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No referendum for $1.6M 'industrial' bike path, airport (07/07/2013)

Lake Park may soon be an industrial park, legally speaking. On Thursday, the city of Winona is expected to set the groundwork for a legal move that would cement the city's ability to borrow $1.6 million for renovations to the Lake Park bike path and municipal airport and levy more than $1.7 million in new property taxes without voter approval. Under a plan recommended by city staff, the Winona Port Authority would add the municipal airport to the Riverfront Industrial District, which encompasses Riverview Drive industries, and add Lake Park to the Riverbend Industrial Park, which includes large "big box store" retailers.

Under state law, port authorities have special powers to borrow for improvements to designated industrial and economic development spaces and and levy taxes to repay the debts without voter approval. Normally, the city would need a majority of voters to approve the $1.6 million bond and over $1.7 million levy.

1998 referendum

brings box retailers

In 1998, city voters approved a referendum to allow the city to collect $4 million from a half-cent sales tax and a $20 vehicle tax to dredge Lake Winona and use the material to fill an East End wetland area to be used as an industrial park. Advertised to voters as a way to draw new industrial development and with it, high-paying industrial jobs 58 percent of voters agreed to fund the project.

Once the area was filled and readied for development, however, much of the land ended up being used for retail stores.

In 2003, in what appeared to be an effort to avoid public discussions required by the Minnesota Open Meeting Law, the City Council divided into groups of three and met privately with representatives of Wal-Mart. According to council member George Borzyskowski at the time, the council met in small groups that excluded the public in order to avoid "a big public bashing." Soon, a Walmart store was constructed, despite a citizen petition against the retail giant, and much of the voter-funded "industrial park" was filled with big retail stores, parking lots and strip malls. City leaders eventually began referring to the area as "Technology Park," saving the "Riverbend Industrial Park" name for a smaller area, east of the home of the retail hub.

Some Winona residents and business owners objected to the land being used for commercial and retail development, asking that the city immediately change its zoning ordinance to prohibit commercial and retail development on the scant remaining tracts of industrial land. However, in 2010, the council instead further relaxed the rules for light manufacturing districts to make it easier to develop retail shops and restaurants within the city's light industrial zones. All of the city's industrial zones are open to retail development.

An investigative report in the Winona Post in 2003 showed that the city also collected more than was approved by the referendum vote for the special tax. Voters had approved the collection of $4 million, plus the interest expense to borrow the money for the projects up front. The city actually collected more than $5.35 million from taxpayers. City officials said the city collected the extra funds because it needed to provide the Minnesota Department of Revenue with 90 days notice that it would end the special tax, and the tax had to cease at the end of a quarter.

Commission needs council approval

The Winona Port Authority Commission does not need voter approval to bond for economic development projects, but it does need permission from the City Council to borrow and tax for the airport and bike path renovations. City staff has recommended that the Port Authority make a formal request for that permission on Thursday.

According to the Winona Port Authority Commission agenda, the Lake Park bike path overlay project would be considered an economic development project not subject to voter approval because it would "make Winona attractive to current and prospective businesses."

The Winona Port Authority Commission is expected to set a date for a public hearing for the plan to add the park and airport to industrial districts in August, but contracts for work on the two projects have already been signed, with promises from the commission to pay for the contracts using the yet-to-be approved bonds.

The commission meeting is Thursday, June 11, at 4 p.m. in the Wenonah Room on the second floor of City Hall. This meeting is open to the public. 


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