HomeMy WebLinkAbout2011_12_20 CC PKT
Brookings City Council
Tuesday, December 20, 2011
5:00 p.m. Work Session
6:00 p.m. Regular Meeting
City Hall Council Chambers
311 Third Avenue
The City of Brookings is committed to providing a high quality of life for its citizens and fostering a
diverse economic base through innovative thinking, strategic planning, and proactive, fiscally responsible
municipal management.
5:00 p.m. WORK SESSION
Work sessions are open to the public. During the work session the city staff would brief the council on
items for that particular meeting, introduce future topics, and provide a time for Council members to
introduce topics.
1. Executive Session for purposes of discussing marketing or pricing strategies for a
municipally owned business where public discussions would be harmful to the
competitive position of the business, pursuant to SDCL 1-25-2 (5).
Action: Motion to enter executive session – voice vote
Motion to leave executive session – voice vote
2. Brookings Municipal Utilities Financial Report
3. City Council Member Ex-Officio Reports.
4. Joint Powers Board members’ Report.
5. City Council member introduction of topics for future discussion. *
6. Review of Council Agenda, Invites and Obligations.
*Any Council member may request discussion of any issue at a future meeting only. Items cannot be added for action at
this meeting. A motion and second is required stating the issue, requested outcome, and time. A majority vote is required.
6:00 p.m. REGULAR MEETING
1. Call to order.
2. Pledge of Allegiance.
3. Record of Council Attendance.
4. Action to approve the following Consent Agenda Items:*
A. Action to approve the agenda.
B. Action to approve Resolution No. 145-11, a Resolution designating the Mayor as
a Certifying Officer for ICAP Self-Help Homeownership Opportunity Program.
C. Action to approve Resolution No. 146-11, a Resolution authorizing Change
Order No. 1 for 2011-02BLD City of Brookings Garage Project, Clark Drew
Construction (under $5,000 increase).
D. Action to approve Resolution No. 147-11, a Resolution authorizing the Mayor to
Sign an Agreement for Preliminary Engineering to Evaluate FAA Impacted
Facilities.
Motion to Approve, Request Public Comment, Roll Call
5. Items removed from Consent Agenda.
*Matters appearing on the Consent Agenda are expected to be non-controversial and will be acted upon by the Council at
one time, without discussion, unless a member of the Council or City Manager requests an opportunity to address any given
item. Items removed from the Consent Agenda will be discussed at the beginning of the formal items. Approval by the
Council of the Consent Agenda items means that the recommendation of the City Manager is approved along with the terms
and conditions described in the agenda supporting documentation.
Open Forum/Presentations/Reports
6. Open Forum.
7. SDSU Student Senate Report.
First Readings**
8. Ordinance No. 27-11: An ordinance pertaining to an application for an amended
Conditional Use for a three-unit apartment in the Residence R-2 District on the west
183 feet of the east 288 feet of the south 140 feet of Block 11, Parkdale Home Second
Addition, 208 West 8th Street.
Public Hearing: January 10th
**No vote is taken on the first reading of an Ordinance. The title of the Ordinance is read and the date for the public
hearing is announced.
Other Business
9. Update on BEDC resolution pertaining to the NW Quadrant Project.
Action: Informational
10. Review of Liquor Store draft Request for Proposal.
Action: Informational
11. Discussion and possible action regarding The Shamrock & Tappers Bar and Grill Liquor
Operating Agreement, Michael D. Bailey, owner, Block 1, Hyland Addition, 2201 22nd
Avenue South, Brookings.
Action: Motion to approve, request public comment, roll call
12. Adjourn.
Brookings City Council
Tim Reed, Mayor
Jael Thorpe, Deputy Mayor & Council Member
Council Members Tom Bezdichek, John Kubal, Mike McClemans, Keith Corbett, Ope Niemeyer
Council Staff:
Jeffrey W. Weldon, City Manager
Steven Britzman, City Attorney
Shari Thornes, City Clerk
View the City Council Meeting Live on the City Government Access Channel 9.
Rebroadcast Schedule: Wednesday 1:00pm / Thursday 7:00pm / Friday 9:00pm / Saturday 1:00pm
The complete City Council agenda packet is available on the city website: www.cityofbrookings.org
If you require assistance, alternative formats, and/or accessible locations consistent with the Americans with Disabilities Act,
please contact Shari Thornes, City ADA Coordinator, at 692-6281 at least 3 working days prior to the meeting.
City of Brookings
December 20, 2011
3
5:00 P.M. WORK SESSION
Work Sessions are open to the public. During the work session the city staff would brief the council on
items for that particular meeting, introduce future topics, and provide a time for Council members to
introduce topics.
1. Executive Session for purposes of discussing marketing or pricing
strategies for a municipally owned business where public
discussions would be harmful to the competitive position of the
business, pursuant to SDCL 1-25-2 (5).
(1) Discussing the qualifications, competence, performance, character or fitness of
any public officer or employee or prospective public officer or employee. The term
"employee" does not include any independent contractor;
(2) Discussing the expulsion, suspension, discipline, assignment of or the educational
program of a student;
(3) Consulting with legal counsel or reviewing communications from legal counsel
about proposed or pending litigation or contractual matters;
(4) Preparing for contract negotiations or negotiating with employees or employee
representatives;
(5) Discussing marketing or pricing strategies by a board or commission of a business
owned by the state or any of its political subdivisions, when public discussion may be
harmful to the competitive position of the business.
However, any official action concerning such matters shall be made at an open official
meeting. An executive or closed meeting shall be held only upon a majority vote of the
members of such body present and voting, and discussion during the closed meeting is
restricted to the purpose specified in the closure motion. Nothing in § 1-25-1 or this
section may be construed to prevent an executive or closed meeting if the federal or
state Constitution or the federal or state statutes require or permit it. A violation of
this section is a Class 2 misdemeanor.
Source: SL 1965, ch 269; SL 1980, ch 24, § 10; SL 1987, ch 22, § 1.
Action: Motion to enter executive session – voice vote
Motion to leave executive session – voice vote
City of Brookings
December 20, 2011
4
5:00 P.M. WORK SESSION
Work Sessions are open to the public. During the work session the city staff would brief the council on
items for that particular meeting, introduce future topics, and provide a time for Council members to
introduce topics.
2. Brookings Municipal Utilities Financial Report.
Representatives of Brookings Municipal Utilities will provide the City
Council and public with a financial report and update on current and
pending issues.
City of Brookings
December 20, 2011
5
5:00 P.M. WORK SESSION
Work Sessions are open to the public. During the work session the city staff would brief the council on
items for that particular meeting, introduce future topics, and provide a time for Council members to
introduce topics.
3. City Council Member Ex-Officio Reports.
Pursuant to council direction, “City Council Member Ex-Officio Reports”
will be a standing agenda item at all Council Work Sessions. The Council
Members that serve as Ex-Officio members on the Brookings Health
System Board of Trustees and Utility Board will provide verbal reports
regarding recent meetings they have attended.
Brookings Municipal Utility Board:
1. Council Member Niemeyer
2. Council Member Corbett
Brookings Health Systems Board:
1. Council Member Kubal
2. Council Member McClemans
City of Brookings
December 20, 2011
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5:00 P.M. WORK SESSION
Work Sessions are open to the public. During the work session the city staff would brief the council on
items for that particular meeting, introduce future topics, and provide a time for Council members to
introduce topics.
4. Joint Powers Board Council Members’ Report.
Pursuant to council direction, “Joint Powers Board City Member Updates”
will be a standing agenda item at all Council Work Sessions. The Council
Members serving on the Joint Powers Board will provide verbal updates
regarding recent meetings they have attended.
Mayor Tim Reed & Council Member Kubal
City of Brookings
December 20, 2011
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5:00 P.M. WORK SESSION
Work Sessions are open to the public. During the work session the city staff would brief the council on
items for that particular meeting, introduce future topics, and provide a time for Council members to
introduce topics.
5. City Council member introduction of topics for future discussion.
Any Council member may request discussion of any issue at a future
meeting only. Items cannot be added for action at this meeting. A motion
and second is required stating the issue, requested outcome, and time
frame. A majority vote is required.
City of Brookings
December 20, 2011
8
5:00 P.M. WORK SESSION
Work sessions are open to the public. During the work session the city staff would brief the council on
items for that particular meeting, introduce future topics, and provide a time for Council members to
introduce topics.
6. Review of Council Agenda, Invites and Obligations.
Date
Day Event &
Brief Description
Time Location / Town /
Address / Directions
December 20 Tuesday Council Meeting 5:00 p.m. Council Chambers
January 9 Monday
Butler Human Rights
Award Reception for
Scott Nagy
5:30 p.m. Library, Cooper Room
January 10 Tuesday Council Meeting 5:00 p.m. Council Chambers
January 18 Wednesday Brookings Day in
Pierre Pierre
January 24 Tuesday Council Meeting 5:00 p.m. Council Chambers
February 7 Tuesday Rib Dinner with your
Legislator Kings Inn, Pierre
February 8 Wednesday Municipal Government
Day Pierre
February 9 Thursday Leadership Brookings 8:30 – 12:00 noon City Hall
February 14 Tuesday Council Meeting 5:00 p.m. Council Chambers
February 15 Wednesday
Goal Setting
Reception & Dinner
with Leadership Team
5:00 p.m. TBD
February 16 Thursday Goal Setting Retreat 8:00 a.m. – 5:00
p.m. TBD
February 28 Tuesday Council Meeting 5:00 p.m. Council Chambers
March 10-14 NLC – Congressional
City Conference Washington, DC
March 13 Tuesday Council Meeting 5:00 p.m. Council Chambers
March 19-23 Board of Equalization Meeting Room
March 27 Tuesday Council Meeting 5:00 p.m. Council Chambers
April 12 Thursday Council Meeting /
Election Canvass 5:00 p.m.
April 24 Tuesday Council Meeting 5:00 p.m. Council Chambers
May 8 Tuesday Council Meeting 5:00 p.m. Council Chambers
May 22 Tuesday Council Meeting 5:00 p.m. Council Chambers
June 12 Tuesday Council Meeting 5:00 p.m. Council Chambers
9
6:00 p.m. REGULAR MEETING
1. Call to order.
2. Pledge of Allegiance.
3. Record of Council Attendance.
4. Action to approve the following Consent Agenda Items:
A. Action to approve the agenda.
B. Action to approve Resolution No. 145-11, a Resolution designating the Mayor as a
Certifying Officer for ICAP Self-Help Homeownership Opportunity Program.
C. Action to approve Resolution No. 146-11, a Resolution authorizing Change Order No.
1 for 2011-02BLD City of Brookings Garage Project, Clark Drew Construction (under
$5,000 increase).
D. Action to approve Resolution No. 147-11, a Resolution authorizing the Mayor to Sign
an Agreement for Preliminary Engineering to Evaluate FAA Impacted Facilities.
Motion to Approve, Request Public Comment, Roll Call
5. Items removed from Consent Agenda.
Open Forum/Presentations/Reports
6. Open Forum.
7. SDSU Student Senate Report.
First Readings
8. Ordinance No. 27-11: An ordinance pertaining to an application for an amended Conditional
Use for a three-unit apartment in the Residence R-2 District on the west 183 feet of the east
288 feet of the south 140 feet of Block 11, Parkdale Home Second Addition, 208 West 8th
Street.
Public hearing: January 10th
Other Business
9. Update on BEDC Resolution pertaining to the NW Quadrant Project.
Action: Informational
10. Review of Liquor Store draft Request for Proposal.
Action: Informational
11. Discussion and possible action regarding The Shamrock & Tappers Bar and Grill Liquor
Operating Agreement, Michael D. Bailey, owner, Block 1, Hyland Addition, 2201 22nd Avenue
South, Brookings.
Action: Motion to approve, request public comment, roll call
12. Adjourn.
City of Brookings
December 20, 2011
10
CONSENT AGENDA #4
4. Action to approve the following Consent Agenda Items: *
A. Action to approve the agenda.
B. Action to approve Resolution No. 145-11, a Resolution
designating the Mayor as a Certifying Officer for ICAP Self-
Help Homeownership Opportunity Program.
C. Action to approve Resolution No. 146-11, a Resolution
authorizing Change Order No. 1 for 2011-02BLD City of
Brookings Garage Project, Clark Drew Construction (under
$5,000 increase).
D. Action to approve Resolution No. 147-11, a Resolution
authorizing the Mayor to Sign an Agreement for
Preliminary Engineering to Evaluate FAA Impacted
Facilities
*Matters appearing on the Consent Agenda are expected to be non-controversial
and will be acted upon by the Council at one time, without discussion, unless a
member of the Council or City Manager requests an opportunity to address any
given item. Items removed from the Consent Agenda will be discussed at the
beginning of the formal items. Approval by the Council of the Consent Agenda
items means that the recommendation of the City Manager is approved along
with the terms and conditions described in the agenda supporting documentation.
ACTION: Motion to Approve, Request Public Comment, Roll Call
City of Brookings
December 20, 2011
11
CONSENT AGENDA #4
B. Action to approve Resolution No. 145-11, a Resolution
designating the Mayor as a Certifying Officer for ICAP Self-Help
Homeownership Opportunity Program.
Interlakes Community Action Partnership (ICAP) is preparing to utilize Self-
Help Homeownership Opportunity Program (SHOP) funds from the U.S.
Department of Housing and Urban Development. The proposed project is
located at the following legal address:
Lots 1-3 of Block 3 and Lots 11-14 of Block 4, Moriarty Heights
Addition, City of Brookings, Brookings County, South Dakota
First District Association of Local Governments is assisting ICAP with the
application and administration of the program funds. However, the SHOP
funds require a local unit of government to serve as the environmental
certifying officer for the purpose of signing required environmental
documents pertaining to this grant program. The City has previously
designated environmental certifying officers for similar projects, such as
Brookings Area Habitat for Humanity and other ICAP projects.
Approval of this resolution will designate the Mayor of the City of
Brookings as the certifying officer for the purpose of signing required
environmental documents pertaining to this grant program.
Staff Recommendation: Approve
City of Brookings
December 20, 2011
12
Resolution No. 145-11
Resolution Designating Mayor as Certifying Officer for ICAP
Self-Help Homeownership Opportunity Program
Whereas, the Inter-Lakes Community Action Partnership (ICAP) expects to utilize US
Department of Housing and Urban Development Self-Help Homeownership Opportunity
Program (SHOP) funds to assist with the purchase of land for housing development purposes;
and
Whereas, the City of Brookings is required to designate an environmental certifying officer for
the purpose of signing required environmental documents pertaining to this grant program;
Now, Therefore, Be It Resolved, that the Mayor be hereby designated as the city's official for
the purpose of signing environmental correspondence and other required documents and
forms for said project.
Passed and approved this 20th day of December 2011.
CITY OF BROOKINGS
____________________________
Tim Reed, Mayor
ATTEST:
________________________
Shari Thornes, City Clerk
City of Brookings
December 20, 2011
14
CONSENT AGENDA #4
C. Action to approve Resolution No. 146-11, a Resolution
authorizing Change Order No. 1 for 2011-02BLD City of
Brookings Garage Project, Clark Drew Construction (under
$5,000 increase).
This project entails work for the general construction of a new 73’ x 26’
vehicle storage garage at the new City-County Governmental site. The
garage is located on the City lot on the south side of Front Street between
5th Avenue and 6th Avenue, which is the previous substation site. The new
garage will house vehicles from the Motor Pool, Engineering and
Community Development departments. This project was bid as a lump
sum project and the project includes earthwork, cast in place concrete,
masonry, rough carpentry, gypsum board, thermal insulation, overhead
metal doors, asphalt shingles, floor drains and electrical work.
During the construction of the project, unforeseen items were discovered
and are included in this change order. The subgrade under the garage
consisted of poor material and required extra excavation and fill to stabilize
the footings. The contractor also uncovered a buried concrete structure
under the southwest corner of the proposed garage which could not be
removed. The contractor constructed a bond beam over the concrete
structure to stabilize the footings of the garage. The contractor provided a
deduct for the concrete apron on the north side of the garage since the
apron was already included in a contract for the City-County Government
Center project. The total cost of these items is an addition of $588.53 to
the contract which is summarized as follows:
Original Contract Price: $102,500.00
Change from Previously Approved Change Orders: $0.00
Contract Price Prior to this Change Order: $102,500.00
Increase of this Change Order (No. 1): $588.53
Contract Price incorporating this Change Order: $103,088.53
This resolution will approve Change Order No. 1 (CCO #1) for an
increase of $588.53 to the contract for this project.
City of Brookings
December 20, 2011
15
Resolution No. 146-11
Resolution Authorizing Change Order No. 1 for 2011-02BLD Airport Building
Addition Project; Clark Drew Construction
Be it Resolved by the City Council that the following change order be allowed for 2011-02BLD
Airport Building Addition Project: Construction Change Order Number 1
Adjust contract for additional excavation and fill for footings and construction of a bond beam
for the garage foundation due to a buried concrete structure and to deduct the concrete apron
for the garage for a total increase of $588.53 to the contract.
Passed and approved this 20th day of December 2011.
CITY OF BROOKINGS
________________________________
Tim Reed, Mayor
ATTEST:
_________________________
Shari Thornes, City Clerk
City of Brookings
December 20, 2011
16
CONSENT AGENDA #4
D. Action to approve Resolution No. 147-11, a Resolution
authorizing the Mayor to Sign an Agreement for Preliminary
Engineering to Evaluate FAA Impacted Facilities.
The City of Brookings is proceeding with the necessary surveying and
design for the upcoming construction of the new runway alignment at the
Brookings Regional Airport. One of the required steps is for the Federal
Aviation Administration (FAA) to conduct a preliminary engineering study
to evaluate the FAA facilities that will need to be moved because of the
runway construction project. The City was anticipating this agreement,
however it was just received and requires a short timeframe for signature.
The proposed agreement is for $70,000, which will be eligible for grant
reimbursement and we anticipate receiving the grant at a future date. This
agreement is different from the customary airport grant-funded projects,
where the FAA will require the fee to be paid as a deposit before the FAA
will perform the study. After the study is completed, any amount of the
deposit not spent on the study will be refunded to the City. Within this
study, the FAA will analyze the VOR (Very High Omni Directional Range),
ILS (Instrument Landing System), AWOS (Automated Weather Observing
System), and other navigational aids. This agreement is the first phase for
the navigational aids and it will provide the preliminary engineering review,
site visits and project planning. A future agreement will be provided for full
engineering review, construction oversight, equipment installation and flight
check.
This resolution will authorize the Mayor to sign the Sign an Agreement for
Preliminary Engineering to Evaluate FAA Impacted Facilities.
City of Brookings
December 20, 2011
17
Resolution No. 147-11
Resolution Authorizing Mayor to Sign an Agreement for
Preliminary Engineering to Evaluate FAA Impacted Facilities
Whereas, the Brookings City Council desires navigational aids to support the Brookings
Regional Airport’s planned project to build new runway 11/29 which will replace the existing
Runway 12/30; and
Whereas, the runway project will impact several FAA facilities which will require the relocation
of these facilities and the facilities’ infrastructure.
Now, Therefore, Be Resolved, that the Mayor is hereby authorized to sign all documents
related to Federal Aviation Administration Project “Preliminary Engineering to Evaluate FAA
Impacted Facilities”.
Passed and approved this 20th day of December 2011.
CITY OF BROOKINGS
____________________________
Tim Reed, Mayor
ATTEST:
________________________
Shari Thornes, City Clerk
City of Brookings
December 20, 2011
16
5. Items removed from Consent Agenda.
Matters appearing on the Consent Agenda are expected to be non-
controversial and will be acted upon by the Council at one time, without
discussion, unless a member of the Council or City Manager requests an
opportunity to address any given item.
Items removed from the Consent Agenda will be discussed at the beginning
of the formal items. Approval by the Council of the Consent Agenda items
means that the recommendation of the City Manager is approved along
with the terms and conditions described in the agenda supporting
documentation.
City of Brookings
December 20, 2011
17
Open Forum
6. Invitation for a Citizen to schedule time on the Council Agenda
for an issue not listed.
At this time, any member of the public may request time on the agenda for
an item not listed. Items are typically scheduled for the end of the meeting;
however, very brief announcements or invitations will be allowed at this
time.
7. SDSU Student Senate Report.
President – Mark York
Vice-President – Anthony Sutton
Administrative Assistant – Brooke Reiner
Finance Chair – Brian Gottlob
State & Local Chair – Jameson Berreth
SDSU Senate Website: http://www.wix.com/sdsu_sa/sa
City of Brookings
December 20, 2011
18
First Readings**
8. Ordinance No. 27-11: An ordinance pertaining to an application
for an amended Conditional Use for a three-unit apartment in the
Residence R-2 District on the west 183 feet of the east 288 feet of
the south 140 feet of Block 11, Parkdale Home Second Addition,
208 West 8th Street.
Public Hearing: January 10, 2012
**No vote is taken on the first reading of an Ordinance. The title of the
Ordinance is read and the date for the public hearing is announced.
Applicant: John Moriarty
Proposal: Remodel 3-unit apartment and add two bedrooms
Background: The owner was granted a conditional use to establish three
dwelling units in this older house in 2009. The ordinance is attached and
details the one condition which was required for compliance.
This lot is 183’ x 140’ (.6 acres). A parking lot was established to the west
of the tri-plex in 2009. The owner’s residence is west of the parking lot. A
single-family dwelling is on the corner to the east.
Specifics: The petitioner submitted plans to convert the attached garage
into living space. Two bedrooms would be added to one of the units which
triggered the amendment. On-premise parking would have to be increased
accordingly. All the parking will be in the west parking lot.
Recommendation: The Planning Commission voted 7 yes and 0 no to
recommend approval of the amendment to the Conditional Use Permit.
City of Brookings
December 20, 2011
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Ordinance No. 27-11
An Ordinance pertaining to an application for an amended Conditional Use for a
three-unit apartment in the Residence R-2 District.
Be it ordained by the governing body of the City of Brookings, South Dakota that said
Conditional Use shall be approved for the addition of two bedrooms in one of the dwelling
units in the apartment on the west 183 feet of the east 288 feet of the south 140 feet of Block
11, Parkdale Home Second Addition with the following conditions:
NONE
All sections and ordinances in conflict herewith are hereby repealed.
First Reading: December 20, 2011
Second Reading: January 10, 2012
Published:
CITY OF BROOKINGS
__________________________
Tim Reed, Mayor
ATTEST:
________________________________
Shari Thornes, City Clerk
City of Brookings
December 20, 2011
22
Planning Commission
Brookings, South Dakota
December 6, 2011
OFFICIAL MINUTES
Chairperson Al Heuton called the regular meeting of the City Planning Commission to order
on December 6, 2011, at 7:00 PM in the Council Chamber at City Hall. Members present were
Wayne Avery, Hal Bailey, Mike Cameron, Greg Fargen, Alan Gregg, John Sydow, and Heuton.
Donna DeKraai and John Gustafson were absent. Also present were Shawn Knapp, Jim Flippin,
Community Development Director Mike Struck, and Planning and Zoning Administrator Dan
Hanson.
Item #4 – John Moriarty has submitted an application to amend a Conditional Use Permit on
the west 183 feet of the east 288 feet of the south 140 feet of Block 11, Parkdale Home Second
Addition, also known as 208 West 8th Street. The request is to establish two additional
bedrooms in one dwelling unit.
(Gregg/Sydow) Motion to approve the amendment. All present voted aye. MOTION
CARRIED.
SUMMARY OF DISCUSSION
Item #4 – Shawn Knapp, representing John Moriarty, stated the parking lot would be increased
proportionally to the increase in bedrooms. Heuton asked where the new parking spaces
would be. Knapp responded next to the former garage. Fargen asked if the building would be
enlarged. Knapp replied no. Cameron inquired if the two bedrooms were being added to the
one bedroom apartment. Knapp answered yes.
Heuton noted that a letter, supporting the request, had been submitted by a neighbor.
City of Brookings
December 20, 2011
27
Other Business
9. Update on BEDC Resolution pertaining to the NW Quadrant
Project.
At the request of Council, Al Heuton, BEDC Executive Director, will provide an update
on the BEDC Resolution pertaining to the NW Quadrant project. The resolution was
provided to the City Council on April 5, 2011.
Brookings Economic Development Corporation
Northwest Campus Task Force
Position Recommendation
In April, 2010 a task force of BEDC members was created and charged with the following task:
To determine if the BEDC Board of Directors should consider taking a position on the NW
Campus 300 bed apartment building project, and if so, what should that position include.
Task Force should consider:
The need for housing
Housing alternatives
Appropriate locations
Impact on SDSU
Impact on the community
Factors related to fair competition
Prior to providing a recommendation to the BEDC Board of Directors for consideration, it may
be useful to provide first, a brief overview of events leading to this recommendation, and
second, a brief summary of the complexities involved in considering a position on this topic.
Overview of Events
In September 2009 South Dakota State University unveiled a concept plan for the northwest
corner of the SDSU campus. This plan document represents one component of a master plan
development concept for SDSU. The concept plan is depicted in the “Northwest Quadrant
Mixed-Use Development Feasibility Study Final Report” prepared by Brailsford and Dunlavey.
The report suggests a market exists for the establishment of an “upper-class and graduate
private-style upscale apartment including complementary retail space.” Although the feasibility
study introduces additional recommendations for student apartments, retail, active adult
housing, and a hotel conference center; the task force considered only that portion of the
student housing currently in question, the 300 bed upper-class and graduate facility.
City of Brookings
December 20, 2011
28
During the month of November 2009, BEDC conducted two meetings with local developers to
listen to their thoughts on the Northwest Quadrant study. The initial meeting was a
“developer only” meeting intended to provide developers with a forum to express their
support or concerns for the proposed project. The second meeting was organized to provide
President Chicoine, SDSU personnel and developers an opportunity to engage in discussion and
questions related to the project, process and timing. Developer concerns addressed during the
sessions included topics such as the potential for unfair competition with a public entity
involved, market vacancy rates, a changing role and mission for SDSU, tax loss concerns, the
bond financing process and potential inability of local developers to bid, project ownership, and
more.
Additional presentations and discussions were held at BEDC board meetings during which the
BEDC Board of Directors decided to form the BEDC Northwest Campus Task Force.
A Complex Issue
BEDC’s mission is “To build an economy that supports the community’s vision of a quality place
to live, work and play.” A primary role, or responsibility, of the BEDC in the process of
economy building is to undertake efforts that expand, create, or recruit primary industry to the
area. South Dakota State University is the community’s major employer and is considered a
primary industry. Accordingly, an evaluation of the proposed 300 bed apartment project and
SDSU’s role in the provision of student housing should be undertaken within the context of
SDSU’s function as a primary industry benefiting the Brookings area.
An evaluation of this nature presents numerous questions for consideration which may be
derived from factual and projected data, perceptions and skepticism, economic growth theory,
and interpretation of appropriate roles and responsibilities of public bodies. Although this type
of analysis is well beyond the scope of the committee’s intended role and budget, it is important
that a sampling of questions and viewpoints raised by the committee be noted for illustrative
purposes. These questions and viewpoints are posed from the various perspectives represented
in the discussion, as follows:
Local Developer Perspective
Does a market exist for the number of upper-class and graduate private-style upscale
apartments proposed?
Will the project be publicly or privately owned and operated?
Will the project pay property taxes on structures and some form of payment in lieu of
taxes on land that results in a level playing field with private developments?
Can the project be structured to ensure that private ownership is feasible?
Could enhanced public transportation negate the desire of students to live close to
campus?
The private sector has been a primary partner in the growth of SDSU by providing
housing for students.
City of Brookings
December 20, 2011
29
SDSU Perspective
Upper-division housing close to campus is needed to be competitive in the market
place.
Graduate students need housing in close proximity to laboratory space.
Some upper class students and transfer students desire to be close to, and participate in,
the campus experience.
Revenue generation is important to operation and maintenance programming at the
university.
Growth in upper-class and graduate students is imperative to SDSU’s desire for
increased research activity and long term university success.
Community Perspective
Brookings recognizes that most new economic growth will come from within. SDSU is
a major Brookings employer and industry.
New and emerging technologies emanating from SDSU will create new growth
opportunities.
What percentage of new student growth will SDSU capture, and what remaining
opportunity can be captured by the local development community?
The private sector has responded to the need for student housing alternatives. Some
projects should be upheld as models (in their respective day) while the quality, location,
design and safety of others are, at times, questionable.
The community is interested in retaining and building upon the current town/gown
relationship. However, it is also important for the community to grow the tax base,
protect private sector investments that contribute to the overall vision/goals of the
community, and ensure, when possible, the use of local investors and resources in
public/private development opportunities.
To what extent can SDSU’s growth potential create beneficial economic impacts for the
community and private sector that offset potential losses that may be created by SDSU
ownership of the proposed 300 bed apartment complex.
The questions stated above demonstrate the complexity of the issues that should be
investigated to properly develop a position statement based upon the merits of the proposed
project and its impact on the Brookings community. This type of analysis is beyond the scope
of the task forces mission and resources. Therefore, a recommendation by the task force
should be cognizant of, and reflect the desires of, the primary stakeholders impacted by the
proposal. These stakeholders include SDSU students, SDSU, private developers, and the
community.
Conclusions that may be drawn from the task force discussions include the following:
The task force supports the provision of quality upper-class and graduate student
housing located both near campus and throughout the community.
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December 20, 2011
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The task force supports future growth of SDSU as a primary employer and industry in
the community recognizing this growth will positively impact the community and area
economy.
The task force is cognizant of the dilemma facing SDSU resulting from state level policy
actions and budget limitations.
The task force supports the inclusion of mechanisms that promote, encourage and
facilitate private sector involvement in the concept development, planning and
implementation phases of the future growth and development of SDSU as both a public
institution and primary industry in Brookings County.
The task force recognizes the desire and willingness of the private sector to continue to
be meaningfully engaged in the process of growing SDSU.
First and foremost, the task force recognizes that Brookings and SDSU have developed
a positive town-gown relationship that must be protected and continually improved to
ensure the best future for the greater community.
BEDC Board Approved Statement November 17, 2010
The BEDC Board of Directors supports South Dakota State University’s desire for the
development of additional beds accommodating “upper-class and graduate private-style upscale
apartments, including complementary retail space”. The BEDC Board of Directors prefers that
such developments incorporate the following:
1. The design and implementation of projects that will result in private sector ownership
and management of the proposed housing in a configuration befitting a Division 1
collegiate campus, and
2. Private sector involvement in future development concepts.
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December 20, 2011
31
The following is a summary of previous City Council review of the Northwest
Quadrant issue to include final minutes of each meeting and corresponding City
Council agenda packet support.
Previous City Council Review of the Northwest Quadrant Issue:
December 8, 2009: Presentation by SDSU officials
November 9, 2010: Council request for an update
December 14, 2010: Update provided by Mayor Reed
March 8, 2011: Citizen Presentation
April 5, 2011: Item was removed from the agenda
Handout provided by BEDC
December 8, 2009
Agenda Packet:
Item #9. SDSU Northwest Quadrant Presentation.
Representatives of South Dakota State University have requested an opportunity to update
the City Council and public on University's future plans for the Northwest area of campus.
MINUTES - December 8, 2009 - The Brookings City Council held a meeting on Tuesday,
December 8, 2009 at 5:30 p.m., at City Hall with the following members present: Mayor Tim
Reed, Council Members Julie Whaley, John Kubal, Mike McClemans, Mike Bartley, Jael Thorpe,
and Tom Bezdichek. City Manager Jeff Weldon, City Attorney Steve Britzman, and City Clerk
Shari Thornes were also present.
SDSU Northwest Quadrant Presentation. South Dakota State University officials updated the
City Council and public on the University’s future plans for the Northwest area of SDSU’s
Campus. The following is a summary of their presentation:
University Rationale: Northwest Neighborhood Feasibility Study follows through on Phases I &
II of Residential Life and Dining Services Master Plan. It aligns with the University’s Strategic
Plan by enhancing student success by engaging students in campus experience, improving
retention and graduation rates, increasing graduate student enrollment, and by providing
contemporary living environments.
Northwest Neighborhood Strategic Objectives: 1) sustainable development, 2) fill gaps in
current facilities and services for campus and community, 3) create opportunities for
partnerships, 4) develop fair and equitable transaction structures, and 5) adopt consistent
architectural guidelines.
Feasibility Study -- Timeline and Milestones - Brailsford & Dunlavey (B&D), retained to
complete study January 2009.
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B&D Site Visit - March 2009: Conducted student, faculty, staff and community
stakeholder focus groups; toured SDSU and Brookings facilities; and met with
developers & banking leadership
B&D Site Visit - June 2009: Toured Agricultural Heritage Museum; Toured recently
opened apartment complexes; Met with civic/business leaders & developers
B&D Site Visit - August 2009: Reviewed preliminary report with SDSU and Brookings
leadership and developers
SDSU Participation March-August 2009: Edited and implemented student surveys;
maintained on-going communication with campus and Brookings stakeholders
B&D completes study and recommends potential development opportunities, October
2009.
Conclusions - University-Based Projects: 1) Campus Gateway - Mature trees, curved masonry
entry piers, gateway parks, 2) Historic Equine Stable - Integrate with Agricultural Heritage
Museum function, and 3) Agricultural Heritage Museum - Proposed 40,000 sq. ft. building
Conclusion – Partnerships: 1) Active Adult Community: Embraces national and regional trends
leveraging university as an asset (e.g. Dickinson State), integrates with City efforts to build
capacity for attracting this demographic, and 2) Hotel / Conference Center: Supports
identified, on-campus needs, opportunity to collaborate with community and Innovation
Campus
B&D Conclusion: The above concepts require additional detailed analysis
Apartment Complex:
Analyzed data from 2008 Residential Life and Dining Services Master Plan. Site visits to
SUNY-Buffalo, Drake, UND and NDSU. Interviews with Mankato State, USD, and the
University of Illinois. On-campus, upper-division apartment complex would improve
graduation rates.
Distributed student surveys concerning apartment configuration, features and price
points.
Conducted seven focus groups with faculty, staff, students, administrators and
community stakeholders.
Reviewed rents of 102 properties; including rental houses.
Target Market: Full-time juniors, seniors, graduate students, paying $300 - $399 per
mo./person excluding utilities (Survey Responses = 1,455).
Analysis shows target market lives 1.3 miles on avg. from campus (102 units).
Relevant comparable units analyzed – 6 new high-end complexes averaging 1.7 miles
from campus with rents at about: $1,060 per unit/per month (3 bedroom) or $353 per
person/per month, $860 per unit/month (2 bedroom) or $430 per person/month, All
rates exclude utilities
Conclusion: Demand for 88 unit (300 bed) private apartment with near campus
location and rents at about: $2,000 per unit/per month (4 bedroom) or $500 per
person/month, $1,176 per unit/month (2 bedroom) or $588 per person/per month.
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December 20, 2011
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Rents express in 2009 dollars and exclude utilities and charges for parking and other
amenities
Conclusion: Include 4,000 sq. ft. of retail to serve residential apartment.
Pro forma cost estimate = $16.9 million.
What is Next?: 1) Ongoing broad discussions on feasibility study conclusions, potential
partnerships and implementation options for each program element, 2) Draft Request for
Proposals (RFP), for review & comment for apartments that will market test the consultants’
conclusion. RFP -- A mechanism for prospective private partners to submit statements of
interest or proposals following terms established in the RFP document, and 3) Anticipated RFP
process for apartments: Submit to BOR request to proceed with RFP. Upon BOR approval
continue development of RFP process or processes. Hold pre-issue conference to refine RFP
document and process. Name review and selection advisory panel. Develop and finalize
selection criteria for RFP review. Issue RFP following Board of Regents capital project policy.
Collect and evaluate responses to RFP with input from advisory panel. Follow BOR policies to
implement if RFP process is successful. Continue investigating interest in and options for other
program elements.
Discussion: Reed asked if the trend was to have students closer to campus. Yes, having the students
closer to campus and a providing a mix of housing types is more desirable. He also asked, with the
current campus boundaries if some redevelopment of neighborhoods was being considered. Yes.
Whaley asked if the 300 unit apartment was for students only. Yes, the tenants would be upper class
and graduate students. Whaley commented she serves on the adult/assisted living board task force
and their recommendation was that the number of assisted living beds was adequate until 2021 and
questioned why the University’s statistics cited a need in 2012-13. They responded that the 2012-13
date would just be for apartment needs. The adult community work information was less detailed and
the recommendation was to continue to work with the community to determine that need.
Whaley asked how much in property taxes and other incentives would be generated by these units, or
would they be considered university owned and exempt? They responded the master developer would
be the builder/operator/owner of the apartment facility which would be subject to taxable improvement
rates. The private entity would have a ground lease with the Board of Regents.
Whaley noted many developers are building apartments and the rates and occupancy numbers are
down. She questioned if this was the right time for SDSU to get into this area or if this was just a
major plan to start with. She commented some citizens are questioning SDSU’s involvement in this
complex as well as retail uses on campus. SDSU officials said they can’t answer specifically, but it
depends on responses to the RFP. The developer would do their own market tests to determine if the
area could support this facility.
McClemans said the concept is intriguing, but his largest concern is that 53% of housing in Brookings
are rentals, which is a major cottage industry in town. These rental owners pay property taxes and
make investments. He questioned if the proposed facility would be 9 or 12 month leases? He said 9
month leases greatly affect the entire community. He noted Brookings was fortunate to have a robust
City of Brookings
December 20, 2011
34
market through the mid 2000’s and 5% vacancy was normal. However, if overbuilding occurs and
rentals don’t fill, it’s a huge problem for the entire community.
University representatives clarified the proposed facility would be 88 units housing 300 people owned
by a private developer. The University would evaluate and accept submissions based on predetermined
criteria and it will be important to have a community-based panel in the criteria development.
November 9, 2010.
Minutes – November 9, 2010. The Brookings City Council held a meeting on Tuesday,
November 9, 2010 at 5:00 p.m., at City Hall with the following members present: Mayor Tim
Reed (arrived at 5:43), Council Members John Kubal, Keith Corbett, Mike McClemans, Tom
Bezdichek, Mike Bartley and Jael Thorpe. City Manager Jeff Weldon, City Attorney Steve
Britzman and City Clerk Shari Thornes were also present.
Topics for future discussion. A motion was made by McClemans, seconded by Thorpe, to
request a report from the Mayor about the Northwest Quadrant project in the
immediate future (within two meetings). All present voted yes; motion carried.
December 14, 2010.
Agenda Packet:
Item #1 - Update on Northwest Quadrant
Mayor Reed will provide an update on South Dakota State University’s “Northwest Quadrant”
project. The update is in response to Council action at the November 9th meeting.
Overview and Status Report: SDSU Residential Life and Dining Services Master Plan
Reissued December 7, 2010
Overview of Master Plan
The SDSU Residential Life and Dining Services Master Plan was approved by the Board of
Regents in October 2008. Since the baseline primary data underlying the plan is from 2007,
these data are being refreshed. The Master Plan’s central theme is to create two student
neighborhoods — a traditional freshmen/sophomore area on the southeast side of campus
and an upper-division (junior, senior, graduate, and transfer students) on the northwest
corner. Appropriate dining operations to meet the unique needs of each neighborhood are
also elements of the plan. To create this planning framework, a housing self-study was
conducted, main campus enrollment trends were analyzed, two consultants with unique
domain expertise in university housing and associated services were engaged, and multiple
market analyses using a plethora of methods including student surveys and focus groups
were completed. Plan implementation calls for three phases. The campus map identifies the
southeast and northwest neighborhoods.
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The planning process clearly demonstrated the ―one-size-fits-all approach‖ to student housing is
obsolete. Student housing demand is best met by offering choices differentiated by amenity
and service levels and associated price points. Thus, the plan identified a need for differential
rates associated with variation in characteristics of the housing (put another way, differential
costs driven by the level of amenities) to provide students with choices in both
neighborhoods. Market analyses conducted as part of the planning process identified
amenities preferred by freshmen and sophomores for the southeast neighborhood.
Those preferred amenities on each floor include: a full kitchen, study space, laundry, social
space, natural light, and privacy in bathrooms. Another attribute strongly preferred by
freshmen and sophomores is proximity to academic buildings and other core facilities such as
the Wellness Center and Union.
An emerging demand identified during the planning process was on- or near-campus housing
for upper- division and graduate students, an underserved population in today’s residence life model.
A survey of upper-division students showed 79% of the respondents (970 of 1,277) wanted
an opportunity to spend their entire undergraduate careers in residence on-campus in a
neighborhood that met their needs. While convenience to campus was the most preferred
attribute, older students preferred a more private lifestyle experience and had little interest
in the socially-focused routines characteristic of their undergraduate on- campus residential
life experience.
The plan calls for establishing an upper-division neighborhood in the northwest corner of
campus to meet the demands of juniors, seniors, and graduate students for on-campus housing.
Market analyses identified this segment generally having strong preferences for independent
lifestyle, a private kitchen, larger bedrooms, and private or semi-private bathroom. A small
sub-segment of the upper-division student market indicated an interest in a low-cost, minimal-
amenity, single-room housing option. Upper-division and graduate students expressing the
strongest preference for this option can be described as intently focused on academics.
The dining component of the Master Plan highlights the importance of aligning appropriate
dining services in each student neighborhood for the respective market segments. The plan
identified a need for additional food-service capacity on the southeast side of campus to
accommodate the growth planned for this freshman and sophomore neighborhood. In the
northwest neighborhood, food services need to be configured and reconfigured responding to
the demands of upper-division students. The market analyses and the specialized food-service
consultant emphasized the importance of location, recommending food services be
conveniently located within each of the respective neighborhoods to best serve the market
segments. Market surveys showed a preference for upscale convenience stores, national
brands and menu choice, including lighter healthy items.
Enrollment Update
Total enrollment growth at South Dakota State University has averaged 3.7% per year 2000 to
2010, reaching a total of 12,816 in 2010. Enrollment and enrollment growth on the Brookings
campus has to be the base for residential life and dining services planning. In the spring of
2008, as part of the University’s ongoing strategic planning process, Brookings campus enrollment
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December 20, 2011
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modeling was initiated. The model developed is the Comfort Enrollment Model. The baseline
for the model is fall 2007 enrollment. The model is used to forecast Brookings campus and
total enrollment through fall 2012. The model was developed from enrollment trends for the
past five years, an evaluation of markets and market share, current and projected retention and
graduation rates, and an assessment of academic program capacity. This model yields an
enrollment increase of 18.85%, or an increase of 1,827 students, on the Brookings campus
from fall 2007 to fall 2012. Undergraduate and graduate enrollments are predicted to increase
by 16.8% (1,416 students) and 32.5% (411), respectively. The following chart shows the
Brookings campus actual enrollment for 2007, 2008, and 2009, an estimate for 2010, and
projections from the model for 2011 and 2012.
To support the planning process, Brookings campus enrollment is divided into
freshman/sophomore students required by policy to live on-campus, and
freshmen/sophomores, transfers, juniors, seniors, and graduate students who are eligible to
live off-campus. This information is provided in Table 1.
Table 1: Total Brookings Campus Enrollment
On- and Off-Campus Housing Arrangements by Student Class Level
2008, 2009 Actuals; 2010 Estimate; and 2011 & 2012 Projections
ACTUALS ESTIMATE PROJECTIONS
CLASSIFICATION 2008 2009 2010 2011 2012
Required to live on-campus
Freshmen/Sophomores Subtotal 3,418 3,229 3,680 3,784 3,896
Eligible to live off-campus
Freshmen/Sophomores* 736 959 742 810 835
Transfer Students 788 772 826 827 827
Juniors 1,674 1,680 1,744 1,836 1,929
Seniors 2,045 2,053 2,132 2,245 2,357
Graduate Students 1,347 1,579 1,604 1,643 1,674
Subtotal 6,590 7,043 7,048 7,361 7,622
Total 10,008 10,272 10,728 11,145 11,518
*Includes freshmen/sophomores released from on-campus living requirement by policy & by
waiver and non-degree students.
Brookings campus enrollment projections support implementing the University’s Residential Life
and Dining Services Master Plan. Research has shown that the availability of appropriate living
environments is significantly and positively related to student success. A strategic goal of the
University is to increase the retention rate to above 80% and the graduation rate to 60% or
higher. Implementing the Master Plan is a key to enhancing student success, increasing the
retention rate, and driving the graduation rate above 60%.
The number of transfer students enrolled on the Brookings campus averaged 766 over the five
years, 2006 to 2010, and topped at 826 in fall 2010. Research has shown that on-campus
housing is a powerful tool to help transfer students engage in campus life and achieve a higher
level of academic success.
Implementing the Master Plan provides an on-campus option for transfer students.
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A strategic goal of the University is to foster science- and technology-based economic
development. This requires faculty to continue to compete successfully for external grants and
contracts to fund research programs and to successfully recruit graduate students into
graduate assistantships. Researchers attracted more than $66 million in awards in 2009-2010,
and total research spending was approximately $67 million during the same time. In fall 2010,
580 graduate students were on assistantships, 360 of those on research assistantships. The
number of Ph.D. students grew 24%, to 286, from 2008 to 2010. Convenient housing is an
important factor considered by graduate students when selecting an institution.
Implementing the Master Plan provides another on-campus option for graduate students and
makes the University more competitive.
Implementation of Phase I
The completion of Phase I of the Residential Life and Dining Services Master Plan in 2010-2011
included the construction of the Jackrabbit Village, reprogramming Waneta Hall for upper-
division students and expanding dining services in the southeast neighborhood. The 411-bed
Jackrabbit Village for freshmen/sophomores filled in three days. To provide students with a
choice in housing prices based on the amenities offered, the following differential rate structure
was implemented in 2010-2011: a base-hall rate ($1,287), an upgraded-hall rate ($1,418), and a
premium-hall rate ($1,926 to $1,957). The differential rate structure was very positively
received.
Waneta Hall was reprogrammed for single-occupancy rooms for upper-division students
for fall 2010. Unfortunately, demand from freshmen forced the discontinuation of single-
occupancy rooms. For fall 2010, 52 juniors, seniors and graduate students selected single-
occupancy rooms before the discontinuation. A waiting list of 105 students was
established. Because of the large freshman demand, the 105 students on the waiting list
were notified in early May 2010 that single-occupancy rooms would not be available to
them.
As the two neighborhoods began to be established for 2010, evidence from housing applications
for 2010-2011 showed the strong preference of freshmen/sophomores for the southeast
neighborhood and the strong preference of upper-division students for the northwest
neighborhood. Freshmen/sophomores were more than three times as likely to request housing
in the southeast neighborhood. Conversely, upper- division students expressed a preference
for the northwest neighborhood.
Table 2 shows the fall 2010 occupancy in each residential facility compared to the capacity of
each. The table shows Waneta Hall with 160 sophomores in double-occupancy rooms and 52
single-occupancy rooms for upper division/graduate students. The Annex has been
programmed for single occupancy by sophomores for some time. In 2010, total number of
residents (demand) exceeds capacity (supply) by 8.97% (303 beds). Not considering any
enrollment growth, additional on-campus supply is needed to accommodate current demand
to achieve equilibrium.
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December 20, 2011
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Table 2: Residential Facilities Capacity
and Fall, 2010 Occupancy
Required to live on-campus (Freshmen/Sophomores)
Facility Tenants Capacity % of Capacity
Annex (singles sophomores) 49 52 94.23
Berg/Bailey (apartments sophomores) 55 0 NA**
Binnewies 512 496 103.23
Brown 404 390 103.58
Caldwell 300 300 100
Hansen 451 436 101.57
Jackrabbit Village 425 411 103.4
Mathews 370 358 103.35
Pierson 458 446 102.69
Waneta 1
6
16
0
100.00
Young 4
9
48
8
101.63
TOTAL 3,680* 3,537 104.04
Eligible to live off-campus (Upper-class/Grad Students)
Facility Tenants Capacity % of Capacity
Berg/Bailey (apartments) 279 279 100.00
Family Student Housing (apartments) 107 88 121.59
Waneta (singles) 52 52 100.00
TOTAL 438 419 104.53
*This includes a dayroom occupancy of 143; Waneta partially reverted to double occupancy
w/160 freshmen/sophomores;
Occupancy 303 > Capacity.
Implementation of Phase II
Completion of Phase I of the Residential Life and Dinning Services Master Plan began to
establish two neighborhoods focused on two distinct market segments –
freshmen/sophomores and upper- division/graduate students, respectively, in a southeast
neighborhood and a northwest neighborhood.
Phase II calls for transferring the freshman and sophomore housing capacity to the
southeast neighborhood and adding to this capacity at this location so supply meets
current demand. In the northwest neighborhood, additional single-occupancy rooms
and an upscale contemporary-style apartment option will address the demands from
upper-division/graduate students.
Based on fall 2010 enrollment, an additional supply of 739 new beds is needed to meet the
current demand from freshmen and sophomores in the southeast neighborhood and establish
equilibrium. To mitigate the risk of an unforeseen decline in enrollment, the recommendation
City of Brookings
December 20, 2011
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for Phase II is an increase of 500 new beds in the southeast neighborhood for freshmen and
sophomores.
To implement Phase II in the northwest neighborhood, 350 single-occupancy rooms will be
available for upper-division students — 218 and 80 rooms in Hansen and Waneta Halls,
respectively, will be added to the 52 rooms in Waneta Hall deployed in 2010 as single-
occupancy rooms for upper-division students. The 52 rooms in the Annex occupied by
sophomores will continue. Of the 350 single-occupancy rooms, 187 would be reserved for
academically strong sophomores (taking demand pressure off of the southeast neighborhood)
and 163 would be allocated to upper-division/graduate students. The Berg/Bailey apartments
would accommodate 320 upper-division students with no sophomores in these facilities as in
2010. (In 2010, 55 sophomores are in the apartments because of capacity limitations in other
halls.) The proposed upscale, private, contemporary-style apartment would be configured and
sized to meet market demand via a request for proposal (RFP) process. When completed, this
apartment would provide an additional on-campus option for the upper-division/graduate
student market segment.
Minutes – December 14, 2010 - The Brookings City Council held a meeting on Tuesday,
December 14, 2010 at 5:00 p.m., at City Hall with the following members present: Mayor Tim
Reed, Council Members John Kubal, Keith Corbett, Mike McClemans, Tom Bezdichek, Mike
Bartley and Jael Thorpe. City Manager Jeff Weldon, City Attorney Steve Britzman and Deputy
City Clerk Bonnie Foster were also present.
Update on Northwest Quadrant. Mayor Reed provided an update on SDSU’s Northwest
Quadrant project. He has also invited SDSU staff to February Council Retreat to provide
additional updates.
March 8, 2011
Agenda Packet
Item #17. Citizen presentation on proposed SDSU Northwest Quadrant Project.
Per the enclosed letter, John Mills and Jim Flippin have requested time on the meeting agenda to
discuss this issue with the City Council.
Minutes - March 8, 2011. The Brookings City Council held a meeting on Tuesday, March 8,
2011 at 5:30 p.m., at City Hall with the following members present: Mayor Tim Reed, Council
Members John Kubal, Mike McClemans, Tom Bezdichek, Mike Bartley, Jael Thorpe and Keith
Corbett. City Manager Jeff Weldon, City Attorney Steve Britzman and City Clerk Shari
Thornes were also present.
Citizen presentation on proposed SDSU Northwest Quadrant Project. A number of individuals
presented information and expressed concern regarding the proposed impact the SDSU NW
Quadrant will have on the private business sector in Brookings.
City of Brookings
December 20, 2011
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April 5, 2011
Agenda Packet
(This item was removed from the agenda – no action was taken.)
Other Business
Item #17. Action on Resolution No. 47-11, a public request for position on SDSU Northwest
Quadrant.
The City has received a draft resolution from developers in the community requesting the
Council’s adoption of said resolution in opposition to the Northwest Quadrant project.
Resolution No. 47-11 - Resolution pertaining to the SDSU Northwest Quadrant Project
Whereas, the City of Brookings encourage the South Dakota Board of Regents, as they review
and oversee the activities of South Dakota colleges and universities, to work with the university
system to avoid unwarranted expansion into activities that compete with the private enterprise,
business commerce, and economic development efforts of South Dakota’s communities; and
Whereas, the City of Brookings encourage the Board of Regents to be mindful of the potential
property tax revenue losses, so critical to support our K-12 schools, as well as local
governance revenue needs, that these intrusions represent and to override any expansions into
these areas that have not had significant local review/input and do not finally carry broad local
and non-institutional support.
Now, Therefore, Be It Resolved that the City of Brookings opposes the SDSU Northwest
Quadrant Project due to the potential effects it would have on the Brookings Community.
Handout from BEDC.
Brookings Economic Development Corporation - Northwest Campus Task Force Position
Recommendation: In April, 2010 a task force of BEDC members was created and charged
with the following task: To determine if the BEDC Board of Directors should consider
taking a position on the NW Campus 300 bed apartment building project, and if so, what
should that position include.
Task Force should consider:
The need for housing
Housing alternatives
Appropriate locations
Impact on SDSU
Impact on the community
Factors related to fair competition
Prior to providing a recommendation to the BEDC Board of Directors for consideration,
it may be useful to provide first, a brief overview of events leading to this
recommendation, and second, a brief summary of the complexities involved in considering
a position on this topic.
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December 20, 2011
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Overview of Events
In September 2009 South Dakota State University unveiled a concept plan for the
northwest corner of the SDSU campus. This plan document represents one component
of a master plan development concept for SDSU. The concept plan is depicted in the
"Northwest Quadrant Mixed-Use Development Feasibility Study Final Report" prepared by
Brailsford and Dunlavey. The report suggests a market exists for the establishment of an
"upper-class and graduate private-style upscale apartment including complementary retail
space." Although the feasibility study introduces additional recommendations for student
apartments, retail, active adult housing, and a hotel conference center; the task force
considered only that portion of the student housing currently In question, the 300 bed
upper-class and graduate facility.
During the month of November 2009, BEDC conducted two meetings with local
developers to listen to their thoughts on the Northwest Quadrant study. The initial
meeting was a "developer only" meeting intended to provide developers with a forum
to express their support or concerns for the proposed project. The second meeting
was organized to provide President Chicoine, SDSU personnel and developers an
opportunity to engage in discussion and questions related to the project, process and
timing. Developer concerns addressed during the sessions included topics such as the
potential for unfair competition with a public entity involved, market vacancy rates, a
changing role and mission for SDSU, tax loss concerns, the bond financing process and
potential inability of local developers to bid, project ownership, and more.
Additional presentations and discussions were held at BEDC board meetings during
which the BEDC Board of Directors decided to form the BEDC Northwest Campus
Task Force.
A Complex Issue
BEDC's mission is "To build an economy that supports the community's vision of a quality
place to live, work and play." A primary role, or responsibility, of the BEDC in the process
of economy building is to undertake efforts that expand, create, or recruit primary
industry to the area. South Dakota State University is the community's major employer
and is considered a primary industry. Accordingly, an evaluation of the proposed 300 bed
apartment project and SDSU's role in the provision of student housing should be
undertaken within the context of SDSU's function as a primary industry benefiting the
Brookings area.
An evaluation of this nature presents numerous questions for consideration which may
be derived from factual and projected data, perceptions and skepticism, economic growth
theory, and interpretation of appropriate roles and responsibilities of public bodies.
Although this type of analysis is well beyond the scope of the committee's intended role
and budget, it is important that a sampling of questions and viewpoints raised by the
committee be noted for illustrative purposes. These questions and viewpoints are posed
from the various perspectives represented in the discussion, as follows:
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December 20, 2011
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Local Developer Perspective
Does a market exist for the number of upper-class and graduate private-style
upscale apartments proposed?
Will the project be publicly or privately owned and operated?
Will the project pay property taxes on structures and some form of payment in lieu
of taxes on land that results in a level playing field with private developments?
Can the project be structured to ensure that private ownership is feasible?
Could enhanced public transportation negate the desire of students to live close to
campus?
The private sector has been a primary partner in the growth of SDSU by providing
housing for students.
SDSU Perspective
Upper-division housing close to campus is needed to be competitive in the market
place.
Graduate students need housing in close proximity to laboratory space.
Some upper class students and transfer students desire to be close to, and
participate in, the campus experience.
Revenue generation is important to operation and maintenance programming at the
university.
Growth in upper-class and graduate students is imperative to SDSU's desire for
increased research activity and long term university success.
Community Perspective
Brookings recognizes that most new economic growth will come from within. SDSU is
a major
Brookings employer and industry.
New and emerging technologies emanating from SDSU will create new growth
opportunities.
What percentage of new student growth will SDSU capture, and what remaining
opportunity can be captured by the local development community?
The private sector has responded to the need for student housing alternatives. Some
projects should be upheld as models (in their respective day) while the quality,
location, design and safety of others are, at times, questionable.
The community is interested in retaining and building upon the current town/gown
relationship.
However, it is also important for the community to grow the tax base, protect
private sector investments that contribute to the overall vision/goals of the
community, and ensure, when possible, the use of local investors and resources in
public/private development opportunities.
To what extent can SDSU's growth potential create beneficial economic impacts
for the community and private sector that offset potential losses that may be
created by SDSU ownership of the proposed 300 bed apartment complex.
The questions stated above demonstrate the complexity of the issues that should be
investigated to properly develop a position statement based upon the merits of the
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proposed project and its impact on the Brookings community. This type of analysis is
beyond the scope of the task forces mission and resources. Therefore, a
recommendation by the task force should be cognizant of, and reflect the desires of, the
primary stakeholders impacted by the proposal. These stakeholders Include SDSU
students, SDSU, private developers, and the community.
Conclusions that may be drawn from the task force discussions include the following:
The task force supports the provision of quality upper-class and graduate
student housing located both near campus and throughout the community.
The task force supports future growth of SDSU as a primary employer and
industry in the community recognizing this growth will positively impact the
community and area economy.
The task force is cognizant of the dilemma facing SDSU resulting from state level
policy actions and budget limitations.
The task force supports the inclusion of mechanisms that promote, encourage and
facilitate private sector involvement in the concept development, planning and
implementation phases of the future growth and development of SDSU as both a
public institution and primary industry in Brookings County.
The task force recognizes the desire and willingness of the private sector to
continue to be meaningfully engaged in the process of growing SDSU.
First and foremost, the task force recognizes that Brookings and SDSU have
developed a positive town-gown relationship that must be protected and continually
improved to ensure the best future for the greater community.
BEDC Board Approved Statement November 17, 2010
The BEDC Board of Directors supports South Dakota State University's desire for the
development of additional beds accommodating "upper-class and graduate private-style
upscale apartments, including complementary retail space". The BEDC Board of Directors
prefers that such developments incorporate the following:
1. the design and implementation of projects that will result in private sector ownership
and management of the proposed housing in a configuration befitting a Division I
c ollegiate campus, and
2. private sector involvement in future development concepts.
Minutes - April 5, 2011. The Brookings City Council held a meeting on Tuesday, April 5,
2011 at 5:00 p.m., at City Hall with the following members present: Mayor Tim Reed, Council
Members John Kubal, Mike McClemans, Tom Bezdichek, Mike Bartley, Jael Thorpe and Keith
Corbett. City Manager Jeff Weldon, City Attorney Steve Britzman, and City Clerk Shari
Thornes were also present.
REMOVED FROM AGENDA: #17. Action on Resolution No. 47-11, a public request for
position on SDSU Northwest Quadrant.
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Other Business
10. Review of Liquor Store draft Request for Proposal.
TO: Mayor and City Council Members
FROM: City Manager Jeff Weldon
RE: Discussion for developing a Request for Proposal (RFP) for the possible
divestiture of the Municipal retail liquor operation
Pursuant to your direction of the Council work session of November 15, 2011, I was directed
to identify various policy issues and considerations that would need to be inserted into a draft
Request for Proposal for potential private operators so they may respond with proposals to
become license holder(s) for retail liquor sales in the City of Brookings.
Attached is my staff memo from the November 15th council work session as background
information for continued reference for your discussion.
Issues that comprise the RFP
The following are items which will need to be resolved/answered by the Council before they
could be inserted into an RFP:
1) Determine model of governance; (decide on Options 1-6 on from the November 15th
memo if we are going to change from Option 7.)
2) Determine whether or not the issuance of retail license(s) will be exclusive or non-
exclusive. If non-exclusive, how many? This solution could also be a hybrid offering
exclusive for so many years and then non-exclusive after that.
3) Determine the liquor fee for a retail license(s) beyond the state fee. Is the fee
expressed as an annual or multi-year fee? If multi-year, how many years? What are the
criteria upon which a fee is based? A public hearing should be held prior to adopting a
fee.
4) Determine the process and evaluation criteria for awarding a license. What information
will be required for the application? What will the schedule be for such evaluation and
who will do that?
5) If any changes are to involve the existing store, how will that affect the current lease
obligations?
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6) If any changes are to involve the existing store, will we sell or lease the existing
equipment, furnishings, fixtures, and other leasehold improvements or do we sell them.
If we sell them, we must declare them surplus property and follow state law providing
for the disposal of surplus equipment which could include sealed bids or auction
(depending upon value of items). Present book value of the larger capital assets is
$293,000. NOTE: This provides no guarantee that the intended retail operator will
end up with the equipment. Such items include coolers, forklift, shelving, counters,
office furniture, cash registers, point-of-sale equipment, carts, display gondolas, signage,
lights, and some HVAC equipment.
7) What is the override rate expected to be? (Presumably the same 10% and 11%.)
8) What is the overall schedule for advertising, reviewing, and selecting qualifying
proposals?
9) To whom, where, and how do we advertise and distribute the RFP?
10) When and how will any changes take effect?
Each of these questions, and possibly others that develop during the course of the Council’s
deliberation, will need to be addressed as they would need to be answered in the RFP.
Best revenue scenario: current model or all override
In my opinion, the overriding issue should be what is in the best financial interest of the City of
Brookings. If we are convinced other options will be more financially beneficial than what we
are currently doing, then we should make the change. Until we can be assured of that, we
should continue on our current path. Toward that end, the question becomes: Can the City of
Brookings realize more revenue from charging an override on the sale of distilled spirits by private
retailers, or are we financially better off with the current arrangement?
The line graph illustrates an extremely conservative projection comparing the current municipal
operation of net profits with override gained from a private retail operation if that operator
purchased the identical amount of inventory. In order for the City to raise override revenue to
match our net profit from city retail sales, the third party would need to sell in excess of
$350,000 more annually in gross sales. A scenario that is highly unlikely. Clearly, we are better
off under our current arrangement.
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2009 2010 2011 2012 2013
Actual Actual Projection Projection Projection
Liquor Store Net $ 326,803.00 $ 355,147.00 $ 323,688.00 $ 322,262.00 $ 328,448.00
Override Only $ 263,285.00 $ 274,693.00 $ 283,551.00 $ 284,000.00 $ 290,500.00
Lost Income $ 63,518.00 $ 80,454.00 $ 40,137.00 $ 38,262.00 $ 37,948.00
Lease or own a municipal store
In addition, we have revisited the issue of renting versus ownership and how that consideration
enters into our financial interest. Renting is very common in any retail business model and
issues such as location are of paramount importance to retail/service businesses. It is
frequently not possible to own suitable space, at a reasonable price, in a desired location so
renting becomes a viable option. What’s more, renting a “vanilla shell” with the tenant
outfitting the space with leasehold improvements is likewise very common. Owners can also
outfit leased space, but they will include those upcharges in the base lease so the tenant will still
pay for them.
In the market in which our lease was signed, and even today, we have a very good and fair
lease. The time to consider building a store is after we have depreciated out the
improvements. Currently, we are one-third through our lease-plus-option so we have a long
time to depreciate our leasehold improvements. With so much useful life yet in them, it makes
no sense to duplicate these expenses in a different store. Depending upon the store, only
some of them may be re-usable in a new store.
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Over the course of 20 years, if we stay at the current store, we would pay approximately
$1,759,000 for the location. Over that same 20 years, if we were to build a new store valued
at $2 million with another $100,000 for a desirable two acre property purchase with utilities
and site work, and financed it at a favorable interest rate of 3.5 percent, that same store would
cost approximately $2,923,000.
That is an increase of identical stores of approximately $1,164,000 in owning instead of our
current lease.
By way of process, if we are to continue, I suggest we return to the top of this memo and begin
by discussing the listed ten questions and develop answers so I know how to proceed.
Liquor Fund 2009 Actual 2010 Actual 2011 Actual 2012 Budget 2013 Project
Transfer to Other Funds $420,000 $500,000 $700,000 $725,000 $746,750
2001 2002 2003 2004 2005
Liquor Store Net $ 100,483.13 $ 115,643.20 $ 133,524.90 $ 178,041.94 $ 203,253.81
3rd Party $ 142,062.75 $ 144,792.16 $ 161,022.72 $ 175,625.61 $ 183,221.80
Difference ($41,579.62) ($29,148.96) ($27,497.82) $2,416.33 $20,032.01
2006 2007 2008 2009 2010
Liquor Store Net $ 134,520.97 $ 105,292.00 $ 218,807.00 $ 321,803.00 $ 355,147.00
3rd Party $ 217,615.61 $ 225,877.00 $ 256,756.00 $ 263,285.00 $ 274,693.00
Difference ($83,094.64) ($120,585.00) ($37,949.00) $58,518.00 $80,454.00
Liquor Store
Move
Building
inventory
Building
inventory
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City of Brookings
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49
November 15, 2011 Council Packet Agenda Item #2
#2. Discussion regarding Brookings Municipal Liquor Store
TO: Mayor and City Council Members
FROM: City Manager Jeff Weldon
RE: Information pertaining to Brookings Municipal Liquor Store
During the September 27th Council meeting work session, you directed staff to assemble some
information pertaining to options for management and operations. Attached are the minutes
from that work session discussion as a reminder.
Models of Operation
A central theme which seemed to be the genesis of this issue has to do with the various
governance and management options of an off-sale liquor enterprise in the community. Also
attached is the report commissioned by the City Council in 2003 “Review of Brookings
Municipal Liquor Store” by Lyndon M. Griffin. Section IV, Options and Recommendations (C)
Privatization on pages 11-14 provide information and analysis pertaining to the various options
other than municipal operations. Generally, the various options of governance are as follows:
1) Sell the operation and issue an exclusive off-sale license to one private operator.
2) Sell the operation and issue multiple off-sale licenses to as many operators as the
Council deems appropriate.
3) Retain ownership of the operation and turn over operations through a management
agreement to a private operator with a payment to the City prescribed through a
manner, method, or formula specified in the contract.
4) If the Council wishes to increase the number of locations, additional municipal off-
sale stores could be developed.
5) When the current lease expires, do not renew the lease but instead build/own a
new municipal store at a different location.
6) Continue to operate our own municipal off-sale, but also issue private off-sale
licenses.
7) Change nothing; maintain the status quo.
Page 19 provided a recommendation of retaining the municipal operation model and suggested
a new location and operational changes to increase profitability by adjusting gross profit
margins.
“. . . The operation is very stable and well managed regarding all operating expenses.
Substantial additional profits can be attained by adjusting gross profit margins and/or
relocating to an expanded facility in a high traffic flow site and consumer visibility.
There appears to be no significant financial reason to sell the business or subrogate to a
management contract. The City would greatly benefit from maximizing the success of
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the current operation. Continuing city operation of the store appears to be the best
way to insure the City’s ‘control’ responsibility of avoiding sales to minors and/or
intoxicated persons.”
If the City Council wishes to return to the consideration of the options of ownership/operation
models, the descriptions in Section IV are instructive.
The strength of a chain liquor store, such as Surdyk’s or MGM Liquor Warehouse, provides
higher name recognition, and I am unaware if they would look at a market this small. Typically,
such chains will require larger, metropolitan areas. Even so, such chains typically send their
profits to their headquarters and are not reinvested where they are earned.
Cost of owning property for a municipal liquor store
Following the Griffin report, the City Council subsequently entered into a lease at the
Brookings Mall for 12,500 square feet of retail space and moved the store. The 10-year lease
expires in 2016 with an option to renew for a five-year term with the identical terms and
conditions. The first year lease cost was $76,000, and it contains an escalator of two percent
per year. By the end of the initial 10-year term, the lease will cost $744,412 after some rebate
adjustments. We pay our own utilities, but the parking lot is included in the rent. We also
have common area maintenance (CAM) costs in addition to the rent which can vary slightly
from year to year and are standard for retail rental in malls. We used the net sales proceeds
from the sale of the old store to generate approximately $300,000 to invest in leasehold
improvements, furnishings, fixtures, and equipment outfitting the new store. The assertion was
also previously raised that as much as $500,000 of General Fund was used for improvements to
the new store. This is not correct. No General Fund revenue has been used to pay for any
portion of the new store.
Alternatively, if we were to replace the rental store with an owned facility, we can expect to
have approximately $100 per square foot in construction costs for commercial space. To
duplicate an owned facility with 12,500 square feet would cost just over $2 million for basic
construction, fees, contingency, furnishings, fixtures, and equipment but excluding land, utilities,
and site work.
Cost Accounting Charge to Override Operation
The liquor budget contains a line-item cost charged against the override part of the operation
in the amount of $40,000 per year. This is the only cost charged against this revenue stream.
The purpose is to charge to the override revenue the cost of financial administration of the
override by the various staff who process the override. Managing the override is a detailed
financial and time-consuming process and true cost accounting practices dictate that costs
incurred as a result of managing this service be charged against that service. This amount was
established several years ago as a result of an estimated time management study, and the
amount has never been adjusted. This charge means the override pays its fair share and is not
unduly subsidized by the Retail side of the liquor operation.
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As a result of this issue being questioned, staff has undertaken another time management study.
The following are salary/benefit costs of various employees associated with accounting for the
override:
1. Liquor store clerks per week $ 84.35
2. Finance Accounting Clerk per week $ 55.44
3. Liquor Store Accountant per week $666.88
4. Liquor Store Manager per week $ 81.88
TOTAL $888.55
X 52 weeks
$46,204.60 per year
In order to have an accounting system with sufficient internal controls, several employees are
utilized for cross-checking and verification of the process. In order to effectively account for
the true cost of processing the override, the retail should be charging the override an additional
$6,204 per year beyond what is currently charged.
Operational Transfers
The attached chart indicates the history of the transfers from the liquor operation to other
funds. The transfers have greatly helped supplement the General Fund with an alternative
revenue stream aiding in general operations of the City. The transfer has also assisted with
providing capital loans to the golf course for new mowers and the Street Department for a
grader replacement. The transfer also helps with cash flow for the golf course operations; a
subsidy which otherwise would be necessary from the General Fund. Liquor store transfers
can be viewed as a ‘shareholder dividend’ being paid back to the owners since it is a
reinvestment in other City operations and services. The transfer comes from both the
Override and Retail sides of the operation.
For 2012, the total net profit from the override and retail operation was $828,326 of which 43
percent was generated from the retail operation and 57 percent was generated from the
override; and made a combined transfer of $500,000. For 2011 and 2012, the transfers are
$700,000 and $725,000 respectively. If we do not have a municipal retail operation, we lose
that 43 percent transfer, or $215,000, $301,000, and $311,750 respectively. If we change our
governance structure in favor of a private arrangement, we need to determine a method to
replace this revenue stream as the General Fund is heavily dependent upon it. Wholesale
purchases by a private off-sale store would also pay the override, so there would be a revenue
increase from this. Whether or not the replacement override from private off-sale stores
would be more or less than the net profit from a municipal off-sale is speculative, at best.
Profit Goal Established and Attained
The City Council established a profit goal of eight percent on net sales from the retail
operation. Historically, profitability at this level had been sluggish at the old store, which was
one of the reasons the Council re-evaluated the operation which precipitated the Griffin Study.
After the re-location, profitability began to improve with the new location, but marketing,
customer acclimation to a new location, and ‘ramp-up’ to a certain degree, suppressed
profitability as is to be expected with such changes. Upon immediately being given this
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profitability goal from the City Council, we instituted some operational changes to reduce
expenditures and increase revenue. Within three quarters, the goal of eight percent net profit
was realized and has been there ever since. Our highest quarter was 2009 fourth quarter when
our net profit was 12.63 percent. This goal was met in the face of increased wine licenses
issued to other retailers thus increasing competition. I am convinced our net profit would be
even higher if we had not approved private wine licenses. Some of those operational changes
included: increased and more aggressive marketing and advertising; reducing staffing by
downgrading the Assistant Manager position to a Head Sales Clerk position; not filling a vacant
sales clerk position via attrition; more efficient staffing and scheduling; increasing store hours on
Sundays; more effective promotion of sales and specials; and perhaps most importantly,
implementing industry standards for inventory pricing.
Because of these operational changes, we now have more net sales revenue from the retail
operation than we would likely have if we were to charge the same level of purchases to a
private store through the override.
Industry Standards for Certain Operational Benchmarks
In addition to net profit, there are other metrics that should be examined.
The Griffin Study suggests the industry standard for gross profit of retail stores should be at 25
percent (p.3). At the old store, the gross profit was 19 percent as noted in the study. For
2010, the current store was at 25.28 percent.
The Griffin Study also suggests advertising be budgeted at one percent of gross sales (p.4). For
2010, we spent $25,000 on $3,626,713 of gross sales which is exactly one percent. For 2011,
we budgeted $30,000 in advertising.
The Griffin Study further suggests employee cost ratio as a percentage of sales should not
exceed 10 percent (p.4). For 2010, our personnel costs exceeded this target level at only nine
percent. For year-to-date 2011, we are running at exactly 10 percent.
Customer Satisfaction Survey
Previously, the Council briefly discussed the possibility of undertaking a customer service /
satisfaction survey; and that our website could be used to do that. Unfortunately, use of
websites for public opinion surveys are not very scientific, and therefore do not provide much
usefulness for such information in this process. We would need to undertake a process that
was scientifically valid and statistically reliable for such an exercise to be of any value, and the
Council has not yet authorized such a project.
Consideration of Additional Off-Sale Retail Outlets
As Brookings continues to grow, the question can be asked as to whether or not we are large
enough to support additional retail outlets at different locations around the community.
Obviously, communities much smaller than Brookings have more than one retail outlet for
spirits. We already have numerous retail outlets for beer and wine. This becomes an issue of
market size and demographics. The answer to this question is beyond the scope of this memo,
but the question should probably be pursued.
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If the City were to consider additional off-sale locations, or any partnership with a management
contract for additional locations, commissioning another study would probably be advisable.
Without the benefit of quantifiable data from a study, my speculation is that additional municipal
off-sales would not be profitable as operating and capital expenses would likely exceed revenue.
If the City were to get out of the municipal operation and opt for private liquor stores by
issuing multiple off-sale licenses to the private sector, that will be for the market and the private
sector to determine.
If we chose the latter, we would then have to face the issue of establishing a liquor license fee
for an off-sale liquor license.
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Other Business
11. Discussion and possible action regarding The Shamrock &
Tappers Bar and Grill Liquor Operating Agreement, Michael D.
Bailey, owner, Block 1, Hyland Addition, 2201 22nd Avenue South,
Brookings.
The Council will discuss and take possible action on the disposition of the liquor
operating agreement held by The Shamrock and Tappers Bar and Grill, which expires
December 31, 2011. As of this date, the business has not submitted its 2012 On-sale
Liquor License application or annual $1,500 fee payable to the City. No sale of alcohol
will be allowed beyond midnight of December 31, 2011. Pursuant to the City Council’s
policy regarding Liquor Operating Agreements, failure to use an agreement is grounds
for termination. The City Manager is required to report any inactive operating
agreements to the City Council to consider the circumstances and for appropriate
action.
City Council Policy
Liquor Operating Agreements
Adopted August 13, 2001
The City of Brookings is the holder of State Liquor Licenses for the sale of alcoholic beverages. The City
of Brookings enters into operating agreements with business owners permitting them to sell alcoholic
beverages purchased from the City. The City of Brookings established a policy for the consideration of
additional operating agreements with the City. The policy establishes the criteria for applying for an
available, but un-issued operating agreement. This addition to that policy will clarify the City Council’s
policy on the consideration of changes in existing operating agreements.
1. It is not the City’s intention to allow operating agreements to be sold.
2. It is not the City’s intention to have issued operating agreements be unused by the manager. Failure
to use the agreement will be grounds for termination by the City. The city manager will report any
inactive operating agreements to the City Council to consider the circumstances and for appropriate
action.
3. Operating agreements are not assignable or transferable to another person or location by the named
manager; only the City Council can assign or transfer an agreement to another person or location.
4. The purchaser of an establishment holding an operating agreement must apply for an assignment of
that operating agreement. It is the City’s intent to allow an assignment of an operating agreement to
an applicant that passes the “character of the applicant” requirement as a new owner of an existing
business in the same location.
5. The owner of an establishment holding an operating agreement must apply for an assignment of that
operating agreement if there is a desire to move the business to a different location. It is the City’s
intent to allow an assignment of an operating agreement to a new location providing the location is
suitable, “second tier criteria” is considered and the business identity is the same as in the initial
application.
6. Unless the circumstances are as described in number 4 and 5 above, it is not the City’s intent to
allow the assignment of an operating agreement from one business to another or one location to
another. In these instances, an application for a new operating agreement is necessary.
City of Brookings
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If the City terminates the agreement with the Shamrock, the remaining $22,500 of the
operating agreement, less any outstanding debts to the City, will be refunded to the
owners.
Staff recommends the following options for City Council consideration if the agreement
is terminated:
#1. Put license on shelf
#2. Consider previously submitted applications for issuance at the currently
established rate of $100,000
#3. Consider new applications by reopening the process at the currently established
rate of $100,000
City Manager Introduction
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12. Adjourn