Park I-35 Industrial Park/Beverage Manufacturing Facility FAQ
- What is Park I-35?
The I-35 / Co Rd 2 interchange area was identified by Scott County area leaders as one of the top corridors for economic development potential in Scott County in approximately 2012. During this time frame, Ryan Companies, an experienced national builder, developer, designer and real estate company secured an option to purchase approximately 120 acres now known as Park I-35, located in the southeast quadrant of the interchange.
Over the past decade, the City of Elko New Market, Scott County, the Scott County Community Development Agency, and Ryan Companies have collaborated in completing several projects that advance the property towards industrial development. These projects include environmental studies, traffic studies, an interchange design study, utility extension design, and extension of municipal utilities to the site. In 2021 and 2022 the property owner petitioned annexation of the property into the City limits of Elko New Market and Ryan Companies has now submitted an application to develop the property.
For more information about the Park I-35 industrial park: https://www.youtube.com/watch?v=sDPmTe2j5P8&t=8s
- What is the Niagara Bottling facility?
Niagara Bottling is an American beverage manufacturer that has been family-owned and operated since 1963. Niagara is proposing to construct a 425,000 square foot facility in Elko New Market’s I-35 Industrial Park. The facility will be the first in the City’s new industrial park, Park I-35, and serve as a catalyst for long-term economic growth within the community.
- Where is Park I-35 and the Niagara facility?
The proposed Park I-35 industrial park and Niagara facility, which is to be located in Park I-35, is located in the southeast quadrant of the Interstate I-35 and County Road 2 interchange.
- When did the City first become aware of the Niagara facility?
The City was informed that Elko New Market was Niagara’s preferred location for a facility in June of 2022. In November of 2021, Greater MSP, a regional economic development agency, distributed a lead to Metro area cities regarding a manufacturing company seeking 30 acres of land to locate a new facility on. The City of Elko New Market submitted Park I-35 as a potential site in response to the lead. Niagara evaluated several sites in multiple states before selecting Elko New Market.
- Why didn’t I hear anything about the Niagara facility until now?
As is common in economic development situations, the site selection process was conducted confidentially due to competitive reasons for both the company and the other communities that were contending for the business. Once Purple Rain Properties, LLC, an affiliate of Niagara Bottling, submitted formal land use applications to the City on September 30, 2022, the information was no longer considered confidential. City policy is that project information is not widely communicated to the public until formal applications are submitted.
- What economic benefits will would Elko New Market receive from Park I-35 and the Niagara facility?
If approved, Niagara Bottling will inject $125 million in direct capital investment into the proposed Elko New Market bottling facility. The facility would also create more than 50 full-time jobs for the local community with average annual salaries between $50,000 - $60,000 per year before overtime pay, benefits, and bonuses.
Property tax revenue projections are based on the estimated market value of the improved property, which has not yet been determined. It is expected, however, that the proposed Niagara facility will create significant property tax revenue for the City of Elko New Market, Scott County, the State of Minnesota, the Lakeville School District, and other taxing districts. It is expected that the proposed Niagara facility will create property tax revenue for the City of Elko New Market in excess of $175,000 annually – the equivalent of property taxes paid by approximately 120 homes based on average property value. This will also help diversify the predominantly residential tax base in the City, reducing the burden on residential properties. A portion of the additional tax base capacity may be captured in the near term to fund infrastructure supporting the development of the industrial park, including potential improvements to the interchange. However, this facility would serve as a catalyst for future industrial development in Park I-35 that will create additional tax base for the community.
Additionally, the proposed Niagara facility would be subject to one-time development fees and monthly utility fees. The one-time development fees help to pay for capital infrastructure that is part of the City’s water, sewer, and storm water systems. In addition to the development fees, Niagara would pay monthly utility bills to the City based on their water usage and sewer discharge. The utility revenue from the beverage manufacturing facility will benefit the City’s water, sewer, and storm water utility funds. The substantial water and sewer utility revenues are expected to provide the City with greater capacity to control utility rates and provide resiliency against negative financial circumstances.
- Will the Niagara facility impact my water and sewer utility bill?
It has been the City’s intention since this facility was first introduced that the facility would not be welcomed if it was expected to adversely affect utility bills for current users.
Elko New Market has capacity in the existing water system to serve the full development of the Niagara facility. However, serving the facility would use up a significant portion of the City’s capacity to serve additional growth. The Niagara facility therefore accelerates the timing of water projects benefitting new and existing users that normally would not be needed for several years - but also generates significant revenue to help pay for those water projects.
The City has reviewed the financial impact of the Niagara facility. The financial analysis was conducted both internally and by an external finance consultant. The analysis reviewed the cost of the accelerated water system improvements and the projected revenues generated by the Niagara facility.
In summary, the Niagara facility is expected to generate sufficient revenues to carry its own weight, help fund improvements that replace lost reserve capacity, increase the revenue base to buffer existing customers against costs related to future potential economic impacts that could affect financial health of the utility funds, as well as providing capacity to better control future utility rates.
- Where will the Niagara facility get its water?
The plant will obtain its water from the City’s existing water system via a transmission pipe already in place. The pipeline was constructed before this facility was known to the City in keeping with the City’s longstanding policy goal of promoting development in the Industrial Park.
There are no plans to install water wells at the Industrial Park.
- Can the City’s water supply system support the amount of water projected to be used Niagara?
The City consulted with a hydro-geology firm specializing in well and aquifer evaluations to review the City’s ability to provide the needed water without undue depletion of the aquifer. The findings were favorable, as the Prairie du Chien-Jordan aquifer is the most prolific in the Twin Cities region, and one of the most prolific in the State of Minnesota.
The City of Elko New Market currently gets its water from three existing wells that tap the Prairie du Chien-Jordan aquifer. These wells have sufficient capacity to serve the development of the Niagara facility alongside maximum demand from Elko New Market residents and other users. However, there will be operational adjustments and various investments needed over the next several years to replace reserve capacity and position the City for future population growth. The Niagara facility will accelerate the timing of water projects benefitting new and existing users. It will also generate revenue to help pay for them.
Existing demand for water varies annually, seasonally, and daily. System planners reviewed average demand and maximum demand while considering the impact of a Niagara facility.
The City of Elko New Market’s current population is just under 5,000 persons. The Comprehensive Plan for the City – long familiar to State and regional governmental agencies charged with ensuring the plan is viable – calls for Elko New Market to someday be a City of 70,000 to 80,000 people. The annual projected water usage for a City of that size would be several times the volume of water needed to serve the current City plus Niagara demand; however, no concerns about water availability have ever been raised by reviewing agencies, including the MnDNR.
The City will need to amend its annual withdrawal permit from the DNR to authorize the increased pumping. There were no apparent concerns during preliminary inquiries with MnDNR as to the likelihood and timing of approval for the needed volumes.
- Will the Niagara facility affect my well?
No. Well interference can be caused by local drawdown in a deeper well near a shallower well or by aquifer depletion.
Well drawdown is typically localized. The water surface of the aquifer is drawn down in a cone-shaped depression around a pumping well. Think about the depression caused at the surface of a milkshake when drinking through a straw just poking into the beverage. A water well works the same way. Because the water must flow through cracks and pores in the rock and soil to get to the well it doesn’t maintain a level surface when being pumped. Aquifers are more like sponges than tanks, and the material and depth of the aquifer makes the conic depression response vary between and even within aquifers. When the pump is off, the cone shaped depression disappears.
Interference is like when the ends of two straws are too close together in the milkshake – one or both starts getting air.
City well locations are selected to avoid interference with other wells in the same or connected aquifers. Aquifers can overlap if one is deep and one is shallow, and drawdown in one may not affect levels in another. The City’s hydrogeologic consultants consider proximity to other wells when analyzing proposed well locations, as well as the different aquifers involved and their interconnectivity.
A well pumping the amount of water this facility needs would be expected to draw down water levels in the City’s main aquifer only a fraction of available submergence depth at locations ¼ mile from the well, even if pumped continuously. Water in in this area of the subject aquifer moves relatively freely.
While potential drawdown effects on existing wells are a factor in siting new wells, the City also withdraws from multiple wells, further reducing drawdown effects by distributing the withdrawals. As a result, levels at any well aren’t drawn down as far and are allowed to recover between cycles. Sharing a milkshake works best when you take turns.
No adverse drawdown impacts on existing wells are anticipated.
- Can the City’s sewer system support the wastewater projected to be created by Niagara?
Yes. The industrial park is served by a new sewer system designed for the 120-acre development and selected portions of adjacent parcels. This new system can accommodate a range of potential flows, including wastewater discharges at volumes and rates proposed by the Niagara facility. This system discharges directly to a Metropolitan Council Environmental Services interceptor sewer sized for a population of 70,000 to 80,000 thousand persons.
- How will development in Park I-35, including the Niagara facility impact traffic at the interchange?
The City of Elko New Market has continued to monitor the traffic volumes and operations at the I-35 / CSAH 2 interchange and surrounding area since approximately 2015 and have been working closely with Scott County and MnDOT regarding this matter. Operations at the interchange are acceptable today but several movements are experiencing delays during peak traffic hours.
The Niagara facility will add minimal traffic to the interchange during peak hours due to their shift changes occurring outside of normal peak traffic hours. Truck traffic from the Niagara site is generally minimal and evenly distributed throughout the day. Traffic impacts from the remainder of the Park I-35 development are currently unknown because it is not known what other businesses will locate in the industrial park.
Traffic operations at the interchange are anticipated to degrade to unacceptable levels on several movements by the year 2026 with normal background traffic growth and no development in the immediate area. Niagara facility traffic is anticipated to result in a minimal increase in delays experienced at the interchange and not shown to dramatically increase delays in comparison to the normal background traffic.
The City of Elko New Market continues to work closely with Scott County and MnDOT regarding implementation of items that may improve operations, should they be determined necessary.
- What is the process for approving the land use applications associated with Park I-35 and the Niagara Bottling facility?
Ryan Companies, developer of the proposed Park I-35 Industrial Park, has applied for preliminary and final plat approval of the development. The proposed plat contains one lot to be developed at this time by Niagara Bottling and four outlots, two outlots that are areas reserved for future development and two outlots containing stormwater ponds. The application process requires a public hearing before the City’s Planning Commission, after which the Planning Commission will make a recommendation to the City Council regarding the plat. The City Council will then consider the application and will make final decisions regarding the plat application. If the proposed plat is approved by the City Council, the developer would construct a road and public utilities into the proposed industrial park. Construction is planned for the spring of 2023. City staff is currently reviewing the applications and meetings dates have not yet been determined.
Purple Rain Properties, LLC, an affiliate of Niagara Bottling, is proposing to purchase one lot in the Park I-35 Industrial Park, containing approximately 28 acres, from Ryan Companies. Purple Rain has applied to rezone the 28-acre property to I-1, Industrial. The land is guided by the City’s Comprehensive Plan to Industrial land use, and therefore the proposed zoning is consistent with the City’s land use plan for the area. Warehouse, distribution, and manufacturing uses are permitted within the I-1 zoning district. Purple Rain is proposing to construct a 425,000 square foot building on the property. The site and building design, as currently proposed, meet City zoning requirements with the exception of proposed silo heights. Silos, which will store raw materials, are proposed at approximately 65’ in height which exceeds the maximum allowable height of 50’ in the I-1 zoning district. Purple Rain has applied for a conditional use permit to allow the increased height for the silos. The application process requires a public hearing before the City’s Planning Commission, after which the Planning Commission will make a recommendation to the City Council regarding the application. The City Council will then consider the application and will make final decision regarding the conditional use permit. City staff is currently reviewing the applications and meetings dates have not yet been determined.
The Planning Commission will hold a public hearing on Tuesday, November 29th, 2022 at 7:00 p.m., or shortly thereafter at the Elko New Market Area Hall, 601 Main Street, Elko New Market, MN 55054 to consider the land use applications. lnterested parties are invited to attend the Public Hearing to express their comments, concerns and questions. If you would like further information regarding the above-described hearing, please call the City of Elko New Market at (952) 461-2777 in advance of the meeting.
- Will the Niagara facility be receiving any public subsidies?
Niagara has applied for two State funding programs, the Minnesota Investment Fund and the Minnesota Job Creation Fund. The Minnesota Investment Fund, or MIF, awards funds to local units of government who provide loans to assist expanding businesses. All projects for this program must meet minimum criteria for private investment, number of jobs created or retained, and wages paid. At least 50% of total project costs must be privately financed through owner equity and other lending sources (most applications selected for funding have at least 70% private financing). Projects that receive $500,000 or more in MIF assistance are subject to prevailing wage requirements.
The Minnesota Job Creation Fund, or JCF, is a program available to businesses engaged in manufacturing, warehousing, distribution, technology-related industries, and other eligible activities. Companies must work with the local government where a project is located to apply to the Minnesota Department of Employment and Economic Development, DEED, to receive designation as a Job Creation Fund business. Companies that meet eligibility requirements must sign a business subsidy agreement with DEED to meet job retention, creation, wage, and capital investment requirements. Projects that receive $200,000 or more in JCF assistance are subject to prevailing wage requirements.
Niagara has also applied to the City of Elko New Market for a business subsidy, in the form of a reduction in water and sewer connection fees. The request is to reduce the fees to what would normally be expected to be collected on average from the same acreage in the industrial park. The City may use business subsidies to assist development projects which meet the goals of the City.
The City Council will hold a public hearing on Thursday, December 15th, 2022, at 7:00 p.m., or shortly thereafter at the Elko New Market Area Hall, 601 Main Street, Elko New Market, Minnesota, 55054 to consider the business subsidy applications. All interested parties are invited to attend the public hearing at which time you will be given the opportunity to express comments on the Project and the Public Assistance. Written testimony will also be accepted at the public hearing. Written comments must be received by 9:30 AM on December 12th, 2022, at P.O. Box 99 Elko New Market, MN 55020. If you would like further information regarding the above-described hearing, please call the City of Elko New Market at (952) 461-2777 in advance of the meeting.
- When would construction start?
Weather permitting, and subject to obtaining all necessary approvals, construction is scheduled to start in April of 2023.
- How do I get more information?
More information about the proposed Elko New Market Niagara facility can be obtained on the City of Elko New Market website at https://www.ci.enm.mn.us, or by contacting the City of Elko at (952) 461-2777 or email: info@ci.enm.mn.us. Also, follow the City of Elko New Market on Facebook.
More information about Niagara Bottling can be found on their website at www.niagarawater.com
