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07/21/1992 - City Council Special • AGENDA SPECIAL CITY COUNCIL MEETING Tuesday July 21, 1992 5:00 p.m. I. ROLL CALL/ADOPT AGENDA II. CEDARVALE UPDATE III. OTHER BUSINESS IV. ADJOURNMENT The City of Eagan is committed to the policy that all persons have equal access to its programs, services, activities, facilities and employment without regard to race,color, creed, religion, national origin, sex, disability, age, marital status or status with regard to public assistance. Auxiliary aids for persons with disabilities will be provided upon advance notice of at least 96 hours. If a notice of less than 96 hours is received, the City of Eagan will attempt to provide such aid. MEMO TO: HONORABLE MAYOR AND CITY COUNCILMEMBERS FROM: CITY ADMINISTRATOR HEDGES DATE: JULY 2, 1992 SUBJECT: SPECIAL CITY COUNCIL MEETING/JULY 21, 1992 At the July 7, 1992 regular City Council meeting, a special City Council workshop was scheduled for 5:00 p.m., Tuesday, July 21, at the Municipal Center building in Conference Rooms A and B. The purpose of the meeting is to discuss the Cedarvale Study and any other business appropriate for a workshop session. Enclosed on pages c2 through D is a copy of the Executive Summary for the Cedarvale Study that was prepared by Jim McComb of McComb & Associates for your review. If any member of the City Council has misplaced the full study and would like an additional copy, feel free to contact the City Administrator's office. Also enclosed on pages ? through /D is a copy of the Economic Development Goals which include review and consideration of economic/distressed commercial districts such as the Greater Cedarvale Area. There is no specific other business at this time unless there is sufficient time for an update by the Personnel Committee on their recent meeting and an update by City Councilmembers Awada and McCrea on their recent meeting with Anthony Caponi to resolve matters pertinent to the Diffley Road improvements and the Art Park Project on behalf of the City Council. /S/ Thomas L. Hedges City Administrator Executive Summary CEDARVALE FINDINGS AND RECOMMENDATIONS This report provides a comprehensive analysis of the Cedarvale shopping area, including its current characteristics, trade area and purchasing power, competition and problems confronting existing businesses. This section summarizes key findings related to each of these areas and then details recommendations to improve business prospects in the area. Site Evaluation The Cedarvale study area includes land use classifications for general business, neighborhood business, community shopping center and industrial. These zoning land uses are generally consistent with existing uses in the area and those that could occur in the future. The neighborhood business classification for the Silver Bell Center area is appropriate as is the general business classification for the area between Cedarvale Boulevard and Highway 13. The commercial area south of Silver Bell, categorized as community shopping center, is consistent with uses that currently exist or are likely to locate there in the future. The area west of Highway 13 should continue to develop with business and industrial uses similar to those now located in the area. The Cedarvale commercial area contains a mix of retail, restau- rants, entertainment, recreation and retail services and business services in three shopping centers and a business center. Vacant buildings and changing building uses testify to the evolving nature of business activities in the area. Access and Visibility State Highways 13 and 77 provide excellent regional access to the Cedarvale area. Traffic counts are high, particularly on Highway 77, with over 62, 000 trips daily and almost 20,000 trips on Highway 13. Limited visibility of the Cedarvale area from Highway 77 and to some extent 13 negate much of the potential benefit that could be derived from these high traffic volumes. Visibility of the Cedarvale area, particularly south of Silver Bell _Road, from these highways is poor at best. McDonalds, Silver Bell Center and Express Donuts enjoy the best visibility of any business establishment in the area other than U-Haul, which has a very visible pylon sign. iii Cedarvale developed when Highway 13 and Cedar Avenue (Highway 77) intersected with an at-grade intersection. Since Cedar Avenue was reconstructed to freeway standards, visibility and accessibility to the commercial area has suffered a significant reduction and properties that had enjoyed high visibility and strong access were left with poor access and poor visibility. The change in accessibility and visibility has compounded inherent problems represented by inconsistent and confusing building orientation that exists in the area. This is most evident in the area between Silver Bell Road and Rahn Road where most businesses orient either toward Cedarvale Boulevard or Beau D'Rue Drive. Vacant commercial and industrial buildings contribute to the poor visual impression. Building orientation in the Cedarvale area is confusing due to obsolete road patterns and parcel sizes. These parcel and building locations make sense based on the existing road network. However, the road network and development patterns are confusing to tenants and customers familiar with contemporary land use patterns for shopping areas. Visual Issues Silver Bell Road is the main entrance to the Cedarvale Commercial area. The visual impression at this intersection is marred by the industrial buildings, vacant buildings and deferred maintenance on commercial structures. Businesses located to the south along Cedarvale Drive suffer from poor visibility from this intersection. The overwhelming visual image of the Cedarvale commercial area east of Highway 13 is one of deterioration and lack of concern by property owners. This impression overwhelms the positive images of the few businesses that have maintained their property. Cedarvale Trade Area Cedarvale's trade area was delineated based on the results of. business interviews and freeway and highway arterial access supplemented by firm knowledge of shopping center trade areas and retailing patterns in the Twin Cities. The Cedarvale trade area is comprised of the cities of Eagan, Apple Valley, Burnsville and Rosemount. Cedarvale can expect to draw 80 to 85 percent of its sales from within this trade area. The - remainder of Cedarvale's resident-based sales are expected to be derived from persons residing outside the trade area, primarily from employees. iv 1 Employment has grown rapidly in Eagan, reaching an estimated 20,700 in 1990. The Cedarvale trade area has grown rapidly during the Eighties, increasing to an estimated .142,000 people and 50, 500 households. Household incomes in 19;0 averaged $48, 800 and are expected to increase almost $57,000 by 1995. Average family incomes were estimated at about $54,000 in 1990 and are estimated to increase to almost $65,000 by 1995. It is estimated that aggregate 1995 income for the Cedarvale trade area will exceed $3. 5 billion. Approximately one-third or $1.2 billion will be spent on shopping, dining, entertainment, recre- ation and services. Business Interviews Interviews indicated that Cedarvale customers are primarily in their thirties and forties with children. Their shopping frequency varies from one to three times per week to the seasonal visit depending on the business. Customers primarily reside or work in Eagan or its adjoining cities of Apple Valley, Burnsville and in some cases Rosemount. Business owners and managers felt the main strengths of the Cedarvale area were the age of the commercial area, established residential neighborhoods which create a sense of permanency and familiarity with the area. Other strengths included its expansion potential and the presence of Grand Slam and U.S. Swim and Fitness and the upgrading of the Cedarvale Mall interior. Business owners and managers were candid about area problems, including access, lighting, building maintenance, street, median and curb maintenance, weed and shrub control and the overall rundown image of the area. Competition • The Cedarvale commercial area faces competition from a host of new shopping centers that have developed in Eagan over the past ten years. These centers have greatly reduced the functional trade area for neighborhood and community center type services. This has led to the evolution of the Cedarvale area as a convenience center (Silver Bell Center) and a location for destination type business- es: Grand Slam, U.S. Swim and Fitness and Eagan Bowl. This evolution of businesses has served to increase the size of the trade area to include the four communities discussed previously. v . RECOMMENDATIONS Implementing recommendations to improve occupancies and business performance in the Cedarvale shopping area will require coordinated and cooperative action between governmental units, property owners and businesses. These actions should be focused on improving visibility and access, rationalizing land uses, correcting deferred maintenance and coordinated merchandising and marketing. Each of these areas is discussed in greater detail in this section. Visibility Cedarvale commercial area visibility needs to be improved from both Highways 77 and 13. This could be accomplished by the following: o Erecting pylon signs with visibility characteristics similar to existing U-Haul sign for major shopping destina- tions. These signs should be large enough to attract attention and be easily read from automobiles on the two highways. o Trees and weeds in the former Highway 13 right-of-way area should be removed to improve visibility of the commercial area. o Mature pine trees in the vicinity of Cedarvale mall should be removed and replaced with plantings that will maintain a lower profile. o The Cedarvale commercial area needs visual identity as a commercial area. This could be accomplished by creating entrance identity at Silver Bell Road to create a sense of arrival. In addition, consistent identifying treatment should be used within the public and private areas to create a sense of unity. This could consist of street landscaping, lighting, banners or other approaches that • experts could suggest. Design consultants should be engaged to provide solutions. • Access Access to the Cedarvale shopping area from Highway 13 should be improved. Possible improvements include the following: o Access from Highway 13 for traffic from the southwest and south could be measurably improved by a right-turn lane off Highway 13 that would connect with Rahn Road. This would . provide much better visibility for Cedarvale Mall and businesses located to the south. While there may be design concerns related to this recommendation, it would greatly vi Ltc- improve accessibility to trade area residents living south along State Highway 77. o Consultant studies have recommended reconfiguring the intersection of Silver Bell and Cedarvale Drive in the vicinity of Express Donuts. This solution should be pursued. o Entrances to commercial properties along Cedarvale Boule- vard should be studied to determine if they are in the best location to provide both visibility and accessibility to ' the individual properties. Maintenance Business owners and managers commented about property. maintenance as related to both public and private spaces. These issues were readily apparent during the course of this study. Maintenance issues that should be addressed within the Cedarvale area include the following: o Right-of-way areas, both local and state controlled, should be properly maintained. Roadway surfaces should be in good repair. Landscaped areas should be mowed and plants trimmed to maintain a well-cared for look. o Owners of vacant buildings representing obsolete uses and those with characteristic franchise architecture should have them demolished and the site cleared. These sites have more potential as vacant land than for reuse of the existing buildings. o Buildings with improper street orientation should be either reconfigured to provide proper orientation or demolished. o Deteriorated parking areas should be repaired and paved and striped to present a properly maintained image to custom- ers. The parking lot is the customer's first pedestrian area in the shopping experience and should be treated with more concern than is evident at many of the properties in the Cedarvale area. o Parking areas should be properly lighted to create a feeling of confidence and safety during evening hours. o Building exteriors should be repaired, painted and updated as necessary to present a properly maintained image to the public. There are numerous examples of poorly maintained buildings with deteriorated signage, missing signage, peeling paint and other indications of deterioration. vii 6 Land Use Land use within the Cedarvale area should be rationalized to conform with contemporary commercial standards. Consideration should be given to eliminating the industrial uses in the area of Silver Bell Road between Cedarvale Boulevard and Beau D'Rue Drive. This is a highly visible location for the commercial area and these buildings create the wrong visual impression. In the area south of Cedarvale Mall, buildings and land use area should be studied and improved as part of a program to strengthen commercial activities in the area. Cedarvale is the location of many automobile service and supply type businesses. Some of these businesses are located west of Cedarvale Drive, along with other uses. Concentration of auto oriented uses in this area should be pursued as a long-term objective. The area south of Silver Bell Road should be redevel- oped with destination type uses consistent with the merchandising recommendations contained in the next section. Merchandising The Cedarvale commercial area must evolve into a different type of retail area than has existed in the past. Some of the existing businesses and new business which have located in the area provide support for this recommendation. This recommendation is also supported by the types of businesses that have left the area. Area businesses that appear to be doing well are destination uses, including restaurants, entertainment and fitness. The personal and business services, convenience shopping and automotive uses also appear successful. These businesses provide a strong basis for further redevelopment and merchandising activities. Cedarvale should focus on becoming a location for destination businesses which focus on serving the following areas: • o Families with children o Fitness and health o Dining o Entertainment o Outdoor activities o Sporting goods o Personal services o Business services o Automotive supply and repair These businesses will draw their primary support from the trade area, but can serve as a destination for residents of a broader area. Grand Slam has already achieved this objective. viii r Business uses consistent with this orientation include the following: Retail Tenants Play It Again Sports Team Center Penn Cycle GBS Sports Merle Norman's Fan Fair Pro Golf-Nevada Bob's Shields Midwest Mountaineering • Herman's Kokesh Burger Brothers Bwana Archers Hoigaards Scuba Outlet Midwestern Water Sports Strauss Skate & Bicycle Gymboree Croquet America Soccer Field Racquet Specialists Restaurants Grandma's Main Event Champs Macaluso's Sports Bar & Grill Old Country Buffet TGI Friday's Samurai These specific businesses may or may not be interested in locating in Cedarvale. They are. cited to provide a general idea of the business uses that are consistent with the overall merchandise concept. Marketing • Businesses located in the Cedarvale commercial area should cooperatively market to trade area households creating a unified marketing image for the area. This should include focusing on target markets for businesses located in the area and sponsoring events that will attract customers. These activities are needed to establish Cedarvale' s location and business activities in the minds of trade area residents, most of whom are new residents, and more than likely, have no idea that Cedarvale exists. Cedarvale businesses need to assume that most trade area residents don't know they exist and market as if they were new businesses in the area. The above recommendations cover a broad range of issues and areas of concern. Recommendations concerning visibility, access and maintenance are critical to future success of the commercial area. Without specific attention to these areas of concern it will be difficult to achieve success in the merchandising area and build a healthy base of business in Cedarvale. ix . CITY OF EAGAN ECONOMIC DEVELOPMENT GOALS 8/6/91 1 . Retain, Expand and Diversify Tax Base - Reep residential property taxes as low as possible through broad, substantial tax base - Limit adverse effects to community's revenue position due to economic conditions - Achieve economies of scale available for larger concentrations of property value 2 . Retain, Expand and Diversify Employment Base - Provide job opportunities for Eagan residents Limit dependence on narrow job categories - Enhance buying power for Eagan businesses' goods and services 3 . Enhance the Image and Visibility of the City - Encourage sense of community and community identity through recognition of City as economic activity center, corporate headquarters, etc. - Enhance external image of City as economic destination, corporate center, etc. - Develop identity as major economic center in addition to the Minneapolis/St . Paul central business districts as Bloomington/494 strip is doing. 4 . Attract Primary Dollars from Outside the Community - Produce goods and services sold outside of the community in regional , statewide, national and international markets such that dollars are brought into the community and not just circulated within it. - Improve Eagan ' s ability to attract shoppers and service users from outside of the community from the freeway and highway system. 5 . Retain, Expand and Diversify Retail and Service Facilities for Eagan Residents , Employees and Businesses - Create massings and synergies of retail activity - Provide a broader spectrum of locally available choices in the areas of retail goods and services to reduce the outflow of Eagan dollars to other communities and to reduce Eagan residents' dependence on long car trips for goods and services . 6 . Create Massings of Economic Activity - Create focuses and areas of commercial/industrial , retail and hospitality/entertainment activity that will natually encourage related and spin-off businesses. - Encourage substantial development of existing economic activity areas within context of Comprehensive Land Use Guide Plan. 9 ECONOMIC DEVELOPMENT TARGETS ti 1. Commercial/Industrial - Encourage Head of Household Job Formation - Attract Clean Industry/Manufacturing - Attract Service Industries - Encourage Expanded Business Service Sector Promote Eagan as Location for Headquarters and Branches of Major Companies 2. Hospitality - Attract Visitors and Tourism Visitors and Convention Bureau - Capitalize on Mall of America Market and Traffic Expand Lodging Opportunities for Local Businesses 3. Retail - Capitalize on Mall of America Market and Traffic - Explore Other Regional Market Opportunities s - Attract Larger/Major Anchors - Encourage Big Ticket Retail such as Auto and Marine - Facilitate Revitalization/Redevelopment of all depressed areas Specifically: Men's and Women's Fashions - Upscale Grocery - Department/Junior Department Stores - Furniture - Full-Service Sporting Goods - Electronics - Office Supplies/Stationary - Camping Outfitters - Hobby and Crafts Home Maintenance 4 . Entertainment/Service - Expand Available Food and Beverage Options - Promote Youth-Oriented Entertainment Attract Evening Entertainment Opportunities Specifically: - Upscale and Ethnic Restaurants - Theaters - Racquet Sports Golf Facilities JD MEMORANDUM TO: Tom Hedges, City Administrator FROM: City Attorney's Office PRIVILEGED AND CONFIDENTIAL DATE: Ju]Ly 17, 1992 RE: Project 578/Greer Assessment Appeal Our. File No. 206-9773 As you may recall from our latest memo on this matter, the City of Eagan was successful in its argument before the Minnesota Board of Appeals in sustaining the dismissal of an assessment appeal brought by the Greers. The dismissal centered around the failure by the Greers through their attorney to properly file their Notice of Appeal with the District Court within the time frame set forth in the statutes. Following the City Council meeting on July 7, 1992 , I requested direction from the City Council in connection with a request by the Greers' attorney, Joe Christenson to seek to settle the Greers' claim against the City somewhere around $. 50 on the dollar of the assessment. As you may recall, the Council was not inclined to settle this matter for anything less than the amount of the total assessment particularly in light of the fact, that the Greers next door neighbor had lost her appeal at the trial court. Yesterday I had an opportunity to meet with Joe Christenson, whom again, sought to try to reach an accommodation for his clients. His clients still have until the end of July to contest the decision by the Court of Appeals to the Minnesota Supreme Court. Any such action would necessitate an expense of a couple of thousand dollars to the City. Mr. Christenson's present offer to the City in return for waiving the Greers' right of appeal, would be to have the City remove the sanitary lateral from the assessment roll at this time. The sanitary lateral assessment is in an amount equal to $4 , 129 . 50. Mr. Christenson's alternative would be that this amount would be payable by the Greers and/or their successors at the time that the Greers' septic system fails to work or prior thereto if they should choose to connect to the City system. This payment would be made in lump sum prior to their connecting to the system. Mr. Christenson explained that the Greers are elderly homeowners whom could not "afford" to bear the total costs of the assessments. He indicated that the Greers' mortgage company paid the first half of the taxes and assessments due against the parcel and have adjusted the monthly payment due from the Greers to account for the large IL . increase required in their tax escrow for the payment of the assessments. This increase has forced the Greers to not be able to make their monthly payments and they risk the loss of the property to the mortgage company as a result. Mr. Christenson indicated that obviously he would provide "assistance" to his clients so that they would not ]Lose their property, but was hoping the City would likewise help the Greers under the circumstances. Our analysis of Mr. Christenson's offer is that there is merit toward reducing the City's exposure to attorney's fees in return for obtaining the full amount of the assessment. Mr. Christenson does not seek to reduce the obligation of the Greers, but rather seeks to defer the payment for the sanitary sewer lateral only. Again, these monies would be collected at the time that the Greers were to connect to the sanitary system. I mentioned to Mr. Christenson that we would review this matter with the appropriate officials at the City and hoped to get him a response following the next City Council meeting. If you have any questions or concerns regarding this matter, please give me a call otherwise I will be happy to discuss this item with you on Tuesday afternoon. MGD/wkt