Winona has promised over $4.2 million in additional city taxes to build a new road leading to Riverbend Business Park. A change in plans for funding the project may eliminate the need for voter approval.
The road, an extension of Louisa Street, would run along the eastern edge of the Menards and Mills Fleet Farm properties and cross Highway 61, improving access for the large retail stores and other businesses in the park.
On Monday, the City Council unanimously pledged to pay for half of the $8.4 million project with local debt and taxes if the Minnesota Legislature funds half of it as part of its 2014 bonding bill, another tax-funded source. Should the legislature decide to fund the project this year, the council has committed to funding half of it.
New plan: no
The council promised to match state funding for the project with city bonds. That is a slight change of plans from last fall, when the council specified that it planned to ask voters to approve a local sales tax to finance the Louisa Street extension.
City of Winona Port Authority Economic Development Director Lucy McMartin explained that a sales tax has not been ruled out. Bonds could be paid back either by collecting a new sales tax or by levying new property taxes. In either of those scenarios, the City Council would need voter approval for the new taxes. However, the city has another option that would not require voters' consent: the Winona Port Authority's special legal powers to bond for industrial development projects – and levy new property taxes to fund them – without a referendum.
McMartin said the city has not yet decided whether it will seek a referendum or use the Port Authority's special powers. No plans for seeking a referendum have been made.
If the state funds the project, the city is committed to providing its half, Mayor Mark Peterson agreed. "But there are options as far as how we do that: as far as the city bonding for it or the Port Authority bonding for it," he continued, noting the possibility of fulfilling the city's obligation without voter support. Two past attempts at referenda to fund the Louisa Street extension were rejected by voters.
State law grants the Port Authority special legal powers to borrow and tax without voter approval for projects within special areas known as Industrial Development Districts. While many of the businesses that occupy it are commercial, Riverbend Business Park is designated as an Industrial Development District, so the Port Authority could use its powers to bond for the project without voter approval.
If the city were to seek a referendum during elections this fall, it would need to announce the plans this spring.
Riverbend's controversial history
As noted above, the city has referred to Riverbend by many names: retail park, industrial park, technology park. It was intended as an industrial park that would bring high-paying manufacturing jobs to Winona, but much of the park has been filled by retail stores. For some, that is a sore subject.
In 1998, a majority of Winona voters agreed to a local half-cent sales tax and vehicle tax to fund a $4 million effort to dredge Lake Winona and infill the area east of Winona Health. Local ballots named it an industrial park and city leaders pledged new, high-paying jobs if voters approved the sales tax.
Later, Winona Post reports revealed that the City Council discussed development plans with officials from a national retail chain, breaking up into small groups in an apparent effort to avoid the requirements of the Open Meeting Law and the "big public bashing," as one council member put it, that would result.
Winona Post investigations also uncovered that the city collected an additional $1.35 million over the $4 million that voters authorized and which was needed for the project.
Why street extension?
The project has long been on the city's wish list. Given the traffic congestion at Highway 61 and Mankato Avenue, the project is badly needed, city staff and council members have argued. It is also a public safety concern, city leaders have stated, noting that if the Mankato Avenue and Highway 61 intersection were ever blocked, it would restrict access to Winona Health.
Council member George Borzyskowski called Mankato Avenue "a nightmare for police and fire" during a tour of the site this fall. "It is a safety issue," agreed council member Paul Double, adding, "maybe we can fix it before someone gets hurt or dies" because emergency services are blocked.
"The main reason is public safety," said City Manager Judy Bodway at the Monday meeting. Her comments were the only discussion prior to the unanimous vote.
Officials at city hall have long known an infrastructure fix was needed for the increased traffic at Riverbend Business Park. Planning for it began shortly after the park was finished. The Louisa Street project first surfaced as part of a 2003 city study called the Riverbend Retail Park Access Plan.
"Without that development, we wouldn't be there," Bodway said in a 2003 interview of planning new roadways accessing the business park. "All of this has come about because of development," former Mayor Jerry Miller agreed in a 2004 interview about the Louisa Street project.
City leaders are now putting less emphasis on improving access to retail businesses and focusing on other reasons for the project.
"I'm sure it's both," Peterson said of the need for retail access and emergency access. "The retail businesses are there and they're not going to disappear. They have certainly increased traffic as a result. This will help with that, especially truck traffic on Mankato Avenue as the trucks are servicing those businesses."
Traffic needs long expected
When the Riverbend Business Park first began to fill with large retailers in the early 2000s, state transportation officials recognized the strains increased commercial traffic would put on the current infrastructure.
A 2002 Minnesota Department of Transportation (Mn/DOT) report projected that a full Riverbend Business Park would "add approximately 3,100 peak-hour vehicle trips." This fall, city staff reported that traffic in the area has increased by 5,000 vehicle trips or 25 percent.
The Mn/DOT report also stated that "together, with growth in 'non-Riverbend' trips, traffic volumes on [highways] 61 and 43 are expected to grow between 2001 and 2020 by approximately 40 to 90 percent," with the largest increase on Mankato Avenue. The report concluded that Riverbend Business Park development would contribute to "unacceptable" traffic flow by 2020 unless improvements were made.
Increase in commercial traffic was a focal point of concerns at the time, according to the report. "The city believes heavy commercial traffic will use the new route, which in turn will provide relief to Mankato Avenue traffic congestion," Mn/DOT officials wrote of city plans for a street extension near Louisa Street.