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City of <br /> <br />ITEM 5.1. <br /> <br />MEMORANDUM <br /> <br />'ver <br /> FROM: <br /> <br /> DATE: <br /> <br />SUBJECT: <br /> <br />Mayor & City Council <br /> <br />Paul T. Steinman, Director of Economic <br />Development <br /> <br />July 30, 1997 <br /> <br />SAC Calculation Formula <br /> <br />Overview <br /> <br />Staff has been working with the owner of the building at the corner of Main <br />and Jackson where Snyder Drug was located. The owner has examined a <br />number of options concerning making improvements to this building to <br />facilitate leasing the main floor which is approximately 6100 square feet. <br />Recently staff has been in contact with local realtors representing a <br />restaurant use for this possible location. A primary question has been raised <br />which, until answered, would preclude this restaurant use from utilizing this <br />space. The question is what the cost of SAC and WAC charges would be for <br />this type of use. Staff has calculated that if the restaurant were to be able to <br />seat between 100 and 150 people, SAC and WAC charges would equal <br />approximately $25,000-$35,000 under the current formula. This formula is 1 <br />SAC and WAC for each 8 seats. A SAC unit equals $1,300 and a WAC unit <br />equals $1,200. <br /> <br />In providing this information to the realtors representing the restaurant use, <br />it is evident that unless this fee is reduced significantly, this user, and <br />possibly any other restaurant user, would not be able to locate in this <br />building. Staff feels strongly that there is a need to reduce these fees <br />significantly in the historic portion of downtown Elk River in order to induce <br />restaurant uses. Such uses are highly desirable in that they are typically <br />destination uses and have the ability to attract significant numbers of people. <br />This type of use in downtown would help to spur secondary retail activity or, <br />at a minimum, help to stabilize the current level of retail activity in <br />downtown. <br /> <br />Staff has attached a draft proposal to reduce the SAC unit calculation for <br />restaurant uses locating in an existing facility within the geographic <br />boundaries described as follows: <br /> <br />13065 Orono Parkway · P.O. Box 490 · Elk River, MN 55330 · TDD & Phone: (612) 441-7420 · Fax: (612) 441-7425 <br /> <br /> <br />