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<br />August 2, 1999 <br />Page 3 <br /> <br />. <br /> <br />average of 56 percent has been transferred out to the general fund or to help <br />with public projects. This amounts to an average of $170,617 per year. <br /> <br />The new Northbound Liquor Store site on Highway 169 was purchased in the <br />summer of 1995 for about $7.03 per square foot or $386,217. When the <br />Northbound store was being planned in early 1996, the City Council decided <br />to pursue a future Westbound Liquor Store site based on the belief that the <br />city would need at least one additional municipal liquor store. In February <br />1996, negotiations started for a Westbound Liquor Store site with the <br />selection criteria being a site on the north side of Highway 10, at a signalized <br />intersection and on the west side of town. Eventually, the city purchased the <br />center parcel of the three lot Hartman commercial plat for $5.50 per square <br />foot, or approximately $358,172. The city could not obtain the eastern-most <br />parcel of this plat, which is right at the signalized intersection, because it <br />was planned that this site was going to be sold to SuperAmerica for a gas <br />station. <br /> <br />. <br /> <br />The city wanted a site on Highway 10 near a signalized intersection based on <br />some of the municipal liquor store business coming by way of drive-by traffic. <br />Traffic counts on Highway 10 (at Main Street) have increased from <br />approximately 26,000 in 1992 to 32,000 in 1999. Similarly, traffic on <br />Highway 10 (at Main Street) has increased from approximately 19,000 in <br />1992 to 24,000 in 1999. Based on my understanding of the municipal liquor <br />industry and the expertise of the current and past liquor store managers, it is <br />strongly believed that the city will need at least one more municipal liquor <br />store to adequately serve our constituents. <br /> <br />Recommendation <br /> <br />It is recommended that the city reject the offer to purchase our site by Allina <br />(Option I). In order to plan for the long term, the city needs to retain a liquor <br />store site at this time, as good, quality sites are difficult to purchase. In <br />order to accommodate Allina, it may be acceptable to switch lots and utilize <br />the western parcel of this three-lot subdivision, but this "lot swap" would be <br />more attractive if the city was offered some money for this exchange of a very <br />good commercial lot for a less desirable parcel. (If the city really wanted the <br />western parcel, we would have purchased it three years ago.) Finally, it <br />would be better to have the eastern lot right next to the signalized <br />intersection versus the western lot. <br /> <br />. <br /> <br />\ \ Elkriver\ sys \ SHRDOC \ADMIN\ALLINA.DOC <br />