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Community Development Authority Packet - 7/21/2015 CITY OF MUSKEGO COMMUNITY DEVELOPMENT AUTHORITY AGENDA July 21, 2015 7:30 AM City Hall, W182 S8200 Racine Avenue CALL TO ORDER PLEDGE OF ALLEGIANCE ROLL CALL STATEMENT OF PUBLIC NOTICE APPROVAL OF THE MINUTES OF MAY 19, 2015 PUBLIC INPUT NEW BUSINESS 1. TID 8 Grant Request: Muskego Beer & Liquor (S75 W17308 Janesville Road) 2. Business Recruitment Rewards Program Grant 3. Discussion on future of Incentive Programs offered by the City of Muskego ONGOING BUSINESS 1. Tess Corners Redevelopment District (#1) Implementation 2. Downtown Redevelopment District (#2) Implementation 3. Muskego Business Park Redevelopment District (#3) Implementation 4. Mill Valley Redevelopment District (#4) Implementation 5. Marketing Plan Implementation MISCELLANEOUS BUSINESS AS AUTHORIZED BY LAW 1. Redevelopment District Developments Disc. & Other Miscellaneous Information Updates 2. Next Meeting Date ADJOURNMENT NOTICE IT IS POSSIBLE THAT MEMBERS OF AND POSSIBLY A QUORUM OF MEMBERS OF OTHER GOVERNMENTAL BODIES OF THE MUNICIPALITY MAY BE IN ATTENDANCE AT THE ABOVE-STATED MEETING TO GATHER INFORMATION; NO ACTION WILL BE TAKEN BY ANY GOVERNMENTAL BODY AT THE ABOVE-STATED MEETING OTHER THAN THE GOVERNMENTAL BODY SPECIFICALLY REFERRED TO ABOVE IN THIS NOTICE. ALSO, UPON REASONABLE NOTICE, EFFORTS WILL BE MADE TO ACCOMMODATE THE NEEDS OF DISABLED INDIVIDUALS THROUGH APPROPRIATE AIDS AND SERVICES. FOR ADDITIONAL INFORMATION OR TO REQUEST THIS SERVICE, CONTACT MUSKEGO COMMUNITY DEVELOPMENT DEPARTMENT, (262) 679-4136. Unapproved CITY OF MUSKEGO COMMUNITY DEVELOPMENT AUTHORITY MINUTES May 19, 2015 6:00 PM Aldermen’s Room – Upper Level of City Hall, W182 S8200 Racine Avenue CALL TO ORDER Chairman Bob LeClaire called the meeting to order at 6:00 PM. PLEDGE OF ALLEGIANCE Those present recited the Pledge of Allegiance. ROLL CALL Present: Bob LeClaire, Barb Schroeder, Dave Stevens, Lana Arrowood, Ald. Kubacki, Ald. Kapusta and Director Jeff Muenkel. Absent: Bonnie Johnson STATEMENT OF PUBLIC NOTICE This meeting was noticed in accordance with the open meeting laws. APPROVAL OF THE MINUTES OF MARCH 17, 2015. INTRODUCTION OF NEW CDA MEMBERS ELECTION OF CHAIR, VICE-CHAIR, AND SECRETARY Ald. Kubacki nominated Bob LeClaire for Chairman. Upon a voice vote, the nomination was approved. Bob LeClaire nominated Lana Arrowood for Vice Chairman. Upon a voice vote, the nomination was approved. Bob LeClaire nominated Dave Stevens for Secretary. Upon a voice vote, the nomination was approved. PUBLIC INPUT NEW BUSINESS Commercial Grant Request: Marx Pioneer Inn (180 S7808 Pioneer Drive) Ald. Kubacki made a motion to approve a Commercial Grant Request for Marx Pioneer Inn (180 S7808 Pioneer Drive) in the amount of $4,300. Lana Arrowood seconded. Motion Passed 7 in favor. Commercial Grant Request: Max A. Sass & Sons Funeral Home (W173 S7629 Westwood Drive) Ald. Kubacki made a motion to approve a Commercial Grant Request for Max A. Sass & Sons Funeral Home (W173 S7629 Westwood Drive) in the amount of $4,884 to cover 50% of the landscaping costs of $9,768. Barb Schroeder seconded. Motion Passed 7 in favor. TID 8 Grant Request: Muskego Mobil (S73 W16680 Janesville Road) Ald. Kubacki made a motion to approve a TID 8 Grant Request for Muskego Mobil (S73 W16680 Janesville Road) in the amount of $13,700. Dave Stevens seconded. Motion Passed 7 in favor. TID 8 Grant Request: DeWinter Eye Care (SW Corner Janesville Road/Bay Lane Drive) Barb Schroeder made a motion to approve a TID 8 Grant Request for DeWinter Eye Care (SW Corner Janesville Road/Bay Lane Drive) in the amount of $75,000. Ald. Kapusta seconded. Motion Passed 7 in favor. Revolving Loan Fund Request: Alpha Plastics (S82 W19362 Apollo Drive) Ald. Kubacki made a motion to approve a Revolving Loan Fund Request for Alpha Plastics (S82 W19362 Apollo Drive) in the amount of $200,000 subject to the contingencies of SEWRPC. Lana Arrowood seconded. Motion Passed 7 in favor. ONGOING BUSINESS Tess Corners Redevelopment District (#1) Implementation Downtown Redevelopment District (#2) Implementation Muskego Business Park Redevelopment District (#3) Implementation Mill Valley Redevelopment District (#4) Implementation Marketing Plan Implementation MISCELLANEOUS BUSINESS AS AUTHORIZED BY LAW Redevelopment District Developments Disc. & Other Miscellaneous Information Updates Next Meeting Date ADJOURNMENT Lana Arrowood made a motion to adjourn at 7:16 PM. Ald. Kapusta seconded. Motion Passed 7 in favor. Respectfully submitted, Kellie McMullen, Recording Secretary NEW BUSINESS ITEM #1: TID 8 Grant Request: Muskego Beer & Liquor (S75 W17308 Janesville Road) STAFF DISCUSSION Enclosed, please find an application for a grant within the confines of the city’s tax increment district (TID) #8. The applicant is Clark Fischer for Muskego Beer & Liquor which is located at S75 W17308 Janesville Road. Mr. Fischer requests a grant of $25,000 for their approximate $195,800 worth of improvements. The improvements consist of the following below. A full submittal and description can be found in the supplement attached.  New Improvements: Upgrade and replace all materials on front façade with new shake cedar roofing on the second floor mansard, new cedar boards covering the former A/C areas on the second floor, fiber cement siding on the first floor, addition of new Lannon stone along the base front of the structure, increased wrapping of new stone on the front corners, and a more attractive entryway with timbers and stone columns. NOTE: The new cedar mansard roof will be upgrad ed around the whole structure. The sides of the structure are intended to be painted an earth tone matching the new materials on the front of the structure.  Improvements Completed to Date: Parking lot upgrade and resurface, new monument sign with electronic reader board, and paver brick base for monument sign that matches city pavers along Janesville Road. As the CDA may know we have treated properties within the TID 8 in the downtown a bit differently when it comes to grant and loan requests. The city amended the TIF 8 back in 2012 to include more properties along Janesville Road to the west of Lannon and to the east of the library. The TID amendment was specific that the city had over $375,000 of leftover TID monies that we wanted to use for redevelopment projects that would spur new tax base and that could be used for grants/loans similar to our Commercial Building and Site Grant/Loan Programs. Since this site is within the TID 8 boundary we can use the TID 8 monies for any grants requested rather than the usual funds used for other grants/loans that we’ve given for properties outside the TID 8. However, we usually want to apply the same principles that the adopted Commercial Building & Site Program implores. Thus, the Commercial Building & Site Grant Program offers grants to petitioners that meet the following criteria below: The purpose of the Commercial Building & Site Grant Program is to provide matching grants to existing commercial buildings and sites for preservation and restoration. Further, the program is instituted to encourage urban design excellence, integrate urban design and preservation of Muskego’s heritage into the process of downtown redevelopment, and enhance the character of the downtown area. Grant resources should produce visible changes to commercial buildings and commercial sites. Since funding sources are limited, priority will be given to projects demonstrating the most substantial impact on building and neighborhood aesthetics. As noted above, Mr. Fischer has completed many other improvements on the property in the recent year. The breakdown aesthetic related improvements can be found in the attached supplement. The cost breakdown shows that $60,000 was spent on the parking lot and signage to date and that another $195,800 is intended to be spent on the other exterior improvements to the building as part of this grant request. The TID 8 currently has a balance of approximately $276,000 that can go for grants related to the betterment of the district. Recently the city used some of these TID 8 monies for incentives for Niko’s Café ($75,000 loan/$7,500 grant), John Jewell building ($100,000 loan/$22,500 grant), the Westwood Centre ($100,000 loan/$15,000 grant), DeW inter Eye Care Center ($75,000), and Muskego Mobil ($13,700). In all, staff believes that the level of improvements is substantial and meets the expectations of a grant for the aesthetic improvement of the properties on Janesville Road. Structural façade improvements are of course more able to produce tax base than landscape or site improvements which is a plus. Staff recommends approval of this TID 8 grant as the monies were set aside specifically for these tax base producing purposes back when the TID 8 was amended to include this property in 2012. Further, staff doesn’t see many, if any, more redevelopment property grants in the TID 8 as the majority of the businesses we approached about using this TID 8 money back in 2012 have now come to fruition. Completing this project with Muskego Liquor will complete a whole city block of improvements along Janesville Road which was a goal of the CDA and the Redevelopment Plan. A $25,000 grant would represent an approximate 11:1 ratio of developer to city dollars ($270,000:$25,000). NEW BUSINESS ITEM #2: Business Recruitment Rewards Program Grant STAFF DISCUSSION Enclosed, please find our first official application for the Business Recruitment Rewards Program. While staff has had applicants to this program since its adoption in 2013, this is the first app lication that was applied for and ultimately resulted in the business opening in Muskego. The applicant is Matthew Quest who is a broker and owner of Capital Commercial. Mr. Quest submitted the application back in on November 13, 2013 advocating that he is pursuing the company Spectrum Resources for the City of Muskego. After about a year of work between the City of Muskego and Mr. Quest we were able to get approvals for Spectrum Resources to build a new 60,000 square foot structure in the Moorland Commerce Center West. Spectrum ended up moving to Muskego with 21 employees after taking occupancy of their 29,000 square feet in early July. Spectrum also built the new structure with two tenant spaces that resulted in two other companies coming to Muskego from New Berlin. Global Fastener and Supply (18 employees) is utilizing 25,000 square feet and Elive (7 employees) is utilizing another 6,000 square feet. As CDA may be aware, the Business Recruitment Rewards Program was adopted by the CDA and Council back in 2013. The program was setup to hopefully encourage brokers and even residents to try and advocate to make businesses to come and thrive in Muskego. The program was recommended by the City’s Marketing Plan. Here is some of the criteria from the adopted program: Guidelines Muskego believes that not all business leads materialize from City Hall. Many business discussions take place in backyards, family events, and everywhere in day to day life that may lead to dialogues about “why not Muskego?” Seeing this, the Business Recruitment Rewards program provides an opportunity to become actively engaged in Muskego’s economic growth and development. The city sets forth this Business Recruitment Program to motivate the everyday citizen to recommend Muskego for that next location of an entrepreneur’s business. In doing so, compensation as outlined below may be approved for the individual that brings that new business, along with new employees, to the Muskego community. Nomination Process Participants who wish to nominate businesses for possible recruitment should submit information on the designated application form attached. Prospective nominations should be made to the City’s Community Development Department as early as possible so that appropriate contacts can be made to verify if the companies meet criteria of the Rewards program. Rewards and Criteria The City believes compensation must be sufficient to act as an incentive for citizens to recommend prospective businesses. The Rewards therefore will be granted as follows:  $2,000 for a business prospect that employs three (3) to fifty (50) employees, or invests $350,000 -$700,000 in capital equipment or real and personal property.  $4,000 for a business prospect that employs fifty-one (51)+ employees, or invests $750,000+ in capital equipment and real or personal property ***Bonus of $1,000 for bringing a business that owns and builds a new structure in the community. NOTE: Final reward amounts and variations on award amounts may need clarification based on the merits on how a business meets the above criteria. Final awards determinations are strictly under the recommendation of the Community Development Authority with approval of the Common Council. Qualified Employment Criteria Employment levels will be based on the equivalency of full-time employees who work an average of forty (40) hours per week on a year-round basis. Seasonal employees will not count towards the employment criteria of the rewards program. The calculation of part-time employees for program purposes will be based on the number of hours they work each week, and whether or not two or more such employees equal the work of one full -time person. For example, two part-time employees who work year-round and who each put in twenty (20) hours of work per week will be counted as one full-time employee. Three part-time employees, each employed ten (10) hours of work per week, will not be considered as the equivalent of a full-time employee. Given the criteria of the adopted program Spectrum has brought 21 employees to the Muskego area and thus qualifies Mr. Quest for $2,000. Another $1,000 bonus is granted since Spectrum does own the new structure. Approval is recommended for a $3,000 grant since the guidelines of the adopted program are fully met. This relationship between the City of Muskego and Mr. Quest truly made Spectrum a reality for Muskego and the end result was more than hoped for with Spectrum investing in a larger structure and bringing in two other b usinesses to the city. NEW BUSINESS ITEM #3: Discussion on future of Incentive Programs offered by the City of Muskego STAFF DISCUSSION About a year ago the CDA agreed to have a discussion on evaluating the importance of the various grant and loan programs we currently have adopted in the City of Muskego. From this conversation a recommendation may come from the CDA to the Council on how we may want to proceed with the programs. The CDA discussed last year that we are embarking on almost two years from the completion of the construction of Janesville Road in the summer of 2015. Since the Commercial Grant & Loan Programs were originally adopted to promote aesthetic improvements to businesses along Janesville Road, in order to complement the improvem ents the city paid for, should the programs continue? Staff attached the rundown of the grants and loans we have approved over the past five years. As the CDA will find we have been very successful and should be proud. Staff did send out letters to all the businesses earlier this year letting them know that the programs may come to completion this summer and we did see a pretty good push for grants and loans recently. In all, staff believes that having grant and loan programs sets Muskego a part from other communities and shows that we want to be an investment partner of our businesses and want to retain and see them grow. Thus, staff would recommend continuation of the programs and that the CDA may simply re -look at each program over the next half year and determine if we want to tweak the programs for other specific purposes or specific geographic focus areas instead. ONGOING BUSINESS ITEM #1: Tess Corners Redevelopment District (#1) Implementation STAFF DISCUSSION -Business breakfast meeting update -Staff real estate sign idea and discussion. ONGOING BUSINESS ITEM #2: Downtown Redevelopment District (#2) Implementation STAFF DISCUSSION -Staff attended first Main Street/Connect Community meeting yesterday in Madison from the Wisconsin Economic Development Corporation. We will discuss briefly about what this membership may offer the city. ONGOING BUSINESS ITEM #3: Muskego Business Park Redevelopment District (#3) Implementation STAFF DISCUSSION -Still following up on business retention surveys -What’s next after breakfast meeting? ONGOING BUSINESS ITEM #4: Mill Valley Redevelopment District (#4) Implementation STAFF DISCUSSION No movement is taking place with the quarry in New Berlin, thus there are no updates at this time from Muske go’s side. ONGOING BUSINESS ITEM #5: Marketing Plan Implementation STAFF DISCUSSION -Mayor and Jeff have met with a couple businesses interested in our Moorland corridor and we continue to leverage our TIF there per the Marketing Plan. -Marketing Plan discusses continuation of marketing for a hotel in the community. Some strides have been made in this area that we will discuss. Ongoing: Many discussions with new businesses looking to make Muskego a home. Some within a TIF District and others simply looking for downtown space. Could have a Council discussion on incentives for one particular new business soon. MISC. BUSINESS ITEM #1: Redevelopment District Development & Other Miscellaneous Information Updates -Former Parkland Mall MISC. BUSINESS ITEM #2: Next Meeting Date Tuesday September 15th at 6 pm (or 7:30 am?) unless an earlier date is needed for any grant/loan requests OR TIF District recommendations to the Council. Approximate CDA Budgets 2011 Budget Existing Supplies and Expenses $500 Professional Services $3000 Attorney $5000 Property Sale Balance $91,000 Existing RLF Fund Balance: ~$438,000 (Alpha Plastics $200,000 loan still pending closing) Existing RD #3 Balance: $52,248.03 TIF Residual Balance: ~$634,000 TIF 8 Balance: ~$276,000 Possible after today $248,000 (Muskego Liquor grant)