Council moves forward with economic impact study

Patrick Fisher, Staff Writer

The New Prague City Council moved forward with an economic impact study for the annexation of 75 acres that includes a site for a possible future Wal-Mart.

At its Monday, Dec. 17, meeting, the council approved a Request for Proposal (RFP) for the study and a letter to be sent out to the five property owners who filed for annexation. The letter addresses reimbursement of any fees to the city in conjunction with the annexation petition. Also to be included with the letter will be a preliminary development agreement.

New Prague City Planner Ken Ondich had worked on a draft for the RFP that was presented to the council. The RFP included 15 items the economic impact study would consider.

City Planner Renee Christianson and Ondich went over the 15 items with the council, which include:

• The types of jobs created

• The number of full-time (40 hours/week) and part-time (less than 40 hours/week) jobs created

• The amount of local labor in the construction of the project

• The geographical market of the business to be conducted

• Any plans for phased construction

• Whether an over-supply of retail space in the city will be created

• The impact on commercial vacancy rates in the city

• The impact on the diversity of the city's economic base by projected elimination of smaller businesses

• The projected costs arising from increased demand for and required improvements to public services and infrastructure

• Projected tax revenues to the city

• Projected impact on land values (both residential and commercial) and potential loss or increase in tax revenues to the city as a result thereof

• An estimation of the revenue to be generated that will be retained and re-directed back into the economy of the city compared to other chain stores and locally owned, independent retailers in the city

• The extent to which higher value development on the site will be precluded, if at all

• The projected life span of the building

• A summary of the written policies concerning the applicants charitable giving and volunteer participation in the community.

Mayor W.A. Bink Bender questioned the second and third items. He pointed out that Wal-Mart considers 38 hours full-time, so that part of the study could be skewed. On the third item on local labor, he asked councilmember Jim Kratochvil if he thought the point was valid. Kratochvil said it depended on what was classified as local or it could be regional. Ondich noted that it was hard to quantify on this issue.

The council decided to remove that item from the study.

The fifth item, plans for phased construction, addressed any future expansion of Wal-Mart.

Ondich had seen a similar study when a Super Target was proposed in Waconia. The study cost about $30,000 at the most, although there were three revisions to it, as the store made changes three times. He expected this study to likely cost under $20,000 and require a minimum of two months to complete.

Kratochvil asked if a traffic study was being done.

Christianson said the Minnesota Department of Transportation was already working on one in that area. Also, city staff will be working with the city's engineering firm Short Elliot Hendrickson, Inc. on a feasibility study concerning services to the property such as sanitary sewer, water, storm water and wastewater infrastructure.

2008 Levy

The council unanimously approved the 2008 net tax levy, although it has been slightly reduced.

The levy proposed at the Monday, Dec. 10, Truth-in-Taxation meeting was approximately $3.4 million; the final levy is about $3.3 million.

City Administrator Jerry Bohnsack said approximately $135,000 had been cut from next year's city budget.

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