City Council Meeting Date: November 12, 2024
To: Mayor and City Council
From: Jake Reilly, Community Development Director
Mikayla Schmidt, City Planner
Nate Carlson, Economic Development Coordinator
Ben Martig, City Administrator
Title
Review and Discussion of Amendments to Chapter 34 - Land Development Code Related to Industrial and Agricultural Use Regulations and Re-zoning of Property.
Body
Action Requested:
Review and discuss proposed text amendments to the Land Development Code, specifically related to the I1-B Industrial, A-S Agricultural, and the ED-F Economic Development Floating districts.
Summary Report:
The City of Northfield has been planning for the development of the Northwest Area in addition to other redevelopment and infill site strategies consistent with the adopted Comprehensive Plan (2008) (Attachment 1) and the City’s Strategic Plan (Attachment 2) related to tax base growth.
Guidance for development of the Northwest Area is being explored in conjunction with the Comprehensive Plan update. Although delayed by COVID and other priorities, since 2023 City staff have been working toward the recommended incremental approach to development in the area, memorialized in Resolution 2019-008 (Attachment 3).
How land is used and where those uses are in relationship to people, goods, and services is an important consideration in comprehensive planning. As the city works through the 2045-horizon comprehensive plan alongside a focused initiative to diversify the tax base in the city by taking a data-driven approach, the City Council, as advised by the Economic Development Authority (EDA) and the Planning Commission, has a role in guiding that work.
To inform that work, in the fall of 2023, the Northfield City Council commissioned and subsequently adopted an Alternative Urban Areawide Review (AUAR) for an area of approximately 787 undeveloped acres (530 acres in the city limits and the remainder in Greenvale Township) northwest of downtown and west of the Northfield Hospital complex. The AUAR is a unique-to-Minnesota environmental review process intended to evaluate cumulative impacts under multiple development scenarios, including the existing scenario described in the 2008 Comprehensive Plan, and consider mitigation strategies. The two scenarios in the AUAR reflect that intent. Since adopting the AUAR, site selectors have been expressing more interest in the site and several landowners in the area are willing participants in that conversation. More information about the AUAR and the document itself are available on the City’s website (Attachment 3).
Existing industrial-use areas do not have particularly strong guidelines that are specific to industrial site development, design elements, consideration of sustainability concerns, or compatibility with surrounding uses. In an effort to focus recruitment efforts for potential new and/or expanded industrial uses citywide, and to ensure those recruitment efforts can be effective and can accurately reflect the current strategic and comprehensive goals of the city related to expanded/diversified tax capacity and tax base, climate change mitigation, resiliency, and economic success, staff has drafted updated definitions and criteria for industrial uses, particularly regarding design and performance standards.
Additionally, the State Legislature passed laws in 2023 legalizing and establishing a process for the licensing of recreational cannabis. Those laws go into effect January 1, 2025, and the city has taken an incremental approach to drafting its land development code regulations to the use, sale, and production of recreational-use cannabis products. These code amendments address potential industrial, agricultural, and college use (as accessory) regulations only. Amendments regarding potential retail and commercial uses will be forthcoming.
Background
Northfield annexed approximately 530 acres in 2009 for commercial and industrial development just west of the Northfield Hospital; annexing additional land for commercial and industrial development was identified in the 2006 Comprehensive Economic Development Plan. To date, no development has occurred in this area except the installation of commercial solar farms, which require a conditional use permit.
Since being annexed, the land in the Northwest Area retains an agricultural zoning designation representing the existing use. However, based on guidance in the adopted 2008 Comprehensive Plan - under which the city continues to operate until the 2045-horizon Comprehensive Plan can be adopted; scheduled for December 2024 - the zoning is intended to be an interim zoning classification until such a time as rezoning the area to an industrial or mixed commercial-industrial use is advised. Some uses allowed in the agriculture zone other than crop raising and residences include commercial solar farms and community solar gardens, aggregate extraction/mining, and schools.
Updated zoning regulations for the City were adopted in 2011 and included a zoning classification intended for this area known as the Economic Development Floating Zone or ED-F special zoning district. Although a draft Master Plan for a business park in this area was prepared in 2011, it was not adopted. That draft Master Plan and the ED-F district both describe a mix of uses that appear to run counter to the intent of the 2006 Economic Development Plan and the 2008 Comprehensive Plan, both of which describe a stated desire to focus on infill sites close to the historic downtown core prior to developing or redeveloping in the identified priority growth areas. In 2011 a master planning process for the area was completed, although the plan was not adopted due to concerns that the mix of uses contemplated was too broad and therefore counter to the 2006 Comprehensive Plan direction to develop compactly and focus on the developed area closer to the downtown core first.
Other decisions made by the Planning Commission and City Council also reflect an interest in this area developing or redeveloping primarily for the purpose of diversifying the tax base mix in favor of light industrial and non-retail commercial enterprises that complement each other as well as the existing commercial-industrial environment in Northfield. For example, in 2018, the City Council established a committee comprised of members from the EDA, Housing and Redevelopment Authority (HRA), Planning Commission and City Council. The committee’s charge was to provide a recommendation to City Council regarding a process to facilitate growth in the Northwest Area. After careful consideration of multiple approaches to planning for development in the area, including a master plan, the committee recommended an incremental approach to development in the area.
The memorandum accompanying the resolution identified several conclusions and recommendations, as well as future steps. Of note, and relevant to this memorandum are the following conclusions and recommendations from the 2019 resolution, specifically:
Conclusions:
• The 500 acres in the northwest area cannot be viewed in isolation from the overall economic development strategies employed by the city; 500 acres represents about 10% of the entire area of the City and must be integrated physically and economically into the community.
• Downtown is one of Northfield's most important assets; development should support and not draw business from downtown.
• Five hundred acres is more land than is needed for new growth within the foreseeable future. Since the 2011 Business Park Master Plan included the entire area, any proposed plan would need updated information, e.g. market feasibility; market absorption rates; fiscal analysis & return on investment for the City's estimated capital and maintenance costs for infrastructure including the expected timeline for breakeven on that investment.
• Staff and both appointed and elected decision makers should strive for vertical certainty and general agreement about development policy and process to reduce development uncertainty and risk.
Recommendations:
• Planning documents should be reviewed, analyzed, and updated:
• Consider further analysis of citywide land use and infrastructure to inform the planning process including official mapping of proposed road and infrastructure corridors.
• Create and adopt a Future Land Use map.
• Updating plans and policy should also reflect other City priorities such as climate action, equity, and transportation choice.
• Sustainability: The fiscal security of Northfield's future with respect to development opportunities and sustainability practices should be at the forefront of planning discussions. Northfield must evaluate the return on public investment for all projects including maintaining and replacing infrastructure improvements.
Since the 2008 Comprehensive Plan and land development/zoning regulations were updated, and the committee presented the above-referenced memorandum and path forward for the Northwest Area, including stating a request for a staff team to convene a conversation with St. Olaf College and Northfield Hospital staff regarding the potential to rezone the approximately 50-acres next to the hospital site, the City of Northfield adopted a Climate Action Plan (CAP) in 2019 (Attachment 4) which directs the City to, “integrate the Climate Action Plan into policy and plan updates including, but not limited to, the comprehensive plan, Land Development Code, complete streets policies, and others,” (PP7.1, p. 38).
Northfield has not yet adopted sufficient code language potentially applicable to this area that addresses elements of the CAP nor responds to conclusions and recommendations in the 2019 memorandum. Diversifying a municipalities’ tax base is one way to reduce the impact on one type of property owner, and in a community like Northfield with more than 30% of its market value consisting of tax-exempt property, the burden falls disproportionally on an individual homeowner.
Simply rezoning the areas to an appropriate commercial/industrial category is not sufficient to ensure future development meets goals related to carbon neutrality, nor the State of Minnesota’s similar goals. Nor is it sufficient to ensure that higher value natural resources such as fens, wetlands, old-growth forests, and other environmental resources are not compromised by development. Existing industrial-use areas do not have particularly strong guidelines that are specific to industrial site development, design elements, or consideration of sustainability concerns.
In the attached draft language, staff proposes a limited update to the existing I1-B: Industrial zone that considers the goals of the Climate Action Plan, changes in building materials and technology, energy efficiency and environmental and economic sustainability to provide guardrails that meet those stated and adopted planning goals and provide clear guidelines and standards for potential industrial users interested in building in Northfield, as well as changes in state law regarding recreational cannabis licensing, production, and use.
A more complete update would take place during the 2025-2026 Land Development Code process that would also take into consideration what land development/zoning regulations would be best drafted and implemented to facilitate development within Northfield that aligns with the Future Land Use map that will be adopted with the 2045 Comprehensive Plan. Related changes to the A-S Agriculture Special Use District, CD-S College District Special Use District, and the removal of the ED-F district are also proposed.
The guidelines and standards are designed to increase tax capacity, preserve natural features, ensure sustainable outcomes related to power and water consumption, stormwater management, limit greenhouse gas emissions and ensure any public streets are designed for connectivity. They are also designed to ensure high-quality building design, sufficient and appropriate screening, and minimize negative external impacts on neighboring property by establishing performance standards regarding light and sound “pollution,” vibrations, energy use, water use, and other potential negative externalities.
Proposed code amendments are included in Attachments 5 and 6 for consideration. Attachment 5 shows both the struck language and the added language. Attachment 6 shows only the new language. In both documents changes are shown in red text.
Proposed amendments include new definitions and design guidelines for uses related to cannabis, data processing, and renewable energy, along with performance standards for data processing and related facilities.
Alternative Options:
• Apply the existing I1-B: Industrial designation in the land development code.
• Apply the existing ED-F Economic Development Floating zone designation in the land development code.
Financial Impacts:
At this time this is a staff-driven effort and therefore no additional funds are anticipated to be spent on evaluating or writing code language. However, there are long-term financial impacts associated with industrial uses, both positive and negative.
Tentative Timelines:
August 15, 2024: Initial discussion of industrial use district with Planning Commission
October 2024: Draft language to Planning Commission and Council
October 2024: Public hearing on zoning map amendment for Northwest Area properties
November 2024: Planning commission public hearing and potential recommendation on text and/or map amendments
December 2024: Council decision on text and/or map amendments
Q1 2025: New industrial use regulations in place.
Q2 2025: Land Development Code update process begins