Regular readers of this site know that the state-wide Main Street Program was recently reborn in Minnesota and that the NDDC played a role in the restorative efforts.  Historic commercial districts in Greater Minnesota have faced many challenges in recent years and the time is right for another ally in this important work.

Minnesota Main Street, like the NDDC, will work in the Four Points of the National Trust’s Main Street Program.  All of us believe that a comprehensive approach to economic vitality is most likely to succeed.

The announcement of the program’s rebirth was Sauk Centre, scene of Sinclair Lewis’ “Main Street”.  It seems only appropriate that Northfield is the site of the group’s planning session.

Downtown Stakeholders, YOU ARE ALL INVITED…

…to an Open House, Wednesday, May 19, 2010, 4 to 6 p.m., at the Archer House River Inn.

The owners and workers are making improvements at the Archer House and they want to share their progress with you.  Help celebrate the new lobby and public areas as well as renovated Suites and Conference Room.

Hors d’ oeuvres, Wine, and Beer will be provided, all at the Archer House River Inn, 212 Division Street, in historic, scenic, authentic downtown Northfield, Minnesota.

For more information, see: www.archerhouse.com or call 507-645-5661/800-247-2235.

Earlier this month, the Preservation Alliance of Minnesota signed a contract with the National Main Street Center to officially launch Minnesota Main Street as the statewide coordinating program.  This action was taken based on an agreement with the Minnesota Historical Society for a $100,000 grant from the Minnesota Arts and Cultural Heritage Fund to finance this work.

Not that I’m claiming much credit for this impressive accomplishment.  Most of the work was performed by Preservation Alliance Executive Director Bonnie McDonald and much of the inspiration was generated by Steering Committee Chair Tim Griffin.  As usual, I worked to include the challenges and opportunities of downtown stakeholders in our discussions.  I will say that it has been an honor and a pleasure to work with Bonnie and Tim, as well as the rest of the often-changing membership of the committee.

As regular readers of this blog are aware, the Main Street Program focuses on Four Points: Organizing, Promoting, Designing, and (Economic) Restructuring.  We at the NDDC are hopeful that the re-establishment of the Main Street Program in Minnesota will support our efforts to strengthen our historic, scenic, and authentic downtown.

Commercial property taxes in downtown Northfield have risen over 300% in the past decade.  At their current levels, they are literally threatening the economic viability of our historic commercial district as well as undermining small business retention, expansion, and recruitment.

Last year, working with Senator Dahle and Representative David Bly, the NDDC saw legislation to help address the commercial property tax issue in older commercial districts throughout Greater Minnesota introduced in both the Senate and House.  With the challenge of balancing State revenues with expenditures during the session, the bills were not implemented.

There was another bill addressing commercial property taxes drafted in the Senate last year.  This bill differed somewhat from our proposal, however, it would also have helped downtown Northfield.

At yesterday’s meeting, we decided to work with the other group of senators to draft and support a single bill to address commercial property taxes in both the Senate and House.  Although the State continues to face financial challenges, we are hopeful that our unified efforts will achieve success in 2010.

100 Mbps to your desktop IS available to businesses in Downtown Northfield.

The NDDC switched over to the St. Olaf Telephone company late last week. Here is their Jack-of-all-trades, Jeremy Bokman, installing the new line.

I’m not anything near an expert on this topic. What I understand is that you can get internet service that is as fast as anything available in the world…in Downtown Northfield.

Last Friday a number of Commercial Property Owners in Downtown Northfield took advantage of the half-priced drinks for anyone bringing in their tax statements to several local establishments. A few of them posed for a photo in Bridge Square.

As many of you are aware, commercial property taxes in downtown Northfield have risen over 30% a year for the past seven years or so; the total increase since 2000 is well over 200%. With rents remaining stable, there is no longer sufficient cash flow to address building operating expenses, much less maintenance and improvements.

The tax payment due-date confirmed this grim reality. The dozen or so commercial property owners with whom I spoke last week all had to either draw down their savings or borrow money from the bank to pay their tax bills.

The situation is not economically sustainable. Our architectural, commercial, and cultural health, heritage, and hope is at risk.

The Northfield Downtown Development Corporation (NDDC) is pleased to announce Commercial Property Taxpayer’s Specials, Friday, May 15th from 4 p.m. to 6 p.m., at select establishments in historic downtown Northfield. Bring your commercial property tax statement in for a 50% discount on beverages. It’ll be the best deal that commercial property owners are likely to get on this day.

Rising commercial property taxes are threatening the economic vitality of our historic downtown. Since 2000, commercial property taxes have increased by double-digit percentages every year; most building owners have seen their taxes increase by over 200 percent in the past seven years. Commercial property taxes have now reached a level where the local market rent rates no longer cover operating expenses, much less generate cash for basic maintenance or building improvements.

We’re not sure if misery loves company but commercial property owners sure would love a better deal. So come on downtown, to the Contented Cow, Froggy Bottoms, J. Grundy’s Rueb-N-Stein and the Tavern Lounge (riverside of the Archer House) with your commercial property tax statement on May 15^th and get a 50% discount on your drink. Who knows, maybe the State Legislature might even pick up on the 50% reduction idea.

The board members of the NDDC and downtown stakeholders in Northfield continue to hope and work for some tax relief for commercial property owners. However, now and then, we can take time to share some smiles with our friends.

After getting an announcement from Mill Towns Trail advocate Peggy Prowe that the bicycle bridge over the Cannon River was going to be lifted and put in place, with the north and south sections joined together, and a tip from Mayor Mary Rossing the the event would occur Monday, April 27th, at 9 a.m., I headed over to catch the action. It was a “nipping and eager air” this morning, and noticing very little action, I returned to the office.

According to an unreliable source, there was a mechanical problem with one of the cranes. The erection/installation has been rescheduled for tomorrow (Tuesday, April 28th).

Peggy noted that the bridge, a long-awaited Northfield piece of the Mankato to Red Wing Mill Towns Trail, is “the result of Federal SafTLu Funds, Rotary Matching Funds, and State Bonding Funds”. Once the steel girders are in place, there are a few more steps in the process: a concrete deck must be poured, landscaping must be planted, and the in-town segment of the trail must be completed.

However, it seems that the project is still on schedule for completion in early July. I’m looking forward to riding over it.

As we have said many times and in many places, rising commercial property taxes are threatening the economic vitality of our historic downtown. Since 2000, commercial property taxes have increased by double-digit percentages every year; most building owners have seen their taxes increase by over 200 percent in the past seven years. Commercial property taxes have now reached a level where the local market rent rates no longer cover operating expenses, much less generate cash for basic maintenance or building improvements.

We greatly appreciate the opportunity created by Representative Bly and Senator Dahle to share the story of the situation in Northfield with members of the House and Senate Property Tax Committees. We were impressed with the interest and respect shown to us by members of both committees. While acknowledging that there are significant financial challenges facing the State, they clearly demonstrated that they could see that the situation created by rising commercial property taxes in downtown Northfield was not economically sustainable.

The NDDC continues to hope that there will soon be some relief for commercial property owners in older commercial districts in Minnesota. If, at times, we must take a step back, we will follow up by taking two steps forward.

It gave us an opportunity to provide the committee members with important details of the issue. We illustrated the changing economics of owning and operating a building in downtown Northfield.

Rent rates in downtown Northfield are at modest levels, most are in the 6 to 8 dollar per square foot range. With the mortgage costs at $3.00 or $3.50 per square foot, common area utilities at 75 cents per square foot, and insurance at 50 cents per square foot, there’s about $2.25 left for all other building costs. Since the year 2000, the average property tax cost has gone from $1.50 per square foot to $2.50.

In fact, I have seen the year-to-year operating expenses on about a half dozen buildings in downtown Northfield. Indeed, they have gone from producing positive cash flow to a point where the owners are now having to draw down savings to keep their buildings operating.

But it’s not just about the economics of old buildings. These older commercial districts are important to Minnesota. These districts are the most visible indicators of community pride, can be a key asset in the efforts to recruit and retain residents and businesses, serve as a focal point or gathering place for our citizens, and symbolize our communities’ heritage.

We thank all the Senators involved in today’s hearing for the opportunity to raise the awareness of the commercial property tax situation in downtown Northfield.