Discuss Potential Future Industrial Park Land

Periodically, the City Council directs Staff to develop an inventory of surplus City owned land.

The objective of developing an inventory of surplus City owned land is to identify properties that are underutilized; and unneeded for current or future City functions. Staff conducts this procedure as outlined in the attached policy for disposition of City owned land.

The City conducted a land inventory in 2011-2012.  In April, the EDA reviewed the 2011-2012 City Owned Land Inventory; at which time, Staff was directed to begin looking for sites that were available for a future industrial park.

Purpose of Case
The purpose of this case is to continue the May discussion of a future industrial park in the City of Ramsey.

At the May EDA meeting, Staff reviewed all potential industrial park sites in Ramsey (please see attached reference map).  Staff was directed by the EDA to further investigate all potential sites; with an emphasis on the following three sites:

(1) Pearson Properties Site (north of U.S. Highway 10, generally west of Armstrong Boulevard)
(2) Hageman Holdings Property (generally north of U.S. Highway 10, generally west of Armstrong Boulevard)
(6) Minnesota Pollution Control Agency (MPCA) Closed Landfill Property (north of Sunwood Drive between Sunfish Lake Boulevard and Bunker Lake Boulevard)

1. Al Person Property
Staff has worked with Pearson Properties, LLC regarding his potential industrial park site.  The primary contact for Pearson Properties, LLC is Mr. Al Pearson. Pearson Properties owns about ninety (90) acres of land located on the north side of Highway 10 near the new Bunker Lake Boulevard extension and Puma Street.  Pearson Properties is a willing seller; with an asking price of $65,000 per acre or $1.49 per square foot. 

Developing his property into an industrial park will require an infrastructure investment to extend sewer/water/road (preliminary estimation $780,000 for first project). The development as an industrial park will also require a Comprehensive Plan Amendment, followed by an official Zoning Amendment.  As it stands today, the Pearson Properties site has a few different zoning classifications: R-2 Residential (Medium Density), R-3 Residential (High Density), and B-2 Highway Business (retail).  Pearson Properties is in agreement he would be willing to support a Comprehensive Plan Amendment and Zoning Amendment on the property and actively market for an industrial park.

2. Hageman Holdings Property
Staff has contacted Hageman Holdings regarding their 171.65 acres of land west of Armstrong Boulevard.  The City did approve a Plat (ALPHA DEVELOPMENT) and site plan for a new campus for Legacy Christian Academy. Hageman Holdings has informed the City that it is no longer actively pursuing a campus for Legacy Christian Academy at this time, but still desires to develop a similar concept with a different user. Hageman Holdings is not willing to sell any of their property located on the north side of Bunker Lake Boulevard now, or in the near future (i.e. 2-4 years); as they still would like to see their site developed into a school campus on the site recently amended to Public/Quasi-Public and residential in the remaining areas, consistent with the current Zoning District.  Hageman Holdings is willing to consider development of their property located on the south side of Bunker Lake Boulevard, which is about 45.1 acres.  However, they will be 'selective' with the proposed users; as, they don't want to compromise the long term goal for their school campus to the north. This area south of Bunker Lake Boulevard is currently located in the B-2 Highway Business District, which allows for retail type uses. 

With that in mind, Hageman Holdings' property needs would need a Comprehensive Plan Amendment, followed by a Zoning Amendment to allow for an industrial park to the south of Bunker Lake Boulevard (45.1 acres).  Staff has an inquiry into their management team to indicate whether or not Hageman Holdings would support a Zoning and Comprehensive Plan Amendment.  It is estimated, a the City will receive a response no sooner that one (1) to two (2) months.  Additionally, it is Staff's estimation, Hageman Holdings will be conservative with their asking price, at least $87,120 per acre or $2.00 per square foot.  This property has partial, proper road and utilities in place today. The remaining lanes of the four (4) lane Bunker Lake Boulevard extension would need to be completed with any future development along the Bunker Lake Boulevard extension, consistent with the agreement for ALPHA DEVELOPMENT, the Plat approved for Hageman Holdings.

6. MPCA Landfill Property
The MPCA controls about 270 acres of State owned land which encompasses a closed landfill in Ramsey. The MPCA regulates the closed landfill in Ramsey through Closed Landfill Program (CLP); which was granted authority from the 1994 Minnesota Landfill Clean-up Act (LCA).

About sixty (60) acres of MPCA owned land is currently located in the E-1 Employment District on the north side of Sunwood Drive just east of Bunker Lake Boulevard. However, as part of the 2030 Comprehensive Plan Update, the MPCA requested an amendment to 'Closed Landfill' to remain consistent with the Closed Landfill Land Use Plan, citing State Statute as the proper authority. In addition, MPCA Staff has indicated that the E-1 Employment Zoning District is inconsistent with their current and future plans for the site. Today, utilities run past this site along with appropriate road capacity.

Staff contacted the MPCA regarding purchasing a portion/all of the sixty (60) acres of property currently located within the E-1 Employment District.  The MPCA showed strong initial opposition to allowing the land to be developed by the private sector (i.e. and industrial park) due to needs for managing risks associated with a closed landfill and for potential, future soil remediation.  In addition, a major factor in the limited use of this site is the State bonding dollars that were used to acquire the site for the Closed Landfill Program. These acquistion dollars restrict the use to public use. Furthermore, the MPCA has stated that public use shall be also limited in scope due to the sensitive nature of the Closed Landfill. However, the MPCA did show an appetite to allow for a City owned public works campus.  Staff is working with the MPCA now to provide a written response to confirm these assumption.  In any scenario, it is likely this process will take several months to unfold.

Regarding the remaining three sites (3, 4, 6), staff has the following comments to provide:

Preparation of this case is being handled as part of regular Staff duties.

Generally, direct Staff to:

1. Pursue the Pearson Properties Site (north) as the primary industrial park for Ramsey:
   1. Assist Pearson Properties with a Comprehensive Plan Amendment and Zoning Amendment; which may require the EDA to pay application fees.
   2. Develop feasibility study for full build out of park (projected revenues and expenditures)
   3. Upon completion & EDA confirmation
      1. Direct staff to pursue shovel ready certification
      2. Direct staff to develop a memorandum of understanding with AL Pearson regarding the development of his property into an industrial park
2. Continue to discuss acceptable land uses with the MPCA on the Closed Landfill property
   1. The likely scenario would include a public use, that would free up other industrial land in the existing industrial park
   2. This scenario would likely include a need to discuss reimbursement of soils for potential remediation purposes
3. Continue to pursue the Hageman Holdings property
4. When items B and C are executed, bring back follow up case to EDA for review.

NOTE: Staff estimates waiting for resolutions/responses to B/C could take two (2) to four (4) months.  When that timeline is coupled with the timeline required for a Comprehensive Plan and Zoning Amendment (2-3 months), it could be winter/spring before a property is ready to market. Staff believes waiting this long before making a decision will put the City at a competitive disadvantage for potential projects (from a economic development perspective).

Generally, direct Staff to:

1. Pursue the Pearson Properties Site (north) as the primary future industrial park for Ramsey:
   1. Assist Pearson Properties with a Comprehensive Plan Amendment and Zoning Amendment; which may require the EDA to pay application fees.
   2. Develop feasibility study for full build out of park (projected revenues and expenditures)
   3.  Upon completion & EDA confirmation
      1. Direct staff to pursue shovel ready certification
      2. Direct staff to develop a memorandum of understanding with AL Pearson regarding the development of his property into an industrial park
2. Continue to discuss acceptable land uses with the MPCA on the Closed Landfill property
   1. The likely scenario would include a public use, that would free up other industrial land in the existing industrial park (C) Continue to pursue the Hageman Holdings property
   2. This scenario would likely include a need to discuss reimbursement of soils for potential remediation purposes
3. Continue to pursue the Hageman Holdings property
4.  When items B and C are executed, bring back follow up case to EDA for review.