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The fate of the long awaited 150 Thompson project will come down to how City Council wants to handle any potential prevailing wage exemption, which will be discussed during the Open Council Work Session before the regular meeting.
Note: Next week’s meeting is on Tuesday instead of Monday due to Indigenous Peoples’ Day.
150 Thompson Discussion
After multiple delays, the 150 Thompson project will come forward for approval and debate. But it all hinges on the Open Council Work Session (OCWS) discussion and how City Council wants to handle the prevailing wage requirement and potential exemptions.
- Background: This summer, the Council narrowly approved a change to the city’s prevailing wage ordinance that strengthens requirements and enforcement, but also allows for narrow exemptions for projects with major public benefits. In short, the Council can choose to relax the prevailing wage requirement in order to make projects financially feasible. It’s worth noting West St. Paul is one of only a handful of cities in Minnesota with a prevailing wage ordinance.
- Project: The proposed redevelopment includes 457 market rate apartments, 19 townhomes, a retail building that will include a sit-down restaurant, and a 2.48 acre park.
- Options: City staff will present two options to Council:
- 1. Nearly all union work, but the park is minimal—just the grading, utilities, stormwater, and parking lot. No amenities. Those would have to be added later with city funds.
- 2. 85-88% union work, but that 12-15% would comprise four trades that have a minimum pay lower than prevailing wage–by about $30 per hour on average.
- A third option would be to kill the project and start over. That would require the city to pay off $6.3 million in bonds by February 1. City Manager Nate Burkett has a plan for that scenario—”It’s not ideal, but it’s not impossible,” he said.
- At issue:
- How much public benefit can the city get? The city owns the property, which has allowed them to dictate the terms of development. They’re getting a restaurant and a park out of the deal. But how much park can the city get without burdening taxpayers?
- What if the city didn’t own the property? It would probably be an affordable housing development, according to Burkett. There would be no park. And the restaurant?Burkett said based on at least a dozen interested parties in the last few years, it would probably be a used furniture or mattress store.
- What would workers be getting if this project were in another city? “The city wouldn’t know or particularly care,” Burkett said. Most cities don’t have a prevailing wage ordinance, so there is no protection for wages or transparency into the process.
- What about the developer? “I have squeezed the developer as hard as I possibly can, and there just isn’t anything left to squeeze,” Burkett said. The developer, Greco, has a projected return on investment of approximately 6.4% (7% is typical) and developer fees at about 2-3% (2-5% is typical).
- What’s next: Council will give direction on the prevailing wage exemption during the OCWS and consider rezoning, site plans, and other applications during the regular meeting. But the development agreement and tax increment financing (TIF) will be pushed to October 27.
Other Items on the Agenda
- Parking restrictions: As part of the coming Emerson Avenue project, Council will consider parking restrictions.
- Road work: Council will hold a public hearing for next year’s mill and overlay project, which includes a section of Emerson Avenue east of Oakdale and a series of nearby streets, including Sperl, Logan, Stassen, Kopp, and Moreland Court.
- Marijuana: There will also be public hearings for two minor changes to bring the marijuana ordinances in line with state law.
Engage
- Watch: The public can watch the meeting live on Town Square TV or cable TV starting at 6:30 p.m. (5:45 p.m. for the OCWS) on Tuesday.
- Learn more: Guide to West St. Paul City Council.
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