EDA Meeting Minutes - 11/06/2024 (Workshop)MINUTES
WORKSHOP - ECONOMIC DEVELOPMENT AUTHORITY (EDA)
Wednesday, November 6, 2024 — 5:00 p.m.
Academy Room, Monticello Community Center
Commissioners Present: President Steve Johnson, Treasurer Hali Sittig,
011ie Koropchak-White, Rick Barger and Councilmembers Lloyd Hilgart and
Tracy Hinz
Commissioners Absent: Vice President Jon Morphew
Staff: Executive Director Jim Thares, Angela Schumann, Tyler Bevier
1. Call to order: 5:00 p.m.
2. Roll Call
3. Block 34 Redevelopment Evaluation Framework - Review and Discussion
Economic Development Manager Jim Thares introduced Angela Schumann,
Community Development Director, to lead the Block 34 redevelopment evaluation
framework review and discussion. Ms. Schumann began her presentation by stating
staff released an RFP for Block 34 redevelopment. The goal of the RFP is to mirror
development as illustrated in the 2017 Small Area Downtown Area Plan, with
buildings at the four corners of Block 34. The Plan also shifts the center of
downtown to Walnut and Broadway, though it recognizes that Cedar is intended to
be a street similar to Walnut Street. The Plan intends to bring access to the parks
and the downtown.
The EDA is reviewing large, small and medium-sized investments. While the largest
investment Downtown is Block 52, the EDA has also been involved in smaller ones
such as the facade program and will continue to make small improvements.
The Downtown Improvement Plan also intends to bring the community back to
being a River Town.
Ms. Schumann continued, stating when surveying the Public, they wanted to also
see the development of Block 34. Considerations include the building architecture,
public uses as well as structure locations and types.
In recent City Council and EDA discussions, Block 34 redevelopment was noted as a
In recent City Council and EDA discussions, Block 34 redevelopment was noted as a
priority. Those discussions focused on the land, various uses and density options as
well as the timeline.
EDA asked staff to reach out to developers and also with local businesses to
regarding potential conceptual ideas and realistic goals. Two of the developers are
present to present their proposals. Ms. Schumann stated that the intent of the
workshop is to discuss the proposals and get EDA direction on next steps.
Ms. Schumann led the EDA through an exercise to induce discussion about the
relative goals for down.
• What do you hope to accomplish on this block relative to the goals for
downtown?
• How does this proposal support a larger Downtown revitalization?
• What is important to communicate to the development partner and
community about the redevelopment of this block?
• How do proposals concepts relate to the existing Downtown landscape and
surrounding uses in the area?
• What details of the proposals require mor discussion?
• Do the presented projects seem feasible?
• What is the timeline for development?
• What type of public input would you like?
• Other considerations.
Chair Steve Johnson stated the EDA will need to consider the intensity of the use as
it is the center of the city, and it is a less than desirable use of that spot. The EDA has
a once in a lifetime opportunity for development Block 34 and needs to consider the
right intensity for the block.
Mayor Lloyd Hilgart feels that the type of use mix is important and continues what
was developed on Block 52. The mix of uses to bring citizens there during the day
every day and every evening.
Council Member Tracy Hinz states this creates an opportunity to capitalize on
retention since the EDA does not own all of the Block 34 land.
Commissioner Olie Koropchak-White stated connecting Downtown to the River is an
important part of revitalizing this area for pedestrians.
Mr. Johnson feels that it is important to augment the use of Pine Street and
Broadway to be more pedestrian friendly. They are currently an impediment to foot
traffic.
Mr. Johnson pointed out the importance of the safety crosswalks and flashing lights
provided for pedestrians related to a recent downtown community event and
suggested another be added at the intersection of E Broadway and Cedar Street. He
feels these types of improvement would entice pedestrians and development on
Block 34.
Commissioner Jon Morphew stated the EDA has to work within the confines of
property neither the City nor EDA own.
Ms. Schumann asked if the EDA felt developers and businesses know what they
know about the block.
Mr. Hilgart stated he feels the developers and potential businesses are aware of the
wells on this property.
Mr. Johnson inquired about what the City's plans are for the wells.
Ms. Schumann addressed this question stating City Council authorized soil testing to
evaluate potential locations to move the wells to see if there is a possibility of doing
so.
Mr. Johnson asked if the well could be incorporated into underground parking and
that he feels parking will be an issue for intense development.
Commissioner Hali Sittig stated she would like to see the architecture and
development to provide a continued feel of downtown... coinciding with Block 52,
not mirroring Block 52. Ms. Sittig expressed she would like to see green space on
Block 34.
Ms. Schumann asked what the EDA feels would bring citizens downtown.
Mr. Johnson stated he feels convenience type of retail (not convenience stores) as
well as offices. Each brings different parking needs and entrance/exits traffic.
Ms. Schumann asked what type of convenience stores Mr. Johnson is thinking about.
He stated coffee shops, places selling goods and is concerned with parking.
It was a consensus that being able to access one parking area to the next is
important.
Ms. Sittig expressed the ease and new improved safety features built into Broadway
provide the ease of parking across the street and has created additional pedestrian
traffic.
Ms. Schumann asked what the importance of developing Block 34 is to downtown
revitalization.
Mr. Morphew stated this will bring additional people downtown.
Mr. Barger feels a mix uses will be important. Ms. Sittig said having community
activities would help bring citizens to the area.
Ms. Hinz stated that Block 34 currently is a detractor whereas Block 52 is attractor.
Mr. Johnson stated parking with a mix of pedestrians and office employees could be
a problem.
Ms. Schumann asked if after looking at the proposals, is there anything the EDA
would like to focus on.
Mr. Barger said the intent to bring down the current apartment building should be a
focus.
Mr. Johnson stated that with the intensity of a developer buying the property and be
able to do something with it the EDA has to consider the return on their investment.
Mr. Johnson, Ms. Sittig, and Mr. Barger expressed their agreement.
Ms. Schuman asked the EDA how important it is to them to recover their investment
should all of their other goals be met and what are the nonnegotiable.
Mr. Morphew addressed the first question stating it may depend on how far the gap
is. Mr. Barger agreed. Mr. Johnson suggested that it could depend on who the
investment has helped.
Mr. Morphew stated we will know it when we see it.
Ms. Hinz stated she does not recall that the EDA has not routinely supported a
project with a firm thought that we need to get our investment back and that the
EDA is all on the same page is most important.
Ms. Sittig stated the mission of the EDA is not to make money but rather revitalize
the community with economic growth and being thoughtful in their decisions where
to invest. Investing in revitalizing is the goal.
Mr. Johnson stated the long-term goal is to reinvest in the future.
Mr. Hilgart noted that redevelopment is expensive and requires subsidy.
Mr. Hilgart addressed the wells and underground car park. He feels underground
parking is a necessity, however, research will need to be done on how the wells
could fit into this. Moving the wells will be expensive.
The land the EDA doesn't have control over is like Block 52. There was also a sliver of
land not owned by the EDA/City. We know we can develop with this situation.
Mr. Hilgart stated that if the EDA is concerned about money than putting an
apartment building on the property may not provide the desired return. He agreed
that "we will know it when we see it."
Mr. Johnson stated if a developer wants to come in, the EDA will need to price the
property to help make it possible. The goal is it fits a public purpose.
Mr. Hilgart stated there is no way to know the total impact of Block 52, however, we
know that when Beef o Brady's was built with the apartments, the businesses felt a
positive impact.
Mr. Johnson stated this is an example of the parking balance between business and
retail space.
Ms. Schumann shared staff work with businesses on ensuring they have adequate
parking.
Mr. Hilgart shared when he was at Block 52 the prior week, they were finishing the
parking. He stated the parking lot is 70-80% full during the day because of the offices
downtown. Because they were finishing the parking lot no cars were parked there.
All of the spots on River and Walnut were taken showing all of these excess parking
was within 2 blocks.
Ms. Schumann stated at a prior meeting, Commissioner Barger asked do we want
businesses....or parking. Staff addressed the city -created companion parking on
Block 51 to accommodate the Block 52 parking and created parking on River,
reconfigured the parking from Walnut to Locust. She suggests directing staff to
investigate where additional parking can be done for Block 34.
Ms. Schumann shared that in the early stages of developing Block 52 the city hosted
downtown rounds showing drawings of proposals for citizens to review. Business
and property owners were able to mark up the drawing and their input is a direct
result of what we see on Block 52. She noted we have not done that in depth
community engagement on Block 34. Ms. Schumann asked the EDA where they
want staff to take community engagement on the redevelopment of Block 34. She
stated that staff can present a plan but asked if they have any input.
Mr. Johnson stated that asking for community input from people outside of
downtown would help everyone understand what will attract them.
Mr. Morphew stated that if this is done it should be a big picture vision, not specific
induvial uses but how the block is used. He is not opposed to public involvement but
does not feel it is a prerequisite.
Mr. Hilgart stated the market will show what it needs to be.
Ms. Schumann gave a couple of examples of questions that would be posed to the
public. Mr. Morphew agreed that those types of questions would be good questions.
Ms. Hinz pointed out the timing of this development is so different than when we
started in 2017.
Ms. Sittig stated that she participated in all the Downtown Rounds before she
became an EDA Commissioner. She feels once Block 52 was built it became a
reminder to the public that this was their vision. She does not feel outreach is
necessary. Ms. Schumann suggested ways to reach the public like community events
(Walk and Roll, Trick Treat) and dot events. Another suggestion is to reach out to
specifically the businesses and property owners near Block 34.
Ms. Sittig asked if Block 52 would look different if there weren't Downtown Rounds.
Ms. Schumann and Mr. Thares felt it would.
Mr. Johnson pointed out that several of the businesses who attended the
Downtown Rounds are no longer there and that Block 52 is completely occupied.
Mr. Morphew suggested the time lag of community input to completion of a project
is a factor in community outreach.
Ms. Hinz stated she felt there community involvement fatigue which the EDA needs
to consider.
Staff don't want to miss the mark of the EDA's expectations because there are
developers with proposals. Staff want to ensure we know what your expectations
are in reaching out to the public.
Mr. Morphew would not support general public outreach, but the big picture input
would be ok.
Ms. Schumann suggested instead of outreach and asking what the community wants
but instead telling them what we are doing.
Ms. Schumann suggested a study of what would bring visitors downtown, a similar
study that was done for the Local Option Sales Tax for BCOL.
Mr. Hilgart suggested asking downtown businesses if they have noticed a difference
from the building of Block 52.
Ms. Sittig stated she sees foot traffic on the west side of Hwy 25 going across the
road but not on the east side.
Mr. Barger inquired if she thought Hwy 25 was a barrier, Ms. Sittig said she did not
feel it was.
Mr. Barger listed several successful downtown River town areas; Red Wing, Hastings,
Wabasha, Hopkins, their downtown areas are walkable. Parking is available off
street and walk. He feels Hwy 25 is a barrier.
Mr. Johnson suggested the Parks are a destination for downtown.
4. Interview -Discussion -Krause -Anderson Development Block 34 RFI Submittal
Mr. Thares introduced Stefan Michno, Director of Development for Kraus -Anderson.
For transparency, Mr. Thares introduced Charles Burdick, President of Streetfront
Development, another developer who is presenting this evening.
Mr. Michno gave an overview of Kraus -Anderson's history and experience. They
have all of the resources to be a "one stop shop."
Their vision for Block 34 to be a place people want to work but also spend time.
To get the best value of the site would be to move the wells or create a structure
around them like underground parking.
Phase one would be an office component on pine street with surface parking
solution.
Phase 2 is concentrating on office over retail or a housing. Kraus -Anderson may be
interested in purchasing the apartment building at fair market value.
Mr. Michno shared a vision of mixed use, being able to work in a place where you
can go downstairs to a coffee shop or other small retailers, and green spaces with
potential patio areas. He addressed their plans for employee and retail parking, and
green space.
Mr. Michno presented illustrations of what Block 34 could look like. They would
create an area which doesn't stand out but blends with the feel of the community.
Mr. Johnson suggested that a positive for apartments would be underground
parking.
Mr. Hilgart stated this isn't proposing residential. Mr. Michno stated if Kraus -
Anderson was not able to get business office commitments then they would look
into residential.
Ms. Sittig shared she felt that the phasing would fit into the site without
overstepping.
Mr. Johnson asked if the parking ramp is only partially underground. Mr. Michno
addressed that there would be an underground parking ramp with the top level at
grade level.
Mr. Hilgart confirmed with Mr. Michno that the employee parking would be
underground, and public and retail parking would be on the main.
Mr. Barger inquired if the underground parking space is sufficient for retail
employee parking. Mr. Michno said it would be determined at a later time.
Mr. Johnson gave an example of parking in a St. louis Park area where the street
parking is tight but there is underground parking so you can park under the retail
you want to go to.
Ms. Hinz asked if Kraus -Anderson could talk about another project they are working
on, similar to Block 34.
Mr. Michno shared the West Transit Village project they have been working on in
Rochester for 2 years. Building public spaces, green spaces and parking.
Ms. Sittig inquired with Block 52 not populated would they be able to bring in
retailers or do they hope businesses would come. Mr. Michno stated they would
work with the city in hopes of obtaining commitments.
Ms. Sittig shared that Monticello has a unique opportunity right now as we have
experienced growth and are able to support those convenience businesses like
Chipotle, Panera, and Starbucks. Since these businesses have moved to Monticello,
it may attract more retailers who would like an area like Block 34.
Mr. Johnson stated that the concept could change.
5. Interview -Discussion -Street front Development Block 34 RFI Submittal
Mr. Burdick shared Streetfront's vision for Block 34.
Streetfront's proposal includes office space, mixed use, 24-unit apartments and 20
town homes.
Mr. Hilgart confirmed the existing building would stay in place.
Mr. Hilgart confirmed the wells would remain where they are.
Mr. Johnson asked if there is a residential demand within the city. Mr. Burdick said
he believes so. The proposal has mixed income level housing, supporting 60% and
80%.
Mr. Johnson asked if the townhomes are planned to be rented. Mr. Burdick said yes
at this point. It could be reviewed in 5-10 years.
Ms. Hinz asked if hesitation to making the townhomes property owner occupied is
due to the infancy of developing downtown. Mr. Burdick addressed with the price
point would be too high because of the existing housing and amenities.
Mr. Johnson asked for a timeline. Mr. Burdick addressed in 2025 will be planning
and design, starting construction in 2026 and completion in 2027.
Ms. Kopchek-White asked for clarification of where the other well is. Mr. Burdick
showed it in the drawing.
Mr. Barger inquired if the existing apartment building owner would sell the
property, how would it change their plans. Mr. Burdick said it would open up
opportunities.
Ms. Hinz shared her concern that if seems we have saturated housing within the City
and was surprised by their proposal. The market research they have they feel there
is a demand.
Mr. Morphew asked does the housing draw retail and commercial or the retain and
commercial draw housing? Mr. Burdick feels it could be a correlation. If the area is
populated the location is more desirable.
Ms. Sittig like the proposal.
Mr. Johnson asked Ms. Schumann if Monticello is still in need of affordable housing.
Ms. Schumann referred to the housing study which said there is a need for
additional affordable housing. The high demand threshold has been met.
Ms. Sittig feels that adding housing on that corner and retail on the other misses the
mark for the property given how busy the streets are. She likes the plan but for a
different block.
Mr. Barger agreed that he also liked the plan but for a different block.
Mr. Johnson feels that there is retail on the other side of Broadway and Block 34
may be a good place to have residential.
Mr. Hilgart does support the concept. He doesn't feel like the public would like it. If
there is housing it needs to be above commercial. He likes the two levels, office on
second floor.
Mr. Thares introduced Jake Olinger, Christianson Insurance, who has an interest in a
potential Block 34 site. Mr. Olinger explained what his needs were. He feels
Broadway is difficult to cross and feels the Block 34 side would be more
advantageous. Mr. Olinger stated he would like to own a building for his business.
Mr. Hilgart reiterated Mr. Olinger would like to own the building they occupy.
Mr. Johnson inquired if Mr. Olinger would be interested in owning the first floor of
offices. Mr. Olinger explained it would depend on the size and the visibility. He
would not like to be apart if there is residential above the office.
Mr. Hilgart feels that a business like this would bring in additional retail.
Mr. Michno said it would like to know more about Christianson Insurance needs and
could make changes to the concept if needed.
Ms. Schumann interjected, and Mr. Thares confirmed there were 35 developers who
received the packet. These are the 2 developers who submitted responses. There
were other developers who contacted the City, however, their interest in the entire
Block concept faded near the response deadline.
Ms. Sittig likes both proposals. She can see the Streetfront's proposal on another
site. She appreciated the work both developers put into these presentations.
The entire group thanked all guests for presenting.
6. Block 34 Redevelopment Next Steps Discussion
Mr. Thares explained this part of the agenda is intended to be a wrap up.
Ms. Sittig thought Mr. Olinger's presentation was valuable in expressing what his
needs are.
Ms. Sittig stated she feels the Streetfront's proposal misses the mark.
Mr. Barger agreed, and stated the EDA has this opportunity to create a space for
downtown businesses and to develop residential buildings around Block 34 rather
than in it.
Ms. Hinz feels residential at MN-TH 25 would not be desirable and would limit the
spaces for businesses in the downtown are.
Mr. Johnson agreed, and the EDA needs to decide what they choose to invest in.
Ms. Sittig felt the Krause -Anderson concept provides an opportunity for people to
move around and attract people downtown.
Ms. Sittig repeated that Monticello is growing and pointed out the opening of new
places like Chipotle and Starbucks; citizens would like the opportunity to visit and
shop and smaller more intimate retail places. She feels the Kraus -Anderson proposal
would bridge the gap between residential and small businesses.
Mr. Johnson asked if the Christianson group wanted to own an office, would it be
batter to move that to another area downtown.
Ms. Sittig feels if they would like to be at the corner of 3rd and Pine then that would
be advantageous to the vision she sees for Block 34 and would bring in more foot
traffic.
Mr. Barger asked if the staff knows how many employees they have. Ms. Schumann
stated they did provide us with this information however, she didn't recall it at the
time. Mr. Johnson said they asked for 40 parking spaces.
Mr. Barger did not want to give up this prime office space to a small group of 4-5
people and the amount of parking required satisfies his vision. Ms. Sittig agreed.
Ms. Schumann said that when the Christianson Group first approached the city their
initial need was smaller, and they would look at leasing the additional space and
eventually expand into this space.
Mr. Johnson did not disagree with Ms. Sittig and the concept of a one-story building
on that corner. He did state that it might depend on when they want to build. It
would create revenue right away as opposed to finding a tenant however, they may
not be sufficient to support other retail.
Ms. Schumann interjected Staff would like to hear from other Commissioners and
asked them if they would want to hear form other potential developers, before
continuing these 2 proposals. The consensus was that the staff should work with
these two developers.
Mr. Johnson pointed out that the other developers might be interested in only the
office space and the rest will fill in.
Ms. Sittig stated she felt this is a good opportunity to weed out those that listen and
verses that don't. The put out an RFP stating this is our need and what the EDA is
looking to do and these were the developers responded.
Mr. Hilgart feels the EDA concern is whether it is willing to allow a 10,000 square
foot office building on the SW Corner of Block 34. Mr. Hilgart feels that with this
building in that location there is still enough space for either of the developer's
concept and how does this fit with EDA's desired vision. At this point we don't know
if the owner of the apartment building is interested in selling.
Mr. Barger wanted clarification on Mr. Hilgart's point. Is he saying that if they build
the office space and the apartment building doesn't sell is the remaining block still
developable.
The developers said they could work around the possibility if the remaining
properties in the Block could not be acquired.
Mr. Hilgart suggested that this may be a discussion as to whether the EDA would
want development without all the property.
Ms. Hinz asked If anyone had spoken to the owner. Ms. Schumann said yes. There
was a time the Hammer's approached us and asked if we are interested in
purchasing the property. At that time the EDA was not.
Ms. Schumann stated is was a large challenge when then were talking about building
the Water Treatment Plant. With the Plant is become feasible but expensive. Staff
don't recall the timeline of the Water Treatment Plant. The soil samples have to be
done and then a decision can be made. Mr. Thares said they are exploring other
sites; some of them are EDA owned parcels.
Ms. Schumann asked if the EDA is interested in engaging Streetfront on the Cedar
Street parcel? Ms. Kopeck -White, Mr. Barger, and Ms. Hinz agreed.
Mr. Hilgart felt we should have a conversation with the flower shop. Ms. Schumann
stated staff has and the flower shop and presented a concept that would provide an
expansion and move the parking lot closer to Broadway and they were deciding on
whether the city would like that to happen. Staff have kept them informed on Block
34 and will continue that conversation.
Ms. Sittig felt that building a relationship with Krause -Anderson would be beneficial
for the EDA in the long term.
Mr. Barger stated that phase one would get rid of the DMV. Mr. Hilgart interjected
that he felt they don't have to get rid of the DMV. Mr. Barger asked what the backup
is for keeping the DMV and relocating the current tenant.
Mr. Hilgart reiterated he feels the DMV does not need to go.
Ms. Schumann referred to Mr. John's comment of what concept you see today is not
what will be built.
Mr. Morphew wasn't expecting a housing proposal. He doesn't know if that is that
right use for that spot. Mr. Johnson feels that the business and retail would be the
best use.
Staff felt this was good feedback. Ms. Hinz asked staff if they have all the action
items written down for staff needs for Krause -Anderson and Streetfront. Ms.
Schumann asked for clarity; staff is to talk with Kraus -Anderson to refigure their
concept to include the wells, existing building and DMV with Phase 1 focusing on
getting the office building completed in 2025.
Mr. Hilgart stated K-A does not need to be the contractor for the Christenson office
building. Ms. Schumann said she believes they are interested in that role though.
Schumann stated that another conversation is asking the business owner. The EDA
owns and controls the property. Whether they want Krause -Anderson to build the
building on Block 34 is also part of the discussion. She also asked if staff should ask
Krause Anderson to incorporate the various suggestions into a new concept for
additional discussion.
Ms. Schumann said that the EDA indicated that they want Christiansen Group to be
on the block. Mr. Barger said he preferred to keep him on the block. Mr. Johnson
has not made his decision.
Mr. Hilgart stated he believes the developers understand costs and realistic pricing.
Ms. Schumann stated she had heard that one commissioner wanted to develop
block by block and the rest of the members want it built as one whole development
reflecting the market today.
Mr. Hilgart felt it is fine to build block by block if they hit the price point.
Ms. Schumann stated the developers may come back and tell the EDA how they plan
to build this project and in what timeline and phases.
Mr. Johnson said that staff should go to the developer with the questions the EDA
has and have them back to see if they say what the EDA wants to hear.
Ms. Sittig stated the developers know what learned and heard in the discussion and
that Mr. Olinger would have the option to get an additional bid. Mr. Thares said
there is something called Open Book.
Mr. Johnson feels that Mr. Olinger knows what he can afford.
Ms. Schumann stated that staff can go back to Kraus -Anderson with those cost
questions and points, though the EDA needs to think if they want this built in
quarter sections or in one package.
7. Adjournment
TRACY HINZ MOTIONED TO ADJOURN, SECONDED BY HALT SITTIG, CARRIED
UNAMIOUSLY AT 5:39 P.M.
Recorder: Vicki Leerhoff __Atb,
Approved: January 22, 2025
Attest:
Jam6slThares, Economic Development Manager