Lehmann says state of the city is real good

Bemidji faces growth challenges, but has the tools to manage it, says Mayor Richard Lehmann.

"The state of the city is real good," he said Thursday to members of the Bemidji Area Intergovernmental Relations Committee. "There are challenges, as most communities growing like us have, but it's not something that can't be overcome."

Lehmann summarized his State of the City address, which he gave Jan. 29 as the first such required address under an amendment to the City Charter approved by Bemidji voters in November.

He also told the intergovernmental panel, which met at Northwest Technical College, about ongoing development in both ends of the city.

"Menards will be coming," he said of the home furnishing big-box retailer. "They have come to a verbal agreement on several issues, including with neighboring businesses on ingress and egress to the site."

In mid-January, the Bemidji Planning Commission tabled preliminary plat approval for the store to allow a solution to access problems to neighboring businesses to Paul Bunyan Drive as the four-lane divided highway passes by the 21-acre site, which is now Spaulding Motors.

"The store Menards plans in Bemidji would be their largest in Minnesota," Lehmann said.

Asked if that development will spur others, such as more restaurants or retail, Lehmann said it should, but that "there's a lot of rumor mills."

The only retailer mentioned by name in the community has been department store Kohl's, which Lehmann said the prevalent story now is that Kohl's has decided to strengthen its southern franchises after Hurricane Katrina, rather than build new in the north.

"There is potential for the Pinnacle site to attract retail," Lehmann said of the proposed outlet mall in south Bemidji. "It's anybody's guess."

The developer of that site, off U.S. Highway 2 at U.S. Highway 71 South, has leveled the site but no construction has taken place.

"There is no new information there," Lehmann said, adding that city staff met with the developer, Harry Takhar, on Wednesday. "There are no new plans out of that meeting."

"Retail is good, but is there work to attract manufacturing?" asked Bemidji schools Superintendent Jim Hess.

The Joint Economic Development Commission, funded by both Beltrami County and the city plus area banks, is spearheading that effort, Lehmann said. Also, the Bemidji Regional Airport Commission is hoping to attract manufacturers to a state Job Opportunity Building Zones site there.

"We do have the wood industry," he said, adding that efforts are underway to use production capacity already here to produce value-added products, such as engineered floor joists.

Asked about the effect of First National Bank moving from the downtown to north Bemidji, Lehmann said a study has yet to be done about what it means to the downtown. The move, however, has put "on the backburner" a proposal to build a city parking ramp on Lot No. 4, near the current bank.

"Part of that is also the prospect of an events center creating more parking, which may eliminate a ramp," he said.

The City Council earlier this week approved a resolution to the Legislature, asking it to extend the city's half-cent sales tax to pay for regional events center construction once it has reached $9.8 million for parks and trails improvements in the city.

At $1.5 million a year, that point should be reached in seven years, Lehmann said. The resolution caps events center construction at $50 million, but a firm design has yet to be settled on, or costs figured out.

"There will be a lot of public input yet to find out what the public wants," he said, with those sessions starting late this month.

If the council decides to go ahead with construction, plans call for 40 percent of the costs to come from state bonding and the remainder through the sales tax. While 2008 is the next state bonding cycle, Lehmann said there is a push to include the proposal this year, along with monies for Duluth's convention center upgrade and St. Cloud's National Hockey Center.

But another problem is the Legislature's apparent dislike for local option sales taxes, despite having the DFL now in charge of the House.

"There is still an amount of dislike" for the local tax, Lehmann said. "It is a good fortune that we already have one in place and are only asking for an extension."

That the state already committed $3 million to planning and design of the events center also helps, he said, as not extending the sales tax now would amount to the state wasting that investment.

Asked about the southeast Lake Bemidji development, with property owned by ShoreQuest, Lehmann said the city won $1.5 million in state bonding last year for a dual-track trail through that area.

"We are still discussing that, with work needed to assess lake cleanup and costs," Lehmann said. The site of a former wood products plant, and an earlier sawmill, tests need to be conducted to assess lake pollution.

"There is a process now to hire a firm and check contamination in the lake and do borings," the mayor said. "That will have a big impact on how to proceed -- it could be extremely expensive to clean to become a recreational shorefront."

One of the tools to deal with growth, he said, is the new community-wide planning effort which will take effect 30 days after the Joint Planning Board approves zoning and land use policies, slated for Monday at City Hall.

The effort comes after an orderly annexation agreement between the city and Northern and Bemidji townships over a 15-year period.

"We will be working within the parameters that control growth," Lehmann said. "That agreement brings an exciting time, as a hybrid of growth plans that has received a lot of attention statewide."

The agreement allows an opportunity to extend city sewer and water into the slated annexation areas, he said, "and is a step to doing it around the lake. One more foot of pipe to areas unserved is one step closer to that.

"We have heard from some people who live outside the 15-year area who say we didn't go far enough," he said, "but we thought we were pretty bold going as far as we did."

Lehmann also cited as positive the city's bond rating change from AAA to AA, a move that will mean better interest rates for future city bonding as bond houses see the city as having less financial risk.

Also as a 2006 highlight, Lehmann said the city pulled back from having a public safety director to the current management of a police chief and an interim fire chief.

"We did that as an experiment five years ago with a public safety director," Lehmann said. "I'm not saying it failed, but going back (to separate department heads) gives both departments more autonomy and their own identity."

Said Lehmann: "Overall, the community is in very good shape."