Hey, hey, hey. It's 5:15. I will call the meeting to order. And do we need to do anything else? She's all set. So, uh, one of the things that I inadvertently did, we have >> this meeting is being transcribed and summarized. We we we have a a very good friend whose birthday is today and a month or so ago I said I will make dinner for you not realizing it was a port authority meeting and so I need to leave about 6:15 so that I can get home and fire up the grill and stuff but so Cynthia will be running it after that but also I would like to move an item around on the agenda item 3.1 which is second amendment to the master development contevelopment contract. I'd like to to bring up so we do that right after the approval of the minutes. So if that's okay with everybody, we will do that and and get that. We only have two items I think that we actually have to vote on which is the auditor's report and that. So, if that's okay, what I would then do uh is entertain a motion for the approval of the minutes from our last meeting. >> So, moved. >> Second. >> We motion made and seconded. Any further discussion or additions and corrections? Not all in favor, please signal by saying I. >> I opposed. Motion carries 50. Uh so, Holly or Kevin, are you gonna They can elucidate us. And I see we've got Kurt Hagen and Bill there sitting to answer questions or whatever. >> Yes. Uh, President Ericson and Port Authority Commissioners. So, I am here to present the second amendment of the 2016 master redevelopment contract for private redevelopment of land. And this is the contract that is the master contract over the use of tax increment financing on MOA property specifically. The contract itself outlines terms for how financial assistance from that resource would be provided for development projects. It also outlines um information about public investments with goals of supporting the long-term viability of Mall of America itself. as well as protecting the city and the public resources. So, this is the second amendment of this version of the contract and it recognizes pandemic impacts to the redevelopment of the property is outlined in the staff report. The contract language does provide for extensions under certain circumstances that are unavoidable delays and in this case those delays include epidemics, government actions and force closures. Uh the extension is contemplating the impact of those actions on the redevelopment activity on this site and did go before city council last night for approval. port staff and triple 5 uh negotiated the terms of this proposed extension. Um and that before you is a extension of two years to two performance thresholds. The first time frame is moving from a 10 to 12 year uh time frame for performance if approved here tonight. And then the second would be moving from 20 to 22 years. And within those time frames, there are also certain amounts of value of redevelopment activity that needs to happen. And this extension would modify those values slightly. So it would be a reduction from 500 million to 400 million at that first threshold, which is that 12 year now 12-year threshold and then increasing that second threshold by that hund00 million amount to rebalance it to 800 million from 700. And then the total value of activity for redevelopment that would be required by the contract remains the same at that $1.2 billion valuation. And um with that uh I would also just like to acknowledge that the port special counsel is on the phone virtually tonight in case there are any kind of contract legal questions. And then as president Eric stated or Ericson stated um Mr. for Curt Hagen and his council are here with Triple 5 Corporation. >> Okay, questions for >> Commissioner Nelson. >> Yeah, thank you, President. Um I don't have any questions. Just um as was alluded to, we looked at this last night as city council passed it unanimously. Um, I don't think there was a great discussion because it seems like a pretty straightforward issue to me that we just uh this is just an extension as we work together uh to get things done. I appreciate the work of staff uh to um work on the terms of this to protect the city and um it frankly like it seems like a pretty straightforward situation to me and and that's what kind of how the council saw it last night as well. So, um, appreciate the opportunity to speak. >> Commissioner LZ, >> um, I watched that last night and all due respect to Mr. Nelson, the spending of $180 million is not preuncter or straightforward. I don't think I don't think it ever has been. I started in 2018 on the first comeuppance of this. Uh, and I was open-minded over the years. That spread the skepticism, the doubt, and I' I've been in opposition for it the last two, three years. I don't see any reason to change that position. Uh, 160 million, I've got to believe, is going to be the largest expenditure of funds the city's ever made. Uh, I realize it's tiff funds. It's a different venue than the Bloomington Forward, but that was less than that. There was 39 million for the big, 22 for 9 mile. I don't know what the health and wellness center got, but it it wasn't pushing 100 million. So, I just don't think there's anything straightforward about this at all. Uh I think it's turned into a neverending project. I think it's got a fatigue factor to it. And the only thing that's unavoidable about it is not the pandemic. The unavoidable is Triple 5's inability to find private market capital either in debt or in equity to get this thing going under construction since 20 uh 2020 pandemic. Alian Field has been built. The six sick headquarters have been built and this is still mouldering along and I just don't know when it's going to end. Uh, another two years goes by and and and the the last time we saw this, the costs, my mind stuck somewhere about 350 million. I don't know what it's gone to now. And I can just see them coming back again, needing more money to finish this thing. We're burning up a third of the acreage in the land north of the Mall of America. And is that what we want? And we're burning it up on a waterbased tourist attraction that's a business. It's not real estate. So, I mean, my my problems with it and the faults I see just keep manifolding itself. It's an interimterm property. 35 maybe 50 years on it. You're dealing with water, buildings, and water don't ever agree with one another. And uh I'm just it's just one thing after another. Sustainability committee certainly has reservations about it. And they're only dealing with the power usage of it. they're not dealing with the water uh water issues on it. So, I don't know. I just uh I watched the council last night. Uh I timed it. I don't think it was five minutes and they just smoked right through it. So, uh I don't know. But uh I just uh I just don't think it's straightforward. I don't think it's peruncter. >> Other Commissioner Nelson. >> Yep. Thank you, President. and I appreciate your comments and I I I I actually don't disagree with you in terms of the overall project, but I don't think that's what's before us. Uh what is before us is not the project or any particular thing. It's an extension of the agreement and and that is in my mind something that is consistent with our other actions as I said last night and not in my mind very controversial that we would continue to work to develop that property as you have said and this is not the specific project that's not what we're voting on we're not voting on providing any type of money um and I will also note that the uh community health and wellness center is in excess of $100 million Um, so you know, this this we hope is a significant project. That's the goal. That's what we want. And so, you know, let's continue to allow our staff the time and the flexibility and the support to get it done. That that's what I would suggest that we do. >> Other commissioner comments, questions? If not, I would entertain a motion. It's on page 43 for this project. I'm happy to make the motion once I get to page 43. Um, I would move to approve a resolution approving an amendment to the 2016 master redevelopment contract for private redevelopment of land with MAC Land Holdings. Second >> motion made and seconded. Any further discussion? Not all in favor, please sign by saying I. I >> opposed. >> No. >> No. >> Motion carries. Uh four 442 against. Okay. Thank you. >> All right. >> Only begun. Good. >> So the next what we want to do then is move to item 2.1 the external auditor's report. >> Yes. Thank you President Ericson and commissioners. This is the external auditor's report on the port authorities 2025 year end financials. And we have Andy Herring here from Red Path who um is our auditor who will present his findings. And we also have Mary Kay Heinen the port's accountant if we have any questions to be answered. Andy is online so I will direct your attention to the monitors as he speaks to us. >> All right. Thank you. Good evening everybody. I'm just working on sharing the slides here. >> Welcome. >> Thank you. Thank you. Good evening. Well um thanks for allowing me to um do this virtually. It just cuts down on some travel time and we we don't have anything significant to discuss tonight in my opinion. >> Well, we we will be hopeful that when you the next comes up that you can give us a reduction in your cost of doing this because we're doing it this way. >> Sounds good. I will keep that in mind for the the next contract. Um, all right. So, the results of the audit, we wrapped up the audit um in early June. Um, I've issued or presented the results to the city council and now it's the port authorities turn. So, I will hop into my presentation. As part of the audit, we issued uh just a reminder. So we audit the the city, the port authority and the housing authority all at the same time. The financial statements of the three entities are issued in one document. So one audit opinion covers all three entities. Um and the reports that we issue are an opinion on the financial statements, a report on internal controls, a report on legal compliance, a report on federal compliance which is not applicable to the port authority and then a communication with governance letter. So the results a an unmodified opinion was issued. There were no internal control or legal compliance findings. one finding related to federal compliance and then just standard communications in the governance letter. So for the opinion on the financial statements that's the main audit report our responsibilities to determine that the financial statements are free from material misstatement and presented in accordance with GAP or generally accepted accounting principles. How do we do it? We verify the financial statements um or occurrence. Verifying the financial statements everything in them has occurred and pertains to the port authority. For example, cash and revenue. Um is it actually the port's cash actually the port's revenue? On the flip side, completeness. We're verifying that all liabilities and expenses for example are included in the financial statements. And then accuracy, cutoff classification, verifying amounts are reported in the correct account, in the correct fund, in the correct year, those sorts of things. The result, we issued a clean opinion or an unmodified opinion, and that's the highest level of opinion you can receive. And I'll just touch on a few overall general risks um that we identify really for all municipal audits for all governmental audits. Um these are not specific to the port authority. Um the a risk of the management override of controls exists. You know there's internal controls and policies in place but they must be followed in order for them to be effective. So we're looking at that. It's probably the most significant risk u just the risk relating to dispersements and how public funds are spent. So we're verifying the the expenditures of the port are appropriate. And then you hear a lot about fraud in the news. Um we're definitely looking for material fraud that might be uh present in the financial statements. Um there's I would say there's less susceptibility on the port side. It would really have to do with um expenditures uh cash than say a a private for-profit business that might also have inventory susceptible to theft for example. Um, you know, obviously you don't have that situation, but it's it's always something on our mind that we're testing for. And thankfully, we did not uh come across any instances of for sure instances of fraud or anything that we suspected there to be fraud or any suspicions or allegations of that kind. The next report, a report on internal controls over financial reporting. Um, so that's the policies and procedures and that also links back to my previous comments, a strong set of internal controls, also helps prevent fraud, reduces fraud risk. Um so examples of internal controls, approval over dispersements, approval over the monthly bank reconciliations, a proper segregation of duties so that no one person has any um no one person has too much authority in any certain area. And then on the back end, a review of financial statements on a monthly or quarterly or annual basis. the results. We did not note any findings related to internal controls. Next, the state auditor issues a a fairly lengthy guide that we complete as part of the audit for testing for compliance with state statutes. The seven sections in that guide are listed up on the screen. So, we're testing for compliance to make sure investments are allowable under state statutes. there's compliance relating to debt um mainly during the year that a bond would be issued. Um so that wouldn't that was not applicable in 2025. Um there's this contract or compliance requirements relating to dispersements tax increment. So a variety of areas there that we performed testing and did not note any um instances of non-compliance. There's also a a single audit that we performed relating to federal compliance and spending federal dollars. Um this is not applicable directly to the port, but there there was one finding that we noted uh relating to the section 8 housing choice vouchers program and uh maintaining accurate tenant files. Then the last letter or report is a communication to those charged with governance letters. So that would be a a letter to the what's the city council to the port authority uh board to the HA commissioners. Um and that's a letter of of mostly standard communications that are required to be made from the auditor to the board. um just highlights that there were no new accounting policies or anything significant in that area adopted in 2025. There is one more significant estimate um and that's just relating to the value of the land held for resale. I'm happy to report there were no disagreements encountered during the audit. In fact, everything like usual um staff were well prepared. Uh Mary Kay was available and ready to answer all of our questions and everything went smoothly with regard to the audit process and there were no corrected or uncorrected misstatements related to the port activity that we identified. >> So Andy, how did you or how does the city determine the value of the land held for resale? that that 17,150 that was the original cost. >> Okay. >> Um so that that number actually never increases on your financial statements, but if the if the overall value of the land decreased, then it should be written down. So that estimate is that you know if you sold that land to a third party, you'd be able to receive at least 17,150 Okay. Thank you. >> Yep. You're welcome. >> So, it's just original cost. All right. >> Correct. Correct. >> Um there's a slide here that highlights that for the 54th consecutive year, the city received the certificate of achievement for excellence in financial reporting. And that also includes the port's financial statements are covered under that award. Um, and this award is expected to be received again for the 2025 statements. Two more slides just summarizing the 2025 financial activity. I know we're probably at the point where we're looking forward to 27 already, but I'm looking back at 25 in the general and South Loop fund. Nothing all that significant to report. And really in the debt service fund either um the debt service fund balance is restricted for those 2015 tiff bonds and then the fund balance in the capital project funds or those are the tiff funds. Those are restricted for tax increment purposes. And then this last slide just highlights a few more things. a couple of the items I just mentioned. Um, those bonds are being paid at as scheduled at the end of 2025. About 4.4 million remained outstanding. Um, there was a $1.4 million increase in the amount of tax increment revenue that was collected in 25 compared to 24. Investment income was down about 600 700,000. Um, but that percentage decrease that's consistent with other entities as the as interest rates started to decline in 25 and I would expect that to be lower in 26, but nothing alarming there. That's just based on market rates. um major expenditures was um the the conclusion of the construction of the sick parking ramp and then overall fund balance increased around $11 million. Um big picture I I don't see any concerns um especially relating to the port and overall it was a smooth audit. I'd be happy to answer any questions. >> Commissioner questions or comments? Well, thank you, Andy. I guess if there's no questions or comments, on page nine of your package, there's a motion to accept the audit, which I would entertain. Mr. Peterson, I >> Thank you, Mr. President. I move that we accept the port authorities year end financial report for calendar year 2025. >> Second. >> Second. Motion made and seconded. Any further discussion? Not. All in favor, please by saying I. I >> I >> opposed. Motion carries 6. All right. Um, is it Barb Wolf up next? >> No. >> President Ericson and Commissioners, it will actually be Priscilla, our business assistance specialist. >> Welcome, Priscilla. >> Hello. Thank you. Good evening. >> Sounds good. I'll be presenting in the item 2.2. >> Priscilla, could you speak a little more directly into the microphone, please? >> Okay. Can you hear me better? >> Yes. Okay. Sweet. Okay. Start us off here first. It's a glitch. Okay. Good evening, President Ericson, port commissioners. I'm going to be pres presenting on the small business assistance grant program and just give you an update on that. I'm going to kick us off with some context. So, starting in December, there was um Operation Metro Surge, which I'm sure we're all familiar with, which caused a lot of disruption in our small business community. And so, in response to Operation Metro Surge, the P Authority had um approved up to $400,000 for a grant program. and then staff deployed this grant program um to provide funds to affected businesses. As a result of the crisis, the program sought to uh meet the following objectives. We wanted to make sure that we retained our small businesses that were impacted by this activities. We wanted to make sure that no jobs were being lost either because the business had to close due to also loss of income for the business. And then we also wanted to sustain the long-term viability of our business. So not just retaining them in the space that they were in, but also making sure that they could be sustained over this um period of crisis. Just a bit of a um some details for the program. I mentioned before we launched this February 24th with a public application and that application closed April 20th and then the full program closed sometime last month. In terms of all of the cleaning up of the program, the program also involved a lot of cross departmental cooperation. It was the port authority launching the program, leading implementation, but we also had six other divisions within the city that help with compliance review. We also contracted with Next Stage to provide underwriting services and support the distribution of the funds. And then the system is some information on how we went about implementing the um program. So we initially received 195 application from businesses across the city as well as outside the city actually um up until places like Lakeville. There are places people from around the state applied for the program. And then the Port Authority staff reviewed those 195 applications, screened them for basic eligibility, validity, completeness, what have you. And then we moved 121 unique businesses over to the six divisions. Um, and those divisions actually I wanted to mention who they were. So we had utility billing, finance, environmental health, the city clerk's office, building and inspection as well as assessing. And so they did some deep compliance review making sure that they were in complian with the city. And then 56 businesses were found to be in compliance. And then they were sent to next stage for additional review where they were checked for documented revenue loss. One of the criteria was to show 30% or more um decrease in revenue in a space of December to February. And then 25 businesses were approved and funded to the tune of 178,770 70 $787 um which is awarded either as grant assistance or mortgage assistance depending of if the business owned the property or releasing the property. And then this is just to show you a little bit of the demand. Like I mentioned, 195 applications um across the unique businesses that we scaled down to, we received close to a million dollars in requested um assistance. And then the businesses that we ultimately awarded requested close to $200,000 and we were able to fund 94% of that request. Um, and a big reason for the 6% unfunded requests was really because businesses were asking for above the $10,000 maximum that we had set. >> So, just wanted to show you some outcomes from the program. Starting with the economic impact, 25 businesses were funded. of those businesses that were funded, we were able to support and or preserve 173 local jobs, which again meets our objective that I mentioned earlier. We had close to 100,000 square foot of commercial space stabilized, meaning that businesses didn't have to lose their space. Um, and then of the space or the businesses that we did fund, 96% of those were commercial renters. So this was a really effective program in that regard. >> Yes. >> Mr. Lance, >> can I ask a question? Could you go back a screen? >> There's just a lag. Do you go >> uh one more back, I think. Yeah, one more back. Yeah. On the 25 business ultimately awarded, 190,000 requested, 178,000 deployed. Is that be was it's only 12,000 but I'm just how come it wasn't all deployed? >> So like I mentioned before the 6% that we couldn't deploy was because we had some businesses that two months of rent was above $10,000 and our max that we were given out was $10,000. So that's the only reason why we I shouldn't say only but a major reason why we couldn't fund all >> it's a timing issue >> kind of >> no it's just not me like their request exceeded what we were able to provide >> there was a limitation that was >> yes >> okay in place >> I just wonder >> yeah no >> good question >> thank you for the question and then just wanted to show you the geography of where we um awarded the funds So, we did see a lot of the impact in the eastern side of Bloomington um along Lindale for some, but then there was also pockets of specifically commercial nodes also um that were impacted and that we were able to fund. And then just some demographic information of the unique applications that we moved forward with. Close to 60% of those applications were from BIPOC owned businesses and the distribution is shown on the screen here. And then of the final um grants that we approved, 72% of the approved grants were of BIPOC owned businesses. And then additional demographic information. We collect that data of, you know, gender, age, um, business characteristics, and it's just showing some of that information up here. Just breaking out the text that's on the screen just to say that our eligibility criteria was very standard mix and it naturally selected for the people who were highly impacted by the metro search. So there was not a specific effort in a way to exclude anyone. It was the ma matrix was standard was core economic development matrix and naturally selected for the folks who are deeply impacted. Here are some challenges we encountered in the implementation of the grant. Um a lot of the businesses I mean you see the number from 121 down to 56. The reason uh for the drop in that number was because a lot of people did not have building permits or had not you know pulled a request for a building permit and so I had not paid their um sack which is a sewer availability charge. And then we also had some businesses specifically restaurants that had unresolved environmental health violations um and so that meant that they couldn't qualify for the grant. And then there were also businesses that had missing city business licenses and um outstanding utility balances which all meant that they were out of compliance um for the program. We started to take notice of this challenges really early in the program and so we took some steps to help mitigate that to ensure that we could um really help as much businesses qualify for the program. And so we had three business clinics in the month of March held in various locations across the city to provide an opportunity for people to come talk to staff um as well as a business adviser from Next Stage on how to apply for the program, qualify for the program as well as understand what are the requirements of the program. And then as an appa as part of the um efforts that we took we when sending out the um quote unquote I should say rejection notice we would list reasons why the businesses didn't qualify and gave them opportunity to rectify and so giving them an opportunity to comply uh with this we had many businesses which did resubmit an application or you know re-request for funds and of those businesses we had two businesses that successfully reapplied and were eventually awarded um funds. >> And then finally, ongoing and future efforts um as part of understanding this grant program and the implementation and the challenges we encounter um we are moving forward with information campaign to just um using the briefing as well as other digital um communication mediums that we have to inform people of the different ways to be compliant with the city in case of a future um grant program, loan program, financial assistant program, whatever that might be. Um, we're also going to be promoting the SAC um and small business credit and deferral program because this can sometimes pose as a challenge to businesses. The cost of one SAC credit um one SAC unit I should say is about 2500. I don't want to say the wrong amount. And then the city has its own SAC fee as well. And that's a lot of money for a business that's just starting out or expanding or what have you. So, we want to make sure that people are aware that the city provides um relief um for those expenses. And then this is just a final one, implementation of the city sack fee credit program which Barb will be talking about um soon up here. That's all for my presentation. Any questions? >> Commissioner Hunt, >> I didn't see and perhaps I missed it the types of businesses. I'm presuming a lot of restaurants, but did you have a graph with the types of businesses? No, but we do have the information on the types of businesses. So, we had from auto repair shops, restaurants, um it was a mix. We had some um health daycare kind of care type facilities involved. Um we also had maybe not so much food based businesses, but like small health like selling trash cans like I don't know at the mall like those kind of businesses. So, it was a variety. It was not predominantly restaurants >> and these were all businesses, current businesses. >> Yes. >> And then is there any followup planned with these businesses to see how they're doing in the future and that the money actually was beneficial and really helped them sustain versus, okay, we got it, but we're going to go out of business in five more months. >> Yes, great question. So, part of the application was they agreed to a follow-up survey in six months. And so, we will be asking questions of the businesses um in well, it's going to be it's going to be less than six months by now, but yes, we will be following up with them. >> Commissioner Santana, >> from the 195 applications to 25 that were granted, what was the most critical filter? Or was it those challenges you spoke of with like business licenses and unpaid utilities or was it kind of with the underwriters? >> It was really with the compliance. So a lot of we only sent 56 businesses to the underwriters and then they were they paired that 56 to 25. So it was really that unfortunately a lot of businesses had never pulled permits. And um this wasn't mentioned up there, but one of the things that we did as an opportunity to comply was we grandfathered some businesses in actually to help them being in compliant. And so the city had not always requested or required a permit of businesses. And so if a business had opened or started and had been in Bloomington in the same location before the city started requiring permits, we sort of like pulled them through because um they wouldn't have known and that's not, you know, we consider that that was not their fault or there was like a change in ownership. Like there was some um additional criteria that we expanded upon to allow folks move through. But then the businesses that then eventually moved through to next stage then didn't meet the additional eligibility requirements like not showing 30% or more in revenue loss. >> And those that were grandfathered in were the two that resubmitted and were successful? >> No, that's those were completely different actually from that. >> Thank you. >> Of course. >> Other questions, comments? Well, I I I I think there's a lot of things that you probably learn from this and and things that maybe we can do just in terms of relating to small businesses. I know I was talking with Barb a little bit before and she said, you know, it's been a real learning thing for the city and and I think to find we had that many that were really weren't in compliance for one reason or another and some of it they just don't know. But uh it's maybe something that we can do more in the future through the program. So thank you very much. It's uh interesting and and uh it met a need. It's just uh something obviously we hope in your follow-up survey that we can perhaps learn more about what we can do to maintain that because we I mean we would like to keep the businesses in operation and going if we can. >> Thank you, >> Commissioner P. you know, just to kind of follow up on what you were talking about around the compliance. Um, you know, it was it was interesting to see kind of how how many applications fell off. Um, and I was I was trying to think about is that a is that a bad thing or a good thing, you know, kind of the falloff. And one of the things that I think is kind of interesting about kind of setting a bar around that sort of compliance is that it in in kind of an indirect way, it sets a kind of business viability. It get it's a little bit of and it's not like targeted directly at that, but you'd think that the the more businesses that have problems on those dimensions like how like how viable that really is. And so I, you know, one of the things and it'd be useful to think about this as we're as we're going along more is does does having these sorts of kind of rules in place focus the money on the businesses that are kind of that that you could say in some way are better to put money into to kind of keep going in the long run. Um, and that's what I'm thinking about. I haven't really haven't really processed it completely, but I'm kind of that's that's what I'm thinking about with respect to this. So, >> well, I think perhaps when that survey comes back six months in and you it may be something that even would be good to since we have a cohort of people that have really been examined here, it might even be willing, you know, worthwhile to take and you have one in six months and then maybe follow through in a year or something >> just to see >> the the kinds of things. I mean, you know, we we've discovered in some of the other work we've done that that there are obstacles to people really getting started and wanting to do these things and and they they simply aren't aware of it. The complexity and and uh you know, if we want to do what we can to make Bloomington a good place to do business, these things all can can help. So, >> the caveat to that though, they're not startup businesses in this population. So that's different you when you think about longevity of a startup business is not real good odds but these are all businesses in for a certain time but still to monitor and see what's what we can learn from that. >> Good point. Good point. >> Excuse me, president and commissioners. If I can add a little bit of clarity to that. Uh when new businesses come to the city, if they don't interact with the city and don't necessarily need a building permit or a business license, they don't come to the city at all. So they may just open their business. And that's what happened in some of these cases is they never got a building permit and they never got a sack determination from the Metropolitan Council. So when we're working with other city departments and we're giving out money, uh we want to make sure that the businesses are in compliance. So that's the goal now is to get them in compliance so that when we have other financial opportunities, uh they're they're able to apply for those opportunities. >> Good. And there's also some duplicates in there and uh businesses that were from outside our our our community. >> One more question. Is that kind of the percentage because the the group that you use to do the the next stage see so many startup is that kind or not startup but businesses in need of assistance. Do they did they have a feel that that's a normal percentage that proceed from the initial app to their underwriting? Yes. >> Okay. >> I would think so with the ones that went over to them. >> Yeah. >> Thank you very much, Priscilla. >> Of course. Thank you. >> So, now we're gonna have Barb. >> Okay. And now we'll hear from Barb Wolf, assistant port authority administrator about with more detail about the SAC programs that Priscilla mentioned. Okay. So that's my introduction. So um to update you uh with existing sewer availability charge uh programs that we offer. So a little pro uh pro um background for this the pro both of the programs were designed by our community development racial equity action team. So each one of the departments at the city has embedded in them a racial equity action team. So years ago, as part of that, part of our cross department uh with staff, we developed both of these programs so that they could uh be deployed to our community to support businesses and have it be equitable across the entire community. So those were presented to the city council in early 2022 and approved at that time. Uh since then, um we also added an additional city sack fee which we established in early uh 2025. So that fee was uh brought forth uh because our our growing community and aging community were starting to develop vertically and so as we add additional units we need to grow the capacity of our sewer system and we also need to be able to update it. So uh the city implemented uh this fee to start building the reserves. Uh also in 2026 the city went to an organizationwide new policy format. So this is bringing both of these policies into that new format uh with a couple of updates. So what is a SAC? Uh that is a onetime fee determined by the metropolitan council which oversees the 7ount metro area. Um it is uh something that every new business and ex existing business that expands must uh have a determination by the Met Council. Sometimes a mech council might find uh zero that they need, but they're determining the water usage of that business. And so as it expands, will they add additional water usage to the sewer system? So there's two sack fees. As I mentioned, the Metropolitan Council charges theirs $2,485 per unit. When the city of Bloomington added their fee in 2025, they determined that at $2,26 per unit. Both of these fees can uh be changed on an annual basis although they've remained uh stable for uh well city of Bloomington both years 2025 and 2026 and the Met Council has remained stable for several years. So both of these fees are due at the time of building uh permit payment for a business applicant. So why do we provide these SAC programs? And Priscilla alluded to that a little bit. We want to provide financial assistance and um help with some of those startup costs when a new business comes into our community. Uh going through the permitting process, of course, the fees that are owed to the city, that's just one side of it. There's many fees to starting up a business. So, this reduces barriers to entry and expansion and also promoting local investment and supporting our business community. And here I want to give an example. If a business comes in now and the metropolitan council determines that they owe four sack units, you can see that's going to be nearly $10,000 for the mech council and $8,000 for the city, resulting in a fee of $18,000. I will tell you that most businesses when they come into the city have no idea what sack is, nor that they're going to owe these dollars when they come in. So, this is an extra added expense that they did not know of in their business plan. and getting to some of that prevention that we're doing is working with Next Stage who is our technical business adviser and making sure that businesses get introduced to um the city early on and also making re developing relationships with our property owners so that when they're working property management companies also that they're coming to the city first. Uh, Commissioner LS >> just I'm just wondering do they know what they're getting for that too or I mean they're coming into blind blind with that. Okay, now I'm paying this. What do I get for it? >> Yes. Well, it's explained um by several uh city staff. I've explained it numerous times and sometimes you just need to explain it in lay terms of what it is. But yes, we explain this to the customers. So that that's just explaining SAC. So a little bit on the deferral program. This is a five-year repayment term for businesses. Um it's at a low interest rate. This year it's at 2.27. That is determined by the Met Council based on their debt ratio. Um so this deferral program only applies for the Met Council fees that that a business that would own. So, at the time that we collect uh the SAC fees, we collect 20% down plus the first month's payment, uh the city collects those fees on behalf of the Met Council and then we pay them back to the Met Council on a monthly basis. Um this is available for businesses with a minimum of two and a maximum of 25 SAC units as a determination. And we secure this through a deferred payment agreement that is signed by the city, the business applicant, and the property owner if they're not the owner of the property. Um, and all of this is governed by a master agreement that's signed between the city of Bloomington and the Metropolitan Council. So, I just want to give you some examples. Um, we only have three of these in existence right now. So, again, we started the program in early 2022. It just happens that all these are for restaurants, which is uh very expensive to open a restaurant. So, you can see um in the examples here, the first one uh $10,000 instead of paying that at the time of permit pickup, uh they only had to to uh pay $2,100 and then they can make a low monthly payment of $140 for 5 years. So, this just shows you a little bit. Uh four unit sack units. Um the second one $15,000 and only paying 210 a month after that. And then we had one earlier this year for a restaurant that's opening again. Um you can see that the interest rate fluctuates slightly every year. Um but this and we work with our finance department to deploy this as well and providing an amortization schedule for the applicant and they make their payments directly to our finance department. Any additional questions on the SAC deferral program? >> Questions? Anybody? >> Keep on going, I guess. >> Okay, I'll move into the credit program. Um, this applies, our credit program applies to both the Metropolitan Council fees and the city of Bloomington SAC fees. Uh, this is available for businesses that have a SAC determination up to 10 units. And this program pretty much uh acts as a a grant to the business. So we we would just transfer over funds um that are that they owe in the system. So we would pay these fees upfront and if the business should close um the the money is not refunded to them. So we have two funding sources for this program. The building inspection sack credit fund. This is a fund that has been developed over decades um that we have collected money in. We also get a 1% discount on our fees to the Met Council every month that we get credited for at the end of the year. That's part of these fees, but they're also citywide credits on properties within Bloomington. Additionally, now we have the Port Authority SAC credit fund. So last year as in 2025 in November when the port board approved our 2026 budget, they approved $75,000 to help support the city's sack fee program. So the port authority can help pay for those fees for a business met council fees or city sack fees. Here's some examples since we've done this in 2022. Um remember now none of this included um the sack port fund. This is all through the building inspection funds. So in 2022, uh a community center that opened here that has been very successful. Uh 2023, two restaurants and a retail location. I do want to point out the the retail location there in 2023 with $2,500. This business was going to open already had clients lined up when when they found out that they needed uh to pay this sack. as a micro business, $2,500 that you're unexpected to pay um can be detrimental. So, this was uh she was very grateful for this for this um gift. Um 2024, I want to point out that we're also supporting our expanding businesses. So, two restaurants and a service uh location in addition to three additional businesses that opened. And then in 2025, another community center, a dance studio that's been in our community uh for nearly 14 years, uh moved locations, uh so we assisted with that, a restaurant expansion, and then two additional um uh businesses. And then earlier this year, um this one should open soon, uh but it moved a longtime restaurant moved from one location to another. So over these fourish plus years, uh we've deployed $293,000 through this program to help support our business community. And again, all this funding came from the building inspections uh fund up to this point. And so the new uh sackport fund will help with additional funding on the city sack fees. And that's all I have for this evening. This is allformational. So there's no motion this evening, but I'll take comments or questions. questions or comments? >> Mr. L is a community center. >> Uh the first one is the Zawati Center and the second one is the Bloomington adult daycare. >> Well, I think it's great that these businesses that are trying to expand on that, you know, we work work with them. I mean, it's a important thing to do. So, that's great. And thank you. Thank you. >> So, we have another one on credit policy or we've covered both of those. >> We have covered both. President Ericson. >> Oh my gosh. >> Yes. We're cruising right along. >> So, administer updates. >> Yes. I will try to do this quickly. Um, thank you very much, President and Commissioners. Firstly, I just wanted to >> what what we should do I you know is just formally say we're happy to have you back with us >> and we understand that your your addition to your family is probably time consuming but enjoyable and >> yes >> both true >> we're we're we're happy and I have I have to compliment Kevin I think you know he uh did I think a very good job of stepping in and and making things keep moving during your maternity leave. >> Well, thank you. And that was actually Thank you all. Um that was the first item on my updates was to thank um Kevin and Barb and Alejandra's not here and Maritt for >> We can't Yeah, we can't forget Barb either. >> No, the all four of them did quite a lot. Um especially Kevin, Barb, and Alejandra all took on pieces of my responsibilities to keep the port moving. and you didn't see it all, but running staff meetings, going to internal management meetings. So, I just wanted to thank them all on the record for all the work you did and continue to do as I phase back in. Thank you for keeping things running smoothly. I appreciate it and they do too, as you hear. Um, and also Mary Kay, who's amazing. I just have to thank Mary Kay whenever possible. That said, actually moving on to budget. We anticipate bringing the preliminary budget and levy to you for your um review in August and then we'll proceed through our season as we do we go to the port and then we go to city council with preliminary and then we come back to you with final and then go to city council with final and then file everything with the county. The city is now undergoing a two-year budget process. So you will be seeing numbers for 2027 and estimates for 2028. So that's just a little bit different than what has been done in the past. Um other announcements, we have had some ribbon cutings recently. Giardanos at Mall of America. Um if anyone made it to that, thank you for your attendance. Added 80 jobs. And then Chuck and Dons at Normanddale Village. Um we also wanted to make sure you took note that Hatch Bloomington transitioned to at Bloomington Loves Local for 2026. There was concern with Operation Metro Surge that allocating money to support new businesses rather than concentrating on supporting struggling businesses that were already here would be the wrong tone in the community in this year. And so the program has pivoted and they are instead awarding money to businesses that already exist in Bloomington. I think that was a great change and a very smart thing to do. Um, the port continues to have money pledged to that program, but the program continues to find outside sponsors to support it. Other updates, exciting ones, Seagate is considering an expansion here, but it's a competitive process. They are looking at two other locations. So, the state has put together a proposed package for them. And last night, they went to city council for their application to the Minnesota Investment Fund, which would help to potentially support an expansion here. And that is a second expansion. There was a recent one where there was already a buildout and they've just added the equipment and the people to do that work. And so now they're looking at an additional expansion after that. Um other development projects, Southtown we have heard will likely not pursue TIFF for phase one due to prevailing wage requirements um applying to the third party contracts. So the Dixs House of Sport will begin construction without a TIFF application, but we expect that there may be other TIF applications at a future date. We do still expect to see a phased project there, a much larger project. Um, and so a vision presentation is coming at a future meeting. The Adora Apartments is a 52 unit development. That one came through very quickly, so compliments to Kevin for rushing that through. Council approved application documents um already and then future actions will occur if funding is awarded. We also have Lindale Apartments that were not awarded a bond allocation this round and will need to apply again in fall or winter. will likely be competitive for bond allocation at that time. And then the water park, we started the meeting with a bit of MOA, but we continue to work with them all on items for the development agreement and they are continuing to engage with lenders to support the project. And then finally for the opportunity housing ordinance inclusionary zoning requirement for new developments which I you all have seen a few times come through. Staff are working through updates to the ordinance and we have a new housing development specialist supporting this program. Um Kenny Neee has moved on to a different position outside the city. So I believe you met Ryan at a previous meeting. And those are our updates. If you have any questions, I'll try to answer them or I will direct you to the proper staff person. questions for >> I have a question and maybe it's a bold point now but there was a little bit of discussion about what had gone through to the council on park and go and park and fly and you sent us some information right after that with a link to the council meeting which had been extended and I know Steve and I had both been on probably planning at different parts when those were approved so what's happened on that did it get approved by council or >> uh President Ericson and Commissioner Hunt. Um I may also rely on our council member there was also at that meeting. There was healthy discussion related to the approvals for park and go and park and fly. >> Was that the the June 18th meeting or the subsequent >> the last meeting? >> Yes. I'm I will admit I'm blanking on the date. It's kind of been a whirlwind. Uh but council ultimately did approve uh what was proposed by staff um and that was by our planning department. So uh I might actually rely on our um commissioner, Mr. Council Member Nelson to speak to that more fully as he was one of the individuals that was presented that item by our planning department. >> Yeah. So ultimately what was approved by the council was a update to the ordinance that requires this is just an approximation 25% of it to be developed by somewhere in the 2030 range. >> Yeah, something like that. And the rest of it uh it was granted uh permanent rights to um their surface parking. Um, so that >> no longer the temporary >> no longer >> no longer temporary >> for 30 years. >> Yeah, >> that's right. >> If you you can watch the meeting. So >> I did. >> Good. Good. >> The other one, but >> uh watch the last one. Um, yeah. So that that it was approved that that both of them uh basically 25% uh needs to get developed andor set aside for development. It was made clear during the conversation that they don't actually have to break ground in that time frame. They simply have to cease parking and set aside that area for development um uh within that time frame. So um I can share other thoughts offline but I think I shared enough thoughts already. just a just a comment on that is that I think the and having having been around kind of for many of the period although not when it was put in place you know you maybe the person maybe the person to your right is the person to look for look to for that um but I think the the kind of original sin on that is back back at that point in time not you know and then this is re this is trying to do something to rectify a situation that has a bunch of constraints >> and I I'm as as someone who uh happily kicked the football down the field a little bit and you know allowed allowed kind of things to kind of go along. I probably have some kind of involvement in that but I think the you know it's it's a situation where you know you look back in retrospect and you said that probably was not a good idea to approve in the first place. And as you recall that temporary was used quite a bit and also by some of the players that spoke in the meeting at different capacities of as we looked at different things at planning commission at that time and what was being portrayed to us or presented by some of the same players as temporary and you look and you say that's not a temporary structure but still there. >> Mr. lines. >> I just need to get educated. Uh on the two-year extension to the Mall of America, uh two years, is that tied to the state legislature passing the extension of the unprecedented use of TIFF funds by by cities? Are they do they coincide that the two-year does this two years coincide with those uh >> bills? bills that the state legislature approved last winter. >> Short answer is a little bit sort of. Um the two-year extension that we are asking for coincides with the two-year extension or the it was a two-year extension that we asked for at the legislature for the use of the spending plantif. So it was originally the deadline was the end of 2025 to start a project. It'll now be the end of 2027. It's a very astute question you're asking. And so yes, the amount of time that we asked for goes just a little bit over that that window of time. So it gives us the full amount of time to use the powers of the spending planiff. >> So that would go into 2028. >> Yes. But it is >> Ericson and Commissioner L >> late 2027. >> The extension would provide for a two-year extension to the July 19th, 2028 date. So effectively six months past that time frame that Miss Meek was speaking to. Um and part of the intention there is uh to allow for that two-year time frame and then also if the water park does move forward so that we're not having to do another modification again in the future for the same reason. >> The fatigue goes. >> Okay. Anything else? >> Yeah. Thank you. Uh Mr. President, um I just had one thing also with regards to the um parking facilities there. Um and I just want to apologize to my colleagues because it was not was not something that I thought of until after and um and and maybe Holly can help me with this in the future. I don't know why that didn't come through this as well given that it was in South Loop and how engaged the port has been in development in that area. um I in hindsight I should have made that request uh that that we got your opinions on it and and that was my bad and so I just want to take a moment to apologize to you for that. I mean it's it's been it's been done it it is what it is. Um but um you know that was such I mean it for 30 years or whatever the port has been that's been the focal point of development for the port and I know we changed that a few years back but um this group had always been engaged on those issues and and I don't know why that didn't happen and it was you know it it was remiss on me for missing that. So, um, if we can just if I can help and if you can help make sure we don't do that again, I'd appreciate it. >> It's not your responsibility, but that was my thought, too, as I looked at that the minute or the reviewed that council meeting that why why wasn't it justformational to us versus bringing it up? >> Okay. Anything else? We are adjourned. Okay. Oh, that's right.