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HomeMy WebLinkAbout7. Facade Improvement Loan Program Expansion #-7 CITY OF SHAKOPEE MEMORANDUM CASELOG NO: Not Applicable TO: Shakopee Economic Development Authority (EDA) Mark McNeill, City Administrator and Executive Director for the EDA FROM: R. Michael Leek, Community Development Director SUBJECT: Fayade Improvement Loan Program Expansion MEETING DATE: October 17, 2006 INTRODUCTION: In 2005 the Council budgeted $50,000 for a Downtown Fayade Improvement Program. The specific structure for the program is detailed in the attached memorandum of October 25,2005. A key requirement of the current program is that "...the improvement would have to be to a street-facing fayade and would have to be a restoration or enhancement project, not regular maintenance." The improvements are to follow the "City of Shakopee Downtown Design Guidelines." Earlier this year, Council provided direction to expand the program to the First Avenue corridor if the funds were not expended by September of this year (See staff memorandum dated April 12, 2006). Currently about $25,000 remains in the program. Council is asked to provide direction to staff on the specifics of expansion of the program at this time. DISCUSSION: The current program has a balance of about $25,000. Staff has received two additional applications for relatively minor amounts related to signage and other improvements. These applications are on the EDA's agenda for consideration. If granted, these loans would reduce the balance to closer to $16,000. The most recent loan that was approved was for $25,000. Thus, if another, similar loan request were to be received, it would likely exhaust the current program funds. Recognizing that the Council's direction was to expand the loan program if the funds were not exhausted by September 1, 2006, given the relatively small amount of funding in the program, it appears to staff that the EDA may want to consider the following alternative strategies; . Do not extend the program at this time; . Extend the program to the First Avenue corridor, but limit its use for the time- being to historic properties only (perhaps as identified by the Historic Preservation Advisory Committee), and direct staff to prepare guidelines for these H:\CC\2006\10-17\EDA facade improvement expansion 2.doc 1 properties that are consistent with the City of Shakopee Downtown Design Guidelines; . Extend the program to all business properties in the First A venue Corridor, and direct staff to prepare guidelines for these properties that mirror the intent and criteria of the current program. ALTERNATIVES: 1. Take no action, which would result in not extending the program at this time; 2. Offer and pass a motion directing that the program be extended to the First A venue corridor at this time, but for historic properties only (perhaps as identified by the Historic Preservation Advisory Committee), and further directing staff to prepare guidelines for these properties that are consistent with the City of Shakopee Downtown Design Guidelines. 3. Offer and pass a motion directing that the program be extended to include all business properties in the First Avenue Corridor, and directing staff to prepare guidelines for properties within the First Avenue corridor. 4. Table the matter for other, additional information ACTION REQUESTED: Offer and pass a motion giving staff direction regarding the following items; 1. Whether to extend the Fayade Improvement Loan Program at this time; 2. Whether, if the program is extended, the geographic boundaries should be expanded to the west and east as depicted on the map accompanying this report; 3. Whether to develop separate guidelines for historic vs. non-historic structures within the expansion area. .--- . . , R. Michael Leek Community Development Director H:\CC\2006\lO-17\EDA facade improvement expansion 2.doc 2 " City of Shakopee Memorandum TO: Economic Development Authority FROM: Kris Wilson, Assistant to the City Administrator SUBJECT: Downtown Fayade Improvement Program DATE: April 12, 2006 Introduction At its November 1 meeting, the EDA approved guidelines for a Downtown Fayade Improvement Program. The guidelines adopted were those recommended by the Economic Development Advisory Committee and the Historic Preservation Advisory Committee. The staff memo prepared for that meeting is attached. Recently a Councilmember asked that the EDA revisit this issue, with particular attention to the issue of which properties are eligible. Background As approved by the EDA on November 1, the program is limited to commercial properties in the core downtown area - the south side of 1 st Ave. from Fuller to Somerville St. and buildings fronting Holmes, Lewis and Sommerville between 1 st and 2nd Ave. If funds remain after September 1, the program will be expanded to the entire 1 st Ave. corridor. Previous grant/loan programs have also targeted this area ofthe city, andthis had led to criticisms that the City is excluding other areas of the city in need of revitalization assistance. This is the issue that the EDA is asked to revisit. There are two reasons for targeting the core downtown area: 1. This area includes a concentrated number of historic commercial buildings that are a fundamental part of Shako pee's history and identity as an old river town. Focusing revitalization efforts in this concentrated area can result in a more visible impact and the preservation of historic buildings that cannot be replaced. 2. Several years ago the City hired a consultant to prepare design guidelines for the restoration of commercial buildings in the core downtown. These guidelines provide a clear understanding ofthe types of improvements the city is willing to fund. We do not have any design guidelines for buildings along the broader 1 st Ave. corridor. On the other hand, there are properties along 1 st Ave. to the east and west of the core downtown area that are in need of revitalization as well. It should be noted that the City does have money to make deferred loans to residential properties in a broader area of the city. These are funds that were originally granted to the City as part of the state's Small Cities Development Program, loaned out to qualifying property owners and have now been repaid to the City by owners selling their properly before the end ofthe deferment period. At this time, approximately $46,000 is available in this fund. This includes ... , residences along Bluff, 1 st and 2nd Ave to Naumkeag St. on the East and along 1 st Ave. to Clay St. on the West. Attached for your information are draft copies ofthe promotional materials developed for the Downtown Fayade Improvement Program. We had not yet mailed these materials due to some questions regarding the application form that required our attorneys' review. Action Requested: The EDA is asked to discuss whether to proceed with the program targeted at the core downtown area or to adjust the eligibility requirements to include a larger portion of the City and provide direction to staff. ,. City of Shakopee Memorandum TO: Economic Development Authority FROM: Kris Wilson, Assistant to the City Administrator SUBJECT: Downtown Fac;ade Improvement Program DATE: October 25, 2005 The 2005 EDA budget includes $50,000 for a Downtown Fac;ade Improvement Program. Input on the appropriate terms for the program was sought from the Economic Development Advisory Committee, the Historic Preservation Advisory Commission and the Shakopee Downtown Partnership. Based on the input received from these groups, it is suggested that the program be structured as follows: 1. A deferred loan program where the loan would be forgiven on a sliding scale over a five-year period ifthe property owner does not sell the property during that time. 2. The maximum loan amount would be 50 percent ofthe cost ofthe improvement, up to a maximum of $25,000 per property. While this might result in only two loans being made, all three groups consulted felt it was better to get the money out there and have a visible impact on just a few buildings, rather than spreading it too thin or setting the maximum so low thatit fails to provide the desired incentive. 3. Initially, eligible properties would be those located within the boundaries of the city's Commercial Historic Downtown, as identified in the City of Shakopee Downtown Design Guidelines. If, by September 1,2006, the EDA has not received enough qualified applications from property owners in the above geographic area to expend the allocated funds, commercial properties along the 1 st Ave. corridor would become eligible to apply. 4. Preference would be given to those properties that did not receive assistance through Shakopee's Small Cities Development Program (SCDP) grant. 5. In order to be eligible, the improvement would have to be to a street-facing fac;ade and would have to be a restoration or enhancement project; not regular maintenance. Improvements would be required to follow the guidelines contained in the City of Shakopee Downtown Design Guidelines. .. ~ 6. Applications would be reviewed by a committee composed of one member from each of the following groups: the Economic Development Advisory Commission, the Historic Preservation Advisory Commission, and the Board of the Shakopee Downtown Partnership. The committee's recommendations would be forwarded to the Shakopee Economic Development Authority for final action. Budget Impact: The 2005 EDA budget includes $50,000 to fund this program. Recommendation: Staff recommends that Council approve the Downtown Fac;ade Improvement Program with the terms outlined above and authorize staffto begin marketing the program to eligible property owners and occupants. Kris Wilson Assistant to the City Administrator