Friday, November 7, 2014

Distortions and Fear-Mongering from the Chamber of Commerce

On November 5th, the Fort Road Community, that went thru a multi-year, thoughtful process to rezone the property formerly occupied by the Schmidt Brewery and an ethanol plant, appealed a split 9-8 decision of the Planning Commission to grant re-establishment of a nonconforming use as a warehouse to Premier Storage. The property was rezoned to TN3 in 2008, a zoning classification that allows mixed commercial, retail, and housing uses, but specifically prohibits warehouse and other industrial uses. The Schmidt property is also in the Great River Passage Plan that encourages better connections to the river and more green spaces that fit into the Mississippi River National Recreation plan, which also impacts properties along the river.

The community did a fantastic job of presenting the hard work they have done before and since 2008 to encourage density, transit-oriented development, and better use of high-valued land. The argument on the other side was that, since that building was built as a warehouse and used as a warehouse until 2009, they couldn't imagine any other use. It's lucky that we had Dominium who had a much more active imagination and they could imagine a brew house and a bottle house being a gorgeous home to 260 artists and their families, with about a dozen studios to help them create their art.

The City Council voted 7-0 in favor of the community and in favor of higher and best use of that land.

So imagine our surpise when we opened our e-mail and found this over-wrought and fear-mongering missive from the Chamber of Commerce, written by a former employee of the very expensive, and high powered law firm that the owner of Premier Storage hired to be his mouth pieces. Double click to open the photo and read their hyperbolic letter.

Friday, October 24, 2014

July--August 2014 Update

Jefferson Avenue bike boulevard and sidewalks
Public Works completed the sidewalk on the south side of Jefferson, streetlights on that street segment, and the rest of the Jefferson Avenue bike boulevard construction to make Jefferson truly work for the West End population from age 8 to age 80. Thanks much to Mike Weber for the photos, and for his advocacy for pedestrian safety.

Al Carlson retired from PED
Al Carlson retired from PED. Al has been a great partner in all the housing and mixed-use commercial development we have seen in Ward 2 in the past 20+ years. Al was always patient with Dave’s moods and always worked very hard behind the scenes to find creative funding sources for a great project. Al also never hesitated to tell Dave that a pet project was just a non-starter. He will be greatly missed in Ward 2.

Pedro Park sign went missing
James LaFaye called to let us know that the sign in Pedro Park (with the names of the Councilmembers) is missing. Pat sent an e-mail to Parks & Rec Director Mike Hahm asking him when the sign will be put back up. Photo is from “unveiling” day in 2011.

Neighborhood STAR
On July 9th the City Council approved allocation of Neighborhood STAR grant and loan financing as approved by the citizen STAR Board. Ward 2 businesses receiving STAR funding included: (a) Insty Prints relocation to 1396 West 7th St., (b) Bad Weather Brewery’s renovations to 414 West 7th St. (the old NW Tire Building), (c) Whebbe’s Rare Books at 111 East Annapolis, (d) La Clinica’s new heating and ventilating system at 153 Cesar Chavez, (e) BC Commercial Properties at 1044 West 7th St., (f) Common Bond Communities for ADA entrances and restrooms plus better exterior lighting at their headquarters at 1080 Montreal, and (g) NeDA for about 10% of the required funding to construct a new 2-story commercial building at 430 South Robert St. The STAR Board also recommended and the City Council passed $250,000 in funding for Neighborhood Energy Connection to provide low-interest loans to homeowners for energy efficient home improvements, such as a new furnace or water heater.

New Gilbert DeLaO ballfields at El Rio Rec Center
Thune participated in the first baseball pitch at the new Gilbert DeLaO ballfields at El Rio Rec Center on the West Side. Pat had another appointment, so there shall be no photos of this historic event.

Over-serving of liquor and police reports
A Summit Hill neighbor called about over-service at a bar close to her home near Avon Street. One evening she and her husband awoke to some drunk young man sleeping naked on their couch. They called the police, who arrested him and removed him from their home. The next day she contacted the police officer who responded to find out where that young man had been over-served alcohol and the police officer told her that they did not ask that question. Thune spoke to the head of our Department of Safety & Inspections (DSI) about this on-going issue with the police not asking where a publicly intoxicated person had been over-served before his/her arrest. Thune was assured that DSI would request the police to ask this question when they pick up someone for public intoxication or DWI. We are hoping for the best, knowing full well that this has been a long-standing intractable issue.

Tour of's offices in Saint Paul
Dave was given a tour of’s offices in Saint Paul by its dynamic CEO Scott Burns. Their current location is their third in downtown; they had to move from the other two because of rapid growth. Good problem to have. Dave was very impressed with the company and their philosophy. Dave was running a few high-tech ideas past Scott on the white board. That’s our story and we’re sticking with it.

Summit Hill developer sand and silt tiring neighbors
Two Summit Hill neighbors called about the dirt and sand run-off from construction projects at 712 and 718 Fairmount all summer long. DSI has been out there several times and given the contractor tickets for not controlling rain water run-off on his construction site, which is against Minnesota State law. The contractor accepts the fines as a cost of doing business, and has never achieved compliance with the law. In the meantime, these two public service oriented neighbors have been out after every rain fall (and do you remember how many of them there were in the early part of the summer) shoveling up the dirt and sand and hauling to back up the street into the yards at 712 and 718 from whence it came. They not only did this on the sidewalks in front of their own homes, but also in front of the homes of two elderly couples who are not strong enough to do it themselves, and in the street further down the hill. They were tired and were requesting the City to take legal action.

Stone Saloon and historic use variance ordinance
Dave met with Tom Schroeder and John Yust about the wonderful renovation they are doing of the Civil War era stone saloon on North Smith. They are interested in an ordinance change to allow any structure with local historic designation to restore its original use without regard to the current zoning classification of the property. If you are interested in speaking up about this idea, please contact the Ward 2 office at 266-8621. We will put you on the notification list for future actions.

Zoning code required fence becomes elusive
Dave met with City staff from DSI and the City Attorney’s office about the fence that is required by the City’s zoning ordinances between the parking lot on West 7th Street and the residence at 311 Walnut.

More lights on Wall between 6th & 7th Streets
Pat called the City’s finance office to ask where the City gets the funding for bent straw lights. The answer: from CIB. This is related to the request for more lighting on a very dark Wall between 6th & 7th Streets. PW said that the owners would have to pay for the above-standard globe lights, but the City would put in whatever bent straw lights would cost (which works out to about 1/3 of the cost). Good item to add to the CIB list being requested of all the district councils.

House Detective produced study of historic uses of 7 Corners Hardware site
Dave met with Jim Sazevich, the House Detective, who had just completed a study of all the historic uses of the 7 Corners Hardware block, including an analysis of which uses may have involved hazardous materials so the City could apply for a DEED clean-up grant. Under contract with Greening the Avenue, Jim produced a large binder going all the way back to earliest settlement of West 7th Street. And he did discover that there were a couple of historic uses that would qualify the project for a hazardous material clean-up grant. Later Thune attended a Fort Road Federation meeting at Fire Station #1 at which the Opus Group presented the design concept for their development at 7 Corners Hardware site. They have also purchased the church next door, so the development will be slightly larger than originally anticipated.

Jim Miller, new Chair of the CapitolRiver Council
Dave met with Jim Miller, newly elected Chair of the CapitolRiver Council, for lunch. They caught up on downtown issues they are both working on. Thune also attended a Wabasha Street Block Party downtown. He sent a note to the team of downtown boosters who sponsored the party. He said, “I have never seen so much life on Wabasha!”

National Night Out on Stryker and Elizabeth
Gilbert DeLaO and the Central Block Club organized a large community gathering and pot luck at the corner of Stryker and Elizabeth for National Night Out. This is the first of several public events planned to “take back the corner” now that the Stryker Market has been closed by the State Department of Health. Thanks to everyone who was involved, especially Gilbert, Duffy, and the SPPD. This is a beautiful response to a persistent neighborhood problem.

Ordway's McKnight Theatre expansion
On August 6th, the City Council approved acceptance of a $4 million grant from the State of Minnesota to complete construction on the Ordway Theatre’s expansion of their McKnight Theatre stage. The Council also approved Bedlam Theatre’s sidewalk cafĂ© license.

Jefferson Avenue bike boulevard and Palace Rec Center
On August 13th the City Council approved additional funding for inflation-related cost over-runs on two bike lane projects on city streets (one of them being Jefferson Avenue), and also formally authorized Public Works to enter into community garden agreements with nonprofit groups. The Ward 2 office received a number of calls and e-mails about a newspaper report that funding had been taken away from Palace Rec Center’s expansion and upgrade. Thune’s complete answer is on this blog. The short response is that $91,000 was taken away from the 2014 budget, and the Mayor’s 2015 budget adds back $92,000. No net loss of funding for Palace.

Pat went on vacation
Pat went on vacation with her family, and sent a postcard. This is why there are no photos from the last few days of July and the first part of August.

Black Hawk helicopters flying low and dark
The Ward 2 office received a large volume of phone calls, e-mails, Facebook messages and Tweets about the military Blackhawk helicopters that were flying fast, low, and without lights in downtown Saint Paul and the West End one evening in mid-August. Most of them were commenting that they considered it dangerous to conduct military exercises in a densely populated area with no advance warning and with a population that would not know what to do if there were a crash or some other emergency. Again, Dave Thune hit the blog with his response.

Lowertown arts community space in the LRT train shed???
Brendan Kramp, Lowertown artist, updated us on the feasibility study the Saint Paul Art Collective is doing looking at a Lowertown arts community space in the train shed. He said ArtSpace is doing a study of what uses to put the space, but not looking at financial feasibility. Brendan will have a second phase conducted by another consultant to work out financial feasibility numbers and figure out how to pay for long-term operating costs. Much thanks to Patrick McCutchan, another Lowertown artist, for getting this whole ball rolling.

Sales of single cigars banned
On August 27th the City Council passed a ban on selling single cigars that cost less than $2. Cheap cigars must now be sold in packs of 5; the same as cigarettes. This ordinance was brought forward by a dedicated group of young people who noticed that fruit flavored single cigars are marketed to appeal to young people at the same time they are trying to educate young people not to start smoking. The ban passed 5-1.

Black Bear Crossing lawsuit settlement
Also on August 27th the City Council approved an out-of-court settlement with Black Bear Crossing for the early cancellation of its contract to operate at Como Park Pavilion. This followed a Ramsey County judge’s ruling that the cancellation was not properly done within the terms of our contract, and prior to the scheduled penalty phase of the trial originally set for January.

Wednesday, October 22, 2014

What is the 8-80 Vitality Fund?

City Council Action: Today the Saint Paul City Council today passed a plan to issue $40 million in bonds to capitalize an 8-80 Vitality Fund. So, what is an 8-80 Vitality Fund?

The 8-80 Vitality Fund is designed to promote economic development by increasing activity and vitality on our streets and in our public spaces for all ages from 8 to 80. Cities need to be interesting, vital places that attract people. The 8-80 Vitality Fund, inspired by the work of 8-80 Cities, includes projects that will attract millennials downtown at night, families to great neighborhoods with world class trails and bike lanes, workers to downtown with an off-street bike loop, travelers to the city with a green "balcony" attached to the Union Depot train deck, and residents and visitors to restaurants and entertainment venues.

Ward 2 Projects:
While there are many items in the 8-80 Vitality Fund for all the wards in the city (including completion of the long-planned Ground Round), we are most concerned about what great things will be happening in Ward 2.
  • Palace Theatre - $8 million
  • Central LRT Station Plaza - $1 million
  • River Balcony Phase 1 - $100,000
  • Jackson Street off-street bike loop segment downtown - $8 million
  • Downtown remaining bike loop design - $450,000
  • Saint Clair full reconstruction from Albert to West 7th Street - $2.5 million
  • Citywide optical fiber infrastructure - $1.8 million

Palace Theatre: Still palatial despite its time-roughened edges, the Palace constructed in 1916 hosted the likes of Charlie Chaplin and the Marx Brothers in its vaudeville days before being converted to the RKO Orpheum movie theater in 1947. After the movies stopped in 1982, it was used as a temporary home for “A Prairie Home Companion” through 1984 but has sat dormant since.
River Balcony: The Downtown edge includes areas for redevelopment along the bluff between Robert Street and Union Depot. A continuous River Balcony linking redevelopment sites, including the Union Depot, will create a dramatic public riverfront edge that extends from Lowertown, through Kellogg Park, to the Science Museum. Along the downtown edge, the physical and visual connections to the river will be enhanced by public passageways through new buildings proposed along the bluffs. With panoramic views from a series of “outdoor rooms,” the River Balcony will be a great place to have lunch or to relax with friends.
Central LRT Station Plaza: The small triangle bounded by the Vertical Connection elevator, Minnesota Club, Cedar Street, and 5th Street will be turned into a vibrant plaza. The photo shows the location of the plaza. It is the green space right behind Councilmember Thune and in front of the LRT tracks.

Thursday, October 16, 2014

Opus Chosen as Tentative Developer for 7 Corners Gateway Site

From October 16, 2014 Pioneer Press (which is not always available electronically after a time any more):

The city of Saint Paul has selected the Opus Group to develop the Seven Corners Gateway site across the street from the Xcel Energy Center.

Minnetonka-based Opus' plan for the 2.4-acre site calls for a hotel, market-rate multi-family housing, retail and a public plaza. Opus submitted its proposal in partnership with Minneapolis-based Greco Real Estate.

"This is an exciting proposal from two well-respected developers that have produced high-quality, successful projects in the Greater MSP region and beyond," St. Paul Mayor Chris Coleman said in a prepared statement.

The Saint Paul Housing and Redevelopment Authority (HRA), which advertised the project in a Request for Qualifications, still must sign off on the plan. The HRA will take up naming Opus' as tentative developer of this site at its Oct. 22 meeting.

"Opus will be a great development partner and I look forward to future iterations of the plan that will give us that "Wow" factor we are hoping for at the entrance to and exit from downtown Saint Paul," said Dave Thune, Ward 2 City Councilmember and HRA Commissioner, in an unprepared statement.

Tuesday, October 7, 2014

Invitation and Havenbrook Homes in Ward 2

The September 24-30, 2014 City Pages newspaper carried an interesting article entitled "For $ale" about the new mega absentee landlord in Saint Paul called Invitation Homes. Invitation Homes is a division of the Wall Street firm Blackstone Group that entered the absentee landlord game two years ago when they purchased 45,000 homes nationwide in bulk for the purposes of renting them out. They have purchased 1,200 homes in the Twin Cities alone. A quick check of Saint Paul's property inquiry database shows they own 83 homes in the City of Saint Paul, 11 of them in Ward 2.

And since Blackstone Group is an investment firm, they have securitized this investment and sold rental income backed bonds to their investors. Last year Blackstone Group packaged up 3,000 of its rental homes, pooled them together, and sold them off as a $500 million "rental backed security." Sound familiar? And Moody's, Morningstar, and Kroll rating agencies gave these bonds a triple-A rating. Luckily Fitch and Standard & Poor's have both been more skittish about these untried bonds.

Another me-too company has sprung up recently in the Twin Cities rental marketplace, and now owns 62 rental properties in the City of Saint Paul, 8 of them in Ward 2, in fact all 8 of them on the West Side. Havenbrook Homes was founded by Wall Streeter Oliver Chang, the former head of housing strategy at Morgan Stanley. According to Bloomberg News (Wall Street Aristocracy, Aug 22, 2011), Fed Chairman Ben S. Bernanke lent banks and other investment companies as much as $1.2 trillion of public money, about the same amount U.S. homeowners owed on 6.5 million delinquent and foreclosed mortgages. The largest borrower, Morgan Stanley, got as much as $107.3 billion, while Citigroup took $99.5 billion, according to a Bloomberg News compilation of data obtained through Freedom of Information Act requests, months of litigation and an act of Congress.

Havenbrook's methodology is to make an offer on a home within hours of posting for sale, and then offering less than the asking price, but offering cash for the sale.

Despite the three ratings agencies' triple-A ratings of these rental-backed securities, the Federal Reserve weighed in with a caution: "Despite these benefits, the large-scale rental of single family homes is still a new business with a short track record and, thus, carries significant risks."

Robbie Feinberg, the author of the City Pages article, spoke to Mike Vraa from HOME Line, a tenant's rights group in Minneapolis. Vraa said that Invitation Homes loves fees for everything. They have a $100-a-day late fee, a $250 fee for another occupant, a $50 per day fee for a pet. According to Vraa, many of these fees are illegal in Minnesota, but the company is national and doesn't seem to know about Minnesota laws relating to tenant rights.

Of the 11 Invitation Homes located in Ward 2, nine of them are located on the West Side, one on the West End, and one in Summit Hill. All of Havenbrook's eight homes are located on the West Side. If you have a particular property, you are concerned about, you can call the Ward 2 office at 651-266-8621 to see if your problem property is owned by a national Wall Street backed group.

Friday, August 29, 2014

Palace Rec Center and the Jefferson Avenue Bike Boulevard

Councilmember Thune has been getting a lot of phone calls and e-mails about taking some money from the Palace Rec Center expansion and upgrade in order to complete the Jefferson Avenue Bike Boulevard. Let us provide a little background and some financial information on this subject. It can be hard sometimes to follow the bouncing ball in government finances.

The 2013 Capital Improvement Budget (CIB) that funded the Palace Rec Center expansion and upgrade was always $1.053 million short. It was always anticipated that an additional $1.053 million would have to be added in the 2015 budget, for completion of construction in 2016. Completion of the Jefferson Avenue bike boulevard had cost increases because of difficulties getting the project approved in the Highland Park section of the trail. The Jefferson Avenue bike boulevard took away $91,000 from the 2013 budget for Palace Rec Center. That means that the 2015 budget for that project will have to be increased by $1.144 million now - and not just $1.053 million.

In fact, our City Council Finance staff person informs Councilmember Thune that $92,000 has already been added to the Palace Rec Center project in the latest CIB budget materials that came out after the Mayor's recent budget address at the Schmidt Brewery in mid-August. In other words, the Mayor is recommending replacing that $92,000 immediately.

So, when the City Council votes to adopt the budget for 2015 in December of this year, they will also be voting to add an additional $92,000 to the Palace Center budget, just a little more than what was taken out for the Jefferson Avenue bike boulevard.

Please indulge me while I take a few minutes to talk about the Jefferson Avenue bike boulevard. This project was originally brought forward by West End residents who were concerned that their children do not have sidewalks on Jefferson, that the street lighting there is very bad, and that cars have a tendency to speed down that hill. We worked for years with Public Works until an opportunity to obtain some federal funding for a pedestrian/bike street improvement became available. The residents on Jefferson got on board early in supporting this way to make their street safer for the children, and for all walkers and bikers who use the street. There will also be bump-outs for parking, which will help in getting children into and out of cars without worrying about getting hit from behind by someone coming down Jefferson too fast. And hopefully the bike boulevard itself will make it safer for children to bike to school and other activities.

Happily for the West End, this is not an either/or situation. We will get both a new bike boulevard complete with sidewalks and street lights AND an expanded and upgraded Palace Rec Center. There will just be a few more minor items pushed to the 2016 budget cycle instead of the 2015 budget cycle, and it was always planned that there would be a 2016 budget cycle for Palace.

As always, we would be happy to hear from you on this or any other subject.