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Blue Ribbon Panel Minutes: 12/16/09 and 1/13/10

12-16-09BlueRibbonPanelMinutes

01-13-10BlueRibbonPanelMinutes

Blue Ribbon Panel Agenda for January 13, 2010

Agenda

Minnesotan Homeownership Declines

Minnesota 2020 — Minnesotan Homeownership Declines.  A trend that doesn’t seem to follow the real estate bubble in that ownership rate dropping since 2002.  I wonder how Red Wing is trending and, if home ownership is trending down here, what does that mean in terms of economic development.

Minnesota 2020 – State Cuts to Drive 2010 Property Tax Increases

Minnesota 2020

The Looming Public Employee Pension Crisis

Click the image above for a short video report.

Expect the Minnesota Legislature this coming session to address the issue of increasing contribution rates for public employees and employers under TRA, and PERA in order to make up for investment losses.  The net result for cities, counties and school districts will be increased expenses, which will result in more budget cuts, or increased levies.

Go to Pension Tsunami for more news on public pensions and OPEB (Other Post Employment Benefits), which is mostly retiree health care.

MN Nano Economic Impact Analysis

MN Nano is a statewide, private-sector led coalition of industry, higher educational institutions, government entities, service providers and investors with a common goal to establish Minnesota’s standing as a region of excellence in nanoscience.

Vision
Minnesota will be a leader in nano-scale science and engineering, with sustained economic growth via innovative nanotechnology applications.

Mission
To advocate for increased interest and investments in nano-scale education, research, development and commercialization, focusing on key applications that build upon Minnesota’s strengths such as: advanced materials, sensors, electronics, energy, agriculture, food science, biotech and biomedical technology.

Read their Economic Impact Analysis here.

See also, Rushford Hypersonic.

Albert Lea Tribune | Should the billing rates for sewer and water be revamped?

A very informative article about setting sewer and water rates, a sensitive topic in Red Wing.  Economic Development issues are raised.

Albert Lea Tribune | Should the billing rates for sewer and water be revamped?.

Decade in jobs: After recession, area looks for growth (Winona)

Decade in jobs: After recession, area looks for growth.

As Revenue Plunges, Stadium Boom Adds to Municipal Woes – NYTimes.com

As Revenue Plunges, Stadium Boom Adds to Municipal Woes – NYTimes.com.

via As Revenue Plunges, Stadium Boom Adds to Municipal Woes – NYTimes.com.

Presentation to Establish Port Authority

Attached is a transcript of the Red Wing City Ways & Means Committee meeting of February 13, 1985. Thank you Dean Massett and Carol Duff for providing this valuable information.

The transcript includes a detailed discussion with attorney Jim Holmes in which the use of a Port Authority is explained and compared to other economic development tools, such as an EDA.  Legal issues of governance, accountability and transparency are also discussed.

Keep in mind this meeting was held nearly 25 years ago, so economic conditions, business tax subsidies, and state statutes regulating E.D. tools have changed.  Below are links to two subsequent events.

Notes from Joint Meeting of Port and City Council. June 16, 1993.

Red Wing Economic Development Summit, June 23, 1994.

As always, you can view online or download.

Freedom Writers: Teaching Hope

Freedom Writers Foundation

There are Jobs, and then there is JOBZ.

In 2003, the Minnesota Legislature enacted an economic development program called JOBZ that attempts to promote economic growth in Greater Minnesota through a variety of tax subsidies.  I think it is fair to say that much of the Red Wing Port Authority’s work in the past two to three years has been involved with the JOBZ program.  That would likely be the case in many Minnesota communities.

In 2008, The Office of the Legislative Auditor stated, “We found that JOBZ has been used appropriately in some cases and helped create jobs. But we also found significant problems with the program’s design and implementation, resulting in some cases of ineffective and inappropriate use of tax subsidies.”

Some business subsidies under JOBZ have a direct local impact by way of an exemption from local property taxes, while at the same time have a state revenue impact in terms of breaks for sales, income, and corporate taxes.  Measuring the cost versus benefit is no small task.

Legislative Auditor’s Summary Report

Legislative Auditor’s Full Report

MN. Dept. of Revenue:  JOBZ Tax Exemptions

JOBZ Statewide Report 9/25/2009

Hollowing Out The Middle

Hollowing Out the Middle website

See also my December 13th post on “The Rural Brain Drain” for more information

John Lennon. “Beautiful Boy”

Business Subsidies: Accountability and Transparency

How much are we paying to get jobs through subsidies?   That is indeed the big question.  Subsidies include property tax abatements, tax increment financing, JOBZ programs and others.  The information below should give you an idea at least of the process involved in granting subsidies.  Measuring the value or success of a subsidy is another matter that the community needs to address.

“Former DFL Senator Hottinger sponsored Minnesota’s groundbreaking law instituting new standards of transparency and accountability for state and local economic development subsidies. The 1995 law and its subsequent enhancements required that companies who receive public subsidies but fail to reach job creation goals repay the subsidy with interest. The legislation also mandated increased corporate disclosure, wage standards for the jobs created, and public hearings before large subsidies could be granted. The law is credited with recouping millions of dollars in state funds and increasing civic engagement around issues of economic development.”

Below is a link to an excellent video about how Minnesota has addressed issues of accountability and transparency in business subsidies, and to understand the process currently in use in Red Wing and throughout the State.  This video quickly helped me get a better understanding of our current system.

You can get the link to the video here, or download the mp3 podcast.   This link will take you to the Minnesota Dept. of Employment and Economic Development (DEED) page on Business Subsidy Reporting.  Minn. Stat. §116J.94 is the statute on regulating business subsidies.

Kent D. Laugen

Economic Development Digital Library for the Community

I am in the process of building a digital library for the community on the broad topic of economic development.  The library will contain articles, documents, video and other links.

Your input is invaluable, so please let me know what you’d like to see added to the library.

I am still in the process of learning the capabilities of WordPress, so you’ll have to bear with me.  (any WordPress geeks out there?)  In the meantime, clicking on a category should direct you to a post that will have a link to a document of interest. Hopefully, I’ll soon have a link that you can go to that will show all documents in the Community Digital Library.

Kent D. Laugen

Visitor Interest in Red Wing

A study from Gustavus Adolphus Geography students shows the origin of requests for information from the Red Wing Visitor and Convention Bureau.  (VCB) Click the map to go to the study link.  I’ll try to find the actual study.

Different Choices: Redesigning Public Services

“Minnesotans must reject the myth that solving a huge and growing state financial problem means only higher taxes or painful cuts in services.

There is a much better approach: Looking at problems with fresh eyes; re-examining old assumptions; concentrating on outcomes; not being afraid to challenge traditional practices; advancing unconventional ways of solving the problems.

The creative abilities of citizens and organizations of all political leanings statewide, so well demonstrated in the past, must now be energized to develop proposals for redesigning public services to an extent never before contemplated.”

I hope this is what the Panel is about.  A broad-based group of creative, talented, independent-minded, local citizens committed to working together to address the issues of today and tomorrow.

Read the short paper from the Civic Caucus here.

December 16, 2009 Meeting Agenda and Related Documents

Agenda

December 16, 2009 @ 7:00 p.m.

City of Red Wing Council Chambers

I.  Welcome from Co-Chairs Dennis Egan and Scott Wordelman

II.  Introduction of Panel Members

III.  Mayor’s Charge to Panel

IV.     New Business

a.  The Challenge of Economic Development – Ann Markusen

V.  Next Meeting Date

VI.       Adjournment

Ann Markusen was kind enough to send the documents linked below for your review:

Markusen: Artists’ Centers

Markusen: The Distinctive City: An Economic Development Approach

Bartik: Local E.D. Policies

Bartik:  Evaluating the Impacts of Local E.D. Policies

The Rural Brain Drain

From the Chronicle of Higher Education comes this disturbing article.

The hollowing out of our communities is not news for us in rural Minnesota.  The news will be what we do about it. Will school districts, cities, and counties begin to act in concert to address this issue?  What will the Panel do?

You can purchase of a copy of Hollowing Out the Middle: The Rural Brain Drain and What it Means for America here. Watch Mr. Carr on C-SPAN discuss in vivid terms, the hollowing out.  A compelling video.

Mr. Carr is also the author of Clean Streets, which is partially available here at Google Books.

Methland: The Life and Death of an American Small Town. Watch author Nick Reding discuss his book about how economic disparities and pressures contribute to middle America disintegration.      C-SPAN. More about the book here.

On a lighter, and often humorous note, Sir Ken Robinson makes the case for the need of an educational system that better nurtures the creativity in all our children.  His contention is that creativity now is as important to education as literacy.  About 20 minutes in length here. If you have time, browse the TED website for some extraordinary videos.

Red Wing Community Sustainability Report

From the report’s introduction:

“The concept of sustainability is incorporated throughout the City of Red Wing Comprehensive Plan. According to the Comprehensive Plan, Red Wing should always consider the long term impact of decision making with an understanding of the interdependence between our community and the natural ecosystem.”

Comments will be appreciated regarding the genesis of the report. This is a larger file, so please give it a little time to load.

Kent D. Laugen

Downtown Red Wing Action Plan

A must read of an excellent comprehensive study on where we are, how things may change, and where we are going. Click the image to view the report.

Local Municipal Spending

Local property taxes are often used by cities to compare themselves to other communities.  It is also a factor in business retention/location decisions.

For comparison purposes, I’ve used city spending instead of property taxes, as other communities don’t have a nuclear power plant contributing to the tax base. I used the same baseline for comparison purposes. LGA unallotment has impacted all of these cities.  I’ve compiled data on LGA cuts for the cities listed in the original comparison. Obviously, Red Wing is not alone in substantial LGA cuts.

The spending comparison linked below lays out current expenditures, public safety, and economic development, and compares Red Wing to nine other area cities.  Public safety and economic development are part of total current expenditures.  Current expenditures do not include debt service or capital outlays. I’m also including the 2009 State Auditor’s Report on Minnesota City Budgets upon which my comparisons are based.

City population is based upon 2008 census estimates. Of the cities listed, Red Wing, Albert Lea, Austin, and Winona have experienced population declines since the 2000 census.  The other cities have grown.

Each city has different issues, and understanding our spending is not as simple as comparing it to others, yet comparisons can be useful.

Red Wing Spending Comparison

State Auditor’s Report

Minnesota Census Information

LGA Unallotment Comparison

Port Authority Timeline

When I began to review Port Authority minutes I decided to make a timeline for the past five years.  As usual, you can view online or save to your desktop.  Use the toolbar back and forth arrows to move within the document. I hope you find it useful.   Timeline.

(The timeline was made with BeeDocs Timeline 3D for Mac and exported into Adobe Acrobat.)

Feasibility of Fiber Optic Network in Red Wing

The City of Red Wing, via Hiawatha Broadband, has applied for federal stimulus funds for a build out of a fiber network in Red Wing.  Attached is a feasibility study of Fiber To The Home  (FTTH) in Red Wing. The issue of the cost and impact of a local fiber network on our economic development will soon be before the City Council as a decision on the application for funds is due any day now.

EDA Spending Comparison

The City of Faribault recently did a survey of EDA spending of cities in our  area. You can view it here.  Red Wing has a lodging tax, but that is not part of the Port’s budget.

Blue Ribbon Panel Members

The members of the Blue Ribbon Panel on Economic Development are:

Dennis Egan, Co-Chair

Scott Wordelman, Chair

Scott Adkisson

Donna Anderst

John Becker

Kenneth Bush

Carolyn Hedin

Gary Iocco

James Johnson

Kent D. Laugen

Dan Massett

Michael Murphy

Kathy Radmer

Duffy Schafer

Denny Tebbe

Linda Thielbar

Public Schools and Economic Development

Below are links to a sample of articles that are helpful in understanding the role education plays in economic development.  An understanding of economic development is not complete without a serious look at the role of education.

Public Schools and Economic Development:  What the Research Shows. Here.

Establishing Partnerships between the Business Community and Rural Schools. Here.

Dancing Partners:  Schools and Business. Here.

Are too many students going to college? Here.

Urban Fiscal Challenges: C-Span Nov. 19, 2009

Brookings Metropolitan Policy Program and the National League of Cities hosted a forum on city fiscal conditions, the responses being undertaken by creative mayors, and the implications for national economic recovery. Following reviews of current and projected trends in local government fiscal conditions by Chris Hoene of the National League of Cities and Steve Cochrane of Moody’s Economy.com, Wall Street Journal economics editor David Wessel moderated a panel of sitting mayors, including Michael Nutter of Philadelphia; Chuck Reed of San José, California; Scott Smith of Mesa, Arizona; and Elaine Walker of Bowling Green, Kentucky. Jared Bernstein, chief economist and economic policy advisor to Vice President Joseph Biden, closed the session.  Click here.

Historical review of economic development in Minnesota

Economic Development Theory and Practice in Minnesota – 1950s to the Present.  Wilbur R. Maki, Professor Emeritus, University of Minnesota (2005)  link

Port Authority statute, enabling resolutions, and by-laws

Here you’ll find the state statute establishing the Port.

You’ll find the Port Authority enabling resolutions here and here.

Amended by-laws here.

Guaranteed Energy-Savings Program

From the StarTribune:  Guaranteed energy-savings contracts work like this:

A city chooses a company to evaluate energy improvements. The company then oversees the installation of projects the city wants and guarantees that energy savings will cover the work, the company’s fee, and up to 20 years of debt service on money the city borrows to pay for the projects. The company posts a performance bond to ensure that it will pay the difference if the savings are less than promised.

See also, Minn. Stat. §16C.144

Municipal Energy Financing and PACE Bonds

To read “Guide to Energy Efficiency and Renewable Energy Financing Districts For Local Governments go here.

PACE ( Property Assessed Clean Energy) bonds are a new tool for communities to use for commercial and residential property owners to make energy improvements to their property.  The BRP will be examining this issue and make recommendations for implementation.  Go here to read more.

Mayor Announces Formation of Blue Ribbon Panel on Economic Development

On November 9, 2009, Red Wing Mayor John Howe announced the formation of an independent Blue Ribbon Panel on Economic Development.  The Mayor’s Blue Ribbon Panel ( BRP) will be charged with the task of  reviewing the broad concept of economic development for Red Wing, including accountability, structure, education, sustainability, and whatever other areas the Panel wishes to explore.