A Council Divided: Should Stillwater Spend $65K on Economic Development Study?

As expected, Tuesday night’s discussion surrounding the Stillwater Chamber of Commerce’s request for the city to fund an economic development study was quite controversial.

The Downtown Revitalization Committee, a subcommittee of the Stillwater Area Chamber of Commerce’s Community Symposium, has been working on a plan to revitalize downtown.

On May 7, Todd Streeter, the chamber’s executive director, asked the city to pay for a group of studies looking into the economic, demographic, marketing and business mix aspects of downtown Stillwater’s retail sector.

The cost of the survey will be about $65,000.

After giving the council additional details about the proposed study, Streeter turned the microphone over to Commercial Realtor Kevin LaCasse and downtown landlord and business owner Larry Cramer.

LaCasse and Cramer told the council they both believe the study could help find a successful business mix looking to the future of downtown, and spoke to the struggles both landlords and business owners are having in a tough economy.

“There’s a misperception that everything is fine when you go downtown on the weekends and see the sidewalks filled with people,” LaCasse told the council. “But if the cash register isn’t ringing, they aren’t making any money and can’t pay the landlord, then the landlord struggles to pay the taxes and the mortgage. It’s a serious trickle-down effect … and it does impact the city.”

The government, the landlords and the business owners need to work together, Cramer said. This study is important.

While city council members tend to agree with the work the group has done—and that economic development should be a focus—the council is divided on how to go about it.

“We have no enforcement mechanism for the implementation of this plan,” Ward 3 Council Member Tom Weidner told Cramer. “There’s nothing set up for the implementation of this plan. We are not the landlords of downtown, because we do not control downtown. We don’t control space, we don’t control the businesses and we don’t control what goes in it. I understand what you’re saying, but personally I don’t believe this is the purview of a government body to fund that study. I don’t believe it... I think it’s a great idea for business owners to do this, but whether or not I think it’s the right thing for government, for us to spend taxpayer dollars on for a study, I don’t think that’s the proper use of it.”

Ward 2 Council Member Ted Kozlowski said he would like to see the city form an economic development committee much like the St. Croix County EDC in Hudson.

“I love what your group is doing. I love the energy. The level of expertise you guys bring, the passion and the willingness to work is amazing, but I think we need to formalize that into a group, commission or authority of some sort,” Kozlowski said. “That’s so we could give you the authority to do things, and help you direct the purpose and have staff on board creating a group that has some continuity, that has some authority and can come up with some recommendations that the city can fund. Then we can actually hold this group accountable once we give them the tools and authority to do something.”

Economic development needs to be a priority, he continued, the city can’t let this go on autopilot, but the study is just a lot of money.

“I’m astounded to listen to my colleagues speak the way they are,” Ward 1 Council Member Doug Menikheim said. “I hear tremendous defensiveness. What are you afraid of? We have a downtown that’s mired in mediocrity, they’ve come to speak to us about the seriousness of their problems and we’re saying we don’t want to bring any experts in. … We do not have the skills in our city staff that you are saying they can do. They don’t have those particular kinds of skills, so to ask them to go and do it—come on.”

“I’m asking for a commission to recommend the same things,” Kozlowski said. “Their job would be to make downtown better. If a commission asks for a study, it’s different from this group asking for the study.”

“Now I’m hearing you say we don’t trust those guys,” Menikheim said.

“It’s not a trust issue, Doug. It’s about accountability and authority,” Kozlowski said. “This group has no authority.”

If the council spends taxpayer money, Ward 4 Council Member Mike Polehna said, the recommendation should be coming from city staff.

“I am comfortable with a recommendation coming from staff,” Polehna said. “I am not comfortable with us sitting here choosing Buxton—who I have no idea of their credibility. I have downtown business owners calling me saying there’s no way we should be doing this study. We’re trying to make this work.”

The council is “delaying the decision,” Menikheim quipped. “Where’s the courage?  What are we afraid of?”

It’s not about courage or fear, Weidner said. In towns with economic development committees, it isn’t a study that solves the problem, it’s the people in the city that solved the problem.

“I agree that the city has a responsibility to assist with economic development. Because I disagree with the form and method that is being offered, doesn’t mean I am against helping business owners,” Weidner said. “What I’m saying is I don’t agree with the method by which we’re doing it. … I have a philosophical difference in what I think the city’s role is, and what we should be doing.”

Kozlowski said an economic development commission could be formed and made up of city staff, members of the community symposium and business leaders who would be charged with increasing economic vitality in Stillwater, figuring out what kind of incentives can be provided to attract the right businesses, finding experts for studies, surveys and suggestions, and coming up with an overall economic development plan to make the city better.

“So we’ll end up with the exact same thing we have here?” Menikheim said.

“Except we’d have accountability,” Kozlowski said.

Bottom line is the city has to be involved, Polehna said.

“It’s a lot of money. It’s taxpayer money and I want to be sure we are responsible for the $60,000,” Polehna said. “There should be other skin in the game except just us.”

The council directed staff to look into the proposal and bring back a recommendation for the council to vote on when Stillwater Mayor Ken Harycki is present during the next meeting.