Sept. 23 - DEED Awards Redevelopment Funding

ST. PAUL –  The Minnesota Department of Employment and Economic Development (DEED) has awarded $3.2 million in grants for six projects to help offset the costs of reclaiming and redeveloping blighted property. The cities of Canby, Duluth, Eagan, Minneapolis, North St. Paul, and Oakdale received the grants under DEED’s Redevelopment Grant Program.

“As the state’s economy continues to recover, Minnesota communities are moving ahead with plans to redevelop blighted areas for more productive use,” said DEED Commissioner Dan McElroy. “These six redevelopment grants will help Minnesota communities put land back on the property tax rolls, create about 218 full-time jobs and retain 175 jobs.”

McElroy said developers generally avoid projects in blighted areas because of the costs and complications associated with reclaiming previously developed land. Without the financial incentives offered through the Redevelopment Grant Program, new development on blighted sites would be unlikely to occur, he said.

The Redevelopment Grant Program helps cities, counties and other units of government pay for up to 50 percent of the cost of redeveloping blighted industrial, residential or commercial properties. The grants can be used to pay for land acquisition, demolition, infrastructure and other project-related improvements. Recipients must provide matching funds.

Since its inception in 1998, the Redevelopment Grant Program has awarded more than $55.5 million, funded 124 projects statewide and reclaimed 1,144 acres of blighted property. The program has created 10,255 new jobs, retained 8,580 existing jobs and generated $23.9 million in new tax revenue. The program has attracted over $2 billion in private investment and led to the creation of 2,972 units of market-rate housing and 1,276 units of affordable housing.

The following projects received funding in the latest round:

Redevelopment Grant Program Awards, August 2010

City of Canby, Block 1 – $120,000
The city of Canby is awarded $120,000 for infrastructure costs associated with redeveloping this 1.04-acre site. The site was formerly residential and will be redeveloped into 23,800 square feet of office space and parking. This project is expected to include $494,500 in private investment, create 15 new jobs, retain 27 jobs and increase the tax base by $10,402. Other sources of funding for this project include tax increment financing. 
Local contact: City of Canby, Bonnie Merritt, 507-223-7295

City of Duluth, Oneota - $664,780
The city of Duluth is awarded $664,780 for infrastructure costs associated with redeveloping this 8.7-acre site. The site is currently occupied by several commercial buildings and will be redeveloped into approximately 76,000 square feet of commercial space in three new buildings. This project is expected to create 60 new jobs, retain 48 jobs and increase the tax base by $120,504. The project will leverage $18,881,306 of private investment. Other sources of funding for this project include developer financing.
Local contact: City of Duluth, Heidi Timm-Bijold, 218-730-5324

City of Eagan, Cedar Grove Redevelopment – $559,986
The city of Eagan is awarded $559,986 for infrastructure costs associated with redeveloping this 32-acre site. The site was formerly a shopping mall and will be redeveloped into 250 apartment units, 150 senior housing units including some assisted living units, a hotel, and commercial space. This project is expected to include $72,000,000 in private investment, create 55 new jobs, retain 35 jobs, and increase the tax base by $993,196. Other sources of funding for this project include the city’s street fund.
Local contact: City of Eagan, Jon Hohenstein, 651-675-5653

City of Minneapolis, Seward Commons - $290,472
The city of Minneapolis is awarded $290,472 for infrastructure costs associated with redeveloping this 0.51-acre site. The site is part of the former Bystrom Brothers machine shop operation and is currently occupied by a surface parking lot. The site will be redeveloped with 40 units of supportive housing, an on-site wellness center and offices for Touchstone Mental Health. This project is expected to create 30 new jobs, retain 28 jobs and increase the tax base by $31,318. The project will leverage $8,200,000 of private investment. Other sources of funding for the project include the Mississippi Watershed Management Organization.
Local contact:  City of Minneapolis, Mark Garner, 612-673-5037

City of North St. Paul, Bus Garage Redevelopment - $245,000
The city of North St. Paul is awarded $245,000 for infrastructure costs associated with redeveloping this 3.47-acre site. The former bus garage site will be redeveloped into a 35,000 square foot high-tech manufacturing facility by Reflex Medical Molding Corp. This project is expected to create 8 new jobs, retain 12 jobs and increase the tax base by $50,500. This project will also leverage $1.1 million in private investment. Other sources of funding for this project include tax increment financing.
Local contact:  City of North St. Paul, Wally Wysopal, 651-747-2421

City of Oakdale, Oakdale Mall Redevelopment - $1,383,340
The city of Oakdale is awarded $1,383,340 for infrastructure costs associated with redeveloping this 17.89-acre site. The site is currently occupied by a vacant shopping mall and will be redeveloped into 125,000 square feet of commercial space and 275 housing units. This project is expected to create 50 new jobs, retain 25 jobs and increase the tax base by $345,981. The project will leverage $40,761,034 of private investment. Other sources of funds for this project include tax increment financing and developer assessments.
Local contact:  City of Oakdale, Logan Martin, 651-730-2721

Upon request, the information in this news release is available in an alternative format such as Braille, large print, audiotape or computer disk.

Minnesota Department of Employment and Economic Development
Communications Office
Phone 651/259-7161 or 1-800-657-3858 ∙ TTY 1-800-657-3973
www.PositivelyMinnesota.com