5. EDSR 05-13-2013 - Laserfiche WebLink

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Elk REQUEST FOR ACTION River To ITEM NUMBER Economic Development Authority 5. AGENDA SECTION MEETING DATE PREPARED BY May 13, 2013 Clay Wilfahrt,Assistant Director of Economic Development ITEM DESCRIPTION REVIEWED By Consider options for Briggs Companies building in the Elk Jeremy Barnhart, Deputy Director, River Business Park CODD REVIEWED BY ACTION REQUESTED Consider options for the sale of a portion of Parcel A of Lot 1,Block 1 of Northstar Business Park. BACKGROUND/DISCUSSION The Briggs Companies owns a building at 11110 Industrial Circle NW in Elk River which houses the Briggs Companies,Ameriprise Financial, and Professional Services Bureau (PSB). PSB employs roughly 80 people, and both Ameriprise Financials and the Briggs Companies have offices in the building. There are approximately 50 parking spaces on site. The large number of employees coupled with limited parking on site pushes parking to the street, an undesirable situation. Pat Briggs of the Briggs Companies has expressed an interest in acquiring an acre of land directly to the south from the EDA for$1. He submitted the attached offer to staff in October of 2012. An appraisal conducted in 2012 determined that the portion of the land Mr. Briggs is requesting is buildable and has value considerably higher than what Mr. Briggs is offering. If the land were sold for$25,000 less than the appraised value,it would be subject to the business subsidy for the City and the State of Minnesota and need to meet wage and job goals. Mr. Briggs has stated that he is not able to increase the dollar amount of his offer. Staff explored state and local financing and incentive opportunities with Mr. Briggs prior to approaching the EDA with the land offer,which could be applied to the land purchase,reducing his expense. PSB has expressed that they may be compelled to move should the parking issue not be resolved especially as they anticipate an increase in employment from 80 to 100 by the end of 2013. PSB has also expressed an interest in potentially purchasing the building from Mr. Briggs. In the review of the purchase offer, and with a desire to help the business as much as possible, staff considered several options. First, the EDA could approve a sale of the land for$1. This option would resolve the parking situation and likely keep PSB in Elk River, however it also presents some challenges. First, the EDA would forego a substantial sum of money by accepting an amount considerably less than the appraised value. Also the EDA would set a precedent of selling land extremely inexpensively to businesses creating or retaining jobs which could lead to poor negotiating position in the future. Lastly, r / , EIEI / r N:A Departments\Community Development\Economic Development\EDA to move\Agenda\Year2013\5-13- 2013\Request for Action Briggs Land Request(1).docx NATURE