01/10/2012 - City Council SpecialMINUTES
SPECIAL CITY COUNCIL MEETING
TUESDAY, JANUARY 10, 2012
5:30 P.M.
EAGAN ROOM — EAGAN MUNICIPAL CENTER
City Council members present: Mayor Maguire, Councilmembers Bakken, Fields, Hansen and Tilley.
City Staff present: City Administrator Hedges, Assistant City Administrator Miller, Director of
Administrative Services VanOverbeke, Fire Chief Scott, Community Development Director Hohenstein,
Community Development GIS Specialist Slettedahl, City Planner Ridley, Public Works Director Colbert,
Police Chief McDonald, City Engineer Matthys, Parks and Recreation Director Seydelll Johnson, Planner
Thomas and Planner Dudziak.
I. ROLL CALL AND ADOPTION OF THE AGENDA
Councilmember Tilley moved, Councilmember Fields seconded a motion to adopt the agenda as
presented. Aye: 5 Nay: 0
II. VISITORS TO BE HEARD
There were no visitors to be heard.
III. JOINT MEETING WITH EAGAN'S LEGISLATIVE DELEGATION
Mayor Maguire welcomed State Representatives Wardlow and Anderson, and State Senator Daley. It
was noted that Representative Hansen and Senator Metzen were unable to attend this evening.
City Administrator Hedges stated that it is an annual tradition of the City Council to invite Eagan's
legislative delegation to the first meeting of the year to dialogue with the Council regarding legislative
issues anticipated during the 2012 session. City Administrator Hedges summarized the 2012 legislative
priorities of the City.
The City Council and delegation discussed priorities and areas of focus for 2012.
Mayor Maguire thanked the legislative delegation for attending the meeting and thanked them for their
service to the community.
IV. NAVIGATING THE NEW NORMAL
(JOINT MEETING WITH THE ADVISORY PLANNING COMMISSION)
Mayor Maguire welcomed the members of the Advisory Planning Commission in attendance. Maguire
also welcomed Gordon Hughes and Cathy Benriett, coordinators of the Navigating the New Nornial
program through the Urban Land Institute of Minnesota.
City Administrator Hedges noted that the Urban Land Institute of Minnesota developed the Navigating
the New Normal program as a tool for cities interested in having better understanding of factors affecting
development and redevelopment in the economic environment that is evolving as a result of the Great
Recession. Hedges added that the Navigating the New Normal program utilizes some of the community
change data that was developed in the Opportunity Cities program to define residential potentials and
applies it more generally to all types of physical and economic development.
Special City Council Minutes
January 10, 2012
Page 2
Community Development Director Hohenstein introduced Gordon Hughes and Cathy Bennett, who gave
a presentation on navigating the New Normal.
Caren Dewar, Executive Director of ULI, thanked the City for its participation in the New Normal and
Opportunity Cities programs.
Mayor Maguire welcomed the panel members present to discuss the New Normal, which included: Eric
Anderson, New Perspective Senior Living; Jay Lindgren, Dorsey and Whitney; Mark Ruff, Ehlers
Financial; and John Shardlow, Stantec.
The City Council, members of the Advisory Planning Commission, and the panel discussed the New
Normal and its implications to the City of Eagan. The following topics were discussed:
In the current recovering economy, collaboration between local govermnents and developers is becoming
increasingly important. As lenders and investors are requiring more equity and preleasing and less risk,
the margins and return on investment is tightening. In the aftermath of the Great Recession, there are
fewer developers and fewer deals and developers are more selective about where they choose to invest
and take risk. Some developers look to local governments to reduce standards or participate financially in
projects as means of reducing risks or costs. Cities should consider whether they wish to do so or rely
more on the market to arrive at appropriate property prices.
It was suggested that cities consider setting clear goals in addition to the use standards in their
Comprehensive Plans and zoning codes. In the current economy, developers can only spend a certain
amount on "pursuit costs ". As a consequence, clear expectations, streamlined processes and a partnership
mentality between the City and developers of desirable projects can make the difference between a
project occurring and not. The key is to increase predictability in the process and the likelihood of
particular options. In order to manage its high growth period, Eagan's philosophy was necessarily one of
managing growth. The need for some management will continue, but the city may also want to consider
how best to facilitate certain types of growth that it hasn't done as much in the past.
In the near term, there is not enough capacity in the development or capital markets for big projects.
Small projects with lower risk are the most likely to be completed. One way for a city to help lower the
risk is by doing property assembly, removing barriers and preparing a site for new development. It was
noted that the FDA's decision to proceed with the acquisition of properties in Cedar Grove is an example
of that. It was important to have all of the property under control for redevelopment. Panelists compared
acquiring and holding property at Cedar Grove until the market will support redevelopment to Edina's
experience with Centennial Lakes. A city's vision, staying power and patience helps bring about better
outcomes.
Changing demographics will drive demand for additional numbers and kinds of rental housing options.
In addition to the Generation Y preference for rentals for mobility, more empty nesters and others will be
interested in rental options. While vertical mixed use is hard to accomplish in the suburbs, horizontal
mixed use or closer locations of different uses can be financed and developed. Both younger and older
demographics like shopping within walking distances of their homes.
While tax increment is the most common public financing tool to support development, developers may
ask for the city to bond for special assessments for public improvement costs specific to a project. In
some cases, they are also asking for the waiver or reductions or fees or dedications or the use of TIF or
tax abatement as a means of flattening property tax costs for a period of time. A city may or may not
Special City Council Minutes
January 10, 2012
Page 3
choose to consider these tools, but they should discuss whether they would consider them as part of their
development policies.
The panel noted that Eagan has a strong reputation and good relationships with developers. It has been
important to them to get clear direction and for the City to avoid the slow no, when something does not
meet its goals or expectations.
City Administrator Hedges summarized the discussion. He rioted some of the key points being the
importance of revisiting the City's policy on public financing assistance, the value of clear goals and
patience for redevelopment, the need to provide developers and the community with clear expectations
for development and redevelopment and the need to recognize different demographic expectations for
housing and its proximity to retail and other services.
Mayor Maguire thanked the panelists and all the participants in the discussion. The City Council
discussed the recommendations of the panel and suggested further review and efforts to package the
City's goals, financial options, etc. with regard to the City's development and redevelopment efforts.
There was no Other Business.
V. OTHER BUSINESS
VI. ADJOURNMENT
Councilmember Tilley moved, Councilmember Bakken seconded a motion to adjourn at 7:30 p.m. Aye:
5 Nay: 0
D,- a \--f Q
Date
110e, ��
Mayor
City Clerk