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Six North Branch officials attended the Chisago County HRA/EDA October 21 meeting.

The agenda for Chisago County's directors who oversee county economic development and housing interests included a review of issues surrounding a North Branch redevelopment project facing intense financial hurdles.

North Branch staff and elected officials Amy Oehlers, Theresa Furman and Larry Erickson said they came to gauge the county's interest in aiding North Branch with the redevelopment area known as ESSBY. (See graphic. ESSBY comes more-or-less from the first letters of the families' names who were originally property owners in this district.)

Oehlers, as vice-mayor, advised the Chisago County Housing and Redevelopment Authority Board members the city is seeking help, "...not only to make ESSBY a success for the city but for the county as well."

No dollar amounts were presented last week except for city officials explaining that County involvement might entail issuing (or joining in the issuance of) some form of bonding. Oehlers added there's "no dollar amount" identified at this time. Additional details are expected to be presented at the November 10 North Branch City Council meeting.

ESSBY began as a city project around 2003.

At that time council members and North Branch's Economic Development Authority policymakers had determined North Branch was well-positioned for a project such as ESSBY. North Branch's industrial park to the east side of County Road 30 was close to full and more land was needed to meet policymakers' 20-year vision.

The basic problem is that the ESSBY development projections haven't been met.

According to information in city council meeting packets in 2005 a new freeway interchange was expected to to be under construction by 2007-- off an extended 400th Street, which is the main artery across the lower third of ESSBY. A report to council said there would be "...excess TIF (revenues) from the housing and industrial project (to) help pay for construction of this bridge."

The city has put, by most accounts, approximately $7 million into creating ESSBY. This ranges from property acquisition, demolishing old homes and capping wells, to building infrastructure.

The dilemma for North Branch is that ESSBY lots are not being sold, revenues are non-existent and North Branch has some massive payments due soon on financing measures.

The ESSBY area has been pieced together over the years. Some of the parcels include the Engdahl Family which sold North Branch 176 acres. Don Bauer also sold the city 20 acres. The Sellman Family sold 22 acres. North Branch paid anywhere from $12,000 per acre to $27,000 and more per acre, for these parcels. The city used some cash on-hand and borrowed.

In 2004 North Branch took on improvements to secondary streets within ESSBY of 410th and Fletcher, with future assessments earmarked to help pay the city back for the costs.

The 93-acre Sederberg parcel was highly attractive to North Branch as a necessary piece to fill out this redevelopment puzzle. But North Branch couldn't afford to buy this piece on its own.

The county HRA/EDA (with County Board approval) partnered on acquiring the 93 acres in 2006, with the HRA the conduit for Chisago County issuing a $1.2 million private revenue bond and loaning the city $1 million.

ESSBY now totals 300 acres, according to information shared at the HRA/EDA meeting.

Along with helping buy the 93 acre site Chisago County also constructed an approximately $2 million Health and Human Services office building in ESSBY. The county commissioners agreed this would demonstrate support for the city's business park concept and to initiate some building activity that would motivate investors.

North Branch city officials last week were hopeful the county's HRA/EDA Board members still embrace this cooperative spirit.

North Branch City Administrator Bridgitte Konrad told the meeting attendees the city council couldn't come to terms on voting for creation of a Tax Increment Financing District in ESSBY at the last council meeting and that the measure comes up again November 10.

There's a possibility of the city council revising the ESSBY plan and deleting about 100 acres now proposed for housing uses, which at a public hearing council heard many citizens express opposition to.

Konrad added that a TIF District designation (housing) is integral to beginning to generate money (sale of TIF bonds) for meeting financial commitments.

Tom Willette, recently hired as North Branch's new economic development director, told the HRA/EDA Board the city will have specific options laid out by financial experts Ehlers & Associates, and Briggs and Morgan, bond legal counsel, by the November 10 city council session.

Willette added that the city is hoping to identify a variety of approaches; re-negotiating debt, re-financing and/or landing a partner such as Chisago County.

HRA/EDA Board member Jim Stein told Willette (towards end of meeting after city elected officials exited) that his feeling is the county "...is a little loaded-up in North Branch."

David Boniface, HRA/EDA Board member, noted however, the county as a whole has very little "lot availability" in industrial and business real estate, and he didn't want to shut the door on at least reviewing North Branch's needs.

The issue was left with there being a potential for a special HRA/EDA meeting-- depending on what comes out of the North Branch Council meeting November 10.

County Commissioners Mike Robinson and Lynn Schultz attend the HRA/EDA as non-voting members and County Commissioner Rick Greene was also at last week's meeting to observe.

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