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06/14/2022 - City Council Regular   SPECIAL CITY COUNCIL MEETING    TUESDAY  JUNE 14, 2022  5:30 P.M.  EAGAN ROOM – EAGAN MUNICIPAL CENTER    AGENDA        I. ROLL CALL AND ADOPTION OF THE AGENDA     II. VISITORS TO BE HEARD    III. DAKOTA COUNTY UPDATE    IV. BILLBOARD/OFF PREMISE SIGNAGE REVIEW    V. CENTER FOR ECONOMIC INCLUSION UPDATE ON RACE, EQUITY, AND INCLUSION  EFFORT    VI. RENTAL LICENSING UPDATE    VII. OTHER BUSINESS    VIII. ADJOURNMENT        Agenda Information Memo June 14, 2022 City Council Workshop III. Dakota County Update Direction For Consideration: Review Dakota County update Facts: ➢ Dakota County Commissioners Laurie Halverson and Joe Atkins requested an opportunity to provide an update to the City Council. ➢ Both commissioners will attend the June 14 workshop to dialogue with the Council. ➢ Commissioner Atkins noted topics he hopes to discuss include the new arrangement for Dakota911 (formerly the DCC), road construction, and the status of the US Amateur Sports & Training Center study. Attachments: None Agenda Information Memo June 14, 2022 Special City Council Workshop IV. Off-Premise Dynamic Signage (Digital Billboards) Direction for Consideration: Provide direction to staff regarding City Code requirements for off-premise dynamic signs (digital billboards). Background  In late 2021, Blue Ox Media approached the City with a proposal to construct an off- premises dynamic sign (i.e., digital billboard) on City-owned property.  Subsequent to City Council direction, staff has researched the history of Eagan’s off- premises signs ordinance, the City’s existing criteria regulating off-premises signs, characteristics of the proposed site, and potential amendments to the City’s existing sign ordinance to allow additional off-premises signs.  Research was presented to the Advisory Planning Commission at their March 22, 2022 work session meeting at which Blue Ox Media was in attendance, provided a brief presentation, and responded to Commissioner questions.  The attached memo and exhibits summarize staff research and APC feedback regarding off-premised dynamic signage. Policy Questions 1) Does the City Council support changes to the City Code to allow additional off-premise signage? 2) If so, does the City Council support formation of a task force or commission of a study, similar to what was done in 1993 and 2007, to better understand the implications of changes to the Sign Code? Attachments (5):  Background memo to City Administrator Miller dated May 13, 2022  Presentation  Table of existing off-premise signs  Map of existing off-premise signs  Survey of existing off-premise signs MEMO To: Dianne Miller, City Administrator From: Jill Hutmacher, Community Development Director Date: May 13, 2022 Subject: Off-premises Signs Research Summary Background In late 2021, Blue Ox Media approached the City with a proposal to construct an off-premises dynamic sign (i.e., digital billboard) on City-owned property. Subsequent to City Council direction, Planning staff has researched the history of Eagan’s off-premises signs ordinance, the City’s existing criteria regulating off-premises signs, characteristics of the proposed site, and potential amendments to the City’s existing sign ordinance to allow additional off-premises signs. History In November 1991, the City Council denied a request for a billboard. In spring 1992, the City Council approved a moratorium on billboards and created a Sign Task Force to study the issue. In March 1993, the City Council approved a “no net gain policy” for billboards. The current off- premises sign ordinance is based on the work of the Sign Task Force. A 1993 billboard survey showed 14 billboard locations, 28 surfaces, and 8,405 square feet of signage. In response to the initial installation of electronic digital billboard signs in late 2006, a number of cities in the region, including Eagan, enacted moratoriums on the placement of additional signs of that type, to permit them to study and consider additional regulations. The City of Eagan enacted its moratorium in January 2007. The City of Eagan joined with the League of Minnesota Cities (LMC), which was coordinating a joint study on behalf of its member cities. At that time, the City of Minnetonka had commissioned a study by SRF both to provide the basis for its own consideration of additional regulations and to better define the issues associated with such signs. Following the adoption of its own ordinance in June 2007, Minnetonka agreed to permit LMC to use and distribute the SRF study for use by its members. Since 1993, the City of Eagan’s stated intent had been to cap and, if possible, reduce the number of off-premises signs in the community. At a September 2007 work session meeting, the City Council concluded that the existing language regarding the amount of off-premises signage should be retained. The City Council further directed that Eagan should use an incentive approach similar to that implemented by the City of Minnetonka that allows off-premises signage to be converted to digital signage in exchange for a public benefit of a reduction of overall off-premises signage or public service messaging. Since 1993, as a result of the City ordinance restricting new off-premises signs and offering incentives for the reduction of off-premises signage, off-premises signs have been reduced from 14 (1993) to 11 (2007) to 8 (2022). Eagan’s Current Off-premises Sign Regulations • No new signs, sign faces, or sign square footage is permitted except when there is a corresponding reduction in signs, sign faces, or sign square footage. • No sign shall exceed 40 feet in height. • Maximum sign size is 250 square feet unless a reduction in total signs, sign faces, or sign square footage occurs elsewhere in the City. • No sign shall be placed on a platted lot which contains a business sign. • No sign shall be located nearer to any other off-premises sign than 1,500 lineal feet on the same side of the street or 300 lineal feet on the opposite side of the street. • No sign shall be located within 300 feet of any freestanding ground sign or pylon sign. • New off-premises signs shall not be placed upon any property upon which a building or structure already exists. (Subdivisions are required to meet minimum lot standards for the zoning district.) • New off-premises signs may only be located on a property zoned for business or industrial use. • Existing off-premises signs may be converted to digital off-premises signs if either a) one sign surface is permanently removed or b) the sign is used to provide at least five hours per month of community and public service messaging. Champlin Digital Billboard Blue Ox Media has entered into a lease agreement with the City of Champlin to construct a digital billboard on city- owned property. The remainder of this memo assumes that the sign proposed by Blue Ox Media in Eagan would be similar to the Champlin sign in size and scale. • Located on northbound Highway 169 on a City- owned site. • The sign has two sign faces (north and south) with 672 square feet of signage per face. The sign is approximately 40 to 50 feet high. • As stated in local media reports, the billboard is expected to generate $2.2 million in revenue for the City of Champlin over a 20-year term. • The subject sign is the only digital billboard in Champlin. Champlin’s sign ordinance limits off-premises digital signs to a maximum of one sign. Eagan’s City Attorney has advised that the City cannot amend its ordinance to allow only one additional sign on city-owned property. If Eagan’s sign ordinance is amended, criteria must be established to allow private parties to construct additional off-premises signs. Proposed Eagan Site • Located on northbound I-35E immediately south of Northwood Parkway. • Proposed site is zoned Planned Development and is guided Retail Commercial. • Located approximately 450 feet from a residential zoned district (Glen Ponds Apartments). • Depending on the final site placement, the sign may need to exceed the 40-foot height maximum due to restricted visibility for southbound traffic because of the proximity of the Northwood Parkway bridge. APC Review The Advisory Planning Commission discussed billboards at its March 22, 2022 workshop meeting. Blue Ox Media presented information about digital billboards and their proposal. Feedback shared by commissioners included the following: • A billboard placed along a highway may be appropriate, but more discussion regarding the benefits and aesthetic impacts is warranted. • Dynamic signs are a greater distraction to drivers than static signs. • The revenue generated by one billboard may not be significant to a city of Eagan’s size. • Additional revenue may not outweigh negative impacts. • Expansion of digital billboards conflicts with the City’s sustainability goals. • It would be helpful to understand whether the community’s opinion on billboards has changed since the 1990’s. Conclusion The City of Eagan amended its off-premises sign ordinance in 1993 following a moratorium and the creation of a Sign Task Force. The City amended its ordinance again in Fall 2007 following another moratorium and with guidance from the LMC and an SRF study commissioned by the City of Minnetonka. In the past 30 years, the City’s off-premises sign ordinance has not been challenged by litigation and has met stated City goals of limiting or reducing the number of off- premises signs. Staff reviewed the sign ordinances of several peer communities with extensive freeway frontage. Bloomington has deemed all billboards in existence as of August 6, 2009, as nonconforming. Electronic (dynamic) displays are limited to one image per 20 minutes. Minnetonka has classified all “Outdoor advertising displays” existing as of March 13, 1991, as nonconforming. Minnetonka’s sign code offers a similar incentive program eliminating nonconforming signs in exchange for use of dynamic display signage. Neither Minnetonka nor Bloomington permit new billboards. Eden Prairie prohibits all billboards. If the City Council chooses to proceed with the Blue Ox Media proposal for a sign located on City- owned property south of Northwood Parkway, ordinance amendments may be required to provide greater flexibility for the number, height, and size of off-premises signs. The appropriate distance from residential zoned districts should be considered for signs that exceed 250 square feet. Furthermore, because the City Attorney has advised that the City cannot amend its ordinance to create a financial benefit for itself only, the City may need to consider greater flexibility regarding off-premises sign locations. Given the number of potential amendments to the existing off-premises sign ordinance, City staff is unable to predict the outcome of ordinance amendments in terms of the number or locations of additional off-premises signs. If the City Council directs staff to proceed with amendments, formation of a task force or a third-party study may be warranted similar to the processes used in 1993 and 2007, respectively. Off-Premise Dynamic Signage City Council Work Session June 14, 2022 Background Nov 1991 –City denied request for billboard Spring 1992 –Billboard moratorium and Sign Task Force created March 1993 –“No net gain policy” approved Jan 2007 –Digital billboard moratorium, LMC research, SRF Study Sept 2007 –No change to existing Sign Code, incentive approach for digital billboard conversion Number of Billboards 1993 14 2007 11 2022 8 Current Sign Code •No new signs or sign square footage without corresponding reduction in signs or sign square footage •40-foot height maximum •250 square foot maximum unless reduction happens elsewhere •No signs on lots with business signs •No signs on developed properties •Not less than 1,500 feet away from off-premise signs on the same side of the street (300 feet on opposite side) •Must be zoned for business or industrial use •Digital conversion only if a) one sign surface is permanently removed or b) sign provides five hours of public messaging per month Champlin Digital Billboard •Northbound Hwy 169 on city-owned site •2 faces with 672 square feet per face •40-to 50-feet high •$2.2 million revenue over 20-year term •Only digital billboard in Champlin •Ordinance restricts additional billboards •Per City Attorney, Eagan cannot amend ordinance to allow only one City-owned billboard Proposed Eagan Site •Northbound I-35E south of Northwood Parkway •Zoned Planned Development, guided Retail Commercial •Approximately 450 feet from residential zoned district (Glen Ponds Apartments) •May exceed 40 feet height due to Northwood Parkway Bridge Proposed Eagan Site APC Review –March 22 workshop •Highway billboard may be appropriate •More discussion is warranted •Dynamic signs are a greater driver distraction than static signs •Revenue generated by one billboard may not be significant •Digital billboard expansion conflicts with City’s sustainability goals •Would be helpful to understand changes to community opinions regarding billboards Peer Communities Bloomington –All billboards nonconforming as of August 2009 and new billboards prohibited. Minnetonka –All outdoor advertising displays nonconforming as of March 1991 and new billboards prohibited. Similar incentive program for billboard reduction. Eden Prairie –All billboards prohibited. Summary •Sign Code amended in 1993 and 2007 following moratoria •No litigation or legal challenges regarding off-premise signage •Policy has met stated City goal of reducing off-premise signage •Ordinance amendments may need to allow flexibility for number, height, and size of billboards •Distance from residential districts should be considered for signs exceeding 250 square feet •Ordinance cannot be amended to only one sign on City-owned property Policy Questions 1.Does the City Council support changes to the City Code to allow additional off-premise signage? 2.If so, does the City Council support formation of a task force or commission of a study, similar to what was done in 1993 and 2007, to better understand the implications of changes to the Sign Code? 2/8/22, 1:04 PM Eagan, MN Code of Ordinances about:blank 1/1 Ref #Address (PID #) Location Surfaces SF/ Surface SF Total 1 2750 Sibley Mem. Hwy. (103288501001) I-494 between Hwy. 13 & Pilot Knob Rd. Northwest corner of property 2 624 1,248 2 2750 Sibley Mem. Hwy. (103288501001) I-494 between Hwy. 13 & Pilot Knob Rd. Northeast corner of property 2 672 1,344 3 4151 Sibley Mem. Hwy. (100190001356) Hwy. 13, between Cedar Ave. & Diey Rd. 1 250 250 4 3700 Nicols Road (100180056011) Hwy. 77, north of Hwy. 13 (on railroad) 2 378 756 5 2196 Cedar Ridge Court (101682102001) Hwy. 77, between Diey Rd. and Cli Rd. 2 378 756 6 1181 Trapp Rd. (beyond NE Corner) (102250005108) Soo Line right-of-way, south of I-494 and west of Hwy. 55 (added 9/5/99) 1 {1} 480 {20} 480 {20} 7 1255 Trapp Rd. (1022250014001) I-494, junction of I-35E 2 378 756 8 2750 Eagandale Blvd. (beyond NW Corner) (102250014307) Soo Line right-of-way, Hwy. 55, west of I-35E 2 360 720 CLIFF RD DIFFLEY RD YANKEE DOODLE RD HWY 149LEXINGTON AVEPILOT KNOB RDHWY 77HWY 13I - 35EHWY 5 5 I - 494 PILOT KNOB RDCLIFF RD LONE OAK RD MN Hwy 77Cliff Road (Co. Rd. 32)Lexington Ave (Co Rd 43)Blackhawk Rd.Dodd Rd. Butwin Road Deerwood Dr. Wilderness Run Rd Duckwood Dr.Rahn RoadGalaxie Ave.Elrene RoadNorthview Park Rd. Yankee Doodle Rd. (Co. Rd. 28) Elrene Rd.Johnny Ca k e Rdg Rd.Town Center Dr. T h omas Lake Rd.Slater Rd.Braddock Tr.Federal DrivePilot Knob Road (Co. Rd. 31)C liffL a k e Rd. Cedar G r o v e P k w y .Lon e O a k D r . Silver Bell Rd. Lexington Pt. Pkwy. Northwood Parkway Crestridge Dr.Dodd RoadTowerview Rd.Denmark AveWescott Road Nicols Rd.Cliff Road (Co. Rd. 32) Lone Oak Rd. (Co. Rd. 26) Viking s Pkwy. Red Pine Ln. Diffley Road (Co. Rd. 30) I-494 M N HW Y 5 5 MN HWY 149MN HWY 149MN H W Y 5 5 ! ! !! ! ! ! ! ! ! ! ! !! ! ! ! !! ! ! ! ! ! ! ! !! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! !! ! ! ! ! ! ! ! !! ! ! ! ! ! ! !! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! !! ! ! ! !! ! ! !! !! !! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! !!! ! ! ! ! ! ! ! ! !! !! !! !!!! ! ! ! ! ! ! ! ! ! ! ! ! !! ! ! ! ! ! ! ! ! ! ! ! ! !! ! ! ! ! ! ! ! ! ! !! ! ! ! ! ! ! ! !! ! ! ! ! ! ! ! ! ! ! ! ! ! !! ! ! ! ! ! ! !! ! !!! ! ! ! ! !! ! ! ! ! ! ! ! ! ! ! !! ! ! ! ! ! ! !! ! ! ! !! ! ! ! ! ! !! ! ! ! ! ! ! ! ! ! ! ! !! ! ! ! ! ! ! ! ! ! ! !! !! ! ! !! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! !! ! !! ! ! ! ! ! ! ! ! ! ! ! !! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! !! ! !! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! !! ! !! ! ! !! !! ! ! ! ! ! !! ! ! !! ! ! ! ! ! ! ! ! ! ! ! ! !! !! !! ! ! ! ! ! !!! ! ! ! ! ! ! ! ! ! ! ! ! !!! !! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! !! ! ! ! !! ! !! ! ! !! ! ! !! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! !! ! ! ! ! ! ! ! ! !! ! ! ! ! $+26 $+26 !(28 !(28 !(30 !(30 !(30 $+31 $+31 $+31 $+32 $+32 !(43 !(43§¨¦35E §¨¦35E §¨¦35E §¨¦494 ÕÇ13 ÕÇ13 ÕÇ149 ÕÇ149 ÕÇ149 ÕÇ3 ÕÇ3 ÕÇ55 ÕÇ55 ÕÇ77 11 22 33 44 55 6677 88 City of Eagan Off-Premise Sign (Billboard) Locations Date: 12/22/2021 LEGEND1:48,464 Billboards Agenda Information Memo June 14, 2022 City Council Workshop V. Center for Economic Inclusion Update on Race, Equity and Inclusion Effort Direction For Consideration: Receive presentation from Center for Economic Inclusion with an update on the City’s race, equity, and inclusion effort. Facts: ➢ Saroeun Earm, Inclusive Growth Consultant at the Center for Economic Inclusion (CEI), will lead the CEI team partnering with the City of Eagan. At this meeting she will present the project’s key objectives, strategy, and scope of services. Joining Saroeun will be Tawanna Black, CEI’s CEO and Founder. ➢ The purpose of this presentation is to clarify expectations about the year ahead and how the work will progress. This is an opportunity to ask questions, share requests, express concerns, and build a common understanding of this project. ➢ At the City Council retreat in April 2021, Council directed staff to seek professional services to support the development of a racial equity and inclusion (REI) plan. o The city received nine proposals. Staff interviewed seven applicants and selected three finalists. Based on their RFQ proposal, interviews, and written response to supplemental finalist questions, which demonstrated their relevant experience working with other government agencies, highly qualified staff, deep familiarity with the REI plan process, and understanding of Eagan’s goals, staff proposed the Center for Economic Inclusion (CEI) as the consulting firm of choice. o In March 2022, the Council’s Communication Committee (Paul Bakken and Gary Hansen) met with this proposed finalist for the Race Equity and Inclusion assessment. Tawanna Black, CEI’s CEO and Founder, along with Sarouen Earm, Inclusive Growth Consultant, shared a summary of their proposed approach for the City of Eagan. ➢ The Council approved a contract with CEI at the June 7, 2022 Council Meeting . The project will kick off this summer and conclude by November 30, 2023. Through a collaborative and inclusive process involving city leaders, staff, and community members, Eagan will: o Establish Eagan’s racial equity and inclusion vision ; o Develop focus areas, goals, and performance metrics; o Identify obstacles to achieving goals; o Present recommendations to leadership. Attachments: V-1 Presentation City of Eagan Racial Equity and Inclusion Framework June 14, 2022 Copyright ©2020 Center for Economic Inclusion. All rights reserved. Copyright ©2020 Center for Economic Inclusion. All rights reserved. 2 OUR MISSION The nation’s first organization created exclusively to build regional economies that work for everyone. We build new systems for racial and economic justice and equitable wealth. We equip public-and private-sector leaders with the knowledge and tools to build, scale, and institutionalize anti-racist workplaces in shared accountability with Black, Indigenous, Latino, and Asian workers and business owners to close racial wealth gaps and build racially equitable and inclusive regional economies. 33 | 3 Copyright ©2021 Center for Economic Inclusion. All rights reserved. 1 2 3 4 Create broad, measurable, shared accountability for creating a racially inclusive and equitable regional economy among decisionmakers and policymakers Equip public and private sector employers and policy makers with solutions to disrupt and dismantle systemic racism and institutionalize for scale Partner to enable the regional and place-based infrastructure of opportunity Foster operational excellence and a high-performance culture STRATEGIES Copyright ©2020 Center for Economic Inclusion. All rights reserved. Systems Change for Inclusive Economic Growth + Indicators for an Inclusive Regional Economy Six Conditions of Systems Change INCLUSIVE GROWTH ECONOMIC DEVELOPMENT HUMAN CAPITAL OPPORTUNITY & ACCESS Copyright ©2021 Center for Economic Inclusion. All rights reserved. Tawanna A. Black Founder & CEO Our Team Nathan Arnosti Director, Products & Analytics 5 Collectively, 200+ years of experience delivering racial equity, human resources, change management and diversity, equity and inclusion solutions to businesses. Tim Boudreaux Director, Racial Equity Consulting Saroeun Earm Inclusive Growth Consultant Sarah Milnar McLaughlin Inclusive Growth Consultant Andrea Ferstan Vice President, Innovation, Policy, and Research Tiffany Wilson-Worsley Director, Employer Learning & Engagement Shoreé Ingram Managing Director, Employer Services and Consulting Copyright ©2021 Center for Economic Inclusion. All rights reserved. The Opportunity: Key Objectives The City of Eagan has selected the Center for Economic Inclusion to help identify the contents and facilitate the development of a citywide racial equity and inclusion plan (REI Plan). The Center will facilitate a comprehensive process to develop a Racial Equity Framework in Phase I and develop a path to create a full Racial Equity Plan and build the City's capacity to implement in the plan in Phase II (in a second contract). The plan is intended to reflect the City’s desire to establish a foundation of race equity, inclusion, and belonging across all City services, programs, policies, budgetary decisions, not only throughout the entire City of Eagan organization, but throughout the entire external community of Eagan. Confidential . Copyright ©2021 Center for Economic Inclusion. All rights reserved. 7 Stages Duration Organizational Assessment or Landscape Analysis (Learning & Discovery)June –Aug. 2022 Develop strategies, goals and baseline indicators Sept.–April 2023 Assess and share Racial Equity and Inclusion Framework. Submit final product to leadership.May –July 2023 Confidential Scope of Services 8 A Platform for Scale & Growth in Phase 2 The Center will: §Launch and implement the REI Framework utilizing tools for capacity building, evaluation, on-going engagement, and sustainability §Develop tools for training and change management in partnership with REI committee and staff input sessions (e.g., fact sheets, blogs, FAQs, guides for managers). §Work with Eagan staff and Racial Equity and Inclusion Committee to identify training, implementation, and change management needs. Copyright ©2020 Center for Economic Inclusion. All rights reserved. Copyright ©2020 Center for Economic Inclusion. All rights reserved. Acting in Solidarity CO-CREATION of anti-racist talent, procurement, investment and policy strategies SHARE & TRANSFER POWER with Black, Indigenous, Asian and Latinx communities to achieve income & wealth equity ESTABLISH GOALS and invest responsively; apply adaptive learning for sustained impact + ++ + Our Commitment to Foster Shared Accountability EQUIP employers & policy makers with tools, promising practices and consulting support for results CONNECT sectors, employers, Black, Indigenous, Latinx and Asian communities and leaders to cultivate an inclusive and equitable civic infrastructure ACTIVATE NARRATIVE CHANGE campaigns and efforts to elevate and advocate for the proven economic impact of an inclusive and equitable economy Copyright ©2020 Center for Economic Inclusion. All rights reserved. Thank you for this opportunity! Copyright ©2020 Center for Economic Inclusion. All rights reserved. City of Eagan Racial Equity and Inclusion Framework June 14, 2022 Copyright ©2020 Center for Economic Inclusion. All rights reserved. Copyright ©2020 Center for Economic Inclusion. All rights reserved. 2 OUR MISSION The nation’s first organization created exclusively to build regional economies that work for everyone. We build new systems for racial and economic justice and equitable wealth. We equip public -and private-sector leaders with the knowledge and tools to build, scale, and institutionalize anti-racist workplaces in shared accountability with Black, Indigenous, Latino, and Asian workers and business owners to close racial wealth gaps and build racially equitable and inclusive regional economies. 33 | 3 Copyright ©2021 Center for Economic Inclusion. All rights reserved. 1 2 3 4 Create broad, measurable, shared accountability for creating a racially inclusive and equitable regional economy among decisionmakers and policymakers Equip public and private sector employers and policy makers with solutions to disrupt and dismantle systemic racism and institutionalize for scale Partner to enable the regional and place -based infrastructure of opportunity Foster operational excellence and a high-performance culture STRATEGIES Copyright ©2020 Center for Economic Inclusion. All rights reserved. Systems Change for Inclusive Economic Growth + Indicators for an Inclusive Regional Economy Six Conditions of Systems Change INCLUSIVE GROWTH ECONOMIC DEVELOPMENT HUMAN CAPITAL OPPORTUNITY & ACCESS Copyright ©2021 Center for Economic Inclusion. All rights reserved. Tawanna A. Black Founder & CEO Our Team Nathan Arnosti Director, Products & Analytics 5 Collectively, 200+ years of experience delivering racial equity, human resources, change management and diversity, equity and inclusion solutions to businesses. Tim Boudreaux Director, Racial Equity Consulting Saroeun Earm Inclusive Growth Consultant Sarah Milnar McLaughlin Inclusive Growth Consultant Andrea Ferstan Vice President, Innovation, Policy, and Research Tiffany Wilson-Worsley Director, Employer Learning & Engagement Shoreé Ingram Managing Director, Employer Services and Consulting Copyright ©2021 Center for Economic Inclusion. All rights reserved. The Opportunity: Key Objectives The City of Eagan has selected the Center for Economic Inclusion to help identify the contents and facilitate the development of a citywide racial equity and inclusion plan (REI Plan). The Center will facilitate a comprehensive process to develop a Racial Equity Framework in Phase I and develop a path to create a full Racial Equity Plan and build the City's capacity to implement in the plan in Phase II (in a second contract). The plan is intended to reflect the City’s desire to establish a foundation of race equity, inclusion, and belonging across all City services, programs, policies, budgetary decisions, not only throughout the entire City of Eagan organization, but throughout the entire external community of Eagan. . Copyright ©2021 Center for Economic Inclusion. All rights reserved. 7 Stages Duration Organizational Assessment or Landscape Analysis (Learning & Discovery)June –Aug. 2022 Develop strategies, goals and baseline indicators Sept.–April 2023 Assess and share Racial Equity and Inclusion Framework. Submit final product to leadership.May –July 2023 Scope of Services 8 A Platform for Scale & Growth in Phase 2 The Center will: ▪Launch and implement the REI Framework utilizing tools for capacity building, evaluation, on -going engagement, and sustainability ▪Develop tools for training and change management in partnership with REI committee and staff input sessions (e.g., fact sheets, blogs, FAQs, guides for managers). ▪Work with Eagan staff and Racial Equity and Inclusion Committee to identify training, implementation, and change management needs. Copyright ©2020 Center for Economic Inclusion. All rights reserved. Copyright ©2020 Center for Economic Inclusion. All rights reserved. Acting in Solidarity CO-CREATION of anti-racist talent, procurement, investment and policy strategies SHARE & TRANSFER POWER with Black, Indigenous, Asian and Latinx communities to achieve income & wealth equity ESTABLISH GOALS and invest responsively; apply adaptive learning for sustained impact + ++ + Our Commitment to Foster Shared Accountability EQUIP employers & policy makers with tools, promising practices and consulting support for results CONNECT sectors, employers, Black, Indigenous, Latinx and Asian communities and leaders to cultivate an inclusive and equitable civic infrastructure ACTIVATE NARRATIVE CHANGE campaigns and efforts to elevate and advocate for the proven economic impact of an inclusive and equitable economy Copyright ©2020 Center for Economic Inclusion. All rights reserved. Thank you for this opportunity! Copyright ©2020 Center for Economic Inclusion. All rights reserved.         Agenda Information Memo  June 14, 2022 Special City Council Workshop        VI. Rental Licensing     Direction for Consideration:    Provide direction to staff regarding the rental licensing program.          Background   The City of Eagan currently has approximately 8,730 registered rental units which is 29  percent of the City’s housing stock.   Rental housing includes 6,617 rental apartments, 716 rental townhomes, and 1,426  single unit rentals.  Single unit rentals are units which were constructed as ownership  units but are currently rented.     At work session meetings on November 9, 2021, and March 8, 2022, the City Council  discussed a potential rental licensing program and directed staff to proceed with  developing a program.       Since the March 2022 work session meeting, staff has: o Implemented Phase I and II of the Communications and Engagement Plan; o Drafted job descriptions for new and adjusted staff positions; o Identified estimated revenue and expenses to create a program budget; o Worked with the City Attorney on a draft rental licensing ordinance and  incorporation of the International Property Maintenance Code; and o Evaluated options for rental licensing and permitting software.    Communications and Engagement Plan     The City has implemented Phase I (Discovery and Socialization) and Phase II  (Engagement) of the Communications and Engagement Plan.    Phase I included an article in Experience Eagan and information posted on social media  and the City website.     Phase II included a survey targeting Eagan homeowners, landlords and renters.  The  survey link was distributed through social media, the City website, and via email to  owners of registered rentals.  The survey received 462 responses.  Respondents  included 233 homeowners (50%), 155 landlords (34%), and 74 renters (16%).  Of the  landlords who responded, 61% were not Eagan residents which is fairly consistent with  the City’s overall percentage of non‐Eagan single‐unit owners (70%).  Survey results  showed strong support for a rental licensing program.             Homeowners Landlords Renters Total  Support/Strongly Support 70% 34% 84% 60%  Do Not Support 12% 37% 7% 19%  No Opinion/Not Sure/Left Blank 18% 29% 9% 21%    “Safety in every home” was a priority for 60% of survey respondents, and “ensuring we  continue to have well‐maintained housing” was a priority for 69% of survey  respondents.     A facilitated conversation with rental licensing stakeholders was held on May 16, 2022.   Invitations were sent to selected survey respondents with a goal of equal balance  among landlords, homeowners (who did not own rental property), and renters.   Representatives from the Dakota County CDA, Minnesota Multi Housing Association,  and HOME Line (a tenant advocacy organization) also attended.  Statements by  attendees included:  o Benefits of a rental licensing program include housing safety, increased equity  for tenants, better data collection on rental housing, clear maintenance  standards, and level playing field between landlords.  o Challenges of a rental licensing program include increased costs which are  passed on to renters, higher fees for single‐unit landlords (due to less efficient  inspections than multifamily buildings), cost of additional repairs for landlords,  and increased costs to good landlords.  o Attendees had significant discussion regarding who pays the costs of a rental  licensing program.  Some cities set fees to fully recover program costs.  Other  cities see a community benefit in rental licensing and support some program  costs through general municipal revenue.  Several attendees strongly supported  a cost share between the industry (via licensing fees) and the community (via  levy).    o Although several renters were invited to attend the facilitated conversation, only  one renter participated in the event.  The renter shared experiences with  different landlords – some of whom responded promptly to repair requests and  some of whom allowed problems to remain unfixed.  Staff acknowledges that  further, targeted engagement with renters is warranted.        Expenses, Revenue, and Fees     Rental licensing program expenses include 2.5 FTE for two inspectors and one‐half  clerical position.  (Note: Community Development did not fill a 0.5 clerical position that  became vacant during the pandemic.)  This staffing level is consistent with staffing levels  in other cities with rental licensing programs, prorated to number of rental units.   Expenses also include grade adjustments for existing staff who would accept additional  responsibilities.    Additional rental licensing expenses include two additional vehicles,  computers/equipment, credit card fees for online fee payments, annual software  licensing, and staff training.         Of the eleven comparable rental licensing cities surveyed, some reported that their fees  fully covered program costs.  Others reported that fees did not fully support program  costs because the City Council was reluctant to raise fees to landlords or their program  provided licensing fee reductions for meeting certain City objectives.   Staff have created two revenue models:  A “User Fee Cash Flow” model and a  “Community Benefit” model.  The User Fee Cash Flow model assumes that all rental  licensing program costs will be supported through user (licensing) fees.  The Community  Benefit model assumes that some program costs would be supported through the levy.   In both revenue models, capital startup costs for software and two vehicles are  excluded from the model and are not supported with licensing fees.  Capital startup  costs may be eligible for ARPA funding.   Both revenue models assume that program start‐up will take approximately two years.   During program startup, fees will not fully cover costs due to initial expenses (i.e.,  equipment, certifications, mailed notices to rental registrants) and non‐compliance with  licensing.  Program stabilization (licenses issued to 95% of existing registered rentals) is  projected to occur in Year 3.  Operational startup costs may be eligible for ARPA  funding.     The User Fee Cash Flow model sets per unit/building licensing fees slightly higher than  licensing fees in Burnsville and Edina, and program revenue is expected to fully support  program costs by Year 3.  The User Fee Cash Flow model sets fees at the higher range  (but not the highest) of the eleven comparable communities surveyed.   The Community Benefit model sets fees very similar to Bloomington which  acknowledges that fees do not fully cover program costs.  In Year 3 and beyond, the  Community Benefit model requires an approximately $135,000 annual levy  contribution.  The Community Benefit model sets fees around mid‐range of the  comparable communities surveyed.   The difference in fees between the two models is approximately $75 annually for a  single unit rental and $50 per building/$8 per unit annually for multifamily buildings.   As a policy question, the City Council will be asked to provide direction on whether the  User Fee Cash Flow or Community Benefit model is preferred.   Licensing and Permitting Software     The City currently uses PIMS software through LOGIS for permitting, code enforcement,  and licensing.  Over the past few years, it has become increasingly apparent that PIMS  does not offer the efficiency and transparency that are provided by other software  options and have come to be expected by users (residents, businesses, contractors).     City staff have begun researching options for permitting and licensing software.   Because permitting is a larger and more complex program than code enforcement and  licensing, permitting software should be chosen before moving forward with rental  licensing.       Desired features in a new permitting and licensing software include integrated systems  to avoid duplicative data entry, automated status update correspondence to users,  online scheduling, field data entry, and built‐in mapping.          Timeline for Implementation    The initial rental licensing implementation schedule assumed a tentative  implementation of January 1, 2023.  Staff recommends postponing implementation until  at least the third quarter of 2023 to address software research, renter outreach, and  planning for an orderly implementation.     An updated implementation schedule will be provided to the City Council in Fall 2022  with a draft rental licensing ordinance.      Policy Questions  1) Does the City Council support a fee model that:  a) Fully covers program costs through user fees, or    b) Partially covers program costs through user fees with some costs supported by the City  levy?    2) Does the City Council support scheduling implementation for no earlier than the third  quarter of 2023 to allow time for software decisions, renter outreach, and implementation  coordination?    Attachments (1):   Presentation      Rental Licensing City Council Work Session June 14, 2022 Rental Licensing November 9, 2021 •Background information on Eagan rental housing •Research of comparable communities •Basic structure of rental licensing programs March 8, 2022 •Communications and Engagement Plan •Ordinance provisions June 14, 2022 •Feedback from community outreach •Revenue models Communications & Engagement Plan Phase I –Discovery and Socialization •Experience Eagan article •Social media •City website Phase II –Engagement •Stakeholder survey •Facilitated conversation Survey Results 462 responses Safety and maintenance are strong housing priorities Homeowners 50% Landlords 34% Renters 16% Survey Responses Survey Results Overall support/strongly support = 60% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% Homeowners Landlords Renters Total Support for Rental License Program Support/Strongly Support Do Not Support No Opinion/Not Sure/Left Blank Facilitated Conversation Community benefits •Housing safety •Tenant equity •Maintenance standards •Housing data collection Landlord costs passed to tenants •Higher costs for single-unit landlords •Low operating margins •Scheduling challenges •Good vs “problem” landlords Who pays the cost: industry or community? Facilitated Conversation Renters •Some landlords respond promptly, some don’t •Tenant recourse is lawsuit •200 maintenance calls to HOME Line since 2018 •Additional tenant engagement Communications & Engagement Plan Phase 3 –Education and Impact •Late summer/fall 2022 •Impact and key aspects of rental licensing •Findings and feedback from engagement efforts •Success stories of public safety, equity, and housing maintenance Phase 4 –Implementation, requirements, and compliance •2023 •Requirements for landlords •Application and inspection process Expenses Annual Expenses •2.5 FTE •Vehicles –fuel and maintenance •Credit card fees •Annual software licensing •Supplies, training Startup capital costs •Vehicles (2) •Software •Excluded from revenue models •May be ARPA eligible Revenue Models Cash Flow Model •High fee range •Estimated $140,000 startup gap (may be ARPA eligible) •Program fully supported by fees in Year 3 Community Benefit Model •Mid-range fees •Estimated $300,000 startup gap (may be ARPA eligible) •Program has $135,000 gap in Year 3 (likely requiring a levy contribution) Fee Difference •$75 annually for single-unit license •$50/building and $8/unit annual for multifamily license Licensing & Permitting Software Licensing is module of permitting software Current permitting software –PIMS through LOGIS Improved functionality •Integrated, intuitive systems •Automated correspondence •User transparency •Online scheduling •Field data entry •Built-in mapping Next Steps Summer/Fall 2022 •Renter engagement •Phase III –Communications and Engagement Plan •Software research •Ordinance review City Council Workshop –Fall 2022 •Engagement feedback •Draft rental licensing ordinance •Implementation plan and schedule Policy Questions 1.Does the City Council support a fee model that: a)Fully covers program costs through licensing fees, or b)Partially covers program costs through licensing fees with some costs supported by the levy? 2.Does the City Council support scheduling implementation for no earlier than the third quarter of 2023 to allow time for software decision, renter outreach, and implementation coordination?