The URL can be used to link to this page

Home My WebLink About5.F.5. Rahr Corporation - Return of 55 Sewer Availability Charge Credits 111111111 Consent Business 5. F. 5. SHAKOPEE TO: Mayor and City Council FROM: Samantha DiMaggio, Economic Development Coordinator DATE: 06/16/2015 SUBJECT: Rahr Corporation -- Return of 55 Sewer Availability Charge Credits (D) Action Sought The Council is asked to authorize the return of up to 55 SAC credits valued at $26,125 in City of Shakopee credits and $136,675 in Metropolitan Council Sewer Availability Charge (SAC) credits to Rahr Corporation. Background In September, 2008, the City received 1,494 SAC credits as a result of Rahr Malting coming off of the regional wastewater treatment system. The City is now being asked to return some of these credits to Rahr for use in their expansion/ redevelopment. As SAC credits have been used—both for economic development and through regular consumption--the resulting dollars have been placed into the sanitary sewer enterprise fund. The finance director and other city staff are monitoring the use and balances of these credits as they are utilized. At some point in the future, a transfer from the sanitary sewer fund (where the funds for the credits are maintained) to the EDA fund (which may provide the funding for requested subsidies) will need to take place. Rahr is in the process of a substantial expansion/redevelopment project in and around its current Shakopee campus and is requesting SAC credits be awarded to help facilitate this project which includes the construction of: 1) a 112,000 square foot manufacturing, assembly, and processing plant, (the "Malt House") off of 3rd St: •25 SAC Units are required; 2) a 90,000 square foot warehouse located on the north side of County Rd. 69 to serve their Brewer's Supply Group (BSG): • 14 SAC Units are required; 3) a 14,500 square foot maintenance warehouse off of 2nd St: •2 SAC Units are required; 4) an 18,400 square foot research laboratory (the "Tech Center") at the southwest corner of 1st Ave. & Apgar St: • SAC units are yet to be determined for this portion of the project but staff recommends awarding up to 14 additional credits for this facility. This project will bring redevelopment to the north side of 1st Ave., resulting in an increased tax base and more attractive corridor. Rahr is also planning to add more staff to correspond with the expansion/redevelopment. Recommendation The EDAC reviewed this request at their June 10 meeting and has recommended that up to 55 credits be returned to Rahr Corporation. Budget Impact None as the SAC credits were obtained from the Met Council once Rahr Malting came off the Metropolitan Council sewer system. The City Sewer Fund maintains the balance, as a stand alone fund. Relationship to Vision This supports Goal D: Maintain, improve and create strong partnerships with other public and private sector entities. Requested Action If the Council concurs, it should authorize the return of up to 55 SAC credits to Rahr Corporation. Attachments: Application SliAK PEE Sewer Availability Charge (SAC) Credit Application APPLICANT INFORMATION Business(Potential Business) Name: Rahr Corporation Address: 800 West 1st Ave., Shakopee, MN 55379 Property Identification Number(s):(see attachment#1) Name and Contact Information for Authorized Representative Name: Jesse L. Theis Address: 800 West 1st Ave., Shakopee, MN 55379 City: Shakopee State: MN Zip Code: 55379 Telephone: 952-496-7081 Email: jtheis@rahr.com Name and Contact Information for Property Owner Name: Jesse L. Theis Address: 800 West tat Ave. City: Shakopee State: MN Zip Code: 55379 Telephone: 952-496-7061 Email: jtheis@rahr.com DESCRIPTION OF BUSINESS Please include type of business and description of product or services provided. Malt production and manufacturing, brewing products warehousing and distribution, technical brewing support and analysis. Number of credits requested: (see attachment#2) Number of jobs to be created: 28 Number of jobs to be retained: 154 PROPERTY INFORMATION Is the building currently vacant? E✓ Yes No If yes,how many years has the building been vacant: Varies per building COMMUNITY PRIDE SINCE 1857 129 Holmes Street South •Shakopee,Minnesota•55379-1351 • 952-233-9300 •FAX 952-233-3801 •www.ShakopeeMN.gov PROJECT INFORMATION Description of improvements and any anticipated"change of use"that the proposed project will result in: (see attachment#3) Narrative explaining nature of project: (see attachment#4) ESTIMATED PROJECT TIMETABLE Task Estimated Completion Date Start of Construction 4-2015 Complete Construction ! 12-2015 - 4-2017 Begin Operations 1 12-2015 - 4-2017 f horized business contact(print name): Jesse L. Theis 9,4,,,„., . .1 '" + `- -�-•+''` 3•.24-2015 Sie azure ' Date Property owner(if different from the business) (print name): 3-24-2015 COMMUNITY PRIDE SINCE 1857 129 Holmes Street South•Shakopee,Minnesota•55379-1351 •952-233-9300•FAX 952-233-3801 •www.ShakopeeMN.gov DATA PRACTICES ACT The information that you supply in your application to the City of Shakopee;Shakopee EDA("City")will be used to assess your eligibility for financial assistance. The City will not be able to process your application without this information. The Minnesota Government Data Practices Act(Minnesota Statutes,Chapter 13)governs whether the information that you are providing to the City is public or private. if financial assistance is provided for the project,the information submitted in connection with your application will become public,except for those items protected under Minnesota Statutes,Section 13.59,Subdivision 3(b)or Section 13.591,Subdivision 2. I have read the above statement and I agree to supply the information to the City with full knowledge of the matters contained in this notice. I certify that the information submitted in connection with the application is true and accurate. J in /'`' *-� l o() 3-24-2015 S" ature I Title Date FOR CITY OF SHAKOPEE USE ONLY Determination Letter from METC attached: ❑ Yes ❑ No Reviewed by FINANCE: Reviewed by ECONOMIC DEVELOPMENT: Approved By: Date: of SAC Units Awarded: December 2014 COMMUNITY PRIDE SINCE 1857 129 Holmes Street South •Shakopee,Minnesota•55379-1351 •952-233-9300 •FAX 952-233-3801 •www.ShakopeeMN.gov Sewer Availability Charge (SAC) Credit Application—Attachment Rahr Corporation 3-24-2015 #1-Property Identification Number(s): - 4 Project sites at West 152 Ave.and 3`d Avenue.(All Rahr property) #2-Number of credits requested: - to be determined,application has been made to the METC PROJECT INFORMATION #3-Description of improvements and any anticipated"change of use"that the proposed project will result in: The project consists of(4)separate components. 1) BSG Warehouse facility—80,000 ft.,bagging and palletizing operation with distribution warehouse. (former housing&residential) 2) Rahr Technical Center/Pilot Brewing Building—replaces former lumberyard property 3)Maintenance Warehouse—replaces former Peter facility—2nd Ave. 4) Malthouse Production facility—constructed on vacant lot 3rd.Ave. #4-Narrative explaining nature of proiect: 1)BSG Warehouse&Distribution Center: 80,000 SF with a 32'potential clearing height. The building will have internal mezzanine floor resulting in a total usable area of app. 90,000 SF. Of the space,about 6,000 SF will be used for bagging of malt(from bulk loads down to smaller sizes suitable for the craft brewers);the remainder will be used for warehousing&order fulfillment. The warehouse will be used to service customers located in Minnesota and throughout the Midwest. 2) Pilot Brewing&Technical Center:9,300 SF footprint,but will be two stories tall for a total facility size of 18,400 SF. The facility will house a pilot brewing and micro malting center on the first floor. The second floor will house an expanded version of the current malt quality control lab. The facility will further Rahr Corporation's position as the industry leader in brewing ingredients,as it will allow us to better understand how the ingredients we manufacture and/or sell perform in a realistic brewery environment. 3)Maintenance Warehouse: 14,500 SF. The maintenance warehouse will allow for storage of parts needed to maintain an operational malting facility. Rahr operates at 100%capacity and unplanned outages cause damage,both financially and to Rahr's reputation. Critical parts inventory must be purchased,warehoused and readily available 4) Malt House: The malt house will have an approximate 21,000 SF footprint, but will have multiple processing floors for a total manufacturing space of 112,000 SF. It will add 60,000 tons of capacity and return Shakopee Minnesota as the home of largest single site malting facility in the world. The malt house will be adjacent to an existing malt house already on the property.