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96-305_. � - �. � � : RESOLUTION Green Sheet # '� 0 �O � � NNESOTA Presented 1 2 3 4 5 6 7 8 9 10 11 Referred To Council File # � ��� Committee: Date as WHEREAS, the Department of Pluuiing and Economic Development has been directed by City of Saint Paul Council Resolution to prepare an annual report on the job impact of funding development projects in the City of Saint Paul, and WHEREAS, the Department of Planning and Economic Development has compiled the 1995 figures and has also received the 1995 figures from the Saint Paul Port Authority, BE IT RESOLVED that the Saint Paul City Council accepts the 1995 Report, "1995 Job Impact Report to Mayor Norm Coleman and Saint Paui City Council." Requested by Department of: �� By: ��" By: Adoption Certified by Council Secretary Plana2in & Econ 'c Develo ment BY �� � Tie/ �: 9�- �� DEPARTMENT/OPFlCE/CAUNCIL DATE INITIATED N� 2 9 0 6 9 Planning & Economic Development 3-20-96 GREEN S HE�T � INITI INRIAL/DATE COHTACT PERSON 8 PHONE � OEPAfiTMENT DIRECTOR � CfTV COUNpL Ann Copeland, 2666595 p55�N rl CINATfOPNEY � cmc�K NUNflEB FOR 4� MUST BE ON CqUNCIL A pOUTING O BU�GEf DIFECTOFi � FlN. 8 MGT. SERVICES DIR. March 27, 1996 or discussion oxoex Q MpypR(ORASSISTANq � TOTAL # OF SIGNATURE PAGES } (CLIP ALl LOCATIONS FOR SIGNATURE) ACTION qEOUESTED: . Acceptance of tLe 1995 Report to Mayor Norm Coleman and Saint Paul City Council. MAR 2 ����6 FiECOMMENDATIONS: Apprave (A) or Feject (R) PERSONAL SERVICE CONTRACTS MUST ANSWER THE FOLLOWING QUESTIONS: _ PLqNNING COMMISSION _ CNI� SERVICE COMMISSION �� Has this persorVfirtn ever worked under a corRrect for this tlepartment? _ CIB COMMIT7EE _ YES NO 2. Has ihis person�rm ever been a ciry employee? _ STAFF _ YES NO _ DISTRICTCOURT _ 3. Does thi5 pefsOn/Fifm possess a skill not normally possessed by any current city employee? SUPPORTS WHICN COUNCIL O&IECTIVE? YES NO Explain all yes answers on separate sheet and attach to grcen shcet INITIATING PROBLEM, ISSUE, OPP�RTUNITY (Who, What, When, Where, Why)� The City Council has directed the Department of Planning and Economic Development to compile an anuual report on the job impact of funding development projects. ADVANTAGESIFAPPROVED: The Department of Planning and Economic Development will have complied with the reguest of the City Council. DISADVANTAGES IFAPPROVED. None ��9",�`;�>:;. � �s����` .,:rir� � >,, g�y�� �� DISADVANTACaES iF NOT APPROVED: The City Council direMion to the Department will not be met 70TAL AMOUNT OF THANSACTION 5 �� COST/pEVENUE BUDGETED (CIRCLE ONE) YES NO FUNDIIdG SOURCE ACTIVITV NOMBEH FINANCIAL INFORMATION. (EXPLP,IN) q c,_3o� 1995 Job Impact Report to Mayor Norm Coleman .�� Saint Paul City Council Prepared by the Department of Planning and Economic Development Larry Buegler, Director March, 1996 - 1 �e •' "�o� INTRODUCTION - Job creation and retention is a major consideration for any public agency using public funds for economic development purposes. Saint Paul, along with other major urban centers across ihe United States, is emphasizing the ixnportance of creating and retaining jobs within its boundaries. Even though Saint Paul currently has the lowest unemployment rate, 3.2%, since record-keeping began in 1978' it is essential for the continued health of the City that jobs be retained and new jobs created. The Mayor and the Ciry Council have chazged the Department of Planning and Economic Development the task of assembling information on the job impact of public funding of economic development projects. The Department was also asked to include job impact inforxnation from the Saint Paul Port Authority. Department of Plannine and Economic Develonment In order to document the impact on job retention and creation of public funds used for economic development in 1995 all projects approved by the Credit Committee of the Department of Planning and Economic Development were considered for their job impact potential. Applying the criteria given below to economic development projects funded by the City of Saint Paul through its Housing and Redevelopment Authority shows that 1,048 jobs were retained and 159 new jobs have been or will be created. Criteria 1. The contract or loan agreement was signed in 1995. ♦ Using this criteria meant that the project is proceeding and therefoae the job statistics can be documented. Some projects approved for funding do not proceed for various reasons and any jobs considered in the process do not materialize. ♦ This criteria eliminated all the STAR projects. These were selected in 1995 but did not sign contracts until 1996. STAR projects with contracts signed in 1996 will be included "an the 1996 report. ♦ Several lazge job-generating projects such as Midway Mazketplace and the Children's Museum aze not included in the statistics because their loan agreements were signed prior to 1995. For example, the Children's Museum move to downtown Saint Paul retained 30 full-time equivalent (FTE) positions: 20 full-time and 20 part-time. With the opening of the new building the Museum now has 70 FTE employees. When both Phase I and Phase II of Midway Mazketplace are complete an estimated 400 jobs wiil be retained and up to 1500 jobs created. PED cooperated with the Saint Paul Port Authority in the reopening of Radisson Inn Town Square. The 43 new jobs at the Inn and the 236 retained jobs at the Radisson Keilogg aze documented in the Port �"5aint Paul Five-Year Economic Milestones: 1991-1995," prepazed by Mark Vander Schaaf; Saint Paul Depaztment of Planning and Economic Development, Mazch 12, 1996. q�,_3os Authority portion of this report. ♦ The job impact information now in place in PED will allow future reports to show how 1995 publiciy-funded projects aze affecting the job picture for Saint Paul in foliowing years. Criteria 2. New money was put into the project or conduit revenue bonds were issued. ♦ Projects returning to the Credit Committee for changes in loan subordinations, loan workouts, revenue refunding bonds, etc. where no new money was put into the project were not inciuded. Criteria 3. The project had the potential to generate or retain permanent full-time equivalent jobs. ♦ Housing projects were not included since none resulted in full-time building manager or maintenance job. ♦ Construction jobs because they are temporary are not included in these statistics. However, construction jobs are a major contributor to a city's economy. Midway Marketplace alone is providing 650 construction jobs. PED staff is looking at ways to arrive at an accurate estimate of those }obs for future reports. ♦ Secondary job creation is another area that benefits from City investment in projects but is almost impossible to document. For example, new or rehabilitated buildings or new businesses may require cleaning, catering, or security services which may be contracted out to other businesses. Those jobs which are an indirect result of public investment do not show up on any report. Notes on the Job Impact Table In reviewing the information on job impact, PED staff decided that a more accurate picture is given by including additional information beyond the cost of a project and the number of FTEs retained or created. Therefare the table gives the Public Purpose for each project as well as the total cost of the development. Contrasting this figure with the amount of money put into the project through the Housing & Redevelopment Authority (Column 4) shows how the public money is leveraging other investment. The City Subsidy per Job (Column 9) amount was generated by dividing the Risk Reserve by the total number of FTEs retained and created. This method was chosen because the risk reserve more accurately reflects the opportunity cost incurred in funding a particulaz project. 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Q �� N 9 N�� II .fl ' QI O m d w 0, � O U ' O ' U ai O', O � O 6 "! C _ 0 �C � ', i i ' � , W C I R U a o ' w.. ¢ - � o � U p�, d N N N DlQ �' z� '6 2 m � � y j U o;; Q � �A a �, „@ S 6 � � L f- v v o'C � Y.�°'. � �� � � F m y� m m T � m p � � n a � a' ' m a '� c a u ,'o Z m c �' �� � c o� `�' a s 3 rL a � a o m� mw 1-U ' U Z I r � d �- �y� 3� . , � �cn C ' C � Y � � � � ' � ' (O m',� °'m o w- `07 ��0 3N I m y _ a`mv>_ �n�n_<n..-_ �_m _F� 3�! } y N 1 � b � m m c� � N N � N � N � N a m � � � I y Q H O q � -3os The Saint Panl Port Authoritv In its annual production summary Port Authority Development Team staff projected 665 jobs new to Saint Paul to be created and 1,369 jobs to be retained in the future by companies funded in 1995. They did not include in this total the projected employment at the Radisson Inn Town Square of 43 and the 263 retained jobs at the Radisson Kellogg. Port Authority financing production included 14 customers with a total project cost of $15,535,000. They used fmancing from the Business Development Fund, Working Capital Guaratees, Banlc1[JI�UM, Business Retention Fund, Ciry Strategic Investment Fund, CounTy, State Economic Recovery Fund. Job specific numbers for each of these 14 projects were not given in the report. The following table shows Port Authority leasing activity with job impact for specific Port Authority owned locations in Saint Paul. The table shows 344 jobs created and 28 jobs retained. ' 1995 ANNiJAL PRODUCTION SUMMARY, Port Authority Development Team, 16 pp. a�_�os �` r a 0 � � � Q F O a � � a Z � 0 a Q O � � � {Y v, w �' O Q w J J Q F O F N C -+,' L�� :\ Q N Ci N N N N C 0 0 0 o O o 0 o O o 0 0 N 7 N N N N N Q ��� d � d d d d� d n� > > > > > > > > > > � > > n' o o � o O O o 0 0 o a` o o` � � � d �� i � G . ` O 'J_ m O 6 6�' 6� �6 � 6 Q �. �' G� 6 6 0. O. z L Yi � W y W N tL P W W W w W y W W W t+1 U1 c'i t�6 c] N t� � Cl M c7 CI c'! O c'I N M C1 C'� n (7 N N N.- N M N. 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