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HomeMy WebLinkAbout06-20-07 '!e- EN HILLS ECONOMIC DEVELOPMENT COMMISSION WEDNESDAY, June 20, 2007 7:30 A.M. Upstairs Conference Room, Arden Hills City Hall I. CALL MEETING TO ORDER II. ROLL CALL III. APPROVAL OF MINUTES A. May 23, 2007 IV. CHESAPEAKE COMPANIES PROPOSED REDEVELOPMENT OVERVIEW - Chesapeake Companies • V. ECONOMIC DEVELOPMENT STRATEGIC PLAN - Chair Kunkel A. Presentation to Council Review B. Redevelopment Location Selection VI. BUSINESS FINANCE POLICY DISCUSSION — Karen Barton VII. BUSINESS LICENSING DISCUSSION — Karen Barton VIII. COUNCIL UPDATE — Mayor Harpstead IX. OTHER BUSINESS X. ADJOURN • City of Arden Hills 1245 West Highway 96-Arden Hills Minnesota 55112 Phone 651.792.7800-Fax 651.634.5137 www.ci.arden-hills.mn.us \\Metro-inet.us\ardenhills\Admin\Committees\Economic Development Commission\Agendas\2007\06-20-07 EDC Agenda.doc ,ITEN�HILLS • CITY OF ARDEN HILLS, MINNESOTA ECONOMIC DEVELOPMENT COMMISSION MAY 23, 2007; 7:30 AM CITY HALL -- 1245 WEST HIGHWAY 96 I. CALL MEETING TO ORDER Chair Kunkel called the meeting to order at 7:38 a.m. New member Ed Van Holtum was introduced who provided background on himself. H. ROLL CALL Present: Chair Bruce Kunkel, Nancy Kneeland, Ed Van Holtum, Rob Davidson, Jim Paulet, Mayor Harpstead, Community Development Director Karen Barton, City Administrator Michelle Wolfe. Absent: Dale Beane, Ed Werner, Chris Ashbach, Ray McGraw. III. APPROVAL OF MINUTES —MAY 16, 2007 The minutes from the May 16 meeting were approved as amended. IV. ECONOMIC DEVELOPMENT STRATEGIC PLAN • A. Review Revised Plan B. Discuss Presentation to the Council The Mayor noted that he polled Council members regarding the plan and they were receptive to it. Two members expressed concern. The Council expressed they want the plan to be market driven and not City driven. He also indicated the Council had a reluctance of using eminent domain for commercial business purposes. The group also indicated they were concerned about this as well. Chair Kunkel said his only exception would be if the City had a blighted property then he could see using eminent domain on the property. City Administrator Wolfe expressed that she felt it is important for the EDC to build a relationship with the Council. She indicated in the past, committees have not worked on relationship building with the Council. The Mayor indicated the revised budget for this plan was considerably lower so the Council was more comfortable now. Jim expressed concern with not going through all the specific items in the document thoroughly to make sure they were all comfortable with the document. The group expressed that they feel the document has been reviewed for two years and they were comfortable moving forward at this point. Nancy asked if the Council accepted the plan if it was binding to them. The Mayor indicated by law nothing is binding to the City Council. Nancy suggested that that point should be noted to • the Council as well. 7 EDC Minutes May 23, 2007 Page 2 of 4 Chair Kunkel reminded the group that the document is being presented to the Council at a work session and there will more than likely be more changes and edits that the EDC will need to make before the Council formally is presented with the plan for approval at a regular Council meeting. He also asked that the City Attorney be present at that meeting. Nancy asked the group if calling the document a "vision" versus a "plan" might be helpful in gaining Council acceptance of the document. Chair Kunkel said the document is a "plan" to get to an end point and wants to emphasize this when the document is presented. Rob made a motion that the group approve and then present the plan to the City Council. The motion was seconded by Nancy. The group suggested the presentation of the document be listed first on the June18 work session agenda. The Mayor suggested the spirit and passion that Ray McGraw demonstrated at the last meeting be demonstrated when the document is presented to the Council. V. BUSINESS LICENSING DISCUSSION Community Development Director Barton noted that 12 surrounding communities were polled as to their business licensing program—whether or not they,had one, their fees, and their reason for • the program. Six communities had responded to date. She indicated she would like more time to be able to gather input from the other 6 communities to gain a broader sampling. Community Development Director Barton informed the group the City took in approximately $13,000 last year in business licensing fees. The money was directed into the General Fund. The Mayor expressed he thought the timing on altering the business licensing was important as it affects the budget. Community Development Director Barton will continue soliciting feedback from surrounding communities and present this information at the next EDC meeting and the group can then work from that data on how they want to proceed with reviewing the City's licensing program. • EDC Minutes May 23, 2007 Page 3 of 4 • VI. REDEVELOPMENT DISCUSSION A. Redevelopment Designation Process B. Redevelopment Tools Community Development Director Barton presented a memorandum on redevelopment designation processes and tools available. She indicated redevelopment designation is helpful if the City intends to pursue grants for a specific redevelopment project. Designation can be done through Council resolution or placed in the City Comprehensive Plan. Timing for adding it to the City's Comprehensive Plan would be good as that plan is currently being updated. Community Development Director Barton noted that a Redevelopment Plan could utilize a Master Developer or the City could go in and acquire properties. The City can also choose to solicit developers as well. Some tools include creating a TIF district, tax abatement of the City portion,the Economic Development Authority (which is the City Council) could levy, grants can be pursued, the City can levy or referendum, special legislation can be created for a special service district tax. She asked the group how they wanted to proceed. The Mayor noted the City currently has two TIF districts which are the Cottage Villas area and the Gateway area. Rob asked if a TIF district time can be extended, or if it can be terminated and redesignated so it can encompass a longer time frame to help the City and Developer gain more • benefits from it. The Mayor thought this was not possible. Ed noted that in his past experiences, a lot of community involvement and outreach is important when developing a redevelopment plan. He also thought developing priorities early and gaining a"buy-in" from the community early on is essential. Chair Kunkel indicated he believes the group needs to focus in on a specific property and not try to work on several properties at once. He suggested the next meeting be about selecting what property to focus the group's efforts on. The Mayor suggested the group start by working on the former City Hall site that is located along Highway 96 because it-is not on the City's tax roll. He indicated it is important that it be pointed out to the purchaser of the property that any development at that location has to have a "right in" and`aright out" only. VII. COUNCIL UPDATE No update was provided. • J EDC Minutes May 23, 2007 Page 4 of 4 • VIII. OTHER BUSINESS Community Development Director Barton distributed the City's CIP plan to the group for their review as some of the groups' direction could have impact on the City's infrastructure which is part of the CIP plan. IX. ADJOURNMENT The meeting was adjourned at 9:04 a.m. Minutes approved by: Bruce Kunkel, Chair Karen Barton Community Development Director NEXT MEETING The next regular meeting of the EDC is scheduled for June 20, 2007 at 7:30 a.m. • • • DEN HILLS INIF,MORANDUM DATE: June 4, 2007 Work Session Agenda Item 2.B TO: Mayor and City Council \� FROM: Karen Barton, Community Development Directo SUBJECT: Economic Development Strategic Plan Background • In March "06, the Economic Development Commission contracted with De, to develop, an Economic Development Strategic Plan for the Cty. DeSCo spent several months working with the Economic Development Commission, interviewing City Council members, Economic Development Leaders, Key Stakeholders, and the general public to gather information to prepare a strategic plan for the City. On August 16, 2006 the EDC adopted the Strategic Plan. In October of 2006, the EDC presented the Strategic Plan to the City Council. At that time, the Council received the Plan and directed the EDC to make revisions and bring it back to Council for approval. Since that time the Economic Development Commission has had numerous meetings discussing and refining the Strategic Plan. �stit LLQ- v2 �►� C C ���G�(��h� l�J Disco ss�on , Attached is the revised Economic Development trategic P Ln (Attachment A). The EDC has refined the overall goals of the Plan and has prioritized key activities. r D Q City of Arden Hills l City Council Work Session June 4, 2007 • 1l Metro-inet.uslardenhillsPlanning ICommunity DevelopmentlCouncil Agenda ItemsiEDCStrategic Plan Memo to Council 6-4-07.doc Page I of 6 The EDC has identified 19 goals organized around four cornerstones of economic development • and segmented to address the EDC Strategic Imperatives, stemming from the charge of the EDC, as follows: EDC Strategic Imperatives ■ Build an organization that will support economic development ■ Attract and facilitate a community that fosters investment ■ Retain and grow the existing business base in the City of Arden Hills,while at the same time tolerate churning in new business start-ups and existing businesses ■ Develop and maintain strong relationships between City leaders and the largest corporate, academic and non-profit residents, and ■ Create an environment attractive to educated, creative or talented individuals to provide a strong workforce for the City's businesses, with emphasis on quality more than quantity. Four Cornerstones of Economic Development ■ Building an Organization that Supports Economic Development ■ Creating a Community that Fosters Economic Activity ■ Retaining the Existing Business Base ■ Attracting New Investment Economic Development Strategic Plan Goals in summary • 1. Community and Economic Development Director To emphasize the priority of economic development within the city, the EDC recommends changing the title and job description of the Community Development Director to Community and Economic Development Director. 2. Support Staff for Economic Development The EDC recommends the City hire a full-time Economic Development administrative assistant to assume the support responsibilities necessary for meeting these goals and priorities and to aid the Community and Economic Development Director in assuming and managing added responsibilities. 3. Council and Commission Development The EDC recommends periodic training sessions for the City Council and Commissioners to provide information and increased expertise on a variety of topics. City of Arden Hills City Council Work Session June 18, 2007 Il Metro-inet.uslardenhillslPlanninglCommunity Development lCouncil Agenda ItemsIEDC Strategic Plan Memo to Council 6-4-07.doc Page 2 of 6 • 4. Strengthening of City Administrator's Position • Economic development in Arden Hills hinges on maintaining and developing a qualified staff. This is facilitated by the City Administrator having full administrative responsibility of the City while the City Council bears the responsibility for policy and legislative roles. The EDC recommends a consultant be hired to identify and develop the most effective roles and responsibilities for the City Administrator and Council in managing the city. 5. Community Awareness The EDC recognizes the importance of ensuring our residents understand the city's vision for economic development. Therefore, the EDC recommends a section on economic development be included in the monthly newsletter. 6. Redevelopment Director The City of Arden Hills, with the exception of the TCAAP property, is relatively fully- developed. The goal for the City now is to optimize the space available to us through redevelopment. The EDC is recommending hiring a Redevelopment Director to facilitate the redevelopment of degraded and/or under-utilized properties within the city to foster new investment and job creation. It is anticipated that this position would not be necessary until 2012. 7. Gateway Plan The EDC is recommending the installation of gateway signs at significant entrances • to the City to foster our sense of community and welcome visitors and residents. 8. Way-Finding Signage Way-finding signage helps direct visitors and residents to specific destination points, such as the city hall, parks, shopping districts, schools, etc., within the community. These signs add to the style of the community and create a greater sense of presence. The EDC is recommending the installation of way-finding signage in the City in conjunction with development standards for the City as a whole. 9. Central Business District Arden Hills grew up as a suburb to a larger metropolitan center. But as its population grew, so did its need for its own identity. The City did not plan for a city center, however it is finding that it is important to identify one or more areas as such. ( The EDC is recommending the area of Lexington and County Road E be identified as the city center and that a master plan be developed and implemented to create the district. The EDC views this initiative as atop priority. V� City of Arden Hills City Council Work Session June 18, 2007 Il Metro-inet.uslardenhillslPlanninglCommunity Developmentl Council Agenda]temsIEDC Strategic Plan Memo to Council 6-4-07.doc • Page 3 of 6 Tom- 1p��� amt ��- rY,-, 10. Trails &Recreation Program • Arden Hills is bisected by highways and lakes, separating the community into smaller �V4„!Z' residential areas. This separation increases the need to ensure linkage of parks and trails within the community. In 2002, the City's Parks, Trails, and Recreation I {� Committee PTRC) developed a master plan for a parks and trails system within the 2" City. The plan links the trail system into an interconnected network throughout the I(1 community. The EDC fully supports the PTRC master plan and views this as a top Q f`� priority. r� cc 11. Development Sites Arden Hills, as an almost fully-developed community, is running out of developable sites (with the exception of TCAAP) and is at a point where they should start looking at master planning neighborhoods, retails districts, business parks, and the city center. The EDC views this initiative as atop priority and recommends the following areas as key redevelopment sites: Red Fox/Gray Fox business/industrial area, the former City Hall site on Highway 96, the Lexington and County Road E business area, and the Chesapeake property in the Gateway Business District. 12. Business Retention Program The EDC has initiated a Business Retention Program and looks to continue and expand the program to ensure the City is meeting the needs of its base and biggest businesses. 13. Sign Committee • It is unclear whether the city's sign ordinance is overly restrictive of if it is just perceived to be. If it is in fact the opinion of a significant number of city businesses, the EDC believes it would be beneficial to establish a committee to review this matter. The EDC is recommending the City review the number of complaints received regarding the restrictiveness of the sign code and revisit this issue in the six to twelve months. 14. Business Issues on the City's Web Page As a future initiative, the EDC recommends creating a business-only section of the City's web page to be used as a tool for business retention. 15. Resource Database In an effort to project a more supportive business environment, the EDC recommends the creation of a resource directory of business support services available from City of Arden Hills City Council Work Session June 18, 2007 1Wetro-inet.uslardenhillslPlanninglCommunity Development I Council Agenda Items IEDC Strategic Plan Memo to Council 6-4-07.doc Page 4 of 6 • governmental and private sectors. Although the EDC recognizes this as a valuable • initiative, they have determined this to be a later priority. 16. Information Assembly and Readiness Having accurate and up to date information is critical for program success. The EDC recommends compiling and professionally presenting marketing information that can be easily distributed to prospective businesses. 17. Network Development The EDC has determined that the development of a strong, strategic network is essential for the marketing success of Arden Hills. The EDC is recommending that the City staff be provided with an entertainment budget to allow for active network development. 18. Joint Marketing Joint marketing is an effective means of promoting an area or region. The EDC is recommending reviewing and expanding its joint marketing opportunities with various organizations such as the Twin Cities Chamber and Visit Minneapolis North. 19. Individual Marketing Highly targeted marketing to pursue specific prospects is at times necessary. Although the EDC recognizes the value in this initiative, they have determined this J not to be a priority at this time. BUDGET Jb To facilitate the development and implementation of the above goals and objectives, the EDC has prepared a proposed cost estimate/budget associated with the plan (Attachment B). The budget provides for strategic implementation over a 5 year period. Although the Council is being asked to approve the Strategic Plan and proposed budget, it is recognized that 1) the budget is an estimate and will have to be incorporated into the City's annual budgeting process; 2) the City Council is not obligated to approve more than one year of the budget at a time, if at all; and 3) by approving the Strategic Plan and proposed budget, the City Council is not held to adopting the budget. As a means to finance these activities, the EDC is recommending that all fees collected as part of the business licensing program be redirected from the General Fund to the Economic Development Authority (EDA). Additional funding options that the Council may wish to consider include allocation from the General Fund or instituting an EDA levy. City of Arden Hills City Council Work Session June 18, 2007 IIMetro-inet.uslardenhillslPlanninglCommunity DevelopmentlCouncil Agenda]temSIEDC Strategic Plan Memo to Council 6-4-07.doc • Page 5 of 6 Requested Action The EDC is requesting the City Council review and discuss the attached Economic Development • Strategic Plan and further direct staff to bring it to a future City Council meeting for approval and adoption. yukz OU Z R \,JOV 4V Frio City of Ar en Hills City Council Work Session June 18, 2007 tIMeiro-inet.uslardenhillslPlanningICommunityDevelopmentICouncil Agenda ItemsIEDC Strategic Plan Memo to Council 6-4-07.doc Page 6 of 6 • � Council Work Session Agenda Item 28 June 18, 2007 � ATTACHMENT A • EN ]HILLS • Economic Development AL -- — d - ■1 ■ strategic Tian Prepared by the Arden Hills Economic Development Commission 2007 Executive Summary Arden Hills Economic Development Commission has a mission to provide vision • and direction to the economic development efforts for the City of Arden Hills. In the context of this broad mission, the priorities for Arden Hills Economic Development Commission (AHEDC) are- 1. re:1. Ensure a sustainable, profitable, and competitive economic climate in the City; 2. identify and build local capacity to support economic development in the City; 3. Consider and evaluate outside capacity to enhance the economic development in the City; 4. Improve the economic security of Arden Hills' families 5. Enhance the City's Value of Conservation; and 6. Prepare Arden Hills' residents to be productive, positive contributors, equipped with life skills that are valued in the future. To pursue these priorities, the EDC will follow a strategic plan through 2012 comprised of the 19 goals and objectives presented below. In addition, this strategic plan addresses organizational excellence — the alignment of every facet of the Arden Hills Economic Development Commission to support effective • economic development delivery and execution in the City. The 19 goals identified in this plan are organized around four cornerstones for economic development: Building an Organization that Supports Economic Development Creating a Community that Fosters Economic Activity Retaining the Existing Business Base Attracting New Investment Approvals and Adoptions This plan was adopted by the Arden Hills Economic Development Commission at their regular meeting on August 16, 2006, Bruce Kunkel presiding. The plan was then forwarded to the Arden Hills City Council for review and approval. This plan was received by the Arden Hills City Council at their regular meeting on October 9, 2006, Mayor Beverly Aplikowski presiding: • Strategic Plan for Economic Development Page 1 of 20 \\Metro-inettus\ardenhilis\Admin\Committees\Economic Development Commission\AH Strategic Plan-Final 5-16-07.doc Acknowledgements • This Economic Development Strategic Plan is the result of the concerted effort of the Economic Development Commission led by Bruce Kunkel. We are especially thankful to Bruce for his leadership in this effort as well as all he and his commission members do for the City of Arden Hills. Also serving on the Arden Hills EDC are: Chris Ashbach Dale Beane Robin Davidson Kevin Kelly Nancy Kneeland Ray McGraw James Paulet Edward Werner While the planning and preparation of this report was a coordinated effort in every sense, the following key staff member was responsible for individual components of the document: • Karen Barton, Community Development Director Special thanks are also extended to the attendees at all of the one-on-one interviews and phone calls; strategic partners to the City; and members of the community at large who provided input via the survey process for their active contribution to this process. Strategic Plan for Economic Development Page 2 of 20 Metro-inet uslardenhills\Admin\Committees\Economic Development CommissionlAH Strategic Plan-Final 5-16-07.doc Introduction Comm • unity and government leaders across the nation have come to realize their actions can change, alter, and direct the condition of their local economy. The economic quality of life of the residents and the success of businesses many times are directly influenced by the policies and leadership of those who create a climate conducive to economic growth. A strong economy provides benefits to all who experience it while a weak economy puts businesses and residents at risk to the economic effects of external forces. Change is bound to happen. The choice to be made is whether the change will be shaped by the community or by forces beyond its control. Economic development strategies are developed by communities who chose to shape their own future. In areas with strong economies, local governments do not struggle to fund essential services and are usually able to provide expanded programs benefiting all that reside in the area. In such areas, schools are strong, • streets safe and clean, park and recreation programs abundant, and the need to provide social welfare programs for impoverished citizens is reduced. Citizens living in an area with a strong economy enjoy consistent employment, regular wage gains, opportunities for personal advancement, and are able to reliably save for and invest in their future. Businesses are able to plan for consistent expansion, hire full-time employees for the long term, and are willing to risk significant capital, investing in their operations. Communities grow closer, tight-knit; as young men and women, after completing high school or college, remain in the area as growing employment opportunities in their "hometown" capture their interest. In areas with weak or declining economies, the opposite occurs. Local governments struggle to fund essential programs, with budgets under growing pressure to assist the impoverished. Residents have uncertain futures, filled with personal anxieties, with limited employment opportunities, stuck in subsistence level jobs. Businesses employ part-time workers and are • Strategic Plan for Economic Development Page 3 of 20 \\Metro-inet.us\ardenhilislAdmin\Committees\Economic Development Commission\Ahl Strategic Plan-Final 5-16-07.doc unwilling to risk significant capital because of an uncertain future. The best and brightest young men and women must move from the area to seek quality employment, which is not available in their hometown. Nationally, there are more than 6,000 economic development organizations, Chambers of Commerce, and local, regional, and state government offices working in some fashion to improve the economy of their respective areas. Never in history has there been such an effort. Some organizations have large budgets, better community cooperation, and a stronger commitment from local government than others. These areas have the best chance to either maintain or improve the economic quality of life and standard of living of their citizens. Some areas, however, provide little or no attention to economic development programs. They do not fully understand the need to have a constant, aggressive economic development program just to maintain the existing condition. In these areas, typically, the local economy is in decline. Even though local community leaders cannot control the actions or policies of the federal or state government, they indeed can establish policies and create local programs, which assist and foster economic growth. The premise, therefore, of this economic development strategy for Arden Hills is that an active participation in fostering the economic strength of the City is an essential and responsible action for the local unit of government. • Strategic Plan for Economic Development Page 4 of 20 Wetro-inet.us\ardenhills\Admin\Committees\Economic Development Commission\AH Strategic Plan-Final 5-16-07.doc Economic Development Plan for Arden Hills The EDC represents the interests of Arden Hills' residents, but with special • emphasis on the corporate residents that share and contribute to our community resources. The EDC members gather and consider business community input and recommend to the City Council actions that support those interests; monitors business activity; and collaborates with other city committees and commissions to ensure a positive environment for economic development. Finding itself at a crossroad for growth, the City of Arden Hills engaged the services of DeSCo in the summer of 2006 to create a strategic plan for the City. This plan of action was developed from an interactive process involving substantial community input. using DeSCo's proprietary methodology develop and experience of creating strategic plans for communities throughout the United States. The final stage of our engagement resulted in the development of this strategic plan. The plan is segmented to address the EDC Strategic Imperatives: • Build an Organization that will Support Economic Development • Attract and facilitate a Community that Fosters Investment • Retain and grow The Existing Business Base in the City of Arden Hills, while at the same time tolerate churning in new business start-ups and existing businesses • Develop and maintain strong relationships between City leaders and the largest corporate, academic and non-profit residents, and ■ Create an environment attractive to educated, creative or talented individuals to provide a strong workforce for the City's businesses, with emphasis on quality more than quantity. Every economic development organization is pressed with deciding how many of these five cornerstones their budget and staffing will allow them to address. Once they determine which cornerstones they can approach they are then faced with determining the relative emphasis to be placed on each • cornerstone. In the formulative stages of the organization, more work is Strategic Plan for Economic Development Page 5 of 20 \\Metro-inet.us\ardenhillslAdmin\Committees\Economic Development Commission\AH strategic Plan-Final 5-16-07.doc required in the first three cornerstones; Organization, Product and Business Retention & Expansion. More mature programs are able to shift resources • toward the latter cornerstones; Workforce Development and Marketing. At its current level of funding the City of Arden Hills can only address three cornerstones well. Based upon the needs discovered during our strategy sessions we would recommend those to be the Product, Organization and Business Retention / Expansion. It is our recommendation that funding and staffing be secured over the next five years for full implementation of this plan. Assuming this to be an achievable objective, we have written a five year economic development strategy that addresses all five of the cornerstones. However, this program is heavily weighted toward the first three; organization, product and business retention and expansion. Organizational Development • The first component essential to a successful economic development program is to ensure that the organizational capabilities are in place for ED to succeed. In order to accomplish that success, we recommend that Arden Hills address the following organizational issues: 1) Community and Economic Development Director. For economic development to succeed there needs to be someone in the community with these responsibilities. Currently, there is no one on City staff with the title of economic development director. Full time economic development staff is not warranted at this time. However, a minimum of part time attention to economic development is warranted. Our first recommendation is that the awareness of this priority be recognized through title change. We would recommend that the title and job description of the Community Development Director be changed to Community and Economic Development Director as soon as possible. w Strategic Plan for Economic Development Page 6 of 20 \\Metro-inet.us\ardenhills\Admin\Committees\Economic Development Commission\AH Strategic Plan-Final 5-16-07.doc 2) Support Staff for Economic Development The new Community and Economic Development Director cannot • assume the additional responsibilities of their job without sufficient capacity to manage that task. If the City adopts the recommendations of this plan, a full time economic development administrative assistant will be required. This position may be able to be supported from other capacities in the City's system in the early stages, but it cannot be sustained without permanent staffing added to support this goal. Moreover, should TCAAP mature as expected, a support person for economic development as well as a redevelopment director will become a necessity in order to channel the growth opportunities successfully. In the near term, this position needs to be put in place to assume the support responsibilities necessary for meeting this priority. 3) Council and Commission Development Arden Hills is at a crossroads in economic development. In order for the City Council to support the efforts of its staff, there needs to be a higher level of expertise of economic development issues among the elected officials and commission members. Toward this end, we would recommend up to six, three to four hour training sessions be held at City Hall at a frequency of one every other month. These sessions should be open to the public. Topics for discussion may • include: Redevelopment of Existing Properties • Main Street Revitalization The Link Between Education, Workforce and Economic Development Incentive Utilization for Competitive Economic Development Economic Development Finance Leadership in economic development. Why everyone is a leader in Arden Hills. 4) Strengthening of City Administrator's Position Economic development in Arden Hills will succeed by maintaining and developing a qualified staff. This is facilitated when the City Administrator has full administrative responsibility of the City while the City Council bears the responsibility for policy and legislative roles. We would recommend that a consultant be employed to help develop the most effective roles and responsibilities for the City Administrator and Council in managing the city. Strategic Plan for Economic Development Page 7 of 20 \\Metro-inet-us\ardenhilis\Admin\Committees\Economic Development Commission\AH Strategic Plan-Final 5-16-07.doc 5) Community Awareness . The third leg of the economic development is the community itself. If the citizens understand the vision for economic development they will be much more supportive of an economic development mission. Incorporating citizen support for economic development will require that they be informed of the economic development focus of Arden Hills. This will be accomplished by amending the Mayor's already well received newsletter to include a section on economic development 6) Redevelopment Director As a land locked community, Arden Hills is no longer able to stimulate economic growth through the annexation of additional space. The goal for the community now is to optimize the space available to them. Even as the TCAAP project is developed, the need to be more actively involved in the redevelopment of Arden Hills is still present. This position would be strongly skilled in the ability to take existing properties and convert them to new investment and job creation opportunities. Product (The Community of Arden Hills) • The next most important component of an economic development program is the product itself. In a similar fashion to a business taking their product to market, the community needs to look at itself as a product that is being bought, improved and resold over and over again. Enhancing the quality of the product works directly at improving the customer's satisfaction of the buying experience. Activities recommended for consideration in improving the product include: 7) Gateway Plan. Visitors to Arden Hills are often in the community before they realize they are arrived. It is easy to move from a neighboring community without realizing that one has entered Arden Hills. The paths along which one moves into and out of a community are referred to as the gateways. Arden Hills would be well served by placing modern welcome signs at its gateway entrances greeting visitors and residents. • Strategic Plan for Economic Development Page 8 of 20 "Metro-inet_us\ardenhills\Admin\Committees\Economic Development Commission\AH Strategic Plan-Final 5-16-07.doc 8) Way-Finding Signage Moving throughout the community can be made more effective • through the addition of way finding signs. As their name implies, these signs help to direct travelers to specific destination points in the community such as city hall, parks, shopping districts, schools, etc. When incorporated into the design of the gateway signage, they add to the style of the community creating a greater sense of presence that someone has arrived in Arden Hills. We envision this in conjunction with development standards for the City as a whole. 9) Central Business District. The lack of a city center is a common challenge for modern communities. Many of these communities developed similarly to Arden Hills, as a suburb from a larger metropolitan center. Once critical mass was achieved, a community was formed by the first settlers. Since the "city" at that time was the larger metropolitan downtown, the focus on creating a central business district did not exist. However, as the community grew the need for its own identity grew with it. As is frequently the case, the area for a city center was not zoned or planned in the process. Arden Hills has areas of higher retail and service concentration; however they were planned for vehicular transportation and have the look and feel of such a decision. A city center is typically more , pedestrian oriented consisting of: a. Higher buildings b. Zero lot line development (front and side yards) c. Shared parking d. Parks (typically passive) e. Entertainment and dining venues f. Niche retail Areas like this do not currently exist in Arden Hills. This matter is further complicated by the fact that the "historical" city center/main street which many have defined as the area of Lexington and CR E has been "abandoned" by the construction of the new City Hall along CR 96 . As city halls are traditionally located in the City Center, the citizens in Arden Hills question where the true city center may be at this time. • Strategic Plan for Economic Development Page 9 of 20 \\Metro-inet.us\ardenhills\Admin\Committees\Economic Development CommissionlAH Strategic Plan-Final 5-16-07_doc A master plan, zoning changes and development/redevelopment efforts designed to create a city center would benefit Arden Hills greatly. This center would be addressed through the way-finding • signage presented elsewhere in this strategy and supported through various fairs and festivals held purposely in this area to help create greater awareness and presence for the city center in the community. The EDC views this initiative as a top priority. 10) Trails & Recreation Program Arden Hills is challenged by the presence of major segregating assets which are its highways and lakes. These bisect the community into small pockets allowing for separate and unique residential opportunities. However, this separation also increases the need for attention to be paid on linking the individual pieces together. Citizens in Arden Hills reflect their interest in a trails program as they often site the segmented nature of the community in discussions and surveys. The City's Parks, Trails, and Recreation Committee (PTRC) developed a master plan in 2002 . This plan links the trail system into a unified network of pedestrian transportation throughout the community. The EDC views this initiative as a top priority and fully supports the PTRC's Parks, Trails and Recreation Plan. • 11) Development Sites. As a land locked community, Arden Hills is rapidly running out of developable sites for consideration. This shifts thi- rnmmunity's priorities from a development to a redevelopment nature. Due to development pressures in and around the community, single site redevelopments can and will most often be handled by market forces. However, we may have some tracts of land that are under or non- performing and convert them to a higher and better use is what we are talking about here. Arden Hills is at a point where master planning entire neighborhoods, retail districts, business parks and yes, the city center needs to move onto the public agenda. Through this process, a more proactive vision for the city can be implemented. Accomplishing this vision will require the city's participation in the development process through financing, incenting and negotiating key partners to participate in the process. The EDC views this initiative as a top priority and further defines the following areas as key redevelopment sites: The Red Fox/Gray Fox business/industrial area, the former City Hall site on CR 96, the Lexington and CR E business area, and the Chesapeake property in the Gateway Business District. Strategic Plan for Economic Development Page 10 of 20 \\Metro-inet us\ardenhills\Admin\Committees\Economic Development Commission\AH Strategic Plan-Final 5-16-07.doc Business Retention Business development represents some of the core activities of any economic development program. Over time, the importance of a successful retention and expansion program has risen over that of the traditional attraction efforts. The most effective economic development dollars are those spent working with existing businesses since most of the economic growth in a community is the result of established businesses. Here are some activities recommended for Arden Hills. 12) Business Retention Program. Recent research on economic development effectiveness conducted by numerous resources has consistently emphasized that a business retention program focused on the base (those businesses that bring money into the community) and the largest companies is the most successful economic development strategy a community can design and implement. The center piece of this program is the business leader meetings. These should be conducted annually and focused on removing the obstacles hampering business success. Based upon the input received in these meetings, a series of business services can be provided. Since they need to be directly responsive to the needs • presented during the interviews we can only offer suggestions of programs that other communities have used successfully in the past. If the recommended staffing levels are added to the community, we see no reason why 30 to 40 visits per year cannot be conducted in the community. The EDC has initiated and will continue with a business outreach and retention program through quarterly events. 13) Sign Committee. It is unclear whether the city's sign ordinance is overly restrictive or if it is just perceived to be. However, enough businesses in town have the opinion that the sign code is too restrictive so it would be beneficial for Arden Hills to convene a committee to review this matter. These people would be instructed to review surrounding sign ordinances and standards set forth by the American Planning Association. The comments received by this committee can be developed into a recommendation for the EDC and ultimately Council to consider. Inclusion of the City Planner in this effort would be essential. Strategic Plan for Economic Development Page 11 of 20 \\Metro-inet.us\ardenhillsWdmin\Committees\Economic Development Commission\AH Strategic Plan-Final 5-16-07_doc The EDC is recommending the City review the number of complaints received regarding the restrictiveness of the sign code and revisit this in six to twelve months. • 14) Business Issues on Community Web Page. Arden Hills' new web page will work to provide a new more progressive image for the community. This page can become a tool for business retention by creating a section directed toward existing business issues. By creating a business only section of the web page the importance of this component of the economy can be emphasized. Although the EDC recognizes the value in this initiative, we have determined this not to be a priority at this time_ 15) Resource Database. City Hall can position itself as more supportive of business if it creates a resource directory of business support services available from the governmental as well as private sectors. This can be as simple as a Word file that is periodically updated, printed and put on display in City Hall lobby to something as sophisticated as an online database accessible from the City's web page. Although the EDC recognizes the value in this initiative, we have . determined this to be a later priority. Business Retention activities are additive events i.e they do not terminate quickly. Later year implementation of these new priorities will see success when earlier efforts are sustained, perfected and streamlined. Business Attraction Business attraction focuses on identifying companies from outside the area and enticing them to expand or relocate into a community. The goal is simple and straightforward; to secure new jobs and investment that off sets business closures. It is glamorous work, frequently commanding the most recognition of economic development efforts in the media. However, it is extremely expensive and it offers relatively low return on the economic development dollar. Since Arden Hills has not spent a great deal of time in this area, is just now considering an attraction effort and has little budget allocated toward business attraction, we would recommend that you focus more on response capacity than lead generation. With that in mind, here are some activities recommended for Arden Hills. • Strategic Plan for Economic Development Page 12 of 20 Wetro-inet.us\ardenhills\Admin\Committees\Economic Development Commission\AH Strategic Plan-Final 5-16-07.doc 16) Information Assembly and Readiness. Having accurate and up to date information is critical for program • success. There are two places where a community can obtain a competitive advantage in economic development; with the accuracy of their data and the speed of their responses. We would recommend that focusing on this capacity be a higher emphasis at this time as opposed to actively marketing the community. This information should be compiled and attractively packaged in a marketing folder that can be easily distributed. 17) Network Development. The development of a strong, strategic network is essential for the near term marketing success of Arden Hills. A substantial amount of lead generation occurs from the State Department of Commerce. Lesser amounts of leads are generated from the utility company and others come from the development community. These three sources should be the primary source of lead generation for the Arden Hills in the near future (1-3 years). Leveraging these sources can occur in two ways. The simplest is introductory meetings conducted by the city's economic development staff with the leaders in those three sources listed previously. City staff should have an entertainment budget that allows them to take these people out for lunch or after business meetings as they develop relationships with these individuals. • The EDC also recommends involving surrounding communities to lead an area-wide effort. 18) Joint Marketing. As the program matures, the City would be well served to partner with other surrounding cities in a joint marketing effort. This is a common strategy in economic development as companies who are focusing on an area are able to be approached earlier in the decision making process through group marketing than they can be with individual marketing. The sooner that the community can make an impression on a company, the higher their chances are of securing the new investment. The EDC also recommends reviewing and expanding joint marketing opportunities such as with the Twin Cities Chamber and Visit Minneapolis North, for example. • Strategic Plan for Economic Development Page 13 of 20 \\Metro-inet.us\ardenhilis\Admin\Committees\Economic Development Commission\AH Strategic Plan-Final 5-16-07.doc 19) Individual Marketing. • On rare occasions the community may opt to pursue its individualized market efforts. As stated before, these are very expensive and frequently result in little or no return on investment. However, for highly targeted instance where a niche opportunity presents itself, the community would be well served to have the capacity to pursue specific prospects by having the appropriate funds budgeted. Although the EDC recognizes the value in this initiative, we have determined this not to be a priority at this time. Summary Thoughts A successful strategic plan is, by definition, a usable plan — one that directs the City's economic development activities as well as its long-range view, and that yields meaningful improvements in effectiveness, capacity and relevance. To put it simply, not every plan is a strategic plan. A strategic plan is a tool • that provides guidance in fulfilling a mission with maximum efficiency and impact. If it is to be effective and useful, it should articulate specific goals and describe the action steps as we have in this document. As a rule, most strategic plans should be reviewed and revamped every three to five years. This plan is no exception. In its own right, this plan's primary goal is to energize the Arden Hills EDC and to chart a course of action for the organization. This strategic plan for Arden Hills has addressed the needs of the community in economic development while taking strides to ensure that the common pitfalls for plan failure have been averted. As Arden Hills implements the plan in a logical, sequential manner, it will energize its economic development efforts, and with it the community as a whole. Strategic Plan for Economic Development Page 14 of 20 \\Metro-inet.us\ardenhills\Admin\Committees\Economic Development Commission\AH Strategic Pian-Final 5-16-07_doc Appendix A: Economic Development Strategies in a New Economy • Times have changed, and with them so has the underlying economic structure in which we all live. This new economy requires smart thinking by our leadership facilitated by new ways of solving problems and collaborations with sometimes unexpected partners. In the new economy, the ticket to faster and broader income growth is innovation. This economy puts a premium on what the Nobel laureate in economics Douglas North calls "adaptive efficiency," which refers to the ability of institutions to innovate, continuously learn, and productively change. As markets fragment, technology accelerates, and competition comes from unexpected places, learning, creativity, and adaptation have become the principal sources of competitive advantage in many industries. Enabling constant innovation needs to become the goal of all organizations committed to prospering. Similarly, the goal for metropolitan areas must be to foster innovation and adaptation - in infrastructure, in institutions both public and private, and on the part of individuals. • These efforts need to be proactive and designed for the long term. Government, civic, and business leaders need to challenge all economic sectors and institutions, including their own institutions of government, to become cultures of innovation. The consequences for any community that does not respond to this challenge are low productivity, stagnant living standards, and reduced opportunity for its citizens. Innovation and change mean uncertainty and disruption. But it is becoming increasingly clear that dynamism is critical to growth. (You can't have upward mobility if no one is on the move.) The more churning in a community in terms of new business start-ups and existing business changes, the faster the community's rate of economic growth. In fact, of all of the indicators in this report, churn is the most strongly correlated with employment and income growth. This means that communities need to promote change and innovation, not retard it. • Strategic Plan for Economic Development Page 15 of 20 \\Metro-inet_us\ardenhills\Admin\Committees\Economic Development Commission\RH Strategic Plan-Final 5-16-07_doc A New Goal: Get Prosperous, Not Bigger • As communities achieve low levels of unemployment in an era of fairly strong economic growth, economic developers need to think more about quality than quantity; more about getting prosperous than simply getting bigger (e.g., more jobs and people). Most economies, both big and small, still see getting bigger as the main goal of economic development. In the last 20 years, the transitional period between the old and the new economy, "getting big" made some sense because economic growth was slow and unemployment high. However, even when local and regional economies were weak, job growth was at best a means to two possible ends: raising the average standard of living in the metropolitan area, or helping reduce poverty by employing those at the fringes of the labor market. The first of these two goals is now more effectively achieved by focusing on income growth per se and not job growth as a means, particularly with the unemployment rate at around 5 percent. The second is now largely a matter of structural or social reform, such as job training, K-12 improvement, and • solving the problem of spatial isolation in low-income, inner-city neighborhoods. It is difficult to see how programs aimed at undifferentiated job growtthat are not focused on higher wages hi7�, r-sil Jobs an sl- . provide more opportunities for the poor than already exist in most metro economies, unless those areas are losing jobs or have high unemployment. Unfortunately, in most places it is hard to reverse the "go for growth" political juggernaut that remains on autopilot. A powerful growth coalition exists in most metro areas (e.g., real estate developers, Chambers of Commerce, newspapers and utilities, and economic development professionals) that advocates getting bigger, even if the new jobs pay little and the region is coping with the pains of growth. For example, economic developers in Northern Virginia still aggressively recruit new firms, even though traffic congestion is the worst in the nation, housing prices among the highest, and unemployment among the lowest. • Strategic Plan for Economic Development Page 16 of 20 \\Metro-inetus\ardenhills\Admin\Committees\Economic Development Commission\AH Strategic Plan-Final 5-16-07.doc As a result, the new goal for economic development, particularly in fully developed areas, should be to raise average per capita incomes through higher-wage jobs, while working to reduce poverty and expand opportunity • for economically disadvantaged residents, all the while boosting the region's quality of life. This does not mean that communities should oppose growth and erect regulations limiting it; it does mean that most areas should not continue to pursue job creation for its own sake. This is not to say that the strategy should remain fixed. If, unlikely as it is, productivity growth rates slow significantly in the next decade and unemployment increases, the appropriate goals and strategies might change. But for now and the foreseeable future, economic strategy should focus on raising incomes rather than simply attracting jobs. Beliefs About Economic Development in the Old and New Economies . . . - . people IT tire . . Being a cheap place to do business was the Being a place rich in ideas and talent is • key. the key. Attracting companies was the key. Attracting educated people is a key. A high-quality physical environmer:t was a Physical and cultural arylenities are key in luxury stood in the way of attracting cost- attracting knowledge workers_ conscious businesses. Regions won because they held a fixed Regions prosper if organizations and competitive advantage in some resource or individuals have the ability to learn and skill- adapt. Economic development was government- Only bold partnerships among business, led. government, and nonprofit sector can bring about change. A New Means: Get Better, Not Cheaper A new goal requires new means. In the old economy, places sought to get big by "getting cheap." In the New Economy, the key to success is to "get better." Policy makers used to believe that a low-cost environment was the key to success and that making investments to create a high-quality physical • Strategic Plan for Economic Development Page 17 of 20 \\Metro-inet.us\ardenhills\Admin\Committees\Economic Development Commission\AH Strategic Plan-Final 5-16-07_doc environment just raised costs and drove away business. That's why communities focused on physical infrastructure, below market-rate financing • and tax holidays for big industrial and commercial projects, and marketing and incentives to attract industry. The result was often low-wage jobs and companies that were just as likely to leave after a decade for even cheaper pastures. In the New Economy, the path to raising wages and quality of life is in ensuring a technologically advanced infrastructure, boosting the skills of the region's workforce, creating fast and responsive government, ensuring a high quality of life - including a high-quality physical environment that is attractive to knowledge workers - and developing a responsive, efficient government. This is not to say that fiscal discipline should not be a cornerstone of government in the New Economy. But a low-cost environment with a poor quality of life is not the ticket to success. In the New Economy, communities need to shift their focus from providing tax breaks and other subsidies to investing in the skills of • the workforce, a vibrant infrastructure for technological innovation, and a superb quality of life. Rather than simply trying to cut costs or react to each new economic gyration, communities should instead invest in the foundation areas for growth in the New Economy. A progressive, innovation-oriented metropolitan area policy framework for the New Economy should rest on four cornerstones: 1. Building an Organization That Supports Economic Development 2. Creating a Community that Fosters Economic Activity 3. Retaining The Existing Business Base 4_ Attracting New Investment • Strategic Plan for Economic Development Page 18 of 20 \\Metro-inet.us\ardenhills\Admin\Committees\Economic Development Commission\AH Strategic Plan-Final 5-16-07.doc Appendix B: DeSCo's Philosophy of Strategic Planning DeSCo's philosophy on strategic planning for economic development mandates that every member of the community be afforded the opportunity to provide input and insight into the plan. We realize that not everyone will have an opinion nor wish to express it; however we find it important that every citizen in the community be afforded an opportunity to speak. In economic development, there are four layers of input solicited in the development of the strategic plan. They are: Leadership. We define two key components to comprise the leadership in the community; the elected officials on the City Council and the members of the EDC who are driving economic development efforts. • Power Base. In any community, there are people who hold power and influence. The goal of an economic development strategy is to • find out what these individuals are thinking. The power can be: o Elected power afforded to those in office. o Appointed power commonly received from elected officials. o Wealth achieved from success in business. o Knowledge from achieving expert status at something. o Positional power from holding a position of responsibility. We request the input from those who hold the power or influence in the community as we start our work in the community. Strategic Partners. These are individuals or organizations who work closely with City Hall and the EDC. They often involve Planning Commission and other City Committee members, the Chamber of Commerce, health care officials and others with similar interests. Citizen Tax Payers. These are foundation upon which everything in the community. We begin our engagement with one-on-one interviews with the leadership and power base in the community. Our questions to these individuals are purposely open ended, allowing DeSCo staff to collect the information • Strategic Plan for Economic Development Page 19 of 20 \\Metro-inet.us\ardenhiffs\Admin\Committees\Economic Development Commission\AH Strategic Plan-Final 5-16-07.doc necessary about what issues are faced in the community when it comes to economic development. We do not lead, we listen. • The answers to these questions are formed into a survey that is circulated at first to the strategic partners and then ultimately to the city as a whole. We contact both by directing their attention to the City's web page where the economic development survey is hosted. This works to establish the community as the leader in economic development as opposed to the consultant. By sequentially distributing the survey in this manner we are able to stratify the opinions of the community and show any separation in opinion between those "in the know" and the rest of the community at large. Citizen involvement in economic development strategy formation is essential for support and implementation of the plan. Elected officials, economic development staff and citizens all play important roles in governing the community. Therefore, DeSCo commits to promote and to sustain a responsive citizen involvement environment. With the opportunity to provide • input comes buy-in. With buy-in comes support and with support comes the ability of the EDC and the community to implement an effective economic development strategy. • Strategic Plan for Economic Development Page 20 of 20 \\Metro-inetus\ardenhills\Admin\Committees\Economic Development Commission\AH Strategic Plan-Final 5-16 07_doc � Council Work Session Agenda Item 28 June 18, 2007 � ATTACHMENT B • • CD 0 0 0 0 0 0 p O 0 0 a 0 0 O E O O O O O O O m 0 0 0 0 0 0 O CD 00o0000f- 000000 0 co000000 0cfl (» 000 O (n00000 O 000 (n a) O L!? M OD O to L6 Lf) Ln (fl N T r W OO Lo ca N — •- K3 t'- 60), 69 Efl va Ef3 ffl M O H 0 0 0 0 0 0 0 O 0 0 0 O 0 0 0 0 0 0 0 O O O O O N� O O O O O O O O O O O O r EH O O O O O O O Co O O O Co (O C O O C C C V C C -- N N M — OO O — LO N In N O Cl) (fl 69 OD — K3 (f3 EA Y> (fl LCA to co 6q �- 0 Co 0 0 O O O 0 0 0 O O O O O O O O 0 0 0 O T- O O O O O O Cl O O O O wV) 00 OO O OOO (O Co Cli C C O O C Vi C 0 'Il N O CO b — LO N to N O M 60 EF3 — 69 Ef3 W HO w (O w EA bq O O O O O O Co O O O O 0 0 0 0 O O O O O O O �+ O Cl O O O O O O O O O 69 O cl 0 0 C C O CLQ O C oc a 0 o _ _ N N EA V> E9 W V> 60 ua LO V EA Ef3 EA •�� (D O O O O O O O O Cl O O O O O O O O O Efl In O O O O O O Lo _ C O O O O Cl LO O �+ (n CV I- C7 O LCA N N T = W N (fj <- ff� Ef3 EA H3 UO • � (f-� ER (f3 O O O O O CD CD O O O O CD CD O U 69 o 0 0 Cl 0 0 0 Co c1 0 0 O O o O O O N N 69 O 613 fA ER E9 V) 0 69 d9 V � N � 0 E Q 0 Q 0 0 E H W Q) a) T _O O_ C6 E U) Q) O a) El o E d Q _ LU r Q a) a) w Co LLL a) � �c u> t V Od 06CD a) Q C N ul t n N O C c6 C a) O) _O EO > N E S O ti N O O C (D Q) _O C U) (n N C a) (6 rn m a) O M a) N Q O CC N ril D (6 Q C .- -0 c N o p a) >1_ n U) 0) w rn p c t a� v v p c 0 >, m u> u) a� o E Y p • 0 OE .0 O > m (B N N :-3 ca CU U) 3 c cE p o o ami is i o c p U) w C) wC) CU � (- c) ommT 'S W, t t • AHEDC's Mission • Ensure a sustainable,profitable,and competitive Economic Development economic climate in the City; I' • Identify and build local capacity to support economic development in ty, the Ci , Strategic Plan • Consider and evaluate outside capacity to enhance the economic development in the City; As recommended by the Arden Hills • Improve the economic security of Arden Hills'families Economic Development Commission • Enhance the City's Value of Conservation;and • Prepare Arden Hills'residents to be productive, June 18,2007posmve contributors,equipped with lite skills that are valued in the future. Cornerstones of Development 1. Building an Organization that Supports Economic Development �L 2. Creating a Community that Fosters Economic Goals and Objectives Activity 3. Retaining the Existing Business Base 4. Attracting New Investment Organizational Development Product 1.Community&Economic Development 7. Gateway Signage Director 8. Way-Finding Signage 2.Economic Development Support Staff 9. Central Business District 3.Council and Commission Development 10. Trails&Recreation Program 4.Strengthening of City Administrator's Position 11.Development Sites 5.Community Awareness 6.Redevelopment Director 1 • Priority Redevelopment Sites Priority Redevelopment Sites laws Red F-/Gray Fox Business Area Bingo Had St.Paul'VkLd Daft Budding Red Fox/Gray Fox Area Business Retention Business Attraction 12.Business Retention Program 16. Information Assembly and Readiness 13. Sign Committee 17. Network Development • 14.Business Issues on Community Web Page 18.Joint Marketing 15. Resource Database 19. Individual Marketing Proposed Budget 2008 Item 2008 Economo Devebpmenesbeb8le vrn .. CD Director Title Change -- ---- so 00 impkmemation Cost Eeti O,dget Economic Development Support Staff $26,000.00- a_n -io;z Council&Commission Deselopment $3,000-00 Community Awareness -- $0.001 E<on�<oeb oo 000—1 eo0000 .z s oe sae»o Col$zo 950 11 $12110« Redeselopment Staff $O 00'. ��M a�mm�s >oe,�oPmeM- s>o0000 S-0 ss Coo oo s>oo0 o0 saooex Gateway Signs $10,000.00; <e.: ,Coe oa: 000 s;ooc oe. Way-finding signs $7,000.00' on sea0000' _.. _ —w—oc..dbx oo _oxo ods s .000 -..,o ooc x'. Central Business District- $0.001 co0: s,000 oo ssoo 0c Business Retention Program $5,00000'. s�z a.;�i`�EoO,em soon o0 a�:0 00 as 000 oo_ as ooc oo ss000 oo'. Business Issues Web Page $O 00; aeso�<a oa�em:e Resource Database $0.00- ego<As>. e.7 aa ,s :00001 baWooa szsx1e-. .$Coin $aseo Cel Information Assembly&Readiness $5,000 OOj £E 000 Co $5 l 004 W $ .0'. -f ewsa� Entertainment Budget $0.00' <z 000 oc_ sz,o 00 sz 000 0e' .000 0c _sz50110 oeo x JointMarketing $2,000001 Totals $52,00000: 2 2009 2010 ...Item _.. 2009 - _.. _. .. ....._ 2010 CD D Economice t Ttle Ch ge $O 00 ... baxietiopment Support Staff $27,650.00 CD Dir for Title Change _ $0.00! .Council&Commission De..elopment $3,0000 Economic Development Support Staff $29.300.00i Community Awareness $0.00; Council&Commission De I pment $3,000001 Redevelopment Staff $000 Community Awareness $1_,000 00 Gateway Signs $10,000 001 Redevelopment Staff $O.00E Way-finding signs --- --- $1,000 00'. Gateway Signs.,,. _..._.. _,__.,., $10,000 00, Central Business District-- _- $O oo -Way-finding signs t $1,000 00: Business Retention Program $5,00000, Central Business District !w 00 Business Issues Web Page $0-001 Business Retention Program Resource Database $O 00; Business Issues Web Page $0,00 Information Assembly&Readiness $2,500 06 :Resource Database $0.00 Entertainment Budget --- -- $0 00 Information Assembly&-Readiness $2,500 00 ........ ._..._... Joint_Marketing ---- --- $2,000 00. Entertainment Budget ---- - $5,000 00- Joint Marketing S2,006.66, Totals $51.150 00 _...__ _._..._ ____. ......... Totals $58,800 00'. 2011 2012 Item ____. 2012 CD D ector Title Change $0,00 CDD for Title Change $O 00; Economic Devel p ent Support Staff $30,95000 Economic D.—I.pm.nt Support Staff $326 , 00 00,: Council&Commission Development $3,000,00 Coun I&Com_m on Devetopmant_ $3.00000 Community Aw ss a $1,000.00 C m ty A a Hess $1,000:6 • Redevelopment Staff .. _ $0.00 Rede I P t 51 ff 588,000 00 ate Signs $10,000 00 W y ew Y Signs $10,000 00; G -fidn g 1 sign. $ ,000 00( Way finding signs $1,000.00 C tr 1 B District $O 00' -Central Business District $000 :Business Retention Program $5,00000( Business Retention Program $5,000:100 Business Issues Web Page Business Issues Web Page $O 001 Resource Database $O 00-` Resource Database $0.00 Information Assembly&Readiness- $2,500 00, Information Assembly&Readiness $2,50000 Ent_enainment Budget . $5,000 00= Entertainment Budget- $5,000,00 Joint Marketing $2,00000 Joint Marketing ... $2,000 00 _ $15 00` Totals $60,450.00j ___. ......... Totals. .... Proposed Budget Summary Requested Council Action Economic Development SV-9w Pim .ImpNmentaVon cost EsBinamlBudgat E E Council adoption of the Arden Dills Strategic ebpmem s,ypwt Sian ° 530 E Dewwpment 5 ° £ Economic Development Plan °°° Council approval of the implementation budget m o, eo n�a�,o�:P,a„am °m> sol 0o :2Ez�1 s a1 E,5o000 • 3 AH Economic Development Commission • Bruce Kunkel,Chair Jim Paulet • Nancy Kneeland Ed Werner • Dale Beane Edward Von Holtum • Rob Davidson Karen Barton,Staff • Raymond McGraw Liaison • Chris Asbbach Mayor Harpstead, Council Liaison • • 4 Executive Summary • Arden Hills Economic Development Commission has a mission to provide vision and direction to the economic development efforts for the City of Arden Hills. In the context of this broad mission, the priorities for AHEDC are: 1. Ensure a sustainable, profitable, and competitive economic climate in the City; 2. Identify and build local capacity to support economic development in the City; 3. Consider and evaluate outside capacity to enhance the economic development in the City; 4. Improve the economic security of Arden Hills' families 5. Enhance the City's Value of Conservation; and 6. Prepare Arden Hills' residents to be productive, positive contributors, equipped with life skills that are valued in the future. To pursue these priorities, the EDC will follow a strategic plan through 2012 comprised of the 25 goals and objectives presented below. In addition, this strategic plan addresses organizational excellence—the alignment of every facet of the Arden Hills Economic Development Commission to support effective economic development delivery and execution in the City. The 25 goals identified in this plan are organized around four cornerstones for economic development: Building an Organization that Supports Economic Development Creating a Community that Fosters Economic Activity Retaining the Existing Business Base Attracting New Investment Approvals and Adoptions This plan was adopted by the Arden Hills Economic Development Commission at their regular meeting on August 16, 2006, Bruce Kunkel presiding. The plan was then forwarded to the Arden Hills City Council for review and approval. This plan was received by the Arden Hills City Council at their regular meeting on October 9, 2006, Mayor Beverly Aplikowski presiding: Strategic Plan for Economic Development Page 1 of 20 \\Metro-inet.us\ardenhills\Admin\Committees\Economic Development Commission\AH Strategic Plan-Final 5-16-07_doc Acknowledgements This Economic Development Strategic Plan is the result of the concerted . effort of the Economic Development Commission led by Bruce Kunkel. We are especially thankful to Bruce for his leadership in this effort as well as all he and his commission members do for the City of Arden Hills. Also serving on the Arden Hills EDC are: Chris Ashbach Dale Beane Robin Davidson Kevin Kelly Nancy Kneeland Ray McGraw James Paulet Edward Werner While the planning and preparation of this report was a coordinated effort in every sense, the following key staff member was responsible for individual components of the document: Karen Barton, Community Development Director Special thanks are also extended to the attendees at all of the one-on-one interviews and phone calls; strategic partners to the City; and members of the community at large who provided input via the survey process for their active contribution to this process. Strategic Plan for Economic Development Page 2 of 20 \\Metro-inet.us\ardenhills\Admin\Committees\Economic Development Commission\AH Strategic Plan-Final 5-16-07.doc ti Introduction Community and government leaders across the nation have come to realize their actions can change, alter, and direct the condition of their local economy. The economic quality of life of the residents and the success of businesses many times are directly influenced by the policies and leadership of those who create a climate conducive to economic growth. A strong economy provides benefits to all who experience it while a weak economy puts businesses and residents at risk to the economic effects of external forces. Change is bound to happen. The choice to be made is whether the change will be shaped by the community or by forces beyond its control. Economic development strategies are developed by communities who chose to shape their own future. In areas with strong economies, local governments do not struggle to fund essential services and are usually able to provide expanded programs • benefiting all that reside in the area. In such areas, schools are strong, streets safe and clean, park and recreation programs abundant, and the need to provide social welfare programs for impoverished citizens is reduced. Citizens living in an area with a strong economy enjoy consistent employment, regular wage gains, opportunities for personal advancement, and are able to reliably save for and invest in their future. Businesses are able to plan for consistent expansion, hire full-time employees for the long term, and are willing to risk significant capital, investing in their operations. Communities grow closer, tight-knit; as young men and women, after completing high school or college, remain in the area as growing employment opportunities in their "hometown" capture their interest. In areas with weak or declining economies, the opposite occurs. Local governments struggle to fund essential programs, with budgets under growing pressure to assist the impoverished. Residents have uncertain futures, filled with personal anxieties, with limited employment opportunities, stuck in subsistence level jobs. Businesses employ part-time workers and are Strategic Plan for Economic Development Page 3 of 20 \\Metro-inet.us\ardenhills\Admin\Committees\Economic Development Commission\AH Strategic Plan-Final 5-16-07.doc unwilling to risk significant capital because of an uncertain future. The best and brightest young men and women must move from the area to seek quality employment, which is not available in their hometown. • Nationally, there are more than 6,000 economic development organizations, Chambers of Commerce, and local, regional, and state government offices working in some fashion to improve the economy of their respective areas. Never in history has there been such an effort. Some organizations have large budgets, better community cooperation, and a stronger commitment from local government than others. These areas have the best chance to either maintain or improve the economic quality of life and standard of living of their citizens. Some areas, however, provide little or no attention to economic development programs. They do not fully understand the need to have a constant, aggressive economic development program just to maintain the existing condition. In these areas, typically, the local economy is in decline. Even though local community leaders cannot control the actions or policies of • the federal or state government, they indeed can establish policies and create local programs, which assist and foster economic growth. The premise, therefore, of this economic development strategy for Arden Hills is that an active participation in fostering the economic strength of the City is an essential and responsible action for the local unit of government. Strategic Plan for Economic Development Page 4 of 20 \\Metro-inet.us\ardenhills\Admin\Committees\Economic Development Commission\AH Strategic Plan-Final 5-16-07.doc Economic Development Plan for Arden Hills • The EDC represents the interests of Arden Hills' residents, but with special emphasis on the corporate residents that share and contribute to our community resources. The EDC members gather and consider business community input and recommend to the City Council actions that support those interests; monitors business activity; and collaborates with other city committees and commissions to ensure a positive environment for economic development. Finding itself at a crossroad for growth, the City of Arden Hills engaged the services of DeSCo in the summer of 2006 to create a strategic plan for the City. This plan of action was developed from an interactive process involving substantial community input. using DeSCo's proprietary methodology develop and experience of creating strategic plans for communities throughout the United States. The final stage of our engagement resulted in the development of this strategic plan. The plan is segmented to address the EDC Strategic Imperatives: ■ Build an Organization that will Support Economic Development ■ Attract and facilitate a Community that Fosters Investment Retain and grow The Existing Business Base in the City of Arden Hills, while at the same time tolerate churning in new business start-ups and existing businesses ■ Develop and maintain strong relationships between City leaders and the largest corporate, academic and non-profit residents, and ■ Create an environment attractive to educated, creative or talented individuals to provide a strong workforce for the City's businesses, with emphasis on quality more than quantity. Every economic development organization is pressed with deciding how many of these five cornerstones their budget and staffing will allow them to address. Once they determine which cornerstones they can approach they are then faced with determining the relative emphasis to be placed on each cornerstone. In the formulative stages of the organization, more work is Strategic Plan for Economic Development Page 5 of 20 \\Metro-inet.us\ardenhills\Admin\Committees\Economic Development Commission\AH Strategic Plan-Final 5-16-07.doc required in the first three cornerstones; Organization, Product and Business Retention & Expansion. More mature programs are able to shift resources toward the latter cornerstones; Workforce Development and Marketing. At its current level of funding the City of Arden Hills can only address three cornerstones well. Based upon the needs discovered during our strategy sessions we would recommend those to be the Product, Organization and Business Retention / Expansion. It is our recommendation that funding and staffing be secured over the next five years for full implementation of this plan. Assuming this to be an achievable objective, we have written a five year economic development strategy that addresses all five of the cornerstones. However, this program is heavily weighted toward the first three; organization, product and business retention and expansion. Organizational Development The first component essential to a successful economic development program is to ensure that the organizational capabilities are in place for ED to succeed. In order to accomplish that success, we recommend that Arden Hills address the following organizational issues: 1) Community and Economic Development Director. For economic development to succeed there needs to be someone in the community with these responsibilities. Currently, there is no one on City staff with the title of economic development director. Full time economic development staff is not warranted at this time. However, a minimum of part time attention to economic development is warranted. Our first recommendation is that the awareness of this priority be recognized through title change. We would recommend that the title and job description of the Community Development Director be changed to Economic and Community Development Director as soon as possible. 2) Support Staff for Economic Development The new Community and Economic Development Director cannot assume the additional responsibilities of their job without sufficient • capacity to manage that task. If the City adopts the recommendations of this plan, a full time economic development Strategic Plan for Economic Development Page 6 of 20 \\Metro-inet.us\ardenhills\Admin\Committees\Economic Development CommissionM Strategic Plan-Final 5-16-07.doc administrative assistant will be required. This position may be able to be supported from other capacities in the City's system in the early stages, but it cannot be sustained without permanent staffing added to support this goal. Moreover, should TCAAP mature as expected, a support person for economic development as well as a redevelopment director will become a necessity in order to channel the growth opportunities successfully. In the near term, this position needs to be put in place to assume the support responsibilities necessary for meeting this priority. 3) Council and Commission Development Arden Hills is at a crossroads in economic development. In order for the City Council to support the efforts of its staff, there needs to be a higher level of expertise of economic development issues among the elected officials and commission members. Toward this end, we would recommend up to six, three to four hour training sessions be held at City Hall at a frequency of one every other month. These sessions should be open to the public. Topics for discussion may include: ♦ Redevelopment of Existing Properties ♦ Main Street Revitalization The Link Between Education, Workforce and Economic Development ♦ Incentive Utilization for Competitive Economic Development • ♦ Economic Development Finance ♦ Leadership in economic development. Why everyone is a leader in Arden Hills. 4) Strengthening of City Administrator's Position Economic development in Arden Hills will succeed by maintaining and developing a qualified staff. This is facilitated when the City Administrator has full administrative responsibility of the City while the City Council bears the responsibility for policy and legislative roles. We would recommend that a consultant be employed to help develop the most effective roles and responsibilities for the City Administrator and Council in managing the city. 5) Community Awareness The third leg of the economic development is the community itself. If the citizens understand the vision for economic development they will be much more supportive of an economic development mission. Incorporating citizen support for economic development will require that they be informed of the economic development focus of Arden Hills. This will be accomplished by amending the Mayor's already well received newsletter to include a section on economic development 6) Redevelopment Director Strategic Plan for Economic Development Page 7 of 20 \\Metro-inet.us\ardenhillsWdmin\Committees\Economic Development Commission\AH Strategic Plan-Final 5-16-07.doc As a land locked community, Arden Hills is no longer able to stimulate economic growth through the annexation of additional space. The goal for the community now is to optimize the space available to them. Even as the TCAAP project is developed, the need to be more actively • involved in the redevelopment of Arden Hills is still present. This position would be strongly skilled in the ability to take existing properties and convert them to new investment and job creation opportunities. Product (The Community of Arden Hills) The next most important component of an economic development program is the product itself. In a similar fashion to a business taking their product to market, the community needs to look at itself as a product that is being bought, improved and resold over and over again. Enhancing the quality of the product works directly at improving the customer's satisfaction of the buying experience. Activities recommended for consideration in improving the product include: 7) Gateway Plan. Visitors to Arden Hills are often in the community before they realize • they are arrived. It is easy to move from a neighboring community without realizing that one has entered Arden Hills. The paths along which one moves into and out of a community are referred to as the gateways. Arden Hills would be well served by placing modern welcome signs at its gateway entrances greeting visitors and residents. 8) Way-Finding Signage Moving throughout the community can be made more effective through the addition of way finding signs. As their name implies, these signs help to direct travelers to specific destination points in the community such as city hall, parks, shopping districts, schools, etc. When incorporated into the design of the gateway signage, they add to the style of the community creating a greater sense of presence that someone has arrived in Arden Hills. We envision this in conjunction with development standards for the City as a whole. 9) Central Business District. The lack of a city center is a common challenge for modern • communities. Many of these communities developed similarly to Strategic Plan for Economic Development Page 8 of 20 \\Metro-inet.us\ardenhills\Admin\Committees\Economic Development Commission\AH Strategic Pian-Final 5-16-07.doc Arden Hills, as a suburb from a larger metropolitan center. Once critical mass was achieved, a community was formed by the first settlers. Since the "city" at that time was the larger metropolitan • downtown, the focus on creating a central business district did not exist. However, as the community grew the need for its own identity grew with it. As is frequently the case, the area for a city center was not zoned or planned in the process. Arden Hills has areas of higher retail and service concentration; however they were planned for vehicular transportation and have the look and feel of such a decision. A city center is typically more pedestrian oriented consisting of: a. Higher buildings b. Zero lot line development (front and side yards) c. Shared parking d. Parks (typically passive) e. Entertainment and dining venues f. Niche retail Areas like this do not currently exist in Arden Hills. This matter is further complicated by the fact that the 'historical" city center/main street which many have defined as the area of Lexington and CR E has been `abandoned" by the construction of the new City Hall along CR 96 . As city halls are traditionally located in the City Center, the • citizens in Arden Hills question where the true city center may be at this time. A master plan, zoning changes and development/redevelopment efforts designed to create a city center would benefit Arden Hills greatly. This center would be addressed through the way-finding signage presented elsewhere in this strategy and supported through various fairs and festivals held purposely in this area to help create greater awareness and presence for the city center in the community. The EDC views this initiative as a top priority. 10) Trails & Recreation Program Arden Hills is challenged by the presence of major segregating assets which are its highways and lakes. These bisect the community into small pockets allowing for separate and unique residential opportunities. However, this separation also increases the need for attention to be paid on linking the individual pieces together. Citizens in Arden Hills reflect their interest in a trails program as they often site the segmented nature of the community in discussions and surveys. The City's Parks, Trails, and Recreation Committee (PTRC) developed a • master plan in 2002 . This plan links the trail system into a unified network of pedestrian transportation throughout the community. Strategic Plan for Economic Development Page 9 of 20 \\Metro-inet.us\ardenhills\Admin\Committees\Economic Development Commission\AH Strategic Plan-Final 5-16-07.doc The EDC views this initiative as a top priority and fully supports the PTRC's Parks, Trails and Recreation Plan. 11) Development Sites. As a land locked community, Arden Hills is rapidly running out of developable sites for consideration. This shifts the community's priorities from a development to a redevelopment nature. Due to development pressures in and around the community, single site redevelopments can and will most often be handled by market forces. However, we may have some tracts of land that are under or non- performing and convert them to a higher and better use is what we are talking about here. Arden Hills is at a point where master planning entire neighborhoods, retail districts, business parks and yes, the city center needs to move onto the public agenda. Through this process, a more proactive vision for the city can be implemented. Accomplishing this vision will require the city's participation in the development process through financing, incenting and negotiating key partners to participate in the process. The EDC views this initiative as a top priority and further defines the following areas as key redevelopment sites: The Red Fox/Gray Fox business/industrial area, the former City Hall site on CR 96, the Lexington and CR E business area, and the Chesapeake property in the Gateway Business District. • Business Retention Business development represents some of the core activities of any economic development program. Over time, the importance of a successful retention and expansion program has risen over that of the traditional attraction efforts. The most effective economic development dollars are those spent working with existing businesses since most of the economic growth in a community is the result of established businesses. Here are some activities recommended for Arden Hills. 12) Business Retention Program. Recent research on economic development effectiveness conducted by numerous resources has consistently emphasized that a business retention program focused on the base (those businesses that bring money into the community) and the largest companies is the most successful economic development strategy a community can design • and implement. The center piece of this program is the business Strategic Plan for Economic Development Page 10 of 20 \\Metro-inet.us\ardenhills\Admin\Committees\Economic Development Commission\AH Strategic Plan-Final 5-16-07.doc leader meetings. These should be conducted annually and focused on removing the obstacles hampering business success. Based upon the input received in these meetings, a series of business services can be provided. Since they need to be directly responsive to the needs presented during the interviews we can only offer suggestions of programs that other communities have used successfully in the past. If the recommended staffing levels are added to the community, we see no reason why 30 to 40 visits per year cannot be conducted in the community. The EDC has initiated and will continue with a business outreach and retention program through quarterly events. 13) Sign Committee. It is unclear whether the city's sign ordinance is overly restrictive or if it is just perceived to be. However, enough businesses in town have the opinion that the sign code is too restrictive so it would be beneficial for Arden Hills to convene a committee to review this matter. These people would be instructed to review surrounding sign ordinances and standards set forth by the American Planning Association. The comments received by this committee can be developed into a recommendation for the EDC and ultimately Council to consider. Inclusion of the City Planner in this effort would be essential. The EDC is recommending the City review the number of complaints received regarding the restrictiveness of the sign code and revisit this in six to twelve months. 14) Business Issues on Community Web Page. Arden Hills' new web page will work to provide a new more progressive image for the community. This page can become a tool for business retention by creating a section directed toward existing business issues. By creating a business only section of the web page the importance of this component of the economy can be emphasized. Although the EDC recognizes the value in this initiative, we have determined this not to be a priority at this time. 15) Resource Database. City Hall can position itself as more supportive of business if it creates a resource directory of business support services available from the governmental as well as private sectors. This can be as simple as a • Word file that is periodically updated, printed and put on display in City Hall lobby to something as sophisticated as an online database accessible from the City's web page. Strategic Plan for Economic Development Page 11 of 20 \\Metro-inet.us\ardenhills\Admin\Committees\Economic Development Commission\AH Strategic Plan-Final 5-16-07.doc Although the EDC recognizes the value in this initiative, we have determined this to be a later priority. Business Retention activities are additive events, i.e., they do not terminate quickly. Later year implementation of these new priorities will see success when earlier efforts are sustained, perfected and streamlined. Business Attraction Business attraction focuses on identifying companies from outside the area and enticing them to expand or relocate into a community. The goal is simple and straightforward; to secure new jobs and investment that off sets business closures. It is glamorous work, frequently commanding the most recognition of economic development efforts in the media. However, it is extremely expensive and it offers relatively low return on the economic development dollar. Since Arden Hills has not spent a great deal of time in this area, is just now considering an attraction effort and has little budget allocated toward business attraction, we would recommend that you focus • more on response capacity than lead generation. With that in mind, here are some activities recommended for Arden Hills. 16) Information Assembly and Readiness. Having accurate and up to date information is critical for program success. There are two places where a community can obtain a competitive advantage in economic development; with the accuracy of their data and the speed of their responses. We would recommend that focusing on this capacity be a higher emphasis at this time as opposed to actively marketing the community. This information should be compiled and attractively packaged in a marketing folder that can be easily distributed. 17) Network Development. The development of a strong, strategic network is essential for the near term marketing success of Arden Hills. A substantial amount of lead generation occurs from the State Department of Commerce. Lesser amounts of leads are generated from the utility company and others come from the development community. These three sources should be the primary source of lead generation for the Arden Hills in the near future (1-3 years). Leveraging these sources can occur in Strategic Plan for Economic Development Page 12 of 20 \\Metro-inet.us\ardenhills\Admin\Committees\Economic Development Commission\AH Strategic Plan-Final 5-16-07.doc two ways. The simplest is introductory meetings conducted by the city's economic development staff with the leaders in those three sources listed previously. City staff should have an entertainment budget that allows them to take these people out for lunch or after business meetings as they develop relationships with these individuals. The EDC also recommends involving surrounding communities to lead an area-wide effort. 19) Joint Marketing. As the program matures, the City would be well served to partner with other surrounding cities in a joint marketing effort. This is a common strategy in economic development as companies who are focusing on an area are able to be approached earlier in the decision making process through group marketing than they can be with individual marketing. The sooner that the community can make an impression on a company, the higher their chances are of securing the new investment. The EDC also recommends reviewing and expanding joint marketing opportunities such as with the Twin Cities Chamber and Visit Minneapolis North, for example. 25) Individual Marketing. . On rare occasions the community may opt to pursue its individualized market efforts. As stated before, these are very expensive and frequently result in little or no return on investment. However, for highly targeted instance where a niche opportunity presents itself, the community would be well served to have the capacity to pursue specific prospects by having the appropriate funds budgeted. Although the EDC recognizes the value in this initiative, we have determined this not to be a priority at this time. • Strategic Plan for Economic Development Page 13 of 20 \\Metro-inet.us\ardenhills\Admin\Committees\Economic Development Commission\AH Strategic Plan-Final 5-16-07.doc Summary Thoughts A successful strategic plan is, by definition, a usable plan — one that directs the City's economic development activities as well as its long-range view, and that yields meaningful improvements in effectiveness, capacity and relevance. To put it simply, not every plan is a strategic plan. A strategic plan is a tool that provides guidance in fulfilling a mission with maximum efficiency and impact. If it is to be effective and useful, it should articulate specific goals and describe the action steps as we have in this document. As a rule, most strategic plans should be reviewed and revamped every three to five years. This plan is no exception. In its own right, this plan's primary goal is to energize the Arden Hills EDC and to chart a course of action for the organization. This strategic plan for Arden Hills has addressed the needs of the community in economic • development while taking strides to ensure that the common pitfalls for plan failure have been averted. As Arden Hills implements the plan in a logical, sequential manner, it will energize its economic development efforts, and with it the community as a whole. • Strategic Plan for Economic Development Page 14 of 20 \\Metro-inet.us\ardenhills\Admin\Committees\Economic Development Commission\AH Strategic Plan-Final 5-16-07.doc Appendix A: Economic Development Strategies in a New • Economy Times have changed, and with them so has the underlying economic structure in which we all live. This new economy requires smart thinking by our leadership facilitated by new ways of solving problems and collaborations with sometimes unexpected partners. In the new economy, the ticket to faster and broader income growth is innovation. This economy puts a premium on what the Nobel laureate in economics Douglas North calls "adaptive efficiency," which refers to the ability of institutions to innovate, continuously learn, and productively change. As markets fragment, technology accelerates, and competition comes from unexpected places, learning, creativity, and adaptation have become the principal sources of competitive advantage in many industries. Enabling constant innovation needs to become the goal of all organizations committed to prospering. Similarly, the goal for metropolitan areas must be to foster innovation and adaptation - in infrastructure, in institutions both public and private, and on • the part of individuals. These efforts need to be proactive and designed for the long term. Government, civic, and business leaders need to challenge all economic sectors and institutions, including their own institutions of government, to become cultures of innovation. The consequences for any community that does not respond to this challenge are low productivity, stagnant living standards, and reduced opportunity for its citizens. Innovation and change mean uncertainty and disruption. But it is becoming increasingly clear that dynamism is critical to growth. (You can't have upward mobility if no one is on the move.) The more churning in a community in terms of new business start-ups and existing business changes, the faster the community's rate of economic growth. In fact, of all of the indicators in this report, churn is the most strongly correlated with employment and income growth. This means that communities need to • promote change and innovation, not retard it. Strategic Plan for Economic Development Page 15 of 20 \\Metro-inet.us\ardenhills\Admin\Committees\Economic Development Commission\AH Strategic Plan-Final 5-16-07.doc A New Goal: Get Prosperous, Not Bigger As communities achieve low levels of unemployment in an era of fairly strong . economic growth, economic developers need to think more about quality than quantity; more about getting prosperous than simply getting bigger (e.g., more jobs and people). Most economies, both big and small, still see getting bigger as the main goal of economic development. In the last 20 years, the transitional period between the old and the new economy, "getting big" made some sense because economic growth was slow and unemployment high. However, even when local and regional economies were weak, job growth was at best a means to two possible ends: raising the average standard of living in the metropolitan area, or helping reduce poverty by employing those at the fringes of the labor market. The first of these two goals is now more effectively achieved by focusing on income growth per se and not job growth as a means, particularly with the unemployment rate at around 5 percent. The second is now largely a matter of structural or social reform, such as job training, K-12 improvement, and solving the problem of spatial isolation in low-income, inner-city • neighborhoods. It is difficult to see how programs aimed at undifferentiated job growth that are not focused on higher wages or higher-skill jobs can provide more opportunities for the poor than already exist in most metro economies, unless those areas are losing jobs or have high unemployment. Unfortunately, in most places it is hard to reverse the "go for growth" political juggernaut that remains on autopilot. A powerful growth coalition exists in most metro areas (e.g., real estate developers, Chambers of Commerce, newspapers and utilities, and economic development professionals) that advocates getting bigger, even if the new jobs pay little ,and the region is coping with the pains of growth. For example, economic developers in Northern Virginia still aggressively recruit new firms, even though traffic congestion is the worst in the nation, housing prices among the highest, and unemployment among the lowest. • Strategic Plan for Economic Development Page 16 of 20 \\Metro-inet.us\ardenhills\Admin\Committees\Economic Development Commission\HH Strategic Plan-Final 5-16-07.doc As a result, the new goal for economic development, particularly in fully developed areas, should be to raise average per capita incomes through higher-wage jobs, while working to reduce poverty and expand opportunity for economically disadvantaged residents, all the while boosting the region's quality of life. This does not mean that communities should oppose growth and erect regulations limiting it; it does mean that most areas should not continue to pursue job creation for its own sake. This is not to say that the strategy should remain fixed. If, unlikely as it is, productivity growth rates slow significantly in the next decade and unemployment increases, the appropriate goals and strategies might change. But for now and the foreseeable future, economic strategy should focus on raising incomes rather than simply attracting jobs. Beliefs About Economic Development in the Old and New Economies . - . . believe In the old . - . . thaLt: Being a cheap place to do business was the Being a place rich in ideas and talent is key. the key. Attracting companies was the key. Attracting educated people is a key. A high-quality physical environment was a Physical and cultural amenities are key in luxury stood in the way of attracting cost- attracting knowledge workers. conscious businesses. Regions won because they held a fixed Regions prosper if organizations and I competitive advantage in some resource or individuals have the ability to learn and skill. adapt. Economic development was government- Only bold partnerships among business, led. government, and nonprofit sector can bring about change. A New Means: Get Better, Not Cheaper A new goal requires new means. In the old economy, places sought to get • big by "getting cheap." In the New Economy, the key to success is to "get better." Policy makers used to believe that a low-cost environment was the Strategic Plan for Economic Development Page 17 of 20 \\Metro-inet.us\ardenhilis\Admin\Committees\Economic Development Commission\AH Strategic Plan-Final 5-16-07.doc key to success and that making investments to create a high-quality physical environment just raised costs and drove away business. That's why communities focused on physical infrastructure, below market-rate financing • and tax holidays for big industrial and commercial projects, and marketing and incentives to attract industry. The result was often low-wage jobs and companies that were just as likely to leave after a decade for even cheaper pastures. In the New Economy, the path to raising wages and quality of life is in ensuring a technologically advanced infrastructure, boosting the skills of the region's workforce, creating fast and responsive government, ensuring a high quality of life - including a high-quality physical environment that is attractive to knowledge workers - and developing a responsive, efficient government. This is not to say that fiscal discipline should not be a cornerstone of government in the New Economy. But a low-cost environment with a poor quality of life is not the ticket to success. In the New Economy, communities need to shift their focus from providing tax breaks and other subsidies to investing in the skills of • the workforce, a vibrant infrastructure for technological innovation, and a superb quality of life. Rather than simply trying to cut costs or react to each new economic gyration, communities should instead invest in the foundation areas for growth in the New Economy. A progressive, innovation-oriented metropolitan area policy framework for the New Economy should rest on�r cornerstones: 1. Building an Organization That Can Support Economic Development 2. Creating a Community that Fosters Investment 3. Retaining The Existing Business Base 4. Attracting New Investment rFft • Strategic Plan for Economic Development Page 18 of 20 \\Metro-inet.us\ardenhills\Admin\Committees\Economic Development Commission\AH Strategic Plan-Final 5-16-07.doc Appendix B: DeSCo's Philosophy of Strategic Planning DeSCo's philosophy on strategic planning for economic development mandates that every member of the community be afforded the opportunity to provide input and insight into the plan. We realize that not everyone will have an opinion nor wish to express it; however we find it important that every citizen in the community be afforded an opportunity to speak. In economic development, there are four layers of input solicited in the development of the strategic plan. They are: ♦ Leadership. We define two key components to comprise the leadership in the community; the elected officials on the City Council and the members of the EDC who are driving economic development efforts. ♦ Power Base. In any community, there are people who hold power and influence. The goal of an economic development strategy is to find out what these individuals are thinking. The power can be: o Elected power afforded to those in office. o Appointed power commonly received from elected officials. o Wealth achieved from success in business. o Knowledge from achieving expert status at something. o Positional power from holding a position of responsibility. We request the input from those who hold the power or influence in the community as we start our work in the community. Strategic Partners. These are individuals or organizations who work closely with City Hall and the EDC. They often involve Planning Commission and other City Committee members, the Chamber of Commerce, health care officials and others with similar interests. ♦ Citizen Tax Payers. These are foundation upon which everything in the community. We begin our engagement with one-on-one interviews with the leadership and power base in the community. Our questions to these individuals are purposely open ended, allowing DeSCo staff to collect the information Strategic Plan for Economic Development Page 19 of 20 \\Metro-inet.us\ardenhills\Admin\Committees\Economic Development Commission\AH Strategic Plan-Final 5-16-07.doc necessary about what issues are faced in the community when it comes to economic development. We do not lead, we listen. • The answers to these questions are formed into a survey that is circulated at first to the strategic partners and then ultimately to the city as a whole. We contact both by directing their attention to the City's web page where the economic development survey is hosted. This works to establish the community as the leader in economic development as opposed to the consultant. By sequentially distributing the survey in this manner we are able to stratify the opinions of the community and show any separation in opinion between those "in the know" and the rest of the community at large. Citizen involvement in economic development strategy formation is essential for support and implementation of the plan. Elected officials, economic development staff and citizens all play important roles in governing the community. Therefore, DeSCo commits to promote and to sustain a responsive citizen involvement environment. With the opportunity to provide input comes buy-in. With buy-in comes support and with support comes the ability of the EDC and the community to implement an effective economic development strategy. • Strategic Plan for Economic Development Page 20 of 20 \\Metro-inet.us\ardenhills\Admin\Committees\Economic Development Commission\AH Strategic Plan-Final 5-16-07.doc