WREDC Annual Report to Members

Worthington Regional Economic

Development Corporation

Annual Report

 

February 2nd 2017

WREDC Members and Stakeholders:

 

We want to start with a sincere THANK YOU for your continued support in 2016. Worthington Regional Economic Development Corporation (WREDC) is a public private partnership established with the purpose of promoting economic and community development throughout Nobles County.

 

WREDC maintains and projects healthy financial standing as we look forward to 2017, with about $235,000 annual operating budget. WREDC operates an $830,000 in revolving loan funds with majority assisting area businesses in the form of gap financing and other loans. It is important to note that about 77% of WREDC budget comes from direct annual contribution from the City of Worthington, Worthington Public Utilities, and Nobles County, while the remainder comes from private sector annual membership dues, corporate support, sponsorships, and other sources.

 

In 2016, WREDC and Worthington Area Chamber of Commerce worked together with support from Southwest Initiative Foundation to reach out to minority and women owned businesses in our area. This effort is ongoing and it helped us directly engage business owners to help us better serve their needs.

 

WREDC continues to provide direct technical and business support. In 2016, we have worked directly with 21 local businesses and assisted three businesses with direct loans or by assisting them with business planning and financial projections.

 

WREDC is pleased to share with you that by the end of 2016 we have raised over $110,000 towards the JBS Housing Challenge Fund. The fund is designed to assist local and area developers construct and operate market rate rental housing of four units or more. WREDC Board encourages builders and real estate investors to engage WREDC staff to help put this fund to good use in 2017. This housing challenge fund is in place because of the generous contributions from JBS and First State Bank Southwest, and we have and continue to reach out to other partners to promote and build this fund.

 

Since its start in 2014, Nobles Home Initiative accepted 52 applications and resulted in the construction of 43 new single-family housing units. The NHI program was recently utilized by North Development Group (NDG) who worked directly with city of Worthington to secure funding from Minnesota Department of Employment and Economic Development (DEED) for the construction of 72 market rate rental units north of the old mall property along Grand Avenue.

 

The Nobles Home Initiative program was used as a model in Cottonwood County and the City of Austin, while other communities like Waseca are in process of employing the same program to meet housing demand. We anticipate another 4 NHI housing starts this Spring with additional applications coming in before the program ends on December 31st 2017.

 

WREDC would like to see NHI program extended and/or modified to meet the need for mixed use and rental housing starts and/or redevelopment. This type of program is needed to encourage redevelopment opportunities for underutilized properties, and allow for maximum local control of program requirements and application.

 

NHI could also be a valued instrument to incentivize investments in downtown area and to work with vacant property owners to encourage construction/remodeling rental housing, office, and commercial developments in the heart of Worthington.

 

See graph below showing overall property tax revenue with and without NHI.

 

 

$ Property Tax Revenues

w/NHI

without/NHI

New Housing Units/year

 

 

 

Since housing in general and rental housing supply in particular were identified as a challenge in the 2013 City of Worthington Housing Study, community leaders and institutions worked together to meet this challenge. The study stated that by 2020, Worthington needs 500 new housing units to meet existing and projected demand. Early in 2014 the City took the lead, and worked with Worthington Housing Authority (HRA), local banks, and the private sector to build Rising Sun, a 48 units rental property. WREDC recognized housing as a challenge to economic development and worked to implement the Nobles Home Initiative in Nobles County.

 

This focus on housing since the release of the housing study in 2013 demonstrated our ability to address this challenge and since then 211 housing units were either built, in process of being built, or being planned as is the case with the 72 market rate rental development north of the old mall.

 

We continue to engage the business community by providing technical and material assistance and gap financing through WREDC Revolving Loan Fund programs, grant writing and administration, assistance with development review process, project development services, business advocacy, and regional marketing among other things.

 

WREDC currently has nine (9) active loans throughout Nobles County and continues to support businesses with their expansion and location needs.

 

The WREDC pursued the following objectives during the last 12 months:

 

WREDC staff maintains constant contact with various city departments, county departments and private partners to contribute to overall success in our economic development efforts.

WREDC has taken the lead in working with Marthalers’ on engineering & planning of the development and is working to promote the area among expanding and new businesses.  This development represents a unique opportunity for Worthington to create a new destination for shopping that has the potential to fill needed gaps in local market and attract shoppers from a wide area. WREDC is currently working with number of promising leads to locate on the site.

WREDC works and continues to coordinate its activities with all its partners by holding private sector meetings and monthly board meetings, and on site business visits. WREDC meeting schedule, and related updates are on line at www.worthington-minnesota.com We encourage members to visit the site to find out about latest initiatives.

Papa Murphy’s was another project that WREDC staff provided critical insights and services to, by assisting project owners in packaging applications for site redevelopment. This project is a clear demonstration of the redevelopment potential along Oxford Street.

We also seek input & ideas on a project-by-project basis to include informal updates on business assistance and other technical support we provide our clients.

In 2016 WREDC applied for and was approved by the State of Minnesota to be an authorized local entrepreneurs lender for women, minority, veterans, and disabled American business owners. WREDC is in the process of setting up this loan program to help benefit Nobles County entrepreneurs, and expect to begin loan review sometime in Mid to late March 2017.

 

 

The Worthington Sun Is Rising

As we look back at the community’s recent investments, we cannot help but notice the positive returns on investments the community made in infrastructure, business development, and community amenities. A quick review of the activities around Oxford Street and Grand Avenue reveals the direct results of local public investment at work. We see the benefits of a new road and infrastructure has on driving private investments in both public and private housing, and in commercial development. In addition, the investments made west of Hwy 59 by the city to open up new commercial land for development and extending Bioscience Drive, will make it easier to go out and market to national and regional retail and service brands.

Looking forward to 2017, WREDC is seeking to achieve long-standing objectives and we want to work with our private partners to achieve the following:

  • Develop and maintain local, interested, and aggressive private investment group that is ready to take advantage of opportunities and provide quick turnaround response. (Worthington Shark Tank)

 

  • Worthington Global Market – (take advantage of rich culture, arts, and food to create a regional destination) – There are number of opportunities within downtown Worthington to pursue this concept. WREDC is engaged in ongoing discussion to vet the concept with faith and community leaders.

 

  • Business Retention & Expansion for all area businesses and to utilize DEED loan program for its intended target (minority and women, veterans and disabled business owners).

 

  • Continue and expand on minority business and entrepreneur engagement to explain and provide services.

              

  • Promote the recent approval of WREDC as a direct women and area entrepreneur lender through DEED.

 

  • Expanding tax abatement incentives for commercial developments and redevelopment in targeted areas throughout Nobles County.

 

  • Work with Nobles County Communities to bring about Federal and State resources and assist them in maintaining infrastructure, and ongoing reinvestment in housing and commercial rehabilitation. This will be done through USDA Rural Development, State of Minnesota SCDP, and by seeking partnerships with related agencies.

 

  • Utilize local and state media in a joint effort with Convention & Visitors bureau, Worthington Chamber of Commerce and others to carry out statewide campaign for Worthington branding including Bio Science conference.

 

  • Create a standing business recruitment committee to market available land ready for development, redevelopment opportunities, and to market Worthington as a regional economic engine to investors and private businesses. This committee will consist of Chamber, WREDC, City, County, and financial institutions among others. A program is being put together by WREDC staff with onsite scheduled visits to individual business and trade shows.

 

  • We believe that opportunities are abound and that there is tremendous capacity to fill in gaps in five to six local economic sectors. These sectors cover retail, entertainment, services, food, clothing, and arts and leisure types of businesses. (combined, the market size in those sectors could approach $125,000,000) based on Trade Area Study conducted by U of MN in 2013.

 

  • We are working on 2017 Bio conference to make it more efficient and of direct benefit to the community and to local industry.

 

  • Work with private & public partners to provide/expand business “incubator” space and help community attract emerging technology businesses.

 

  • We have engaged a number of promising businesses through WREDC membership in Community Venture Network and are planning to show case businesses that have the potential to match our objectives in promoting value added agriculture and ag-bio businesses.

 

  • We want to engage our partners in both public and private sectors in ongoing monthly meeting, and discussions to exchange and share project updates.

 

  • WREDC serves on number of policy and government relations committee as part of its active role in Minnesota Economic Development Association, and Greater Minnesota Partnership. Such organizations serve as a platform to raise awareness and affect public policy on housing, economic development, and infrastructure investments in outstate Minnesota.

 

Highlight and establish aggressive legislative priorities with regards to economic disparity throughout the state and specifically between Southwest Minnesota and other regions. This item requires all hands on deck and constant engagement with state and legislative leaders.

 

WREDC values education and a well-trained workforce and continues to work with area schools to host and organize the annual lab day with help from MnWest Community and Technical College.

 

In 2016 WREDC organized another successful Bioscience Conference, and is in the planning process for the 13th annual conference set for April 6th & 7th, 2017. Worthington Bio focus will be on research and development and anticipated “changes” to research funding at State and Federal levels.

 

We are proud of our partnership with Prairie Holdings Group and with Dr. Randy Simonson as we work together to engage University of Minnesota College of Veterinary Medicine. We have maintained the faith as we worked with various groups to complete the lab space at the Biotechnology Advancement Center (BAC). We now have a very promising opportunity (thanks to Dr. Simonson and to Dr. Tracy Oleson) to work on putting the lab space to good use.

On behalf of WREDC Board of Directors, I want to thank you for your moral and material support to get things done. When all things are equal, financial resources are what makes the difference in achieving common objectives. However, financial resources are not the only ingredient to do so. It is often times people when things are not equal who will always get things done. In Worthington, we have the right kind of people.

  We continue to seek your active engagement in WREDC to help shape public policy, accomplish shared priorities, and work to address common challenges. We are grateful to our members and appreciate your continued support.

 You may reach us by phone (507)372-5515, e mail: invest@worthington-minnesota.com or just stop by the office located at 1121 Third Avenue as your time allows.

Sincerely,

Abraham Algadi

Executive Director