Mall development options explored
WORTHINGTON -- The Worthington city council voted Monday night to authorize city staff to prepare two versions of a development agreement for the former Northland Mall site.
WORTHINGTON - The Worthington city council voted Monday night to authorize city staff to prepare two versions of a development agreement for the former Northland Mall site.
Worthington City Administrator Steve Robinson explained that the two options will enable both the council and the developer - Brian Pellowski of PBK Investments - to later consider which option is the most beneficial for both taxpayers and the developer.
Option No. 1 would provide a general obligation bond for an amount supported by tax increments of the proposed development.
“If the city enters into a general obligation bond, the bond would be issued and then the city would be obligated to pay it regardless of the speed or the completion of the development,” Robinson said. “... The city would be obligated to pay the bond regardless of whether the revenue comes in to support it.”
Option No. 2 would provide a pay-as-you-go TIF (tax increment financing) bond up to approximately $10 million or for 20 years, whichever occurs first.
“On a pay-as-you-go, the city has little or no risk in that the developer does not receive payment for the same eligible costs until after the taxes have been collected by the new developed structures,” Robinson said.
Amy Ernst, serving as honorary council member, asked Robinson why there are differences in square footage between the Nobles County assessor’s evaluation and the developer’s site plan.
“We received the information that we passed onto the assessor that matches what the assessor has come back with on the preliminary evaluation,” Robinson said. “Subsequently, we received a site plan in which the building’s square footages did not match, and that has not been reconciled yet.”
Mayor Mike Kuhle said the discrepancy would be corrected before the city agreed to enter into any sort of agreement with Pellowski.
In other business, Sheila Smith, the executive director for Minnesota Citizens for the Arts, gave a presentation to the council about a recent study showing the impact that nonprofit arts has on its community.
She said southwest Minnesota benefits from more than $7 million in economic impact from nonprofit arts and culture.
Kuhle asked Smith if she had any recommendations for city investment in the arts.
“The most important thing is to keep the organizations you do have on their feet,” Smith said. “They have a history, they have good mailing lists, they are drawing people in already.
“Rather than starting something new, you could assist with marketing - particularly outside of town and across the (state) borders to bring more people into town and to spend money on buying their ticket, spending money at restaurants and other places in town is a very valuable way to go,” Smith added.
Council members also approved plans for street and storm sewer extensions on Bioscience Drive. The city will bid to find a company to do the construction. It is projected to cost approximately $660,000.