Port Authority approves $2.5M budget, small business partnership
The Bloomington Port Authority unanimously approved four major items on August 20, including a $2.5 million levy request for 2025 and a partnership with the Minnesota Small Business Development Center to provide free consulting services to local entrepreneurs.
All four votes passed 6-0 without dissent. The Port Authority's most significant action was approving a $2.5 million levy request for 2025, which represents 78% of the maximum allowable amount. The funds will build operating reserves and establish a Strategic Acquisitions Fund for future land purchases—a new direction for the Port Authority. The budget also supports expanded citywide economic development services, including the new small business partnership, facade improvement grants, and city marketing efforts.
The Port Authority formalized its partnership with the Minnesota Small Business Development Center (SPDC), a state agency that provides free consulting to entrepreneurs on business planning, financing, and disaster recovery. SPDC is offering a $60,000 grant that the city will match. Andy Donahue, the state director, highlighted the program's track record: in 2023 alone, SPDC helped entrepreneurs access $117 million in capital and supported 216 new businesses with a 95% client satisfaction rate. He emphasized that the partnership is "the first of its kind in Minnesota" at the city level. When commissioners asked about long-term success, SPDC representatives said they maintain a 75-80% business retention rate over five years and offer a "turnaround team" for struggling businesses.
The council also approved a $1.6 million contingency fund for the parking ramp project at Lyndale Lane and Winstead. The contingency represents 10% of subcontractor bids and was needed due to an administrative oversight—while a general $20 million budget had been discussed, no formal contingency had been formally approved. The contingency provides flexibility for unforeseen costs while keeping the project well under the overall budget.
These approvals represent the initial steps in the Port Authority's budget process. The levy request still requires approval from Hennepin County and will go through a six-part approval process. The Port Authority's mission has expanded beyond its original South Loop focus to include citywide business assistance and creative placemaking initiatives.
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Votes (4)
Approval of Partnership with Minnesota Small Business Development Center (SPDC) and Acceptance of Grant
Dissent: None
Moved by President Erickson [23:22] · Seconded by Mr. Keller [23:30]
Andy Donahue, State Director for Minnesota SPDC, presented an overview of SPDC's no-cost consulting services for entrepreneurs, covering business planning, financing, and disaster recovery. He detailed their statewide impact, including $117 million in capital accessed and 216 new businesses in 2023, with a 95% client satisfaction rate. The proposed pilot project with Bloomington Port Authority is a novel 'city-ish' partnership in Minnesota, aiming to expand services locally. SPDC offered a $60,000 grant, which the city would match. Concerns were raised about the long-term success rate of businesses, to which SPDC responded with an estimated 75-80% retention over five years and a 'turnaround team' for struggling businesses.
Parking Ramp Budget Contingency Approval
Dissent: None
Moved by Mr. Peterson [1:17:22] · Seconded by Unknown [1:17:28]
Holly introduced the item, explaining that a formal budget contingency for the parking ramp project was needed due to an administrative oversight. Luke clarified that while a general budget of 'up to $20 million' was considered, a specific contingency had not been formally approved. The request was for a 10% contingency on the total subcontractor bids ($16,389,332), amounting to approximately $1.6 million. This contingency would allow flexibility for project needs while committing to remain under the overall $20 million project budget, with any further contingency requests requiring additional approval.
Resolution Authorizing a Levy for the Year 2025
Dissent: None
Moved by Mr. Peterson [1:34:49] · Seconded by Unknown [1:35:02]
Holly explained that this is the initial step in a six-part process for budget approval, setting the maximum allowable levy amount for the Port Authority. The Port's mission has expanded citywide to include business assistance and creative placemaking. The proposed 2025 levy request of $2.5 million is primarily intended to build operating reserves and establish a Strategic Acquisitions Fund for future land purchases, a new strategic direction for the Port. This requested amount represents 78% of the maximum allowable levy of $3.2 million, providing flexibility for future economic development initiatives.
Port Authority's Preliminary 2025 Budget for the Port Authority Development and General Funds
Dissent: None
Moved by Mr. Peterson [1:35:32] · Seconded by Unknown [1:35:39]
Mary Kay Hanan detailed the preliminary 2025 budget, distinguishing between the General Fund (South Loop restricted, funded by HRA transfers, typically breaks even) and the Development Fund (citywide, funded by the property tax levy). The budget includes adjustments for creative placemaking staff salary allocations, shifting some expenses to 'material supplies and services'. The Development Fund projects a surplus of $672,000, designated for property acquisition and building financial reserves. These reserves are crucial for managing cash flow, as property tax revenue is collected seasonally, ensuring operational stability throughout the year and funding new initiatives like the SPDC partnership, facade grants, and city marketing.
Notable Quotes (8)
We are part of the the State of Minnesota Department of Employment Economic Development and we run nine regional centers across the state that help entrepreneurs start and grow their business through a partnership not only with the State of Minnesota but also with Small Business Administration from the US Federal Government.
The cool and neat thing about all of this is we have people come up to us to say how much does this cost? This is no cost for any entrepreneur.
This will be the first really city ish and SBC partnership Minnesota... This will be the first of its kind in Minnesota to be in crux within the City in the of Bloomington itself.
Our long term goal we actually we have about a 75 to 80% successful rate of retaining those businesses.
I think we all kind of thought the same thing was that at some point in the process the contingency had been taken care of and I think probably what happened is there was some general statements made about you know, maximize, you know, a budget of up to $20 million which to this point we've obviously stayed well under but there really isn't a formal contingency.
The significant change to help us fund reserves moving forward and also to seed a Strategic Acquisitions Fund which is a new step the Port would like to take to contemplate purchasing land in the future for redevelopment.
As we get more regular with our budgeting and get to know the programs that are available to us or which funds we want to build in the future. It is nice to have that flexibility that if the Small Business Development Center identifies Bloomington as an opportunity area we can supplement those funds and be ready to move.
Part of that is the property acquisition but then part of it is also just building reserve for the fund because since the revenue is only property tax that only comes in in July, June and July and then in December. So there's no revenue in the first six months of the year so there does need to be a reserve in the fund.
Ordinances & Resolutions (8)
Passed in October last year, acknowledging blighted buildings at Southtown.
City plan providing a framework for the Southtown redevelopment, emphasizing urbanization and streetscape improvements.
Financial tool being considered to support the Southtown redevelopment, with a three-year deadline for establishment.
Existing agreement for the grocery store space at Bloomington Central Station, creating difficulties for new tenants.
City priorities that the Port Authority's budget and plans connect with.
Identified Port expansion citywide as a goal in 2022.
Process undertaken by the Port Authority to guide future spending, to be completed September 2024.
Statutory basis for authorizing the Port Authority's levy.
Source document
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Other Topics from This Document
Southtown Redevelopment Update and Tax Increment Financing (TIF)
Bloomington Central Station Redevelopment Update
Parking Ramp Budget Contingency Approval
Port Authority Preliminary 2025 Budget and Levy Request
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