and ensuring adherence to the organization's mission, strategic planning, ensuring tax base and job growth, financial oversight of the Downtown Revolving loan Fund, and recommendations to the Northfield City Council on matters concerning local economic development issues. The Economic Development Authority (EDA) has those powers delegated to it in its areas of responsibility by provisions of Resolution #90 -187 that established the Northfield Economic Development Authority under Minnesota Statutes Sections 469.090 through 469.108. All official actions of the EDA must be consistent with the adopted Comprehensive Plan of the City and any official controls implementing such plan m.

III.

Membership The voting membership shall include seven commissioners, including two Council members, appointed by the Mayor of the City of Northfield, with the concurrence of a majority of the members of the City Council. The Economic Development Manager and the others from the Community Development staff are also invited to attend the Board meetings but are not considered members and do not vote.

IV.

Duties of the Authority as a Body A. Establish and maintain the organization's mission with the City's Comprehensive Plan as a guide. B. Act as trustee for the assets and investments of the organization. C. Advise the City Council on developments and community plans for economic development policy. D. Monitor the resources available in the community that will aid the continued growth of jobs and tax base with the community. E. Develop and operate under an annual budget as approved by City Council. F. Govern itself by electing officers and recommending candidates for membership to the Mayor when vacancies occur. G. Establish an annual work plan and monitor its progress.

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JOB DESCRIPTION Northfield Economic Development Authority H. Involve others (Boards and Commissions, City Council, Northfield Chamber of Commerce, NIC, NDDC, businesses and individuals) in economic development efforts. I. Serve as a recommendation body to the City Council. V.

Meeting Schedule By Council Resolution, the Authority will meet at least monthly. In practice, the Authority meets twice monthly on the second and fourth Thursday at 7 :30 a.m. Occasionally special meetings, planning sessions or training sessions are called as needed using procedures as described in the EDA Bylaws.

VI.

Documentation Requirements The Authority will document all findings, conclusions, recommendations, actions and follow-up results in a formal written set of minutes or by a resolution as appropriate.

VII.

Responsibilities of Board Members A. Be familiar with State and local enabling legislation governing rules and responsibilities, governance and latitudes for an EDA and the City's Comprehensive Plan. B. Prepare for Board and committee meetings by whatever study and preparatory work are necessary to deliberate intelligently with other members. C. Attend meetings of the Board and assigned committees. D. Execute Board assignments on time. E. Maintain confidentiality and security regarding development projects. F. Contribute positively to Board discussions, assisting the Board in reaching conclusions. G. Acquire a working knowledge of those functional activities for which the member has been assigned. H. Develop a broad knowledge of key trends in development activity and future growth needs for the City of Northfield. I. Be alert to new program opportunities and assist the organization on specific programs when requested. J. Reveal conflicts of interest as they arise in Board deliberations and abstain from Board discussions and voting on such matters. K. Participate in the Board's annual strategic planning retreat.

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Enabling Resolution

Section 5

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MEMORANDUM To:

Jody T. Gunderson, Director of Economic Development

cc:

Joel Walinski, City Administrator Deb Little, City Clerk

From:

Christopher M. Hood and Robert T. Scott

Date:

April 5, 2010

Re:

Operative Effect of the Northfield Economic Development Authority’s Enabling Resolution

VIA EMAIL ONLY

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - The following memorandum is in response to your request for a legal opinion regarding the operative effect of City of Northfield (City) Resolution #90-187, the Enabling Resolution establishing the Northfield Economic Development Authority (EDA) under Minn. Stat. §§ 469.090 through 469.108 (Enabling Resolution). A question has arisen regarding the Enabling Resolution’s force and effect because neither the City nor the EDA can locate a signed copy of it. However, the City’s records contained a copy of the Enabling Resolution that was presented for the City Council’s consideration first at the June 18, 1990 regular City Council Meeting, and the minutes from that meeting, at which the City Council tabled the Enabling Resolution, and a subsequent regular City Council meeting on September 17, 1990, at which the City Council unanimously approved an amendment to Paragraph 3(f) of the Enabling Resolution and then adopted the Enabling Resolution by unanimous vote. A copy of the Enabling Resolution as presented for the City Council’s consideration on June 18, 1990 and the minutes documenting all actions taken by the City Council with respect thereto is included as Appendix B to the sample Certification of Official Record attached hereto as Exhibit 1. These records constitute conclusive evidence that the City Council in fact duly passed and adopted the Enabling Resolution as amended on September 17, 1990 thereby establishing the EDA in accordance with governing law. The City’s Home Rule Charter (Charter) governs the procedures to be followed by the City Council in passing and adopting resolutions, and the effect of such resolutions, as the Minnesota Supreme Court has established in cases involving other home rule charter cities.1 The Charter sets forth several requirements for the City Council’s passage of resolutions, including that every resolution shall be presented in writing and read in full before a vote is taken thereon (except when resolutions are submitted in the consent agenda or the reading of a resolution is dispensed with unanimous consent) (Section 4.9), that an affirmative vote of a majority of all the members 1

See Hjelm v. City of St. Cloud, 129 Minn. 240, 152 N.W. 408; Markley v. City of St. Paul, 142 Minn. 356, 172 N.W. 215; Northern Pac. Ry. Co. v. City of Duluth, 153 Minn. 122, 189 N.W. 937.

of the council is required for a resolution to pass (Section 4.5), and that every ordinance or resolution passed by the council shall be signed by the mayor and attested, filed and preserved by the city clerk (Section 4.10). However, the Charter makes clear that a resolution takes effect not upon completion of the required administrative task of signing a resolution that has duly been passed by the City Council, but rather at the very time the council takes the official action to pass the resolution. Specifically, the Charter states that “(a) resolution and an emergency ordinance shall take effect immediately upon its passage.” (Section 4.11, emphasis added). Thus, the Enabling Resolution is of full force and effect, and has been since its unanimous adoption by the City Council on September 17, 1990, despite the inability of the City and EDA to locate a signed copy of it. The inability of the City and EDA to locate a signed copy of the Enabling Resolution nevertheless raises an administrative issue for the City, as the Charter requires all resolutions to be “signed by the mayor and attested, filed and preserved by the city clerk (Section 4.10).” According to the Charter, “the city clerk shall have duties in connection with the keeping of the public records.” (Section 7.5) Given that the Enabling Resolution may or may not have been signed by the Mayor and attested to by the City Clerk as required by the Charter upon its passage and taking effect in 1990, our recommendation is that the City Clerk execute a Certification of the Enabling Resolution substantially in the form of the Certification of Official Record attached hereto as Exhibit 1 that (1) sets forth the content of the Enabling Resolution as passed by the City Council after amending Paragraph 3(f) of the form provided to it for consideration; (2) acknowledges that no signed copy of the Enabling Resolution exists in the City’s records; (3) states that the Enabling Resolution took effect upon its unanimous passage by the City Council on September 17, 1990 pursuant to Section 4.11 of the Charter; (4) refers to subsequent amendments to the Enabling Resolution passed by the City Council since the Enabling Resolution’s passage on September 17, 1990; and (5) certifies as true, complete and accurate the content of the Enabling Resolution contained in the certification. It would be well within the authority of the city clerk as defined in Section 7.5 of the Charter to provide such a certification, and it would seem that such a certification would be necessary to eliminate any controversy over the status of the Enabling Resolution, and consequently of the EDA itself, caused by the City’s and EDA’s inability to locate a properly signed and attested to copy of the original Enabling Resolution. If you have any questions about this memorandum or need further assistance, please contact us at your convenience. CMH/rs

Northfield Economic Development Authority Enabling Resolution and Bylaw Timeline

1990 JUNE Action Taken  City holds public hearing for Resolution #90-187, the EDA’s Enabling Resolution  Motion to table resolution #90-187 until: 1. a tentative board has been established 2. goals developed 3. policies developed  Motion carried

F 1

S 2

SEPTEMBER    

Action Taken Motion to approve Resolution 90-292 acknowledging recommendation from the EDA Goals Committee, including mission statement, goals, objectives, and limitation of powers in support of Resolution 90-187 to establish a Northfield EDA Motion carried Motion to remove from the table resolution #90-187 Motion carried

 Motion to approve Resolution 90-187, EDA’s Enabling Resolution  Motion carried  Motion to pass resolution #90-292 acknowledging recommendations from the EDA goals committee, including mission statement, goals, objectives, and limitation of powers in support of resolution #90-187 to establish a Northfield Economic Development Authority  Motion carried  #90-293 adopting EDA goals, objectives, and mission statement  Motion carried

1 9

JANUARY T W T 1 2 3 8 9 10 15 16 17 22 23 24 29 30 31

F 4 11 18 25

S 5 12 19 26

F 3 10 17 24 31

S 4 11 18 25

1991 Action Taken  Motion by EDA Board to approve EDA’s Bylaws  Motion carried  There is no record of the EDA ever providing bylaws to the City Council for approval and there is no record of the Council ever approving amendments to the EDA’s bylaws prior to 2008.  Amendments discussed in original bylaws of the EDA do not require City Council approval

6 13 20 27

7 14 21 28

5 12 19 26

6 13 20 27

OCTOBER T W T 1 2 7 8 9 14 15 16 21 22 23 28 29 30

DECEMBER T W T

2008 Action Taken  Motion by EDA Board to approve Resolution #. 2008-008, amending enabling resolution to allow for non-residents to serve on Board and affirm EDA’s bylaws  Motion carried

Action Taken  City holds public hearing for amending EDA’s Enabling Resolution  Motion to approve city council resolution 2008-149 amending enabling resolution to allow for non-residents to serve on Board and affirm EDA’s bylaws  Motion carried

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EDA Bylaws

Section 6

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MEMORANDUM To:

Jody T. Gunderson, Director of Economic Development

cc:

Joel Walinski, City Administrator

From:

Christopher M. Hood and Robert T. Scott

Date:

March 31, 2010

Re:

Operative Effect of the Northfield Economic Development Authority’s Bylaws

VIA EMAIL ONLY

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - The following memorandum is in response to your request for a legal opinion regarding the operative effect of the Northfield Economic Development Authority’s (EDA) bylaws. Background The EDA was created in 1990 by City of Northfield (City) Resolution #90-187, the Enabling Resolution establishing the Northfield Economic Development Authority (EDA) under Minn. Stat. §§ 469.090 through 469.108 (Enabling Resolution). The Enabling Resolution granted all statutory powers to the EDA under Minn. Stat. §§ 469.090 to 469.108, but limited the EDA’s authority by requiring, among other things, that the EDA “must submit administrative structure and management practices to the Council for approval and conduct its affairs consistent with those structures and management practices,” as permitted by Minn. Stat. § 469.092, subd. 1(7). Our understanding is that since the EDA’s creation in 1990 the EDA Board of Directors (Board) has generally acted to establish and amend from time to time its own bylaws, even though some of the bylaws at least arguably concern the EDA’s “administrative structure and management practices” such that City Council approval thereof would be required by the Enabling Resolution. However, the EDA Board has, on occasion, sought and received City Council approval for specific amendments to its bylaws, as was the case for several amendments adopted by the Board on December 17, 2009 and approved by the City Council at its regular meeting on January 19, 2010. Our review of the City’s official records, including the minutes and agenda packets for City Council meetings, further reveals that the EDA presented the entirety of its bylaws, as amended and adopted by the Board on October 26, 2007, to the City Council for its consideration at its December 15, 2008 regular meeting in conjunction with the City Council’s amendment of the Enabling Resolution, and the City Council, in Resolution 2008-149 (attached hereto as Appendix A), acknowledged and announced its support for the entirety of the EDA’s bylaws at such meeting.

Analysis As the scope of our review of the status of the EDA bylaws in this Memorandum is limited to the bylaws’ current operative effect, we have not examined every action taken by the EDA Board since its creation in 1990 with respect to its bylaws and have not attempted to determine the bylaws’ force and effect at any time prior to December 15, 2008. However, the City Council’s effective approval of the bylaws in Resolution 2008-149 on December 15, 2008 satisfied the Enabling Resolution’s condition that bylaws “administrative structure and management practices” be approved by the City Council, such that there is no question that as of December 15, 2008, the entirety of the EDA’s bylaws as amended and adopted by the Board on October 26, 2007 were of full force and effect. Consequently, the bylaws remain in full force and effect unless the Board has amended one or more of its bylaws since October 26, 2007 such that the EDA’s “administrative structure and management practices” changed without receiving City Council approval of any such amendments. The only bylaw amendments after October 26, 2007 of which we are aware were adopted by the Board on December 17, 2009, and approved by the City Council at its regular meeting on January 19, 2010. Assuming no other amendments have been made since October 26, 2007 that would impact the EDA’s “administrative structures and management practices,” the entirety of the EDA’s bylaws have been approved by the City Council, and are unquestionably of full force and effect. If you have any questions about this memorandum or need further assistance, please contact us at your convenience. CMH/rs

APPENDIX A

CITY OF NORTHFIELD, MINNESOTA CITY COUNCIL RESOLUTION 2008-149 A RESOLUTION BY THE MAYOR AND CITY COUNCIL OF THE CITY OF NORTHFIELD, MINNESOTA ADOPTING AN AMENDMENT TO ITS ENABLING LEGISLATION ALLOWING NON-RESIDENTS THAT EITHER RESIDE, OWN PROPERTY OR ARE EMPLOYED WITHIN THE MUNICIPALITY OF NORTHFIELD TO SERVE ON THE ECONOMIC DEVELOPMENT AUTHORITY (EDA) BOARD

WHEREAS, the City of Northfield's Economic Development Authority (EDA) was created in 1990 pursuant to Minnesota Statute 469; and, WHEREAS, staff has researched the minutes from the City Council meeting involving the passage of Resolution No. 90-187 Northfield's EDA enabling resolution; and, WHEREAS,

the City Council minutes reflect a desire to restrict EDA board appointments to only those individuals with a permanent address within the City of Northfield; and

WHEREAS, the language regarding residency does not appear to have been incorporated into the enabling resolution; and WHEREAS, the Mayor has appointed and the City Council approved EDA board members that appear to conflict with the stated intention of the City Council during its deliberation over the EDA's enabling resolution; and WHEREAS, Minnesota Statute Section 469 does not place a residency restriction on an EDA Board organized for this purpose; and WHEREAS, the EDA's current by-laws allow non-residents which reside, own property or are employed within the municipality of Northfield to serve on the EDA board; and WHEREAS, on October 23,2008, the EDA board passed a resolution requesting that the City Council amend its enabling resolution to provide clarity regarding residency requirements. NOW, THEREFORE, BE IT RESOLVED BY THE MAYOR AND CITY COUNCIL THAT: The Economic Development Authority enabling resolution is hereby amended to allow for nonresidents which reside, own property or are employed within the municipality of Northfield to serve on the EDA board. BE IT FURTHER RESOLVED: the City Council acknowledges and support the organization's by-laws as amended and adopted by the EDA Board on October 26, 2007. PASSED by the City Council of the City of Northfield on this 15 th day of December 2008.

ATTEST:

Ott£l~

City Clerk

VOTE:

DAVIS

DENISON N LANSING POKORNEY POWNELL J1 NELSON VOHS

-Y

BYLAWS OF THE NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY ARTICLE I - THE AUTHORITY Section 1. Name of Authority. The name of the Authority shall be the “Northfield Economic Development Authority” (which may sometimes be referred to as the “EDA” or the “Authority”), and its governing body shall be called the Board of Commissioners (the “Board”). The Board shall be the body responsible for the general governance of the Authority and shall conduct its official business at meetings thereof. Section 2. Membership. The Board shall consist of seven commissioners; five appointed by the Mayor with the approval of the Council, with six-year terms of office, and two commissioners who are members of the Northfield City Council appointed by the Mayor on an annual basis. Members may be residents or non-residents whom own property or are employed within the municipality of Northfield, Minnesota. (Amended 10-23-08). Section 3. Term Limits. Term lengths for the EDA are established in State Statues, Chapter 469.095, Sudb. 2(c). An EDA member is allowed to serve one full six-year term, plus a partial term if they were appointed to fill a vacated term. A member must then be off of the EDA one year before that person can be reappointed to the EDA. (Amended 10-26-06). The following table outlines the terms of the 2009 EDA Board: Name Jim Pokorney (City Council) Rhonda Pownell (City Council) Richard Estenson Vacant Seat Victor Summa Marty Benson Steve Engler

Term Expires (December) 2013 2012 2010 2009 2011

Eligible for Reappointment

Next Term 2019 2018 2016 2015 2017

Section 4. Filling Vacant Terms. Board and Commission members are appointed by the Mayor and approved by the City Council. It is at the discretion of the Mayor and City Council who will fill vacated terms. The following steps will be followed to ensure a candidate is appointed by the time the term expires: a) The Executive Committee, serving as the nomination committee will draft and review with the EDA a set of qualification criteria to evaluate potential candidates. b) 45 days prior to expiration of the term, the EDA will place an advertisement in the newspaper seeking interested candidates. EDA BY-LAWS - APPROVED May 26, 2005 S:\Community Development\ECONOMIC DEVELOPMENT AUTHORITY\EDA By-Laws and Handbook\2009\BYLAWS AMENDED 20082009.docx

c) The Executive Committee, serving as the nomination committee will review the applications and recommend to the EDA, two candidates to be forwarded to the Mayor for consideration. d) At least two weeks prior to expiration of the term, the EDA will forward the names of the two recommended candidates to the Mayor, with an explanation as to why these candidates are being recommended. In case of a resignation the following steps should be followed to ensure a candidate is appointed within 60 days of the resignation: a) The EDA will immediately place an advertisement in the newspaper seeking interested candidates. b) The Executive Committee, serving as the nomination committee will draft and review with the EDA a set of qualification criteria to evaluate potential candidates. c) The Executive Committee, serving as the nomination committee will review the applications and recommend to the EDA, two candidates to be forwarded to the Mayor for consideration. d) Within 45 days of the resignation, the EDA will forward the names of the two recommended candidates to the Mayor, with an explanation as to why these candidates are being recommended. (March 8,2007) Section 5. Office of Authority. The offices of the Authority shall be at the Northfield City Hall, or at such other location approved by Resolution of the Northfield City Council. ARTICLE II - OFFICERS Section 1. Officers. The officers of the Authority shall be a President, a Vice-President, a Secretary/Treasurer, and an Assistant Treasurer. The President, the Vice-President, and the Treasurer shall be members of the Board and shall be elected annually, and no Commissioner may be both President and Vice-President simultaneously. (Amended 3-28-02). Section 2. President. The President shall preside at all meetings of the Board. Except as otherwise authorized by resolution of the Board, the President and the Secretary/Treasurer (the Vice-President, in the Secretary/Treasurerâ&#x20AC;&#x2122;s absence or incapacity) shall sign all contracts, deeds, and other instruments made or executed by the Authority, except that all checks of the Authority shall be signed by the Secretary/Treasurer and Assistant Treasurer. At each meeting, the President shall submit such recommendations and information as he or she may consider proper concerning the business, affairs, and policies of the Authority. The President shall serve a minimum two-year term (Amended 10-26-2006). Section 3. Vice-President. The Vice-President shall perform the duties of the President in the absence or incapacity of the President; and in case of the resignation or death of the EDA BY-LAWS - APPROVED May 26, 2005 S:\Community Development\ECONOMIC DEVELOPMENT AUTHORITY\EDA By-Laws and Handbook\2009\BYLAWS AMENDED 20082009.docx

President, the Vice-President shall perform such duties as are imposed on the President until such time as the Board shall select a new President. The Vice President shall serve a minimum twoyear term (Amended 10-26-06). Section 4. Secretary/Treasurer. The Secretary/Treasurer shall insure that minutes are kept of all meetings of the Board and all records retained of the Authority. The Secretary shall also have such additional duties and responsibilities as the Board may from time to time and by resolution prescribe. The Secretary/Treasurer shall have the care and custody of all funds of the Authority and shall deposit the same in the name of the Authority in such bank or banks as the Board may select. The Secretary/Treasurer and Assistant Treasurer shall sign all orders and checks for the payment of money and shall pay out and disburse such moneys under the direction of the Board. The Secretary/Treasurer shall keep regular books of accounts showing receipts and expenditures and shall render to the Board, at least annually (or more often when requested), an account of such transactions and also of the financial condition of the Authority. (Amended 3-28-02). The Secretary/Treasurer shall serve a minimum two-year term (Amended 10-26-06). Section 5. Assistant Treasurer. The Assistant Treasurer shall act as the Secretary/Treasurerâ&#x20AC;&#x2122;s agent and assistant to perform the above-described duties, subject to the Treasurerâ&#x20AC;&#x2122;s approval thereof. (Amended 3-28-02). Section 6. Executive Committee. The Executive Committee of the EDA is comprised of the President, Vice-President, and Secretary. This group will meet only on an as-needed basis to provide direction to Staff regarding deal structuring, loan reviews, budget preparation, and Board nominations. The Executive Committee will have no authority to bind or obligate the EDA, but instead will work with Staff to formulate recommendations to the EDA as a whole. (Amended 1026-06). Section 7. EDA Liaisons. EDA Liaisons function as an arm to the EDA and provide expertise on specific topics. Liaison roles will only be created for the purpose of implementing the Comprehensive Economic Development Plan. (Amended 10-26-07). Section 8. Additional Duties. The officers of the Authority shall perform such other duties and functions as may from time to time be required by the Board or the bylaws or rules and regulations of the Authority. Section 9. Vacancies. Should the office of President, Vice-President, Secretary/Treasurer, or Assistant Treasurer become vacant, the Board shall elect a successor from its membership at the next regular meeting, or at a special meeting called for such purpose, and such election shall be for the unexpired term of said officer. Section 10. Additional Personnel. The Board may from time to time employ such personnel as it deems necessary to exercise its powers, duties, and functions.

EDA BY-LAWS - APPROVED May 26, 2005 S:\Community Development\ECONOMIC DEVELOPMENT AUTHORITY\EDA By-Laws and Handbook\2009\BYLAWS AMENDED 20082009.docx

Bylaws of the Northfield Economic Development Authority Page 4 ARTICLE III - MEETINGS Section 1. Regular Meetings. The Board may hold regular meetings, at least monthly, according to a meeting schedule, if any, adopted or revised from time to time by the Board. Section 2. Special Meetings. Special meetings of the Board may be called by the President or any two (2) members of the Board for the purpose of transacting any business designated in the call. The call for a special meeting may be delivered at any time prior to the time of the proposed meeting to each member of the Board or may be mailed to the business or home address of each member of the Board at least two (2) days prior to the date of such special meeting. At such special meeting, no business shall be considered other than as designated in the call, but if at least four (4) members of the Board are present at a special meeting, any and all business may be transacted at such special meeting. Notice of any special meeting shall be posted and/or published as may be required by law. Section 3. Quorum. The powers of the Authority shall be vested in the Board. Four (4) Commissioners shall constitute a quorum for the purpose of conducting the business and exercising the powers of the Authority and for all other purposes, but a smaller number may adjourn from time to time until a quorum is obtained. When a quorum is in attendance, action may be taken by the Board upon a vote of the majority of the Commissioners present. Section 4. Adoption of Resolutions. Resolutions of the Board shall be deemed adopted if approved by not less than a simple majority of all Commissioners present, unless a different requirement for adoption is prescribed by law. Resolutions may but need not be read aloud prior to vote taken thereon. (Amended 3-28-02). Section 5. Rules of Order. The meetings of the Board shall be governed by the most recent edition of Robertâ&#x20AC;&#x2122;s Rules of Order. ARTICLE IV - MISCELLANEOUS Section 1. Amendments to Bylaws. The bylaws of the Authority shall be amended by resolution by a simple majority at which a quorum is present at the meeting. The proposed amendments must be delivered to the Board at least seven (7) days in advance of the meeting at which the amendment(s) will be considered. Section 2. Fiscal Year. The fiscal year of the Authority shall coincide with the fiscal year of the City of Northfield.

EDA BY-LAWS - APPROVED May 26, 2005 S:\Community Development\ECONOMIC DEVELOPMENT AUTHORITY\EDA By-Laws and Handbook\2009\BYLAWS AMENDED 20082009.docx

Passed by the EDA January 14, 1991 BYLAWS OF THE NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY ARTICLE I - THE AUTHORITY Section 1. Name of Authority. The name of the Authority shall be the "Northfield Economic Development Authority" (which may sometimes be referred to as the "EDA" or the "Authority"), and its governing body shall be called the Board of Commissioners (the "Board") • The Board shall be the body responsible for the general' governance of the Authority and shall conduct its official business at meetings thereof. section 2. Membership. The Board shall consist of seven Commissioners, appointed by the Mayor, with six-year terms of office. Two Commissioners must be members of the Northfield City council. Initial terms of the Board shall include one (1) as a one-year term, one (1) as a two-year term, one (1) as a three-year term, one (1) as a four-year term, one (1) as a five-year term, and two (2) as six-year terms. section 3. official seal, as Subdivision 1.

~s~e~a~I~~o~f~~A~u~t~h~o:r~i~t~y.

required

The Authority shall have an by Minnesota Statutes, section 469.096,

section 4. Office of Authority. shall be the Northfield City Hall.

The offices of the Authority

ARTICLE II - OFFICERS section 1. Officers. The officers of the Authority shall be a President, a Vice-President, a Treasurer, an Assistant Treasurer, and a Secretary. The President, the Vice-President, and the Treasurer shall ··De - meitiliers·- ofthe-gOard ana-·shall be-elected annually~--ana·-n-o Commissioner may be both President and Vice-President simultaneously. section 2. President. The President shall preside at all meetings of the Board. Except as otherwise authorized by resolution of the Board, the President and the Secretary (the Vice-President, in the Secretary's absence of incapacity) shall sign all contracts, deeds, and other instruments made or executed by the Authority, except that all checks of the Authority shall be signed by the Treasurer and Assistant Treasurer. At each meeting the President shall submit such recommendations and information as-he or she-may· ... consider proper concerning the business, affairs, and policies of the Authority.

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section 3. Vice-President. The Vice-President shall perform the duties of the President in the absence of incapacity of the President; and in case of the resignation or death of the President, the Vice-President shall perform such duties as are imposed on the . President until such time as the Board shall select a new President.

..,

Bylaws of the Northfield Economic Development Authority Page 2 section 4. Secretary. The Secretary shall keep minutes of all meetings of the Board and shall maintain all records of the Authority. The Secretary shall also have such additional duties and responsibilities as the Board may from time to time and by resolution prescribe. section 5. Treasurer. The Treasurer shall have the care and custody of all funds of the Authority and shall deposit the same in the name of the Authority in such bank or banks as the Board may select. The Treasurer and Assistant Treasurer shall sign all orders and checks for the payment of money and shall payout and disburse such moneys under the direction of the Board. The Treasurer shall keep regular books of accounts showing receipts and expenditures and shall render to the Board, at least annually (or more often when requested), an account of such transactions and also of the financial condition of the Authority. The Assistant Treasurer shall act as the Treasurer's agent and assistant to perform the above-described duties, subject to the Treasurer's approval thereof. Section 6. Additional Duties. The officers of the Authority shall perform such other duties and functions as may from time to time be required by the Board or the bylaws or rules and regulations of the Authority. section 7. Vacancies. Should the office of President, Vice-President, Treasurer, Assistant Treasurer, or Secretary become vacant, the Board shall elect a successor from its membership at the next regular meeting, or at a special meeting called for such purpose, and such election shall be for the unexpired term of said officer â&#x20AC;˘ . section 8.Âˇ _. Addi t.ional-Pe:r-sonnel-.--The-Boa:r;d--may from--time -to time employ such personnel as it deems necessary to exercise its powers, duties, and functions. The selection and compensation of such personnel shall be determined by the Board. ARTICLE III - MEETINGS section 1. Reaular Meetings. The Board may hold regular meetings according to a meeting schedule, if any, adopted or revised fromtil.l\e to timel>yresolutiqn of the J39ard. section 2. Special Meetings. Special meetings of the Board may be called by the President or any two (2) members of the Board for the purpose of transacting any business designated in the call. The call for a special meeting may be delivered at any time prior to the time of the proposed meeting to each member of the Board or may be mailed to the business or home address of each member of the Board at least two (2) days prior to the date of such special meeting. At such special meeting no business shall be considered other than as designated in the call, but if at least four (4) members of the Board

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Bylaws of the Northfield Economic Development Authority Page 3 are present at a special meeting, any and all business may be transacted at such special meeting. Notice of any special meeting shall be posted and/or published as may be required by law. section 3. Quorum. The powers of the Authority shall be vested in the Board. Three (3) Commissioners shall constitute a quorum for the purpose of conducting the business and exercising the powers of conducting the business and exercising the powers of the Authority and for all other purposes, but a smaller number may adjourn from time to time until a quorum is obtained. When a quorum is in attendance, action may be taken by the Board upon a vote of a majority of the Commissioners present. section 4. Order of Business. At the regular meetings of the Board the following shall be the order of business: a. b. c. d. e. f. g. ( \

Roll call. Approval of the minutes of previous meeting. Bills and communications. Reports. Unfinished business. New business. Adjournment.

All resolutions shall be written or transcribed and shall be retained in the journal of the proceedings maintained by the Secretary. Section 5. Adoption of路 Resolutions. Resolutions of the Board shall be deemed adopted if approved by not less than a simple majority of all Commissioners present, unless a different requirement for adoptlofi-is-prescri15ed15y-Taw~ Resolutions- may-out need bereaaaloud prior to vote taken thereon and may but need not be executed after passage. Section 6. Rules of Order. The meetings of the Board shall be governed by the most recent edition of Robert's Rules of Order. ARTICLE IV - MISCELLANEOUS Sectionl. Amendments to Bvlaws. The bylaws of the Authority shall be amended only by resolution approved by at least three (3) members of the Board. Section 2. Fiscal Year. The fiscal year of the Authority shall coincide with the fiscal year of the City of Northfield.

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY (EDA) iThursday, January 24, 1991 --- 4:00 p.m. City Hall AGE N D A 1.

Introduction of Board Members.

Bylaws of the EDA. A draft copy of the Bylaws for the EDA were previously sent to members for review and approval.

Election of Officers. Based on the bylaws, the following officers shall be elected by vote to serve the EDA: (a) President, (b) Vice-President, (c) Treasurer, (d) Assistant Treasurer, and (e) Secretary.

Purpose and Powers of the EDA. A copy of the state statutes regarding EDA's was previously sent to the members for review. Staff will summarize the purpose and powers of the EDA as described in Section 469 of the statutes (beginning with .090).

Goals and Objectives of the Northfield EDA. The EDA Goals Committee previously established a list that included a mission statement, seven objectives and specific powers for the Northfield EDA. These will be reviewed and discussed as they relate to the City Council, staff and project reviews.

Funding Mechanisms. The staff will review funding mechanisms that have been utilized for development/redevelopment projects within Northfield. Some information on tax increment financing (TIF), the development fund, and the community development block grant (CDBG) program were previously sent to the members. The EDA may also want to discuss funding source options for the overall operation of the EDA.

Economic Development Organizations. Staff will provide information on various other economic development organizations (local, regional and state) such as the Northfield Industrial Corporation (NIC), Economic Partners for Southeastern Minnesota (EPSEM), Partnership for Greater Minnesota, and the Star Cities program.

Other Business.

Adjourn.

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY (EDA) February 14, 1991 --- 4:00 p.m. City Hall MIN UTE S Members Present: Others Present:

Tom Clough, Dave Machecek, Mary Emery, Don Kuehnast, LaNelle Olsen, Fred Borgwardt and Moe Jeskey Dan Rogness and Ray Cox

The minutes of January 24, 1991 were approved on a motion by Borgwardt, seconded by Jeskey. Some members that were not present at the first meeting introduced themselves and gave some background information.

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Bylaws. Rogness informed the members that the attorney for Briggs and Morgan had prepared the bylaws at the time the enabling resolution was prepared for the Council. It identifies such items as officers and their responsibilities, meeting formats and a quorum number. After further discussion, a motion was made by Olsen and seconded by Kuehnast, to approve the proposed bylaws for the Northfield (EDA. A friendly amendment was also made by Olsen to 路allow staff to add language regarding the terms of office. The motion carried.

Terms ~f Office. Rogness indicated that the Council.resolution appointing the EDA members did not set terms for each person. The state statute requires that initial terms be set for 1, 2, 3, 4, 5 ahdtwo-6year terms. The Board agreed to put the two CciuncfT--members into their respective council term positions and the others wou~d be selected by alphabetical order. A motion was made by Emery, seconded by Borgwardt, to accept the following terms: I-year for Olsen, 2-year for Clough, 3-year for Borgwardt, 4-year for Emery, 5-year for Jeskey, and 6-years for Kuehnast and Machecek. The motion carried.

Officers. A list of five officers must be appointed by the EDA to serve one-year terms: president, vice-president, treasurer, assistant treasurer and secretary. All but the last two positionsmust be made from the Board membersh~p. The Board discussed whether some criteria should be used for selection such as a member of the Councilor the previous goals committee. After further discussion, the members agreed that a member of the goals committee would be better suited as president .and a council member as vicepresident. Kuehnast was nominated for President by Emery, seconded by Clough, and unanimously approved. Olsen was nominated for VicePresident by Emery,seconded by Jeskey, and unanimously a~proved. Emery was nominated for Treasurer by Olsen, seconded by Borgwardt, and unanimously approved. Karl Huber, Jr. was nominated for Assistant Treasurer and Dan Rogness nominated for Secretary by Borgwardt, seconded by Clough, and unanimously approved.

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EDA Procedures & Protocol

Section 7

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NORTHFIELD EDA PROCEDURES & PROTOCOL I. ORDER OF BUSINESS The EDA will conduct all business and action items at the first meeting of every month. The meeting agenda is as follows for all business meetings of the EDA: 1. 2. 3. 4. 5. 6. 7.

Call to Order Roll Call Approval of Minutes of previous meeting Presentations Action Items Discussion Items Adjournment

The second meeting of every month will be dedicated to Subcommittee Reporting and Work Session items. Action items will only be included on the agenda for time-sensitive items. II. MINUTES The Recording Secretary will include the discussion of agenda items and information that is factual and pertinent to the adoption of official business in the official minutes of every EDA meeting. All resolutions shall be written or transcribed and shall be retained in the journal of the proceedings maintained by the Secretary. III. CONDUCT OF MEETINGS The Bylaws of the Northfield Economic Development Authority states that EDA proceedings shall be conducted in accordance with the most recent edition of “Robert’s Rules of Order Revised.” The City Council specifies the current version of Roberts Rules, “Robert’s Rules of Order, 1990 Edition, 10th Edition.” IV. PREPARATION OF EDA MEETING AGENDA The agenda is prepared jointly by the President and Staff and will be distributed at least two (2) days prior to the meeting. EDA members have the ability to place an item on the agenda by verbal or written request to the President. V. ABSTAINING FROM VOTING Members who desire to abstain from voting on any matter before the EDA shall announce his/her intention to abstain prior to the President’s introduction of the resolution or ordinance. Immediately following the Member’s statement of his/her intention to abstain from voting, the may Member leave the meeting and then rejoin the EDA following the vote on the matter. Page 1 S:\Community Development\ECONOMIC DEVELOPMENT AUTHORITY\EDA By-Laws and Handbook\EDA procedures - amended 2007.doc

VI. CONFLICT OF INTEREST A potential conflict of interest arises when a public official has a personal interest in a decision the official is authorized to make. Certain kinds of conflicts are absolutely prohibited, and abstaining from discussion and voting can avoid other conflicts. Legal Counsel should be consulted if there is a question on whether or not a conflict of interest exists. VII. FILLING VACANT TERMS The following procedures are recommended for filling vacant EDA board terms: In case of the expiration of a term: • 45 days prior to the expiration of the term, the EDA will place an advertisement in the newspaper seeking interested candidates • The EDA will assemble the list of candidates and forward two names to the Mayor for consideration for each position opening. • As part of the process, qualifications will be identified and established to evaluate potential candidates. This information will also be forwarded to the Mayor as an explanation as to why particular candidates are being recommended. • The Executive Committee will also serve as the nomination committee – reviewing the applications and making a recommendation to the EDA prior to recommendations being sent to the Mayor. • The goal will be to have a candidate selected and appointed by the time the term expires. In case of a resignation: • The EDA will immediately advertise the opening in the newspaper seeking interested candidates. • The EDA will assemble the list of candidates and forward two names to the Mayor for consideration for each position opening. • As part of the process, qualifications will be identified and established to evaluate potential candidates. This information will also be forwarded to the Mayor as an explanation as to why particular candidates are being recommended. • The Executive Committee will also serve as the nomination committee – reviewing the applications and making a recommendation to the EDA prior to recommendations being sent to the Mayor. • The goal will be to have a replacement identified and appointed within 60-days of the resignation.

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Conflict of Interest Memo

Section 8

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Work Plan

Section 9

2010

Work Plan M ISSION S TATEMENT Operating under the authority of the City Council, the EDA shall be the chief economic development agency for the City.

G OALS Improve the economic condition of Northfield through appropriate commercial and industrial development, thus creating a higher tax base and further job opportunities, all in ways that meet the guidelines of the City’s Comprehensive Plan. Approved by the Northfield City Council Resolution 90-292, September 17, 1990

YEARS 2010 BOARD MEMBERS JENELLE TEPPEN, PRESIDENT STEVE ENGLER, VICE PRESIDENT RHONDA POWNELL, SECRETARY/TREASURER RICK ESTENSON JIM POKORNEY VICTOR SUMMA

2010 Economic Development Authority Work Plan Adopted, March 11, 2010 Resolution 2010-005

Jody T. Gunderson, Director • Northfield City Hall • 801 Washington Street • Northfield, MN 55057-2598 Direct 507.645.3018 • Mobile 612.968.6407 • Fax 507.645.3055 • Email Jody.Gunderson@ci.northfield.mn.us

YEARS Economic Development Authority

20 YEARS Index

Page 2010 Ad Hoc Work Group Assignments .......................................................................... 3 Introduction ....................................................................................................................... 4 Rice County Economic Impact Analysis .......................................................................... 5 Outline from EDAâ&#x20AC;&#x2122;s Strategic Planning Retreat............................................................... 8 Business Park Development ............................................................................................. 10 Business Recruitment, Marketing, and Public Relations .................................................. 14 Infill & Redevelopment .................................................................................................... 18 Business Retention and Expansion ................................................................................... 21

Northfield Economic Development Authority (EDA)

2010 Work Plan

20 YEARS City of Northfield | Economic Development Authority 2010 Ad Hoc Work Group Assignments Executive

Infill and Redevelopment

Business Recruitment Marketing

Business Park Development

Business Retention and Expansion

Jody Gunderson, Dir.

Fed/State/Cnty President

Steve Engler

V.P.

Rhonda Pownell

S/T

Rick Estenson

Lead Member Member Member

Jim Pokorney Victor Summa

Member Lead

Member

Lead

Vacant Support Organization

Chamber of Commerce, NDDC, City Staff

Janelle Teppen,

Additional Responsibility

Fed/State/Cnty BRE CVB NEC, BRE CVN NDDC

NEC

NDDC Chamber of Commerce

Business Park Master Plan Committee Consultant Hoisington Koegler Group Inc.

Jeff McMenimen Project Manager

Mark Koegler Principal in Charge

Steering Committee

Rick Estenson Jim Pokorney Rhonda Pownell Erica Zweifel

Tracy Davis Tim Geary Christopher Sawyer Neil Lutsky

Technical Committee

Jody Gunderson Brian Oâ&#x20AC;&#x2122;Connell

Dan Olson Katy Gehler

Northfield Economic Development Authority (EDA)

2010 Work Plan

Mike Berthelsen Pete Sandberg Scott Richardson Jay Jasnoch

20 YEARS INTRODUCTION “Economic development“ is defined by the International Economic Development Council (IEDC) by stating main objectives and describing it as a process. The most commonly used objectives are the creation of jobs and wealth, and improving the quality of life. Economic development is a process that influences the growth and restructuring of an economy to enhance the economic well-being of a community. Simply stated, the desired result of effective economic development is the creation of wealth for a particular community or region. How an economic development agency achieves this goal is in large part determined by the strategy that has been formulated and its prudent use of limited resources. However, the process is client driven and in today’s fast-paced environment, happens very quickly. The ability to respond to the client’s needs is essential to effectively compete for the opportunity to retain the company or to be considered as a location by the client.

ECONOMIC IMPACT

Economic impact is defined as new dollars injected into the economy of the community, county, region, and state. In general, the impact is tracked through the following measures:

   

New jobs—payroll Existing jobs—payroll New property tax collection Increase in tax collection (sales, corporate, employment, utility, road use)  Multiplier effect on region (housing starts, buying power, multiplier varies 1.5 to 3 times the project investment)  Increase in school enrollment

Economic development efforts typically focus on policies and programs in three major areas: •

Government policies that undertake the broad economic objectives including employment, health care, sustainable growth, and inflation control. Inflation control for economic development is to expand the economic base which would allow the levy rates for the cost of government services to remain stable.

•

Infrastructure policies and programs that provide services including: building transportation, sewer, water, electric, and natural gas systems; enhancement of quality-of-life services such as recreational facilities, parks, lakes, and trails; and providing development of arts and cultural facilities.

•

Business climate policies and programs directed at improving conditions through specific efforts such as: business finance, marketing, neighborhood development, business retention and expansion, technology transfer, and real estate development.

There is no single strategy, policy, or program for achieving successful economic development. Communities differ in their geographic and political strengths and weaknesses; therefore, each community has a unique set of challenges for economic development.

Northfield Economic Development Authority (EDA)

2010 Work Plan

20 YEARS RICE COUNTY ECONOMIC IMPACT ANALYSIS University of Minnesota Extension Center for Community Vitality, November 2009

The University of Minnesota Extension Center for Community Vitality, under the direction of Ms. Brigid Tuck, Mr. Bruce Schwartau, and Mr. David Nelson, completed an economic impact analysis for Rice County in November of 2009. This was study was a collaboration between the University of Minnesota, Rice County Economic Development, and Rice County communities.

Employment by Major Industry Rice County 2007

The Economic Impact Analysis was designed to assist communities in making informed economic development decisions. The impact analysis features the QuickTake 100 which highlights the economic impact in a designated county of 100 jobs in a selected industry. Along with the QuickTake 100, the impact analysis also provides an overview of the current economic structure of the county.

Interpreting the Results

Labor Income by Major Industry Rice County 2007

The following table details how 100 jobs in each of the selected industries impacts the Rice County economy. Additionally, each of the selected industries highlights the direct impact of 100 jobs, the indirect and induced impacts created by those 100 jobs, and the top three â&#x20AC;&#x153;other industriesâ&#x20AC;? affected (Table 1.0). Each page of the Economic Impact Analysis features an important note about the industry and its impacts on the local economy. The report also demonstrates how much output and labor income is generated (including direct, indirect, and induced impacts) by 100 jobs in that industry. Finally, the report features a bar chart that shows how many jobs in the industry currently exist in the county and illustrates how 100 jobs will change overall industry employment.

Northfield Economic Development Authority (EDA)

2010 Work Plan

20 YEARS Table 1.0

Rice County QuickTake 100 Breakfast Cereal Manufacturing Veterinary Pharmaceutical Manufacturing Glass Manufacturing Surgical/Medical Manufacturing Computer Software Development Computer Data Warehousing Circuitry Manufacturing Wholesale Trade Truck Transportation Wind Component Manufacturing Fabricated Metal Manufacturing Medical and Diagnostic Labs and Outpatient Care Construction of New Nonresidential Commercial Structures Grain Agriculture Retail Trade – General Merchandise Agricultural Support Activities Retail Trade – Hobby, Sporting Goods, Books and Music Nursing and Residential Care Facilities (1) Retail Trade (2) Real Estate (3) Wholesale Trade

Number of Jobs Created

Indirect Impact

Induced Impact

Total Impact

Top 3 Industries Affected by Job Creation

100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100

76 81 45 49 49 35 34 21 26 26 19 15 14 15 6 1 4 4

48 49 39 34 34 32 32 30 23 22 26 21 20 7 10 14 7 6

224 230 184 183 183 167 166 151 149 148 145 136 134 122 116 115 111 110

(1), (3), (4) (1), (3), (5) (1), (3), (5) (1), (5), (6) (1), (6), (8) (1), (6), (7) (1), (3), (5) (1), (6), (7) (1), (4), (7) (1), (3), (6) (1), (6), (7) (1), (6), (7) (1), (6), (7) (1), (2), (9) (1), (6), (7) (1), (6), (7) (1), (3), (4) (1), (6), (7)

(4) Transport/Warehouse (5) Manufacturing (6) Lodging/Food Service

(7) Health/Social Serv. (8) Admin/ Waste Serv. (9) Ag/Forestry/Fish

Understanding the Terms Employment: includes full- and part-time workers and is measured in annual average jobs. Total wage and salaried employees as well as the self-employed are included in employment estimates in IMPLAN. Because employment is measured in jobs and not in dollar values, it tends to be a very stable metric. Direct Impact: is equivalent to the initial change in the economy. For the QuickTake 100, the direct impact is 100 jobs. Indirect Impact: The indirect impact is the summation of changes in the local economy that occur due to spending for inputs (goods and services) by the industry or industries directly impacted. For instance, if employment in a manufacturing plant increases by 100 jobs, this implies a corresponding increase in output by the plant. As the plant increases output, it must also Northfield Economic Development Authority (EDA)

2010 Work Plan

20 YEARS purchase more of its inputs, such as electricity, steel, and equipment. As it increases its purchase of these items, its suppliers must also increase its production, and so forth. As these ripples move through the economy, they can be captured and measured. Ripples related to the purchase of goods and services are indirect impacts. Induced Impact: The induced impact is the summation of changes in the local economy that occur due to spending by labor by the employees in the industry or industries directly impacted. For instance, if employment in a manufacturing plant increases by 100 jobs, the new employees will have more money to spend to purchase housing, buy groceries, and go out to dinner. As they spend their new income, more activity occurs in the local economy. This can be quantified and is called the induced impact. Total Impact: The total impact is the summation of the direct, indirect and induced impacts. The purpose of conducting the Economic Development Impact Analysis for Rice County was to provide a quantitative analysis each community could use to make more informed decisions about what type of impact their investments may have to their respective communities. When evaluating the impact study in reverse, it also demonstrates what sectors of the economy are impacted by the loss of jobs in a particular business sector.

Northfield Economic Development Authority (EDA)

2010 Work Plan

20 YEARS ECONOMIC DEVELOPMENT AUTHORITY Outline from EDA’s Strategic Planning Retreat The EDA held its annual strategic planning retreat on October 28, 2009, to review its successes for the year, the elements that contributed to their success, areas requiring improvement, and initiatives the Board would like to undertake in 2010.

EDA SUCCESSES IN 2009  Collaboration with partner organizations to accomplish 2009 initiatives. The EDA recognized the need to engage other organizations to assist with the implementation of their work plan. The EDA delegated certain responsibilities in order to concentrate on more pressing matters;  Awarded three micro grants to support the growth of existing businesses;  The EDA sponsored a forum that introduced community leaders to a team of individuals intimately involved with the redevelopment of downtown Holland, Michigan. Northfield leaders were very receptive to learning those issues the Holland group confronted during the redevelopment process;  The EDA assisted the City advance the annexation of property west of the hospital and began work on the business park(s) master plan for this area;  Willingness to invest money for professional services, and the willingness of the Board to devote their time and energy, was critical components in the success of implementing the EDA’s work plan;  The EDA successfully recruited StrataPoint to locate company in Northfield. A number of community assets were accessed exclusive from the City’s master plan loan program;  Business Retention and Expansion visits demonstrated the EDA’s interest in listening to the concerns of local businesses to determine how the EDA may assist;  The Board viewed their continuing efforts to establish face to face contact businesses as a contributing factor in the EDA’s success;  Updates to the website, more specifically the addition of available property and lease space to the toolbox section of the EDA’s website;  The participation and the utilization of City staff’s professional skills contributed to the overall success of the organization;  Modifying EDA’s loan program in response to current economic conditions.

ELEMENTS CONTRIBUTING TO THE SUCCESS IN 2009         

Ability to clearly delegate specific areas of responsibility Willingness to learn from others Willingness to spend money for expertise Council and EDA in step with each other and seeking a common goal High level of energy and hard work Development of personal relationships through face to face interactions Leveraging Public/Private partnerships Leveraging community assets, not just financial incentives Leveraging skills of City Staff

Northfield Economic Development Authority (EDA)

2010 Work Plan

20 YEARS AREAS REQUIRING IMPROVEMENT            



The EDA must get better acquainted with and understand the needs of Northfield’s top ten employers; Continue to learn from the experiences of other communities; Become a more innovative thinking organization; Gain a better understanding of the real economic drivers of area businesses; Foster an environment where businesses want to come to Northfield; sell the community assets; Acknowledge and discuss tough topics; With limited capacity, make sure focus is on key issues where capacity exists to properly address the issue; Becoming more proactive, rather than reacting to situations, especially with respect to needs of local businesses; Provide a clear understanding of how the EDA will get things done. In particular, look to delegate responsibility to staff and partners and leverage Economic Development Director position; Need carriers of the vision over the long term, this will ensure continuity and follow through; Need to focus on adopting, rather than accepting , recommended action to help ensure follow through and accountability; The EDA Board must be clear about its expectations for each action area, including timeframe, deliverables and action plan. This would mean managing more like taskforce rather than a standing committee; Clarify what City Council expects from the EDA on future annexation efforts and potential business park development.

WHAT INITIATIVES THE EDA WILL UNDERTAKE IN 2010 The EDA Board reserved the remainder of the retreat to discuss the key initiatives they would like to address in 2010. The Board also discussed what financial commitments would be required in order to achieve the desired results. On February 25, 2010, the Board approved the EDA’s Work Group assignments and instructed members to work within their assigned group over the following week to complete the draft version of the 2010 EDA Work Plan. The Board returned on March 11, 2010, and discussed the merits of each initiative and adopted their 2010 Work Plan.

Northfield Economic Development Authority (EDA)

2010 Work Plan

20 YEARS Business Park Development The Economic Development Authority Board members approved the Business Park Development Committeeâ&#x20AC;&#x2122;s recommendation on July 30, 2009, and entered into a Professional Service Agreement with Hoisington Koegler Group, Inc. (HKGi) for master planning of the proposed business park(s). The EDA requested and received guidance from Mr. Mark Koegler regarding what type of representation would be beneficial to have on the Steering/Technical Committee. Mr. Koegler advised the EDA Board to assemble a team of individuals with a broad spectrum of experience from the community. The EDA Board unanimously approved resolution 2009-014 appointing the following individuals identified in table 1.1 to the Business Park Master Plan Steering /Technical Committee.

STEERING COMMITTEE 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12.

Rick Estenson ........................ Jim Pokorney ......................... Rhonda Pownell .................... Erica Zweifel ......................... Tracy Davis ........................... Tim Geary ............................. Christopher Sawyer ............... Neil Lutsky ............................ Pete Sandberg ........................ Scott Richardson ................... Jay Jasnoch ............................ Mike Berthelsen ....................

Background

Table 1.1

Economic Development Authority Economic Development Authority Economic Development Authority City Council Member Planning Commission Board Member Plant Manager Malt-O-Meal/Resident of Northfield Chamber of Commerce Board Member/Businessman Carleton College St. Olaf College/Resident of Northfield Northfield Hospital/Resident of Northfield Developer/Architect/Resident of Northfield Northfield Public School Board Member/ VP for Facilities Management at University of Minnesota/Resident of Northfield

TECHNICAL SUPPORT 1. 2. 3. 4.

Jody Gunderson ..................... Brian Oâ&#x20AC;&#x2122;Connell .................... Dan Olson.............................. Katy Gehler ...........................

Economic Development Director Community Development Director City Planner Engineering Director

The Steering and Technical Committee are expected to provide the following attributes for the master planning process: 1. Steering Committee should represent the various interests and values of the community and the organizations they represent; 2. Communication link between the planning process and the stakeholders within the community; 3. Provide direction to staff and the consultant team on the process and scheduling of the planning effort; 4. Serve as an Advisor on plan content. Broader public input is essential to informing people of the master plan and its guidelines, however, the steering committee may be asked to offer preliminary input on plan alternatives in preparation for broader public meetings; 5. Where appropriate, participation and involvement in workshops and charrettes throughout the planning process. Committee members may be asked to work with community organizations and businesses in getting the word out about public events related to the planning process. Northfield Economic Development Authority (EDA)

2010 Work Plan

20 YEARS

The EDA began the Master Planning process in September of 2009. Jeff McMenimen, Director of Design, Hoisington Koegler Group, Inc., presented the schedule for the master planning process at the November Steering/Technical meeting. The Committee will meet throughout the year as the master plan for the Business Park(s) evolves. The consultants anticipate delivery of the final draft of the master plan to the Cityâ&#x20AC;&#x2122;s Planning Commission and Council in October of 2010.

Northfield Economic Development Authority (EDA)

2010 Work Plan

20 YEARS BUSINESS PARK DEVELOPMENT…CONTINUED Summary of 2010 Initiatives 1. Complete work on Business Park Master Plan 2. Provide support to the City as it works through annexation issues related to the Prawer/Gill properties 3. Identify infrastructure financing options 4. Develop Phasing Scenarios 5. Promote the adoption of the final master plan to the Planning Commission and City Council 6. Determine ownership of implementation of master plan and prepare for implementation 1. Complete work on Business Park Master Plan: The City Council and the Economic Development Authority has identified the completion of the Master Plan for the Business and Industrial Park as a priority to the City. The Master Plan process began in September of 2009 and adoption of the plan is expected to occur by November of 2010. 2. Provide support to the City as it works through annexation issues related to the Prawer/Gill properties: The Northfield Planning Commission voted to recommend that the City Council approve the Prawer/Gill annexation request at their January 7, 2010, Commission meeting, and on February 9, 2010, the City Council instructed the Northfield City staff to work with representatives of Bridgewater Township on an amendment to the existing annexation agreement. The Northfield EDA approved amending their professional service agreement with HKGi to include master planning services related to the Prawer/Gill properties at their February 11, 2010, Board meeting. Given the financial investment the EDA has invested in the Prawer/Gill properties, it would be in the best interest of the EDA to continue to serve in a supporting role for the City. 3. Identify infrastructure financing options: HKGi will be outlining potential funding options the City may employ to develop infrastructure for the Business Park. Specific work to be performed in this task includes:  Review existing City programs and policies. The purpose of this review is to understand how existing policies influence the use of various public finance tools. Existing finance programs, such as tax increment financing districts, may provide resources for implementation;  Review planned investments. The previous tasks identified infrastructure investments required for the development of the business and industrial park area. A clear understanding of these investments is needed to connect them with the tools available to Minnesota cities. The cost and timing estimates will be used for the analysis of finance options;  Build the "tool box". We will create an inventory of public finance tools available to undertake public investment to implement the Master Plan. Our investigations will look beyond the traditional tools and explore grant programs, tax credits, and new bonding options from the American Recovery and Reinvestment Act. This inventory is intended to serve as a reference for future planning and decision making. Information to be included in the tool box includes: Statutes, Activities that can be funded,

Northfield Economic Development Authority (EDA)

2010 Work Plan

20 YEARS Revenues accessed through this tool, Ability to borrow, Key limitations, Availability of State credit enhancement, Impacts on tax-exempt status of bonds, Process requirements. 4. Analyze the financial implications: This task will be more than just an inventory of tools. Analysis and investigation is needed to better understand the potential financial implications of finance options. This task will be used to create and analyze finance strategies for alternative public investment plans. An important focus of this task will be the public and private costs associated with the options. 5. Prepare finance strategies: The information created in this task leads to finance strategies for implementation of the Master Plan. The strategies will focus on the following questions: Which tools are best suited to particular investments? What specific steps should be taken to coordinate finance with overall implementation? How could the Plan be enhanced with legislative change? 6. Develop phasing strategy: The purpose of this task is to provide the City with a feasible plan to phase development within the industrial/business parks. The Hoisington Koegler Group team will draw from the expertise of it's consultant team members and Steering/Technical Committee to prepare a phasing strategy for developing the industrial/business parks to achieve financial success in the marketplace. The phasing strategy will address the costs associated with development and providing infrastructure to the site(s) to service them for the anticipated development. It will also take into consideration the anticipated absorption expectations of various components of the proposed development. 7. Promote the adoption of final Master Plan to Planning Commission and City Council: Upon approval by the Technical/Steering Committee of all major aspects of the master plan, development standards and implementation strategies, the HKGi team will prepare the final master plan documents. The final Master Plan report will be drafted and supplemented with narrative in a report style plan. The report will include project inventory graphics, market analysis, concept alternatives, master plan recommendations and plans, development standards, financial analysis and implementation strategies. Members of the Steering/Technical Committee will be expected to address any concern expressed by the Planning Commission and City Council in an effort to secure its adoption. 8. Determine ownership of implementation of master plan and prepare for implementation: To ensure that the work and investment that went into the final business park master plans are advanced to the next stage of development, it is incumbent upon the EDA Board, City staff , and Northfieldâ&#x20AC;&#x2122;s elected officials develop a course of action and the role of each party.

Northfield Economic Development Authority (EDA)

2010 Work Plan

20 YEARS BUSINESS RECRUITMENT, MARKETING, AND PUBLIC RELATIONS Collateral Marketing Material Updating and enhancements to a prospect response packet is a priority in the economic development organization’s program of work. This is a continuous process and requires attention to the following elements: available buildings and sites, demographics, workforce, financial programs, locational advantages, infrastructure capacity, transportation network, and quality-of-life materials.

Marketing Like any company, if a consumer is not familiar with your product, they are less likely to purchase it. A function of an economic development organization is to market the community/region to businesses in targeted industries. Marketing should include both internal and external activities. Communities market to achieve multiple economic development objectives, including: • • • •

Attraction, retention, and expansion of businesses Attraction and retention of residents and tourists Improvement of the community's image locally, nationally, and internationally Promotion of policies and programs

Marketing may feature the community as a whole, individual properties or sites, particular neighborhoods, specific programs and policies, or business sectors. From an economic development point of view, attracting one major business to the community may revitalize an economy by creating jobs, spinning off ancillary businesses, and changing the image of the community as a business-friendly area. Many organizations contribute to a community's marketing activities—state and local governments, chambers of commerce, local businesses, regional organizations, community development corporations, and convention and visitors bureau. The degree to which these organizations coordinate their activities around a common vision is a critical determinant of marketing success.

Northfield Economic Development Authority (EDA)

BUSINESS CLIMATE A community’s business climate is the policies and programs established in the state, county, and locality that a company has to follow when conducting business in that jurisdiction. Ultimately, a good business climate allows businesses to conduct their affairs with minimal interference while maximizing return on investment. While no business climate is perfect for every kind of company, certain attributes of the regional or local economy allow investors to find fewer risks and higher returns when compared to other places. Key factors used in the measure of business climate include:

            

Business and income tax levels Workforce costs, availability, and skill sets Utility costs Market proximity and size Quality of services Cost of living Quality of life Environmental regulation Permitting, licensing, and various reporting regulations Real estate costs and availability Infrastructure availability and capacity Access to financing and capital Incentives

2010 Work Plan

20 YEARS Branding We can define â&#x20AC;&#x153;brandâ&#x20AC;? as the sum of all available information about a place, product, or service. The brand conveys information in two ways. The first is through direct experience with the product. The second way is through the various communication drivers that communities use to shape perceptions such as: advertising, public relations, name, logo, environment, and packaging. Many variables are involved in the positioning of brands in the marketplace, but the three components essential to developing a clear brand definition are vision, meaning, and parameters of relevance. 1. Vision: Encompasses both of the brand's roots, why you are in business and where your company is headed. 2. Meaning: A brand's meaning is just that: what your brand represents to the marketplace. Meaning is generally manifested in establishing desired image attributes that drive all decisions about the brand. If you, the marketer, have only a dim notion of what your brand is about, you can be sure that your target market is totally in the dark. 3. Parameters of Relevance: The parameters of relevance are simply the limits to which you can extend your brand beyond its core meaning without compromising your credibility. It involves understanding what your brand is and what it isn't. Your ability to move successfully into new areas depends on whether you choose the right new areas and if they align with the vision. Branding incorporates many things to convey a message, but brand positioning is first and foremost about customersâ&#x20AC;Śthe people who buy your product or service and keep you in business.

Northfield Economic Development Authority (EDA)

2010 Work Plan

20 YEARS BUSINESS RECRUITMENT, MARKETING, AND PUBLIC RELATIONS…CONTINUED Summary of 2010 Initiatives 1. Continue development of community marketing print materials including newsletter, eletter, and stories of local businesses 2. Enhance marketing capabilities of City’s website, fully implement StrataPoint software 3. Leverage Business Park Master plan business marketing report for citywide recruitment program 4. Improve and promote media relations of Economic Development Authority 5. Develop marketing piece for the purpose of soliciting State and Federal funding for Business Park infrastructure 6. Organize major employer appreciation and recognition gathering 7. Develop community-wide marketing video 1. Continue development of community marketing print materials including newsletter, enewsletter, and stories of local businesses: A quarterly newsletter can serve a number of purposes for an economic development agency.  It can be used to inform businesses, site selectors, realtors, and developers of the economic development initiatives underway in the community (new or expanding business operations).  A newsletter may also assist the community to convey a particular message or brand for the community  Stories about local business success will promote the EDA as an effective organization and promote the community as a business-friendly place to operate a business.  An e-newsletter is not just the same content you would put in a printed newsletter, then cut-andpasted to an e-mail message. The Internet is a different communications environment and requires a different writing style. People do not read long documents online, they scan to find something relevant or interesting to them. E-newsletters should be kept to three screens or less, and formatted to be scannable. E-newsletters are like sound bites of the Internet allowing people to be “information snackers.” 2. Enhance marketing capabilities of City’s website, fully implement StrataPoint software: In 2009, StrataPoint Inc. relocated its operations to Northfield. During the City’s negotiations with the company it was determined that there may be a way that the EDA can accomplish its desire to have an advanced property search web based platform for development properties and leasable office space in the community. City staff has met with representatives of StrataPoint Inc. and believe that this platform may be available as early as spring of 2010. 3. Leverage Business Park Master Plan marketing report for citywide recruitment program: The Business and Industrial Park marketing strategy and marketing framework plan will include real estate trends and characteristics affecting development of the Northfield project. Types of businesses and industries being sought for the Northfield site will be identified and specific types of businesses and industries will be evaluated, confirmed and documented. Key state and local agencies and organizations that should be engaged in joint marketing will be identified. Recommendations shall also be made to inform various representatives, including site location consultants, commercial/industrial brokers and developers about Northfield, and how Northfield Economic Development Authority (EDA)

2010 Work Plan

20 YEARS to engage them in its future development. A dynamic and ongoing marketing program for Northfield will need to include a comprehensive branding and marketing strategy to maximize market awareness and interest in the park's development opportunities. Various print and electronic media materials will be initially profiled and introduced in the marketing strategy/framework plan. 4. Improve and promote media relations of Economic Development Authority: The City Council has identified the EDA as the lead economic development agency for the City of Northfield. It is important that the EDA comport itself in a manner that instills the confidence by the City’s elected officials, businesses, and residents. This can be accomplished through many methods but most noticeably is how the EDA’s operations and work are portrayed by the media. The EDA needs to identify those areas requiring improvement, and develop a strategy to convey its message. 5. Develop marketing piece for the purpose of soliciting State and Federal funding for Business Park infrastructure: The EDA is currently working to complete a master plan for a Business Park located just west of the Northfield Hospital. HKGi consulting firm has been hired to develop a conceptual plan for the newly annexed property, as well as identify financial instruments that may be utilized to provide infrastructure to the property. City staff have been involved in acquiring funding for these types of projects and believe that a marketing piece should be developed outlining the project and presenting a case for State or Federal funding. 6. Organize major employer appreciation and recognition gathering: Statistically the majority of business and employment growth occurs with existing companies nationwide. It is imperative that the EDA recognize the important role the major employers have in the continuing success of our community. Organizing an event with representatives of major employers in the community will provide an opportunity to recognize Northfield companies and an opportunity to network with key decision makers. 7. Develop community wide marketing video: A video produced by the Holland, MI group sparked an interest in a similar production highlighting Northfield’s distinctive qualities. An informal group representing some of the community’s most visible institutions continues to meet and discuss the project. It is expected that a modest request for EDA financial support will be forthcoming in early 2010.

Northfield Economic Development Authority (EDA)

2010 Work Plan

20 YEARS INFILL & REDEVELOPMENT Infill and redevelopment are compact forms of development that use land and other resources efficiently to improve and create more livable communities.

THE SIX MOST COMMON OBSTACLES TO INFILL AND REDEVELOPMENT

Infill is the construction of new buildings within existing urban areas on vacant or underutilized parcels of land. It may be as simple as building a single family home on one lot in an established neighborhood or as complex as creating a mixed-use center for offices, housing and retail on a much larger piece of land. Infill parcels are generally located in areas with water, sewer, transportation and other services in place. Redevelopment is finding new or more intensive uses for land or buildings within an existing urban area. It may involve replacing existing structures with new ones or converting them to new uses. Redevelopment also can result in a change in use, such as replacing existing homes with apartments or building a restaurant on a parking lot. Redevelopment is typically market-driven.It usually occurs when a developer or community group determines that a new use for a site will be more profitable or productive than the current use. The Economic Development Authority’s Infill and Redevelopment Work Group’s goal is to support existing businesses and attract new businesses to available properties within the City. This would maximize existing infrastructure while increasing the commercial and industrial tax base.

Northfield Economic Development Authority (EDA)

1. Infill and redevelopment projects often cost more to build than raw land projects 2. Policymakers tend to overlook the public cost‐savings of infill and redevelopment 3. Largely due to past experience with poor quality examples, many community members actively oppose infill and mixed‐use projects 4. Developers often avoid infill or redevelopment projects in inner‐city neighborhood due to fear of reduced marketability 5. Finance and capital markets can be a barrier to the infill developer 6. Zoning for separate uses has gone too far

Source: The Infill and Redevelopment Code Handbook: Oregon Department of Land Conservation and Development September 1999

2010 Work Plan

20 YEARS INFILL & REDEVELOPMENTâ&#x20AC;ŚCONTINUED Summary of 2010 Initiatives 1. Develop complete listings of available existing as well as vacant infill commercial properties, both for rent and for sale 2. Identify potential funding programs to advance in-fill and redevelopment 3. Develop policy relating to EDA's desire to purchase some key properties to hold for opportunity, or control of development. Explore funding sources for acquiring these properties 4. Determine whether EDA may invest in the Northfield Real Estate Fund 5. Monitor in-fill and redevelopment efforts of other organizations, and new business inquiries that come to Economic Development Director. Support staff in this effort 6. Evaluate and support private sector infill initiatives 7. Be pro-active in evaluating various projects that might come before the Council and the Planning Commission 8. Work with City Council and Staff to identify key sites for municipal or public buildings or public projects 9. Provide specific suggestions regarding Marketing efforts: e.g. Public Relations and marketing materials to support the InFill and Redevelopment work group (EDA) agenda efforts to market infill development 10. Sponsor forums on issues important to the advancement of economic development

1. Develop complete listings of available existing as well as vacant infill commercial properties, both for rent and for sale: In 2009, StrataPoint Inc. relocated its operations to Northfield. During the Cityâ&#x20AC;&#x2122;s negotiations with the company, it was determined that there may be a way that the EDA can accomplish its desire to have an advanced property search web based platform for development properties and leasable office space in the community. Once fully developed the web site will include available commercial and industrial property through-out the city for lease and rent. 2. Identify potential funding programs to advance in-fill and redevelopment: The EDA evaluated potential funding programs in 2009. The EDA will need to develop a loan program to replace the master development loan due to the expiration of the master plan district in 2013. The Infill and Redevelopment Work Group will evaluate the needs of businesses in our current economic environment and develop programs that apply to infill or redevelopment projects. 3. Develop policy relating to EDA's desire to purchase some key properties to hold for opportunity, or control of development. Explore funding sources for acquiring these properties: There has been some discussion among EDA Board whether it is appropriate for the organization to purchase property for development and redevelopment purposes. The Infill Work Group will develop a policy to assist the Board in evaluating the merits of a property purchase. Northfield Economic Development Authority (EDA)

2010 Work Plan

20 YEARS 4. Determine whether EDA may invest in the Northfield Real Estate Fund: Recently a local investment group was formed with the expressed purpose of investing in properties primarily in the Northfield Downtown Business District. The Infill and Redevelopment Work Group will investigate whether investing in this fund is legally permissible, and if permissible, the pros and cons of the EDA investing in such a fund. Representatives of the Northfield Real Estate Fund will be invited to a meeting to provide information and respond to questions. 5. Monitor in-fill and redevelopment efforts of other organizations, and new business inquiries that come to Economic Development Director. Support staff in this effort: There are a couple of organizations and groups that have expressed interest in the redevelopment throughout the City of Northfield. The Infill and Redevelopment Work Group believes that it is important that the EDA coordinate its infill initiatives with those groups in order to develop a cohesive plan for infill and redevelopment. 6. Evaluate and support private sector infill initiatives: The Infill and Redevelopment Work Group will evaluate the merits of infill and redevelopment projects and recommend that the EDA take a proactive support for the project if it is appropriate. 7. Be pro-active in evaluating various projects that might come before the Council and the Planning Commission: In recent years the City has undertaken evaluations involving projects throughout the City (i.e. Public Safety Center, Skate Park, and Liquor Store). The Infill and Redevelopment Work Group will identify projects the EDA would like to serve as a resource for the City. 8. Work with City Council and Staff to identify key sites for municipal/public buildings or public projects: In recent years the Northfield’s municipal and public buildings have undergone evaluation by the City’s elected officials. The Infill and Redevelopment Work Group would like to advocate that the EDA Board be included in the City of Northfield’s site selection process. 9. Provide specific suggestions regarding Marketing efforts: e.g. public relations and marketing materials to support the InFill and Redevelopment Work Group (EDA) agenda efforts to market infill development: Since the Business Park is still being master planned by the City, all marketing efforts will effectively involve the marketing of infill or redevelopment sites. The Infill and Redevelopment Work Group believes that they should be providing input to marketing efforts advanced by the Business Recruitment, Marketing, and Public Relations Work Group. 10. Sponsor forums on issues important to the advancement of economic development: The EDA will seek out opportunities to host forums on issues it believes are important to advance the economic development initiatives for the City of Northfield. The forums will be designed to provide information to the EDA Board, elected officials, and residents of Northfield.

Northfield Economic Development Authority (EDA)

2010 Work Plan

20 YEARS BUSINESS RETENTION AND EXPANSION PROGRAM Nationally, 80 percent of new business growth is generated from existing companies. Without fostering an existing business program, your community's best companies could be your competitor's best prospects. The purpose of a business retention and expansion program is to establish relationships between community businesses and economic developers to strengthen existing companies, establish early warning systems to flag at-risk businesses that require assistance, and ensure that public programs meet local business needs. Business retention initiatives usually include a mechanism for linking expanding businesses with public programs designed to mitigate growing pains and regulatory issues. Retention programs involve educating the stakeholders, recognition events, headquarter calls, periodic surveys, interviews, and visitations with companies to evaluate the assets and opportunities. Many economic development professionals describe the importance of an existing business survey tool as “the ability to gather strategic information for marketing which should become a top priority for every development organization. Internal information resources should create opportunities and anticipate changes that impact businesses within a community. The emphasis of the retention survey instrument should be on capturing three types of information: customer satisfaction, predictive information, and marketing research.” Without an effective retention and expansion program, opportunities will be lost. Increasing the return on investment from your retention and expansion effort will enhance the value. The intent is to tap into the knowledge of area executives cultivating business strategy information that will identify opportunities for the community and economic development organizations to promote or enhance.

Northfield Economic Development Authority (EDA)

OBJECTIVES OF A BUSINESS RETENTION AND EXPANSION PROGRAM 1. To demonstrate to local businesses that the community appreciates their contributions to the local economy 2. To help existing businesses solve problems 3. To assist businesses in using programs aimed at helping them become more competitive 4. To anticipate future local business issues and trends and develop strategies to address these 5. To build community capacity to sustain growth and development 6. To specifically identify those businesses poised to expand that need assistance to grow 7. To develop collaborative relationships for participating in comprehensive long-range retention and expansion activities 8. To identify opportunities to attract support businesses

2010 Work Plan

20 YEARS BUSINESS RETENTION AND EXPANSION PROGRAM…CONTINUED Summary of 2010 Initiatives 1. Enhance local business database to track business conditions 2. Conduct BR&E visits with top ten employers 3. Facilitate the growth and expansion of existing businesses by advocating on their behalf 1. Enhance local business database to track business conditions: The Northfield Chamber of Commerce, Northfield Downtown Development Corporation, and the Northfield city staff have all made it a practice to meet with representatives of existing businesses throughout the year and discuss the economic status of their company. During those visits a considerable amount of information is collected, but is not documented in a standardized format. The EDA will meet with its partners to determine if a standardized format can be developed. This would provide a tool for the economic development organizations to better monitor the economic conditions of Northfield’s businesses and address any on-going issues they may be experiencing. 2. Conduct BR&E visits with top ten employers: Over the last couple of years the nation’s businesses have experienced tumultuous economic times. Given the uncertainty of the economy, it is more important now than ever before that the City foster a strong working relationship with Northfield’s companies. The Rice County Economic Impact Analysis completed in November of 2009 clearly demonstrates the ripple affect major employers have on the retail and service sectors of our local economy. Northfield’s city staff, NDDC, and Chamber of Commerce will meet with the community’s major employers and determine what, if any, assistance they require to strengthen and grow their operations. 3. Facilitate the growth and expansion of existing businesses by advocating on their behalf: In recent years, a number of Northfield’s companies have expanded their operations in the community. The expansion of those companies has occurred through collaboration between the City and businesses. However, there are also examples of the businesses expanding their operations to locations outside the City of Northfield. The EDA will take a proactive role in advocating for Northfield companies on issues that are important to their operations, and seek for solutions that encourage business expansions locally.

Northfield Economic Development Authority (EDA)

2010 Work Plan

Budget

Section 10

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Program Description & Applications

Section 11

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Comprehensive Economic Development Plan

Section 12

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JUNE 2006

PREPARED FOR THE NORTHFIELD (MN) ECONOMIC DEVELOPMENT AUTHORITY

COMPREHENSIVE ECONOMIC DEVELOPMENT PLAN

Northfield photos provided courtesy of Miriam Mueller.

Deanna Kuennen Brian Oâ&#x20AC;&#x2122;Connell

Staff Liaisons

Dixon Bond Galen Malecha

Council Representative Members

Bill Cowles Tracy Davis-Heisler Rick Estenson Mark Moors Paul Smith

Members

Northfield Economic Development Authority

The project team would like to thank the many individuals who took time to participate in the development of this document. We are particularly grateful to the Northfield EDA and the many residents, business owners, and organizations who provided feedback and valuable insights regarding the community.

ACKNOWLEDGEMENTS

comprehensive economic development plan

IMPLEMENTATION MATRIX ............. 77

TARGET INDUSTRIES ..................... 60

STRATEGIES .............................. 47

INTRODUCTION .......................... 43

OPPORTUNITY 3: TALENT ............... 43

STRATEGIES .............................. 34

INTRODUCTION .......................... 30

OPPORTUNITY 2: PLACE ................. 30

STRATEGIES .............................. 14

INTRODUCTION ............................ 9

OPPORTUNITY 1: INDUSTRY .............. 9

EXECUTIVE SUMMARY ..................... 1

CONTENTS

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Name Gary Ebling Moe Jeskey Fred Rogers Robert Bierman Pat Vincent Mayor Lee Lansing Jim Sawyer Christopher Sawyer Don Kuehnast Jim Nelson Brett Reese Dave Shumway James Gleason Edith Nelson Senator Tom Neuville William Bassett Jay Jasnoch Robert Kuyper Dick Dahl Dave McBain John Mathern Representative Ray Cox Dan Bergeson Victor Summa Joe Grundhoefer

Affiliation (in alphabetical order) Bridgewater Township Chair Cardinal Glass Carleton College Northfield Chamber of Commerce Northfield Chamber of Commerce City of Northfield College City Beverage College City Beverage Community National Bank Community National Bank Downtown Building Owner First National Bank Gleason Excavating Greenvale Township Clerk Grundhoefer, Neuville, & Ludesher Interim City Administrator Jasnoch Construction Kuyper Group Malt-O-Meal Company Malt-O-Meal Company Mendota Homes, Inc. Northfield Construction Company Northfield Downtown Development Corporation Northfield Downtown Development Corporation Northfield Downtown Development Corporation

about us

The following people were invited to participate in Context Mapping Sessions sponsored by the Northfield Economic Development Authority and facilitated by TIP Strategies in November 2005 and January 2006.

7000 North MoPac, Suite 305 Austin, Texas, 78731 512.343.9113 (voice) 512.343.9190 (fax) contact@tipstrategies.com www.tipstrategies.com

T.I.P STRATEGIES, INC.

Established in 1995, the firmâ&#x20AC;&#x2122;s areas of practice include economic development consulting, strategic planning, site selection, economic impact analysis, regional economic development, target industry analysis, cluster analysis, technology audit, transit-oriented development, workforce analysis, feasibility studies, market analysis, and redevelopment analysis and planning.

TIP Strategies, Inc. (TIP) is a privately held Austin-based business and economic development consulting firm committed to providing quality solutions for both public and private-sector clients.

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

comprehensive economic development plan

Name Lynda Grady Ken Bank Renee Huckel Devlyn Brooks Willard Estrem Jim Brown Jessica Peterson Steve Schmidt Pete Sandberg John Dudley Mark Mohlke Northfield Township Chair Rice County Board of Commissioners Rice County Board of Commissioners Schmidt Construction St. Olaf College Waterford Township Chair Wells Fargo Bank

Northfield News Northfield News

Affiliation (in alphabetical order) Northfield Enterprise Center Northfield Hospital

Contact Mapping Invitees (continued)

comprehensive economic development plan NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

iii

its size. The city boasts a number of assets and a unique character that is absent from many of America’s small towns and suburbs. An historic downtown, burgeoning riverfront, and distinctive retailers make Northfield a popular destination. Two nationally recognized liberal arts colleges, Carleton and St. Olaf, create intellectual capital that extends beyond students and faculty to a wide variety of cultural offerings for the community as a whole.

Northfield is in an enviable position for a community of

deserving of its reputation as one of America’s most appealing small cities. Preserving the city’s quality of place, however, will come at a cost. Northfield’s ability to offer a mix of employment opportunities, to maintain and enhance the downtown, and to provide the level of services that current and future residents demand will hinge on the community’s commitment to pursuing specific economic development objectives – and to doing so in a highly visible manner.

Most importantly, though, this plan is intended to sound an alarm. Northfield is an exceptional community, easily

Giuseppe Tomasi di Lampedusa (1896-1957)

If we want things to stay as they are, things will have to change.

These advantages, however, are no guarantee that growth will occur in a way that is economically viable. In recognition of this fact, the Northfield Economic Development Authority (EDA) engaged TIP Strategies, Inc. (TIP), to develop a comprehensive economic development plan for the city. The plan is a response to the leadership’s desire to make economic development a priority while balancing the community’s desire to protect its identity as a “freestanding” community and maintain its sense of place.

These attributes, in addition to a strong employment base and easy access to the Twin Cities, create conditions under which growth is highly likely. While rapid suburban development is a national pattern – resulting in communities with no real sense of identity – Northfield has defied the odds in maintaining both its own employment base and its downtown core.

EXECUTIVE SUMMARY

comprehensive economic development plan NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Re-positioning Northfield in relationship both to the Twin Cities and to its smaller neighboring communities.

These predictions have important implications for Northfield. Because of the higher property class rate assigned to nonresidential property, commercial property typically generates more income than housing (see box page 10). Businesses also generally require fewer public services, such as police and fire, often making

1. Increase the availability of business and industrial land. The availability of land for business expansion and recruitment continues to be at the forefront of community discussions. Strong residential demand and limited annexation powers have combined to drive up land costs, making even available property unattractive for non-residential development. Without specific commitments to offer suitable land for industrial and technology-related expansion, it is reasonable to expect that future growth will be dominated by housing.

TIP, with the strong encouragement of the city’s leadership, has sought to address the question of Northfield’s future economic vitality in a clear-headed way. Based on our understanding of the city’s opportunities and challenges (see box), we believe that the following strategies represent the highest priorities for Northfield.

Priority Strategies

Active promotion of economic development by increasing the availability of commercial land, aggressive business recruitment, and talent attraction.

In broad terms, the objectives are:

EXECUTIVE SUMMARY

comprehensive economic development plan

- Low rates of retention of graduates

resources

- Lack of industrial space and land

WEAKNESSES

- Growing healthcare sector

Colleges

- Highly educated workforce - Authentic downtown - Presence of St Olaf and Carleton

STRENGTHS

- “Suburbanization” of Northfield - Loss of independent retail downtown

THREATS

- Expansion of existing businesses

Minneapolis-St. Paul

- Riverfront development - Medical and related industries - Business expansion out of

OPPORTUNITIES

The following table highlights Northfield’s strengths, weaknesses, opportunities, and threats, commonly referred to as a SWOT analysis. Broadly speaking, economic development strategies emerge directly from the SWOT analysis. Weaknesses – even if not directly related to economic development – must be addressed, and strengths must be supported and reinforced. Similarly, threats to the economic well-being of the community must be anticipated and responded to before they become crises. Opportunities, on the other hand, should be acted upon aggressively and, if possible, collaboratively.

quantitative analysis, our work was informed by interviews with local businesses and community leaders, as well as with developers and others in the Twin Cities region. The findings from this phase, refined based on input from stakeholder meetings held in November 2005 and January 2006, provided the foundation for this plan.

TIP took an asset-based approach to this work, focusing on strategies designed to maximize Northfield’s existing advantages. We began by conducting an economic assessment of the community, (published under separate cover). In addition to this

our approach: COMMUNITY ASSESSMENT

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

However, in addition to its historic character, downtown Northfield has an asset that many communities do not — the Cannon River. Once pivotal to the city’s existence, the river has

2. Leverage the Cannon River. Few would disagree that downtown is an essential part of Northfield’s sense of place. And it is widely recognized that the health of downtown retail is a key indicator of the health of downtown. On this point, Northfield’s story is no different than that of many other communities. Independent retailers, most of whom are working with the thinnest of profit margins, are often unable to absorb rising costs or to offset even a small amount of competition from national chain stores. Faced with dramatic increases in property taxes and competition from larger retailers locating on Highway 3, the future of Northfield’s independent retailers is precarious.

If this situation is to be resolved, given the competitive environment, public sector involvement will need to be a factor. For this reason, increasing the availability of commercial land should be the EDA’s highest priority. TIP recommends that the EDA explore alternatives for public participation in the development of a commercial/industrial center. Priority should be given to property surrounding the Northfield Hospital site and land to the west of the existing industrial area (see map). Because of current market considerations and the potential for negative impacts we recommend a site of no more than 120 acres. Accommodating the expansion needs of existing business should be the initial focus. Subsequent marketing of properties should be targeted to the industry sectors outlined in this plan.

In addition to the direct fiscal implications, uncontrolled residential growth can create a number of unintended consequences. These include increasing commute times (because residences and businesses are further apart) and demographic shifts (as developers cater to specific markets, such as senior housing or upper income markets), as well as the impact of market forces themselves. Strong residential demand creates dramatic rises in housing costs and speculation, while weakening demand can leave the city with vacant units, falling home values, and deteriorating neighborhoods.

them a net gain to the city’s tax base. Commercial development also has a “multiplier effect” as spending generated by companies and their workers circulates through the local economy.

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comprehensive economic development plan

Riverview Industrial Park

Northfield Hospital

Priority Business & Industrial Areas

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Q-Block Area

Riverfront Redevelopment Site

Cannon River Opportunity Area

3. Re-capture alumni. The colleges provide a steady stream of talent to the community. Collectively, they enroll nearly 5,000 students who rank among the nation’s best and brightest. Yet it is clear that the community has not been entirely successful in realizing the benefits of their presence. Given their institutional missions as four-year liberal arts

Development plans for this area (see map) have tremendous potential. The EDA should work with the Northfield Downtown Development Corporation, the Northfield Chamber of Commerce, and others to strengthen the retail environment, increase the range of professional services, and provide a range of housing options. The expansion and revitalization of the entire riverfront can accomplish many of these objectives.

Recent development proposals, including the Q-Block development initiative and the Riverfront Redevelopment project, can set the tone for additional redevelopment and infill projects along the river. Emphasis should be placed on orienting new development to the river. By this we mean ensuring that buildings have access to the river as well as to the street, creating additional pedestrian areas along the riverfront, requiring common architectural elements and adequate lighting, and encouraging uses that relate to the riverfront. These uses could include sporting goods stores (with equipment rental options), cafés, and offices with river views.

faded in importance from an economic development standpoint. Despite recent developments, linkage to the downtown is still unfocused. Activating the entire riverfront — by orienting development to it and encouraging uses that maximize a riverfront location — can help invigorate the downtown and integrate it with other areas of the city.

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comprehensive economic development plan

students Continue to engage leadership of colleges in economic development Increase range of housing options Create entrepreneurial and innovative start-up opportunities Take steps to integrate city’s growing Hispanic/Latino population

` Increase connection with current and former

Opportunity 3: Attracting and retaining talent

neighbors

` Re-define Northfield’s relationship to its

` Develop coordinated retail strategy

` Maintain and enhance the existing downtown

of place

Opportunity 2: Maintaining Northfield’s quality

strategy ` Raise awareness of Northfield in the region ` Explore options for leveraging existing fiber network

` Implement a targeted industry recruitment

` Concentrate on the needs of existing business

` Make land available for business expansion

Opportunity 1: Diversifying the economic base

strategies at a glance

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Perhaps the greatest challenge to successful economic development is organizational structure. Too often, efforts are hampered by the existence of numerous organizations with overlapping and poorly defined missions – none of which may have adequate funding to carry out their duties. Alternatively, the lead organization may be understaffed, under-funded, or uncertain of its mission. Failure to address these concerns will dramatically decrease the EDA’s ability to conduct an effective retention and recruitment effort.

Organizational issues arise in virtually any planning effort, particularly with a subject as farreaching as economic development. This plan is no exception. Its purpose is to provide the city and the EDA with specific guidance regarding the commitment of resources for enhancing Northfield’s economic vitality. However, some issues raised in the plan affect other organizations and will require a coordinated approach. These issues are raised here —even though they may be outside the direct purview of the EDA — because we view them as central to the city’s economic future.

Organizational Considerations

The growing relationship of higher education to economic development and the opportunity presented by the graduates of St. Olaf and Carleton make the attraction and retention of alumni the most promising strategy for developing Northfield’s talent base. The fact that Northfield can be considered a potential residence for a large pool of talented individuals should work to the community’s advantage throughout the Midwest. The EDA should work with the colleges and others to reconnect with alumni — those that have completed their graduate studies and may be looking to start a family or a business venture. This would include compiling alumni databases, conducting e-mail surveys, and developing promotional materials to keep the “Northfield brand” fresh in the minds of former students.

campuses, Northfield has not realized additional public and private investment. The research and development or startup enterprises often associated with university-related economic development are not readily apparent. In addition, a lack of graduate programs and the lure of metropolitan areas, including the Twin Cities, means that students typically leave the area upon graduation.

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comprehensive economic development plan

technologies. Products and

services. Includes a

produce, transmit, or process data. Examples include publishing, software, broadcasting.

` Information technology. Includes firms that

variety of occupations: attorneys, accountants, marketing and advertising, architects and engineers, testing and R&D.

` Professional/technical

this target range from direct patient care to diagnostic services to medical research.

` Healthcare/medical. Activities covered under

processes which are environmentally beneficial or benign. Includes industries such as renewable energy, sustainable building products, pollution control equipment, waste management, and remediation services.

` Environmental

capacity for manufacturing and paying above average wages for technical skills. Markets are specialized and emphasis is on design over production.

` Specialty manufacturing. Firms requiring IT

producer to consumer in the most efficient manner. More sophisticated than warehousing and trucking activities of the past.

` Logistics. Firms involved in moving goods from

The following industries were identified as having the highest potential for success in Northfield. Additional information regarding each industry is provided on pages 60 to 77.

target industry list

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

` state and federal

` foundations

` regional initiative (cooperative agreements)

` private funding (corporations)

` additional funding from the city

Funding > Current funding for the EDA is insufficient to catalyze the plan. Wholly dependent on the city, the EDA finds itself in a difficult position if it wants to expand its capacity. The options for doing so are limited:

With the exception of workforce and training, the EDA is authorized to conduct all of the traditional activities associated with economic development (see box). As a result, there is no recommendation to increase the functions of the EDA.

Authority > The Northfield EDA was created by the city council in September 1990 under Chapter 469 of the Minnesota Statutes. The EDA is charged with carrying out economic and industrial development and redevelopment within the city. It is governed by a sevenmember board consisting of two council members and five council-approved members. The broad range of powers is detailed in 469.101.

4. The capacity, including staffing and other resources, to execute a plan.

3. The organization’s relationship to other entities in the community.

2. The funding that allows the organizations to carry out that authority.

1. The authority by which they conduct economic development.

In this admittedly sensitive area, TIP recommends a reconsideration of EDA staffing and the commitment of greater resources by which to implement this plan. In arriving at this recommendation we have considered the ways in which economic development organizations should be assessed:

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comprehensive economic development plan

` business start-up support √√

` workforce and professional training

` infrastructure improvements

` bonding authority

` land and buildings

` real estate disposition and improvements √√√

` financial incentives

industries) √

` business expansion and retention (targeted

` business advocacy

industries) √√

` marketing and recruitment (targeted

Economic development organizations are expected to perform some, or all, of the functions listed below. Checkmarks (√) indicate areas of special emphasis. They are based on the orientation of this plan and are, in varying degrees, essential if action is to be taken.

economic development functions

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

The real estate and infrastructure needs of land development require additional support. While the means to accomplish this does not have to result in additional staff, resources must be committed. To this end, a real estate task force should be formed. The task force should consist of the EDA director, two EDA board members (including the chair of the EDA Land Committee), representation from St. Olaf, one private developer, and one financial consultant.

The expansion and recruitment of target industries â&#x20AC;&#x201C; along with the acquisition of land â&#x20AC;&#x201C; should be seen as the top priority for the EDA. To ensure that expanding businesses consider Northfield, a dedicated staff is required. TIP recommends two staff, one to act as managing director with responsibility for management and recruiting strategy. This position should be supported by a marketing and administrative support person.

Capacity > The current lack of true staffing for the EDA makes it difficult to address the many strategies identified in this plan. Although clearly qualified to support the EDA, the current staff has divided functions (on behalf of the city). The additional responsibilities called for will invariably create tensions. While some relief could be gained by the outsourcing of activities (as suggested in the task force listed below and elsewhere in the plan), this creates additional burdens on the board itself or the city.

While it is not within the purview of this plan to address these organizations directly, we recommend that the relationship of the NEC and the EDA be clarified. In order to sharpen the focus of economic development in Northfield, we recommend 1) creating formal inter-linking board memberships with the NEC and 2) engaging in joint promotion where feasible.

Relationship > A key consideration is clarity of mission across all organizations. This is what marks the strongest economic development efforts. In addition to the Northfield EDA, there are a number of groups with some relationship to economic development (see box).

A capital campaign can, of course, include all of the above options. Regardless of the funding options pursued, implementation of the plan will require a significant investment by the community over an extended period of time.

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comprehensive economic development plan

Authority

` Northfield Housing and Redevelopment

` Northfield Convention & Visitors Bureau

` Northfield Enterprise Center (NEC)

(NDDC)

` Northfield Downtown Development Corporation

` Northfield Chamber of Commerce

In addition to the Northfield EDA, the following organizations have some economic developmentrelated responsibilities:

the many faces of northfield

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

A final point must be made about the plan’s orientation. It will become apparent that the same, or similar, ideas appear in different strategies. This is intentional. The issues facing communities today do not fit neatly into boxes and there are overlapping concerns. The willingness to address the Northfield’s future in a holistic manner will go far in determining success.

The strategies outlined in this plan are designed to build on the city’s existing assets, while recognizing that change is an inevitable part of growth. We recognize that the growth that Northfield will experience should be both manageable and sustainable. What is called for is a plan that is candid in its assessment of risks and ambitious in its goals. We have tried to meet that challenge.

Our work is also shaped by our understanding of trends affecting the practice of economic development across the U.S. As a result, we have framed the discussion in terms of the factors that we believe have the greatest impact on Northfield’s economic vitality: diversifying the economic base, maintaining a sense of place, and attracting and retaining talented workers. These challenges are not unique to Northfield: they are the concern of literally every community in the country. The response, however, must be tailored to Northfield’s specific circumstance.

Several factors have shaped this plan. First and foremost is our definition of economic development. While most definitions focus on indicators, such as jobs or wealth creation, we have distilled the practice to its essential goal: economic development is the application of public resources to stimulate private investment. With this in mind, the role of the public sector gains a clarity that other definitions obscure. Public officials and local government employees do not create jobs or generate wealth. But they do control significant resources. Directing these resources effectively and efficiently is their paramount duty. Effective programs should be judged by how well public resources can create a response from private investors.

Conclusion

In summary, it is our view that the EDA must be strengthened. Specifically: the EDA should exercise its authority to own land; it should hire dedicated staff to work with city staff; and it should actively raise funds in addition to those provided by the city.

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comprehensive economic development plan

Comprehensive Plan, Northfield, Minnesota December 2001, pages 3-1to 3-2

The community is committed to preserving and enhancing the quality of its neighborhoods, the quality of education, the diversity of employment opportunities, and a diversity of arts, cultural and recreational pursuits. Northfield is dedicated to maintaining downtown as the focal point of the community, maintaining a prosperous economic base, protecting its extensive natural environment, and promoting public participation in civic, social and cultural endeavors.

The vision of the City of Northfield is to preserve and enhance the city’s unique “small town” heritage, preserve its historic and environmental character, and provide a high quality of life through a sustainable development pattern. Northfield will engage in collaborative planning with other political jurisdictions and participate within the broader global community.

Our work was informed by the vision and guiding principles laid out in the city’s comprehensive plan.

Linking to VISION

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Without specific commitments to offer land suitable for commercial and technology-related expansion, it is reasonable to expect that future growth will be dominated by housing. And continuing pressure for major residential development will almost certainly continue to drive up land costs, making non-residential development less attractive. These predictions have important implications for Northfield. Residential property taxes form an increasing proportion of the city’s overall revenue. Housing developments themselves take up considerable land – land that is already restricted by annexation agreements.

In addition to global pressures, site constraints in Northfield make it increasingly difficult for local businesses to expand. The lack of readily developable industrial land — the result of housing development and annexation limitations — threatens the area’s ability to maintain and expand its existing base. Affordable land for business expansion was a recurring theme throughout the planning process. In the absence of favorable sites, expanding local businesses (as well as companies who might relocate to Northfield), have begun looking to surrounding communities. Dundas, Lakeville, and Faribault have benefited as a result of their lower land and housing costs, larger variety of readily available sites, and their greater availability of services.

Major employers such as Malt-O-Meal, Cardinal Glass, Sheldahl/Multek, and McLane provide a strong foundation for the local economy and offer employment opportunities for skilled and unskilled workers in the area. While several of these firms have expanded in recent years, Northfield’s businesses are subject to the same pressures as manufacturers across the U.S. This is evidenced by the estimated net loss of over 200 manufacturing jobs in Northfield from 2000 to 2004.

and expanding the local industrial base is the most significant opportunity open to Northfield. With strengths in manufacturing, education, and health services, the city’s employment base is already more diversified than many other non-metropolitan communities. These three sectors, which account for nearly two-thirds of all employment in Northfield, provide a degree of security that is rare in similar sized communities.

Diversifying

OPPORTUNITY 1: DIVERSIFYING THE ECONOMIC BASE

comprehensive economic development plan:

Understanding the role of innovation, the opportunities for expansion of existing companies, and the best targets for recruitment is an important building block of the plan.

For this reason, our understanding of industry considers the full complement of economic activities—ranging from traditional industrial employers to advanced research to entrepreneurship —as well as the physical infrastructure (industrial parks, sites, transportation etc.) and business climate to support those activities.

The U.S. manufacturing industry continues a transformation that has profound effects on the practice of economic development. It is forcing us to rethink what we mean by a primary job, how we measure economic impact, and how we design incentives. This is due, in large part, because manufacturing employment continues to decline. It is no overstatement to say that you cannot build an economic strategy around manufacturing jobs.

Redefining INDUSTRY

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

A solid commercial and industrial base provides the foundation for accomplishing many of these objectives. In the simplest terms, non-residential property is an important source of revenue. Under Minnesota’s property tax system, industrial property is assigned to a higher property class rate than residential (see box). As a result, commercial property has a higher tax capacity and generates more tax revenue than residential property of equal value. National

economic base,

` maintaining downtown as the focal point of the community and maintaining a prosperous

diversity of employment opportunities, and a diversity of arts, cultural and recreational pursuits

` preserving and enhancing the quality of its neighborhoods, the quality of education, the

environmental character, and providing a high quality of life through a sustainable development pattern.

` preserving and enhancing the city’s unique “small town” heritage, preserving its historic and

clear vision for Northfield’s future growth. It includes the following principles:

Why does commercial and industrial growth matter? The city’s comprehensive plan outlines a

maintain its position as a “freestanding” community, Northfield must retain and attract companies. In order to retain and attract companies, there must be places to put them. The market’s current preference for housing threatens to absorb much of the local land supply and drive per-acre costs on the remaining sites beyond what is feasible for non-residential development. Without a concerted effort to secure industrial land, Northfield may not be able to compete for corporate expansions and relocations in the future.

The rationale behind this view is straightforward. In order to secure its economic future and

Developers in the Twin Cities reinforced the view that land costs make housing a more feasible financial investment, driven by higher demand and by the remaining supply of industrial/ commercial properties in the metropolitan area. And while this does reflect current market conditions in the region, it does not suggest that Northfield should compromise on its economic development goals. Merely acceding to the real estate market is not in the community’s long term interest. Therefore, an economic diversification strategy must include the preservation of industrial land.

OPPORTUNITY 1: DIVERSIFYING THE ECONOMIC BASE

comprehensive economic development plan:

class rate

parcel tax capacity

Market Value Property Class Rate Tax Capacity City Taxes

2% 8,000 $3,160

1% 4,000 $1,629

Sources: League of Minnesota Cities; City of Northfield Finance Department

$400,000

Industrial

Homestead Residential $400,000

The following example illustrates the impact of property class rate on City of Northfield tax revenues for two hypothetical properties the using 2005 tax rates. Although the market value of the two properties is the same, the industrial property has a higher tax capacity and, therefore, generates more tax revenue for the city than a residential homestead.

parcel market value

Under the Minnesota property tax system, property class rates are set by the state legislature for various uses. These rates are then used to determine tax capacity, which is defined as the market value of a given taxable parcel multiplied by its property class rate:

example: THE VALUE OF INDUSTRIAL LAND

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Finally, balanced growth matters to Northfield for reasons apart from direct financial implications. If future residential growth is not pursued in a sustainable fashion, the city stands to lose many of the attributes that make it desirable in the first place. If Northfield’s remaining property is allowed to develop based purely on market demand, the city may experience unintended consequences. These include increasing commute times (because residences and businesses are further apart) and demographic shifts (as developers cater to specific markets, such as senior housing or upper income markets). In addition, the cyclical nature of residential markets poses its own threat. Increased demand in a given market can lead to soaring home prices, decreasing diversity, and speculative development. A downturn in home values or a

Along with the multiplier question, there is also value in understanding the implications of continued residential growth. Northfield is still far from becoming a “bedroom community” to the Twin Cities. Like any investment proposition, however, diversification is a key consideration. If population growth is not balanced with commercial and industrial growth, the city becomes more vulnerable. Overdependence on residential property tax often forces communities to choose between reducing services or finding alternative sources. This occurs as pressures from homeowners mount. Property taxes currently comprise approximately one-third of the city’s general revenue, a figure in-line with state averages. But an analysis of taxable capacity (see Appendix A of this document) reveals that Northfield is currently more reliant on residential property taxes than other similarly situated communities.

But the importance of commercial development goes beyond its direct fiscal impact. Jobs require people to fill them. Some of these people will chose to live in the community, generating property tax and purchasing products that support local businesses. Workers who live outside the community may spend money at local retail establishments or use local service providers, contributing to the vitality of the local business community. To meet the increased demand, local businesses increase spending and hiring, which in turn leads to more spending from employed households. This pattern generates opportunity and wealth. By some estimates, a single manufacturing job creates as many as 2.5 additional jobs in the community. This “multiplier effect” is one reason that commercial and industrial development typically returns more to the economy than residential alone.

studies, such as those conducted by the American Farmland Trust (see box) suggest that nonresidential property also places fewer demands on public services.

OPPORTUNITY 1: DIVERSIFYING THE ECONOMIC BASE

comprehensive economic development plan:

COCS studies have been criticized because of the oversimplification inherent in the methodology. Criticisms include: 1) a failure to consider the role of capacity and alternative methods of service delivery for public infrastructure, 2) lack of method for accounting for the intensity of use, and 3) the use of gross land categories, such as “residential” which masks important distinctions, like mobile homes or apartments. The studies do, however, provide a tool for thinking about the relationship between land use and fiscal impact.

Studies conducted throughout the country suggest that commercial property returns far more to a city’s revenue stream than it requires in services. For example, the American Farmland Trust has summarized cost of community services (COCS) studies conducted in 70 cities across the country. According to their findings, published in April 2000, commercial and industrial land requires only 29¢ in services for each $1.00 of taxes paid. By comparison, residential land is a net drain, requiring $1.15 in services for each $1.00 of tax collected.

American Farmland Trust

“It costs local governments more to provide services to homeowners than residential landowners pay in property taxes.”

cost of community services

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

In light of the opportunities presented by the colleges and the increasingly regional approach of Northfield Hospital, we recommend that the city focus on development of property surrounding the hospital (see map). This effort should go beyond the creation of a traditional industrial center. By this we mean that the city should encourage the development of a mixed use project that could meet the expansion needs of local business, as well as providing a catalyst for other concerns, such as including professional services growth and increasing the options for housing.

As a result, this plan recommends increasing the availability of land for business and industry. This should be the highest priority for the EDA. Accommodating the expansion needs of existing business should be the initial focus. Subsequent marketing of industrial properties should be targeted to the industry sectors outlined on pages 60 to 77 of this document. These targets emphasize increasing the level of technical and professional employment in the community. Accommodating these targets and the workforce they require is at the heart of this plan.

The simple reality of urban growth into outlying communities requires a willingness to rethink Northfieldâ&#x20AC;&#x2122;s overall position. The question of residential development does not represent an either/or choice for the city. Accommodating population growth is an essential element of successful economic development. The choice is what type of development requires public intervention. Clearly, residential development in Northfield requires no economic stimulus under current conditions. This is not the case with industrial land.

Increased residential development may be viewed as encroaching on industrially zoned land, but may have its own negative consequences. These include increased traffic congestion as Northfieldâ&#x20AC;&#x2122;s workforce moves further and further from the city; loss of major employers as they relocate to be closer to their workforce; fewer retail opportunities due to stagnant population growth. The issue is compounded by the fact that restriction of new housing developments in Northfield may only serve to force growth into adjoining cities, meaning that Northfield receives many of the negative impacts without benefit of the accompanying tax revenues.

movement away from one product (such as senior housing) in favor of another could leave the community struggling with vacant units and deteriorating neighborhoods.

OPPORTUNITY 1: DIVERSIFYING THE ECONOMIC BASE

comprehensive economic development plan:

Riverview Industrial Park

Northfield Hospital

Priority Business & Industrial Areas

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

The following strategies serve as guidance in the continued diversification of the city’s economic base.

Because of the city’s interest in preserving its character and the competitive environment in the region (see box, page 14), we recommend that a site of not more than 120 acres be considered. Large-scale developments, such as the mixed use project planned along I–35 in Rice County, would not be in Northfield’s interest for a number of reasons. First, a project of this size would likely fall largely outside the city limits (due to land constraints). In such a case, Northfield would realize little of the direct fiscal benefit, but would still experience negative impacts associated with major developments. These impacts include traffic congestion, as well as increased pressure on the local labor force and housing supply.

Along with the hospital-area site, the city should also take steps to preserve the land to the west of the city’s existing industrial area. This area, which lies just northeast of the site identified as “Site B” in the 1997 Industrial Land Physical Site Analysis, is designated residential under the city’s current comprehensive plan. Given the importance of preserving industrial land to Northfield’s future, we recommend this area be re-zoned for industrial/mixed use development.

OPPORTUNITY 1: DIVERSIFYING THE ECONOMIC BASE

comprehensive economic development plan:

3rd Edition, Urban Land Institute, p. 552

Real Estate Development: Principles and Process,

A development, in one building or several buildings, that combines at least three significant revenue-producing uses that are physically and functionally integrated and developed in conformance with a coherent plan.

definition: MIXED USE DEVELOPMENT

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Strategy 1A:

•

transportation-related improvements. The city has recently completed a study of alternatives for extending infrastructure to the areas adjacent to the hospital. This information should be incorporated in the planning process.

Infrastructure. Determine the status of infrastructure and

and zoned to allow a mix of uses, including light industrial, office, residential, and retail. The property west of the existing industrial area is currently designated as residential in the city’s comprehensive plan. Action should be taken to reclassify this property as soon as possible.

Land use classification. Ensure that properties are annexed

parcels, ownership, and current asking price (for those properties being offered for sale).

Purchase price. Assemble/update information on number of

1A.1: Update information on preferred development sites. The area adjacent to Northfield Hospital was studied as part of the city’s Industrial Land Physical Site Analysis. However, conditions have changed since the study was published in May 1997. Updating information on the two priority sites is the first step in this strategy.

Actions:

Make land available for business expansion. The EDA should focus its efforts within this challenge on assembling land for a commercial/industrial center. Priority should be given to 1) the property surrounding Northfield Hospital, including lands owned by St. Olaf, and 2) the area west of the existing industrial area (see map, page 12). The focus of this work should be on development of a mixed-use, “blue ribbon” project that can help diversify the city’s economic base while advancing Northfield’s image in the region.

OPPORTUNITY 1: DIVERSIFYING THE ECONOMIC BASE

comprehensive economic development plan:

These caveats do not mean Northfield should not consider an industrial development. Rather, they present the case for developing a product that is targeted to a specific opportunity (such as health sciences) or that is not currently available in the market.

rezone a major mixed use commercial/industrial complex on Interstate 35 paints an entirely new picture for the area. Any Northfield project must be undertaken with a complete understanding of the nature of this development and its target market to avoid competing head-to-head.

• Planned projects. Rice County’s plans to

in communities like Farmington, Cambridge, Monticello are just a few of those that would compete with Northfield. Cheaper land (as little as $1/SF for “qualified businesses” is being touted by Monticello) may provide these developments with a cost advantage.

• Existing projects. City-owned industrial property

Twin Cities have experienced significant declines in manufacturing in recent years. While the outlook is improving, the region’s more than 19 million square feet of vacant industrial space (Grubb & Ellis 3Q2005) suggest that a significant number of industrial jobs could be accommodated in the metropolitan area before Twin Cities firms would need to look elsewhere.

• Minneapolis/St. Paul. Like much of the US, the

the competitive environment

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

The city has recently gained the ability to shift this important incentive to other sites within the city. As part of this task, the EDA should consider whether these sites are eligible for JOBZ designation.

designated under the state’s JOBZ program. This tool offers state and local tax exemptions to qualified companies through 2015. Under the city’s Business Subsidy Policy, to be eligible for JOBZ incentives, qualified companies must create and retain a specific number of jobs that pay a “living wage” (defined as 100% of the median wage paid within the applicable industry category) and offer benefits, including health insurance. The number of jobs to be created or retained is 5 jobs for businesses relocating within Northfield and 10 for those moving into the city from outside

JOBZ designation. Northfield currently has 26 acres

City ownership. In general terms, city ownership of the chosen property would improve the city’s ability to attract a developer and provide significant flexibility in negotiating terms. If it is decided that the public sector should take an active role in developing specific properties, a long-term horizon for development is necessary. This typically occurs using one of two approaches (see box): a master developer strategy or some form of public-private partnership.

Private ownership. In this scenario, the city serves primarily as a facilitator. For example, a developer agrees to make an investment in a property in return for city-financed improvements.

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1A.2: Determine level of city involvement. There are several different development options available requiring varying levels of public sector involvement. These can be broadly outlined along two paths based on ownership of the land:

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OPPORTUNITY 1: DIVERSIFYING THE ECONOMIC BASE

comprehensive economic development plan:

Formation of a public/private partnership is another option. In this case, the city serves as both a participant and a facilitator. The city could choose to develop a portion of a development on its own or could confer the rights to a property in exchange for certain improvements. This is similar to the approach employed by the city in “The Crossings” project.

Under a master developer scenario, the city serves as a primary participant. The city acquires land, and then leases or sells land to a private developer and allows that party to develop the land according to pre-approved guidelines. In return, the developer is allowed to realize the long-term revenue streams. Under this approach, Northfield would purchase the property, then set forth specific standards for the development and invite developers (through a competitive bidding procedure) to meet those standards. The community (including existing companies) could then serve an advisory role to the city and developer. Additional funding (state or federal) could be sought if the development were designed to include research-related facilities.

approaches to city ownership

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Request for proposal (RFP). Issue a formal RFP to local and

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regional developers for a site plan for one of the preferred development sites. We recommend that the RFP be focused on the hospital-area site. The RFP should ask developers to provide a detailed concept plan that accommodates both industrial expansion and mixed use projects.

Developer’s forum. Hosting a developers’ forum to discuss relevant issues regarding the design, construction, or positioning of the project can provide guidance in the planning process. The event could be organized using a round-table format, with developers leading the discussion, or a charrette approach (see box), which emphasizes public input in the design of a specific project. The charrette process was used to develop Northfield’s Westside Design Guidelines, which identified gateways along Highway 3 and provided initial guidelines for the Riverfront Redevelopment project.

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1A.3: Engage development community. Engaging the development community early in the process can help ensure that the project incorporates the most current thinking. TIP recommends the EDA consider pursuing one or both of the following:

one or both of the priority sites. Gaining ownership can be accomplished through various means, ranging from direct purchase to land transfer to lease arrangements. TIP further recommends the formation of a public-private partnership with a master developer.

Recommendation: TIP recommends that the EDA gain ownership of

While the level of cooperation varies dramatically, this approach is most successful when the city has a clear vision of how it wants the property to develop and uses public improvements to guide private investment. This can be accomplished by zoning and codes, by design standards, and by the scale and location of physical improvements – from roads to water and sewer.

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comprehensive economic development plan:

Wikipedia entry

However, charettes tend to be small groups and the resident representatives may not represent all the residents nor have the moral authority to represent them. Residents do get early input into the planning process. For developers and municipal officials charrettes achieve community involvement and hopefully avoid costly legal battles.

A charrette (often spelled charette and often called design charrette) is an urban planning technique for consulting with all stakeholders. Charrettes are typically intense, possibly multiday meetings involving municipal officials, developers and local residents. A charrette promotes joint ownership of the solution and attempts to defuse traditional confrontation between residents and developers.

definition: CHARRETTE

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Funding. The full array of financing tools should be brought to bear

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Market. A market-driven approach that considers the competitive environment and helps determine the appropriate mix of uses at the time of construction.

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project, including an analysis of traffic impacts associated with the project, provisions for buffering of uses, as well as the protection of any natural areas. The plan should consider how these natural elements can be integrated into the development to create a “green” feel and provide an amenity for tenants. Northfield has demonstrated leadership in the area of environmentally sensitive industrial development which should be brought to bear on this project.

Impacts. Performance standards should be developed for the

relationship to the rest of the city. Development plans must be coordinated with other relevant plans, including the downtown, campus master plans, and the city’s comprehensive plan.

Linkages. Consideration should be given to understanding the project’s

on this project. This includes the creation of a tax-increment financing district to bond issues to general fund appropriations. Additional details on options must be linked to specific projects.

Barriers. Identification of barriers to development and, where possible, actions for alleviating them prior to marketing the property.

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1A.4: Develop area plan. Once a concept is established for the development, the city should prepare and implement a specific plan for the area to guide development of the project. The planning process should include a broad range of stakeholders, including the leadership of the colleges, other economic development organizations, and local employers, including those who may be prospective tenants of the development. The following elements should be considered in the plan:

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comprehensive economic development plan: NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

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Second-tier opportunities. A high-end commercial and industrial center could encourage support facilities of existing businesses, such as R&D or training facilities that are currently utilized outside the city, to relocate to Northfield. With the proper positioning and amenities, corporate headquarters for small to medium-sized enterprises could also find the center attractive.

that could meet the expansion needs of existing businesses. The first tier of this effort would concentrate on accommodating suppliers or expanded operations of existing businesses. By helping to retain employers, the commercial/industrial center can send a message that Northfield is committed to accommodating existing businesses (versus the message sent by the relocation of the business to another community).

Existing business. Emphasis should be placed on creating a space

Furthermore, by positioning Northfield as a development-friendly community, this project could spur additional activity in other parts of the city, including the downtown.

flex space can position the project to compete with other sites in the region. The inclusion of uses that generate income quickly, such as housing or retail, can help cover “carrying costs” in the short-term, making the project more feasible from a financing standpoint (see box at right).

Mixed use. The creation of a mixed-use development, one that includes workforce housing (see box, page 51), retail, office, and

1A.5: Position property as “blue ribbon” project. The resulting project should be viewed not simply in terms of its ability to generate employment and tax revenues, but also as a project that can showcase Northfield throughout the region and serve as a catalyst for additional development. This can be accomplished through the following tasks:

OPPORTUNITY 1: DIVERSIFYING THE ECONOMIC BASE

comprehensive economic development plan:

Without an income-producing development option (typically housing or retail), the costs associated with a long-term build-out scenario can be prohibitively high.

Since all properties have a variety of expenses associated with them (from tax payments to debt service to maintenance costs), this is a critically important issue for real estate developers.

Also known as “holding costs,” carrying costs are the total expenses associated with property ownership. The term is generally used during that period when the property is not producing income.

definition: CARRYING COSTS

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Strategy 1B:

Opportunity. In addition to a focus on existing employers, the development should build on other opportunities in the community. For example, linkages with the colleges, the hospital, and other regional initiatives could provide a basis for positioning the project.

positioned as more than another industrial park. The Tustin Legacy mentioned above accomplishes this through its mixed-use approach, its excellent website, and its vision of a master planned property.

Promotion. Promote the site creatively. The development should be

the expansion and recruitment targets outlined in this plan, the city and/or the master developer should prepare a strategy for marketing the selected site. The city should consider the preparation of marketing materials, including a brochure and website or webpage on the city’s existing site, specifically for the proposed development. Although it is much larger in scale (700 acres), the website created by the City of Tustin, California for the Tustin Legacy redevelopment is a good example of how this approach could be implemented. (http://www.tustinlegacy.com/).

Strategy. Based on the recommendations of the specific plan and

Concentrate on the needs of existing businesses. In the context of the private sector, a business retention program is like the adage that says you must attend to your existing customers first. If you don’t do that, you

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1A.6: Develop marketing and recruitment strategy. While recruitment of new business is a viable option, the city should focus on the site as a means to encourage the expansion of existing businesses. The commercial/industrial center should be viewed as a way to create a “move-up” opportunity for existing employers and their supplier network. Once the needs of existing business have been met, marketing efforts should focus on companies in the industries outlined in Strategy 1C below.

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comprehensive economic development plan: NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

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Survey. A BRE program has two objectives: to determine which

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Visitation. The EDA’s proposed BRE program has a target of 6 business visits per year. Pulling in additional resources for these

companies are at risk of leaving the community (for whatever reason) and those that are expanding. Being able to identify those targets quickly and accurately requires some form of survey. This is different from visitations, which may (or may not) gather that information. TIP recommends an annual employer survey addressing those two questions specifically. The survey could be conducted as a paper survey or via the Internet. The “Valuing our Corporate Neighbors” on-site visitation form currently used by the city provides a starting point for this effort. However, consideration should be given to shortening the survey or dividing it into a series of shorter surveys to facilitate participation.

Inventory. Maintain inventory of existing businesses and available properties. Publicly available business records, such as tax records, utility hookups, and ownership transfers, can be good sources for information.

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1B.1: Enhance business retention and expansion (BRE) program. Having a clear understanding of the businesses already in the community, in addition to keeping tabs on new locations, is critical to on-going economic development efforts. Creating formal mechanisms for gathering information on a company-by-company basis is recommended, where possible.

Actions:

jeopardize your base. Focusing on existing business should be the heart of any economic development program. The EDA should continue to be an active partner in this task and should work closely with the Northfield Chamber of Commerce to ensure that efforts are complementary.

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comprehensive economic development plan:

Given the fiercely competitive environment for business attraction and the myriad of issues facing most communities with regard to the recruitment of new business, business retention should be a baseline activity for economic development organizations. In other words, all other initiatives, including business recruitment, should be considered in light of their ability to complement and support the existing business network.

The expansion and retention of existing businesses should be at the heart of any economic development strategy. Existing businesses form the backbone of a thriving economy. They typically represent the best opportunity for increasing the employment and tax base of a community and the greatest economic threat if they close or relocate. But local firms are often overlooked in a community's enthusiasm to recruit new, headline-generating businesses.

a bird in the hand

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Benchmarking. Benchmarking can provide an important source of

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strategy for dealing with potential layoffs or plant closures. Under the Federal Worker Adjustment and Retraining Notification Act (WARN) of 1989, companies with 100 or more employees must notify local governments and state workforce organizations about plant closings or mass layoffs at least 60 days in advance of the event. However, at this point, it is frequently too late to do anything. While Northfield has few 100+ employers, the city’s BRE program would still benefit from identifying “at-risk” companies and developing an aggressive intervention strategy.

Intervention. Northfield should develop a “rapid response”

information for economic development programs, particularly with regard to the identification of strategies for business retention and recruitment. Communities or regions with similar economic conditions should be selected. If possible, local leaders should schedule at least three visits to benchmark communities annually.

Forum. Provide opportunities for local businesses to meet regularly with economic and community development staff. The purpose of these meetings is similar to that of the employer survey, but the face-to-face approach often stimulates discussion that a survey cannot. This could be accomplished by holding quarterly forums or in conjunction with an existing event, such as is typically offered by local chambers of commerce.

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visits, such as EDA members, chamber officials (under the Grow Minnesota effort), and Ambassadors, could allow this target to be greatly expanded. The post-visit procedures outlined in the BRE workplan (dated June 6, 2005) are an important part of the process. Visitations should, however, serve a specific purpose. That purpose must link to the needs of the company. Those needs can relate to expansion or to the ability to operate in Northfield.

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comprehensive economic development plan: NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Identifying companies who can benefit from customized assistance, such as the manufacturing modernization services offered through the U.S. Department of Commerce's Manufacturing Extension Partnership (MEP) program. In the event of a layoff or plant closing, helping to coordinate services for affected workers, including re-training and career counseling.

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should promote the available programs for small businesses. This could be accomplished by providing links on the NEC website to state programs (such as the Small Business Development Loan Program offered by the Minnesota Department of Employment and Economic Development) or by providing fact sheets on areas of interest. Examples include how to get on the state’s vendor list, how to participate in export trade events, and how to improve business processes.

Tools. In addition to offering business plan assistance, the NEC

1B.2: Support small business development. Promoting and ensuring that small businesses are connected with available technical and financial assistance is an appropriate part of a business retention program. This task should be led by the Northfield Enterprise Center (NEC), which has recently been certified as part of the state’s small business development center network.

To be effective, intervention must occur early. As such, this strategy relies heavily on the information-gathering steps outlined above.

Understanding the role of financial tools, such as Employee Stock Ownership Programs (ESOPs).

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As part of this effort, the EDA should be aware of the tools available to help avert such actions or ameliorate their impact. Examples of these tools include:

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comprehensive economic development plan:

Selected Small Business Statistics, 2003 Employment % of Total % of Total Size of Firm Establishments Employees <20 72% 18% <50 78% 29% <100 81% 36% <500 86% 51%

Numerous studies have highlighted the important role that small businesses play in the nation’s economy. According to data compiled by the U.S. Small Business Administration, nearly 21 million workers were employed by firms with fewer than 20 employees in 2003. The roughly 5.2 million establishments in this class size represented nearly three-quarters of all employers during the same period.

small business statistics

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Appointing a small business ombudsman to serve as the primary point of contact for new and small business. This person would serve as a liaison between the business community and relevant city departments and commissions.

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access to capital should be a top priority of business retention and expansion programs. Examples could include the formation of a capital network (see box), as well as encouraging new lending models in conjunction with banks to meet the technology needs of businesses. Such models would provide loans to companies seeking to implement new technology. As part of this work, contacts should be established with the angel and venture capital community nationally, as well as at the state and regional level.

Capital. Working with the local financial community to improve

Conducting a review of development regulations, ordinances and approval processes to ensure that they do not pose an undue burden on small businesses.

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“business-friendly” can go a long way to enhancing the environment for small business owners. This could include:

Barriers. Taking steps to ensure that local governments are

entrepreneurship.)

Networking. Establish a regular meeting schedule, such as a quarterly business and industry meeting hosted jointly by the local chamber or trade association, where small business owners can discuss issues on a topical basis (such as workforce, supplier networks, start-up resources). Joint sponsorship of existing events held by organizations such as the NEC and the Northfield Chamber of Commerce could accomplish this task. Thought should be given to providing support on a regional basis and the relationship with entrepreneurship. (See Strategy 3D for more on

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comprehensive economic development plan:

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identifying potential angel investors linking with existing loan and investment funds (such as Southern Minnesota Initiative Foundation) enfranchising existing lenders in the value of non-traditional investment (banks and REITs)

The formation of a capital network consists of some of the following:

Capital networks are an important part of small business development. They vary from an informal group of potential lenders – including local banks, foundations, and individual investors – to a highly formal, federally regulated investment consortium. At all levels, however, their purpose is to increase the flow of capital to local businesses who do not readily meet the criteria of traditional lending. As a result, capital networks typically encourage flexible rates for loans, or, in the case of investment, a wide range of indirect assistance (including management expertise).

definition: CAPITAL NETWORKS

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Strategy 1C:

securing government funds relative to innovation, including the Small Business Innovative Research or SBIR program. Identify local recipients of such awards to learn more about the constraints faced in competing. Information on award recipients and other resources is available from the Small Business Administration’s website. (http://www.sba.gov/).

Leverage funds. Assist private companies in

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EDA should initiate a direct mail program to companies in each target sector. The mailings would consist of a one-page marketing letter (see box) designed specifically for each target industry that

Mail campaign. Using these databases, the

of companies in each target industry.

Database. Develop and maintain a database

1C.1: Build awareness among decision-makers in target industries. The EDA should initiate a marketing campaign designed around the targeted industry sectors.

Actions:

Implement a targeted industry recruitment strategy. The EDA should undertake a business recruitment campaign focused on the target industries outlined in this report, with an emphasis on the “niche opportunities” identified. Consideration must be given, however, to the land availability issues discussed above.

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comprehensive economic development plan:

bulleted list highlighting area’s advantages in key site selection factors, such as access to markets, transportation, labor availability, cost of business, available incentives, etc.

I would like more information about Northfield Please fax this letter to the Northfield Economic Development Authority at 507.645.xxxx

P.S. - Please take a moment to visit our web site at www.ci.northfield.mn.us/

Name Title

Sincerely,

I will be happy to prepare a site location comparison and incentive proposal for your specific project. For more information, fax this letter to xxx or contact me directly xxx or via e-mail at xxx. I look forward to hearing from you.

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As a competitor in the [INSERT TARGET] field, you too will find our community to be an ideal site to locate operations. If your company is considering an expansion of operations, I would encourage you to look at what Northfield has to offer. Some of the key factors about our city that companies find attractive include:

state depending on availability of data. Examples include industry employment and growth, wage rates, recent location decisions, productivity for mfg. workers, export trends.]

Northfield is a premier location for the [INSERT TARGET] industry. With an abundance of skilled workers and proximity to growing markets, the city has become a significant force in the region. [Rest of paragraph includes statistics that show strength of industry in region or

Dear [Name]:

Contact Title Company Address_1 Address_2 City, State ZIP

Date

Maximum length of 1 page

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

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campaign using a contact management system. This system should be flexible enough to allow staff to evaluate the effectiveness of each marketing channel (mail-outs, telemarketing, trade events) and adjust marketing activities accordingly. Simple

Metrics. The EDA should track the success of the target industry

information for each target industry sector. This would include identifying associations for each industry sector as well as following industry trends by monitoring trade publications or purchasing industry data and reports from private sources, such as Hoover’s, Economy.com, or relevant trade associations. Participation in industry trade events (trade shows) should be part of this effort, as it provides a means for increasing the region’s exposure as well as staying current on industry needs.

Intelligence. The EDA should compile and maintain resource

campaigns, the EDA should conduct four call trips per year (one each quarter) to regions where industry concentration is highest. These trips can be conducted separately or in conjunction with trade shows or other events. Where appropriate, include area business leaders on these trips.

Call trips. Based on the results of the direct mail and telephone

appointment setting campaigns to increase effectiveness. The purpose of these calls is to 1) identify companies with expansion plans, and 2) assess their interest in Northfield as a location for expansion. This telephone campaign can be conducted by staff. However, given the number of calls required to conduct such campaigns, use of a service agency with economic development appointment-setting experience may be preferable.

Follow-up. Direct mail campaigns should be followed up with

highlights the advantages of a Northfield location. Mailings should occur monthly and continue for at least six months.

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comprehensive economic development plan:

Many communities have implemented a pointbased system for awarding incentives. Under such as system, development proposals are awarded points for their performance along specific criteria. In addition to traditional economic development measures, such as job creation, capital investment, and wages, consideration is increasingly being given to conformance with community goals, such as use of green building materials and processes, compliance with neighborhood plans, and provision of affordable housing. These criteria are typically based on objectives and principles outlined in comprehensive plans or other significant planning efforts.

keeping score

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

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Information. Maintain and update information typically of interest to site selectors and others. To the extent possible, this information should be made available via the city’s website. (A

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city staff should call on site consultants in the Twin Cities as well as other major metropolitan areas (Chicago, Atlanta, Dallas). While a formal program of visits (i.e., quarterly) is most effective, resources may limit this action to visits made in conjunction with attendance at trade shows or other events.

Visitation program. To the extent feasible, EDA members and/or

campaign using material specifically designed for this purpose. The letter should highlight a different opportunity each month.

Letter campaign. Initiate a monthly site consultant letter

comprehensive matrix of such data standards is available from the International Economic Development Council’s website http://www.iedconline.org)

Database. Update and maintain a database of site consultants. (Provided by TIP Strategies under separate cover.)

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1C.2: Build awareness among corporate site selectors. Many businesses (medium to large market) hire site consultants to assist in their evaluation of potential expansion sites. The EDA should create a database of these consultants, target them through direct marketing and a visitation program, and invite them to the city to see specific projects.

databases can be established for this purpose using off-the-shelf software, such as Excel or Outlook. Customized software is also available, such as Pro-Active for Economic Development: http://www.proactive-is.com/html/actfored.html.

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comprehensive economic development plan: NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Strategy 1D:

in Northfield for site consultants and regional industrial and commercial brokers. These events serve multiple purposes. They raise the profile of the community by showcasing desirable development opportunities. They bring fresh ideas to Northfield. And they create connections with investors and developers in the region. This is an ambitious undertaking and should be delayed to the latter stages of the plan’s implementation.

Event. The EDA should consider holding a “developer’s day” event

1D.1: Develop media strategy. Develop a media strategy specifically for economic development that focuses on submitting stories and press releases to the local and regional media on a regular basis (see box).

Actions:

Raise awareness of Northfield in the region. In addition to the broader target recruitment efforts described above, marketing should also focus on building regional awareness. The purpose of this approach is to raise the city’s profile in the region and position it to capture future business expansion out of the Twin Cities region.

1C.3: Establish written incentives policy. The EDA should develop a formal incentives policy that reflects the goals outlined in this plan. This policy should provide clear guidance on the standards that must be met to qualify for incentives. As a general guideline, the incentive policy should emphasize investment in addition to “jobs created.” Investment should be measured by direct capital investment (machinery and equipment, buildings, and aggregate payroll). Emphasis should be placed on employers that create higher wage jobs (i.e., some percentage above the median wage for the region). “Clawback” provisions, i.e., those conditions under which an incentive would be withdrawn, should be clearly stated.

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comprehensive economic development plan:

Develop a list of reporters with relevant publications and contact them to determine the types of stories they are interested in. Based on these conversations, provide press releases on a regular basis. Press releases should be focused on a particular event or the release of a new report or indicator about the area.

9 Copies of other articles that have been published about the region.

9 Fact sheet about the area, including list of major employers, unique features of the area, photographs, and a listing of new expansions and locations, if any.

9 Cover letter to answer specific questions or address specific topics the writer is covering, as well as offering to put the writer in touch with potential interviewees.

A press kit should be developed to promote Northfield’s economic development opportunities. Among the materials to be included in the press kit are:

Regular contact with local and regional media can generate interest in the community and raise its overall profile. The inclusion of smaller communities in various “best of” lists is often the result of this kind of marketing.

media relations

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Profile. Create a brief profile touting the region’s positive aspects to be used by the Ambassadors and other area business leaders.

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1D.3: Leverage conferences and networking opportunities. Local organizations sponsor a wide range of events. Posting these to a joint calendar can keep stakeholders informed and encourage greater participation. The calendar on the city’s website could be used for this purpose, with links to the calendar from relevant organizations, such as the Northfield Chamber of Commerce, the Northfield Enterprise Center, and the colleges. The EDA and other city leaders should identify relevant organizations (such as regional chambers, industry

Engage. Meet regularly with the Ambassadors keeping them up to date on current initiatives, progress, and honing the city’s marketing message. Consider creating a mechanism for the Ambassadors to refer prospect leads.

Northfield Chamber of Commerce could serve as a starting point for this task. In addition to promoting the city during the course of their business interactions, this group could be given a specific charge, such as monitoring trends in target industries. Ambassadors could also be invited to participate in prospect visits.

Assemble candidates. Identify business leaders most likely to influence decision makers and invite them to establish a Northfield Ambassadors program. The Ambassadors Committee of the

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1D.2: Enhance Northfield Chamber’s Ambassador efforts. Executives, managers, and others in local firms often travel to meetings with professionals from other firms. These individuals can serve as your best marketing channel. The program would have a two-fold purpose: 1) build an awareness of the community’s strengths among area business executives, and 2) provide information for allowing them to spread a more positive image of the region in their business relationships.

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comprehensive economic development plan: NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Strategy 1E:

Create task force. This task force should include representatives from the city, the EDA, the colleges, as well as major employers and other stakeholders. The purpose of the task force would be to research specific questions related to the opportunities presented by the existing fiber network owned by the colleges. These include evaluating the potential for leasing any excess capacity, understanding “last-mile” technology issues, and determining the city’s role in furthering community-wide access.

Issue request for proposal. The city should issue an RFP to Internet service providers to help better understand the additional costs and issues involved in making fiber connectivity available outside the colleges.

1E.1:

1E.2:

Actions:

Explore options for leveraging existing fiber network. The colleges’ installation of fiber to allow connections to Internet2 presents an opportunity that should be further explored. First, the initiative resulted in Northfield’s designation as a “point of presence.” This designation translates into the potential to provide dramatically faster and cheaper Internet access for local residents, businesses, and organizations than is currently available. The St. Olaf/Carleton initiative could also facilitate the provision of ultra high-speed connections throughout the community. In order to exploit this opportunity, the city must better understand the available options for leveraging this resource.

This task also includes the promotion of Northfield events — whether hosted by the city, the colleges or other organizations — on a regional basis. When feasible, the EDA and others should consider hosting conferences or arranging networking opportunities on areas of concern to businesses in the region.

trade associations) and events within the region in which to participate.

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comprehensive economic development plan: NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

For this reason, it may seem somewhat surprising to talk about the downtown in terms of additional growth, but conversations with developers and retailers suggest that this

While downtown Northfield is unique, its problems are not. The health of downtowns across the country hinges on the health of downtown retail. Independent retailers often end up operating businesses that are “labors of love,” working long hours for small profits. As such, they are often unable to absorb rising costs or to offset even a small amount of competition from national chain stores. Faced with dramatic increases in property taxes and competition from larger retailers locating on Highway 3, the future of Northfield’s independent retailers is precarious.

Of the city’s many assets, the historic downtown is central to Northfield’s sense of place. Downtown Northfield provides a sense of character missing in many cities and contributes significantly to the community’s economic vitality. Existing retailers provide an amenity for residents, generate employment, and add to the city’s tax base. Public spaces provide opportunities for social and cultural exchanges. Upper floors of existing buildings offer attractive options for housing and commercial space, helping to diversify the city’s economic base. Vacant or underutilized properties create opportunities for infill and redevelopment.

Northfield embodies quality of place. A tour of similarsized cities surrounding Minneapolis quickly dispels the notion that the Northfield experience can be easily replicated. Indeed, on a national level, the city can justifiably be ranked in the top tier of small towns. The downtown has vibrancy and a youthful feel that helped earn it a place among the “20 Best North American Districts, Downtowns and Neighborhoods” (Project for Public Spaces, 2004). The Cannon River adds a distinctive natural feature, with amenities in the form of parks, bridges, and promenades. Cultural opportunities abound, due in large part to the presence of Carleton and St. Olaf Colleges. All of these elements combine to give Northfield a distinct advantage over many other non-metropolitan communities.

OPPORTUNITY 2: MAINTAINING NORTHFIELD’S QUALITY OF PLACE

comprehensive economic development plan:

By contrast, quality of place considers what is attractive to a range of residents, both old and new. The idea of quality of place accommodates growth and recognizes the benefits of change. It recognizes that one person’s “good place to raise a family” might translate into another’s “there’s nothing to do in this town.” Quality of place is about providing options, not just for current residents, but for those who will be residents in the future.

Much has been written about the importance of quality of life to the site selection process. Communities throughout the nation have positioned themselves by touting their advantages in this regard—good schools, safe streets, pleasant weather. We agree these factors are important. We take issue only with the narrowness of the focus. Quality of life assumes that everyone thrives in the same environment and is attracted to the same amenities. It assumes that current residents’ view of what makes a community would be shared by all.

Economic development activities are often undertaken in a vacuum—as if “jobs” were somehow independent of the people who hold them. Workers need places to live, amenities, and educational opportunities. Quality housing, good restaurants and good schools are not luxuries for an educated workforce—they are necessities. Communities that fail to address these concerns will fall behind those that do.

Redefining PLACE

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Even with this support, however, a vibrant downtown is not guaranteed. In other words, downtown Northfield must be able to afford its own history. A market center in 2006 does not look like one in 1906. Retail, housing, services, amenities, and special events all play into this.

City leaders and organizations like the Northfield Downtown Development Corporation (NDDC) have demonstrated a commitment to the downtown through initiatives such as “The Action Squad,” the Downtown Strategies Steering Committee, the downtown directory, and the recently completed Streetscape Framework Plan. Supporting these and similar efforts will be important to the future of the downtown.

As property values continue to rise and other retail areas form within the city (or in the region), these retailers may find it increasingly difficult to remain downtown. Without a comprehensive approach that looks to increase foot traffic, address tax issues (to whatever extent possible), integrate downtown with newer development, and maximize the opportunities presented by the Cannon River – there is no guarantee the community will continue to protect its position. These are all strategies that can support the continued health of the downtown. Without them, the competitive pressures from Dundas and surrounding communities will compromise the success of downtown.

The second opportunity revolves around the Cannon River (see map). Recent development proposals, including the Q-Block development initiative and the Riverfront Redevelopment project, can set the tone for additional redevelopment and infill projects along the river. Emphasis should be placed on orienting new development to the river. By this we mean ensuring that buildings have access to the river as well as to the street, creating additional pedestrian areas along the riverfront, requiring common architectural elements and adequate lighting — and encouraging uses that relate to the riverfront. These uses could include sporting goods stores (with rental options), cafés, and offices with river views.

opportunity has gone unrealized. Specifically, downtown Northfield has failed to capitalize fully in two important areas. The first is the recruitment and attraction of professional services to the downtown. Competition from the Twin Cities makes recruitment of large professional services firms impractical. However, expanding the mix of commercial options can play an important role in drawing professional services to the downtown. Broadening the definition of “mixed use” projects to allow for more flexible development is one aspect of this strategy.

OPPORTUNITY 2: MAINTAINING NORTHFIELD’S QUALITY OF PLACE

comprehensive economic development plan:

Q-Block Area

Riverfront Redevelopment Site

Cannon River Opportunity Area

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Northfield’s retail strategy must also be cognizant of the city’s relationship to neighboring communities. It is one thing to say that specialty retail will define Northfield and that “big box” development can go outside the city. It is quite another to realize that the viability of locally owned business (and a vibrant downtown) depends upon making Northfield competitive with its neighbors. A mix of retailers that serves both local citizens and draws in students and visitors is essential.

Some of the difference is probably attributable to Northfield’s large student population. This group typically spends less than other city residents in a number of retail categories. More likely, the leakage reflects gaps in the city’s current retail mix and competition from metropolitan area counties. Of the 14 merchandise groups evaluated, Northfield’s sales were below the expected level in 7 categories: building materials (nearly 62 % lower than expected), hotels (-31%), personal services (-26%), food (-21%), repair and maintenance services (-14%), gasoline stations (-9%), and apparel (-8%). Sales were highest relative to expected levels in miscellaneous retail (143 percent higher than expected) and eating and drinking places (+62%). These findings can provide a guide to the city’s retail strategy.

Integral to the discussion of quality of place is the health of Northfield’s retail sector generally. While the city serves as an employment center, drawing in workers from across the region, it is not serving as a hub for retail spending. The lack of a local retail sales tax complicates the discussion of “retail leakage.” However, a recent analysis by the University of Minnesota Extension Service suggests that Northfield is not capturing the full potential of retail spending in the community. The Extension Service study compares per capita spending patterns in Northfield against state averages to determine “gaps” in local spending. Based on this study, Northfield total retail sales in 2003 were nearly 14 percent below expected sales.

In fact, housing and services are among the best vehicles for anchoring retail. They offer a reliable base of customers – from dining to convenience shopping – and they create a critical mass of downtown growth that many communities are actively seeking.

OPPORTUNITY 2: MAINTAINING NORTHFIELD’S QUALITY OF PLACE

comprehensive economic development plan:

$2.84 $3.7 $2.33 $2.89 $42.91 $2.54 $18.16 $6.10 $22.45 $1.75 $1.95 $8.11 NA NA $208.16

$3.29 $2.20 $2.78 $42.86 $2.77 $20.00 $7.11 $28.34 $2.42 $2.82 $21.20 $52.17 $8.75 $240.73

Actual Sales

$2.27

Expected Sales

-$32.57

-$5.89 -$0.64 -$0.87 -$13.09 NA

-$1.01

+$0.41 +$0.13 +$0.11 +$0.05 -$0.23 -$1.83

+$0.57

-13.5%

-20.8% -26.3% -30.8% -61.7% NA

-14.2%

+12.3% +5.7% +4.1% +0.1% -8.3% -9.2%

+25.2%

Source: University of Minnesota Extension Service, Retail Trade Analysis Report: Northfield & Rice County, Minnesota, p. 17. (1) Total sales includes all retail and service categories, including some categories not shown.

Merchandise Group Miscellaneous retail Eating & drinking Amusement & recreation Furniture stores Electronics Leisure goods Auto Apparel Gasoline stations Repair, maintenance services Food Personal services Hotels Building materials General merchandise Health, personal stores Total sales(1)

Variance Between Actual & Expected In Dollars As % of ($millions) ($millions) ($millions) Expected $14.48 $35.11 +$20.63 +142.5% $15.18 $24.58 +$9.40 +61.9%

trade area analysis by merchandise category: NORTHFIELD 2003

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Northfield’s continued position as a “freestanding” community will depend upon re-defining its position in the region on a number of fronts. The city is fortunate to have its own newspaper (Northfield News), radio broadcasts (KRLX 88.1 FM, KYMN 1080 AM), and an active community website (Northfield.org). These things all contribute to a sense of identity and are an important aspect of quality of place. But in the face of continued residential growth in Northfield and surrounding towns, Northfield leaders must continually reinforce this identity. Maintaining a healthy and vibrant downtown; offering adequate retail, services, and cultural amenities for existing residents; providing a variety of housing options; and redefining Northfield’s relationship with neighboring communities are central to maintaining the city’s quality of place and allowing the city to thrive. The following strategies provide a framework for accomplishing these objectives.

Rising housing costs create an issue both for residents and for businesses. Anecdotal evidence suggests that housing costs already limit the city’s ability to accommodate workers, particularly young people. A simple index comparing median home prices to median household incomes illustrates Northfield’s housing affordability relative to the US. Anything above 100 is less affordable than the U.S. average; anything below is more affordable. The index reveals that housing affordability in Northfield in 2000 was comparable to the U.S., but less affordable than in the state as a whole or the Twin Cities metro area. By contrast, Rice County was significantly more affordable, despite the upward pressure exerted by Northfield’s housing costs. Rising land costs coupled with expansion out of the metropolitan area has driven the price of new housing even higher than at the time of the 2000 Census. If this situation is not addressed, Northfield becomes increasingly vulnerable to the risks described earlier.

The question of Northfield’s relationship to neighboring communities goes beyond retail, however. Accommodating population growth is another important issue with implications for both quality of place and regional collaboration. If residential growth is restricted in Northfield, the result of either high housing costs or limitations on housing development, much of this growth will be pushed into surrounding communities. As these communities grow, they offer alternatives to living and shopping in Northfield. These alternatives heighten the competitive pressure on the city. They can steadily siphon sales away from Northfield’s retailers.

OPPORTUNITY 2: MAINTAINING NORTHFIELD’S QUALITY OF PLACE

comprehensive economic development plan:

$47,111 $54,370 $48,651 $49,972

Minnesota Twin Cities Rice County Northfield

$142,900

$123,600

$141,400

$122,400

$119,600

Median Home Value

100.4

89.2

91.3

91.2

100.0

Housing Affordability Index

Sources: U.S. Census Bureau, TIP Strategies, Inc.

$41,994

USA

Median Household Income

Housing Affordability Index, 2000

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Strategy 2A:

•

Applying distinctive architectural and urban design elements from the downtown Streetscape Framework Plan throughout the Cannon River corridor. Linking existing pedestrian areas and ensuring that new development ties into these systems. Ensuring that existing zoning and ordinances create the desired feel for the area. For example, set-backs requirements should be minimized to help create a human scale and discourage large surface parking areas in front of

–

Design. The Cannon River can serve as a bridge connecting the historic downtown with other parts of the community and should be treated as a corridor for planning purposes. This means that issues such as urban design standards, parking and traffic circulation, and infrastructure planning should be addressed across the area to the extent possible. Examples of corridor planning principles include:

2A.1: Activate the Cannon River. Expanding and revitalizing the entire riverfront should be a pivotal part of Northfield’s downtown strategy. Emphasis should be placed on identifying development and th redevelopment sites in the area south of 5 Street (see map). In addition, current projects that relate to the river, such as The Crossing at Northfield (formerly the Riverfront Redevelopment Site) and the Q-Block, should be reviewed for their orientation to the river and for their ability to spur additional activity in the downtown.

Actions:

Maintain and enhance the existing downtown. Northfield’s historic downtown is one of the community’s most significant assets. Ensuring its survival is the highest priority within this challenge.

OPPORTUNITY 2: MAINTAINING NORTHFIELD’S QUALITY OF PLACE

comprehensive economic development plan:

Q-Block Area

Riverfront Redevelopment Site

Cannon River Opportunity Area

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

those that combine residential, commercial, and/or office uses in a single project, can help attract talent to the area. In addition to reducing vehicle miles traveled by allowing more people to walk or bike from home to work or by combining trips, mixed-use developments can also provide opportunities to mingle with neighbors, creating a stronger community.

Mixed-use projects. The presence of mixed-use developments,

river, the city should consider including local and regional developers early in the process. This can be done by issuing a formal solicitation of design ideas for a particular site, by inviting developers to the community for a roundtable or forum on development in Northfield, or by hosting a public charrette process. (See strategy 1A.3.)

Development community. As part of the planning process for the

Reviewing existing regulations to identify any that would hinder redevelopment unnecessarily.

2A.2: Increase density of uses in downtown. A December 2003 report prepared by DSU Research found that downtown Northfield had the strongest base of office users in the city. According to the DSU inventory, four out of five office users in the region were located downtown at that time. The report estimated that as many as 750 workers could be accommodated in downtown Northfield. This finding provides support to the idea of continuing to diversify the mix of commercial opportunities in the downtown. While economic developers are accustomed to providing incentives to manufacturing firms, they rarely turn their attention to the service sector. This is both possible and desirable. This recommendation calls for direct recruiting, creative financing, and general support:

•

–

buildings; parking standards should be calculated in a manner that considers opportunities for shared parking.

OPPORTUNITY 2: MAINTAINING NORTHFIELD’S QUALITY OF PLACE

comprehensive economic development plan: NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

network events sponsored by the EDA and other organizations, and help in accessing new clients. For example, helping professional service firms access public sector contracts.

General support. This would include job training assistance,

above the median income and who are in an expansion mode should have access to incentives. These incentives can include low interest loans for building improvement and capital equipment (machinery and equipment ranging from copiers to computers). The city’s Downtown Revolving Loan Fund provides some funding for building renovation. Other creative financing options might consist of favorable lease rates in downtown buildings that are currently unoccupied. The EDA or the city could assist in this effort by subsidizing rents for desired targets.

Creative financing. Professional service firms who pay wages

services and business support firms in ways similar to traditional manufacturing recruitment. This means identifying gaps, targeting specific firms capable of, and interested in, expanding, and offering incentives, particularly for those firms that locate downtown. The ideal target for this effort would be firms that have high levels of “face time,” such as law firms, medical and dental offices, architects, engineers, and real estate brokers. In addition to being high-wage industries, these businesses can generate additional foot traffic, benefiting downtown merchants.

Recruitment. The EDA should actively recruit professional

2A.3: Encourage downtown housing. Much attention has been given in recent years to the importance of creating a “24-hour” environment downtown. Increasing options for downtown living plays a significant role in this equation. However, like any housing market, “downtowns must meet at least these two conditions — a safe, quality environment and investor confidence — before they can effectively

•

OPPORTUNITY 2: MAINTAINING NORTHFIELD’S QUALITY OF PLACE

comprehensive economic development plan: NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Conflicting uses. Balancing the desire for employment-generating uses and entertainment venues against the demands of residential development can be a significant challenge in downtown housing. While these conflicts can be unavoidable, policies should be considered that can help minimize them along with procedures for complaint resolution. Examples include noise ordinances that restrict the decibel level of entertainment venues or incentives for sound proofing enhancements made during renovations. Market analysis. Understanding the market for downtown housing is

•

Ten Steps to a Living Downtown, Brookings Institution, 1999, p. 11.

also critical. The presence of the colleges and Northfield’s “free standing” status translates into a slightly different market for downtown housing than is the norm (see box). DSU Research’s December 2003 study revealed that nearly half (49%) of downtown residents were between the ages of 18 and 24. The study also found that only 14% of downtown residents owned their household unit. Increasing the percentage of non-students and raising the level of home ownership in the downtown should be a priority. Mixed use projects, such as Mendota Home’s Bridge Square project, specifically address this. As proposed, the project would create 26 housing units with retail spaces and underground parking on the site of the former Community National Bank building.

Neighborhood identity. Creating an identity for downtown is an important part of attracting residential development. Northfield has an advantage in this regard in that the historic identity already exists. Implementation of the recently completed Streetscape Framework Plan will help to further establish downtown’s identity.

•

compete for residents.” Important ingredients for successful downtown residential development include:

OPPORTUNITY 2: MAINTAINING NORTHFIELD’S QUALITY OF PLACE

comprehensive economic development plan:

TIP Strategies phone interview

There are two types of downtown residents. The first group has always been there: the young and single, the recently married, the dual-income-nokids group (DINKs). Most of these are under 35. The other group is less well known but growing quickly. These are the empty-nesters — those active adults and seniors who are over 50 and all the kids have left home. The demographic inbetween (couples in their 30s to 50s with kids) are mostly in the suburbs.

Downtown living has typically appealed to two groups, described by World Business Chicago (the city’s non-profit economic development organization) as follows:

who lives downtown?

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Strategy 2B:

2B.2: Compile existing data on the downtown retail market. This research should build on existing studies, including the December 2003 DSU Research study and the retail trade area analysis conducted by the University of Minnesota’s Extension Service. Analyze consumer expenditure patterns in the area, documenting the needs of existing retailers (particularly in the downtown), identifying current “gaps” and opportunities for retail development in the region, and providing information on site location factors for existing and potential

2B.1: Formalize retail working group. There are several organizations in Northfield whose missions relate to strengthening the city’s retail environment. The intention of this task is not to alter existing plans or initiatives, but rather to ensure that gaps and overlaps are identified and existing resources are maximized. This group should meet monthly or quarterly to coordinate planning and marketing initiatives and should include representatives from the Northfield Downtown Development Corporation, the Retail Committee of the Northfield Chamber of Commerce, the Northfield Convention & Visitors Bureau, the EDA, local developers, tourism-related groups, and city staff. Representation by the colleges should also be encouraged to identify opportunities for coordination with college events or special needs.

Actions:

Develop coordinated retail strategy. While housing and professional services are an important part of the picture, the health of Northfield’s existing downtown will ultimately depend on its continued ability to function as a retail center. Traditional economic development theory sees retail as a spinoff effect from the manufacturing sector. However, many successful communities now recognize that retail is increasingly seen as an amenity without which other economic sectors find it difficult to recruit workers. People want and expect retail, and they have become increasingly refined in their specific interests. Balancing consumer demand for national chains with the needs of downtown is at the heart of this strategy.

OPPORTUNITY 2: MAINTAINING NORTHFIELD’S QUALITY OF PLACE

comprehensive economic development plan: NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

•

assets. Examples include outdoor recreation, arts, and collegeoriented retailers.

Assets. Retail recruitment should also be linked with the area’s

specialty retail that is of a scale appropriate for the downtown. Efforts should emphasize the ability of those retailers to attract dollars from outside of the region.

Scale. Choice of prospects should focus on higher-end and

“big box” development occurring on Highway 3 should be considered in the choice of prospects. Currently there is a clear distinction between the offerings downtown (independent, specialty retail) and those available along Highway 3 (mass merchandise). This strategy recommends that Northfield move towards better integrating these two areas. This can be accomplished in two ways. First, explore the feasibility of attracting small, regional chain retail into the downtown. Saratoga Springs, New York is a good example of a community that has been successful at this task. Second, future developments along Highway 3 should be required to meet design standards that reflect those of the downtown, such as repeating specific themes from the downtown palette.

Integration. The relationship between downtown retailers and the

2B.3: Identify appropriate retail prospects. Based on the findings of the retail analysis outlined above and the work of the retail working group, appropriate prospects should be identified.

retailers should all be addressed. This step should include an inventory of existing sites, including redevelopment opportunities, as well as potential barriers to their development, such as the cost of infrastructure rehabilitation in the downtown.

OPPORTUNITY 2: MAINTAINING NORTHFIELD’S QUALITY OF PLACE

comprehensive economic development plan: NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

retailers directly, the core of this strategy should be focused on retail developers who represent retail tenants. Regional examples include United Properties’ Midwest Retail division, Exeter Realty Company and City Center Retail (Minneapolis office).

Developers. While some recruitment efforts may be aimed at

Awareness. Raising awareness among local retailers of the area’s

•

tourism assets helps ensure that local businesses are prepared to capture retail spending associated with specific tourismrelated activities. Major events, such as Defeat of Jesse James Days, are likely to be on the radar screen of local retail and hospitality establishments. However, lower-profile events, such as

Inventory. The city and the EDA should participate in the maintenance and promotion of an inventory of local attractions and tourism assets. The “Things to Do” section of the Northfield Convention & Visitors Bureau website or the Northfield.org site could serve as the foundation for this effort. In addition to promoting tourism and raising awareness about local assets, the inventory can illuminate areas where Northfield is lacking. One example is the availability, diversity, and quality of overnight accommodations in the region. Adequate accommodations are a major factor in the success of a tourism-related strategy (and therefore, a retail strategy). An analysis of retail sales potential (see page 32), indicates that Northfield is not capturing its full share in this category.

•

2B.4: Link retail and tourism. Retail development must be viewed with an eye towards capitalizing on Northfield’s tourism activity. The region has a number of assets in this regard—significant festivals and events, a variety of outdoor recreational opportunities, and the cultural offerings of the colleges and other organizations. In other words, attracting tourists only benefits the area directly if there is a mechanism for capturing retail sales dollars.

•

OPPORTUNITY 2: MAINTAINING NORTHFIELD’S QUALITY OF PLACE

comprehensive economic development plan: NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Strategy 2C:

Signage. “Way-finding” signage is designed to make it easy for non-residents to get around. Signs should guide visitors to shopping areas and major attractions. Current public improvement efforts, including the recently completed Streetscape Framework Plan and approval of a Historic Downtown Northfield sign along I-35, help to accomplish this objective.

Identify best practices. State budget cuts and continued demand for services have raised interest statewide in identifying opportunities for cooperation and collaboration. The State Auditor’s Office and the League of Minnesota Cities have compiled extensive databases of best practices in a number of areas.

Form Rice County working group. This group would explore potential for collaboration among Rice County communities. Dakota County’s

2C.1

2C.2

Re-define Northfield’s relationship to its neighbors. Continued residential growth in and around Northfield will place an increasing burden on the resources of the community and surrounding areas. The city’s success will depend to some degree on its ability to reevaluate current relationships. While economic development initiatives are typically competitive by their nature, there are situations where a collaborative approach makes sense.

•

regional cycling events or college-sponsored conferences, may not be. This may mean offering extended hours of operation to accommodate specific events or designing sales and marketing efforts around a related theme. For large or regularly occurring events, special arrangements may be desirable, such as providing shuttle service to the downtown from the event location. The EDA should work with the Northfield Downtown Development Corporation and others to ensure that retailers are aware of community events. A community calendar, such as that offered on the newly redesigned City of Northfield website can play an important part in this task.

OPPORTUNITY 2: MAINTAINING NORTHFIELD’S QUALITY OF PLACE

comprehensive economic development plan: NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

High Performance Partnership effort can provide valuable lessons for Rice County. This plan identified six target areas for collaboration among Dakota County communities, including coordinating public safety and law enforcement activities, sharing information technology purchasing and training, and joint purchasing of health insurance.

OPPORTUNITY 2: MAINTAINING NORTHFIELDâ&#x20AC;&#x2122;S QUALITY OF PLACE

comprehensive economic development plan: NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Yet it is clear that the community has not been entirely successful in realizing the benefits of their presence. Given their institutional missions as liberal arts campuses, Northfield has not greatly benefited from the additional public and private investment that higher education facilities often generate. The research and development or startup enterprises often

Northfield is also fortunate to have institutions that recognize the importance of strong civic ties. While their presence has a direct impact on the city from a fiscal perspective, making as much as one-third of property in town nontaxable, the colleges contribute directly and indirectly in a number of ways. These range from direct cash payments to the city (the colleges contributed $65,000 each in 2005) to the impact of volunteer programs coordinated by each institution. This focus on civic engagement is one factor behind St. Olaf’s first place ranking in “Town & Gown Relations” in the most recent national survey of college students published annually by The Princeton Review.

From an economic development standpoint, Northfield derives substantial benefits from being home to Carleton and St. Olaf Colleges. These institutions of higher learning have provided the community with a degree of stability that has largely shielded Northfield from larger macroeconomic forces. During the last quarter decade, for example, the area has not experienced a single year of employment declines. In addition, the large number of students living in Northfield has helped sustain local retail spending.

As worker shortages loom nationwide (see graphic, next page) and competition for workers increases, attracting and retaining talent has become the focus of economic development organizations across the country. The City of Northfield starts the game with a unique advantage due to the presence of St. Olaf and Carleton Colleges. Few cities of Northfield’s size are fortunate enough to have one institution — let alone two — directing a steady stream of young people to the community year after year. Collectively, the colleges enroll nearly 5,000 students. They rank among the nation’s best and brightest. The fact that Northfield can be considered a potential residence for a large pool of talented individuals should work to the community’s advantage throughout the Midwest.

OPPORTUNITY 3: ATTRACTING AND RETAINING TALENT

comprehensive economic development plan:

As a result, competition for labor is expected to increase. Focusing on the attraction and retention of talent should be an important part of any economic development strategy.

National trends, most notably the aging of the Baby Boomers, suggest that demand for workers will soon outstrip supply. This trend is particularly acute in older industrial regions, such as the Northeast and Midwest.

It means ensuring that the employees and companies that have been responsible for Northfield’s growth see a reason to remain in the area.

The concept of talent means more than a skilled workforce. It means recruiting talented people as well as cultivating the current talent pool represented by students.

Redefining TALENT

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

2005

2010

2015

2020

2025

2030

2035

Annual change in US working age population Average annual job creation since WWII

2040

2045

2050

Sources: TIP Strategies, U.S. Bureau of Labor Statistics, U.S. Census Bureau

A comparison of annual average job creation with projections of the number of new workers that will enter the workforce each year reveals an impending shortage of workers at the national level that is expected to last for decades.

0.0

0.5

1.0

1.5

2.0

The Approaching Deficit of Workers in the U.S.

Northfield’s situation is compounded by rising housing costs. This makes it difficult for graduates or young professionals to remain in the area even if they are able to find work. The cost of housing was cited as an issue by both residents and employers. While housing in Northfield is affordable relative to other areas of the country, costs are higher than elsewhere in the region. In addition to its impact on the community’s ability to accommodate young professionals, major employers listed housing costs as a perceived barrier to the recruitment and retention of workers. Evidence of the city’s challenges to attracting and retaining young professionals can be seen in the city’s age structure (see graphic at right).

associated with university-related economic development are not readily apparent. As four-year institutions, St. Olaf and Carleton do not offer graduate study programs, meaning the most motivated students often leave the area to continue their education. A lack of economic opportunity (real or perceived) drives those who do not wish to pursue graduate studies to look elsewhere for challenging, high-wage employment.

OPPORTUNITY 3: ATTRACTING AND RETAINING TALENT

comprehensive economic development plan:

(in millions)

< 10 yrs.

10-19 yrs.

18%

Northfield Rice Co. Minnesota

20-29 yrs.

30-39 yrs.

-5% 40-49 yrs.

66%

50-59 yrs.

57%

60-69 yrs.

25%

70-79 yrs.

24%

80+ yrs.

Sources: TIP Strategies, U.S. Census Bureau

An analysis of population change by age group between the 1990 and 2000 censuses reveals a drop in the share of residents age 30 to 39. In part, this shift represents the movement of the baby boom generation. In other words, the group of people who were 20 to 29 in 1990 was significantly smaller than those aged 30 to 39 at that time. However, Northfield experienced a sharper decline in this population group than either the county or the state, suggesting other forces are at work. In terms of its share of the population, 30 to 39 year-olds are also underrepresented in the city, comprising just 10 percent of the city’s total population in 2000 versus roughly 15 percent of the population nationally.

-20%

-10%

10%

20%

30%

40%

50%

60%

70%

27%

Population Change by Age Group, 1990 to 2000

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

% 48.6% 5.8% 4.5% 3.9% 3.3% 33.9% 100.0%

Number 2,717 327 250 216 185 1,895 5,590

19.2%

Northfield Faribault Bridgewater Township Webster Township Northfield Township Other MN Cities* Total Tracked Commuters

Number 2,717 486 393 158 128 2,302

% 43.9% 7.9% 6.4% 2.6% 2.1% 37.2%

Tracked Commuters

43.7%

% of Tracked Commuters Earning less than $12,000$35,000 $12,000 34,999 or more 21.4% 36.7% 41.9% 21.2% 46.1% 32.7% 20.6% 34.4% 45.0% 18.4% 36.1% 45.6% 22.7% 37.5% 39.8% 13.2% 32.7% 54.2%

37.2%

% of Tracked Commuters Earning less than $12,000$35,000 $12,000 34,999 or more 21.4% 36.7% 41.9% 18.7% 35.5% 45.9% 20.8% 44.0% 35.2% 19.0% 38.0% 43.1% 18.4% 38.4% 43.2% 15.9% 37.0% 47.1%

Question 2: Where do people who work in Northfield live?

Northfield Minneapolis Lakeville St. Paul Faribault Other MN Cities* Total Tracked Commuters

Tracked Commuters

Question 1: Where do people who live in Northfield work?

Northfield Commuting Patterns, 2001 Q2

$36,637 $27,982 $37,849 $36,686 $35,774 $40,741

(2001 est.)

Ave. Annual Earnings

$35,855

$36,637 $36,939 $32,695 $36,280 $35,348 $35,847

(2001 est.)

Ave. Annual Earnings

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Commuting patterns reveal that Northfield is already highly 6,184 100.0% 18.2% 35.8% 46.0% $38,850 reliant on communities throughout the area to supply much Source: Excensus LLC based on the U.S. Census Bureau’s Local Employment Dynamics data series. Data are based on survey and of its labor force. For example, more than half of workers at should be used as an indication of general trends. local companies commute from outside the community. *NOTE: Other Minnesota cities includes places and townships that do not rank as one of the top five destinations or sources for workers and were, therefore, unavailable from this dataset. While many of these commuters undoubtedly work for companies within the traditional industrial sector, it is also worth noting that Northfield’s most highly paid workers commute from Dakota and Hennepin Counties. The relatively high cost of housing contributes to these commuting patterns and to the city’s inability to attract and retain young people.

Northfield’s relative abundance of highly educated residents and modest population growth notwithstanding, strains are evident in the labor market. For example, demographic groups that are typically employed in entry level positions, or are in their most productive years (20-40 years of age), are not growing locally. As a result, Northfield’s workforce is aging at a rapid rate. In addition, the labor force is not growing in Northfield or Rice County. This results in tight labor market conditions, as evidenced by extremely low unemployment rates. It may become increasingly difficult for Northfield employers to attract workers from other areas—except through higher wages—as unemployment rates continue to fall throughout the greater Minneapolis/St. Paul region.

Despite Northfield’s difficulty in retaining former students, area employers still enjoy access to a highly educated workforce. For example, educational attainment data reveal that 43 percent of Northfield residents (25 years of age or older) are college graduates, compared to 27 percent statewide and 24 percent nationally. Undoubtedly, access to such a large number of talented workers raises the competitiveness of firms operating in Northfield—especially “white collar” enterprises.

OPPORTUNITY 3: ATTRACTING AND RETAINING TALENT

comprehensive economic development plan:

The city’s ability to work with the colleges and other relevant organizations to address the issues identified in the plan will be a large factor in the community’s ability to attract and retain its future workforce.

Improving the quality of the student experience must relate to this effort. Creating a positive association with their time in Northfield increases the chance they will consider returning to Northfield later in life – to start a business or join an existing venture. This means providing opportunities to engage students in social and cultural issues, creating a cultural climate and a downtown that is welcoming, and facilitating initiatives between the colleges and the city.

The growing relationship of higher education to economic development and the opportunity presented by the graduates of St. Olaf and Carleton make the attraction and retention of alumni the most promising strategy for developing Northfield’s talent base. Given the obstacles, retaining graduates may not be a realistic option in Northfield. The city may be better served by re-capturing alumni — those that have completed their graduate studies and may be looking to start a family or a business venture. This strategy would include compiling alumni databases, conducting e-mail surveys, and developing promotional materials to keep the “Northfield brand” fresh in the minds of former students.

Finally, the influx of Hispanics during the last decade has created disparities that the city should address. These disparities — most notably, educational attainment (54 percent of adults in this group have not completed high school) and language barriers (44 percent of Hispanics 5 years or older speak English “not well” or “not at all”) — are not unique to Northfield. However, they bear directly on the city’s economic future. Anecdotal evidence suggests that this group is not well-integrated in the community, with particular concerns raised in connection with K-12 education. While integration is important in all age groups, failure to integrate children and young people has the greatest impact in terms of the city’s future employment base. Continued growth of this ethnic group has economic consequences that will increasingly influence housing, employment, and the social fabric.

OPPORTUNITY 3: ATTRACTING AND RETAINING TALENT

comprehensive economic development plan: NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Strategy 3A:

•

campaign. This would include creating letters, direct mail materials, and website linkages aimed at increasing alumni’s awareness of opportunities and advantages of living in Northfield.

Mail and e-mail campaign. Enlist the colleges in a formal alumni

Where applicable, specific actions should be coordinated with class reunions and related events.

Attracting former students back to their college community is a strategy of increasing interest nationally. The advantage to the city is obvious (based on talent and education). The advantage to the former student must be clearly defined. Typically, this involves business and professional opportunities, cost of living, and a sense of identity (a connection with the school, the community, and the values represented by the educational experience).

3A.1: Explore mechanisms for re-capturing Carleton and St. Olaf alumni. For reasons mentioned earlier (lack of graduate education, employment base, high housing costs) Northfield may not be in a position to meet the needs of many St. Olaf and Carleton students immediately following graduation. However, at other points in their personal and professional development, Northfield may be an attractive location for alumni.

Actions:

Increase connection with current and former students. Engaging current students at St. Olaf and Carleton Colleges in Northfield life should be a priority of any talent-related strategies. In addition to economic returns to be gained from better integrating students into the community, creating a positive experience for students will improve their perception of the city, increasing the likelihood they will remain in the area or return to the city later in life. Identifying creative approaches to re-capturing alumni from both institutions is also central to this strategy.

OPPORTUNITY 3: ATTRACTING AND RETAINING TALENT

comprehensive economic development plan:

“Carleton's hometown of Northfield—also home to the Malt-O-Meal factory—"isn't much to get excited about. Besides some quaint shops and great food, there's nothing to do." Carleton College profile

"Campus life is centered on campus, not in the town of Northfield," students say, because "while Northfield is an extremely nice town, we just don't get off campus much.” St. Olaf College profile

What Students Say About Campus Life from The Princeton Review

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Encourage St. Olaf and Carleton alums already in the community to assist in this effort.

Events. Ensure that relevant events are marketed to area alumni.

provide another channel for communicating with alumni. This could include paid advertising, but the city would be best served by drafting articles on topics of interest to the alumni. The focus of these articles would mirror that of the mail and e-mail campaigns outlined above.

Alumni publications. Alumni magazines (Carleton’s Voice and the alumni section of St. Olaf Magazine) and other publications can

•

projects that can engage students in the cultural, economic, and political fabric of the community (see box). The College Board of Business Consultants (CBBC) is one example of this concept. Through the CBBC students at both colleges are matched with area businesses and non-profit organizations to research and develop business strategies. Other approaches could include identifying public sector needs that would translate into class or individual projects, and working with existing internship programs at the colleges to identify public and private internship opportunities. These programs provide real-life experience for students, while filling a specific need for the community.

Projects. Work with professors at both institutions to identify

3A.2: Engage current students. One of the best strategies for recapturing alumni is to ensure that they have a positive experience during their stay in the community.

•

Specific examples include access to the Twin Cities, the advantage of cultural connections provided by the colleges (without the costs and disadvantages of a large city), and – most critically – the growing support for new business ventures (as demonstrated by the Northfield Enterprise Center and others).

OPPORTUNITY 3: ATTRACTING AND RETAINING TALENT

comprehensive economic development plan:

Katie Greller, St. Olaf College, Spring 2004

Taken from: Architecture of Community: Investigation of Architectural Elements and their effects on Northfield Neighborhoods

“I can say I hardly did this project justice, however, I feel the most important thing I’ve gained from this project is a sense of place here in Northfield. This town that I have lived in, but made little attempt to familiarize myself with, during the past four years, has suddenly become something I feel a connection with. This project has provided me with a reason to explore the physical, social, and historical aspects of this place, and has caused me to fall in love with this town. . . . I’m excited about being an active member of a community . . . not just living in a home but residing in a neighborhood with a commitment to my neighbors. This project has provided me with a reason to strive for a sense of community and I can only hope that it may have also sparked the interest of others.”

The following excerpt shows how a class project changed one St. Olaf student’s relationship to the community:

the ties that bind

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Strategy 3B:

Events. Ensure that relevant events are marketed to the colleges. Work with outreach coordinators at each facility to develop events or refocus existing events to better engage this group when possible.

Carleton. In addition to engaging the students, the city as a whole receives an economic benefit from volunteer services. The city can support the colleges’ programs —Carleton’s Acting in the Community Together (ACT) and St Olaf’s Volunteer Network — by helping to link them with the needs of local organizations.

Volunteerism. Support volunteer programs at St. Olaf and

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use of the old Northfield Middle School presents an excellent opportunity for collaboration. In addition to providing a possible venue for cultural events, this site should be investigated as a potential location to support media and arts-related entrepreneurship. The EDA should stay abreast of plans for the Old Middle School and support Carleton by promoting the site to appropriate prospects.

Old Middle School. Carleton’s recent proposal regarding the re-

3B.1: Encourage joint participation. In addition to cross-representation on relevant boards and commissions, this task should identify opportunities for partnerships between the colleges and the city. Two significant examples for joint participation include:

Actions:

Continue to engage leadership of colleges in economic development. Higher education institutions are becoming a pivotal piece of the economic development puzzle. The EDA should explore ways to enhance the relationship of the city and the colleges and continue to improve the flow of information between the leadership of these groups.

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OPPORTUNITY 3: ATTRACTING AND RETAINING TALENT

comprehensive economic development plan: NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Strategy 3C:

Healthcare complex. Northfield Hospital’s interest in becoming a regional medical destination, coupled with increasing ties between the colleges, the hospital, and regional health-related initiatives presents an excellent opportunity for joint participation. The city’s previous development proposal regarding St. Olaf-owned property should be reconsidered. This action is related to the larger question of the preservation of industrial land and represents one option for development as outlined in Strategy 1A.

enfranchising businesses in the broader goals of the community and the college(s), especially as they relate to innovative practices and training, and defining a “stewardship” role for colleges.

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Increase the range of housing options. Residential demand continues to drive up housing costs in the area. While housing is affordable relative to other places in the country, costs are high relative to other parts of the state,

There is no doubt that business opportunities for alumni must drive these strategies. It is also true that the targeted sectors provide the best means by which the “talent pool” can be drawn back to Northfield.

ensuring that entrepreneurial strategies are part of the economic development mix,

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3B.2: Explore best practices for economic development and higher education. The recently published Tools and Insights for Universities Called to Regional Stewardship provides guidance on this recommendation (available for download at: http://www.regionalstewardship.org). This document and related works are notably weak on specific strategies. They are, however, strong on case studies. The critical elements include the following:

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OPPORTUNITY 3: ATTRACTING AND RETAINING TALENT

comprehensive economic development plan: NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

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interviews, the EDA should include a question on housing issues (i.e., range of options and availability) as part of any business retention and expansion surveys.

Interviews. This effort should begin with interviews of the city’s major employers (see box). Based on the results of these

3C.2: Work with major employers to document scope of housing issue. Clarifying the scope of the problem, through business interviews or focus groups, is an important area where the EDA could contribute to HRA efforts.

that impacts business development. The EDA could serve as a liaison between the HRA and local businesses. One method for accomplishing this goal is to incorporate housing questions within business surveys or on-site visitations (see Strategy 3C.2).

• Business liaison. The availability of affordable housing is an area

goals to ensure that efforts do not conflict.

• Joint planning. The EDA and HRA should coordinate work plans and

3C.1: Support current programs. Northfield’s Housing and Redevelopment Authority (HRA) has a number of housing programs designed to improve the city’s housing situation, including down-payment assistance for first-time homebuyers and collaborative programs with the Cannon River Community Land Trust. Ensuring the continuation and expansion of these programs is important to the city’s future vitality. The EDA could support the work of the HRA in the following ways:

Actions:

including the Twin Cities. This issue affects a number of economic activities from recruiting college faculty and local executives to attracting and retaining young professionals.

OPPORTUNITY 3: ATTRACTING AND RETAINING TALENT

comprehensive economic development plan:

However, regardless of the term applied, the goal remains the same— improving the range of housing options for current and future residents.

inclusionary housing

attainable housing

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workforce housing

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Negative connotations associated with the term “affordable housing” have led practitioners to devise a number of terms, such as:

what’s in a name

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

accessing all available programs related to the provision of workforce housing. Examples of state-level initiatives in this area include the Economic Development & Housing Challenge Fund program and the designation of Workforce Housing Districts.

Explore related programs. Ensure that the city of Northfield is

a major issue by employers, the EDA and HRA should explore the feasibility of encouraging employer-assisted housing (EAH) programs. This term encompasses employer-led initiatives ranging from forgivable loans or grants to defray down-payment costs to "soft" (subsidized) second mortgages, matched savings program, below-market-interest-rate mortgages, and mortgage guarantees. Home-buyer education is another important aspect of the program. EAH programs have become popular with governments as a means for providing housing for public employees, such as teachers, police officers, and firefighters. The Greater Minnesota Housing Fund (http://www.gmhf.com) has facilitated a number of such programs in the state.

Employer-assisted housing (EAH). If affordable housing is seen as

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encourage developers to build affordable ownership and rental housing. For every affordable unit that a developer promises to build he or she can build a calculated number of market rate units greater than would be allowed otherwise. For example, a developer proposes to build rental housing on a site with zoning

Density bonuses. A density bonus program provides incentives to

3C.3: Work with the HRA to identify additional programs. The provision of “adequate and affordable housing” for Northfield residents is the charge of the HRA. However, the relationship of the HRA’s work to the future economic vitality of the city argues for EDA support of this function. Gaining an understanding of “best practices” in affordable housing that can be adopted in Northfield is another area where EDA involvement may make sense. Examples include:

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OPPORTUNITY 3: ATTRACTING AND RETAINING TALENT

comprehensive economic development plan:

450

Flexible Circuits

News Publishing

120

Retail Skilled Nursing Care Facility

108

114

125

140

175 161

180

198

340

400

Special Education

Grocery Distribution General Medical & Surgical Hospital Medical Care Skilled Nursing Care Facility Retail Government Window Glass Insulation

500

Education

787

860

650

Employees

Products/ Services Education Food Processing (cereal) Education

Sources: Northfield Area Chamber of Commerce; City of Northfield

Laura Baker Services Association Target Northfield Retirement Center Mainstream Publications L.L.C.

Cardinal CG

Allina Medical Clinic Three Links Care Center Cub Foods City of Northfield

Northfield Hospital

McLane Minnesota

Carleton College Northfield School District ISD #659 Multek Flexible Circuits, Inc.

Malt-O-Meal Company

St. Olaf College

Employer

Northfield’s Major Employers (100+ employees)

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

•

housing construction to include a certain percentage (typically between 10% and 30%) of affordable housing units as a part of

Inclusionary zoning. Inclusionary zoning ordinances require new

both single-family and multifamily housing needs. There are several multifamily housing programs, most offered to nonprofit developers, that either grant funds or provide long-term forgivable loans for affordable housing development.

Multifamily housing programs. Affordable housing should address

uses a real estate transfer tax to help create a fund for the development of workforce housing. A 1% fee of any real estate transfer over $100,000 is paid by the grantee at the time of transfer and is deposited into a fund to support workforce housing. The HRA should investigate whether this type of approach can be implemented in Northfield.

Real estate transfer tax. Another useful tool is a program that

A density bonus can take many forms. For example, a jurisdiction can allow for an increase in height or an increase in FAR if a developer includes affordable housing within a development project. The allowance for an increase in density can also be shifted from one part of the site plan to another and in some cases to a different site.

that allows a maximum of 30 rental units. However, if the developer promises that 10 of those units will be affordable to households at or below 50% of median income then instead of a maximum of 30 units the developer can build 35 units. Limits can be placed on both the zones where density incentives can be earned as well as a limit on the number of density bonuses allowed. Density bonuses can also be provided for other public benefits: open space, trails and parks; historic preservation; and energy conservation.

OPPORTUNITY 3: ATTRACTING AND RETAINING TALENT

comprehensive economic development plan: NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Strategy 3D:

Fannie Mae’s website [http://www.fanniemae.com/] includes a number of tools for making home ownership affordable, such as its 2005 Housing Solutions report.

Other.

Create entrepreneurial and innovative start-up opportunities. Innovation and entrepreneurship are a vital part of a vigorous economy. However, this fact does not mean that entrepreneurship can be easily captured in smaller and less developed areas or that every city or region can be successful in encouraging innovation. It is true, however, that the communities and regions

3C.4: Review existing ordinances. Several obstacles to developing affordable housing can be addressed by a review of the existing development process. Make sure that permitting and site plan review can be done in a timely fashion to meet lending requirements. Time added to the approval process typically translates directly into higher costs for the developer which are often passed along to the buyer. The Model Zoning Technical Advisory Group report published by the Minnesota Housing Finance Agency in 2003 provides some guidance in this area.

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The Minnesota Housing Finance Agency studied the issue of inclusionary zoning in a 2002 report to the legislature. The report concludes that local governments in Minnesota “have the authority in their general powers to control the use of land and to require inclusionary housing as a part of the decisions they make about growth and land use.” The report provides a case study of the “Clover Ridge” development in Chaska, MN.

the development. These units are eligible to be purchased or rented by families that do not exceed certain income levels. In many cases, a family selling a house purchased through the program must pass along the benefit to the new eligible buyer. This practice encourages a mix of "affordable" and "market-rate" housing in the same neighborhood.

OPPORTUNITY 3: ATTRACTING AND RETAINING TALENT

comprehensive economic development plan: NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

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Reduce the cost of doing business during a phase in which expenses exceed revenues. This includes reduced lease space

Looked at more broadly, an incubator should accomplish the following:

3D.1: Form virtual incubator. Form a “virtual incubator” in conjunction with the Northfield Enterprise Center, the colleges, and major employers. Unfortunately, incubators have become something of a cliché. The idea that a building with shared services will help new businesses become successful is no longer credible (if it ever was). Successful incubators are those with businesses that share common goals and are supported by some form of proprietary research or dedicated intellectual property. Without that, they too often resemble nothing more than a bad real estate deal.

Actions:

Excellent examples for an entrepreneurial approach are found in local companies such as Speech Gear, Monster Games, and (formerly) VIA and Gear Works. They represent an appreciation of the value of intellectual property that is at the heart of innovation and entrepreneurship. In fact, IP is the single best differentiator of entrepreneurial businesses from small business start-ups. This extends into niche market such as Astral Technologies and All Flex.

Northfield has unusual advantages in this regard. While most smaller communities have neither a strong corporate base nor significant educational resources, Northfield has both. The presence of these elements provides a basis for success in promoting the community internally as well as externally with regard to entrepreneurship.

that have taken this approach—linking educational resources with capital and creativity—consistently exceed the economic performance of other areas.

OPPORTUNITY 3: ATTRACTING AND RETAINING TALENT

comprehensive economic development plan:

It does include processes and systems, as well as new products. It draws on intellectual and management capital as certainly as it does on financial resources. It is pragmatic and forwardlooking. It is associated with the R&D departments of corporation and university researchers. It requires a relentless commitment to market realities and a critical eye for technological breakthroughs.

Entrepreneurship is the process of bringing innovations to the marketplace. This definition precludes the traditional “mom and pop” service business, as well as the garage inventor who gives no thought to whether there is a marketable product.

definition: ENTREPRENEURSHIP

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Creating synergy with related businesses through shared technology, marketing capacity, and shared talent pool

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3D.3: Engage higher education in this strategy. The EDA’s relationship with St. Olaf, Carleton, and other regional institutions of higher

3D.2: Expand use of the capital investment fund. Although the NEC has created a capital investment fund focused on large real estate transactions, Northfield must remain focused on the real goal: to support new business creation. Other ways to achieve that goal (from the perspective of reducing operating costs) include write-downs and creative leasing arrangements for existing office and industrial space. Specifically, designating certain buildings (especially in the downtown) as viable technology service-oriented start-up centers is a first step. Improvements to these buildings would include broadband access and flexible work spaces. Lease rates would be adjusted based on revenue. To avail themselves of these favorable rates, businesses would be required to participate in entrepreneurial seminars and work sessions.

The value of these services does not depend on a shared building. Networked systems, joint events, and off-site counseling can easily be provided. In fact, they are already largely in place. The Northfield Enterprise Center already offers SBDC-certified new and emerging business consultation. E-mails between like-minded researchers and entrepreneurs are a given in today’s wired economy. The value of a “virtual incubator” is precisely in not having to be dependent on a specific real estate investment.

Consolidating business support activities including counseling and technical assistance

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and administrative costs, as well as shared equipment (office and, potentially, machinery)

OPPORTUNITY 3: ATTRACTING AND RETAINING TALENT

comprehensive economic development plan:

St. Olaf website

Nearly $36,000 was awarded in 2004 for seventeen ventures. Since its inception, the Finstad Office has presented more than $500,000 to 180 students, for ventures ranging from organic farming to music marketing.

Since 1992, the Finstad Office for Entrepreneurial Studies has helped St. Olaf students gain real world experience by providing grants to promising entrepreneurs. Each spring, students pitch their business plans to a committee of businesspeople and St. Olaf faculty, who then select the entries that will receive funding.

entrepreneurial resource

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

3D.5

Working with the colleges to conduct an analysis of small business opportunities in Northfield that can be linked with entrepreneurial training.

Exploring opportunities for entrepreneurial development related to the colleges’ existing fiber network (See Strategy 1E).

Exploring real estate options described in Strategy 3D.2.

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Leverage state and federal funding. Federal grants that support innovation and assist private companies in securing government contracts have been integral to the success of many communities. This effort could begin by working with local industry groups to determine ways to address technology issues within their industry. Small Business Innovation Research awards (SBIRs) should be a staple for entrepreneurial activity: http://www.sba.gov/sbir/. While this strategy is admittedly more central to the success of places like Austin, Silicon Valley, and the Research Triangle, these awards are not out-of-reach for Northfield companies. A search of SBIR awards reveals four companies that have been successful in obtaining SBIR funding: The Flexible PC Co. (1996-1997); Astral Technology (19971999); VIA, Inc. (1998-2000); and SpeechGear (2001-2003). Other possibilities could be identified via the Catalog of Federal Domestic

Inventorying small business development and entrepreneurial programs in the area.

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3D.4: Create an innovation and entrepreneurship task force. This task force could be charged with addressing specific tasks, including:

education is central to creating an entrepreneurial climate. It is through these institutions that the most successful elements of entrepreneurship can emerge. These include an emphasis on existing industry and the ability to take classroom experience and turn it into a viable business model. The Finstad Office for Entrepreneurial Studies at St. Olaf’s should serve as a resource in this effort.

OPPORTUNITY 3: ATTRACTING AND RETAINING TALENT

comprehensive economic development plan: NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Strategy 3E:

Take steps to integrate city’s growing Hispanic/Latino population. In 1990, less than 200 residents reported their ethnicity as Hispanic or Latino. This figure jumped to nearly 1,000 just ten years later. While this group accounted for slightly less than 6 percent of the city’s total population in 2000, it represented roughly one-third of the total population gain from 1990 to 2000. If this trend continues, integrating this segment into the city’s economic, cultural, and political fabric will be critical to Northfield’s future.

3D.7: Provide stipends to promising engineers and students in the region. These individuals should be recruited from the Twin Cities region. This effort should be reviewed on an annual basis and if sufficient applicants are not available, the recruitment effort could extend statewide or even nationwide. These stipends should be linked to work carried out in the region. They are, in effect, mini-scholarships that can act as a catalyst for new business development. Funding for this effort should come from existing corporations and, on a limited basis, from the colleges.

The recommended task force would meet with major employers and the colleges to create a formal design competition. Small financial prizes would be awarded. A state-wide promotional effort (inviting venture capital firms to participate) should be included.

3D.6: Host design competitions underwritten by local companies. The ability to enhance existing products is a key element in support of “upstream technologies.” This enhancement is often design-related. A competition which engages students, engineers, and industrial designers to show how products can be improved can be of immediate value to the companies participating, as well as to those submitting their work.

Assistance (CFDA) published on-line by the U.S. General Services Administration (http://www.gsa.gov/).

OPPORTUNITY 3: ATTRACTING AND RETAINING TALENT

comprehensive economic development plan:

This question is more difficult to answer. There are indicators, however, that are worth attending to. In Northfield, as elsewhere, Hispanics are under-represented on city councils and other civic institutions. Hispanic drop-out rates, housing quality, and income typically compare poorly to those of the population as a whole.

Regardless of the trend data, is the Hispanic population fully involved in the social and economic development of the community?

National trends show continued growth of the Hispanic population throughout the United States. There is every reason to expect that Northfield will be no exception to this trend. Mexican workers – both legal and illegal – continue to have easy access to U.S. cities, where their services are welcome.

Does this growth represent a long term trend, or were the 1990s an anomaly?

[continued next page]

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Northfield’s growing Hispanic/Latino population raises many questions for community leaders:

why it matters

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

3E.2:

3E.1:

Actions:

Needs. The second prong would entail surveying the population to identify issues or challenges faced by this ethnic group. This could be accomplished through a formal written survey or via focus groups or incorporated into other administrative processes.

characteristics of the population. This would include a more detailed analysis of 2000 Census data for this group, as well as identifying sources of more current data (such as estimates or projections available through state or federal population programs).

Characteristics. The first prong consists of documenting the size and

(2003) by the Minnesota League of Cities provides additional information on this issue.

Building Inclusive Communities: An Action Guide for City Leaders

Address systemic issues most closely tied to economic development. Once a better understanding of the needs and perceptions of Northfield’s Hispanic/Latino population has been obtained, the EDA should work with the city and others to address those issues most closely related to economic development. Emphasis should be given to facilitating small business opportunities. This is often an important step in integrating new immigrants into the population. The retail strategy outlined under 2B of this plan should reflect an understanding of the needs of this population, both from a small business standpoint and a market standpoint

•

Increase understanding of the Hispanic/Latino population. Working with community development organizations (such as the Northfield Community Action Center, Three Rivers Community Action, and the Rice County Social Services office) to document Northfield’s Hispanic/Latino population is an important first step in this strategy. This effort should be two-pronged.

OPPORTUNITY 3: ATTRACTING AND RETAINING TALENT

comprehensive economic development plan:

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In this context then, what are the appropriate economic development actions that should be part of the strategic plan? We are mindful of the fact that many social issues, whether they relate to minority populations, the elderly, or children, already have advocates and programs on their behalf. Moreover, an economic development plan becomes diluted when it seeks to tackle the root problems of low educational attainment, affordable housing, and other issues that are not in its immediate purview. Despite these caveats, a concerted outreach driven by shared economic objectives is included in the action items.

Are there strategies that can make a difference, in measurable ways, to the economic vitality of the city?

If a growing segment of the population is less educated, less engaged, and (consequently) less productive than it could be, this has serious negative consequences. Aside from the direct effects on businesses, a less productive worker costs the city more in social services and the lower purchasing power of a minimum wage worker. In short, if it is not already accepted as a pressing social issue, it is clearly an economic issue and deserves the city’s full attention.

Are there factors in the growth of the Hispanic population that require an economic development response?

why it matters [continued]

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

view of economic development. We remain sensitive, however, to the primary purpose of economic development: to generate interest from companies with expansion or relocation plans. Towards that end, we have prepared a list of target industries for the City of Northfield.

The challenges and actions set forth in this plan take a broad

Other sectors may be viable targets despite relatively low employment concentrations because they represent opportunities that have not yet been tapped. In other words, sectors that are underrepresented in a region suggest that there may be room for growth. Naturally, there are exceptions. These may involve the competitive challenge posed by neighboring communities or by the Twin Cities. Professional and technical services are one example. Northfield has a much lower concentration of employment in this sector than would be expected based on national

A review of Northfield’s employment location quotients reveals that the city’s economic base is more diversified than most communities of its size, with concentrations in manufacturing, education, and health services (see box at right and graphic on next page). These core industries represent the first tier of economic opportunity. This is due to the fact that the community typically already has the necessary components in place (including workforce and infrastructure) to begin effective targeting of the industry. Northfield’s concentration of employment in these sectors suggests a competitive advantage that could be exploited by targeting additional expansion and recruitment of firms in these areas.

Our approach to identifying industries that provide the greatest potential for success begins with the economic assessment. This assessment (published under separate cover) analyzed demographic and economic factors affecting the region. Our understanding of Northfield’s strengths and potential opportunities was then filtered by our knowledge of economic development trends at the global, national, and regional level. These trends include the continued downsizing and off-shoring of traditional manufacturing jobs, continued growth of the service sector, and the approaching deficit of workers in the U.S.

Despite the considerable time, money, and people dedicated to a community’s financial well-being, industry recruitment remains the linchpin for economic development. Choosing the appropriate target industries can make or break a plan.

TARGET INDUSTRIES

comprehensive economic development plan:

If the local industry and national industry are perfectly proportional, the location quotient will be 1.0. If an industry is heavily concentrated at the local level (e.g., automotive industry in Detroit, technology in Silicon Valley, gambling in Las Vegas), then the location quotient will be higher than 1.0. Conversely, if the industry is sparsely concentrated at the local level (e.g., farming in New York City, convention tourism in North Dakota), the location quotient will be lower than 1.0.

Local jobs in industry/ Total local jobs LQ = ————————————— U.S. jobs in industry/ Total U.S. jobs

A location quotient (LQ) is calculated as a local industry’s share of total local employment divided by the same industry’s share of employment at the national level:

definition: LOCATION QUOTIENTS

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Logistics Specialty manufacturing Environmental technologies Healthcare/medical Professional/technical services Information technology

0.91

Public Administration

0.28

0.38

0.40 0.39

Real Estate & Rental & Leasing

0.50

Construction Information

0.64 0.62

Arts, Entertainment, & Recreation

2.00

3.00

Above Average

3.40

3.50

1.00 = National Average

2.50

4.00

Source: Minnesota Department of Employment Security, QCEW series 2004

Below Average

0.82

Other Services, Ex. Public Admin Retail Trade

0.94

1.52

Average

1.22 1.04 0.95

Accommodation & Food Services

Average of Service-Providing Sectors

Health Care & Social Assistance

Average of Goods-Producing Sectors

Manufacturing

Educational Services

A summary of the targets is presented on the pages 63 to 64. Professional & Technical Services Additional detail for each industry is provided on the following Finance & Insurance pages. This information includes a brief description of the Agriculture, Forestry, Fishing & Hunting industry, including the applicable codes under the North American Industrial Classification System, or NAICS (pronounced “naykes”). This system was designed to organize industries by function for administrative purposes. It replaces the Standard Industrial Classification (SIC) system. Under the NAICS framework, industries are classified according to 20 major sectors:

The following list presents Northfield with immediate opportunities for economic growth. It is also designed to withstand the fundamental shift in the nation’s economy toward consumer services.

1.50

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Clearly, economic development can no longer be thought of as simply a competition for recruiting industrial employers. The future of a community or a region also lies in its ability to retain and attract workers and their families. In light of this, economic development practitioners must encourage opportunities with roots in nontraditional sectors that highlight quality of place. Communities Location Quotients for Northfield Selected Two-Digit NAICS Sectors must ensure their survival in the war for talent. Our list of target sectors was expanded to reflect this thinking. 0.00 0.50 1.00

patterns. Because this sector is an important source of high wage jobs and provides support services to manufacturing and other industry sectors, it represents a desirable target for additional employment.

TARGET INDUSTRIES

comprehensive economic development plan:

NAICS Sector Agriculture, Forestry, Fishing and Hunting Mining Utilities Construction Manufacturing Wholesale Trade Retail Trade Transportation and Warehousing Information Finance and Insurance Real Estate and Rental and Leasing Professional, Scientific, and Technical Services Management of Companies and Enterprises Administrative and Support and Waste Management and Remediation Services Education Services Health Care and Social Assistance Arts, Entertainment, and Recreation Accommodation and Food Services Other Services (except Public Administration) Public Administration

U.S. Industry 513321: Paging

Industry 51332: Wireless Tele:communications Carriers (except satellites)

Industry Group 5133: Telecommunications

Subsector 513: Broadcasting and Telecommunications

Sector 51: Information

These 2-digit classifications are further broken down as illustrated in the following example

Code 11 21 22 23 31-33 42 44-45 48-49 51 52 53 54 55 56 61 62 71 72 81 92

TARGET INDUSTRIES

comprehensive economic development plan: NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Logistics firms generally consume large tracts of land. Also can be downside to some aspects of logistics (e.g., truck traffic, truck-oriented businesses).

Considerations

Twin Cities competition, access to patents and other proprietary manufacturing processes, workforce retention, pressures of off-shore and out-sourcing by major customers, emphasis on quick turn-around and market feedback

Focus on firms dominating a niche; relationship to production-based manufacturers; connection with technical applications; access to national and global markets

provides a pool of companies and workers. Links to engineering and designbased product approach.

firms (e.g., McLane, Taylor Trucking, and College City Beverage), as well as prospect inquiries suggests competitive advantage. Transportation network (I–35 and Hwy 52) provide access to major markets in all directions.

Emphasis should be given to firms using sophisticated supply chain management technologies. Inter-modal capacity is beneficial. Reverse logistics represents a growing segment of the industry.

City’s existing manufacturing base

Presence of other logistics-oriented

Rationale

Priority sector

Various firms requiring IT capacity for manufacturing and paying above average wages for technical skills. Markets are specialized and emphasis is on design over production.

SPECIALTY MANUFACTURING

Firms involved in moving goods from producer to consumer in the most efficient manner. More sophisticated than warehousing and trucking activities of the past.

LOGISTICS

AT A GLANCE

Skill sets in materials design and IT are critical to green buildings. Wind power requires extensive land for placement. Current design and manufacturing is conducted in Europe, with limited opportunity in the U.S.

Green building and wind power are on the verge of becoming established industries. The construction industry draws upon a wide variety of individual companies, ranging from materials to smart building systems.

companies in this area and progressive policies. Both Carleton and St. Olaf have sustainability-related programs.

Minnesota has a strong base of

industry are positive nationwide.

Long-term growth trends for the

Products and processes which are environmentally beneficial or benign. A wide range of industries is often encompassed under this heading, including renewable energy, sustainable building products, pollution control equipment, waste management, and remediation services.

ENVIRONMENTAL TECHNOLOGIES

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Description

target industries:

TARGET INDUSTRIES

comprehensive economic development plan:

Activities covered under this target range from direct patient care to diagnostic services to medical research.

Proximity to Twin Cities, University of Minnesota Medical School, and Mayo Clinic. Presence of key healthcare/medical employers in the region (e.g., Medtronic) and strength of St Olaf’s science and math programs suggests there is a pool of workers in the area.

Medical research opportunities connected to college graduates (St. Olaf) and regional organizations (e.g., MN Partnership for Biotechnology and Medical Genomics).

Lack of existing cluster; positioning of state of Minnesota; relationship to regional health care

Rationale

Priority sector

Considerations

MEDICAL/HEALTHCARE

AT A GLANCE

Description

target industries:

TARGET INDUSTRIES

PROFESSIONAL & TECHNICAL SERVICES

Proximity to Twin Cities. Low LQ (0.38) suggests some regional disadvantage, but more likely reflection of city’s growth curve.

Opportunity to go “upstream” from existing employers (e.g., testing and R&D activities). Also micro-suite workspaces targeted toward spouses of college staff.

Proximity to Twin Cities, perception of cultural, recreational, and economic opportunities available for younger workers. Low LQ (0.50) suggests some regional disadvantage, but also room for growth in the sector.

Potential for digital and media arts activities related to colleges (particularly Carleton)

Strong pool of educated workers and major employers creates base for support of these industries. Presence of colleges. Minimal land use needs.

Includes firms that produce, transmit, or process data. Examples include publishing, software, broadcasting

INFORMATION

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Strong pool of educated workers and major employers creates base for support of these industries. Presence of colleges. Minimal land use needs.

Includes a variety of occupations: attorneys, accountants, marketing and advertising, architects and engineers, testing and R&D.

comprehensive economic development plan:

Priority sector Within the logistics and distribution sector, Northfield should focus on firms using the most sophisticated supply chain management technologies. Supply chain management (SCM) companies oversee the flow of materials, information, and finished goods as they move from supplier to manufacturer to retailer and final consumer. These companies typically have a large

With the decline of manufacturing jobs nationwide, logistics has become an attractive target for many communities because it provides some of the advantages once inherent in manufacturing employment. Most notable among these is the presence of well-defined skill ladders with opportunities for advancement based on experience and on-the-job learning. The industry’s ability to provide relatively good paying jobs for unskilled workers, coupled with the city’s locational advantages makes logistics a logical target for Northfield.

Rationale Despite its distance from Interstate 35, Northfield is home to McLane Minnesota, a division of one of the country’s leadings logistics operations. Other distribution-related companies in the area include Taylor Trucking and College City Beverages. In addition to these existing businesses, the city continues to attract interest from logistics firms. Highway 52 has been cited as a competitive advantage for distribution activities in Northfield. It creates a link to Interstates 90 and 94, allowing local companies to serve other Midwestern markets, including Chicago and Milwaukee.

Description Once known as “warehousing and distribution,” the process of moving goods to market has evolved significantly in recent years. What was once a matter of simply storing large quantities of goods and shipping them in bulk (when end-users placed orders) is now an increasingly sophisticated science. This process seeks to minimize inventories and respond to the growing demand for next-day – or even several-times-a-day – delivery. Competitive shifts within the industry have been accelerated by global trade, containerization and standardized packaging, just-in-time (JIT) inventory management, outsourcing of delivery services, and increased technological capabilities.

NAICS Codes: 4841, 4842, 4931

Logistics

TARGET INDUSTRIES

comprehensive economic development plan:

The US has trailed other developed countries in requiring manufacturers to take responsibility for their product throughout its life cycle, sometimes referred to as managing products from “cradle to grave.” However, as companies face rising production costs and growing pressure from consumers to employ more environmentally friendly practices, the concept of product lifecycle management will gain ground.

Like traditional, “forward” logistics activities, reverse logistics can be handled by the manufacturer or by third-party firms. Services provided by reverse logistics firms can include repair and warranty services, and product reclamation and recycling. Other related practices include reusable transport packaging.

Reverse logistics is an increasingly important segment of logistics and distribution activities. Reverse logistics focuses on the movement and management of products and resources after the sale and after delivery to the customer. The concept includes product returns for repair and/or credit, as well as the growing trend towards re-manufacturing and recycling.

niche opportunity: REVERSE LOGISTICS

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Considerations Logistics firms generally consume large tracts of land, which limits the city’s ability to accommodate these operations. While requirements vary widely, a minimum lot size of 50 acres is not unusual, due to the size of facilities (buildings can range from 250,000 to well over 1 million square feet), as well as the need for parking and traffic circulation within the site. In addition, increased truck traffic and an influx of truck-oriented businesses (truck stops), can have a negative effect on the image of a community. Northfield’s distance from I-35 may help to minimize this aspect, as truck-related businesses would be more likely to cluster along the interstate.

Finally, the ability of a firm to anticipate trans-shipment of goods and the relationship to intermodal capacity is especially important in targeting specific companies.

E-commerce fulfillment centers are another aspect of logistics that is growing rapidly. These firms provide distribution-related functions for goods purchased via the Internet by consumers and/or businesses, providing a cost-effective means for “unit of one” shipping to consumers who make purchases online.

Logistics operations can be a subsidiary of a larger company or an independent, third-party operator. Third-party logistics, or 3PL, is a growing segment of the logistics industry. 3PL firms provide a variety of services, including assembling and repackaging materials, consolidating orders and shipments, and physically delivering goods to customers. 3PLs typically serve a number of clients from a single facility.

information technology component designed to enhance inventory control and just-in-time manufacturing to help control costs. Specialized logistics software and inventory control systems, such as radio frequency identification (RFID), are becoming standard tools within the industry. Depending on the industry or client base, SCM firms may offer more specialized services, such as multi-temperature warehousing or certified food-grade facilities or reverse logistics (see box, previous page).

Logistics (cont.)

TARGET INDUSTRIES

comprehensive economic development plan: NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Priority sector Focus on firms with a niche relationship to food processing, medical R&D and other technical applications. Since these companies do not occupy a convenient NAICS category, more emphasis will need to be placed on establishing a formal database of prospects.

The potential to provide ultra high-speed Internet connectivity could be attractive to companies in this sector, as they frequently need to transmit large files.

A good example of a company that could fit this profile is Northfield Foundry & Machine. While they may not fit the target directly, they contain the skilled labor and technical resources to expand into new markets and provide technical and professional services. Variations on the company’s automatic stackers can serve as prototypes for a wide range of additional applications.

Rationale Northfield’s strong manufacturing base, with a large pool of companies and workers, as well as proximity to the Twin Cities, make this a logical and desirable target. Testing and R&D are integral to this target, so it is logical to begin by looking at those specific needs in relationship to existing manufacturers (Malt-o-Meal in particular).

Companies that fit this profile are typically small (under 100 employees), have existing relationships with major manufacturing companies, and are able to provide quick through-put on engineering assistance.

Description In large part, this target can be described as “non-manufacturing” manufacturing. This target identifies firms less interested in production than in limited series or prototype activity. The companies typically require significant IT capacity and technically skilled labor. They provide testing, R&D, and engineering expertise to production companies and offer consulting services as part of their manufacturing capacity.

NAICS Codes: various, including 3327, 3329

Specialty Manufacturing

TARGET INDUSTRIES

comprehensive economic development plan:

Because of their use of web-based ordering and their reliance on courier services, companies like Incodema are a fit for many communities.

Formed in 2000, the company has expanded rapidly and currently employs 50 people. Demand for rapid prototyping is expected to continue due to pressure on manufacturers to innovate while holding costs down.

A sophisticated web-based system allows customers to place orders, store the necessary drawings and documentation online, monitor the status of their projects and collaborate with Incodema engineers in realtime. Finished products, as well as most supplies, are moved via courier.

Incodema is a prototype and short run sheet metal stamping provider based in Ithaca, New York. The company uses state-of-the-art technology to produce high quality prototype sheet metal stampings and intricate metal formings in five business days or less. This represents a fraction of the time required using conventional processes.

case study: INCODEMA, INC.

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Workforce. A technically skilled workforce is essential for this sector. This need can

•

Access to patents and other proprietary manufacturing processes. Suitable targets have intellectual property and specialized capabilities that distinguish them from traditional manufacturing firms. Since “contract manufacturing” partially encompasses this target, it is important to make the IP distinction in seeking suitable companies.

•

out-sourcing by customers is a major factor in addressing this concern. Companies that can ensure quick and reliable feedback have a clear competitive advantage. This is often not the case with specialty manufacturers located in places like Taiwan or India.

Emphasis on quick turn-around and market feedback. The pressures of off-shore and

serve as a way of refining the target, but it also represents a potential barrier. If the company has employees unwilling to relocate, the EDA must ensure that there is adequate training capability in the region. The reference to training in the organizational recommendations is especially relevant.

Twin Cities competition. The EDA should develop a database of specialized manufacturing companies in the Twin Cities. This database can be used both as a recruitment target and (through interviews) as a way of determining the barriers to a Northfield location.

•

Considerations In order to make this a viable target, the following due diligence will be required before any marketing efforts:

Specialty Manufacturing (cont.)

TARGET INDUSTRIES

comprehensive economic development plan: NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

ET is an attractive target for Northfield for a number of reasons. First the region has an active environmental community including ReNew Northfield, the Northfield Biodiesel Buyers’ Club, the Southeastern Clean Energy Resource Team (Southeastern CERT), and the Cannon River

Rationale The market for environmental technologies (ET) is rapidly expanding worldwide. Growing concerns about sustainability, coupled with rising production costs, and increasingly complex regulations, have made ET an important concern for U.S. businesses and consumers. The U.S. ET industry produced $220 billion in revenues in 2002 supporting more than 1.6 million jobs. The United States is the largest, single market for ET in the world, and US companies and research centers are the source of some of the most innovative environmental technologies.

Remediation and restoration: Technologies used to render hazardous substances harmless.

enter the environment.

Pollution control: Technologies that render hazardous substances harmless before they

of pollutants.

Pollution avoidance: Equipment and processes used to prevent or minimize the generation

the environment.

Monitoring and assessment: Technologies used to establish and monitor the condition of

The ETI definition organizes environmental technologies into four major categories:

Description The International Trade Administration’s Office of Environmental Technologies Industries (ETI) defines environmental technologies as goods and services that “advance sustainable development by reducing risk, enhancing cost effectiveness, improving process efficiency, and creating products and processes that are environmentally beneficial or benign.” This sector includes: air, water, and soil pollution control; solid and toxic waste management; site remediation; and environmental monitoring and recycling.

NAICS Codes: 221119, 5413, 5416,5417, 5629

Environmental Technologies

TARGET INDUSTRIES

comprehensive economic development plan: NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

For Northfield to gain traction with this target, one of the following actions will have to occur: the recruitment of a company with national visibility in environmental technologies, an R&D initiative, funded by either the state or a federal agency, or aggressive promotion of existing and future demonstration projects.

Considerations Northfield has no research and development background and no existing cluster in these sectors. This is a significant barrier. Demonstration projects, both corporate and public, are helping set the standard for new building and energy approaches.

Priority sector The rapid expansion of green building technologies and wind power make these sectors especially viable. The presence of the colleges and the link (even on the undergraduate level) to research is a natural one. Demonstration projects are still widely sought after and it follows that Northfield’s ability to gain regional (or national) recognition for strength in these sectors depends on that. Northfield already has a number of demonstration projects related to wind power at various stages of completion. Carleton’s turbine is operational and St. Olaf’s is well into the planning stage. An additional turbine is under consideration by ReNEW Northfield, a local non-profit. Similar projects in the area of green building technologies would also be likely to attract interest in the region.

Watershed Partnership. Both colleges incorporate environmental and sustainability principles in their offerings Carleton College has National Network for Environmental Management Systems

Environmental Technologies (cont.)

TARGET INDUSTRIES

comprehensive economic development plan: NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Demographic trends also point to increasing needs for healthcare and medical services. As the baby boom generation approaches retirement age, a larger share of all consumer spending in the nation is being spent on healthcare related expenses. Northfield’s age structure is skewed by the presence of college students. However, the city’s baby boom and senior population grew at a much faster rate than the county or the state between 1990 and 2000. This fact, coupled with Northfield’s relatively high household income levels in Northfield ($49,972 was the median in 2000), point to a strong demand for healthcare and related services in the region in the future.

This growing reliance on healthcare employment holds true for Northfield. While education accounts for approximately a quarter of Northfield’s economic base (as measured through employment), recent indicators suggest that healthcare has exerted a greater influence on job growth in the community. Northfield is home to several healthcare related establishments, including Northfield Hospital, Allina Medical Clinic, and a number of nursing care facilities. Growth in the community’s medical community can be seen by recent, on-going, and planned expansions at Northfield Hospital.

Rationale National trends indicate continued expansion of healthcare and related industries. Access to healthcare is viewed as both a quality of life issue for residents and an economic issue for communities. The presence of healthcare facilities is seen as an important factor in location decisions for most industries. With the continued loss of manufacturing jobs, once the most critical driver in local economic development, communities are becoming increasing reliant on the healthcare industry as a source of employment and tax revenue.

Description This target covers a range of activities from direct patient care to diagnostic services and medical research. The sector includes many occupations that offer relatively high wages and abundant career-ladder opportunities. We recognize that the broadness of this sector complicates the targeting effort. Nevertheless, Northfield has the potential to tie traditional health care to more sophisticated research capability. Attracting medical and diagnostic labs in support of the hospital represents this connection (see box).

NAICS Codes: 62, 5417

Medical/Healthcare

TARGET INDUSTRIES

comprehensive economic development plan:

sciences (NAICS 5417102). Technically part of the professional & technical services sector, this industry (a subset of NAICS 5417) includes establishments primarily engaged in conducting research and experimental development in medicine, health, biology, botany, biotechnology, agriculture, fisheries, forests, pharmacy, and other life sciences including veterinary sciences.

• Research and development in the life

6215) comprises establishments primarily engaged in providing analytic or diagnostic services, including body fluid analysis and diagnostic imaging, generally to the medical profession or to the patient on referral from a health practitioner.

• Medical and diagnostic laboratories (NAICS

As in the professional and technical services sector, a focus on the upper end of the target is warranted.

DIAGNOSTIC LABORATORIES

niche opportunity: MEDICAL &

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Considerations From the standpoint of patient care, Northfield Hospital is working to extend its service area, raising Northfield’s profile as a regional medical destination. The hospital is also building partnerships with care providers in the region, including the Mayo Health System. In order to capitalize on these services from an economic development standpoint, research and education should be more integrated into the sector. A medical cluster gains momentum when it goes beyond patient care. Successful approaches integrate clinical research and related medical product development.

Priority sector Medical research opportunities connected to area universities and regional organizations (e.g., MN Partnership for Biotechnology and Medical Genomics) should be emphasized. Understanding the long-range plans of Northfield Hospital should also drive prioritization of the targets. Developing a network of primary care clinics is among the hospital’s highest priority, according to plans posted on the hospital’s website. Increasing the base of services available in the community will help to support this effort.

These factors, coupled with Northfield’s proximity to important players in the medical and healthcare arena — including the University of Minnesota Medical School, the Mayo Clinic, and private companies such as Medtronic — make medical and related industries a logical target for the city.

The strength of the science and math offerings at St. Olaf and Carleton also provides indirect support for this target. St. Olaf was first among baccalaureate colleges in mathematics, fifth in chemistry, and sixth in life sciences as an undergraduate supplier of Ph.D.s. The institution has received five consecutive grants from Howard Hughes Medical Institute. Carleton ranked first in the number of students receiving National Science Foundation Fellowships among primarily undergraduate institutions from 1996 through 1999 and has above-average acceptance of its graduates who go on to medical school. Seventy percent of Carleton alumni who apply to medical school and maintained a grade point average of 3.0 or higher while at Carleton are accepted; the national acceptance rate is 40 percent. Bringing these alumni back would be part of the strategy for recruiting companies in the healthcare and medical industries.

Medical/Healthcare (cont.)

TARGET INDUSTRIES

comprehensive economic development plan: NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Priority sector Within this sector, emphasis should be placed on targets that are “upstream” from existing employers. By “upstream” we are referring to those industries that focus on the value added to a product rather than on the product itself. One example is testing and research and development activities in support of major employers or key industries in the area, such as food processing. In

Northfield’s strong pool of educated workers and existing base of major employers makes this sector a logical choice. The presence of Carleton and St Olaf presents opportunities for growth due to a demand for services created by employees of the colleges and serves as a source of workers. Increasing employment opportunities in this sector also provides the community with options for the “trailing spouse” of college faculty and executives of local companies. The city’s growing base of design-related professionals (e.g., architects, graphic designers) also provides support for this target.

Rationale This sector, along with general business support services like document reproduction and data processing, is dramatically underrepresented in Northfield. In addition to providing a source of relatively high-wage employment, the presence of a well-rounded professional services sector is key to the retention of existing businesses and the recruitment of new industries of all types. Also, the growth of this sector, which is heavily dependent on Class A office space, creates an important opportunity for real estate development and redevelopment. Because office jobs typically require less space per worker than does manufacturing, office uses also consume significantly less land than industrial development.

Description The professional and technical services sector comprises establishments that specialize in performing professional, scientific, and technical activities for clients in a variety of industries and, in some cases, households. These activities require a high degree of expertise and training. Activities include professional occupations, such as legal services, accounting, marketing and public relations, as well as more specialized activities such as research and testing, engineering, and design.

NAICS Codes: 541, 5182

Professional & Technical Services

TARGET INDUSTRIES

comprehensive economic development plan:

research and development services (NAICS 5417) comprises establishments engaged in conducting original investigation undertaken on a systematic basis to gain new knowledge (research) and/or the application of research findings or other scientific knowledge for the creation of new or significantly improved products or processes (experimental development).

• Scientific

laboratories (NAICS 54138) comprises establishments primarily engaged in performing physical, chemical, and other analytical testing services, such as acoustics or vibration testing, assaying, biological testing (except medical and veterinary), calibration testing, electrical and electronic testing, geotechnical testing, mechanical testing, nondestructive testing, or thermal testing. The testing may occur in a laboratory or on-site.

• Testing

Minnesota’s strength in food processing, coupled with the presence of Malt-O-Meal, makes food testing a niche opportunity for Northfield. The strength of the science and math programs offered at the colleges, along with the growing number of medical and life sciences establishments in the Twin Cities suggests scientific research & development and testing laboratories as additional opportunities.

niche opportunity: RESEARCH & TESTING

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Northfield’s proximity to the Twin Cities is a double-edged sword. While it provides a major market for the services offered by firms in this category, it also creates competition for those firms from a site selection standpoint. Double-digit vacancy rates in the metropolitan office market, coupled with the presence of amenities typically sought by professionals, increases the challenge for Northfield. Furthermore, a location quotient of 0.38 implies some regional disadvantage. However, it suggests that there is room for additional growth in the sector.

Considerations With the exception of technical services, which typically follow a specific customer base, this industry cluster is driven largely by access to an educated workforce, proximity to a diverse customer base, and quality of life considerations. Other considerations include broadband access, availability of Class A office space, tech/flex space, and research and technology parks. For larger firms, high visibility or “prestige” development sites may be an issue.

Call centers and other “back office” activities represent an additional opportunity. However, emphasis (support and incentives) should be given to inbound operations, such as customer service functions, rather than outbound call centers, like telemarketing, which typically consist of lower wage jobs. College towns are often high on the list of call center companies due to the availability of a student workforce. Call center jobs are popular among many college students as they offer flexible scheduling and an office-like working environment. However, the academic rigor of St. Olaf and Carleton Colleges may limit the size of the student workforce that would be available.

addition to Malt-0-Meal, Minnesota is home to five of the country’s top 50 U.S. food producers according to a ranking of food sales in 2004 prepared by the Food Marketing Institute (September 2005): #11 General Mills (Minneapolis), #18 Cargill (Wayzata), #23 Hormel Foods (Austin, MN), #26 Land O’ Lakes (St. Paul), and #44 Schwan Foods (Marshall).

Professional & Technical Services (cont.)

TARGET INDUSTRIES

comprehensive economic development plan: NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Broadband access is also a factor for the IT sector. Northfield has a ring of Internet-2 (ultrabroadband fiber optic cable) that can be extended beyond the service provided to the colleges. This capacity can serve software and engineering companies – or any companies that require rapid transmission of large data packets.

Northfield offers several advantages to small or start-up firms in this sector. First, the pool of educated workers and existing businesses present a potential customer base for data processing services. The technological capabilities of the local colleges and the pool of students could provide a base for expansion of this sector. Like professional services, the land use requirements of this sector are typically lower than industrial uses.

Dissatisfaction with “offshoring” of information technology jobs to India and other emerging markets — stemming from a range of issues including language barriers, intellectual property protection, travel, time differences, political risks, infrastructure vulnerability, and increasingly high employee turnover — has led an increasing number of firms to consider “homeshoring” facilities in mid-size American cities and rural areas as a low-cost domestic alternative to both large US metro areas and remote offshore locations.

Rationale The presence of a well-developed information sector is critical to the development of other industries, as technology and information comprise an increasing share of the value of all products and services. This trend will only increase as technological advances continue to revolutionize both “high tech” and traditional industries alike.

Description This sector includes firms that transform information into a commodity that is produced and distributed by a number of growing industries. The main components of this sector are the publishing industries, including software publishing, the motion picture and sound recording industries, the broadcasting and telecommunications industries, and the information services and data processing industries. SpeechGear is local example of companies in this sector.

NAICS Codes: 51

Information

TARGET INDUSTRIES

comprehensive economic development plan:

• • • •

International Digital and Media Arts Association http://www.idmaa.org/

"information appliances") interactive television online role-playing games virtual reality distributed collaborations”

• ubiquitous computing ("smart houses",

assistants, cell phones)

• mobile computing (GPS, personal digital

The emerging field of digital media/digital arts consists of “the production of content for existing media such as the Internet, radio and TV, digital cinema and video, computer games, cinematic special effects and animation, as well as for emerging media such as:

DIGITAL ARTS

niche opportunity: DIGITAL MEDIA/

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Considerations Like the professional and technical services sector, competition from Minneapolis/St. Paul presents a significant challenge to this target. Many industries in the information sector are still dominated by younger workers for whom the Twin Cities are likely to hold a stronger appeal. The perception of opportunities available (cultural, recreational, and economic) for younger workers, coupled with Northfield’s higher housing costs, may limit the city’s ability to attract many of the cutting edge firms. However, entrepreneurs who are looking for an alternative to metropolitan living may find Northfield’s offerings preferable. As with professional services, the information sector’s low LQ (0.50) suggests some regional disadvantage, but also room for growth in the sector.

Ultra-broadband is especially valuable to the digital arts. These typically involve video and music transmission that benefit from high speed access.

Priority sector Digital media and digital arts have attracted interest in the community, fueled by events such as Carleton’s 2003 Digital Arts Festival. The strength of Carleton’s Cinema & Media Studies program, coupled with art and computing programs at both colleges, opens the door for a niche in this area.

Northfield’s growing strengths in design also provides an advantage in attracting companies and professionals in this sector. Design has become an increasingly important aspect of information technology. Productization and IT are increasingly integrated. This convergence translates into a variety of features that augment a core product. For this to occur, a company (and a community) must invest in and support design capability. This capability means technically-skilled workers and the equipment that allows them to be productive (ranging from CAD-CAM to scale-based prototyping.

Information (cont.)

TARGET INDUSTRIES

comprehensive economic development plan: NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

Actions

X X

EDA City EDA

Next 6 months

EDA

City

EDA

Lead Organization

6 to 12 months

Timeframe 1 to 2 years 2 to 5 years

Ongoing

$500

NA (excludes cost of land if city ownership option chosen)

$4,500 plus up to $100,000 if area plan is outsourced. Excludes land purchase, if any

Additional Budget

Legend: EDA = Northfield Economic Development Authority; City = Council, Boards, Commissions, and staff; HRA = Northfield Housing & Redevelopment Authority; Colleges = St. Olaf and Carleton Colleges: NCC = Northfield Chamber of Commerce; NDDC= Northfield Downtown Development Corporation; NEC = Northfield Enterprise Center

1A.1: Update information on preferred sites: 1) property surrounding Northfield Hospital, including lands owned by St. Olaf, and 2) area west of existing industrial area (see map, p. 12). • Assemble/update information on number of parcels, ownership, and current asking price (if applicable) • Land use classification. Ensure that land is properly classified. Take action to annex and re-zone if necessary • Infrastructure. Determine status of infrastructure and transportation-related improvements. • JOBZ designation. Determine if sites are eligible for JOBZ designation. 1A.2: Determine level of city involvement. Options include city ownership (using master developer strategy or some form of public-private partnership) or private ownership with city serving as facilitator. 1A.3: Engage development community.

Strategy 1A: Make land available for business expansion

Opportunity 1: Diversifying the economic base

ABOUT THIS MATRIX: The following matrix provides a summary of the strategies and action items set forth in the plan. It is intended to provide an overview of the responsible parties for each task, as well as a general sense of the timeframe for completion. Priority items are indicated with a check mark (9). Budget estimates are provided for those items that require special consideration (i.e., where consultants may be required, where staff cannot be re-directed into new activities, or where new resources must be applied). Other budget items are described as “not applicable” (NA) because existing budgets can be redirected, or “to be determined” (TBD) because costs associated with these items will be dependent upon the specific action chosen and cannot be estimated in advance.

IMPLEMENTATION MATRIX

comprehensive economic development plan:

9 Funding options 9 Linkages to rest of city 9 Impacts 9 Positioning of project (see 1A.5) 1A.5: Position property as “blue ribbon” project. 1A.6: Develop marketing and recruitment strategy. • Existing business. Identify potential tenants for industrial center among existing businesses. • Second-tier opportunities. Identify suppliers and support facilities of existing businesses that could potentially be tenants of park. • Opportunity. Explore potential linkages with the colleges, the hospital, and other regional initiatives. These linkages should be explored for both potential tenants as well as any basis for positioning the project. • Prepare recruitment strategy. Prepare a strategy for marketing the selected site to target industries. This would include creating custom direct mail materials. • Prepare promotional materials specific to the site including a brochure and designated website (or webpage on the city’s existing site).

at time of construction and other considerations, such as carrying costs)

• Developer’s forum. Event could be organized using a round-table format, with developers leading the discussion, or a charrette approach. • Request for proposal (RFP). Issue formal RFP to local and regional developers for a detailed concept and site plan for one of the preferred development sites. 1A.4: Develop area plan for specific site. Elements to consider in plan: 9 Barriers to development and potential solutions 9 Mix of uses and phasing (based on market conditions

Actions

EDA

EDA & City

EDA

6 to 12 months

Next 6 months

EDA

EDA & City

EDA

Lead Organization

Timeframe 1 to 2 years 2 to 5 years Ongoing

Target industry mailing costs included under Strategy 1C.1 $2,500 brochure design, plus printing $1,500 web page with link to PDF of brochure

$4,000

depends on number of sites evaluated and parameters.

Up to $100,000 if outsourced. Price

$500 for incidental expenses (e.g., postage, meals)

Additional Budget

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

IMPLEMENTATION MATRIX

comprehensive economic development plan:

• Intervention. Develop “rapid response” strategy for dealing with potential layoffs or plant closures. Familiarize team with available tools to assist “at-risk” companies (e.g., ESOPs, MEP, retraining programs). 1B.2: Support small business development. • Tools. Promote available programs for small businesses (e.g., providing links on NEC website to relevant state and federal programs). Provide fact sheets on areas of interest (e.g., state procurement, exporting, business process improvements).

Strategy 1B: Concentrate on the needs of existing businesses 1B.1: Enhance business retention and expansion (BRE) program. • Inventory. Maintain inventory of existing businesses and available properties using available records, (e.g., tax records, utility hookups, ownership transfers). • Survey. Conduct an annual employer survey. The “Valuing our Corporate Neighbors” on-site visitation form could be a starting point but should be shortened or divided it into a series of shorter surveys to facilitate participation. • Visitation. Enhance existing target of 3 business visits per quarter by applying additional resources (e.g., EDA members, chamber officials--under the Grow Minnesota effort--and Ambassadors). Established post-visit procedures. • Forum. Schedule regular business forums (e.g., quarterly) with economic and community development staff. • Benchmarking. Implement benchmarking program, including 3 visits to benchmark communities annually.

Actions

EDA & NCC EDA & NCC

NEC

EDA & NCC

Ongoing

EDA

2 to 5 years

Timeframe 1 to 2 years

EDA

6 to 12 months X

Next 6 months

EDA

Lead Organization

$500 for incidental expenses (e.g., postage, meals) $4,500 (Assumes 3 trips for 2 people at $750/person/trip)

$5,000

Additional Budget

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

IMPLEMENTATION MATRIX

comprehensive economic development plan:

• Networking. Establish a coordinated meeting schedule for topics of interest to local business. Promote applicable topics, (e.g. entrepreneurship), on a regional basis. • Barriers. Take steps to ensure that government is “business-friendly”: – Conduct review of development regulations, ordinances and approval processes. – Appoint small business ombudsman to serve as the primary point of contact for new and small business. • Capital. Work with local financial community to improve access to capital (e.g., encouraging new lending models to meet technology needs of businesses). – Explore feasibility of creating capital network – Establish contacts with angel and venture capital community at the regional, state, and national level. • Leverage funds. Assist private companies in securing government funds (e.g., SBIR awards). Begin by identifying local/regional recipients of such awards to learn more about constraints faced in competing. Strategy 1C: Implement a targeted recruitment strategy 1C.1: Build awareness among decision-makers in target industries. • Database. Develop and maintain database of companies in each target industry.

Actions

EDA

Ongoing

EDA

2 to 5 years

Timeframe 1 to 2 years

EDA

EDA & NEC

EDA

6 to 12 months

Next 6 months

EDA

City

NEC & NCC

Lead Organization

$3,000 for purchase of company lists (Assumes $500 per target sector)

$36,500

$40,600

Additional Budget

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

IMPLEMENTATION MATRIX

comprehensive economic development plan:

with appointment setting

direct mail program to sector. Develop one-page target industry. Mailings continue for at least six

of interest to site selectors and others (via website).

separate cover.) • Information. Maintain and update information typically

1C.2: Build awareness among corporate site selectors. • Database. Update and maintain a database of site consultants. (Provided by TIP Strategies under

• Metrics. Track success of target industry campaign using a contact management system (using standard database program or customized software).

• Call trips. Conduct 4 call trips per year (one each quarter) to regions where industry concentration is highest. Schedule in conjunction with trade shows or other events. • Intelligence. Compile and maintain resource information for each target industry sector, including trade associations, trends, trade publications, sources of data. Participation in industry trade events (trade shows) should be part of this effort.

• Mail campaign. Initiate a companies in each target marketing letter for each should occur monthly and months. • Follow-up. Follow mailings campaigns (telephone).

Actions

EDA

Lead Organization Next 6 months

6 to 12 months

Timeframe 1 to 2 years 2 to 5 years

Ongoing

$4,100

$5,000 and up for customized software or could track using spreadsheet program

Travel: $15,000 (3 shows/year, at $5,000/show for fees and expenses) Data purchases and subscriptions: $2,500

$3,000 (Assumes 2 trips/year at $1,500 each)

$3,000 (Assumes 3 letters/ year to 1,000 companies at $1/letter) $5,000 (Assumes 2 campaigns at $2,500 each)

Additional Budget

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

IMPLEMENTATION MATRIX

comprehensive economic development plan:

• Visitation program. Visit site consultants in the Twin Cities and other major metropolitan areas (Chicago, Atlanta, Dallas) on regular basis and in conjunction with attendance at trade shows or other events. • Event. Host “developer’s day” event in Northfield for site consultants and regional industrial and commercial brokers. 1C.3: Establish written incentives policy. Should provide clear guidance on the following: 9 Standards to qualify for incentives. Should emphasize investment (measured by direct capital investment and aggregate payroll) in addition to “jobs created.” 9 Priority for awarding, with emphasis on employers that create higher wage jobs (i.e., some percentage above the median wage for the region). 9 “Clawback” provisions, (i.e., conditions under which incentive would be withdrawn). Strategy 1D: Raise awareness of Northfield within the region 1D.1: Develop specific economic development media strategy. • Press kit. Develop economic development press kit. • Contacts. Develop a list of reporters with relevant publications and contact them to determine the types of stories they are interested in. • Press releases. Provide press releases on a regular basis. Should focus on particular event or release of new report or indicator about the area. 1D.2: Enhance Northfield Chamber’s Ambassador efforts.

• Letter campaign. Initiate a monthly site consultant letter campaign highlighting different opportunity.

Actions

EDA & NCC

EDA

EDA EDA

EDA

Timeframe 1 to 2 years

EDA

6 to 12 months

Next 6 months

EDA

Lead Organization 2 to 5 years

Ongoing

$2,500

$500 for incidental expenses (e.g., postage, meals)

$3,000 (Assumes 4 visits at $750 each)

$600 (Assumes 100 letters every other month for 12 months)

Additional Budget

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

IMPLEMENTATION MATRIX

comprehensive economic development plan:

• Assemble candidates. Work with NCC’s Ambassadors Committee to identify additional candidates and expanded role. • Engage. Establish regular meetings for updating Ambassadors on current initiatives of city and other relevant groups. Consider creating a mechanism for the Ambassadors to refer prospect leads. • Profile. Create a brief profile touting the region’s positive aspects to be used by the Ambassadors and other area business leaders. 1D.3: Leverage conferences and networking opportunities. • Joint calendar. Post locally sponsored events on joint calendar (e.g., calendar on the city’s website) with links to calendar from relevant organizations. Calendar should also include meetings and events sponsored by relevant regional organizations (such as regional chambers, industry trade associations). • Regional promotion. Help promote Northfield events — whether hosted by the city, the colleges or other organizations — on a regional basis. Strategy 1E: Explore options for leveraging existing fiber network 1E.1 Create task force. Should include representatives from city, EDA, colleges, major employers, and other stakeholders. 1E.2 Issue RFP. Purpose is to help city better understand options and cost implications.

Actions

X X X

City, EDA City, EDA City

EDA, NEC, NCC, City

Ongoing

EDA & NCC

2 to 5 years

EDA, NEC, NCC, City

Timeframe 1 to 2 years

EDA & NCC

6 to 12 months

Next 6 months

EDA & NCC

Lead Organization

$2,500 for preparation and printing of profile

Additional Budget

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

IMPLEMENTATION MATRIX

comprehensive economic development plan:

Actions

City

EDA & City

Timeframe 1 to 2 years

6 to 12 months

EDA, City (Design Advisory Board)

EDA

Next 6 months

2 to 5 years

Ongoing

$500 for incidental expenses (e.g., postage, meals) related to additional developers forum

$500 for Cannon River developer forum

$500

Additional Budget

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

• Mixed-use projects. Ensure that mixed use projects can be accomplished in the Cannon River area and downtown. 2A.2: Increase density of uses in downtown.

Strategy 2A: Maintain and enhance the existing downtown 2A.1: Activate the Cannon River. Emphasis should be placed on identifying development and redevelopment sites in the area south of 5th Street (see map, page 31). Current projects (e.g., The Crossing at Northfield, the QBlock), should be reviewed for their orientation to the river and for their ability to spur additional activity in the downtown. • Design. Address issues such as urban design standards, parking and traffic circulation, and infrastructure planning across the corridor. Examples of corridor planning principles include: – Applying distinctive architectural and urban design elements from downtown Streetscape Framework Plan throughout Cannon River corridor. – Linking existing pedestrian areas and ensuring that new development ties into these systems. – Ensuring that existing zoning and ordinances create the desired feel for the area. – Reviewing existing regulations to identify any that would hinder redevelopment unnecessarily. • Development community. Include local and regional developers early in the process. (See Strategy 1A.3.) NDDC

Lead Organization

Opportunity 2: Maintaining Northfield’s quality of place

IMPLEMENTATION MATRIX

comprehensive economic development plan:

2B.1: Formalize retail working group. Build on existing efforts. Purpose is to identify gaps and overlaps, coordinate planning and marketing initiatives, and maximize existing resources. Include representatives from the NDDC, NCC’s Retail Committee, NCVB, the EDA, local developers, tourism-related groups, and city staff, as well as the colleges.

• Recruitment. Recruit professional services and business support firms in ways similar to traditional manufacturing recruitment (e.g., identifying gaps, targeting specific firms, offering incentives, particularly for those firms that locate downtown). • Creative financing. Identify incentives (e.g., low interest loans, favorable lease rates) that could be applied to professional services firms that pay higher wages or locate in the downtown. • General support. Identify means for supporting professional services, such as job training assistance, network events sponsored by the EDA and other organizations, and help in accessing new clients (e.g., by helping access public sector contracts). 2A.3: Encourage downtown housing. Important ingredients of a strategy for successful downtown residential development include: 9 Creating neighborhood identity 9 Balancing conflicting uses (e.g., have noise ordinances or incentives for sound-proofing ) 9 Understanding market demand Strategy 2B: Develop coordinated retail strategy

Actions

NDDC

City & NDDC

Timeframe 1 to 2 years

EDA, NDDC, & NCC

6 to 12 months

Next 6 months

EDA

EDA & NDDC

Lead Organization

2 to 5 years

Ongoing

Up to $75,000 if retail analysis is outsourced

NA (Mailing costs related to professional service recruitment included under Strategy 1C.1)

Additional Budget

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

IMPLEMENTATION MATRIX

comprehensive economic development plan:

2B.2: Compile existing data on the downtown retail market. Build on existing studies. Should include the following: 9 Analysis of consumer expenditure patterns in the area, Documentation of needs of existing retailers (particularly in the downtown), 9 Identification of current “gaps” and opportunities for retail development in the region, 9 Information on site location factors for existing and potential retailers 9 Inventory of existing sites, including redevelopment opportunities, as well as potential barriers to their development. 2B.3: Identify appropriate retail prospects. • Identify retail prospects. Consideration should be given to the following: 9 findings of retail analysis (outlined above) 9 other findings of retail working group 9 relationship to existing “big box” development on Highway 3 9 scale of target (i.e., ability of retailers to attract outside dollars) 9 relationship to Northfield’s assets (e.g., outdoor recreation, arts, and college-oriented retailers • Integration. Require future developments along Highway 3 to meet design standards that reflect those of the downtown, such as repeating specific themes from the downtown palette. • Developers. Identify and promote retail opportunities to developers who represent desired retail tenants. 2B.4: Link retail and tourism. • Inventory. Maintain and promote an inventory of local attractions and tourism assets (to include diversity, quality of overnight accommodations in the region).

Actions

NCC

EDA & NDDC

2 to 5 years

Timeframe 1 to 2 years

City (Design Advisory Board)

6 to 12 months

Next 6 months

NDDC

Lead Organization

Ongoing

NA* *(Assumes that full retail analysis conducted under Strategy 2B.2)

NA*

Up to $75,000 if outsourced

Additional Budget

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

IMPLEMENTATION MATRIX

comprehensive economic development plan:

• Awareness. Make local retailers aware of tourismrelated activities and methods for exploiting related retail opportunities (e.g., offering extended hours of operation to accommodate specific events or designing sales and marketing efforts around a related theme). • Signage. Build on current public improvement efforts related to “way-finding”, including the recently completed Streetscape Framework Plan and approval of a Historic Downtown Northfield sign along I-35. Strategy 2C: Re-define Northfield’s relationship to its neighbors. 2C.1 Identify best practices. Initial efforts should investigate databases compiled by the State Auditor’s Office and the League of Minnesota Cities. 2C.2 Form Rice County working group. This group would explore potential for collaboration among Rice County communities (similar to Dakota County’s High Performance Partnership effort.)

Actions

Colleges

EDA

Colleges

Colleges/EDA

City

Timeframe 1 to 2 years

City (Design Advisory Board)

6 to 12 months

Next 6 months

NCC & NDDC

Lead Organization

2 to 5 years

Ongoing

Check with St. Olaf and Carleton for current rates.

E-mail: $2,500 for set-up costs Direct mail: $2,000 (Assumes 500 letters/quarter at $1/letter)

$4,500

$4,500 excluding any ad placement costs

Additional Budget

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

• Alumni publications. Use these publications to communicate with alumni, by 1) drafting articles on topics of interest to the alumni (as complements to mail and e-mail campaigns), 2) placing advertisements.

3A.1: Explore mechanisms for re-capturing Carleton and St. Olaf alumni. • Mail and e-mail campaign. Create letters, direct mail materials, and website linkages aimed at increasing alumni’s awareness of opportunities and advantages of living in Northfield.

Strategy 3A: Increase connection with current and former students

Opportunity 3: Attracting and retaining talent

IMPLEMENTATION MATRIX

comprehensive economic development plan:

• Events. Ensure that relevant events are marketed to area alumni. Encourage St. Olaf and Carleton alums already in the community to assist in this effort. 3A.2: Engage current students. • Projects. Work with professors at both institutions to identify projects that engage students in the cultural, economic, and political fabric of the community (College Board of Business Consultants is example). • Volunteerism. Support volunteer programs at St. Olaf and Carleton by helping to link the needs of local organizations with the colleges’ programs. • Events. Ensure that relevant events are marketed to the colleges. Work with outreach coordinators at each facility to develop events or refocus existing events to better engage this group when possible. Strategy 3B: Continue to engage leadership of colleges in economic development. 3B.1: Encourage joint participation. Formalize crossrepresentation on relevant boards and commissions. Identify opportunities for partnerships. • Old Middle School. Support Carleton by promoting site to appropriate prospects. Investigate potential to support media and arts-related entrepreneurship. • Healthcare complex. Reconsider city’s previous development proposal regarding St. Olaf-owned property. (See Strategy 1A). 3B.2: Explore best practices for economic development and higher education. Critical elements include entrepreneurship, enfranchising local businesses in city and college initiatives, and defining a “stewardship” role for colleges. Strategy 3C: Increase the range of housing options 3C.1: Support HRA’s current programs.

Actions

X X

EDA City/EDA

HRA EDA/HRA

EDA/Colleges

City & EDA

EDA

X X

Colleges

Ongoing

2 to 5 years

Timeframe 1 to 2 years

EDA, Colleges, & City

6 to 12 months

Next 6 months

Colleges

Lead Organization

NA NA

Additional Budget

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

IMPLEMENTATION MATRIX

comprehensive economic development plan:

Finance Agency report which includes case study of the “Clover Ridge” development in Chaska, MN.)

• Joint planning. Coordinate EDA and HRA work plans and goals to ensure that efforts do not conflict. • Business liaison. Appoint EDA member liaison between HRA and local businesses. (see Strategy 3C.2). 3C.2: Work with major employers to document scope of housing issue. • Interviews. Interview the city’s major employers to determine key issues. Include question on housing issues (i.e., range of options and availability) as part of any business retention and expansion surveys. • Employer-assisted housing (EAH). Explore feasibility of encouraging EAH programs. • Explore related programs. Ensure that city is accessing all available state and federal programs related to the provision of workforce housing. 3C.3: Work with the HRA to identify additional programs/best practices. • Density bonuses. Consider density bonus program to encourage affordable ownership and rental housing. Could also be used to encourage other public benefits: open space, trails and parks; historic preservation; and energy conservation. • Real estate transfer tax. Investigate whether a real estate transfer tax can be implemented in Northfield for the purpose of funding the development of workforce housing. • Multifamily housing programs. Ensure that affordable housing efforts address both single-family and multifamily housing needs. (e.g., grant programs or long-term forgivable loans). • Inclusionary zoning. Explore feasibility of inclusionary zoning ordinances. (See 2002 Minnesota Housing

Actions

HRA

City

HRA

City

HRA

EDA

6 to 12 months

Next 6 months

EDA/HRA

Lead Organization

Timeframe 1 to 2 years

2 to 5 years

Ongoing

Additional Budget

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

IMPLEMENTATION MATRIX

comprehensive economic development plan:

3D.1: Form virtual incubator. Identify ways to accomplish the following (without a physical building): 9 Reduce cost of doing business during a phase in which expenses exceed revenues (e.g., reduced lease space and administrative costs, as well as shared equipment (office and, potentially, machinery) 9 Consolidating business support activities including counseling and technical assistance 9 Creating synergy with related businesses through shared technology, marketing capacity, and shared talent pool 3D.2: Expand use of the capital investment fund. Examples include write-downs, creative leasing for existing office and industrial space. Begin by designating certain buildings (especially in the downtown) as technology service-oriented start-up centers. 3D.3: Engage higher education in this strategy. Place emphasis on linking classroom experience to existing industry needs. St. Olaf’s Finstad Office for Entrepreneurial Studies should serve as a resource.

Strategy 3D: Create entrepreneurial and innovative start-up opportunities

Housing Finance Agency’s Model Zoning Technical Advisory Group report, 2003.)

• Other. Review Fannie Mae’s website regarding tools and reports on affordable housing strategies (i.e., 2005 Housing Solutions report). 3C.4: Review existing ordinances. Make sure that permitting and site plan review can be done in a timely fashion to meet lending requirements. (See Minnesota

Actions

NEC

NEC/Colleges

NEC

City

6 to 12 months

Next 6 months

HRA

Lead Organization

Timeframe 1 to 2 years 2 to 5 years

Ongoing

$5,000 plus up to $260,000 in private sponsorships

Additional Budget

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

IMPLEMENTATION MATRIX

comprehensive economic development plan:

3D.7: Provide stipends to promising engineers and students in the region. Stipends should be funded by existing corporations and/or the colleges and linked to work carried out in the region. Strategy 3E: Take steps to integrate cityâ&#x20AC;&#x2122;s growing Hispanic/Latino population. 3E.1: Increase understanding of the Hispanic/Latino population. Work with community development organizations to document Northfieldâ&#x20AC;&#x2122;s Hispanic/Latino population and identify specific needs. 3E.2: Address systemic issues most closely tied to economic development. Emphasis should be given to facilitating small business opportunities.

3D.4: Create an innovation and entrepreneurship task force. Charge task force with specific tasks, e.g., inventorying small business and entrepreneurial programs, working with colleges to analyze small business opportunities, exploring real estate options (above). 3D.5 Leverage state and federal funding. Work with local industry groups to identify issues and potential funding (e.g., SBIR awards and others, including search of Catalog of Federal Domestic Assistance). 3D.6: Host design competitions underwritten by local companies. Meet with major employers and colleges to create a formal design competition.

Actions

EDA

City

NEC, EDA, & Colleges

Timeframe 1 to 2 years

NEC

6 to 12 months

Next 6 months

EDA & NEC

NEC

Lead Organization

2 to 5 years Ongoing

(Assumes $50,000 stipend awarded to 5 individuals)

$250,000

(Privately funded)

$5,000 for publicity and incidentals $10,000 award

Additional Budget

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

IMPLEMENTATION MATRIX

comprehensive economic development plan:

Minnesota’s centralized approach to government financing complicates tax analyses at the local level. A review of tax capacity (see box) data prepared by the League of Minnesota Cities sheds some light on the question of Northfield’s reliance on residential property tax. Figures on total tax capacity (the aggregation of all tax capacities in a jurisdiction) from the League’s August 2005 report reveal that the composition of Northfield’s tax capacity is more reliant on residential property taxes than other similarly situated cities. Within Northfield’s city cluster (see box, next page), the average percent of tax capacity x

class rate

parcel tax capacity

League of Minnesota Cities

residential homestead has a class rate of 1.0 percent, and therefore has a tax capacity of $75,000 x .01 or $750.

Example: A $75,000 home classified as a

parcel market value

The market value of a given taxable parcel multiplied by its property class rate

definition: TAX CAPACITY

The other major category of revenues for Northfield was intergovernmental revenues (e.g., local government aid, highway maintenance aid, fire relief aid and police aid; as well as federal and county grants), which accounted for 40% of total general fund revenues in 2004. Charges for services (12%) and licenses and permitting fees (8 %) accounted for the bulk of the remainder.

Diversification of the tax base is also a concern for Northfield. Rising property values have led to a cry for tax relief from homeowners and concerns about over-reliance on residential property tax. According to the city’s Comprehensive Annual Financial Report (for the year ended December 31, 2004), general property taxes comprised one-third of general fund revenues in 2004. Data on city revenues compiled by the State Auditor’s Office suggests this figure is only slightly above average. Of the 849 cities for which data were available, property tax revenues averaged 29% of total revenues in 2004.

APPENDIX A: ADDITIONAL PROPERTY TAX ANALYSIS

comprehensive economic development plan: NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

A-1

Homestead 73.51% 49.14% 65.23% 81.20% 73.67% 37.00% 62.30% 64.81% 61.89% 35.14% 52.03% 57.76%

Total Tax Capacity $47,109,350 $889,470 $12,309,699 $13,664,564 $48,222,710 $24,695,701 $7,094,326 $11,615,943 $15,353,694 $19,448,593

$215,921,864

$3,639,301,148

Source: League of Minnesota Cities

City Apple Valley Dundas Faribault Farmington Lakeville Mankato New Ulm Northfield Owatonna Red Wing GMN Regional Centers Total All MN Cities 11.19%

10.46%

Tax Capacity Non-Hstd Residential 8.05% 3.31% 10.37% 7.44% 6.39% 13.62% 6.57% 10.33% 8.52% 5.89%

Total Tax Capacity for Selected Cities, 2005

0.54%

0.43%

26.74%

30.77%

Composition (%) Commercial/ Farm Industrial 0.18% 16.09% 1.93% 43.38% 0.47% 20.49% 0.75% 7.42% 1.06% 16.38% 0.17% 44.69% 0.19% 30.51% 0.24% 22.68% 0.38% 28.09% 0.72% 18.93%

3.76%

6.31%

Other 2.17% 2.23% 3.45% 3.19% 2.50% 4.52% 0.43% 1.95% 1.11% 39.33%

Northfield homeowners experienced a reduction in the property taxes paid to the city in real terms, with the city tax on a $200,000 homestead falling from $983 in 1997 to $715 in

To better understand the tax burden on homeowners we turned to the League of Minnesota Cities’ property tax calculator. Using this tool, we compiled the estimated tax burden for a hypothetical $200,000 homestead in selected cities in 1997 and 2005 (see table, next page). Due to changes in the property tax law, residents in each city experienced reductions in their total property tax bills. However, changes in the city portion of the tax bill varied widely between 1997 and 2005 in the cities analyzed.

represented by commercial or industrial property is 30.77%, with residential (both homestead and non-homestead) accounting for 62.49%. For Northfield, these figures are 22.68% and 75.14%, respectively. Northfield’s tax capacity is less reliant on residential property than some of its neighbors (Lakeville, Farmington), but more dependent than others (Dundas, Owatonna).

APPENDIX A: ADDITIONAL PROPERTY TAX ANALYSIS

comprehensive economic development plan:

A-2

League of Minnesota Cities

Additional information regarding the methodology is available in Clustering Minnesota’s Cities: 15 City Cluster Methodology on the League’s website at www.lmnc.org.

The League of Minnesota Cities divides cities into “relatively homogeneous groups based on four characteristics: population in 2000, population change 1990 to 2000, median household income in 1999, and commercial/industrial tax base per capita in 2002.” Under this methodology, Northfield is part of the “Greater Minnesota (GMN) Regional Centers” cluster.

“Clustering Minnesota’s Cities”

NORTHFIELD ECONOMIC DEVELOPMENT AUTHORITY

547 13,594 16,116 12,365 32,427 45,527 17,147 20,818 22,434 43,128

1997 $4,181 $4,304 $3,687 $4,229 $3,937 $4,052 $4,109 $4,641 $4,136 $3,702

2005 $3,130 $2,895 $2,950 $2,341 $2,060 $2,197 $2,376 $1,787 $2,691 $2,127 $2,938 $2,703 $2,757 $2,148 $1,868 $2,005 $2,183 $1,594 $2,499 $1,935

(with MVHC tax credit)

(as of 2000 Census) -$1,243 -$1,601 -$930 -$2,081 -$2,069 -$2,047 -$1,926 -$3,047 -$1,637 -$1,767

(with MVHC tax credit)

Change 1997–2005 1997 $973 $1,105 $939 $1,145 $895 $989 $983 $879 $727 $633

2005 $1,516 $1,266 $1,167 $875 $750 $774 $785 $548 $826 $639 $1,413 $1,175 $1,083 $800 $673 $700 $715 $488 $758 $572

(with MVHC tax credit)

2005

City Tax

$440 $70 $144 -$345 -$222 -$289 -$268 -$391 $31 -$61

(with MVHC tax credit)

Change 1997–2005 1997 23.3% 25.7% 25.5% 27.1% 22.7% 24.4% 23.9% 18.9% 17.6% 17.1%

48.1% 43.5% 39.3% 37.2% 36.0% 34.9% 32.8% 30.6% 30.3% 29.6%

(with MVHC tax credit)

2005

City Tax as Share of Total Tax

A-3

Sources: League of Minnesota Cities, shaded areas calculated by TIP Strategies, Inc. Note: Beginning in 2002, the education homestead credit was replaced with the market value homestead credit (MVHC). The 2005 total tax burden reflects $192 reduction for the MVHC. Within this total, the reduction in the city portion of the tax bill ranged from a low of $60 (Faribault) to a high of $103 (Dundas).

City Dundas New Ulm Red Wing Farmington Mankato Apple Valley Northfield Faribault Owatonna Lakeville

2005

Population

Total Tax

Estimated Tax Burden for $200,000 Residential Homestead in Selected Cities (Ranked by City Tax as Share of Total Tax in 2005)

2005, including the market value homestead credit (MVHC) enacted in 2002. In contrast, the local share of property tax on a $200,000 homestead in Dundas rose by $440 during the period. The share that city taxes represent of the total tax bill increased for all of the cities.

APPENDIX A: ADDITIONAL PROPERTY TAX ANALYSIS

comprehensive economic development plan:

State Statutes

Section 13

Page Left Blank

MINNESOTA STATUTES 2008

CHAPTER 469 ECONOMIC DEVELOPMENT

469.090

ECONOMIC DEVELOPMENT AUTHORITIES DEFINITIONS.

469.091

ECONOMIC DEVELOPMENT AUTHORITY.

469.092

LIMIT OF POWERS.

469.093

PROCEDURAL REQUIREMENT.

469.094

TRANSFER OF AUTHORITY.

469.095

COMMISSIONERS; APPOINTMENT, TERMS, VACANCIES, PAY, REMOVAL.

469.096

OFFICERS; DUTIES; ORGANIZATIONAL MATTERS.

469.097

EMPLOYEES; SERVICES; SUPPLIES.

469.098

CONFLICT OF INTEREST.

469.099

DEPOSITORIES; DEFAULT; COLLATERAL.

469.100

OBLIGATIONS.

469.101

POWERS.

469.102

GENERAL OBLIGATION BONDS.

469.103

REVENUE BONDS; PLEDGE; COVENANTS.

469.104

SECTIONS THAT APPLY IF FEDERAL LIMIT APPLIES.

469.105

SALE OF PROPERTY.

469.106

ADVANCES BY AUTHORITY.

469.107

CITY MAY LEVY TAXES FOR ECONOMIC DEVELOPMENT AUTHORITY.

469.108

SPECIAL LAW; OPTIONAL USE.

469.1081

LIABLE IN CONTRACT OR TORT.

469.1082

COUNTY ECONOMIC DEVELOPMENT AUTHORITY OR HOUSING AND REDEVELOPMENT AUTHORITY WITH ECONOMIC DEVELOPMENT POWERS.

MINNESOTA STATUTES 2008

105

469.090

Subd. 11. Transfer of city property to port. The city of Winona may transfer, with or without consideration and on other terms the city council considers desirable, its interest in any real property, including fee title, to the port authority of Winona. The transfer must be authorized by ordinance. The ordinance must contain the following: (1) the general location and the specific legal description of the property; (2) a finding by the city council that the real property is marginal under section 469.058, supported by reference to one or more of the conditions listed in section 469.048, subdivision 5; (3) a statement as to the consideration, or absence of it, to be received by the city at the time of transfer; and (4) other information considered appropriate by the city council. A conveyance of fee title under this subdivision must be by quitclaim deed. History: 1987 c 291 s 90 ECONOMIC DEVELOPMENT AUTHORITIES 469.090 DEFINITIONS. Subdivision 1. Generally. In sections 469.090 to 469.108, the terms defined in this section have the meanings given them herein, unless the context indicates a different meaning. Subd. 2. Authority. "Authority" means an economic development authority. Subd. 3. City. "City" means a home rule charter or statutory city. Subd. 4. Development. "Development" includes redevelopment, and "developing" includes redeveloping. Subd. 5. Cost of redevelopment. "Cost of redevelopment" means, with respect to an economic development district project, the cost of: (1) acquiring property, whether by purchase, lease, condemnation, or otherwise; (2) demolishing or removing structures or other improvements on acquired properties; (3) correcting soil deficiencies necessary to develop or use the property for an appropriate use as determined by the authority; (4) constructing or installing public improvements, including streets, roads, and utilities; (5) providing relocation benefits to the occupants of acquired properties; (6) planning, engineering, legal, and other services necessary to carry out the functions listed in clauses (1) to (5); and (7) the allocated administrative expenses of the authority for the project.

MINNESOTA STATUTES 2008

106

469.092

History: 1987 c 291 s 91 469.091 ECONOMIC DEVELOPMENT AUTHORITY. Subdivision 1. Establishment. A city may, by adopting an enabling resolution in compliance with the procedural requirements of section 469.093, establish an economic development authority that, subject to section 469.092, has the powers contained in sections 469.090 to 469.108 and the powers of a housing and redevelopment authority under sections 469.001 to 469.047 or other law, and of a city under sections 469.124 to 469.134 or other law. If the economic development authority exercises the powers of a housing and redevelopment authority contained in sections 469.001 to 469.047 or other law, the city shall exercise the powers relating to a housing and redevelopment authority granted to a city by sections 469.001 to 469.047 or other law. Subd. 2. Characteristics. An economic development authority is a public body corporate and politic and a political subdivision of the state with the right to sue and be sued in its own name. An authority carries out an essential governmental function when it exercises its power, but the authority is not immune from liability because of this. Subd. 3. Unpaid officers, directors, and agents; liability. Section 317A.257 applies to an economic development authority or to a nonprofit corporation exercising the powers of an economic development authority. History: 1987 c 291 s 92; 1994 c 623 art 5 s 2 469.092 LIMIT OF POWERS. Subdivision 1. Resolution. The enabling resolution may impose the following limits upon the actions of the authority: (1) that the authority must not exercise any specified powers contained in sections 469.001 to 469.047, 469.090 to 469.108, and 469.124 to 469.134 or that the authority must not exercise any powers without the prior approval of the city council; (2) that, except when previously pledged by the authority, the city council may by resolution require the authority to transfer any portion of the reserves generated by activities of the authority that the city council determines is not necessary for the successful operation of the authority to the debt service fund of the city, to be used solely to reduce tax levies for bonded indebtedness of the city; (3) that the sale of all bonds or obligations issued by the authority be approved by the city council before issuance; (4) that the authority follow the budget process for city departments as provided by the city and as implemented by the city council and mayor;

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107

469.093

(5) that all official actions of the authority must be consistent with the adopted comprehensive plan of the city, and any official controls implementing the comprehensive plan; (6) that the authority submit all planned activities for influencing the action of any other governmental agency, subdivision, or body to the city council for approval; (7) that the authority submit its administrative structure and management practices to the city council for approval; and (8) any other limitation or control established by the city council by the enabling resolution. Subd. 2. Modification of resolution. The enabling resolution may be modified at any time, subject to subdivision 5, and provided that any modification is made in accordance with this section. Subd. 3. Report on resolution. Without limiting the right of the authority to petition the city council at any time, each year, within 60 days of the anniversary date of the first adoption of the enabling resolution, the authority shall submit to the city council a report stating whether and how the enabling resolution should be modified. Within 30 days of receipt of the recommendation, the city council shall review the enabling resolution, consider the recommendations of the authority, and make any modification it considers appropriate. Modifications must be made in accordance with the procedural requirements of section 469.093. Subd. 4. Compliance. The city council's determination that the authority has complied with the limitations imposed under this section is conclusive. Subd. 5. Limits; security. Limits imposed under this section must not be applied in a manner that impairs the security of any bonds issued or contracts executed before the limit is imposed. The city council must not modify any limit in effect at the time any bonds or obligations are issued or contracts executed to the detriment of the holder of the bonds or obligations or any contracting party. History: 1987 c 291 s 93 469.093 PROCEDURAL REQUIREMENT. Subdivision 1. Enabling resolution. The creation of an authority by a city must be by written resolution referred to as the enabling resolution. Before adopting the enabling resolution, the city council shall conduct a public hearing. Notice of the time and place of hearing, a statement of the purpose of the hearing, and a summary of the resolution must be published in a newspaper of general circulation within the city once a week for two consecutive weeks. The first publication must appear not more than 30 days from the date of the public hearing. Subd. 2. Modifications. All modifications to the enabling resolution must be by written resolution and must be adopted after notice is given and a public hearing conducted as required

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108

469.094

for the original adoption of the enabling resolution. History: 1987 c 291 s 94 469.094 TRANSFER OF AUTHORITY. Subdivision 1. Economic development, housing, redevelopment powers. The city may, by ordinance, divide the economic development, housing, and redevelopment powers granted under sections 469.001 to 469.047 and 469.090 to 469.108 between the economic development authority and any other authority or commission established under statute or city charter for economic development, housing, or redevelopment as provided in subdivision 2. Subd. 2. Project control, authority, operation. The city may, by resolution, transfer the control, authority, and operation of any project as defined in section 469.174, subdivision 8, or any other program or project authorized by sections 469.001 to 469.047 or 469.124 to 469.134 located within the city, from the governmental agency or subdivision that established the project to the economic development authority. The city council may also require acceptance of control, authority, and operation of the project by the economic development authority. The economic development authority may exercise all of the powers that the governmental unit establishing the project could exercise with respect to the project. When a project or program is transferred to the economic development authority, the authority shall covenant and pledge to perform the terms, conditions, and covenants of the bond indenture or other agreements executed for the security of any bonds issued by the governmental subdivision that initiated the project or program. The economic development authority may exercise all of the powers necessary to perform the terms, conditions, and covenants of any indenture or other agreements executed for the security of the bonds and shall become obligated on the bonds when the project or program is transferred as provided in this subdivision. If the city transfers a housing project or a housing development project to the economic development authority, the city must transfer all housing development and management powers relating to that specific project to the authority. Subd. 3. Transfer of personnel. Notwithstanding any other law or charter provision to the contrary, the city council may, by resolution, place any employees of the housing and redevelopment authority under the direction, supervision, or control of the economic development authority. The placement of any employees under the direction, supervision, or control of the economic development authority does not affect the rights of any employees of the housing and redevelopment authority, including any rights existing under a collective bargaining agreement or fringe benefit plan. The employees shall become employees of the economic development authority. History: 1987 c 291 s 95; 1990 c 532 s 11,12

109

MINNESOTA STATUTES 2008

469.095

469.095 COMMISSIONERS; APPOINTMENT, TERMS, VACANCIES, PAY, REMOVAL. Subdivision 1. Commissioners. Except as provided in subdivision 2, paragraph (d), an economic development authority shall consist of either three, five, or seven commissioners who shall be appointed after the enabling resolution provided for in section 469.093 becomes effective. The resolution must indicate the number of commissioners constituting the authority. Subd. 2. Appointment, terms; vacancies. (a) Three-member authority: the commissioners constituting a three-member authority, one of whom must be a member of the city council, shall be appointed by the mayor with the approval of the city council. Those initially appointed shall be appointed for terms of two, four, and six years, respectively. Thereafter all commissioners shall be appointed for six-year terms. (b) Five-member authority: the commissioners constituting a five-member authority, two of whom must be members of the city council, shall be appointed by the mayor with the approval of the city council. Those initially appointed shall be appointed for terms of two, three, four, five, and six years respectively. Thereafter all commissioners shall be appointed for six-year terms. (c) Seven-member authority: the commissioners constituting a seven-member authority, two of whom must be members of the city council, shall be appointed by the mayor with the approval of the city council. Those initially appointed shall be appointed for terms of one, two, three, four, and five years respectively and two members for six years. Thereafter all commissioners shall be appointed for six-year terms. (d) The enabling resolution may provide that the members of the city council shall serve as the commissioners. (e) The enabling resolution may provide for the appointment of members of the city council in excess of the number required in paragraphs (a), (b), and (c). (f) A vacancy is created in the membership of an authority when a city council member of the authority ends council membership. A vacancy for this or another reason must be filled for the balance of the unexpired term, in the manner in which the original appointment was made. The city council may set the term of the commissioners who are members of the city council to coincide with their term of office as members of the city council. Subd. 3. Increase in commission members. An authority may be increased from three to five or seven members, or from five to seven members by a resolution adopted by the city council following the procedure provided for modifying the enabling resolution in section 469.093. Subd. 4. Compensation and reimbursement. A commissioner, including the president, shall be paid for attending each regular or special meeting of the authority in an amount to be determined by the city council. In addition to receiving pay for meetings, the commissioners may be reimbursed for actual expenses incurred in doing official business of the authority. All money

MINNESOTA STATUTES 2008

110

469.096

paid for compensation or reimbursement must be paid out of the authority's budget. Subd. 5. Removal for cause. A commissioner may be removed by the city council for inefficiency, neglect of duty, or misconduct in office. A commissioner shall be removed only after a hearing. A copy of the charges must be given to the commissioner at least ten days before the hearing. The commissioner must be given an opportunity to be heard in person or by counsel at the hearing. When written charges have been submitted against a commissioner, the city council may temporarily suspend the commissioner. If the city council finds that those charges have not been substantiated, the commissioner shall be immediately reinstated. If a commissioner is removed, a record of the proceedings, together with the charges and findings, shall be filed in the office of the city clerk. History: 1987 c 291 s 96 469.096 OFFICERS; DUTIES; ORGANIZATIONAL MATTERS. Subdivision 1. Bylaws, rules, seal. An authority may adopt bylaws and rules of procedure and shall adopt an official seal. Subd. 2. Officers. An authority shall elect a president, a vice-president, a treasurer, a secretary, and an assistant treasurer. The authority shall elect the president, treasurer, and secretary annually. A commissioner must not serve as president and vice-president at the same time. The other offices may be held by the same commissioner. The offices of secretary and assistant treasurer need not be held by a commissioner. Subd. 3. Duties and powers. The officers have the usual duties and powers of their offices. They may be given other duties and powers by the authority. Subd. 4. Treasurer's duties. The treasurer: (1) shall receive and is responsible for authority money; (2) is responsible for the acts of the assistant treasurer; (3) shall disburse authority money by check only; (4) shall keep an account of the source of all receipts, and the nature, purpose, and authority of all disbursements; and (5) shall file the authority's detailed financial statement with its secretary at least once a year at times set by the authority. Subd. 5. Assistant treasurer. The assistant treasurer has the powers and duties of the treasurer if the treasurer is absent or disabled. Subd. 6. Treasurer's bond. The treasurer shall give bond to the state conditioned for the faithful discharge of official duties. The bond must be approved as to form and surety by the

MINNESOTA STATUTES 2008

111

469.097

authority and filed with the secretary. The bond must be for twice the amount of money likely to be on hand at any one time, as determined at least annually by the authority provided that the bond must not exceed $300,000. Subd. 7. Public money. Authority money is public money. Subd. 8. Checks. An authority check must be signed by the treasurer and one other officer named by the authority in a resolution. The check must state the name of the payee and the nature of the claim that the check is issued for. Subd. 9. Financial statement. The authority's detailed financial statement must show all receipts and disbursements, their nature, the money on hand, the purposes to which the money on hand is to be applied, the authority's credits and assets, and its outstanding liabilities in a form required for the city's financial statements. The authority shall examine the statement together with the treasurer's vouchers. If the authority finds that the statement and vouchers are correct, it shall approve them by resolution and enter the resolution in its records. History: 1987 c 291 s 97 469.097 EMPLOYEES; SERVICES; SUPPLIES. Subdivision 1. Employees. An economic development authority may employ an executive director, a chief engineer, other technical experts and agents, and other employees as it may require, and determine their duties, qualifications, and compensation. Subd. 2. Contract for services. The authority may contract for the services of consultants, agents, public accountants, and other persons needed to perform its duties and exercise its powers. Subd. 3. Legal services. The authority may use the services of the city attorney or hire a general counsel for its legal needs. The city attorney or general counsel, as determined by the authority, is its chief legal advisor. Subd. 4. Supplies. The authority may purchase the supplies and materials it needs to carry out sections 469.090 to 469.108. Subd. 5. City purchasing. An authority may use the facilities of its city's purchasing department in connection with construction work and to purchase equipment, supplies, or materials. Subd. 6. City facilities, services. A city may furnish offices, structures and space, and stenographic, clerical, engineering, or other assistance to its authority. Subd. 7. Delegation power. The authority may delegate to one or more of its agents or employees powers or duties as it may deem proper. History: 1987 c 291 s 98

112

MINNESOTA STATUTES 2008

469.098

469.098 CONFLICT OF INTEREST. Subdivision 1. Disclosure; criminal penalty. (a) Before taking an action or making a decision which could substantially affect the commissioner's or an employee's financial interests or those of an organization with which the commissioner or an employee is associated, a commissioner or employee of an authority shall: (1) prepare a written statement describing the matter requiring action or decision and the nature of the potential conflict of interest; and (2) submit the statement to the commissioners of the authority. (b) The disclosure under paragraph (a) shall be entered upon the minutes of the authority at its next meeting. The disclosure statement must be submitted no later than one week after the employee or commissioner becomes aware of the potential conflict of interest. However, no disclosure statement is required if the effect on the commissioner or employee of the decision or act will be no greater than on other members of the business, profession, or occupation or if the effect on the organization with which the commissioner or employee is affiliated is indirect, remote, and insubstantial. (c) A potential conflict of interest is present if the commissioner or employee knows or has reason to know that the organization with which the commissioner or employee is affiliated is, or is reasonably likely to become, a participant in a project or development which will be affected by the action or decision. (d) Any individual who knowingly fails to submit a statement required by this subdivision or submits a statement which the individual knows contains false information or omits required information is guilty of a misdemeanor. Subd. 2. Effect of disclosure; criminal penalty. (a) If an employee has a potential conflict of interest, the employee's superior shall immediately assign the matter to another employee who does not have a potential conflict of interest. (b) A commissioner who has a potential conflict of interest shall not attempt to influence an employee in any matter related to the action or decision in question, shall not take part in the action or decision, and shall not be counted toward a quorum during the portion of any meeting of the authority in which the action or decision is to be considered. (c) Any individual who knowingly violates this subdivision is guilty of a misdemeanor. Subd. 3. Conflicts forbidden; criminal penalty. A commissioner or employee of an authority who knowingly takes part in any manner in making any sale, lease, or contract in the commissioner's or employee's official capacity in which the commissioner or employee has a personal financial interest is guilty of a misdemeanor.

MINNESOTA STATUTES 2008

113

469.100

Subd. 4. Agent or attorney. For one year after termination of a position as a commissioner or employee of an authority, no former commissioner or former employee of an authority shall appear personally before any court or governmental department or agency as agent or attorney for anyone other than the authority in connection with any proceeding, application, request for ruling or other determination, contract, claim, controversy, charge, accusation, arrest, or other particular matter in which the authority is substantially interested, and with respect to which the commissioner or employee took any action or made any decision as a commissioner or employee of the authority at any time within a period of one year prior to the termination of that position. Subd. 5. Limitations. With respect to each program established by the authority to provide financial assistance or financing for real property other than rental assistance programs, an employee or commissioner may not receive such financial assistance or financing more than once. Subd. 6. Injunction. The county attorney may seek an injunction in the district court to enforce the provisions of this section. Subd. 7. Exceptions. The exceptions in section 471.88 apply to this section. History: 1987 c 291 s 99; 2008 c 197 s 1 469.099 DEPOSITORIES; DEFAULT; COLLATERAL. Subdivision 1. Named; bond. Every two years an authority shall name national or state banks within the state as depositories. Before acting as a depository, a named bank shall give the authority a bond approved as to form and surety by the authority. The bond must be conditioned for the safekeeping and prompt repayment of deposits. The amount of bond must be at least equal to the maximum sums expected to be deposited at any one time. Subd. 2. One bank account. An authority may deposit all its money from any source in one bank account. Subd. 3. Default; collateral. When authority funds are deposited by the treasurer in a bonded depository, the treasurer and the surety on the treasurer's official bond are exempt from liability for the loss of the deposits because of the failure, bankruptcy, or other act or default of the depository. However, an authority may accept assignments of collateral from its depository to secure deposits just as assignments of collateral are permitted by law to secure deposits of the authority's city. History: 1987 c 291 s 100 469.100 OBLIGATIONS. Subdivision 1. Taxes and assessments prohibited. An authority must not levy a tax or special assessment, except as otherwise provided in sections 469.090 to 469.108, pledge the credit

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114

469.101

of the state or the state's municipal corporations or other subdivisions, or incur an obligation enforceable on property not owned by the authority. Subd. 2. Budget to city. Annually, at a time fixed by charter, resolution, or ordinance of the city, an authority shall send its budget to its city's council. The budget must include a detailed written estimate of the amount of money that the authority expects to need from the city to do authority business during the next fiscal year. The needed amount is what is needed in excess of any expected receipts from other sources. Subd. 3. Fiscal year. The fiscal year of the authority must be the same as the fiscal year of its city. Subd. 4. Report to city. Annually, at a time and in a form fixed by the city council, the authority shall make a written report to the council giving a detailed account of its activities and of its receipts and expenditures during the preceding calendar year, together with additional matters and recommendations it deems advisable for the economic development of the city. Subd. 5. Audits. The financial statements of the authority must be prepared, audited, filed, and published or posted in the manner required for the financial statements of the city that established the authority. The financial statements must permit comparison and reconciliation with the city's accounts and financial reports. The report must be filed with the state auditor by June 30 of each year. The auditor shall review the report and may accept it or, in the public interest, audit the books of the authority. Subd. 6. Compliance examinations. At the request of the city or upon the auditor's initiative, the state auditor may make a legal compliance examination of the authority for that city. Each authority examined must pay the total cost of the examination, including the salaries paid to the examiners while actually engaged in making the examination. The state auditor may bill monthly or at the completion of the audit. All collections received must be deposited in the general fund. History: 1987 c 291 s 101; 1989 c 335 art 4 s 88 469.101 POWERS. Subdivision 1. Establishment. An economic development authority may create and define the boundaries of economic development districts at any place or places within the city if the district satisfies the requirements of section 469.174, subdivision 10, except that the district boundaries must be contiguous, and may use the powers granted in sections 469.090 to 469.108 to carry out its purposes. First the authority must hold a public hearing on the matter. At least ten days before the hearing, the authority shall publish notice of the hearing in a daily newspaper of general circulation in the city. Also, the authority shall find that an economic development district

115

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is proper and desirable to establish and develop within the city. Subd. 2. Acquire property. The economic development authority may acquire by lease, purchase, gift, devise, or condemnation proceedings the needed right, title, and interest in property to create economic development districts. It shall pay for the property out of money it receives under sections 469.090 to 469.108. It may hold and dispose of the property subject to the limits and conditions in sections 469.090 to 469.108. The title to property acquired by condemnation or purchase must be in fee simple, absolute. The authority may accept an interest in property acquired in another way subject to any condition of the grantor or donor. The condition must be consistent with the proper use of the property under sections 469.090 to 469.108. Property acquired, owned, leased, controlled, used, or occupied by the authority for any of the purposes of this section is for public governmental and municipal purposes and is exempt from taxation by the state or by its political subdivisions, except to the extent that the property is subject to the sales and use tax under chapter 297A. The exemption applies only while the authority holds property for its own purpose. The exemption is subject to the provisions of section 272.02, subdivision 39. When the property is sold it becomes subject to taxation. Subd. 3. Options. The economic development authority may sign options to purchase, sell, or lease property. Subd. 4. Eminent domain. The economic development authority may exercise the power of eminent domain under chapter 117, or under its city's charter to acquire property it is authorized to acquire by condemnation. The authority may acquire in this way property acquired by its owner by eminent domain or property already devoted to a public use only if its city's council approves. The authority may take possession of property to be condemned after it files a petition in condemnation proceedings describing the property. The authority may abandon the condemnation before taking possession. Subd. 5. Contracts. The economic development authority may make contracts for the purpose of economic development within the powers given it in sections 469.090 to 469.108. The authority may contract or arrange with the federal government, or any of its departments, with persons, public corporations, the state, or any of its political subdivisions, commissions, or agencies, for separate or joint action, on any matter related to using the authority's powers or performing its duties. The authority may contract to purchase and sell real and personal property. An obligation or expense must not be incurred unless existing appropriations together with the reasonably expected revenue of the authority from other sources are sufficient to discharge the obligation or pay the expense when due. The state and its municipal subdivisions are not liable on the obligations. Subd. 5a. Construction contracts. For all contracts for construction, alteration, repair, or maintenance work, the authority may award contracts to the vendor offering the best value, and

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"best value" shall be defined and applied as set forth in sections 16C.02, subdivision 4a, and 16C.28, subdivision 1, paragraph (a), clause (2), and paragraph (c). Alternatively, the authority may award all contracts for construction, alteration, repair, or maintenance work to the lowest responsible bidder, reserving the right to reject any or all bids. Subd. 6. Limited partner. The economic development authority may be a limited partner in a partnership whose purpose is consistent with the authority's purpose. Subd. 7. Rights; easements. The economic development authority may acquire rights or an easement for a term of years or perpetually for development of an economic development district. Subd. 8. Supplies; materials. The economic development authority may buy the supplies and materials it needs to carry out this section. Subd. 9. Receive public property. The economic development authority may accept land, money, or other assistance, whether by gift, loan or otherwise, in any form from the federal or state government, or an agency of either, or a local subdivision of state government to carry out sections 469.090 to 469.108 and to acquire and develop an economic development district and its facilities under this section. Subd. 10. Development district authority. The economic development authority may sell or lease land held by it for economic development in economic development districts. The authority may acquire, sell, or lease single or multiple tracts of land regardless of size, to be developed as a part of the economic development of the district under sections 469.090 to 469.108. Subd. 11. Foreign trade zone. The economic development authority may apply to the board defined in United States Code, title 19, section 81a, for the right to use the powers provided in United States Code, title 19, sections 81a to 81u. If the right is granted, the authority may use the powers. One authority may apply with another authority. Subd. 12. Relation to other redevelopment powers. The economic development authority may exercise powers and duties of a redevelopment agency under sections 469.152 to 469.165, for a purpose in sections 469.001 to 469.047 or 469.090 to 469.108. The authority may also use the powers and duties in sections 469.001 to 469.047 and 469.090 to 469.108 for a purpose in sections 469.152 to 469.165. Subd. 13. Public facilities. The authority may operate and maintain a public parking facility or other public facility to promote development in an economic development district. Subd. 14. Government agent. An economic development authority may cooperate with or act as agent for the federal or the state government, or a state public body, or an agency or instrumentality of a government or a public body to carry out sections 469.090 to 469.108 or any other related federal, state, or local law in the area of economic development district improvement.

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Subd. 15. Studies, analysis, research. An authority may study and analyze economic development needs in the city, and ways to meet the needs. An authority may study the desirable patterns for land use for economic development and community growth and other factors affecting local economic development in the city and make the result of the studies available to the public and to industry in general. An authority may engage in research and disseminate information on economic development within the city. Subd. 16. Public relations. To further an authorized purpose, an authority may (1) join an official, industrial, commercial, or trade association, or another organization concerned with the purpose, (2) have a reception of officials who may contribute to advancing the city and its economic development, and (3) carry out other public relations activities to promote the city and its economic development. Activities under this subdivision have a public purpose. Subd. 17. Accept public land. An authority may accept conveyances of land from all other public agencies, commissions, or other units of government, if the land can be properly used by the authority in an economic development district, to carry out the purposes of sections 469.090 to 469.108. Subd. 18. Economic development. An authority may carry out the law on economic development districts to develop and improve the lands in an economic development district to make it suitable and available for economic development uses and purposes. An authority may fill, grade, and protect the property and do anything necessary and expedient, after acquiring the property, to make it suitable and attractive as a tract for economic development. An authority may lease some or all of its lands or property and may set up local improvement districts in all or part of an economic development district. Subd. 19. Loans in anticipation of bonds. After authorizing bonds under sections 469.102 and 469.103, an authority may borrow to provide money immediately required for the bond purpose. The loans must not exceed the amount of the bonds. The authority shall by resolution decide the terms of the loans. The loans must be evidenced by negotiable notes due in not more than 12 months from the date of the loan payable to the order of the lender or to bearer, to be repaid with interest from the proceeds of the bonds when the bonds are issued and delivered to the bond purchasers. The loan must not be obtained from any commissioner of the authority or from any corporation, association, or other institution of which an authority commissioner is a stockholder or officer. Subd. 20. Use of proceeds. The proceeds of obligations issued by an authority under section 469.103 and temporary loans obtained under subdivision 19 may be used to make or purchase loans for economic development facilities that the authority believes will require financing. To make or purchase the loans, the authority may enter into loan and related agreements, both before and after issuing the obligations, with persons, firms, public or private corporations, federal

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or state agencies, and governmental units under terms and conditions the authority considers appropriate. A governmental unit in the state may apply, contract for, and receive the loans. Chapter 475 does not apply to the loans. Subd. 21. [Repealed, 2000 c 490 art 11 s 44] Subd. 22. Secondary market. An authority may sell, at private or public sale, at the price or prices determined by the authority, any note, mortgage, lease, sublease, lease purchase, or other instrument or obligation evidencing or securing a loan made for the purpose of economic development, job creation, redevelopment, or community revitalization by a public agency to a business, for-profit or nonprofit organization, or an individual. Subd. 23. Supplying small business capital. Notwithstanding any contrary law, the authority may participate with public or private corporations or other entities, whose purpose is to provide seed or venture capital to small businesses that have facilities located or to be located in the district. For that purpose the authority may use not more than ten percent of available annual net income or $1,000,000 annually, whichever is less, to invest in equities or acquire equity-type investments. These investments can be made directly in eligible corporations or entities or acquired through participation in a public or private seed or venture capital fund. The participation by the authority may not exceed in any year 25 percent of the total amount of funds provided for venture or seed capital purposes by all of the participants. The corporation, entity, or fund shall report in writing each six months to the commissioners of the authority all investments and other action taken by it since the last report. Funds contributed to the corporation or entity must be invested pro rata with each contributor of capital taking proportional risks on each investment. As used in this subdivision, the term "small business" has the meaning given it in section 645.445, subdivision 2. History: 1987 c 291 s 102; 1988 c 580 s 5; 1991 c 295 s 2; 1992 c 363 art 1 s 13; 2000 c 418 art 2 s 7; 2006 c 214 s 20; 2007 c 148 art 3 s 30 469.102 GENERAL OBLIGATION BONDS. Subdivision 1. Authority; procedure. An economic development authority may issue general obligation bonds in the principal amount authorized by two-thirds majority vote of its city's council. The bonds may be issued in anticipation of income from any source. The bonds may be issued: (1) to secure funds needed by the authority to pay for acquired property or (2) for other purposes in sections 469.090 to 469.108. The bonds must be in the amount and form and bear interest at the rate set by the city council. Except as otherwise provided in sections 469.090 to 469.108, the issuance of the bonds is governed by chapter 475. The authority when issuing the bonds is a municipal corporation under chapter 475. Subd. 2. Detail; maturity. The authority with the consent of its city's council shall set the

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date, denominations, place of payment, form, and details of the bonds. The bonds must mature serially. The first installment is due in not more than three years and the last in not more than 30 years from the date of issuance. Subd. 3. Signatures; coupons; liability. The bonds must be signed by the president of the authority, be attested by its secretary, and be countersigned by its treasurer; the signatures may be facsimile signatures. The interest coupons if any, must be attached to the bonds. The coupons must be executed and authenticated by the printed, engrossed, or lithographed facsimile signature of the authority's president and secretary. The bonds do not impose any personal liability on a member of the authority. Subd. 4. Pledge. The bonds must be secured by the pledge of the full faith, credit, and resources of the issuing authority's city. The authority may pledge the full faith, credit, and resources of the city only if the city specifically authorizes the authority to do so. The city council must first decide whether the issuance of the bonds by the authority is proper in each case and if so, the amount of bonds to issue. The city council shall give specific consent in an ordinance to the pledge of the city's full faith, credit, and resources. The authority shall pay the principal amount of the bonds and the interest on it from taxes levied under this section to make the payment or from authority income from any source. Subd. 5. Tax levy. An authority that issues bonds under this section, shall, before issuing them, levy a tax for each year on the taxable property in the authority's city. The tax must be for at least five percent more than the amount required to pay the principal and interest on the bonds as the principal and interest mature. The tax must be levied annually until the principal and interest are paid in full. After the bonds have been delivered to the purchasers, the tax must not be repealed until the debt is paid. After the bonds are issued, the authority need not take any more action to authorize extending, assessing, and collecting the tax. On or before September 15, the authority's secretary shall send a certified copy of the levy to the county auditor, together with full information on the bonds for which the tax is levied. The county auditor shall extend and assess the levied tax annually until the principal and interest are paid in full. The authority shall transfer the surplus from the excess levy in this section to a sinking fund after the principal and interest for which the tax was levied and collected is paid. The authority may direct its secretary to send a certificate to the county auditor before September 15 in a year. The certificate must state how much available income, including the amount in the sinking fund, the authority will use to pay principal or interest or both on each specified issue of the authority's bonds. The auditor shall then reduce the bond levy for that year by that amount. The authority shall then set aside the certified amount and may not use it for any purpose except to pay the principal and interest on the bonds. The taxes in this section shall be collected and sent to the authority by the county treasurer as provided in chapter 276. The taxes must be used only to pay the bonds when due.

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Subd. 6. Authorized securities. Bonds legally issued under this chapter are authorized securities under section 50.14. A savings bank, trust company, or insurance company may invest in them. A public or municipal corporation may invest its sinking funds in them. The bonds may be pledged by a bank or trust company as security for the deposit of public money in place of a surety bond. The authority's bonds are instrumentalities of a public governmental agency. History: 1987 c 291 s 103; 1994 c 416 art 1 s 49; 1995 c 256 s 9; 2002 c 390 s 8 469.103 REVENUE BONDS; PLEDGE; COVENANTS. Subdivision 1. Authority. An economic development authority may decide by resolution to issue its revenue bonds either at one time or in series from time to time. The revenue bonds may be issued to provide money to pay to acquire land needed to operate the authority, to purchase or construct facilities, to purchase, construct, install, or furnish capital equipment to operate a facility for economic development of any kind within the city, or to pay to extend, enlarge, or improve a project under its control. The issued bonds may include the amount the authority considers necessary to establish an initial reserve to pay principal and interest on the bonds. The authority shall state in a resolution how the bonds and their attached interest coupons are to be executed. Subd. 2. Form. The bonds of each series issued by the authority under this section shall bear interest at a rate or rates, shall mature at the time or times within 30 years from the date of issuance, and shall be in the form, whether payable to bearer, registrable as to principal, or fully registrable, as determined by the authority. Section 469.102, subdivision 6, applies to all bonds issued under this section, and the bonds and their coupons, if any, when payable to bearer, shall be negotiable instruments. Subd. 3. Sale. The sale of revenue bonds issued by the authority shall be at public or private sale. The bonds may be sold in the manner and for the price that the authority determines to be for the best interest of the authority. The bonds may be made callable, and if so issued, may be refunded. Subd. 4. Agreements. The authority may by resolution make an agreement or covenant with the bondholders or their trustee. The authority must first decide that the agreement or covenant is needed or desirable to do what the authority may do under this section and to assure that the revenue bonds are marketable and promptly paid. Subd. 5. Revenue pledge. In issuing general obligation or revenue bonds, the authority may secure the payment of the principal and the interest on the bonds by a pledge of and lien on authority revenue. The revenue must come from the facility to be acquired, constructed, or improved with the bond proceeds or from other facilities named in the bond-authorizing resolutions. The authority also may secure the payment with its promise to impose, maintain,

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and collect enough rentals, rates, and charges, for the use and occupancy of the facilities and for services furnished in connection with the use and occupancy, to pay its current expenses to operate and maintain the named facilities, and to produce and deposit sufficient net revenue in a special fund to meet the interest and principal requirements of the bonds, and to collect and keep any more money required by the resolutions. The authority shall decide what constitutes "current expense" under this subdivision based on what is normal and reasonable under generally accepted accounting principles. Revenues pledged by the authority must not be used or pledged for any other authority purpose or to pay any other bonds issued under this section or under section 469.102, unless the other use or pledge is specifically authorized in the bond-authorizing resolutions. Subd. 6. Not city debt. Revenue bonds issued under this section are not a debt of the authority's city nor a pledge of that city's full faith and credit. The bonds are payable only from project revenue as described in this section. A revenue bond must contain on its face a statement to the effect that the economic development authority and its city do not have to pay the bond or the interest on it except from revenue and that the faith, credit, and taxing power of the city are not pledged to pay the principal of or the interest on the bond. Subd. 7. Not applicable. Sections 469.153, subdivision 2, paragraph (e), and 469.154, subdivisions 3, 4, and 5 do not apply to revenue bonds issued under this section and sections 469.152 to 469.165 if the interest on the revenue bonds is subject to both state and federal income tax or if the revenue bond proceeds are not loaned by the authority to a private person. Subd. 8. Tax increment bonds. Obligations secured or payable from tax increment revenues and issued pursuant to this section or section 469.102 are subject to the provisions of section 469.178. History: 1987 c 291 s 104; 2006 c 259 art 9 s 8 469.104 SECTIONS THAT APPLY IF FEDERAL LIMIT APPLIES. Sections 474A.01 to 474A.21 apply to obligations issued under sections 469.090 to 469.108 that are limited by federal tax law as defined in section 474A.02, subdivision 8. History: 1987 c 291 s 105; 2005 c 10 art 1 s 71 469.105 SALE OF PROPERTY. Subdivision 1. Power. An economic development authority may sell and convey property owned by it within the city or an economic development district if it determines that the sale and conveyance are in the best interests of the city or district and its people, and that the transaction furthers its general plan of economic development. This section is not limited by other law on powers of economic development authorities.

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Subd. 2. Notice; hearing. An authority shall hold a hearing on the sale. At the hearing a taxpayer may testify for or against the sale. At least ten, but not more than 20, days before the hearing the authority shall publish notice of the hearing on the proposed sale in a newspaper. The newspaper must be published and have general circulation in the authority's county and city. The notice must describe the property to be sold and state the time and place of the hearing. The notice must also state that the public may see the terms and conditions of the sale at the authority's office and that at the hearing the authority will meet to decide if the sale is advisable. Subd. 3. Decision; appeal. The authority shall make its findings and decision on whether the sale is advisable and enter its decision on its records within 30 days of the hearing. A taxpayer may appeal the decision by filing a notice of appeal with the district court in the city or economic development district's county and serving the notice on the secretary of the authority, within 20 days after the decision is entered. The only ground for appeal is that the action of the authority was arbitrary, capricious, or contrary to law. Subd. 4. Terms. The terms and conditions of sale of the property must include the use that the bidder will be allowed to make of it. The authority may require the purchaser to file security to assure that the property will be given that use. In deciding the sale terms and conditions the authority may consider the nature of the proposed use and the relation of the use to the improvement of the authority's city and the business and the facilities of the authority in general. The sale must be made on the authority's terms and conditions. The authority may publish an advertisement for bids on the property at the same time and in the same manner as the notice of hearing required in this section. The authority may award the sale to the bid considered by it to be most favorable considering the price and the specified intended use. The authority may also sell the property at private sale at a negotiated price if after its hearing the authority considers that sale to be in the public interest and to further the aims and purposes of sections 469.090 to 469.108. Subd. 5. One-year deadline. Within one year from the date of purchase, the purchaser shall devote the property to its intended use or begin work on the improvements to the property to devote it to that use. If the purchaser fails to do so, the authority may cancel the sale and title to the property shall return to it. The authority may extend the time to comply with a condition if the purchaser has good cause. The terms of sale may contain other provisions that the authority considers necessary and proper to protect the public interest. A purchaser must not transfer title to the property within one year of purchase without the consent of the authority. Subd. 6. Covenant running with the land. A sale made under this section must incorporate in the deed as a covenant running with the land the conditions of sections 469.090 to 469.108 relating to the use of the land. If the covenant is violated the authority may declare a breach of the covenant and seek a judicial decree from the district court declaring a forfeiture and a cancellation of the deed.

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Subd. 7. Plans; specifications. A conveyance must not be made until the purchaser gives the authority plans and specifications to develop the property sold. The authority must approve the plans and specifications in writing. The authority may require preparation of final plans and specifications before the hearing on the sale. History: 1987 c 291 s 106 469.106 ADVANCES BY AUTHORITY. An authority may advance its general fund money or its credit, or both, without interest, for the objects and purposes of sections 469.090 to 469.108. The advances must be repaid from the sale or lease, or both, of developed or redeveloped lands. If the money advanced for the development or redevelopment was obtained from the sale of the authority's general obligation bonds, then the advances must have not less than the average annual interest rate that is on the authority's general obligation bonds that are outstanding at the time the advances are made. The authority may advance repaid money for more objects and purposes of sections 469.090 to 469.108 subject to repayment in the same manner. The authority must still use rentals of lands acquired with advanced money to collect and maintain reserves to secure the payment of principal and interest on revenue bonds issued to finance economic development facilities, if the rentals have been pledged for that purpose under section 469.103. Advances made to acquire lands and to construct facilities for recreation purposes if authorized by law need not be reimbursed under this section. Sections 469.090 to 469.108 do not exempt lands leased from the authority to a private person, or entity from assessments or taxes against the leased property while the lessee is liable for the assessments or taxes under the lease. History: 1987 c 291 s 107 469.107 CITY MAY LEVY TAXES FOR ECONOMIC DEVELOPMENT AUTHORITY. Subdivision 1. City tax levy. A city may, at the request of the authority, levy a tax in any year for the benefit of the authority. The tax must be not more than 0.01813 percent of taxable market value. The amount levied must be paid by the city treasurer to the treasurer of the authority, to be spent by the authority. Subd. 2. Reverse referendum. A city may increase its levy for economic development authority purposes under subdivision 1 in the following way. Its city council must first pass a resolution stating the proposed amount of levy increase. The city must then publish the resolution together with a notice of public hearing on the resolution for two successive weeks in its official newspaper or if none exists in a newspaper of general circulation in the city. The hearing must be held two to four weeks after the first publication. After the hearing, the city council may decide to take no action or may adopt a resolution authorizing the proposed increase or a lesser increase. A resolution authorizing an increase must be published in the city's official newspaper or

MINNESOTA STATUTES 2008

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if none exists in a newspaper of general circulation in the city. The resolution is not effective if a petition requesting a referendum on the resolution is filed with the city clerk within 30 days of publication of the resolution. The petition must be signed by voters equaling five percent of the votes cast in the city in the last general election. The election must be held at a general or special election. Notice of the election must be given in the manner required by law. The notice must state the purpose and amount of the levy. History: 1987 c 291 s 108; 1988 c 719 art 5 s 84; 1989 c 277 art 4 s 64; 1992 c 511 art 5 s 13 469.108 SPECIAL LAW; OPTIONAL USE. A city that has established a port authority by special law or that has been granted the power to establish a port authority by special law, or a city whose city council has been authorized to exercise the powers of a port authority by special law may elect to use the powers granted in sections 469.090 to 469.108. If the election is made, the powers and duties set forth in sections 469.090 to 469.108 supersede the special law and the special law must not be used after the election. The use of powers under sections 469.090 to 469.108 by a city described in this section does not impair the security of any obligations issued or contracts or agreements executed under the special law. Control, authority, and operation of any project may be transferred to the authority in the manner provided in section 469.094. History: 1987 c 291 s 109 469.1081 LIABLE IN CONTRACT OR TORT. Subject to the provisions of chapter 466, an authority shall be liable in contract or in tort in the same manner as a private corporation. The commissioners of an authority shall not be personally liable as such on its contracts, or for torts, not committed or directly authorized by them. The property or funds of an authority shall not be subject to attachment, or to levy and sale on execution, but, if an authority refuses to pay a judgment entered against it in any court of competent jurisdiction, the district court for the county in which the authority is situated may, by writ of mandamus, direct the treasurer of the authority to pay the judgment from any unencumbered funds available for that purpose. History: 1991 c 342 s 13 469.1082 COUNTY ECONOMIC DEVELOPMENT AUTHORITY OR HOUSING AND REDEVELOPMENT AUTHORITY WITH ECONOMIC DEVELOPMENT POWERS. Subdivision 1. Authority to create. A county may form a county economic development authority or grant a housing and redevelopment authority the powers specified in subdivision 4, clause (2), if it receives a recommendation to do so from a committee formed under subdivision 2.

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An economic development authority established under this section has all the powers and rights of an authority under sections 469.090 to 469.1081, except the authority granted under section 469.094 if so limited under subdivision 4. This section is in addition to any other authority to create a county economic development authority or service provider. Nothing in this section shall alter or impair any grant of powers, or any other authority granted to a community development agency, a county housing and redevelopment authority, or any county as provided in section 383D.41; Laws 1974, chapter 473, as amended; or Laws 1980, chapter 482, as amended. Any county that has granted economic development powers to a community development agency or a county housing and redevelopment authority under any of these provisions may not form a county economic development authority or grant a housing and redevelopment authority the powers specified in subdivision 4, clause (2). Subd. 2. Local committees. Upon notice to all local government units and development agencies within the county, a county may adopt a resolution to create a committee to recommend options for a county economic development service provider. The committee shall consist of no fewer than 11 and no more than 15 members appointed by the county board. At least one city official, at least one housing and redevelopment official, and at least one township official from the county to be served by the county economic service provider shall be included on the committee. Members may also represent school districts, political subdivisions that currently provide services under sections 469.001 to 469.047 and 469.090 to 469.1081, nonprofit or for-profit housing and economic development organizations, business, and labor organizations located within the county. Political subdivision representatives must be selected by their local governments and must constitute at least 50 percent of the total committee membership. The county may appoint no more than two county commissioners. The committee shall select a chair at its initial meeting. Subd. 3. Committee report. The committee shall issue its report within 90 days of its initial meeting. The committee may request one 60-day extension from the county board. The report must contain the committee's recommendation for the preferred organizational option for a county economic development service provider, including the distance from the boundary of the city that may be controlled by each affected city in subdivision 5. The distance may not exceed two miles from the city boundary. The report must contain written findings on issues considered by the committee including, but not limited to, the following: (1) identification of the current level of economic development, housing, and community development programs and services provided by existing agencies, any existing gaps in programs and services, and the capacity and ability of those agencies to expand their activities; and (2) the recommended organizational option for providing needed economic development, housing, and community development services in the most efficient, effective manner.

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Subd. 4. Organizational options. The committee may only recommend: (1) establishment of a county economic development authority to operate under sections 469.090 to 469.1081, except that the county shall not have the powers of section 469.094 without the consent of an existing county housing and redevelopment authority operating within that county. For the purposes of a county economic development authority's operation, the county is considered to be the city and the county board is considered to be the city council; (2) requiring an existing county housing and redevelopment authority or multicounty housing and redevelopment authority to operate under sections 469.090 to 469.1081; (3) that the county pursue special legislation; or (4) no change in the existing structure. Subd. 5. Area of operation. The area of operation of a county economic development service provider created under this section shall include all cities within a county that have adopted resolutions electing to participate. A city may adopt a resolution electing to withdraw participation. The withdrawal election may be made every fifth year following adoption of the resolution electing participation. The withdrawal election is effective on the anniversary date of the original resolution provided notice is given to the county economic development authority not less than 90 nor more than 180 days prior to that anniversary date. The city electing to withdraw retains any rights, obligations, and liabilities it obtained or incurred during its participation. Any city within the county shall have the option to adopt a resolution to prohibit the county economic development service provider created under this section from operating within its boundaries and (1) within an agreed upon urban service area, or (2) within the distance approved in the committee report referenced in subdivision 3. If a city prohibits a county economic development service provider created under this section from operating within its boundaries, the city's property taxpayers shall not be subject to the property tax levied for the county economic development service provider. Subd. 6. City economic development authorities. If a county economic development service provider has been established under this section, existing city economic development authorities shall continue to function and operate under sections 469.090 to 469.1081. Additional city economic development authorities may be created within the area of operation of the county economic development service provider created under this section without the explicit concurrence of the county economic development service provider. Subd. 7. Continuation of existing county and multicounty housing and redevelopment authorities. Existing county and multicounty housing and redevelopment authorities shall continue to function and operate under the provisions of sections 469.001 to 469.047. Subd. 8. Nine-member boards authorized. In addition to the board options under

Miscellaneous

Section 14

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Economic Development Authority