On the agenda: Forest Lake meeting — data center (May 4)

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NOTICE OF AGENDA
ECONOMIC DEVELOPMENT AUTHORITY (EDA) MEETING
City of Forest Lake - Link to Meeting Livestream

Forest Lake City Center – Council Chambers
Forest Lake, Minnesota
May 4, 2026 – 6:00 PM (new time)
1. Call to Order
2. Roll Call
3. Pledge of Allegiance
4. Approve the Agenda (Action)
5. Open Forum - Citizen Petitions, Requests and Concerns: Please sign in at the front table.
The Open Forum is available for residents to express personal opinions for any item of business.
Please limit your comments to three (3) minutes.
6. Consent Agenda Considerations (Action Items)*
a. Approve Minutes from Regular Meeting of March 2, 2026
*EDA may remove any item from the consent agenda for specific consideration.
7. Regular Agenda (Action Items)
8. Discussion
a. Draft Business Subsidy Policy
b. Draft 2025 Community and Economic Development Report
9. Updates
a. City
b. Washington County
c. Forest Lake Area Chamber of Commerce
d. Other
10. Closed session pursuant to Minnesota Statutes § 13D.05, Subd. 3(c)(3), to develop or consider offers
or counter offers for the purchase or sale of property identified as 29.032.21.32.0001 Washington
County, Minnesota.
11. Adjourn
*A quorum of the City Council is possible at all Board and Commission Meetings

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EDA MISSION STATEMENT
Assist and support the economic climate of the City of Forest Lake through programming and communication to achieve the greatest outcome
for its citizens and businesses by:
•
•
•
•
•

Marketing the City and its assets
Supporting existing businesses
Supporting new businesses
Creating partnerships
Providing a vision for the future of commercial areas

*A quorum of the City Council is possible at all Board and Commission Meetings

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ECONOMIC DEVELOPMENT AUTHORITY 1408 Lake Street South

Forest Lake, MN 55025

Regular Meeting

www.ci.forest-lake.mn.us

~ Minutes ~
Monday, March 2, 2026

6:00 PM

City Center - Council Chamber

City of Forest Lake - Livestream and Recorded Meetings

1. Call to Order
2. Roll Call
Attendee Name
Leif Erickson
Eric Langness
Jill Grindahl
Blake Roberts
Jennifer Lorge
Chris Hoyt
Johnathan Wright

Title
EDA President
EDA Commissioner
EDA Commissioner
EDA Commissioner
EDA Commissioner
EDA Commissioner
EDA Commissioner

Status
Present
Present
Present
Present
Present
Present
Present

Arrived
6:42 p.m.

3. Pledge of Allegiance
4. Approve the Agenda
Motion: EDA Commissioner Lorge made a Motion to Approve the Agenda as submitted.
Motion seconded by EDA Commissioner Wright. Motion carried 6-0.

5. Open Forum – Citizen Petitions, Requests, and Concerns

The Open Forum is available for residents to express personal opinions on any item of business.
Please limit your comments to three (3) minutes.
Comments:
None.

6. Consent Agenda Considerations (Action Items)*

a) Approve Minutes from Regular Meeting of January 5, 2026
b) Approve Minutes from Regular Meeting of February 2, 2026

Motion: EDA Commissioner Wright made a Motion to Approve the Consent Agenda.
Motion seconded by EDA Commissioner Grindahl. Motion carried 6-0.

7. Regular Agenda (Action Items)

a) Acceptance of Forest Lake Area Chamber of Commerce 2025 Annual Report
Community Development Director Wittman reviewed the 2025 Annual Report from the Chamber.

Economic Development Authority

Page 1

Draft Minutes

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ECONOMIC DEVELOPMENT AUTHORITY 1408 Lake Street South
Regular Meeting

Forest Lake, MN 55025

www.ci.forest-lake.mn.us

~ Minutes ~
Monday, March 2, 2026

6:00 PM

City Center - Council Chamber

She noted that a copy of the EDA/Chamber 2025-2027 BR&E Cooperative Agreement was included
for review.
Commissioner Grindahl asked about the current questions asked during business visits. Community
Development Director Wittman answered that they often ask for business updates to understand
how businesses are doing.
Commissioner Roberts asked if they could provide a packet from the City that they could provide to
business owners. He asked if they could complete a follow-up with the business as appropriate. He
said it would be nice to know that follow-through was happening, whether it be a quarterly report
or something similar.
Community Development Director Wittman said that more visits happened at the end of the year,
and she thought the visits would continue to expand. She stated that they would try to
communicate the information to the Economic Development Authority.
Commissioner Lorge said that the Chamber of Commerce had newsletters that were informative.
Commissioner Grindahl suggested a survey that they could hand out to businesses so that they
could quickly aggregate the information. Community Development Director Wittman said that she
would have a conversation with Nannette.
Motion: EDA Commissioner Lorge made a Motion to Accept the Forest Lake Area Chamber of
Commerce 2025 Annual Report
Motion seconded by EDA Commissioner Hoyt. Motion carried 6-0.
b) Headwaters 123 Concept Plat Update
Community Development Director Wittman reviewed the decision to take a different approach to
the Headwaters 123 Concept Plan to generate additional tax revenue. She noted that a proposal was
included in the packet to update the Collaborative Concept Plan from TLA-LI.
Commissioner Roberts asked about the scope and if they would present the information to the
body. He asked about the full scope. Community Development Director Wittman answered that the
scope of work was on page 26 of the packet, and it would include a meeting with staff. She said she
could bring the information about the meeting to the Economic Development Authority. She stated
there would be an additional upcharge for the staff to visit the meeting.
Commissioner Roberts stated it would be nice to see the final product presented, but he did not
know if the fee was worthwhile.
Community Development Director Wittman said that the business park district allowed for different
uses, and the idea was to consider how to design the location that would attract high-paying jobs
Economic Development Authority

Page 2

Draft Minutes

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ECONOMIC DEVELOPMENT AUTHORITY 1408 Lake Street South
Regular Meeting

Forest Lake, MN 55025

www.ci.forest-lake.mn.us

~ Minutes ~
Monday, March 2, 2026

6:00 PM

City Center - Council Chamber

and increase the tax base.
Commissioner Lorge asked about the wetland. Community Development Director Wittman
answered that the wetland delineations were good for five years. She said that there might be some
drain tile that would need to be repaired.
Vice President Langness asked about the opportunity for the consultant to meet virtually to present
information. Community Development Director Wittman responded that she would check about the
opportunity.
Commissioner Roberts noted that they separated ways with City Administrator Statz. They desired
to have a subcommittee to support Community Development Director Wittman. Commissioner
Roberts and EDA President Erickson could attend the meeting in person and provide an update to
the Economic Development Authority.
Commissioner Roberts asked about retail along Headwaters 123 and retail to the south. Community
Development Director Wittman answered that they would have a small portion of residential to
better tie in the residential near the golf course. She stated that the Economic Development
Authority also expressed approval for higher-density residential along Fenway. She said that she
heard the Economic Development Authority expressed interest in some services in different areas of
the project. She stated that if they wanted to move forward with residential in different locations,
there would need to be a zoning amendment.
Motion: EDA Commissioner Hoyt made a Motion to Approve the TLAL-LI Collaborative Concept Plat
update work proposal.
Motion seconded by EDA Commissioner Grindahl. Motion carried 6-0.
c) 2026 Workplan
Community Development Director Wittman discussed the proposed one-year workplan for 2026.
Motion: EDA Commissioner Wright made a Motion to Approve the 2026 Workplan Table as presented.
Motion seconded by EDA Commissioner Grindahl. Motion carried 6-0.

8. Discussion
None.

9. Updates

a) City – Verbal
i. City Engineer Ryan Goodman
City Engineer Goodman discussed the scope of the second stage of Highway 97. He discussed the
project design for the intersection of Trunk Highway 61 and County Road 50 planned by the County

Economic Development Authority

Page 3

Draft Minutes

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ECONOMIC DEVELOPMENT AUTHORITY 1408 Lake Street South
Regular Meeting

Forest Lake, MN 55025

www.ci.forest-lake.mn.us

~ Minutes ~
Monday, March 2, 2026

6:00 PM

City Center - Council Chamber

for 2028. He said that the County released a request for proposals for County Road 50 and noted the
portions requested by the City. He summarized the local street work within the City, including
resurfacing streets and making pedestrian ramps ADA-compliant. He said they were still waiting for
a Department of Natural Resources easement for Eureka Avenue. He reviewed the changes on
County Road 32 that would include the realignment of Forest Road. He summarized the Highway 8
project, which would be a cooperative agreement. He discussed the lead surface line replacement
on North Shore Drive.
Commissioner Roberts asked if they were contemplating bringing water and sewer to Goodview
Circle. City Engineer Goodman responded that they would be working through this project in the
next couple of months, as the developer wants to get to a 90 percent plan by May.
Vice President Langness asked about the access to Goodview Circle and if it would be maintained as
right-out/right-in only.
Commissioner Lorge asked if Highway 8 would be two lanes and a turn lane. City Engineer Goodman
answered that there would be switchbacks to prevent traffic from crossing. He said the
environmental considerations were a major component along the corridor.
President Erickson asked if there would be sound barriers on Highway 8. City Engineer Goodman
answered that there would be no sound barriers on Highway 8.
President Erickson asked about access to Fenway. City Engineer Goodman said that they were trying
to get the road from Felkin to Fenway completed as quickly as possible to help with the traffic flow.
b) Washington County
i. Open to Business 2025 Summary Report
Chris Eng provided a summary of all the businesses assisted in the County in 2025. He suggested
that businesses reach out if they are struggling.
Vice President Langness asked about businesses assisted outside of the County. Mr. Eng answered
that it could be a referral or a business that moved.
c) Forest Lake Area Chamber of Commerce
President Erickson noted that the Chamber Expo would happen in March.

10. Adjourn

Motion: EDA Commissioner Wright made a Motion to Adjourn the Regularly Scheduled EDA Meeting at
6:57 p.m.
Motion seconded by EDA Commissioner Grindahl. Motion carried 7-0.
Economic Development Authority

Page 4

Draft Minutes

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STAFF REPORT
MEETING DATE:

May 4, 2026

TO:

President Leif Erickson and EDA Members

STAFF ORIGINATOR: Abbi Wittman, Community Development Director
AGENDA ITEM:

Draft Business Subsidy Policy

______________________________________________________________________________
INTRODUCTION:
State law requires that the City have an over-arching Business Subsidy Policy if the City is to
offer financial assistance to businesses and developments. The intent of this Policy is to serve as
a foundation for all types of financial assistance to businesses and for developments in the
future. Any other EDA financial assistance program thereafter would be tailored to specific
types of projects, developments, and land uses. However, all other EDA financial assistance
programs would need to conform to the Business Subsidy Policy.
Over the years the City has either adopted (2009 and 2012) or drafted (2023) such policies,
these have been challenging to use for a variety of reasons. First, given their over-arching
nature, many of these policies (2009 and 2023) have indicated the City will use public subsidies
for ‘all the things’. While it covers anything the City would want to possibly finance in the
future, it doesn’t provide guidelines for City staff or the public and – therefore – its hard for City
staff to advise landowners, developers, etc. Next, the 2012 policy (the currently adopted
policy) was developed when there was an active application, so it has a narrower focus. Lastly,
all of them have too many words. All three policy sets are enclosed for EDA review.
Staff has been working on updating the Business Subsidy Policy with the following goals:
1. Make the Policy easy to read and understand for the public, City Council/EDA, and staff.
Simply put, having a document only financial professionals can understand does not help
the City.
2. Make the Policy specific to the City’s future development and land use needs and
desires. While subsequent Policies can be tailored down, this Policy does need to be
broad enough to cover what the City anticipates for future growth and development.
Enclosed is a Draft Business Subsidy Policy for EDA review. At the EDA meeting, City staff will
walk the EDA through the document, lead discussion on a few policy items, and receive
direction on not only finalizing this document but also to bring back subsequent policies (i.e. TIF,
Tax Abatement, and loan sponsorship). If Commissioners are so inclined, other similar policies
of peer cities can be found at Elk River, Farmington, Prior Lake, Ramsey, and Rosemount.
ANALYSIS:

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In preparation for Monday’s meeting, staff is requesting the EDA review the document, paying
more specific attention to the following:
-

-

Intent – this section is specific to why we are doing this. Do these items address the
overall reason(s) we would consider economic incentives?
Eligibility – these are the types of projects we would consider providing public assistance
for. If it is not on the list, we would not provide assistance. While this is the area of
Policy that has been broad reaching, honing this section down significantly helps staff
and the development community in the long run. Additionally, this helps the Council
and public better understand priorities.
Job Creation and Wage Information – State law requires we have specific information set
forth for job creation and wage goals. While State law allows for us to deviate from
them, we need to establish the minimum requirements. For discussion:
o Job Creation – in the past, the City has agreed to offer public subsidies when a
minimum of one new job is created. However, many other peer cities require 5,
10, or ‘the maximum number of jobs feasible’.
o Wages – State law requires our minimum wage requirement is at least 115% of
the federal minimum wage ($8.34/hour or $17,342/year)). As of 2012, the City
required a minimum of 150% the state minimum wage (now $17.12/hour or
$35,609/year). However, many cities (and even DEED programs) require a
minimum of 200% of the state minimum ($22.82/hour or $47,466/year).

RECOMMENDATION:
Staff is requesting the EDA discuss the enclosed Business Subsidy Policy and provide direction
for future policy finalization and adoption.
ATTACHMENTS:
Draft Business Subsidy Policy

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DRAFT City of Forest Lake Business Subsidy Policy
I.
II.
III.
IV.
V.
VI.
VII.
VIII.
IX.
X.

Introduction and Overview
Purpose and Intent
Legal Authority
Business Subsidy Eligibility
Application Submission and Review
Legal Agreements
In-Eligibility and Disqualification
Disclaimers
Data Practices Law
Amendment

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Introduction and Overview
It has been the practice of the City of Forest Lake (City) and its Economic Development
Authority (EDA) to provide business subsidies for redevelopment and to business and industry
relocating to or expanding in the city. These subsidies can be instrumental in developing and
maintaining Forest Lake’s sustainable, diversified economy. The development and adoption of
formal Business Subsidy Policy will ensure a uniform and coordinated approach to economic
development activities and incentive awards.
For the purposes of this Business Subsidy Policy, a "business subsidy" or "subsidy" means a
grant, contribution of personal property, real property, infrastructure, the principal amount of a
loan at rates below those commercially available to the recipient, any reduction or deferral of
any tax or any fee, any guarantee of any payment under any loan, lease, or other obligation, or
any preferential use of government facilities given to a business.
Purpose and Intent
The purpose of this Business Subsidy policy is to establish policies and procedures for the
regulation and use of financial assistance tools. For the purpose of this Policy document and
subsequent amendments, the term “City” includes the Forest Lake City Council, EDA, staff,
financial consultants, and legal counsel.
The intent of the City of Forest Lake’s Business Subsidy Policy is:
1. To ensure the long-term well-being of Forest Lake citizens and the community by
ensuring the City’s ability to expand its diversified economy well into the future.
2. To create high-quality employment opportunities for its citizens by retaining and
expanding the existing business base and attracting new businesses to the City.
3. To build a diverse tax base, by strengthening commercial, industrial, and mixed-use
districts while providing a variety of housing options.
4. To encourage and sustain orderly growth, development, and redevelopment in and
around Forest Lake.
5. Ensure responsible stewardship of public funds.
Legal Authority
This policy is adopted in accordance with:
•
•
•

Minnesota Statutes Section 116J.993–116J.995 (the Business Subsidy Act)
Minnesota Statutes Chapter 469
Applicable DEED reporting requirements

Business Subsidy Eligibility

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The City may consider business subsidies for private development projects that meet a “public
purpose”. The public purpose cannot be limited to an increase in tax base, must be measurable,
and must benefit the City as a whole. Such assistance must comply with all applicable statutory
requirements and meet two or more of the following criteria:
1. Projects that provide needed public infrastructure improvements that would be
completed in conjunction with the project.
2. Projects that create new business or residential opportunities in Downtown Forest Lake.
3. Redevelopment projects that result in the stabilization of business districts or
transportation corridors by eliminating blighted conditions.
4. Projects that assist in the orderly growth of the City and generate significant economic
spinoff.
5. Projects that enhance or increase the economic diversity of the Forest Lake by attracting
businesses or industries not currently located in the City.
6. Projects that enhance the value of surrounding properties, stabilize the area or foster a
‘sense of community’.
7. Projects that result in higher wage and quality employment opportunities, as required
by the Business Subsidy Act.
a. New Job Creation – The applicant will be required to demonstrate that the proposed
project will create
considering the project type and site. If the City determines
that the creation of jobs is not a goal of the specific project, the job creation goal will
be set to zero.
b. Minimum Wage Requirements – New jobs created by the project must pay at least
of the State of MN Minimum Wage exclusive of benefits. The City may
establish wage goals for new jobs to be created that vary from the standard above.
Meeting this policy criteria does not guarantee the award of business subsidy for the project.
Application Submission and Review
Applicants will complete and submit:
•
•
•

•

A City application.
Site plan, building floor plans, landscape plans, and building elevation concepts.
The application fee of an amount established in the City’s Fee Schedule to cover
administrative review costs and professional services, including financial and legal
advising.
Other information which may be requested by the City. This will include, but not be
limited to, required market and financial feasibility studies, appraisals, soil borings,
information provided to private lenders for the project, and other information or data as
requested.

The review process shall involve at least the following:

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1. Once the application is submitted and deemed complete, the City will review to ensure
the following:
a. The project is deemed consistent with City’s Goals and Objectives outlined in the
Comprehensive Plan and City Code
b. The project meets the minimum qualifications of this Business Subsidy Policy
c. The project meets “but-for” analysis and/or other statutory qualifications.
2. The City will prepare a non-binding Term Sheet outlining the details and conditions of
any public assistance.
a. For assistance that does not constitute a business subsidy under the Business
Subsidy Act, the grantee and the City will enter into an agreement setting forth the
terms of the assistance.
i. Approval will occur at the next available City meeting after Agreement signature.
b. For assistance that does constitute a business subsidy under the Business Subsidy
Act, the EDA will review the Term Sheet and
i. Act on the application, if so authorized by specific policy.
ii. Make a recommendation to the City Council,
1. The City Council will consider approval of the Term Sheet at a subsequent
meeting.
3. If the Term Sheet is approved by City Council, the developer shall make an additional
escrow deposit to cover costs incurred as part of establishing a TIF district or abatement,
drafting and negotiating a development agreement, and conducting any fiscal analysis
that may be required to meet the requirements of utilizing any public financing. If
additional expenses are incurred beyond the initial deposit, prior to the execution of a
development agreement, the City/EDA shall notify the applicant in writing and the
applicant will be required to deposit additional funds upon notice.
4. Prior to approval of any Agreement the City Council will hold a public hearing. A public
notice shall be published in print and if possible, on the internet, at least 10 days prior to
the hearing identifying the location, date, and time of the hearing and providing
information about the business subsidy proposed, including a summary of the terms of
the subsidy.
The City reserves the right to approve or reject projects on a case-by-case basis, taking into
consideration established policies, project criteria, and demand on City services in relation to
the potential benefits from the project.
Legal Agreements

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If the subsidy application is approved, the business and the City will enter into Agreement. All
Agreements shall contain:
•
•

A description of the subsidy, including the amount and type of subsidy
A statement of the public purposes for the subsidy

If required by the Business Subsidy Act, the Agreement will commit the recipient to provide the
reporting information required by the Business Subsidy Act, if any. The Agreement shall provide
the following information:
a.
b.
c.
d.
e.

Wage and job goals (if applicable)
Measurable, specific and tangible goals for the subsidy
Commitment to provide necessary information for reporting purposes
Five-year operation commitment after the benefit date
Recourse for failure to meet goals required by the Statutes

Business Subsidy Act required Agreements may be incorporated into a broader development
agreement for a project.
Ineligibility or Disqualification
An applicant shall be deemed ineligible for assistance under this policy if any of the following
conditions apply:
•
•
•
•
•
•

Financial Delinquency – The applicant is delinquent on obligations to the City (e.g., taxes,
fees, utilities, loans), unless covered by an approved repayment plan.
Pending Legal or Regulatory Action – The applicant is involved in litigation or
enforcement actions that may, in the City’s judgment, impact their ability to perform or
comply.
History of Non-Compliance or Default – The applicant has a record of default, breach, or
non-compliance with agreements, permits, or approvals from the City or other
government entities.
Good Standing – The applicant is not in compliance with applicable legal or regulatory
requirements (e.g., licensing, taxes, labor, environmental laws).
Reputational or Performance Concerns – Credible evidence of poor business practices—
such as repeated violations, substantiated complaints, unethical conduct, or failure to
complete projects—may indicate risk to public resources or community interests.
Material Misrepresentation – The applicant has provided false, misleading, or
incomplete information in current or prior dealings with the City.

The City retains sole discretion to evaluate the totality of circumstances in determining
applicant eligibility and may request additional documentation as needed. Determinations

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made under this section shall be final unless otherwise provided by applicable law or appeal
procedures established by the City.
Disclaimers
•
•
•

Applicant will be liable for any additional costs beyond the initial fees and escrow
deposits.
Approval or denial of one project is not intended to set precedent for approval or denial
of another project.
All materials submitted to the City in connection with a business subsidy application
shall become the property of the City.

Data Practices Law
The City of Forest Lake is a governmental body and is subject to the requirements Minnesota
Government Data Practices Act. Some of the data provided by the applicant to the City as part
of the application for a Business Subsidy may be required to be disclosed if requested pursuant
to the Minnesota Government Data Practices Act.
Amendments
The City may amend this document at any time. Amendments to this Policy are subject to
public hearing requirements contained in applicable State Statutes.

2009 Policy
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CITY OF FOREST LAKE ECONOMIC DEVELOPMENT POLICY GUIDELINES
Introduction
It has been the practice of the City of Forest Lake to provide economic assistance to business and industry
locating or expanding in the city. Types of assistance have included, but are not limited to: tax increment
financing, fee deferment and waivers, grant assistance, conduit bonding and land sales at below market
rates. Economic incentives can be instrumental in developing Forest Lake’s sustainable diversified
economy. The development and adoption of formal economic development policy guidelines will ensure a
uniform and coordinated approach to economic development activities and incentive awards.
Moreover, the development of economic development policy is a continuation of the formalization of city
program practices and is consistent with recent adoption of city policies governing housing strategies and
economic development in the 2030 Comprehensive Plan.
1.0 Purpose
The purpose of these guidelines is to establish policies and procedures for the regulation and coordination
of economic development tools. These policies and procedures shall be used as a guide for the orderly
review and disposition of applications requesting economic development incentives.
2.0 Mission
The mission of the City of Forest Lake’s economic development policy is four (4) fold:
1.
2.
3.
4.

To ensure the long-term well-being of Forest Lake citizens and the community by ensuring
the City’s ability to expand its diversified economy well into the future.
To create employment opportunities for its citizens by retaining and expanding the existing
business base and attracting new businesses to the City.
To build a diverse tax base.
To sustain orderly growth and development in and around Forest Lake.

3.0 Guiding Principles
In carrying out its mission, the City of Forest Lake will adhere to the following guiding principles for
economic development activities. Through its economic development policy the City of Forest Lake is
committed to:
3.01 Retaining, expanding and attracting businesses that provide jobs, sustain investment and bring new
wealth to the community.
3.02 Maintaining a top-tier workforce through coordination among community institutions including:
economic development organizations, employment and training agencies, regional technical and vocational
schools, colleges and universities and the business community whenever possible.
3.03 Ensuring that growth areas continue to receive infrastructure improvements necessary to attract major
new business investment.
3.04 Strengthening the ability of older commercial and industrial areas to support new and expanded
business activity.
3.05 Nurturing small and startup businesses.
3.06 Promoting the development of technology-based products and services.
3.07 Promoting high quality design in expansion and renovation of facilities.
3.08 Promoting and encouraging environmentally sound planning and development standards for the
community.

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3.09 Fostering the successful redevelopment of vacant and under utilized commercial and industrial
properties.
3.10 Addressing identified housing needs of the community.
4.0 Incentives
Incentives are provided to fill gaps in private development project financing that make the project
improbable without support to fill the gaps.
The following economic development incentives may be considered for use by the City of Forest Lake for
certain economic development projects. Not all projects will be considered to be eligible for incentives.
The type and number of incentives is in the sole discretion of the Forest Lake EDA and City Council.
Incentives are as follows:
4.01 Tax Increment Financing-A development tool whereby the taxes generated by a development or
redevelopment project are used to pay the costs of the project incurred by the city. The additional taxes
generated by development are used to reimburse the city’s costs in the project. Four (4) types of Tax
Increments Districts may be considered:
4.01.1 Economic Development District-for new industrial expansion and job creation purposes.
4.01.2 Redevelopment District-to redevelop or reuse previously developed land and/or buildings. This
District is usually used for building code issues, base value purchase, demolition and/or infrastructure
purposes.
4.01.3 Soils Condition District-used to make land with unstable or unsuitable soils usable for development.
4.01.4 Housing District-used to develop affordable housing by acquiring land, buildings and or funding
infrastructure.
4.02 DEED Loans/Grants-numerous grant and loan programs available from the Minnesota Department of
Trade and Economic Development for the purpose of development and redevelopment. The city must
serve as the applicant in partnership with a company or developer.
4.03 Metropolitan Council Loans/Grants- numerous grant and loan programs are available from the
Metropolitan Council for the purpose of development and redevelopment. The city must serve as the
applicant in partnership with a company or developer.
4.04 Conduit Bonds-City issued bonds on behalf of a private developer. Liability for payment of the bonds
is solely that of the developer. The conduit feature is used to obtain interest rates in the tax exempt market.
The City charges a one percent (1%) fee for service provided and pays its costs from that fee. Any
remainder after payment of fees is used to promote the City’s affordable housing program goals. Bond
issues for nonprofit entities may be charged a discounted fee under section 5.05.C of these policy
guidelines.
4.06 Land Sale Write-down’s-Land owned by the City, acquired either through purchase or through
property tax default, is occasionally sold at less than what an appraisal determines to be its estimated
market value. This can be done either because of unique conditions on the site, such as soils, rock,
pollution, or wetland conditions, or it can be done purely as an incentive.
4.06 Special Assessment-The levying of a charge for public costs against property that has received a
benefit from a particular project or activity undertaken by the city. The special assessment becomes a part
of the funding mechanism to defray the cost of the project.
4.07 Economic Development Revolving Loan Fund-provides gap financing through low interest loans to
low to small and medium size businesses for a variety of economic development activities.

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4.08 Industrial Revenue Bonds-bonds issued by the City, the proceeds of which are used to construct
facilities for private business enterprise. Lease payments made by the business enterprise to city
government are used to service the bonds.
4.09 Tax Abatement- property taxes are redirected to pay for public infrastructure improvements beyond
the amounts assessable on a project.
5. Development Categories
There are several areas under the auspices of economic development for which public funds may be
awarded for the economic development activities. For each area there are different goals, incentives and
eligible activities. The City of Forest Lake will consider using incentive funds for projects proposed under
the following categories.
5.01 Manufacturing:
1.
2.
3.
4.
5.

Profile: Companies in the manufacturing domain typically producing a finished product or
engaging in a value added production process.
Goal: To increase the city’s industrial base by using incentives to assist expanding businesses
or to attract new manufacturing businesses.
Possible Incentives: Tax increment financing, DEED loans/grants, industrial development and
conduit bonds, special and deferred assessments.
Eligible activities: Land write downs, equipment acquisition and infrastructure costs.
Priority: Expansion of existing industries that create living wage jobs within existing
companies.

5.02 Retail and Service:
1.
2.
3.
4.

5.

Profile: A company or individual whose primary business is the direct selling of merchandise
or service to consumers.
Goal: To rehabilitate blighted retail and commercial businesses in the City designated
redevelopment zones as part of a redevelopment project.
Possible Incentives: Tax increment financing, revolving loan fund, special assessments,
DEED grants/loans, Metropolitan Council grants/loans
Eligible activities: Façade and store front restoration, energy efficiency and code compliance
issues, demolition, land write downs and other eligible activities permitted by grant issuers
and state law.
Priority: Projects in the downtown Forest Lake area.

5.03 Redevelopment
1.
2.
3.
4.
5.

Profile: Existing vacant and blighted property for a higher use.
Goal: To redevelop vacant and underutilized commercial and industrial properties.
Incentives: Tax increment financing, Tax abatement, special assessments, Metropolitan Council
grants/loans, and DEED grants/loans.
Eligible activities: Site clean-up, demolition, land purchase and write downs, infrastructure
improvements
Priority: Existing blighted property.

5.04 Soils Conditions:
1.
2.
3.
4.

Profile: Sections of Forest Lake that are difficult to develop because of adverse soil or
environmental conditions.
Goal: To create developable property by installing infrastructure and correcting soils..
Incentives: Tax increments, DEED funds, tax abatement.
Eligible activities: Infrastructure expansion, soil correction.

18

5.

Priority: Industrial development areas.

6.0 Evaluation Criteria
In addition to meeting basic funding parameters cited above in Section 5, projects submitted to the Forest
Lake EDA for funding incentives will also be subject to review against certain quantitative and qualitative
measures and criteria. These measures and criteria will be used to judge the soundness of the project, fiscal
solvency of the company requesting incentives, probability of success, impact on the community, and
return on investment. Criteria that will be used to measure these attributes include but are not limited to:
6.01 Optimal Development. All proposals should optimize the development or redevelopment of a site.
6.02 Financial Statements. Performa financial statements that accurately represent company revenues,
expenditures, and fund balances.
6.03 Wage Stipulations. Concurrence with EDA established wage guidelines.
6.04 Job Creation. Concurrence with EDA established job creation guidelines.
6.05 City contribution vs. total project costs. Total combined financial incentives shall not exceed thirty
percent (30%) of total project costs.
6.06 Equity Share. A minimum twenty percent (20 %) equity investment by developer or company is
required.
6.07 Tax base. To the greatest extent possible, the project shall increase the city’s tax base.
6.08 Planning and Zoning. Projects must meet the requirements of the City of Forest Lake city code and
comprehensive plan and all applicable agencies.
6.09 Gap Financing. Incentive funds shall not be used as a primary funding source but only as gap
financing.

7.0 Application Procedures
7.01 Pre-meeting. Interested parties shall meet with appropriate City staff to discuss the scope of the
project, amount of incentive funds to be requested, timetable, and other pertinent project information.
7.02 Pre-application. All parties seeking incentive funding for economic development projects must submit
a pre-application for review by city staff. Pre-application forms may be obtained from the City
Administrator /EDA Director.
7.03 Initial Review. The pre-application will be reviewed by city staff on a preliminary basis to assess
project feasibility. Staff may approve the pre-application or request additional information.
7.04 EDA Agenda. The staff approved pre-application will be placed on the EDA agenda for preliminary
concept review. The EDA may approve or deny the pre-application or request additional information. If the
EDA approved the pre-application the applicant may file a formal application and project proposal.
7.05 Denial. If the EDA denies the pre-application the applicant(s) will receive written notice of the denial
of the pre-application and the reason(s) for the determination within fourteen (14) days of the denial of the
pre-application. Applicants aggrieved by the Board’s decision may submit another pre-application after
thirty (30) days if the reasons given for the denial have been adequately and appropriately addressed.

19

7.06 Planning and Zoning. If the proposed project requires Planning Commission action, the applicant is
responsible for meeting the requirements of all applicable agencies and assuring compliance with the city
code and comprehensive plan prior to final execution of any incentive.
8.0 Other Economic Development Criteria
8.01 Assistance Agreement: Terms of assistance granted, whether Direct Benefit or Indirect Benefit, will be
delineated in an “Assistance Agreement” which will conform in all respects to M.S. 116J.994, Sub. 3.
In addition a monitoring mechanism for compliance with goals and guidelines will be created with each
agreement.
8.02 Wage Stipulations: The City’s goal is to assist in the creation of jobs at wage and benefit levels that
will support families. The minimum job creation requirement is one (1) full time position. ”Livable” wages
are expected to be strongly considered in any job creation portion of an assistance project. Primary wage
stipulations for Direct Benefit Assistance will normally be based on eighty percent (80%) of the median
household income for Washington County. Job creation and wage requirements will be proportional to the
amount of incentive granted.
Secondary wage stipulations: In projects in which the assistance will be provided by another agency, such
as the State of Minnesota or the federal government, the wage guidelines set by that agency, shall be used.
8.03 Affordable Housing Opportunities. Businesses receiving Direct Benefit Assistance shall, during the
job creation period of the assistance, demonstrate the existence of a program to meet the needs of
employees for affordable, appropriate housing. This assistance may be in the form of advances for down
payments or closing costs, grants for house or property acquisition, or other program reviewed and
approved by the EDA. The amount of assistance will be at least five percent (5%) of the incentive value.
Funds must be available to the general employee population.
8.04 Failure to meet goals: The Assistance Agreement must specify the recipient business’ obligation if the
recipient does not fulfill the agreement. At a minimum, the Agreement must require a recipient failing to
meet Assistance Agreement goals to pay back 100% of the assistance plus interest to the City of Forest
Lake, provided that repayment may be prorated to reflect partial fulfillment of the goals. The interest rate
must be set at the implicit price deflator defined under Minnesota Statutes Section 275.70, Subdivision 2.
The City may, after a public hearing, extend the period for meeting the goals provided for in the Assistance
Agreement for up to one year. A recipient failing to meet the terms of the Assistance Agreement may not
receive economic development assistance from the City of Forest Lake for a period of 10 years from the
date of failure or the date the recipient fulfills its payment obligation, whichever occurs first.
8.05 Public Hearing requirements: Under Minnesota Statues 116J, award assistance in excess of twentyfive thousand dollars, ($25, 000.00) in value must be subject to a public hearing held at the EDA or City
Council level after proper notification.

Adopted:

20

ECONOMIC DEVELOPMENT AUTHORITY OF FOREST LAKE
CITY OF FOREST LAKE, MINNESOTA
BUSINESS ASSISTANCE POLICY
Public Hearing: June 25, 2012
Adopted: __________
I.

PURPOSE

The purpose of this policy is to provide guidance for the Economic Development Authority of the City of
Forest Lake (the “EDA”) in its provision of assistance for commercial and housing development and
redevelopment projects. As a matter of adopted policy, the EDA will consider using public assistance to
assist private development only in those circumstances in which the proposed private project shows a
demonstrated financing gap, meets one of more of the goals presented in the City’s Strategic Plan, and is
consistent with the City’s Comprehensive Plan.
This policy shall be used as a guide in processing and reviewing applications requesting public financing
assistance. The EDA shall have the option of amending or waiving sections of this policy when
determined necessary or appropriate.
II.

STATUTORY LIMITATIONS

All forms of business assistance provided by the EDA must comply with applicable state law and
regulation, including Minnesota Statutes 116J.993 through 116J.995. Minnesota Statutes 116J.993,
Subd. 3 defines a Business Subsidy as “a state or local government agency grant, contribution of personal
property, real property, infrastructure, the principal amount of a loan at rates below those commercially
available to the recipient, any reduction or deferral of any tax or any fee, any guarantee of any payment
under any loan, lease, or other obligation, or any preferential use of government facilities given to a
business.” Appendix A lists forms of financial assistance that state law does not consider business
subsidies.
A business subsidy may not be granted until the grantor has adopted criteria after a public hearing for
awarding business subsidies. A grantor may deviate from its criteria by documenting in writing the reason
for the deviation and attaching a copy of the document to its next annual report to the Department of
Employment and Economic Development (DEED). A copy of the criteria must be submitted to DEED
along with the first annual report following the enactment of the Policy or with the first annual report after
it has adopted criteria, whichever is earlier. Notwithstanding Minnesota Statutes 116J.993, subdivision 3,
clauses (1) and (21), “business subsidies” as defined under section 116J.993 includes the following forms
of financial assistance: (1) a business subsidy of $25,000 or more; and (2) business loans and guarantees
of $75,000 or more.
III.

GOALS

As a matter of adopted policy, the EDA will consider using a business assistance tool to assist private
development only in those circumstances in which the proposed private project shows a demonstrated
financing gap, meets one of more of the goals presented in the City’s Strategic Plan, and is consistent
with the City’s Comprehensive Plan. The EDA’s primary development priority is to encourage highvalue commercial development, including but not limited to manufacturing, warehousing, distribution,
office and retail uses. Single-family residential and multi-family housing proposals may be considered
1

21

for assistance on a case-by-case basis.
IV.

PUBLIC ASSISTANCE TOOLS
1. Tax Increment Financing
Tax increment may be spent only for specified purposes permitted in the underlying development
statutes. The Minnesota Tax Increment Act is codified as Minnesota Statutes 469.174 through
469.1811. In addition, the Tax Increment Act specifies the qualifying conditions and/or
development purposes for several types of TIF districts, and the required process for establishing
and reporting on a TIF district.
2. Tax Abatement
Tax abatement may be spent only for specified purposes permitted in the underlying development
statutes. The Minnesota Tax Abatement Act is codified as Minnesota Statutes 469.1812 through
469.1815.
3. City Fees
The City may consider deferring or assessing City fees for purposes permitted in the development
statutes and City Code. Whether a particular fee is eligible to be deferred or assessed over time
may depend on the City Fund’s ability to support the deferment.

V.

BUT FOR TEST

With tax increment financing, the City is statutorily required to find that the increased market value of the
site that could reasonably be expected to occur without the use of TIF would be less than the increase in
the market value of the proposed development after subtracting the present value of the projected tax
increments for the maximum duration of the district permitted by the TIF Plan according to Minnesota
Statutes, Section 469.175, subd. 3(d).
This market value-based “but for” analysis is required only for TIF projects. To allow for this evaluation,
the developer must provide a complete development budget and operating pro forma, and an
accompanying statement explaining the need for assistance.
VI.

TYPES OF FINANCING

The EDA will consider “pay as you go” financing arrangement with the developer. With pay as you go
financing, the developer pays for various costs initially, and the authority promises to reimburse the
developer from tax increment, tax abatement, or other identified economic development and
redevelopment tools over time as it is generated. This arrangement may be structured as a revenue note
or bond issued to the developer, with an interest component to compensate the developer for costs of
financing the improvements up front.
Interfund loans and transfers secured by tax increments or tax abatements may be used when there is an
extraordinary capital requirement that cannot be met through conventional private debt and/or equity, and
to benefit a project of high priority and interest to the City.
Bonds secured by tax increments or tax abatements may be issued only when there is an extraordinary
capital requirement that cannot be met through conventional private debt and/or equity, and to benefit a
2

22

project of high priority and interest to the City. The bonds may be general obligation bonds backed by the
full faith and credit of the City.
VII.

TERM OF ASSISTANCE

The EDA retains the ability to provide a shorter term for the tax increment or tax abatement than the
Minnesota Tax Increment Act and Minnesota Tax Abatement Act, respectively.
VIII.

BUSINESS ASSISTANCE PROJECT APPROVAL CRITERIA

All new projects approved by the EDA must meet the following mandatory minimum approval criteria.
However, it should not be presumed that the business assistance request of a project meeting these criteria
will automatically be approved. Meeting these criteria creates no contractual rights on the part of any
potential developer.
1. The assistance shall be provided within applicable state legislative restrictions, State Auditor
interpretation, debt limit guidelines, and other appropriate financial requirements and
policies.
2. The project should meet one or more of the goals referenced in the City’s Strategic Plan.
3. The project must be in accord with the City’s Comprehensive Plan and Zoning Ordinances, or
if amendments are required the approved is conditioned on obtaining the approvals.
4. project must be in accord with
5. Prior to approval of business assistance, the developer shall provide any required market and
financial feasibility studies, appraisals, soil boring, information provided to private lenders
for the project, and other information or data that the City or its financial consultants may
require in order to proceed with an independent underwriting.
6. Any developer requesting business assistance should be able to demonstrate past successful
general development capability as well as specific capability in the type and size of
development proposed.
7. The developer must retain ownership of the project at least long enough to complete it, to
stabilize its occupancy, to establish the project management, and to initiate repayment of the
business assistance.
8. The level of business assistance funding should be reduced to the lowest possible level and
least amount of time by maximizing the use of private debt and equity financing first, and
then using other funding sources or income producing vehicles that can be structured into the
project financing, prior to using additional business assistance funding.
IX.

BUSINESS ASSISTANCE PROJECT EVALUTATION CRITERIA

If a business meets the criteria in Section 4 and is eligible for assistance, the following criteria will be
used to determine the amount of assistance and type of assistance that may be provided. All projects will
be evaluated by the Economic Development Authority for the City of Forest Lake on the following
criteria for comparison with other proposed business assistance projects reviewed by the EDA, and for
comparison with other subsidy standards (where appropriate). It is realized that changes in local markets,
3

23

costs of construction, and interest rates may cause changes in the amounts of business assistance subsidies
that a given project may require at any given time. In applying the criteria to a specific project, the
following will apply:
The EDA may consider the requirements of any other business subsidy received, or to be received, from a
grantor other than the EDA.
1. If the business subsidy is a guaranty, the amount of the business subsidy may be valued at the
principal amount of the guaranteed payment obligation.
2. If the business subsidy is real or personal property, the amount of the subsidy will be the fair
market value of the property as determined by the EDA.
3. If the business subsidy is received over time, the EDA may value the subsidy as it determines
is fair and reasonable under the circumstances.
4. As used herein, “Benefit Date,” means the date the business subsidy is received. If the
business subsidy involves the purchase, lease, or donation of physical equipment, then the
benefit date occurs when the recipient puts the equipment into service. If the business subsidy
is for improvements to property, then the Benefit Date refers to the earliest date of either
when the improvements are finished for the entire project or when a business occupies the
property.
5. All business assistance projects will need to meet a “Reasonable Rate of Return.” Assistance
will not be used unless the need for the EDA 's economic participation is sufficient that,
without that assistance the project could not proceed in the manner as proposed. The
Reasonable Rate of Return will be based on market standards at the time of the application
for assistance.
6. Business assistance will not be used when the developer's credentials, in the sole judgment of
the EDA, are inadequate due to past track record relating to: completion of projects, general
reputation and/or bankruptcy, or other problems or issues considered relevant by the EDA.
7. Business assistance funding should not be provided to those projects that fail to meet good
public policy criteria as determined by the Board including: poor project quality; projects that
are not in accord with the City’s comprehensive plan, zoning, redevelopment plans, and City
policies; projects that provide no significant improvement to surrounding land uses, the
neighborhood, and/or the City; projects that do not meet one or more of the goals referenced
in the City’s Strategic Plan; projects that do not meet financial feasibility criteria established
by the City; and projects that do not provide the highest and best desired use for the property.
8. All projects receiving business assistance under the criteria listed in Minnesota Statutes
116J.993, Subd. 3 must meet the job and wage goals described below. Minnesota Statutes
116J.994, Subd. 2 allows the EDA to deviate from its criteria by documenting in writing the
reason for the deviation and attaching a copy of the document to its next annual report to the
Department of Employment and Economic Development.
Projects receiving business assistance must create or maintain a minimum of 1 full time job
paying an average wage of 150% of Federal minimum wage, including benefits.
9. The amount of assistance available to a project will be limited by the amount of proceeds that
4

24

TIF or other financing tools may support.
10. Job creation or retention is not required for businesses subsidies as long as the grantor
identifies an alternate public purpose in addition to tax base increase. If after Council
consideration of the alternate public purpose(s) proposed, the creation or retention of jobs is
determined not to be a goal, the wage and job goals may be set at zero.
11. In lieu of job creation or retention, other measurable, specific, and tangible goals shall be
established. Examples of tangible goals may include tax base diversification, property
redevelopment, enhanced economic diversity, community stabilization, investment in the
community and/or other goals identified in the City’s Strategic Plan and City’s
Comprehensive Plan.
12. Business assistance will normally be used for projects that address the following land use
issues: (1) high value development consistent with the City’s Comprehensive Plan; (2)
location on property which needs but is not likely to be developed or redeveloped because of
blight or other adverse conditions of the property; and possibly (3) the inclusion of design
and/or amenity features not otherwise required by law.
13. Business assistance will be evaluated on the project’s impact on existing and future public
investment: (1) whether and to what extent the project will utilize existent public
infrastructure capacity and the extent it requires additional publicly funded infrastructure
investments; (2) arrangements for the EDA to receive a direct monetary return on its
investment in the project.
14. Business assistance will normally be used for projects that demonstrate to the satisfaction of
the EDA adequate financing for the project is available and that the project will be completed
in a timely fashion.
15. Business assistance from the EDA must satisfy all requirements of Minnesota Statutes
116J.993 through 116J.995.
X.

LOOK BACK PROVISION

The EDA reserves the ability to include a Look Back Provision in the Development Agreement for a
project. Under the Look Back Provision, the EDA has the ability to review the development proforma and
grant assistance based on the estimates for the project. After completion of the project, the EDA has the
ability to compare the actual project costs and performance with the estimates and adjust the assistance
provided so a “Reasonable Rate of Return” is achieved. This adjustment will be made only in
circumstances when the business subsidy can be reduced to achieve a “Reasonable Rate of Return.” The
adjustment will not be made to increase the amount of the business subsidy.
At the time the Development Agreement is being negotiated, the EDA will consider if and how any
assistance above the “Reasonable Rate of Return” may be shared.
Some criteria, by their very nature, must remain subjective. However, wherever possible "benchmark"
criteria have been established for review purposes. The fact that a given proposal meets one or more
"benchmark" criteria does not mean that it is entitled to funding under this policy, but rather that the City
is in a position to proceed with evaluations of (and comparisons between) various business assistance
proposals, using uniform standards whenever possible.

5

25

________________________________
Mayor

6

26

APPENDIX A
The Business Subsidies Statutes specifically exclude 22 items from the definition. The following are NOT
business subsidies:
•
•
•
•
•
•
•
•
•
•
•

•
•
•

•
•
•
•
•
•
•
•

A business subsidy of less than $150,000;
Assistance that is generally available to all businesses or to a general class of similar businesses,
such as a line of business, size, location, or similar general criteria;
Public improvements to buildings or lands owned by the state or local government that serve a
public purpose and do not principally benefit a single business or defined group of businesses at
the time the improvements are made;
Redevelopment property polluted by contaminants as defined in M.S. Section 116J.552, Subd. 3;
Assistance provided for the sole purpose of renovating old or decaying building stock or bringing
it up to code and assistance provided for designated historic preservation districts, provided that
the assistance is equal to or less than 50% of the total cost;
Assistance to provide job readiness and training services if the sole purpose of the assistance is to
provide those services;
Assistance for housing;
Assistance for pollution control or abatement, including assistance for a tax increment financing
hazardous substance sub-district as defined under M.S. Section 469.174, Subd. 23;
Assistance for energy conservation;
Tax reductions resulting from conformity with federal tax law;
Workers' compensation and unemployment compensation;

Benefits derived from regulation;
Indirect benefits derived from assistance to educational institutions;
Funds from bonds allocated under chapter 474A, bonds issued to refund outstanding bonds, and
bonds issued for the benefit of an organization described in section 501 (c) (3) of the Internal
Revenue Code of 1986, as amended through December 31, 1999;
Assistance for a collaboration between a Minnesota higher education institution and a business;
Assistance for a tax increment financing soils condition district as defined under M.S. Section
469.174, Subd. 19;
Redevelopment when the recipient's investment in the purchase of the site and in site preparation
is 70 percent or more of the assessor's current year's estimated market value;
General changes in tax increment financing law and other general tax law changes of a
principally technical nature;
Federal assistance until the assistance has been repaid to, and reinvested by, the state or local
government agency;
Funds from dock and wharf bonds issued by a seaway port authority;
Business loans and loan guarantees of $150,000 or less; and
Federal loan funds provided through the United States Department of Commerce, Economic
Development Administration.

27

APPENDIX B
CITY OF FOREST LAKE
BUSINESS ASSISTANCE FINANCING APPLICATION

Legal name of applicant:

Address:

Telephone number:

Name of contact person:
REQUESTED INFORMATION
Addendum shall be attached hereto addressing in detail the following:
1. A map showing the exact boundaries of proposed development.
2. Give a general description of the project including size and location of building(s); business
type or use; traffic information including parking, projected vehicle counts and traffic flow;
timing of the project; estimated market value following completion.
3. The existing Comprehensive Plan Land Use designation and zoning of the property. Include a
statement as to how the proposed development will conform to the land use designation and
how the property will be zoned.
4. A statement identifying how the assistance will be used and why it is necessary to undertake
the project.
5. A statement identifying the public benefits of the proposal including estimated increase in
property valuation, new jobs to be created, hourly wages and other community assets.
6. A written description of the developer’s business, principals, history and past projects
I understand that the application fee will be used for City staff and consultant costs and may be partially
refundable if the request for assistance is withdrawn. Refunds will be made at the discretion of the City
Council and be based on the costs incurred by the City prior to the withdrawal of the request for
assistance. If the initial application fee is insufficient, I will be responsible for additional deposits.
SIGNATURE
Applicant's signature:

Date:

28

CITY OF FOREST LAKE
Application for Business Assistance Financing

GENERAL INFORMATION:
Business Name:

Date:

Address:
Type (Partnership, etc.):
Authorized Representative:

Phone:

Description of Business:

Legal Counsel:
Address:

FINANCIAL BACKGROUND:
1.

Have you ever filed for bankruptcy?

2.

Have you ever defaulted on any loan commitment?

3.

Have you applied for conventional financing for the project?

4.

List financial references:
a.
b.
c.

Phone:

29

5.

Have you ever used Business Assistance Financing before?
If yes, what, where and when?

PROJECT INFORMATION:
1.

Location of Proposed Project:

2.

Amount of Business Assistance requested?

3.

Need for Business Assistance:

4.

Present ownership of site:

5.

Number of permanent jobs created as a result of project?

6.

Estimated annual sales:

7.

Market value of project following completion:

8.

Anticipated start date:

Present:

Future:

Completion Date:

FINANCIAL INFORMATION:
1.

Estimated project related costs:
a.

land acquisition

b.

site development

c.

building cost

d.

equipment

e.

architectural/engineering fee

f.

legal fees

g.

off-site development costs

Total:

$

30

2.

Source of financing:
a.

private financing institution

b.

requested public assistance funds

c.

other public funds

d.

developer equity

$

Total:

PLEASE INCLUDE:
1.
2.
3.
4.
5.
6.
7.

Preliminary financial commitment from bank
Plans and drawing of project
Background material of company
Development budget (sources and uses of funds)
Operating pro forma analysis (minimum of 10 years)
Personal and/or corporate financial statements, as applicable
Statement of property ownership or control

2023
Draft
31

City of Forest Lake and
Forest Lake Economic Development Authority
Business Subsidy Criteria and Public Financing Policy
INTRODUCTION:
This Policy is adopted for purposes of the business subsidies act, pursuant to Minnesota
Statutes, Sections 116J.993 through 116J.995, as amended (the “Statutes”). Terms used
in this Policy are intended to have the same meanings as those used in the Statutes.
Subdivision 3 of the Statutes specifies forms of financial assistance that are not
considered a business subsidy. This list contains exceptions for several activities,
including redevelopment, pollution clean-up, and housing, among others. By providing a
business subsidy, the city commits to holding a public hearing, as applicable, and
annually reporting to the Department of Employment and Economic Development
(“DEED”) on job and wage goal progress if and when required by the Statutes.
1.

PURPOSE AND AUTHORITY:
A.

The purpose of this document is to establish criteria for the City of Forest
Lake (the “City”) and the Forest Lake Economic Development Authority (the
“EDA”) for the granting of business assistance and public financial
assistance for private development within the City. As used in this Policy,
the term “City” shall be understood to include the EDA. The criteria outlined
in this Policy shall be used as a guide in processing and reviewing
applications requesting business assistance and/or City public financial
assistance. As used in this Policy, the term business assistance includes,
but is not limited, assistance constituting a “business subsidy” under the
Statutes.

B.

The City's ability to grant business assistance is governed by the limitations
established in the Statutes and other provisions of Minnesota law. The City
may choose to apply the criteria contained herein to other development
activities not covered under the Statutes. City public financial assistance
may or may not be considered a business subsidy as defined by the
Statutes.

C.

Business assistance include grants by state or local government agencies,
contributions of personal property, real property, infrastructure, the principal
amount of a loan at rates below those commercially available to the
recipient of the assistance, any reduction or deferral of any tax or any fee,

DRAFT Forest Lake Business Subsidy Criteria and Public Financing Policy

Page 1

32

tax increment financing (TIF), abatement of property taxes, loans made
from City funds, any guarantee of any payment under any loan, lease, or
other obligation, or any preferential use of government facilities given to a
business. Certain types of business assistance may not be considered
business subsidies under the Statutes.

2.

D.

The criteria contained herein shall be used in conjunction with other relevant
policies of the City. Compliance with the Policy shall not automatically mean
compliance with such separate policies.

E.

The City, at its sole discretion, may deviate from the job and wage goals
criteria outlined in Section 5 D, E, and F below by documenting in writing
the reason(s) for the deviation. The documentation shall be submitted to
DEED with the next annual report.

F.

The City may amend this document at any time. Amendments to this Policy
are subject to public hearing requirements contained in the Statutes.

CITY’S OBJECTIVE FOR THE USE OF PUBLIC FINANCING:
A.

As a matter of adopted policy, the City may consider using public financial
assistance which may include tax increment financing (TIF), tax abatement,
and other forms of public financing as appropriate, to assist private
development projects. Such assistance must comply with all applicable
statutory requirements and accomplish one or more of the following
objectives:
1.

Remove blight and/or encourage redevelopment in designated
redevelopment/development area(s) per the goals and visions
established by the City.

2.

Expand and diversify the local economy and tax base.

3.

Directly or indirectly leverage investment in infrastructure in the City.

4.

Encourage additional unsubsidized private development in the area,
either directly or through secondary “spin-off” development.

5.

Offset increased costs for redevelopment over and above the costs
that a developer would incur in normal urban and suburban
development (determined as part of the But-For analysis).

6.

Facilitate the development process and promote development on
sites that could not be developed without this assistance.

DRAFT Forest Lake Business Subsidy Criteria and Public Financing Policy

Page 2

33

3.

7.

Retain local jobs and/or increase the number and diversity of quality
jobs.

8.

Provide opportunities for small businesses and/or entrepreneurs and
promote resident economic stability.

9.

Further diversity, equity, and inclusion goals.

10.

Increase housing choice.

11.

Meet other uses of public policy, as adopted by the City from time to
time, including but not limited to promotion of quality architectural
design, energy conservation, sustainable building practices, and
decreasing the capital and operating costs of local government.

PUBLIC FINANCING PRINCIPLES:
A.

The guidelines and principles set forth in this document pertain to all
applications for City public financial assistance regardless of whether they
are considered a Business Subsidy as defined by the Statutes. The
following general assumptions of development/redevelopment shall serve
as a guide for City public financial assistance:
1.

All complete applications for City public financial assistance shall be
reviewed by staff and a third-party financial advisor who will inform
the City of its findings and recommendations. This process, known
as the “But For” analysis is intended to determine if the project would
not be feasible but for the City assistance.

2.

City staff and a third-party financial advisor will prepare a
memorandum for the City Council and EDA documenting the “But
For” test has been met.

3.

The City shall establish mechanisms within the development
agreement to ensure that adequate checks and balances are
incorporated in the distribution of financial assistance where feasible
and appropriate, including but not limited to:
a. Establishment of “look back provisions.”
b. Establishment of minimum assessment agreements
c. Documentation of all costs

4.

TIF and abatement will be provided on a pay-as-you-go-basis. Any
request for upfront assistance will be evaluated on its own merits and
may require security to cover any risks assumed by the City.

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4.

5.

The City may set up TIF districts in accordance with the maximum
number of statutory years allowable; however, this does not mean
that the applicant will be granted assistance for the full term of the
district.

6.

The City shall elect to have the fiscal disparities contribution come
from inside applicable TIF district(s) to eliminate any impact to the
existing tax payers of the community.

7.

Public financing will not be used in projects that would give a
significant competitive financial advantage over similar projects in
the area due to the use of public subsidies. Applicants should be able
to supply information to support that City public financial assistance
will not create such a competitive advantage.

8.

Public financial assistance will not be used in a project that involves
a land and/or property acquisition where the price is in excess of the
fair market value.

9.

The applicant shall pay all applicable application fees and pay for the
City’s fiscal and legal advisor time as stated in the Local Public
Financial Assistance Application.

10.

The City may consider waiving fees, but will not waive SAC and WAC
fees.

11.

The applicant shall proactively attempt to minimize the amount of
public assistance needed through the pursuit of grants, innovative
solutions in structuring the deal, and other funding mechanisms.

12.

All developments are subject to execution and recording of a
Minimum Assessment Agreement.

PROJECTS WHICH MAY QUALIFY FOR PUBLIC FINANCING ASSISTANCE:
A.

All new applications for public financial assistance that are considered by
the City must meet each of the following minimum qualifications. However,
it should not be presumed that a project meeting these qualifications will
automatically be approved for assistance. Meeting the qualifications does
not imply or create contractual rights on the part of any potential applicant
to have its project approved for assistance.

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4.1

4.2

MINIMUM QUALIFICATIONS/REQUIREMENTS:
A.

In addition to meeting the applicable requirements of State law, the project
shall meet more than one of the public financing objectives outlined in Sec.
2.

B.

The applicant must demonstrate to the satisfaction of the City that the
project is not financially feasible “but for” the use of public financial
assistance.

C.

The project is, or will be through the City approval processes, consistent
with the Comprehensive Plan, Zoning Ordinances, Design Guidelines or
any other applicable land use documents of the City.

D.

Prior to approval of a financing plan, the applicant shall provide any
requested market and financial feasibility studies, appraisals, soil borings,
private lender commitment, and/or other information the City or its financial
advisors may require to proceed with an independent evaluation of the
proposal.

E.

The applicant must provide adequate financial guarantees to ensure the
repayment of any public financing and completion of the project. These may
include, but are not limited to, assessment agreements, letters of credit,
personal deficiency guarantees, guaranteed maximum cost contract, etc.

F.

Any applicant requesting public financial assistance must be able to
demonstrate a previous capability for successful development, as well as
specific capability regarding the type and size of the development proposed.
Public financing shall not be used when the applicant’s credentials, in the
sole judgment of the City, are inadequate due to previous history relating to
completion of projects, general reputation, and/or bankruptcy, or other
problems or issues considered relevant to the City.

G.

The applicant, or its contractual assigns, shall retain ownership of any
portion of the project long enough to complete it, stabilize its occupancy,
establish project management and/or needed mechanisms to ensure
successful operation.

DESIRED QUALIFICATIONS:
A.

Projects providing a high ratio of private investment compared to City public
investment. Private investment includes developer cash, government and

DRAFT Forest Lake Business Subsidy Criteria and Public Financing Policy

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36

bank loans, conduit bonds, tax credit equity, and land if already owned by
the applicant.
B.

Projects that significantly increase the amount of property taxes paid after
redevelopment.

C.

Projects that add needed public infrastructure such as roads, utilities,
stormwater or structured parking.

D.

Projects that encourage the following:
1.

Implements the City’s vision and values for a City-identified
redevelopment area.

2.

Provides significant improvement to surrounding land uses,
neighborhoods, and/or the City.

3.

Attracts or retains an employer within the City.

4.

Provides increased quality and higher paying jobs that are over
200% of State Minimum Wage.

5.

Provides significant improvement to surrounding land uses,
neighborhoods, and/or the City.

6.

Attracts or retains an employer within the City.

7.

Promotes housing investment that meets the following City goals:
i.
ii.

Provides for investment in public infrastructure necessary to
support new housing.
Increase housing choice and affordability within the community;
diversify existing housing stock; and provide options that do not
currently exist.

8.

Provides opportunities for small businesses and/or entrepreneurs.

9.

Projects that promote resident economic stability.

10.

Redevelops a blighted, contaminated and/or challenged area.

11.

Preserves and/or stabilizes a major commercial or industrial node.

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5.

6.

BUSINESS SUBSIDY PUBLIC PURPOSE, JOBS AND WAGE REQUIREMENT:
A.

All business assistance must meet a public purpose with measurable
benefit to the City as a whole.

B.

Job retention may only be used as a public purpose in cases where job loss
is specific and demonstrable. The City shall document the information used
to determine the nature of the job loss.

C.

The creation of tax base shall not be the sole public purpose of a subsidy.

D.

Unless the creation of jobs is removed from a particular project pursuant to
the requirements of the Statutes, the creation of jobs is a public purpose for
granting assistance.

E.

For purposes of this Policy, full time equivalent (FTE) jobs must be
permanent positions with set hours and be eligible for benefits. part-time
equivalent jobs may receive a partial credit and be counted toward the job
goals.

F.

The wage floor for wages to be paid for the jobs created shall be not less
than 150% of the State Minimum Wage. The City will seek to create jobs
with higher wages as appropriate for the overall public purpose of the
assistance. Wage goals may also be set to enhance existing jobs through
increased wages, which increase must result in wages higher than the
minimum under this Section.

G.

After a public hearing, if the creation or retention of jobs is determined not
to be a goal, the wage and job goals may be set at zero.

SUBSIDY AGREEMENT:
A.

In granting a business assistance, if required by the Statutes, the City shall
enter into a subsidy agreement with the recipient that provides the following
information:
1.

Wage and job goals (if applicable).

2.

Commitment to provide necessary information for reporting
purposes.

3.

Five-year operation commitment after the benefit date.

4.

Recourse for failure to meet goals required by the Statutes.

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7.

B.

The subsidy agreement may be incorporated into a broader development
agreement for a project.

C.

The assistance agreement will commit the recipient to provide the reporting
information required by the Statutes, if any.

D.

For assistance that does not constitute a business subsidy under the
Statutes, the grantee and the City or the EDA will enter into an agreement
setting forth the terms of the assistance.

PUBLIC FINANCING PROJECT EVALUATION PROCESS:
A.

The following process and methods of analysis will be used for all public
financing proposals:
1.

The applicant must complete and submit Forest Lake’s Public
Financing Application (the “Application”) along with their required
content and remit the required Application fee.
a. The Application must be accompanied by a concept plan that
includes, at minimum, the following:
i. Site plan and landscaping plan
ii. Building floor plans
iii. Building elevations
iv. Required fees and escrows, as adopted per the City’s fee
schedule

2.

Once the Application is submitted and deemed complete, City staff
and a third-party financial advisor will review to ensure the
following:
a. The project is deemed consistent with City’s Goals and
Objectives
b. The project meets the minimum qualifications of the Policy
c. The project meets desired qualifications.
d. The project meets “but-for” analysis and/or statutory
qualifications.

3.

City staff, legal, and financial advisors will prepare a non-binding
Term Sheet outlining the details and conditions of any public
assistance
a. The Economic Development Authority will review the Term
Sheet and make a recommendation to the City Council

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b. The City Council will consider approval of the Term Sheet at a
subsequent meeting
4.

If the Term Sheet is approved by City Council, the developer shall
make an additional $10,000 escrow deposit to cover City/EDA
attorney and consultant costs incurred as part of establishing a TIF
district or abatement, drafting and negotiating a development
agreement, and conducting any fiscal analysis that may be required
to meet the requirements of utilizing any public financing. If
additional expenses are incurred beyond the initial deposit, prior to
the execution of a development agreement, the City/EDA shall
notify the applicant in writing and the applicant will be required to
deposit additional funds upon notice.

5.

Upon receipt of the initial escrow deposit, city staff will begin the
process of establishing new TIF district or abatement and drafting
the necessary legal documents.

Please note that the evaluation methodology is intended to provide a
balanced review. Each area will be evaluated individually and collectively
and in no case should one area outweigh another in terms of importance to
determining the level of assistance.

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STAFF REPORT
MEETING DATE:

May 4, 2026

TO:

President Leif Erickson and EDA Members

STAFF ORIGINATOR: Abbi Wittman, Community Development Director
AGENDA ITEM:

Draft 2025 Community and Economic Development Report

______________________________________________________________________________
INTRODUCTION:
Last year City staff produced its first Community and Economic Development Report. Enclosed is
an updated (2025) version for the EDA. The updated version includes additional information
about programs now a part of the Department (i.e. Building Inspection and Code Enforcement)
as well as a brief amount of information provided by the Chamber in their annual report. The
draft Report is enclosed for EDA review, discussion and direction.
ANALYSIS:
When the EDA received the first 2024 Report, the EDA indicated they were appreciative to see
the information condensed in a single document and requested additional information be in
subsequent reports. While adding this additional information is helpful to understand the
Community Development Department’s functions and will help serve as a reference point for
growth over time, staff questions if the Report could also serve as a community showcase.
When comparing the City’s Report to other communities (such as Blaine, Hastings, and
Woodbury), it is clear some communities use these reports for broader public education
purposes.
Staff would like the EDA’s feedback on the report and if additional information should be
included in the report. Additionally, the EDA should discuss if the EDA would like to use this for
greater public education and, if so, if the EDA is interested in understanding what the costs
would be to have a professional marketing firm assist with finalizing the document. While the
EDA does not have funding specific to marketing, staff anticipate the EDA will have a fund
balance at the end of the year. These funds ‘carryover’ for future economic development
efforts and, as such, there is sufficient reserve that could be used.
RECOMMENDATION:
Staff request the EDA discuss the draft Report and provide direction.
ATTACHMENTS:
Draft 2025 Community and Economic Development Report

41

DRAFT
Annual
Report

42

City Map
Overview
Land Use Changes

Department Functions
Organizational Chart/Job Duties

Top Projects by Valuations
New Residential Counts

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Community and Economic Development Annual Report

43

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Community and Economic Development Annual Report

44

Located in the northern Twin Cities metro area, Forest Lake is home to a combination of strong
retail centers, robust business park, a quaint and welcoming downtown, and a wide array of
services that support our growing population and expanding businesses – all surrounded by an
abundance of natural beauty.
Strategically located where I-35W and I-35E merge, easily accessible to Minneapolis/St.
Paul and a gateway to Northern Minnesota
Population and households projected for continued growth
80% of the community workforce are well trained and educated
Strong reputation for K-12 public and private education opportunities
Commercial and industrial properties are readily available
Home to an expanding airport with available commercial lease prospects
Abundant
surroundings of
lakes, parks,
trails, golf
courses, and
beaches.
Expansive variety
of recreational
and wellness
opportunities.
Renowned
community
celebrations,
summer concerts
and market
events.

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Community and Economic Development Annual Report

45

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Community and Economic Development Annual Report

46

o 20,605
o Expected growth: 21,535 by 2030
o Growth rate of .89%

o Average Household Income: $122,137
o Projected to be $132,651 in 2030
o 8,805 Housing Units:
 5,913 owner-occupied
 2,483 rented
 409 vacant
o Average Home Value: $493,909

o
o
o
o
o

5|Page

747 businesses
8,843 employed workers
10,894 labor force aged 16+
5,320 workers commute from outside county or state
5,410 residents both live and work in/around Forest Lake

Community and Economic Development Annual Report

47

The City completed
construction of a new
park at 11th Ave SE and
South Shore Drive. Beltz
Park opened to the public
in the Fall of 2025. This
newly designed park offers
a multitude of amenities
including tennis courts,
basketball court, sand
volleyball court, skating
rink and warming house.
Additional features
provide an expansive
playground, picnic shelters
and tables, bench seating, restrooms and open space.

Working closely with Forest Lake city staff, the Veterans Memorial Committee increased
efforts to revamp the veterans memorial site located at Lakeside Memorial Park. The
existing memorial, honoring both living and deceased military veterans, is projected to be
significantly enhanced to include a
newly featured raised bronze statue
centerpiece surrounded by
memorialized pavers. The addition
of a large US flag pole will highlight
the new memorial site. The
committee welcomed donations
from the public along with three
grants awarded for project costs.
With the addition of continued
ongoing paver orders, which are
dedicated at annual Memorial Day
and Veteran’s Day services, the
impressive memorial site will stand
as a legacy for past and future
generations.
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48

In 2025 the the City’s Community (and Economic) Development department was restructured
by migrating the Building Inspections division from the Fire Department. Combining Building
permitting and inspections with planning and zoning creates a more unified and efficient
development review process. This reinvestment has improved coordination among staff,
streamlined application review, and enhanced service delivery. Continued growth and process
refinement remain a priority in the coming years.
Despite bringing its staffing levels to those of 2014, the Department continues to contract some
development review and inspection services. These services will remain in effect while
vacancies exist, and development demand intensifies. Additionally, while select Building
Inspections staff continue to respond to local emergencies as needed, service refinement and
coordination with the Fire Department is ongoing, ensuring appropriately aligned service
delivery.
Additionally, this year the City established its first dedicated Code Enforcement Officer position.
This role focuses exclusively on responding to and resolving property-related complaints. This
position is an integral member of the Department, helping maintain community safety,
appearance, and overall quality of life.

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49

Economic Development staff support developers, businesses, and real estate
professionals in identifying sites and buildings to grow business in Forest Lake. Staff
assist with redevelopment, expansion, financing, and funding opportunities. In
partnership with the Economic Development Authority, staff help attract investment
and strengthen the local economy.
All land use projects begin with Planning and Zoning. Community Development
processes applications for residential, commercial, and industrial development, as well
as redevelopment and a range of land use requests. Each application is reviewed for
compliance with applicable City ordinances and State statutes. Final decisions are
made by the Forest Lake City Council, Planning Commission, or City staff, in accordance
with established regulatory authority.
Following approval of development and land use applications, projects transition to the
Building Department. Building permits must be obtained, and all required inspections
completed, in accordance with the Minnesota State Building Code and Forest Lake City
Code. These requirements ensure compliance with safety, fire, and structural
standards. No construction may begin until all required approvals have been secured.
Property owners are required to comply with the Forest Lake City Code. These
regulations are designed to protect residents and the public from hazardous conditions
and property nuisances, with standards varying based on permitted property use.
When complaints are received, the City’s Code Enforcement Officer works directly with
property owners to achieve compliance and resolve issues in a timely and effective
manner. owner to ensure that violations are remedied and the property gains
compliance with appropriate City Ordinances.

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50

Community
Development Director
(Abbi Wittman)
Asst. CD Director

Building Official

(Steven Gilmore)

(Jason Wagner)

Michael Birchland

Building Inspector

(Planner)

(Nate Moats)

Consulting Planners
(Bolton and Menk)

Consulting Inspectors
(SAFEBuilt)

Administrative Assistant

Building Inspector

(Dawn Bugge)

(Vacant)

Code Enforcement
Officer
(Dan Pearson)

Fire/Permit Technician
(John Marshall)

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51

The following projects represent the highest-value non-residential investments completed in
2025, reflecting continued reinvestment in education, community facilities, and local
businesses.
•

Forest Lake High School
6101 Scandia Trail N — $6,800,000

•

Forest Lake Area Community School
943 9th Avenue SW — $4,607,571

•

American Legion
355 Broadway Avenue W — $548,000

•

U.S. Bank
320 Broadway Avenue W — $280,000

•

Dunkin’ Donuts
1420 Lake Street S, Suite 100 — $225,000

2023

2024

2025

$38,798,672

$31,990,409

$21,915,997

Total three-year investment: $92.7 million

55 Single family homes

6 Townhouse buildings (30 units)

2023

2024

2025

$23,231,648

$33,100,563

$41,840,719

Total three-year investment: $98.2 million
Average New Single-Family Home Valuation: $338,729

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Hidden Creek continued its buildout with approval of the Second and Third Additions,
adding 37 and 48 single-family homes, while advancing the Hidden Creek South Preliminary
Plat proposing 171 additional homes. Together, these phases represent a total of 256 new
single-family dwellings, supporting continued residential growth consistent with the
Comprehensive Plan and expanding infrastructure, park dedication, and neighborhood
connectivity within the Headwaters development area.

Havenwood (formerly Chestnut Creek Phase 2) advances the next phase of the Chestnut
Creek neighborhood, with the final plat proposing phased development of 116 planned
single-family lots, with 63 developed in the initial phase. The project delivers a range of
housing options and continues the broader buildout of the area, highlighted by a highly
anticipated neighborhood park featuring play equipment and gathering space; an
important, community-driven amenity that enhances livability, connectivity, and long-term
neighborhood character.

Amberly Woods advances a new residential neighborhood with approval of a Final Planned
Unit Development and Final Plat for 56 single-family homes on approximately 39 acres,
located east of Goodview Avenue N between 205th and 207th Streets N. A defining feature
of the project is the dedication of nearly 20 acres of land for park and open space, creating a
significant opportunity to support a future regional park amenity and expand the
community’s recreational system. The development thoughtfully balances housing growth
with environmental preservation while extending infrastructure, trails, and neighborhood
connectivity in this part of the city.

Between 2023 and 2026, the City maintained a steady pace of general permitting activity,
issuing approvals for a wide range of residential and zoning-related improvements. This
included over 300 residential remodels, nearly 100 decks, around 70 new sheds, along with
more than 100 fence permits and about 20 driveway permits supporting ongoing property
improvements. Additional permits included roughly 45 certificates of compliance (including
about 15 for keeping of chickens) and nearly 140 signs, reflecting both business activity and
unique residential uses. Collectively, these permits highlight continued investment by
residents and businesses in maintaining, enhancing, and personalizing properties
throughout the community.
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The City’s Code Enforcement program plays a vital role in preserving community standards,
safety, and quality of life. The Code Enforcement Officer promptly responds to property
maintenance and safety concerns reported through the City’s online portal, as well as via email,
phone, and in-person visits to City Hall.
Each case begins with a thorough site inspection to verify the concern, followed by a structured
and transparent communication process. Property owners receive formal notifications outlining
required actions and clear timelines to achieve compliance with City Ordinances. When
necessary, citations are issued to reinforce these standards and ensure accountability.
In situations involving urgent safety risks or ongoing noncompliance, the City takes decisive
action through abatement services to protect the public and surrounding properties. While
many property owners respond cooperatively and resolve issues in a timely manner, the City
remains committed to addressing more complex cases to ensure that all properties meet
established safety and maintenance expectations.
Through this proactive and responsive approach, Code Enforcement helps maintain safe
neighborhoods, protect property values, and supports a high quality of life for all residents.
From June 2025 through December 2025, Code Enforcement opened a total of 149 cases to
address property complaints. In 2025, a total of 137 cases were closed. The following table
designates the variety of complaint types received.

COMPLAINT CASE TYPE

June – Dec 2025

# of New Cases
Opened

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Snow & Ice

Junk/Unsheltered
Storage

Vehicle
Related

Grass/Lawn
Related

Miscellaneous
Property Type

65

15

11

10

25

Community and Economic Development Annual Report

54

The City-owned Headwaters 123 site is south of Headwaters Parkway, between Highway 61 and
Fenway Avenue. After marketing it for a data center for many years, the City Council and Economic
Development Authority determined a data center is not a good fit. The City wants to explore other
uses that could better serve the neighborhood, including spaces to create jobs and increase tax
revenue. The Economic Development Authority will keep working on a plan and hopes to find a
development partner in 2026.

The Airport Business Park on Fenway Avenue, home to the Forest Lake Area School District Hockey
Arena, was built about 20 years ago. Since then, the City has focused on adding more industrial or
business park uses there. In 2025, the City started working with partners to find new uses that
better support the Fenway Athletic Complex. The City is now working with a local developer on
sports-focused spaces that could include food and drinks.

The Minnesota Technology Corridor is a regional economic development initiative along the I-35
corridor focused on attracting high-quality commercial and industrial growth across multiple cities,
including Forest Lake. A key focus area within this effort is the Elmcrest Avenue/24th
Avenue/Hornsby Street corridor, which serves as a major undeveloped spine for future
development but currently lacks consistent planning standards across jurisdictions. For Forest Lake,
this effort is intended to help guide future development, improve infrastructure coordination, and
position the city for long-term economic competitiveness along the corridor.

In preparation for future HWY 61 improvements, the Forest Lake EDA will revisit the 2012 Aesthetics
and Water Quality Study and incorporate elements of the 2022 Downtown Plan to create a blueprint
for traffic, safety, and development. Planning work is expected to begin in late 2026.

Every ten years, the City of Forest Lake updates its Comprehensive Plan, a 20-year guide for growth
and development covering land use, infrastructure, parks, and economic development. The next
update is due by the end of 2028. In 2026, the City will begin a community visioning process to help
shape the 2050 plan, using public engagement to guide future planning decisions.

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o

Open to Business – Open to Business provides free, confidential business counseling to
current and prospective entrepreneurs. Experienced consultants work with you to identify
challenges and opportunities, including financing, and tailor solutions to your business needs.

o

Commercial Improvement Incentive Program - The CIIP program offers commercial and
industrial property owners forgivable loans to improve the exterior of their structures and
properties.

o

First Generation Homebuyer Grant Program - The Washington County Community
Development Agency program provides $5,000 in grants to first-generation homebuyers
who participate in a partner program and purchase a home in Forest Lake.

o

Home Improvement Loans - We administer low-cost home improvement loans to help
eligible Forest Lake single-family homeowners afford critical repairs and keep their homes
in good shape. The programs focus on making homes safer to live in, easier to access, and
more energy- and water-efficient.

o

NewTrax - Newtrax provides a transportation circulator service to many seniors in Forest

o

Transit Link - Transit Link is a curb-to-curb minibus or van service for the public that

o

Transit Link On-Demand - Transit Link On-Demand rides are location-based, through

Lake on Wednesdays. This regularly scheduled transportation loop covers specifically
chosen stops to assist riders with their shopping, dining, and socialization needs.

operates on weekdays throughout the seven-county metropolitan area. It is a shared-ride
service, which requires advanced reservation.
the Metro micro app. This service is offered between 10:00 am and 2:00 pm on Tuesdays
and Thursdays.

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o

In 2025, the Forest Lake Area Chamber of
Commerce conducted business visits greater
than once every two weeks, meeting with
approximately one business each week. These
visits occur at the request of the business or as a
pop-in opportunity to learn about business
needs, showcase Chamber offerings, and
provide general information about the Forest
Lake Area.

o

Monthly ribbon cuttings are held monthly. These
are opportunities to show case business
milestones, achievements, and to welcome new
businesses to the Forest Lake area. Last year,
ribbon cutting celebrations were held for seven
new businesses, including Aztec Countertops
and Mike’s Discount Foods, pictured right.

o

The Forest Lake Area Chamber of Commerce
offers several community events including, but
not limited to, the annual Lakeside Memorial
Park easter egg hunt and street dance.
Additionally, the Chamber continues to help
support the City in the administration of Arts in
the Park, the City’s Tuesday night music concert
series.

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