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2023/11/27 - ADMIN - Agenda Packets - City Council - Study Session
AGENDA NOVEMBER 27, 2023 6:30 p.m. City council study session – council chambers Discussion items 1. 60 min. 2024 Revised budget and levies 2. 60 min. 2024 Draft legislative positions and priorities Written reports 3. Housing + neighborhood oriented development system wrap-up 4. Via Sol update - Ward 2 Members of the public can attend St. Louis Park Economic Development Authority, city council meetings and study sessions in person or watch live by webstream at bit.ly/watchslpcouncil or at www.parktv.org, or on local cable (Comcast SD channel 14/HD channel 859). Recordings of the meetings are available to watch on the city's YouTube channel at www.youtube.com/@slpcable, usually within 24 hours of the end of the council meeting or study session. The council chambers is equipped with Hearing Loop equipment and headsets are available to borrow. If you need special accommodations or have questions about the meeting, please call 952.924.2505. Meeting: Study session Meeting date: November 27, 2023 Discussion item: 1 Executive summary Title: 2024 Revised budget and levies Recommended action: No action requested. This report is for discussion purposes only. Policy consideration: Does council support the proposed 2024 budget as revised? The balanced budget consists of an "all‐inclusive” preliminary levy increase of 7.3% (down from 7.7%) and includes the following components: 1. General levies (general fund (GF), park improvement, capital replacement and employee benefits) increase of $2.1 million 2. Housing Redevelopment Authority (HRA) levy increase of $161,437 3. Economic Development Authority (EDA) levy increase of $377,000 4. Use of excess unobligated GF dollars for transfers of $485,000 in 2023 and $360,000 in 2024 Summary: Recommendations in the revised 2024 recommended budget are based on maintaining high‐quality services and advancing city priorities while also making best use of public dollars. Council approved a preliminary levy of 7.7% on Sept. 18. After thoroughly vetting all the numbers, staff was able to lower the levy to 7.3%. The 2024 budget provides a strategic opportunity to make decisions that impact the city’s long range financial plan, prepare for known and unknown fiscal issues in the medium‐term and ensure long‐term compliance with city financial policies. Revisions from the Aug. 28, 2023 proposed budget include: A $185,000 reduction to the proposed levy Additional one‐time and ongoing investments in natural resource protection A balanced, multiyear plan for city utility funds Financial or budget considerations: 2024 proposed budget and Capital Improvement Plan Strategic priority consideration: All strategic priorities. Supporting documents: 5‐year Capital Improvement Plan Prepared by: Amelia Cruver, finance director Reviewed by: Cindy Walsh, deputy city manager Cheyenne Brodeen, administrative services director Approved by: Kim Keller, city manager Study session meeting of November 27, 2023 (Item No. 1) Page 2 Title: 2024 Revised budget and levies Discussion Background: 2024 Budget development timeline August 7 General fund budget and American Rescue Plan Act (ARPA): projections at current service level, staff priorities for general fund changes, update on potential one-time capital grant program August 28 Proposed 2024 budget: revised general fund, long range financial plan, capital improvement plan, EDA and HRA levies September 18 Maximum levy adoption October 2 Fee adoption and hearing October 23 Tax Increment Financing management report November 13 Utility rate analysis and discussion November 20 Utility rate hearing November 27 Review final budget and levies prior to Truth in Taxation hearing December 4 Truth in Taxation hearing December 18 2024 budget adoption On Aug. 7 and 28, 2023 staff met with the city council to discuss recommended spending and associated revenue levels to support the Capital Improvement Plan (CIP), long-range financial plan and new budget proposals. Adjustments to baseline spending and new budget proposals included in the general fund are detailed in the Aug. 7, 2023 staff report. Highlights from 2024 projects in the recommended CIP as well as other special revenue funds like the Affordable Housing Trust Fund are detailed in the Aug. 28, 2023 staff report. Overall, the proposed 2024 budget included new investments in public safety, environmental stewardship and people and places that build social capital. Discussion of the preliminary levy surfaced a few key points of feedback on the proposed budget: • What is the city doing to maintain or enhance the city’s tree canopy? • How might emerging needs impact the long-term conditions of the city’s infrastructure? • Are there opportunities to lower the property tax levy while maintaining high quality services and working towards the city’s priorities? On Oct. 23, 2023, staff and representatives from Ehlers met with the city council to discuss tax increment financing (TIF) outcomes and decision points for 2023 and 2024. Council supported Study session meeting of November 27, 2023 (Item No. 1) Page 3 Title: 2024 Revised budget and levies continuing to pool tax increment for affordable housing purposes and deposit those funds into the city’s affordable housing trust fund through Dec. 31, 2026 when the city’s special legislation is scheduled to sunset. That report can be found here. On Nov. 13, 2023 staff met with city council to discuss utility rate increases for 2024 and that report can be found here. Each year, St. Louis Park updates rates charged for water, sewer, storm water and solid waste services. Solid waste rates will need to be meaningfully increased to cover the cost of the new five-year contracts approved in summer 2023. Staff explored several options for rate increases that would: • Cover the cost of budgeted expenses over the next 5 years. • Ensure all funds meet target fund balances at the end of the 5-year period. • Minimize costs to rate payers without preferencing one pool of ratepayers over another. Council reviewed the new contracts for solid waste this summer and indicated support for a scenario that includes a 15.5%/$55 increase in quarterly bills for the median user in 2024, and a 5%/$20 increase in quarterly bills for 2025 through 2028. Present considerations: The approved preliminary budget included a 7.7% “all-in” levy increase in 2024 and an outlook that averages 5.46% increases each year in our five-year financial management plan (assuming no unplanned spending and stable revenues). The five-year plan includes revenues and expenses that support current programs and staffing levels at the city, expected inflation in expenses and personnel costs and the attached CIP, along with forecasts for non-tax revenues. Refining spending direction: Since the preliminary levy was adopted in September 2023, several adjustments have been made to the proposed budget; these revisions are detailed in this report. Adjustments fall into two categories: 1) council actions that have been incorporated into the proposed budget and 2) city manager recommended updates. Council actions since August proposed 2024 budget: Since the proposed 2024 budget was presented to council in August, three significant council actions have been taken which will have budget impacts, either in 2024 or in the 5-year financial direction. All of these actions have been incorporated into the updated recommended 2024 budget. • In September, the city was awarded and council accepted a three-year SAFR grant from the Federal Emergency Management Agency in the amount of $1,076,290. This grant will fund three new firefighters for three years, beginning Nov. 2023. Fire has already hired and sworn in the new employees and, with the additional staff, Fire is able to meet a higher standard of performance as set by the National Fire Protection Association. The levy forecast in 2028 has been increased to account for maintaining the new FTEs on city revenue sources when the grant ends. • In October 2023, staff reported to council on the close out of the May 21 and June 3, 2023 water main break recovery program. Total spending for that program was well under budget, freeing up $1.9 million dollars for other city priorities. Study session meeting of November 27, 2023 (Item No. 1) Page 4 Title: 2024 Revised budget and levies • In October 2023, council supported continuing to pool tax increment for affordable housing purposes, confirming the one-time revenue of approximately $1.954 million budgeted for 2024 into the city’s Affordable Housing Trust Fund. These revenues will be spent in accordance with the Affordable Housing Trust Fund guidelines to create and preserve affordable housing opportunities in the city. City manager updated recommended 2024 budget: All budget proposals are analyzed for their alignment with city priorities, evidence, leverage of other funds and impact to racial equity. Further, the proposed 2024 budget leverages other resources whenever possible in order to limit the impact to taxpayers. As you can see in the table below, staff has worked to limit the impact of new general fund spending for taxpayers by leveraging other savings and grants. All tables in this section of the report are inclusive of proposals presented to council throughout the 2024 budget process. Recommended new spending by strategic priority, all non-CIP funds Aligned to Strategic Priority Summary of recommended new spending Summary of spending net reductions and new revenue Racial equity $30,000 $30,000 Environmental stewardship $270,000 $170,000 Housing and neighborhoods $500,000 $0 Social capital $65,500 $65,500 Meets many/all priorities $1,389,000 $771,000 Total $2,254,500 $1,036,500 The city manager has three overarching changes to the recommended budget, which are all detailed below. 1. Updated ongoing expenditures 2. Updated one-time expenditures 3. Updated 2024 general levy relief Recommended ongoing expenditures: The city manager recommends including the following ongoing expenditures in the 2024 budget. Updates from the proposed budget presented in August 2023 have been starred in the table below. Additions include additional funding for cybersecurity, preserving tree health and internal financial systems. Study session meeting of November 27, 2023 (Item No. 1) Page 5 Title: 2024 Revised budget and levies Recommended additional General Fund expenses by strategic priority, summary Primary Strategic Priority Proposal 2024 New spending needs Offsetting reductions or revenue 2024 Final New Spending New FTEs Notes 1 Many/all Firefighter staffing $ 368,000 $ (368,000) 3 5-year forecast with funding new FTEs in 2027 2 Many/all Office assistant $ 90,000 $ (90,000) 1 Offset with reductions in non-personnel spending 3 Many/all Police sergeants $ 60,000 $ 60,000 2 Full $360,000 expense to be realized in 2025 4 Social Capital Facilities public service worker $ 22,500 $ 22,500 1 Full $100,000 expense to be realized in 2025 5 Environmental stewardship Permit technician $ 100,000 $ (100,000) 1 Offset with permit fees from the Fats, Oils and Greases program 6 Many/all Community engagement coordinator $ 110,000 $ (60,000) $ 50,000 0 Utilizes a portion of an existing vacant FTE 7 Many/all Educational and lobbying efforts current practice $ 85,000 $ 85,000 0 Brings budget and expenses into alignment 8* Many/all Network security management, detection, and response $ 50,000 $ 50,000 Strengthens cyber-security for city data and networks 9* Many/all Budget and Learning Management Systems $ 90,000 $ 90,000 Better analysis and communication of city finances and development of city staff 10 Environmental stewardship Boulevard tree pruning $ 25,000 $ 25,000 0 Needed to maintain current service level 11* Environmental stewardship Additional seasonal staff and contractual services dollars for tree preservation $ 75,000 $ 75,000 Expand work to preserve trees and natural resources 12 Racial equity Recruitment and Jobs in the Park $ 30,000 $ 30,000 0 13 Social capital Inflationary increases to Parks and Recreation $ 43,000 $ 43,000 0 Brings budget and expenses into alignment 14 Many/all Unbudgeted adjustments $ 49,000 $ 49,000 0 2024 Staff-related new spending $ 750,500 $ (618,000) $ 132,500 8 2024 Non-staff new spending $ 447,000 $ 447,000 Total 2024 new General Fund spending $ 1,197,500 $ (618,000) $ 579,500 Study session meeting of November 27, 2023 (Item No. 1) Page 6 Title: 2024 Revised budget and levies Recommended one-time expenditures: The city manager also has updated recommendations on one-time spending in the 2024 budget based on the health of the general fund and city’s financial policies. The city’s financial policies require an unobligated fund balance between 40 and 50% of the subsequent year’s budgeted expenditures. Past practice has been to target an unobligated fund balance of at least 45% of the next year’s budget. In 2024, staff recommends retaining a fund balance at 48% of estimated spending, as a fund balance closer to 50% is an important factor in St. Louis Park’s positive bond ratings. In addition, the underspending in the May 21/June 3 water main break recovery project added $1.2 million back to the unobligated general fund balance and $700,000 back to available ARPA funds. Altogether, the city has projected $7.9 million to allocate for one-time expenses in the coming four to five years. In 2024, the city will receive the results of the infrastructure vulnerability study as well as continue collecting data on additional unprogrammed infrastructure needs. In addition, partnering agencies have brought to staff’s attention multiple infrastructure improvement projects for which a local match is required. Potential projects that staff recommend discussion on in 2024 include but are not limited to: Special Service District infrastructure, aging streetlights, watermain replacement in conjunction with state road projects, other unprogrammed capital needs and emerging maintenance issues. Given these developing conversations and pending decisions by council on updated infrastructure priorities, the city manager recommends reserving $4 million for future allocation in capital planning. By holding these funds, we can make a multi-year plan that avoids steep increases in property taxes. Altogether, this allows for council to redirect $3.9 million in one-time fund balance in 2023 and 2024. The city manager’s updated recommendation includes the following one-time expenditures. Updates from the proposed budget presented in August 2023 have been starred. Study session meeting of November 27, 2023 (Item No. 1) Page 7 Title: 2024 Revised budget and levies City manager recommended one-time expenditures in 2024 budget In addition to the above table of operating activities, the CIP includes several projects that are partially funded by grants from the state and federal government. In 2024, over $9 million in government grants have been secured to fund important infrastructure projects. Recommended lower general levy increase: Finally, the city manager’s updated recommended 2024 budget includes lowering the general levy increase. After finalizing expenditure numbers and factoring in new recommended spending above there is room to lower the general levy and still achieve a balanced budget in 2024 and a sound long-term financial plan. The city manager recommends: •Lowering the final general levy by $184,000 in 2024 for an all-inclusive levy increase of 7.3%. For context, the average preliminary levy increase for all cities in MN in 2024 was 8.3% and St. Louis Park’s approved preliminary levy increase was 7.7%. Revised levy outlook: Updated long-range financial plan: Staff has updated the five-year forecast to include the updated recommended 2024 budget. The following assumptions are built into the forecast: •Steady inflationary growth in general fund to maintain current service levels. •Additional levy in 2025 to cover the full annual cost of personnel additions in the recommended 2024 budget of two police sergeants and one public service worker. •Additional levy in 2027 to cover the cost of three new firefighters once the federal SAFR grant concludes. •Levy increases of $200,000 each year in 2024, 2025 and 2026 to “step down” after using one-time sources, rather than a one-year jump in levy revenue. Uses 2023 Proposed 2024 Proposed 2025 Projected 2026 Projected 2027 Projected General Levy relief $ 500,000 $ 300,000 $ 100,000 Living Streets projects (Debt levy relief) $ 485,000 Deferred maintenance and capital projects $ 360,000 $ 872,963 $ 203,933 Capital Replacement Additions* $ 387,000 One-time General Fund (outreach for SLP 4.0, Elections one-time costs, Capital Grant, data consultant)* $ 575,000 Natural Resource protection* $ 70,000 Emerging Capital Needs* $ 1,500,000 $ 1,500,000 $ 1,000,000 Use of one-time funds by year $ 485,000 $ 1,892,000 $ 2,672,963 $ 1,803,933 $ 1,000,000 Study session meeting of November 27, 2023 (Item No. 1) Page 8 Title: 2024 Revised budget and levies •Capital replacement levy to meet currently identified CIP needs, after using Public Safety Aid and some one-time general fund transfers. •Debt service to fund major street infrastructure projects currently laid out in the CIP. •Steady inflationary growth in the HRA and EDA levy to keep up with salary costs. 5-year financial direction (includes above assumptions) Fund 2023 Adopted 2024 Proposed 2025 Projected 2026 Projected 2027 Projected 2028 Projected General Fund $ 32,041,296 $ 34,147,654 $ 36,264,298 $ 38,096,192 $ 40,200,520 $ 42,009,544 Capital Replacement Fund $ 1,646,142 $ 2,177,793 $ 2,420,496 $ 2,664,930 $ 2,814,930 $ 2,964,930 Park Improvement Fund $ 860,000 $ 860,000 $ 860,000 $ 860,000 $ 860,000 $ 860,000 Employee Benefits Fund $ 150,000 $ 200,000 $ 150,000 $ 150,000 $ 150,000 $ 150,000 Subtotal General Levies $ 34,697,438 $ 37,385,447 $ 39,694,795 $ 41,771,122 $ 44,025,451 $ 45,984,474 Debt Service Levy $ 6,362,813 $ 6,292,503 $ 6,611,475 $ 7,057,023 $ 7,057,023 $ 7,057,023 General and Debt Service Levies $ 41,060,251 $ 43,677,949 $ 46,306,269 $ 48,828,145 $ 51,082,473 $ 53,041,497 HRA Levy $ 1,582,696 $ 1,744,133 $ 1,796,457 $ 1,850,351 $ 1,905,861 $ 1,963,037 EDA Levy $ 500,000 $ 877,000 $ 916,465 $ 957,706 $ 1,000,803 $ 1,045,839 Total Property Tax Levy $ 43,142,947 $ 46,299,082 $ 49,019,191 $ 51,636,201 $ 53,989,137 $ 56,050,373 Levy Growth 7.32% 5.88% 5.34% 4.56% 3.82% Property Tax Increase Impact by property type: The city’s portion of property tax paid by individual property owners is determined by the levy as approved by council and the market value of all properties within the city. Looking ahead to taxes payable in 2024, the market values of industrial and commercial properties are growing faster than residential. This will result in an increase in property tax bills for residential properties that is less than the overall property tax increase. In addition, the city’s recent decertification of TIF districts will increase the overall tax capacity and lower the impact to individual property owners. In 2024 the median home value is $373,300, a 0.4% increase from the previous year. Prior to the lower levy and decertification of new TIF districts, the impact to the median value homeowner was estimated to be around a 4 percent increase. The final increase will be lower than that and is being calculated in the coming weeks as levy decisions are made and final tax capacity numbers are calculated. Study session meeting of November 27, 2023 (Item No. 1) Page 9 Title: 2024 Revised budget and levies Estimated percent changes in annual property tax under a 7.3 % levy for different types of properties will be finalized and presented at budget adoption. Next steps: •Truth in taxation public hearing on Dec. 4, 2023 •Final 2024 budget adoption on Dec. 18, 2023 Capital Improvement Program City of St. Louis Park, MN PROJECTS BY DEPARTMENT 2024 2028thru Total2024 2025 2026 2027 2028DepartmentProject # Priority Buildings 31240004 85,00085,000City Hall Bridge 3 31240005 10,00010,000City Hall/Police Campus Landscaping 1 31240006 35,00035,000City Hall 2nd Floor Celing Tile Replacement 5 31240008 80,00080,000City Hall IT Office Reconfigure 5 31250002 210,000210,000City Hall 2nd Floor Windows and Blinds 5 31250004 15,00015,000CH Update HVAC Controls 3 31260001 35,00035,000City Hall First Floor Carpet Replacement 3 31260002 100,000100,000CH Access Control System Replacement, City Wide 3 31260003 8,0008,000City Hall Stair Carpet Replacement 5 31260004 35,00035,000City Hall Generator Head Gasket 1 31260005 210,000210,000City Hall 1st &3rd Floor Window and Blind Replace 3 31270001 80,00080,000City Hall EV Chargers for Fleet 3 31280001 150,000150,000City Hall Timber Retaining Walls 3 32240001 100,000100,000Police Station Locker Room Restroom Remodel 3 32240002 35,00035,000Police Station Blind Replacement 3 32240003 67,00067,000Police Property Room Remodel 3 32240004 105,000105,000PD Individual Office 3 32240005 38,00038,000Police Station VAV Replacement 1 32240006 50,00050,000Police Facility, Parking and Training Study 3 32250002 20,00020,000Police Station Replace Ceiling Tile 3 32260001 250,000250,000Police Station Exterior Bullet Resistant Glass 3 32260002 15,00015,000Police Station Exercise Equipment Replacement 5 32260003 160,000160,000Police Station Range Targeting System 5 32260004 50,00050,000Police Parking Gate 5 32270001 65,00065,000Police Station Exterior Masonry Maintenance 3 32270002 100,000100,000Police AC Replacement 3 32270003 12,00012,000PD Replace HVAC Controls 3 32280001 110,000110,000Police Locker Replacement 3 32280002 90,00090,000Police Station New Carpet 3 33140002 45,00015,000 15,000 15,000MSC & Fire Stations CO Nox Sensor Replacement 1 33220002 20,00020,000MSC Campus Landscaping 3 33240001 15,00015,000MSC New Bays LED Upgrade 3 33240003 80,00080,000MSC Small Storage Garage 5 33240004 25,00025,000MSC AV Upgrades 3 33250001 25,00025,000MSC Paint Booth Maintenance 3 33250002 250,000250,000MSC Heat Exchanger Ventilation 3 33250003 12,00012,000MSC Replace HVAC Controls 3 33250004 250,000250,000MSC Hoist Replacement 1 33250005 12,00012,000MSC Public EV Chargers 5 33270001 750,000750,000MSC Bays 1, 2 & 3 Roofing 3 33280001 250,000250,000MSC Office Remodel 3 33280002 18,00018,000MSC Carpet Replacement 3 33280003 50,00050,000MSC Security Fence 3 33280004 300,000300,000MSC Rooftop Solar 3 34240001 10,00010,000Fire Station #1 and #2 Landscaping 1 34240003 160,000160,000Fire Stations 1 & 2 Apparatus bay floor coating 1 Wednesday, November 22, 2023Page 12023-2032 Capital Improvement Plan Study session meeting of November 27, 2023 (Item No. 1) Title: 2024 Revised budget and levies Page 10 Total2024 2025 2026 2027 2028DepartmentProject # Priority 34240005 17,00017,000Fire Stations Replace HVAC Controls 1 34240006 50,00050,000Fire Station # 1 Entry Canopy 3 34250003 350,000350,000Fire Station 1 Decontamination Laundry 3 34260001 60,00060,000Fire Station #1 light fixture replacements 1 34260002 50,00050,000Fire Station #1 Training Tower modifications 5 34260004 70,00070,000FS #1 and #2 Carpet Replacement 1 34270002 35,00035,000Fire Stations Replace Excersise Equipment 5 34280001 80,00080,000Fire 1&2 Boilers 3 34280002 10,00010,000Fire Station 1 & 2 audio/visual replacements 3 35250001 45,00045,000Fire Station #2 Replace light fixtures 1 36240001 75,00075,000Westwood Multipurpose Room Flooring Replacement 3 36240002 100,000100,000Westwood Solar Panels 3 36250001 50,00050,000Westwood Parking Lot Entry Gate Replacement 3 36260001 30,00030,000Westwood Security Cameras 3 36260002 25,00025,000Westwood Replace Projectors 3 36260003 15,00015,000Westwood Replacement Rental Tables, Long 3 36270001 15,00015,000Westwood Replacement Rental Tables, Round 3 36280001 75,00075,000Westwwod Security Camera Replacement Half 3 37270001 140,000140,000Rec Center Remodel Offices 1 5,884,0001,272,000 1,977,000 1,120,000 367,000 1,148,000Buildings Total Cable TV 11151007 10,00010,000Tripods for On Location 3 11172007 40,00040,000Council Chambers HD pan/tilt cameras 1 11181005 20,00020,000Camcorders1 11191009 35,00035,000Replacement edit systems 1 11201001 160,000160,000Van Cameras 3 11201014 100,000100,000Playback systems 1 11201015 45,00045,000Production switcher 1 11251001 25,00025,000ParkTV live truck character generator (CG)3 435,00095,000 185,000 10,000 145,000Cable TV Total Engineering 40224001 190,800190,800Storm water- Lamplighter Pond rehab 1 40231100 11,042,06811,042,068Street - MSA rehab (Cedar Lake Rd TH169 to Nevada)1 40237000 8,504,9154,252,457 4,252,458County - Mtka Blvd (Hwy 100 to France)1 40240003 386,900386,900Concrete replacement- SW-C&G-CB 1 40241000 8,271,0008,271,000Street - Local street rehab (Area 2)1 40241100 17,210,90211,082,993 6,127,909Street - MSA rehab (Louisiana & Cedar Lake Rd)1 40241500 452,000452,000Alley construction 3 40241600 424,740424,740Parking lot - Maintenacne MSC 3 40243000 580,000580,000Sanitary Sewer- Lining 1 40244000 438,725438,725Storm water- South Oak rond rehab 1 40244200 25,07025,070Storm water - Carpenter Park maintenance 1 40244300 59,50059,500Storm water- BMP maintenance 1 40244500 53,60053,600Storm water- Rainwater rewards 3 40250003 397,500397,500Concrete replacement- SW-C&G-CB 1 40251000 5,562,0005,562,000Street - Local street rehab (Area 3)1 40251050 2,592,0002,592,000Street - Commercial street rehab 1 40251200 463,840463,840Street - Maintenance project (Area 1)1 40251500 595,000595,000Alley construction 3 40251601 62,63062,630Parking lot - Maintenance Fire Stn #1 3 40251602 45,37045,370Parking lot - Maintenance Fire Stn #2 3 40253000 600,000600,000Sanitary sewer- Lining 1 40253100 773,500773,500Sanitary sewer - Webster LS #10 1 Wednesday, November 22, 2023Page 22023-2032 Capital Improvement Plan Study session meeting of November 27, 2023 (Item No. 1) Title: 2024 Revised budget and levies Page 11 Total2024 2025 2026 2027 2028DepartmentProject # Priority 40254000 225,400225,400Storm water- Twin Lake outfall replacement 1 40254300 61,00061,000Storm water- BMP maintenance 1 40254500 54,80054,800Storm water- Rainwater rewards 3 40260003 408,100408,100Concrete replacement- SW-C&G-CB 1 40261000 4,727,0004,727,000Street - Local street rehab (Area 4)1 40261050 2,757,0002,757,000Street - Commercial street rehab 1 40261200 316,150316,150Street - Maintenance project (Area 2)1 40261500 611,000611,000Alley construction 3 40262000 1,561,5301,561,530CTP Bikeway - Sidewalk - Trail 5 40263000 605,000605,000Sanitary sewer- Lining 1 40264000 1,983,7501,983,750Storm water- Ainsworth Park improvements 3 40264300 62,50062,500Storm water- BMP maintenance 1 40264500 56,00056,000Storm water- Rainwater rewards 3 40270003 418,700418,700Concrete replacement- SW-C&G-CB 1 40271000 5,910,0005,910,000Street - Local street rehab (Area 5)1 40271050 2,691,0002,691,000Street - Commercial street rehab 1 40271200 252,720252,720Street - Maintenance project (Area 3)1 40271500 496,000496,000Alley construction 3 40272000 1,687,3421,687,342CTP Bikeway - Sidewalk - Trail 5 40273000 620,000620,000Sanitary sewer- Lining 1 40273100 1,246,3751,246,375Sanitary sewer - Oregon LS #7 1 40274000 339,250339,250Storm water- Otten Pond rehab 1 40274200 27,14027,140Storm water - Carpenter Park maintenance 1 40274300 64,00064,000Storm water- BMP maintenance 1 40274500 57,20057,200Storm water- Rainwater rewards 3 40280003 429,300429,300Concrete replacement- SW-C&G-CB 1 40281000 7,581,0007,581,000Street - Local street rehab (Area 6)1 40281050 1,381,0001,381,000Street - Commercial street rehab 1 40281200 432,260432,260Street - Maintenance project (Area 4)1 40281500 535,000535,000Alley construction 3 40281700 5,374,0005,374,000Bridge - Meadowbrook @ Minnehaha Creek 1 40283000 635,000635,000Sanitary sewer- Lining 1 40284000 101,775101,775Storm water- Shelard basin rehab 1 40284001 104,362104,362Storm water- Park Glen resliancy improvements 1 40284002 104,363104,363Storm water- Minnehaha Creek equalizer pipe 5 40284300 65,50065,500Storm water- BMP maintenance 1 40284500 58,40058,400Storm water- Rainwater rewards 3 102,772,97726,176,860 26,768,491 19,215,939 13,809,727 16,801,960Engineering Total Fire 65990001 60,00060,000Thermal Imagers 1 65990002 30,00030,000Outside Warning Sirens 1 65990004 60,00060,000Hydraulic Rescue Tool 5 65990005 55,00055,000Auto-CPR Device 1 65990006 100,000100,000Turnouts1 65990009 39,00039,000AED's 1 65990010 24,00012,000 12,000Body Armor 3 65990014 10,00010,000Ice/Water Rescue Cache 3 65990016 25,00025,000Technical Rescue Cache 3 65990020 21,50021,500EMS - MED Kits 3 424,50069,000 188,500 112,000 55,000Fire Total Operations & Recreation 21176501 20,00020,00040th & France Master Plan 3 21201801 345,000345,000Dakota Park LED Baseball Field Light & Pole Rplcmt 3 Wednesday, November 22, 2023Page 32023-2032 Capital Improvement Plan Study session meeting of November 27, 2023 (Item No. 1) Title: 2024 Revised budget and levies Page 12 Total2024 2025 2026 2027 2028DepartmentProject # Priority 2121280401 14,00014,000Court Resurface - Bass Lake Tennis 3 21216101 390,000390,000Webster Park Construction 5 21240317 75,00075,000Trail Reconstruction - Aquila Park 3 21241103 20,00020,000Carpenter Park/Skippy Field Batting Cages n/a 21241118 50,00050,000Trail Reconstruction - Carpenter Park 3 21241303 20,00020,000Cedar Knoll/Carlson Field Pitching Mound n/a 21242719 30,00030,000Trail Reconstruction - Jersey Park 1 21242803 25,00025,000Jorvig Park / Depot Exterior Bldg Repair n/a 21244001 6,0006,000Court Resurface - Minikahda Vista Park Basketball 3 21246202 30,00030,000Westwood Hills NC, paver parking lot 3 21252101 5,0005,000Court Resurface - Fern Hill Park Tennis 3 21256403 100,000100,000Wolfe Park Amphitheater Pavers 3 212593202 51,50051,50040th & France Fencing & Parking Lot 3 21259903 100,000100,000Trail Reconstruction 3 21259905 150,000150,000Park Shelter Replacement - various parks 3 21259906 100,000100,000Trail Lighting 3 21260601 6,0006,000Court Resurface - Birchwood Basketball 3 21269901 100,000100,000Park Parking Lot Resurface 3 21269903 130,000130,000Trail (new), Hampshire Park to Otten Pond n/a 21270301 14,00014,000Court Resurface - Aquila Park Basketball 3 21271101 225,000225,000Carpenter Park LED Ballfield Replacement Pole/lte 3 21271105 17,50017,500Court Resurface - Carpenter Park Tennis 3 21274301 14,00014,000Court Resurface - Northside Park Tennis 3 21275801 50,00050,000Court Recon+Hoop - Twin Lakes Park Basketball 3 21276403 23,00023,000Court Resurface - Wolfe Park (Pklbll & Bsktbll)3 21279903 200,000200,000Park Building Upgrades-Electric furnaces 3 21281301 300,000300,000Cedar Knoll Park - Carlson Field LED replacement 3 21285201 4,0004,000Court Resurface - Shelard Park Basketball 3 21990101 80,00080,000Playground Eqpt Repl - Ainsworth Park + concrete 1 21990301 100,000100,000Playground Eqpt Repl - Aquila Park 1 21990902 70,00070,000Playground Eqpt Repl - Bronx Park 1 21991002 80,00080,000Playground Eqpt Repl - Browndale Park 1 21991503 70,00070,000Playground Eqpt Repl - Cedarhurst Park 1 21991712 70,00070,000Playground Eqpt Repl - Parkview Park 1 21992401 70,00070,000Playground Eqpt Repl - Hampshire Park 1 21992611 70,00070,000Playground Eqpt Repl - Jackley Park 1 21992801 70,00070,000Playground Eqpt Repl - Jorvig Park 1 21993217 70,00070,000Playground Eqpt Repl - Knollwood Green 1 21994402 70,00070,000Playground Eqpt Repl - Oak Hill Park (Tot eqpt)1 21994403 105,000105,000Playground Eqpt Repl - Oak Hill Park (Big eqpt)1 21996112 65,00065,000Playground Eqpt Repl - Webster Park 1 21996403 70,00070,000Playground Eqpt Repl - Wolfe Park (tot)1 21999901 40,00020,000 20,000Landscaping - City Entrance Signs & MSC Bldg 3 21999902 150,00030,000 30,000 30,000 30,000 30,000Playground Woodchips 1 21999907 125,000125,000Trail Restoration 3 22239901 150,00030,000 30,000 30,000 30,000 30,000Pollinator Conversion / Maintenance n/a 22999901 490,00090,000 100,000 100,000 100,000 100,000Tree Replacement (80% blvd + 20% parks)3 22999903 125,00025,000 25,000 25,000 25,000 25,000Buckthorn Management 3 23236220 25,00025,000Westwood Hills NC Boardwalk Deck Repl, Ph 3 1 23246202 20,00020,000Westwood Hills NC Staircase Railing 1 23256203 100,00030,000 30,000 40,000Westwood Hills NC Boardwalk Deck Repl, Ph 1,Wside 3 23256204 50,00050,000Westwood Hills NC Waterfall liner repair 5 23286201 10,00010,000Westwood Hills NC Exhibit Wall 5 23286203 20,00020,000Westwood Hills NC Waterfall Deck Redecking 1 24245004 500,000500,000Rec Center Generator Replacement 1 24255003 25,00025,000Rec Center Banquet Room Carpet Replacement 3 24255004 50,00050,000Rec Center East Arena Light Replacement n/a Wednesday, November 22, 2023Page 42023-2032 Capital Improvement Plan Study session meeting of November 27, 2023 (Item No. 1) Title: 2024 Revised budget and levies Page 13 Total2024 2025 2026 2027 2028DepartmentProject # Priority 24255010 800,000100,000 700,000Rec Center West Arena Roof Replacement 1 24265003 375,000375,000Rec Center West Arena Locker Room Remodel 3 24265004 1,000,0001,000,000Rec Center Boiler Replacement 1 24275001 150,000150,000Rec Center Restroom Plumbing n/a 24275003 150,000150,000Rec Center Cooling Tower Replacement 1 24275004 400,000400,000Rec Center East Arena Dehumidification 1 24995003 300,000150,000 150,000Rec Center/ROC Dasher Board Replacement 1 24995006 30,00015,000 15,000Rec Center Arena Refrigeration Maintenance 1 24995008 125,00050,000 75,000Rec Center Dasher Board Repair 3 24995017 110,00020,000 20,000 20,000 25,000 25,000Rec Center Landscaping (woodchips)3 25210203 50,00050,000Rec Center Aquatic Park Feasibility Study 3 25240202 325,000325,000Rec Center Aquatic Park Pool Heaters 1 25240203 100,000100,000Rec Center Aquatic Park Slide Recoating 1 25250201 275,000275,000Rec Center Aquatic Park Pool Gutters 1 25270204 100,000100,000Rec Center Aquatic Park Feature(s)3 25280201 75,00075,000Rec Center Aquatic Park Pump Replacement 3 25990212 30,00015,000 15,000Rec Center Aquatic Park Deck Furniture 1 25990215 20,00010,000 10,000Rec Center Aquatic Park Concession Eqpt. Rplcmt 3 27236604 95,00095,000ROC Turf Replacement 1 27246603 30,00010,000 10,000 10,000ROC Roof Assessment 1 27256601 25,00025,000ROC Stucco Repair n/a 50244101 195,000195,000Street Light Annual Replacement (2024)1 50244110 320,000320,000Street Light Replacement, SSD2a 1 50254101 200,000200,000Street Light Annual Replacement (2025)1 50254110 330,000330,000Street Light Replacement, SSD2b 1 50264101 205,000205,000Street Light Annual Replacement (2026)3 50264102 750,000750,000Replace Street Light Bases/Wiring; Shelard Park 3 50264110 340,000340,000Street Light Replacement, SSD3a 1 50274101 210,000210,000Street Light Annual Replacement (2027)3 50274110 350,000350,000Street Light Replacement, SSD3b 1 50284101 215,000215,000Street Light Annual Replacement (2028)3 50284110 360,000360,000Street Light Replacement, SSD4a 1 53245001 60,00060,000Water Well Rehab (SLP16)3 53245002 520,000520,000Water Treatment Plant Rehab, WTP16 1 53245003 60,00060,000Water Well Rehab (SLP8)3 53255001 95,00095,000Water Well Rehab (SLP12)3 53255003 95,00095,000GAC Replacement (WTP1)1 53255004 460,000460,000Water Treatment Plant Rehab, WTP6 1 53265002 65,00065,000Water Well Rehab (SLP4)3 53265003 65,00065,000Water Well Rehab (SLP15)3 53265004 400,000400,000Water Treatment Plant Rehab, WTP8 1 53275002 100,000100,000GAC Replacement (WTP1)1 53275003 500,000500,000Water Treatment Plant Rehab, WTP10 1 53285001 100,000100,000Water Well Rehab (SLP13)3 53285002 715,000715,000Water Treatment Plant Rehab, WTP1 1 E - XX01 14,261,6122,048,483 2,133,065 2,577,108 4,269,314 3,233,642Annual Equipment Replacement Program 1 31,091,6124,844,483 4,929,565 7,543,108 7,497,814 6,276,642Operations & Recreation Total Police 13995069 330,000150,000 180,000911 Server Replacement 1 20180001 12,00012,000SWAT Rifle replacement 1 20180002 24,00024,000SWAT Robot 3 20180003 10,00010,000SWAT Ballistic Shields 1 20210001 65,5006,500 59,000Dispatch Consollettes 1 20240001 18,00018,000SWAT Indoor-Drone 3 20240002 15,00015,000Message Board 3 Wednesday, November 22, 2023Page 52023-2032 Capital Improvement Plan Study session meeting of November 27, 2023 (Item No. 1) Title: 2024 Revised budget and levies Page 14 Total2024 2025 2026 2027 2028DepartmentProject # Priority 20240003 5,0005,000Mobile Camera Trailer 3 479,500215,500 74,000 190,000Police Total Technology 13125001 148,65528,000 28,840 29,705 30,596 31,514IR: PCI Re-Assessment / Training / Security 1 13135001 535,084100,786 103,809 106,923 110,131 113,435IR: Hosted / Managed Services / DR / BC 1 13135004 20,00020,000OR: AVL / GPS 3 13145010 650,000650,000Police: New CAD/RMS/Mobile Suite 3 13155006 225,29842,436 43,709 45,020 46,371 47,762Admin Serv:Laserfiche ECM System Maintenance 1 13155007 123,91423,340 24,040 24,761 25,504 26,269IR: MyStLouisPark CRM 3 13155008 225,000225,000IR: City Hall Council Chambers AV Upgrade 3 13155020 000000Police: Zuercher Crime View Dashboard 3 13165007 21,2374,000 4,120 4,244 4,371 4,502Admin Serv: HR Time Management System 3 13165009 234,20046,840 46,840 46,840 46,840 46,840B&E / Fire / CD: Project Dox 1 13175004 18,00018,000Eng: Trimble R2 GPS Receiver 1 13175006 35,00035,000IR: Wireless Controller Replacement / Expansion 1 13185002 61,95811,670 12,020 12,381 12,752 13,135Fire: Zuercher Field Ops Mobile Solution 3 13185003 25,00015,000 10,000Fire: Station Cameras / EOC in 2025 3 13195001 200,000200,000Admin Serv: Utility Billing App (with ERP)3 13195073 33,9046,386 6,578 6,775 6,978 7,187IR: Lidar (one-time) / ESRI GIS Hub 3 13215002 45,0598,487 8,742 9,004 9,274 9,552Admin Serv: NeoGov E-Documents Verification 3 13215003 12,00012,000OR: Trimble R2 GPS Receivers (2)1 13275019 50,00050,000OR: Nature Center Surveillance Cameras, Building 3 13995001 1,850,549354,792 365,136 365,790 376,764 388,067IR: On-going Software Licenses, Mtce, Development 1 13995002 704,058132,612 136,591 140,689 144,909 149,257IR: On-going Network Adds & Replacement 1 13995003 1,037,000385,000 150,000 220,000 139,000 143,000IR: On-going Hardware Adds & Replacement 1 13995004 660,000280,000 0 180,000 100,000 100,000Police: 800 MHz Mobile Police Radios 1 13995006 442,000200,000 28,000 28,000 158,000 28,000Police: Squad Computers / Printers / Cell Service 1 13995007 80,00080,000Fire / Police: Dispatch Voice Recorders 1 13995011 280,00055,000 55,000 55,000 55,000 60,000OR: Asset Mgmt Software (CarteGraph)3 13995013 16,00016,000IR: EOC Computer / Phone Equipment Replacement 3 13995016 15,00015,000B&E: City Hall Cameras 3 13995017 140,81126,522 27,318 28,138 28,982 29,851Admin Serv - Hubble Budgeting Annual Maintenance 1 13995021 54,00025,000 29,000Police: Jail Cameras (17)1 13995022 20,00020,000Police: Non-Jail Cameras 1 13995024 55,00055,000Police: Dispatch Camera Viewing Workstations 1 13995025 88,00030,000 58,000OR: Rec Center / ROC / Lot Camera Replacements 1 13995026 95,75218,035 18,576 19,134 19,708 20,299IR: Surveillance Camera and S2 Locks Maintenance 3 13995029 38,3017,214 7,431 7,653 7,883 8,120IR: Central City Hall Plotter (Lease)1 13995035 60,00060,000IR: Telephone Handset / Handless Upgrades 3 13995036 32,1056,047 6,229 6,415 6,608 6,806IR: Remote Building Large Scanner / Plotter 3 13995040 6,5006,500Police: Interview Room Cameras 1 13995041 22,00011,000 11,000IR: Wireless Hotspot Additions / Replacements 3 13995042 202,20336,594 38,423 40,344 42,362 44,480Police: Zuercher CAD Module Annual Fees 1 13995043 120,000120,000Police: Roll Call / EOC AV Equipment Replacement 3 13995050 730,000730,000Fire: 800 MHz Mobile Fire Radio Replacements 1 13995052 35,00035,000OR: Oak Hill Camera/Security/Wi-Fi Replacements 3 13995056 47,8769,018 9,288 9,567 9,854 10,149Police: Field Ops Subscription 1 13995057 41,00041,000IR: UHL Camera Servers Replacement - City Hall 1 13995058 104,72420,100 20,700 21,308 21,308 21,308IR: Adobe Software Products Licensing 1 13995060 30,00030,000OR: Birchwood Cameras / S2 Security 3 13995061 15,00015,000OR: Wolfe Park Pavilion S2 / Amphitheatre Cameras 3 13995064 65,00065,000OR: Rec Banquet Room & Gallery A/V System Replace.1 13995066 295,80057,800 58,000 59,000 60,000 61,000IR: Fiber Asset Management 1 13995067 1,225,000245,000 245,000 245,000 245,000 245,000Police: Body and Squad Dash Cameras/Video Storage 3 13995068 78,85514,853 15,298 15,757 16,230 16,717Admin Serv: Tungsten Elec Accounts Payable 3 Wednesday, November 22, 2023Page 62023-2032 Capital Improvement Plan Study session meeting of November 27, 2023 (Item No. 1) Title: 2024 Revised budget and levies Page 15 Total2024 2025 2026 2027 2028DepartmentProject # Priority 13995070 22,00022,000OR: Rec POS Stations 3 13995072 8,0008,000Police: East / North Side Camera Replacements 3 13995073 2,558,410481,888 496,345 511,235 526,572 542,370IR: LOGIS Software Applications 1 13,940,2533,778,920 2,232,033 2,994,683 2,654,997 2,279,620Technology Total GRAND TOTAL 155,027,84236,451,763 36,280,589 30,995,730 24,458,538 26,841,222 Report criteria: Active Projects All Address data All Categories All Departments All Contacts All From Street data All Priority Levels All Projects All Source Types All Street Name data Wednesday, November 22, 2023Page 72023-2032 Capital Improvement Plan Study session meeting of November 27, 2023 (Item No. 1) Title: 2024 Revised budget and levies Page 16 Meeting: Study session Meeting date: November 27, 2023 Discussion item: 2 Executive summary Title: 2024 Draft legislative positions and priorities Recommended action: None Policy considerations: • Does the council agree with the draft 2024 legislative positions and priorities? Summary: The primary purpose of the legislative positions document is to guide the government relations work of the city at a state and federal level. The document can also be used by the public to understand the positions the city will advocate for at all levels of government when provided the opportunity. For this reason, legislative positions are written to generally include the long-term positions of the city on an issue while remaining inclusive of the changing nature of specific legislation or programming that is proposed by elected officials. The positions also include specific law changes suggested by staff to better complete the work the city is required to perform. A small subset of positions is selected each year to be St. Louis Park specific legislative priorities. At the request of council and following the guidance of our contracted lobbyist, staff revised the city’s existing legislative positions document to be easier to absorb and apply in a rapidly changing political environment. The updated draft positions are attached to this report. Substantive additions or changes are highlighted, which were made in consultation with city directors. Following the study session, staff will update the document as needed, based on council discussion and direction. A study session with elected leaders will be scheduled in early 2024 to communicate city priorities to representatives. Minnesota’s 94th legislative session will convene on Monday, Feb. 12, 2024. Financial or budget considerations: Funding for lobbyists is included in the budget. Strategic priority consideration: The legislative positions directly align with all five of the strategic priorities by design. Supporting documents: 2024 Draft legislative priorities Prepared by: Annie Pottorff, sustainability specialist and temporary elections and civic engagement coordinator Reviewed by: Cheyenne Brodeen, administrative services director Approved by: Kim Keller, city manager Study session meeting of November 27, 2023 (Item No. 2) Page 2 Title: 2024 Draft legislative positions and priorities Legislative priorities: The city’s legislative positions are detailed in the full document attached to this report. Each year a few of these items are selected as priorities when they meet the criteria of being actively discussed at the state legislature, subjects that relate to committees on which our delegation serves and have a significant St. Louis Park impact that is separate from that of our peer cities and communities. As this legislative session will include a capital investment bill, staff have identified two priority capital investment projects to highlight below: 1. TH100 Service Road Loop Investments – project will feature a new trail for bicycles and pedestrians with safety and accessibility improvements. 2. Oxford / Louisiana Area infrastructure investment – planned improvements include repairs to sidewalks, water and sewer facilities, and upgrades related to traffic and pedestrian safety. New and changed positions: Each year the city council reviews the list of positions and priorities. During that review, city staff also highlights issues that affect our ability to adequately provide services to residents. This year, many positions were updated or removed in recognition of an extremely busy legislative session in 2023. New issues and those with additional significant changes are positions on: the advanced state energy code, urban forest management, property tax reductions related to land trust arrangements, cable and telecommunications infrastructure, adult use cannabis, earned sick and safe time, employer mandates, comprehensive planning, housing TIF district modifications, rental rehab loan program, prohibition on discrimination and emergency medical services. These issues are highlighted in the attached draft legislative priorities summary. Additions and modifications include: • Climate, energy and buildings: supporting improved residential energy codes and the establishment of an ongoing state grant program to fund urban forest management initiatives. • Economic development: updates reflect supporting a property tax reduction rate for commercial properties purchased under community or commercial land trust agreements to support the creation of affordable commercial spaces for businesses across the state, and updates to land management for cable and telecommunications infrastructure. • Adult-use cannabis: The 2023 legislative session legalized adult-use cannabis. Though many questions remain for the regulation and enforcement of this industry in Minnesota, the city supports a regulatory framework that maintains or expands local control and removes the fee-cap for local service. • Additional good governance positions: supporting legislative clarification for earned sick and safe time for specific city positions, opposing any employer mandates that would diminish managerial rights related to collective bargaining and supporting exempting comprehensive plans from the Minnesota Environmental Rights Act. • Emergency Medical Services: supporting an Emergency Medical Services solution that will balance the needs of residents and providers statewide. • TIF District requirements: supports various modifications to TIF District requirements, relating to the creation of affordable housing and transit-oriented developments. • Renter rights and affordable rental: supporting a statewide prohibition on discrimination against renters receiving rental assistance and supports the Study session meeting of November 27, 2023 (Item No. 2) Page 3 Title: 2024 Draft legislative positions and priorities establishment of a new statewide housing rehab loan program to preserve NOAH rental properties. Staff will continue to research additional positions and priorities as they emerge throughout the year. Additional Resources League of Minnesota Cities: Legislative policies Metro Cities: Legislative Policies City of St. Louis Park 2024 Legislative Priorities Study session meeting of November 27, 2023 (Item No. 2) Title: 2024 Draft legislative positions and priorities Page 4 Title: 2024 legislative priorities Strategic Priorities St. Louis Park is committed to: Being a leader in racial equity and inclusion in order to create a more just and inclusive community for all. Continue to lead in environmental stewardship. Providing a broad range of housing and neighborhood- oriented development. Providing a variety of options for people to make their way around the city comfortably, safely and reliably. Creating opportunities to build social capital through community engagement. Study session meeting of November 27, 2023 (Item No. 2) Title: 2024 Draft legislative positions and priorities Page 5 Title: 2024 legislative priorities Capital investment priorities 1.TH100 Service Road Loop Investments The project features a new trail for bicycles and pedestrians with ADA accommodations, new LED streetlighting, enhanced pedestrian crossings, replacement of aging pavement, and modifications to existing intersections. To create a safe bicycle and pedestrian facility, this project also includes the construction of the West End trail connection along the East TH100 service drive. 2.Oxford / Louisiana Area infrastructure investment The planned public improvements for the Oxford/Louisiana area include construction and repair of aging sidewalks; critical repairs to water, sewer, and storm sewer facilities; general improvements or upgrades related to traffic and pedestrian safety, including replacement of streetlights, striping, and signs; replacement or repair of pavement, curb, and gutter; roundabout construction; stormwater quality improvements and flood storage. Study session meeting of November 27, 2023 (Item No. 2) Title: 2024 Draft legislative positions and priorities Page 6 Title: 2024 legislative priorities Climate, Energy, and Buildings The City of St. Louis Park supports innovative strategies in the pursuit of a more sustainable climate worldwide, including the adoption of near- term emission reduction targets as described in the city’s Climate Action Plan. Advanced state energy code Legislation for an advanced commercial state energy code was passed in 2023. Support continued adoption of improved residential energy codes for efficient building standards. Environment and sustainability Support the adoption of ambitious policies and the creation of innovative programs to reach the goals of the state’s Climate Action Framework and the St. Louis Park Climate Action Plan. Construction codes Oppose legislation that would reduce the current minimum building and energy code standards or limit future adoptions of improved energy conservation standards. Fee-for-service programs Support maintaining minimum standards for building safety, longevity, and energy conservation, and allow local governments to continue with fee-for-service permitting and inspection. Residential fire sprinklers Oppose efforts that prohibit future adoption of residential fire sprinkler codes. Urban forest management Support establishing an ongoing state grant program with at least $15 million per year that is usable for urban forest management. Building and Energy Director Brian Hoffman Email: bhoffman@stlouisparkmn.gov Phone: (952) 924-2584 Study session meeting of November 27, 2023 (Item No. 2) Title: 2024 Draft legislative positions and priorities Page 7 Title: 2024 legislative priorities Economic Development The City of St. Louis Park supports a thriving local economy of small and large businesses and strives to create a place where people can live, work, and play. Affordable Commercial Center Small businesses are struggling to find affordable commercial space, which is vital to their long-term success. Affordable ownership opportunities are also key to the ability of small businesses to build assets and generational wealth. One way to effectively address these needs is to provide opportunities through a commercial land trust model. St. Louis Park has acquired a commercial building and is currently working with a commercial land trust to rehab and subdivide the building into multiple spaces that will be sold to small businesses enabling them to secure affordable space and build wealth. Taking the land costs out of the equation allows for the creation of affordable commercial space that remains affordable in perpetuity. The city is seeking $1.6 million to assist with the building’s renovation and build- out. Cable and telecommunications Oppose the preemption of local authority to manage public rights-of-way and land use for cable and telecommunications infrastructure, and the preemption of local franchise authority. DEED program funding Support the continued annual funding of DEED programs at stable, sustainable, or increased levels, as well as tools to invest in underserved areas of the state that would allow all regions to better prosper. Property tax reduction for commercial properties purchased under community/commercial land trust arrangements Support a property tax classification rate reduction for commercial properties purchased under community/commercial land trust arrangements (similar to the 4d(2) classification rate established for homesteads purchased through community land trusts) to stimulate the creation and purchase of affordable commercial properties for limited income entrepreneurs throughout the state. Community Development Director Karen Barton Email: kbarton@stlouisparkmn.gov Phone: (952) 924-2684 Study session meeting of November 27, 2023 (Item No. 2) Title: 2024 Draft legislative positions and priorities Page 8 Title: 2024 legislative priorities General Government The City of St. Louis Park supports good governance in the form of legal authority to help residents to thrive. Adult use cannabis Support a regulatory framework that maintains or expands local control and removing the fee- cap for local service. Aircraft noise Support evaluating the effects of consolidated flight tracks because of RNAV on departures. Cable franchising authority Support congress to recognize, support and maintain the exercise of local franchising authority. Earned Sick and Safe Time Support legislative clarification on the application of these rules for certain city positions. Employer Mandates Oppose any employer mandates that diminish the inherent managerial rights as they pertain to collective bargaining. Levy limits Oppose levy limits or other proposed restrictions for local government budgets. Local Control Support local control as a principle that applies to many issues. Comprehensive planning Support exempting comprehensive plans from the Minnesota Environmental Rights Act, just as they are similarly exempted from the Minnesota Environmental Policy Act. Minnesota Health Plan Support universal health care access in the form of Medicare for All. Open Meeting Law Support including virtual options for open meetings. Records retention Support inclusion of social media and text messaging and a standard 3-year retention period. Safeguard public code employees Support League of Minnesota Cities’ policy related to assaults on code compliance officials and inspectors. City Manager Kim Keller Email: kkeller@stlouisparkmn.gov Phone: (952) 924-2526 Study session meeting of November 27, 2023 (Item No. 2) Title: 2024 Draft legislative positions and priorities Page 9 Title: 2024 legislative priorities Housing The City of St. Louis Park supports housing for all residents in the city including policies that build and maintain housing and aid in associated costs. Housing TIF District Modifications Support •Modifications to the existing Housing TIF District requirements to allow for greater flexibility for the creation of more deeply affordable housing for households at or below 30% area median income. •Creation of transit-oriented TIF Districts. •Expand authority for all cities to transfer unobligated pooled increment from a housing or redevelopment TIF District to support a local housing trust fund for any eligible expenditure under Minn. Stat. 462C.16 Local housing trust fund Expand authority for all cities to transfer unobligated pooled increment from a housing or redevelopment TIF District to support a local housing trust fund for any eligible expenditure under Minn. Stat. 462C.16 Prohibition on discrimination Support a statewide prohibition on discrimination against source of income for renters receiving rental assistance. Support Voucher Acceptance Support additional funding for the housing choice voucher programs and other rental assistance programs and financial, tax, and/or other incentives for rental property owners to participate in these programs. Rental rehab loan program Support the establishment of a statewide housing rehab loan program to facilitate the preservation of NOAH multi-family residential rental properties and encourage owners to retain the affordability of their developments. TOD Housing Fund Support the creation of a transit-oriented development affordable housing fund and the creation of a transit-oriented TIF District. Community Development Director Karen Barton Email: kbarton@stlouisparkmn.gov Phone: (952) 924-2684 Study session meeting of November 27, 2023 (Item No. 2) Title: 2024 Draft legislative positions and priorities Page 10 Title: 2024 legislative priorities Public Safety The City of St. Louis Park supports public safety policies and rules that help our front-line workers and ensure equitable and safe outcomes for residents. Criminal background checks Support preventing individuals who are not legally able to purchase a gun from doing so without background checks at gun shows, online, or in private transactions. Emergency medical services Support a solution for EMS services that balances the needs of residents and providers statewide. Expansion of legal fireworks Oppose legislation that expands fireworks in Minnesota. Gun violence protective orders Support allowing law enforcement in certain cases to temporarily remove any guns in an individual's possession and to prohibit new gun purchases for the duration of the order. Health insurance coverage for disabled public safety officers Support this mandate being fully funded by the state. Mandated law enforcement training Support continuing the POST Board training reimbursement allocation to local agencies. Race Data Collected on Minnesota Driver's License and State Identification Support the Minnesota Department of Public Safety to require individuals self-identify their race when applying for a driver's license or state identification. Police Chief Bryan Kruelle Email: bkruelle@stlouisparkmn.gov Phone: (952) 924-2128 Fire Chief Steve Koering Email: skoering@stlouisparkmn.gov Phone: (952) 292-0281 Study session meeting of November 27, 2023 (Item No. 2) Title: 2024 Draft legislative positions and priorities Page 11 Title: 2024 legislative priorities Transportation and Infrastructure The City of St. Louis Park supports providing a variety of options for people to make their way around the city comfortably, safely, and reliably. Cedar Lake Road and Louisiana Avenue reconstruction This project includes the replacement of aging pavements, new sidewalks, dedicated bicycle facilities, ADA accommodations, new bus pullouts, new LED street lighting, enhanced pedestrian crossings, modifications to existing traffic signals, and water main replacement. A roundabout is proposed at the intersection of Cedar Lake Road and Louisiana Avenue. Railway safety Support accountability, safety, and funding of accident prevention, as well as new rules around railway safety. Redesign CSAH 25 Support Hennepin County’s funding of rehabilitation/reconstruction of CSAH 25. Southwest LRT Support the continued work and completion of the Southwest LRT Project to provide businesses, residents, and visitors with multiple transportation options. Texas Ave. and Minnetonka Blvd. Support Hennepin County partnering for the reconstruction of the Texas Avenue Minnetonka Blvd intersection. Transit financing Support revenue sources to fund the operating budget for all regional transit providers. Transportation funding Support sufficient statewide transportation funding, for all modes of travel, and local control to serve long-term needs. Engineering Director Deb Heiser Email: dheiser@stlouisparkmn.gov Phone: (952) 924-2551 Study session meeting of November 27, 2023 (Item No. 2) Title: 2024 Draft legislative positions and priorities Page 12 Meeting: Study session Meeting date: November 27, 2023 Written report: 3 Executive summary Title: Housing + neighborhood-oriented development system wrap-up Recommended action: None Policy consideration: The purpose of this report is to summarize the outcomes of the recent discussions within the housing and neighborhood-oriented development system study sessions. Summary: From Oct. 2 to Nov. 20, 2023, the council had a series of discussions focused on advancing the city's strategic priority related to housing and neighborhood-oriented development. The council’s discussions focused on public policy on several topics relating to providing a broad range of housing and neighborhood-oriented development. Staff also provided the council with written reports to provide information on current activities, programs and policies. This report serves as a summary of all the discussions and includes the council direction provided. Financial or budget considerations: Funds are budgeted in the 2024 community development, housing, and economic development budgets for a variety of programs related to supporting housing and neighborhood-oriented development. Should the council desire a change in work surrounding housing and neighborhood-oriented development, additional resources may be required. Strategic priority consideration: St. Louis Park is committed to providing a broad range of housing and neighborhood oriented development. Supporting documents: Discussion Prepared by: Karen Barton, community development director Approved by: Kim Keller, city manager Study session meeting of November 27, 2023 (Item No. 3) Page 2 Title: Housing + neighborhood-oriented development system wrap-up Discussion Background: This system included study sessions covering a range of topics related to housing and neighborhood-oriented development. Topics were grouped and had self-contained outcomes based on various policy and practice questions. Reports on these topics were considered and discussed by the city council and, where appropriate, direction on future expectations and outcomes was provided to staff for implementation. A summary of the topics covered in this system includes: Meeting subject: Housing and neighborhood-oriented development system introduction Date: 10/2/2023 Overview: Staff introduced the system, which included discussions and information relating to housing and neighborhood-oriented development policy, planning, construction and preservation. Staff also presented council with a community development year in review to provide background, overview and outcomes relating to current programs, development projects and policies. Outcomes: The council approved of the proposed system topics and had positive feedback for the year in review presentation. Meeting subject: 2023 Housing Study and dashboard primer Date: 10/9/2023 Overview: Approximately every five years, the city contracts to have a comprehensive housing study conducted. Matt Mullins from Maxfield Research presented the 2023 housing study during the council study session. Key takeaways from the report included: • A projected demand for 3,900 general occupancy housing units through 2030 • Market rate construction will likely meet the demand for that product type • Affordable unit demand won’t likely be met, especially deeply affordable units (30% AMI) • There is demand for 138 single-family houses and 1,013 multi-family ownership units by 2030 that likely will not be met • There is a strong demand for condominiums, but builders are on the sidelines for a variety of reasons • The current interest rate environment is impacting and will continue to impact development in the near-term • There is an anticipated slow-down in the multi-family housing market over the next two years • Seniors are staying in their single-family houses longer due to a lack of senior housing options • Over 75% of St. Louis Park households are comprised of one or two persons • About half of the market rate rental housing stock in St. Louis Park is affordable at or below 60% area median income (AMI) Study session meeting of November 27, 2023 (Item No. 3) Page 3 Title: Housing + neighborhood-oriented development system wrap-up • St. Louis Park is one of only three cities (Richfield and Bloomington) in the metro area utilizing so many programs, policies and tools to advance affordable housing Following the housing study presentation and Q&A, staff provided a brief primer of the city’s multi-family housing dashboard to refresh and introduce its use and information. Outcomes: Council had a range of comments and questions relating to the data, to which Matt responded and provided answers. The 2023 Housing Study is available on the city’s website. Staff will utilize the data in the study and council feedback to inform current and future programs and policies. Based on information in the study and council feedback, staff will increase focus on the supply of 30% AMI units and increasing ownership opportunities. Council requested that the housing study be placed on the main housing page of the city’s website, which staff completed. Meeting subject: Miscellaneous Housing Program Updates Date: 10/9/2023 Overview: Council was provided with a written report outlining updates to city housing programs and policies. These recommendations included: • Increasing the income limit to 120% AMI in the affordable housing trust fund for homeownership programs • Clarification allowing for the stacking of the city’s first-generation homeownership program, the state’s first-generation homeownership program, the city’s down-payment assistance program, and other downpayment assistance programs; and • Eliminating the credit requirement for the first-generation homeownership program and instead using the first mortgage criteria to qualify. Outcomes: Council was supportive of the recommended program and policy updates. Staff have begun steps to begin implementing these changes. Meeting subject: Arrive + Thrive Date: 10/16/2023 Overview: Staff presented an overview of the Arrive + Thrive planning process that is currently underway to update the 10 to 20-year-old plans around the city’s light rail stations and an area along Excelsior Blvd west of Hwy 100. Phase 1 engagement was completed earlier this year with over 150 participants providing feedback online, via surveys, and at in-person open house events. Staff conducted an existing conditions analysis reviewing current land uses, transportation network, environmental factors and economic conditions. From that, the project team developed a set of big ideas, four for each study area. The council discussed one big idea for each study area: • Louisiana gateway area. The existing station area plan focuses on employment and medical offices for redevelopment – as markets have changed since that plan’s adoption, what should redevelopment within the gateway area look like? Study session meeting of November 27, 2023 (Item No. 3) Page 4 Title: Housing + neighborhood-oriented development system wrap-up • West Excelsior gateway. There are two sites along the corridor with the largest potential for redevelopment: the former Jessen Press site and the former Party City site. What should redevelopment of these sites look like? • Wooddale Gateway. How can redevelopment of the Burlington/MicroCenter site complement the Wooddale gateway area? • Beltline gateway. How can the investments and redevelopment along Beltline Boulevard be used to catalyze the Raleigh Avenue and 35th Street area into a distinct district, with its own identity and redevelopment direction? Outcomes: Council provided feedback, comments and suggestions in response to the four big ideas. This feedback will be incorporated into the larger plan. Phase 2 engagement is ongoing, with events throughout October and November. The project team will take the information collected through community outreach and technical analysis and use that to develop a draft plan and implementation strategies and metrics. Staff will provide an update to council at the end of Phase 2 and prior to kick-off of Phase 3. Meeting subject: Wooddale Station Redevelopment Project Update Date: 10/16/2023 Overview: Council was provided with a written report updating the status of the Wooddale Station Redevelopment Project. Saturday Properties had entered into a preliminary development agreement with the EDA to redevelop the EDA-owned property immediately south of the SWLRT Wooddale Avenue Station stop. Due to adverse market conditions beyond their control, Saturday Properties notified the EDA that their proposed development was no longer financially feasible, and they were unable to proceed. Outcomes: Staff will seek new development proposals from qualified developers consistent with the city’s vision for the station area and will return to the EDA/council with a preferred proposal at a future date. Meeting subject: 2023 TIF Management Update Date: 10/23/2023 Overview: Stacie Kvilvang with Ehlers, the city’s financial consultant, provided an overview of the annual Tax Increment Financing (TIF) Management Report. The report concluded that: • Three TIF districts must be decertified at the end of the year. • Tax increment from eligible TIF districts should be pooled and deposited into the city’s affordable housing trust fund at the end of the year for affordable housing purposes. The report also recommended that: • The city continue pooling tax increment for affordable housing until the end of 2026 when the special legislative authority ends; and • The city elect to increase its pooling of tax increment by 10% within several TIF districts to the maximum allowable of 35% for affordable housing until the end of 2026 when the special legislative authority ends. Study session meeting of November 27, 2023 (Item No. 3) Page 5 Title: Housing + neighborhood-oriented development system wrap-up Jodie Zesbaugh with Ehlers and Shanique Williams with the St. Louis Park School District provided information and clarification relating to the impact of TIF on the school district. Outcomes: Council supported both recommendations. Meeting subject: Eviction Notice Ordinance Date: 10/23/2023 Overview: Staff provided an amended Eviction Notice Ordinance to the city council to align with the pending new State legislation requiring eviction notices. The amended ordinance included the following changes: • The current seven-day notice be increase to a 14-day notice • Any pre-eviction notice should be titled “Pre-eviction notice” and include: o The following statement: “You have the right to seek legal help. If you can’t afford a lawyer, free legal help may be available. Contact Legal Aid or visit www.LawHelpMN.org to know your rights and find your local Legal Aid office.” o The following statement: “To apply for financial help, contact your local county or Tribal social services office, apply online at MNBenefits.mn.gov or call the United Way toll-free information line by dialing 2-1-1 or 800-543-7709”; and o The following statement: “Your landlord can file an eviction case if you do not pay the total amount due or move out within 14 days from the date of this notice.” • The revised ordinance also encouraged rental property owners to utilize a recommended pre-eviction notice form provided by the city which would be translated into multiple languages. Outcomes: Council directed staff to further amend the ordinance to require use of the city- provided form and research the pros, cons and unintended consequences of increasing the notice period to 30 days. Staff will return to council in the first quarter of 2024 with the information requested. That state legislation requiring a 14-day notice is effective Jan. 1, 2024 and will supersede the city’s seven-day notice in the meantime. Meeting subject: Zoning Code Update Date: 11/13/2023 Overview: Staff presented phase 1 of the zoning code update currently underway, which focused on expanding the city’s housing types and increasing “missing middle” housing options. Missing middle housing consists of duplexes, triplexes, fourplexes, townhouses, row housing, courtyard cottages, low-rise apartment buildings and similar low- to mid-rise housing types. Staff and the planning commission reviewed the current residential zoning districts and how to convert them to new zoning neighborhood districts that are based on housing scale (house, low-rise, mid-rise high-rise). They also reviewed where these types of housing should be allowed under the city’s zoning ordinance. Staff presented a draft zoning map that takes a corridor approach that focused the N-2 zoning district along major transportation corridors. Staff requested feedback and comments on the general approach the planning commission is Study session meeting of November 27, 2023 (Item No. 3) Page 6 Title: Housing + neighborhood-oriented development system wrap-up taking to shift to zoning districts that are based on scale of housing and the general approach of the map focusing on corridors. Outcomes: Council was generally supportive of the approaches and expressed interest in the next steps. Community engagement of phase 1 will conclude in November. The planning commission will begin phase 2 of the zoning code update in December, with public outreach beginning after the first of the year. Meeting subject: Cannabis Zoning Discussion Date: 11/20/2023 Overview: Staff is in the early stages of researching and preparing zoning regulations pertaining to the sale of cannabis products. As part of this process, staff presented two policy questions to the city council related to the retail sale of adult use cannabis: 1. Should the city regulate the sale of cannabis edibles and beverages for on-site consumption in the same manner as the city currently regulates on-site consumption of low potency (LP) Tetrahydrocannabinol (THC) edibles? 2. Should the city regulate the sale cannabis for off-site consumption (dispensaries) in the same manner as the city currently regulates liquor stores? Outcomes: There was unanimous council support of staff’s recommendations related to on- site sales of adult use cannabis products (#1 above). Council expressed support for the liquor store framework in general for off-site sales (#2 above) but would like further discussion related to distances to other uses (e.g., schools, liquor stores, etc.) and concentration of dispensaries. Staff will conduct additional research and will return to council with recommendations and discussion. Meeting subject: City/EDA owned excess land disposition discussion Date: 11/20/2023 Overview: Staff provided an overview of the city’s policy for the disposition of public land which was adopted in 1997. The policy generally serves the intended purpose of regulating the disposition of public land; however, the policy needs updating to ensure it is meeting the needs of the community. Outcomes: Council was supportive of staff’s recommendation to update the policy. Staff will amend the policy and bring it back to council for action. Meeting: Study session Meeting date: November 27, 2023 Written report: 4 Executive summary Title: Via Sol development update – Ward 2 Recommended action: None. This report is a preliminary review of the proposed 8th amendment to the contract for private development and the proposed amendment to the planned unit development. Policy consideration: • Is the EDA/council willing to consider potential redevelopment contract and PUD amendments to enable the Via Sol development to be sold to a new property owner, and to secure its final certificate of occupancy and certificate of completion? Summary: PLACE E-Generation LLC’s (the “developer”) Via Sol development, located at 5855 State Highway 7, received a temporary certificate of occupancy (TCO) in July 2022. Subsequently, the developer defaulted under the documents relating to the bonds issued for a portion of the project, and at the request of bondholders, Hennepin County District Court appointed Maxwell Bay Advisors LLC (the “receiver”) as receiver in November 2022. A receiver is a person appointed as custodian of an entity’s property, finances, or general assets. The receiver in this case was tasked with overseeing the building’s finances, final completion and lease-up on behalf of the bond holders. In mid-August 2023, the receiver listed Via Sol for sale, and after a competitive bidding process, Bigos Management was selected as having the best overall proposal to purchase the Via Sol property. The parties have since entered into a purchase agreement. As noted in the Sept. 18, 2023 staff report, the receiver is requesting an 8th amendment to the contract for private development and an amendment to the planned unit development. Outlined in the following report is a summary of the requests that will be brought before the EDA and city council for formal consideration in the coming weeks. Financial or budget considerations: Staff and Ehlers, the EDA’s financial consultant, recommend the EDA resize the developer’s TIF Note to correspond to a proposed affordable housing 4d tax classification change, and recommend utilizing generated tax increment to repay the remaining balance on the developer’s property purchase loan with the EDA. Additional details are outlined below. Strategic priority consideration: St. Louis Park is committed to providing a broad range of housing and neighborhood oriented development. Supporting documents: Discussion Prepared by: Jennifer Monson, redevelopment administrator Reviewed by: Greg Hunt, economic development manager Karen Baron, community development director; EDA executive director Approved by: Kim Keller, city manager Study session meeting of November 27, 2023 (Item No. 4) Page 2 Title: Via Sol development update – Ward 2 Discussion Background: The EDA and PLACE E-Generation One, LLC (the “developer”) entered into a purchase and redevelopment contract on May 1, 2017, (as amended seven times, the “redevelopment contract”) for the redevelopment of the property to the north and south of the proposed Wooddale Avenue LRT station. At the same time, the city council approved a planned unit development to create the zoning for the development. In 2019 the purchase and redevelopment contract and planned unit development zoning district were amended to only include redevelopment north of the Wooddale Avenue LRT station. Per the contract and the zoning requirements, the developer was required to construct the following: • A five-story, mixed-use, mixed-income building with 217 dwelling units including eight live/work units, and approximately 5,000 square feet of commercial space. o 22 units affordable at 50% area median income o 130 units affordable at 80% area median income o 65 market rate units o Rooftop solar generation and a rooftop helical wind turbine • E-generation/greenhouse facility including an anaerobic digester and vertical greenhouse for urban agriculture. • A one-acre urban forest located parallel to the Cedar Lake LRT Regional Trail. • 220 parking spaces, distributed as 99 underground, 56 surface and 65 on-street parking spaces, along with five car-share spaces. As part of the contract, the EDA agreed to subordinate certain provisions of the redevelopment contract to the developer’s financing, which is customary. Construction background: Construction of the Via Sol development began in January 2020 and the city issued a temporary certificate of occupancy (TCO) in July 2022. All components of the mixed-use building (building, parking and urban forest) are complete, with the exception of the installation of rooftop solar panels, a solar canopy over the surface parking and the helical wind turbine. As written in the “planned unit development official exhibits”, these items are required in order for the project to receive a final certificate of occupancy. They are also required by the submitted construction plans. Compliance with the construction plans submitted by the developer to the EDA is required for the developer to receive a certificate of completion from the EDA under the redevelopment contract. Construction has not commenced on the E-generation and greenhouse facility. The developer intended to fund all energy generation facilities, including Via Sol’s solar panels, solar canopy and wind turbine from a separate funding source. The developer was unable to secure additional financial resources to complete all components of the project, and the building’s bond holders are unwilling to assume additional debt to complete this portion of the project. Despite the incomplete sustainable components noted above, the Via Sol building largely complies with the city’s Green Building Policy. Yet to be completed is the commissioning Study session meeting of November 27, 2023 (Item No. 4) Page 3 Title: Via Sol development update – Ward 2 process which assures that all the building’s mechanical systems are operating as originally designed. Financial background: In addition, the developer has paid $422,470 on the loan the EDA provided to the developer to enable it to purchase the property. The remaining principal balance of the land loan is $552,530. Compared to other housing developments in St. Louis Park, initial lease-up of Via Sol has been very slow. This, among other challenges, caused significant cash flow difficulties for the developer. As a result, Hennepin County District Court appointed a receiver in November 2022 to oversee the building’s finances, final completion and lease-up on behalf of the building’s financial lenders. Via Sol is currently managed by Roers Companies and, to date, the building is 80% leased and 77% occupied. The project’s affordability and leasing breakdown is in the table below. The building exceeds the requirements of the city’s Inclusionary Housing Policy and has submitted all required documentation to demonstrate compliance with the policy. The units affordable at 80% AMI are required as part of the approved redevelopment contract but exceed the requirements of the Inclusionary Housing Policy. These 80% AMI units are tied to the 501(c)(3) non-profit conduit revenue bonds issued for the project and are required by other project funders. Approved affordability levels Affordability level Approved units Leased units % Leased 50% AMI 22 20 91% 80% AMI 130 111 85% Market rate 65 43 66% Present considerations: In mid-August 2023, the receiver listed Via Sol for sale, and after a competitive bidding process, Bigos Management was selected by the receiver as having the best overall proposal to purchase the property. The parties have since entered into a purchase agreement. Buyer background: Bigos Management owns and manages 9,500 units in the Minneapolis/St. Paul area. 45% of these units are naturally occurring affordable housing (NOAH). It owns and operates several buildings in St. Louis Park and is currently constructing The Mera development at 9920 Wayzata Boulevard in the city’s Shelard Park area. Bigos Management also owns five fully affordable project-based communities in St. Louis Park serving 614 households and is one of the largest acceptors of housing choice vouchers in the city. Requested amendments to the contract for private development: Given the remaining challenges, the receiver and current lenders have requested relief from certain contractual requirements for the Via Sol development to receive its final certificate of occupancy from the city and certificate of completion from the EDA. In addition, Bigos Management (the “buyer”) requests additional changes to better position the building for full occupancy and positive cash flow. Study session meeting of November 27, 2023 (Item No. 4) Page 4 Title: Via Sol development update – Ward 2 • Amendment to the definition of minimum improvements: As detailed earlier in this report, the contract for private development with the EDA requires the installation of a wind turbine and solar panels on the apartment building, a solar canopy over surface parking, construction of an E-generation facility, as well as a demonstration that commercially reasonable efforts to achieve LEED certification for the development were used. The contract also requires 5,000 SF of commercial space be provided. Buyer’s request: The receiver requests the definition of minimum improvements be amended to remove the requirements of the E-generation facility, the rooftop solar and wind turbine and solar canopy over the surface parking lot. The receiver also requests the commercial space requirement be amended to allow this space to be used as an amenity area for the building such as a fitness center, community room, etc. Staff recommendation: Staff recommends the definition of minimum improvements be amended as requested, with the inclusion of language requiring the buyer to use best faith efforts to install rooftop solar within 18 months of receiving a certificate of occupancy. Staff also recommends allowing the commercial space to be used for building amenity purposes but allowing the opportunity for the space to convert back to commercial in the event of changing market conditions in the future. • Amendment to the project’s affordability levels: As approved, the apartment building is required to provide 22 (10%) units affordable to households at 50% or below of area medium income (AMI) and 130 units affordable to households at 80% AMI for 25 years. The building exceeds the city’s inclusionary housing policy that was adopted at the time of the preliminary development contract, which required 8% of the units to be affordable at 50% AMI. Buyer’s request: When Via Sol is sold, the 501©(3) non-profit conduit revenue bonds that were issued for the project will be repaid, removing the state’s requirement for the 80% AMI units. To make the new financing of the development work, Bigos Management requests the city amend the affordability requirements as outlined in the table below. This change in affordability would allow the building to qualify for a lower tax rate under the state’s 4d tax rate classification. Requested affordability levels compared to approved levels Affordability level Approved units Leased units % Leased Requested units 50% AMI 22 20 91% 22 60% AMI 66 80% AMI 130 111 85% 0 Market rate 65 43 66% 129 Staff recommendation: Staff recommend amending the affordability requirements as requested. The building will continue to meet the city’s inclusionary housing policy by providing 22 units at 50% AMI for 25 years and will exceed the policy’s affordability Study session meeting of November 27, 2023 (Item No. 4) Page 5 Title: Via Sol development update – Ward 2 requirements by providing 66 additional units at 60% AMI for a minimum of eight years. If, after eight years, the owners would like to continue to pursue the 4d tax class, they would be required to ask the EDA for an extension to the affordability of the 60% AMI units. Otherwise, the tax rate of the building would revert to a higher tax rate classification. 80% AMI units are not required under the inclusionary housing policy and the city has already exceeded its Met Council goals for 80% AMI units through 2030. Additionally, the 80% AMI units are challenging to rent due to the very narrow income range that allows households to qualify for the units. Existing renters in 80% AMI units that become 60% AMI units will not be displaced. The rents will be reduced to the 60% AMI level and the current tenant will be allowed to continue leasing the unit; the lease will not be non- renewed based on the over-income status. New tenants leasing the 60% AMI units will have to income qualify at the 60% AMI level initially. Given these factors, city staff find that eliminating the 80% AMI units and increasing the number of 60% AMI units is of greater benefit to the community. Therefore, staff supports and recommends the change. • Resizing of the TIF Note: A change in the tax classification rate of the building will affect the amount of property taxes generated by the development, thereby affecting the size of the TIF Note. As approved in the 6th Amendment to the contract, the EDA authorized $3.4 million in tax increment financing via a Pay-Go TIF Note. Staff recommendation: Staff and Ehlers, the EDA’s financial consultant, recommend resizing the TIF Note to account for Bigos Management’s request for the 4d tax classification of the affordable units. If the property owner pays a reduced amount of annual taxes, the TIF Note would be resized accordingly to a lesser amount. The resized note would be $2.066 million based on the net present value. • Repayment of the EDA land loan: To date, the developer has paid $422,470 on the loan the EDA provided to the developer to enable it to purchase the property. The remaining principal balance of the land loan is $552,530. This EDA loan is subordinate to the developer’s other sources of funding and is very unlikely to be repaid at the time of the building’s sale. Staff recommendation: Staff and Ehlers recommend the EDA utilize tax increment generated by the development to pay off the remaining balance of the land loan. Planned unit development: To allow for the issuance of the final certificate of occupancy from the city, an amendment to the planned unit development would need to be approved by the city council. The receiver intends to submit application for a major amendment to the planned unit development requesting the following changes: Study session meeting of November 27, 2023 (Item No. 4) Page 6 Title: Via Sol development update – Ward 2 • An amendment to remove the requirement of rooftop solar and rooftop wind turbine from Via Sol. • Removal of the E-generation and greenhouse uses as primary use on the western parcel. • An amendment to the site plan to extend the surface parking lot west to provide additional off-street parking for the Via Sol building, including: o Removal of the solar canopy from over the parking lot. o The addition of planting islands and additional trees within the parking lot. o The addition of more lighting and an easement on the west side of the parking lot to accommodate future public art. • An amendment to the site plan to relocate the grill area and replace this space with an outdoor pool and further amenities for Via Sol residents. • A text amendment to the PUD ordinance to allow residential amenities to be located within the space reserved for commercial uses. Staff recommends the amendment include language that would allow the space to be converted back to commercial use in the future, but the commercial use would no longer be required. Staff recommendation: Staff recommends the city council consider the above amendments to the PUD ordinance and changes to the PUD official exhibits to enable the Via Sol development to be completed, move forward and provide additional affordable housing for local area residents. Bigos Management is a fully capable mixed-income housing developer and manager. It accepts more Housing Choice Vouchers in its St. Louis Park buildings than any other multifamily housing owner in the city. Bigos Management also owns and operates several buildings in St. Louis Park that are required to adhere to the city’s Inclusionary Housing Policy. Additionally, Bigos Management is familiar with and is supportive of the city’s Green Building Policy requirements. For the past several years, city staff has had productive experiences working with Bigos Management to ensure compliance with the city’s various policies. Next steps: The EDA is scheduled to consider an eighth amendment to the contract for private development in December 2023 that would be contingent upon approval of subsequent PUD amendments by the city. The Planning Commission is anticipated to hold a public hearing on the PUD amendments in January 2024, and the city council is anticipated to consider the PUD amendments in late January 2024. Following these pending approvals, the receiver and Bigos Management plan to submit formal applications for building permits to expand the parking lot, add a pool area and construct additional building amenity areas. Once this work is completed, a certificate of occupancy can be issued. Following that, and once additional contract-required documentation is provided to the EDA, the certificate of completion and TIF Note can be issued.