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HomeMy WebLinkAbout2025.09.08 CCM STUDY9/8/25 -1- DRAFT MINUTES OF THE PROCEEDINGS OF THE CITY COUNCIL OF THE CITY OF BROOKLYN CENTER IN THE COUNTY OF HENNEPIN AND THE STATE OF MINNESOTA STUDY SESSION SEPTEMBER 8, 2025 CITY HALL – COUNCIL CHAMBERS CALL TO ORDER The Brooklyn Center City Council met in Study Session called to order by Mayor Pro Tem Teneshia Kragness at 6:04 p.m. ROLL CALL Mayor Pro Tem Teneshia Kragness, Councilmembers Dan Jerzak and Laurie Ann Moore. Also present were City Manager Reggie Edwards, Community Development Director Jesse Anderson, City Clerk Shannon Pettit, and City Attorney Siobhan Tolar. Mayor April Graves and Councilmember Kris Lawrence-Anderson were absent and excused. CITY COUNCIL MISCELLANEOUS DISCUSSION ITEMS Mayor Pro Tem Kragness asked if anyone on the Council had any miscellaneous items to discuss. Councilmember Jerzak said he read in the Friday update that the Council would be soliciting proposals for qualified audit firms because of a disengagement letter. Councilmember Jerzak asked Dr. Edwards if there was a specific reason for terminating the relationship. Dr. Edwards responded that there was no direct reason for the termination and that the City was fairly costly to them. The City had some things that needed the firm to do, and they contracted with them to provide the work, but they felt it was not as cost-efficient as some other contracts. Councilmember Jerzak asked if it would be another process where the Council and the Financial Committee members would be part of the selection process, and how that would be determined. Dr. Edwards explained that RFP solicits proposals and will bring forth the recommended proposals to the Council. Councilmember Moore asked Dr. Edwards when the RFP would open for that and if it would pertain to next year. Dr. Edwards said it would be for next year, and the City would start the process now. Councilmember Moore asked if the RFP would be open for 30 days. Dr. Edwards said it can vary in how long it is open. Councilmember Moore asked Dr. Edwards if he was confident that the City could find a qualified provider before the first of the year. Dr. Edwards answered that he was confident. Councilmember Moore said the new provider's contract would 8/25/25 -2- DRAFT be the same or a lower amount than the City's current contract. Dr. Edwards confirmed that she was correct in that statement. Councilmember Moore asked Dr. Edwards for an update on the City Commissioner’s review and timeline for the Code of Respect, as it was delayed at the last Council meeting. Dr. Edwards said at the last Council meeting, it was decided to postpone that item until the September 22 meeting, so it will come back at that time, along with the rules of Decorum. At this point, there have only been two comments from Commissioners on the Code of Respect. Councilmember Moore asked Dr. Edwards if he anticipated the Code of Respect being delayed any further, since there have only been two comments from all the Commissioners to whom it was sent. Dr. Edwards said the Code of Respect has been sent to all Commissioners, as well as additional time, and reminders when the deadline is to submit any feedback. He advised that at the September 22 meeting, the Council move forward with the Code of Respect. Councilmember Jerzak had a correction to the minutes from August 25. On page five of 60, the fourth paragraph, there is a statement about Councilmember Jerzak apologizing to City Clerk Shannon Pettit, and he said what he believes he did in that meeting was apologize for not getting something to Ms. Pettit prior to the meeting. He noted that he does not know if that needs additional clarification, but wanted to clarify. CITY MANAGER MISCELLANEOUS DISCUSSION ITEMS PET SHOP ORDINANCE CLARIFICATION Dr. Edwards noted that this item had been discussed before, and prior to City Staff spending an extensive amount of time on this item, there were some clarifications and questions that needed to be asked and answered prior to delving deeper into it, before coming back to the Council for approval. He introduced Community Development Director Jesse Anderson as well as City Attorney Siobhan Tolar to discuss this item. Community Development Director Jesse Anderson said that his Department dug into the Pet Shop Ordinance and started looking at other cities and what was adopted for ordinances regarding pet shops, and found that some of those ordinances contradicted themselves. Mr. Anderson noted that after a conversation with the City Attorney, the Department felt like there needed to be more clarification from the Council on this ordinance. Mr. Anderson said the main clarification his Department needs is whether the Council would like to prohibit the sale of pets from the pet stores, or if the Council would allow the sale of pets as long as those pets came with a source certificate. Councilmember Jerzak said there are various non-profits and rescues that use pet stores as an outlet. He noted that from a personal standpoint, he is very pro-rescue and rehoming of animals, and is very against commercial breeders providing animals to a pet store. He explained that the City does not have anything that allows accommodations for fosters of rehomed pets. Councilmember Jerzak said that all of his pets have been rescued animals, after receiving a pet 8/25/25 -3- DRAFT from a commercial breeder that he lost due to the parvovirus and inadequate care on the breeder's part. He stated that there is a huge need for temporary fostering while animals wait to find their forever home. He asked Mr. Anderson about the ordinance on page nine of 12, section 119, where a correction was needed on the three-dog portion. Councilmember Jerzak asked that the ordinance state requirements that foster homes have fenced-in yards, so there is less of a chance that foster homes could be reported as a nuisance. He noted the incredible need for animals to find homes, and the volume of animals being euthanized because the lack of care is very high. Councilmember Moore stated that the Council would like to prohibit the sale of dogs and cats in pet stores. She noted that the Council is not going to regulate the sale of animals, but completely prohibit it in the City of Brooklyn Center. She said that the City would not regulate commercial breeders either, as that is not in the Council's purview. Councilmember Moore said she noticed the look of concern on Councilmember Jerzak’s face. Councilmember Jerzak said that she contradicted herself if there are no sales of pets in a pet store. Councilmember Moore said that it is different, and she is talking about commercial breeders. Councilmember Jerzak asked her to clarify her statement. Councilmember Moore said that the Council would regulate commercial breeders by not allowing the sale of dogs, cats, or other animals in pet stores. She noted that the City has never had pet stores due to requirements in zoning ordinances, including areas like Gatlin, where stores with anything related to pets are not allowed. Councilmember Moore said the desired result is that the Council would prohibit the sale of dogs, cats, and other animals in pet stores. She thanked Mr. Anderson for bringing different codes to light, including one regarding a commercial kennel license, and asked if this ordinance would also prohibit establishments like commercial kennels from the sale of animals. Mr. Anderson stated that pet stores are not permitted in some zoning districts, but there is a commercial kennel license in the City's code. Councilmember Moore said that Councilmember Jerzak brought up a great point on page seven of 12, there is a limit to how many animals someone can have in their home, and this was brought up 10 years ago under Mayor Wilson and was not addressed for animal fosters. Councilmember Moore said that she is a proud foster, and may have been in violation of this code if the limit for fosters exceeded the limit. Mr. Anderson responded that there are no specific regulations on fosters, but residents can only have two dogs according to the ordinance. Councilmember Moore asked if the current limit is two dogs, three cats, or a combination of five animals total. Mr. Anderson said the limit of animals is correct. Councilmember Moore said there should be additional language that would pertain to fosters to allow them to foster more animals. She asked if her comments answered Mr. Anderson’s questions about what the ordinance should pertain to. Mr. Anderson asked for clarity on whether the Council wanted to prohibit the sale of animals at pet stores, but would allow adoption events. Councilmember Moore nodded yes and said that he 8/25/25 -4- DRAFT was correct. He continued that the City would not change regulations on commercial breeders because the state regulates that. He noted that changes could be made to the number of animals allowed at a residence, and it is a relatively easy change to make. Changes to the ordinance regarding fosters would require more time and research in order for him to address that with the Council. City Attorney Siobhan Tolar thanked Mr. Anderson for his comments and said some of the questions that Mr. Anderson was asking were about what the Council would like to do in the City of Brooklyn Center. Ms. Tolar noted that fostering animals is already allowed and not regulated, so people are able to foster animals with no problem as long as they do not keep the animals above and beyond what is already outlined in the ordinance. She noted that the C ouncil does not need to regulate fostering, as it is already allowed. Mr. Tolar said that in terms of regulating animals inside of pet shops, there are no pet shops in Brooklyn Center, and they are allowed. She said the Council should consider that if someone was trying to start a pet shop business, and would not be able to sell any animals, then the Council should prohibit pet shops in the City, rather than having a pet shop and allowing owners to use a storefront for adoption events. Ms. Tolar said foster pets usually come from non-profit organizations with no headquarters that host events at different businesses around the City. Ms. Tolar explained that when the Council discusses regulating things in the City, the Council needs to discuss what exactly they want to prevent and what is allowed to happen within the City. She noted that this might be a separate issue apart from a pet store ordinance if the Council wants to regulate backyard breeders, or how many animals someone can have in their possession as a resident of Brooklyn Center. She said that she and the Community Development Director need to understand what the Council wants in order to draft the City ordinance. Mayor Pro Tem Kragness said she agrees with Ms. Tolar, and hearing that a pet store cannot sell pets is like buying from Amazon, and should not require City Staff to go through the process of doing research to create an ordinance with so many restrictions. Councilmember Moore said that, respectfully, she does not buy from Amazon, and there is no reason that the Council should disallow a pet store. She stated that there are plenty of pet stores that do not sell animals. She referenced a place in New Hope called the Total Dog Company, where she picks up supplies and gets her dog's nails trimmed, and they do not sell pets there. She said it was unfortunate that she had to go to another community to get her dog's supplies and other services, due to the restrictions in Brooklyn Center. Councilmember Moore said she remembered a small business owner who wanted to open up a shop, but unfortunately, the rent was too high, and the business owner could not open it in a location uptown due to zoning restrictions. She said she was not sure if there were any restrictions up at Humboldt Square for pet stores, but she knew that uptown there were. Councilmember Moore reiterated that she does not want to disallow pet stores from coming into the community, as there is a need to provide for the owners and pets in Brooklyn Center, and this has been voiced by residents over time as well. She asked if her statements clarified things for Mr. Anderson and Ms. Tolar. 8/25/25 -5- DRAFT Mayor Pro Tem Kragness said she would like to clarify that her point remains the same, and instead of calling it a pet store, maybe it would be more accurate to call it a pet supply store, so there are no limitations around it. She said that if someone is referring to a pet store, it would presumably sell pets. Councilmember Moore said that Mr. Anderson could look at the nomenclature of dog supply versus store and bring back some clear vernacular to the Council going forward. Mayor Pro Tem Kragness said that it is her understanding that if someone were to open a pet supply store, the Council would not be having this conversation, and asked Mr. Anderson if that was correct. Mr. Anderson said he would have to look at the zoning code, but a pet supply store would probably just be a retail store, not a commercial animal establishment. Dr. Edwards said that the City Staff could look into that now, and everyone was on the same page as to what the ordinance would establish. Mr. Anderson asked if everyone was on the same page, with three animals allowed instead of two in a residence. Councilmember Jerzak said that on page nine of 12, the ordinance talks about a limit of keeping three or more dogs, but further down, it states the custody of two or more dogs, and the ordinance should be consistent with three. He said he recalled that, specifically, the number of pets a resident could have came up when it was related to a dangerous dog event, which is a separate issue. He noted that he remembered being brought into the event as a Code Enforcement Officer, and he had to refer to the CSOs at the time. There are very specific differences between neglect and hoarding animals. He said the Council did not need to get into that conversation tonight or cloud the issue, but he stumbled upon 76 parrots in a residence once, as well as countless snakes and reptiles. He stated he understands what Councilmember Moore was saying, and he would also like the nomenclature cleared up for the ordinance. He also appreciated Ms. Tolar bringing up the other thoughts about the ordinance. He noted that he most importantly wants to encourage the responsible fostering of animals. Dr. Edwards asked for clarity on whether the Council intended to regulate pet breeding in the ordinance. Mayor Pro Tem Kragness said that the state is already regulating commercial breeding, so the Council was not going to enter into that conversation. Councilmember Moore asked to clarify what Councilmember Jerzak was asking about on page seven of 12. The ordinance states that three or more dogs, or four or more cats, and further down in the ordinance, it states custody of two dogs. She asked if he was referring to the ordinance being consistent with having custody of three dogs. Councilmember Jerzak confirmed that was what he was referencing, and that we should all say three dogs. She noted that in 1-109, there is a statement about having custody of more than two dogs, and later on, she also says that a resident can have three dogs. She asked Mr. Anderson if the ordinance could be cleaned up for clarity. OPPORTUNITY ZONE LEGISLATIVE PILOT INITIATIVES 8/25/25 -6- DRAFT Dr. Edwards stated that this particular item would be coming forth in October or November regarding the City’s legislative agenda, and wanted to share with the Council and get feedback on an effort as it relates to economic growth and strategies for the City. He introduced Economic Development Manager Ian Alexander to present on this item. Economic Development Manager Ian Alexander said he wanted to take a moment to go over some things that have come up over the last few months to change the economic condition of Brooklyn Center. He noted that before he begins his presentation, this is not about political ideology or philosophy, and City Staff is focused on leveraging opportunities, zone incentives, and targeting tax credits to create a competitive economic advantage in the City. Mr. Alexander explained that the City has Opportunity Sites which predate Opportunity Zones. He explained the background for the Opportunity Zone Legislative Pilot Initiative, which, in the last several years, has seen interest rates sharply increase, making access to capital more difficult for developers and slowing development. Brooklyn Center’s market is complicated due to its proximity to Minneapolis and Maple Grove, both of which draw spending dollars away from Brooklyn Center’s businesses. One advantage Brooklyn Center can leverage is to draw transformative development into its Opportunity Zone. Opportunity Zones are designated low- income census tracts that investors can invest capital through Qualified Opportunity funds. Investor dollars are pooled to finance development in the Opportunity Zone targeted by the fund. Investors can receive a range of tax benefits on their investment. There are technically two census tracts in the Opportunity Zones, although they are one combined census tract, and that includes the entire Opportunity Sites. One of the Opportunity Zones will be referred to as the Heritage Site, and the other will be referred to as everything else north of the highway. He explained that there are a lot of opportunities to spur economic development in those locations. Mr. Alexander showed the Council a slide with a sample investment and how Opportunity Zone investment would work with legislation and the new 2025 bill, and asked if the Council would like him to explain, or if the Council wanted to just read it on their own and move on. Mayor Pro Tem Kragness said the Council could read it, and Mr. Alexander could move forward. Mr. Alexander continued that if a person sells an asset with a profit or capital gain of $600,000, instead of paying tax on that $600,000 right away, it can be reinvested into a Qualified Opportunity Fund (QOF) investing in an Opportunity Zone. The benefit is that the investor did not have to pay taxes on the $600,000 gain and delays paying taxes for five years, giving the investor time to grow. After five years, the investor pays taxes on $540,000, not the full $600,000, due to a 10 percent reduction in the amount that is taxed, saving taxes on the other $60,000. If an investment grows during the 10-year exclusion period, no tax is owed on the additional gain. For example, if the initial investment of $600,000 grows to $700,000 after 10 years, the $100,000 in gain is tax-free. If the investor holds the initial $600,000 investment for 30 years and the investment grows to a value of $1.2 million during that 30 years, the investor's "cost basis" resets to $1.2 million. This means the investor won't owe additional taxes on the growth. 8/25/25 -7- DRAFT Mr. Alexander said that something to keep in mind is that the state of Minnesota has both a state capital gains and a federal capital gains tax, and his Department is trying to push some pilot projects within the state that would give the City parity with the federal law within certain census tracts. The hope is that those census tracts will be in Brooklyn Center, and Mr. Alexander's Department will also be working with Brooklyn Park. Doing this would give more people more incentives to invest in Brooklyn Center. The legislative goals are to use targeted incentives and credits to encourage private investment in Brooklyn Center's Opportunity Zones. Incentives are administered at the state level, not the municipal level, and Brooklyn Center's budget is not affected, nor is tax revenue reduced. Mr. Alexander continued that proposed legislation focuses on re-developing specific low performing, low revenue producing property types which includes government owned land, and privately-owned land that meets at least one of the following criteria: vacant or undeveloped land, classified as substandard under Minnesota statutes, section 469.174, subd.10, and commercial property with 50 percent or less occupancy for at least three years. Mr. Alexander said the reason that his Department is doing this is to prove that they are not trying to take money off the state tax roll. Mr. Alexander noted that through research and interviews, he discovered what has worked in different locations and jurisdictions and what has not. He and City Staff decided on a few different Opportunity Zone Legislative Pilot Project criteria, and one of the more creative titles they came up with was the Investment and Market Participation in Aligned Credit Tracts – Minnesota (IMPACT-MN) Pilot Act, which is modeled after and mirrors a federal program (26 U.S.C. 1400Z- 2) offering tax incentives to investors in Opportunity Zones. If investors keep their money invested for five years, they receive a 10 percent reduction in the taxes owed. After holding the investment for 10 years, any new profits earned are tax-free at the state level, which encourages investments in the City. This pilot project helps Minnesota Opportunity Zones compete with other states that do not have state income or business taxes, leveling the playing field for investment. Mr. Alexander noted that when he first learned about the Opportunity Zones, he was surprised to learn that many people wanted to do projects in Minnesota, yet many were not done in Minnesota because the state cannot compete with other states like Texas and Florida, where there is no state income tax. Mr. Alexander continued that the second part of the legislative Pilot Initiative, the Leading Investment for Future Transformation – Minnesota (LIFT-MN) Pilot Act, offers a 39 percent non- refundable state-level New Markets Tax Credit (NMTC) over seven years, providing up to $20 million in credits in Brooklyn Center's Opportunity Zone. The Federal New Markets Tax Credit (NMTC) program provides federal tax credits to investors who are contributing capital to Community Development Entities (CDEs), which have been spread out over seven years. CDEs invest in commercial projects and businesses in low-income communities, stimulating economic development in distressed areas. Mr. Alexander explained TIF quickly to recap before going into another initiative. TIF captures local new property tax revenue ("increment") to pay for project costs. That revenue is available to 8/25/25 -8- DRAFT the City's EDA, not the General Fund, and the City does not see the benefit until the TIF district ends, which is between 15 and 26 years. He detailed the other initiative is the SPUR-MN Pilot Act, which adds funding for infrastructure using state funds, not local dollars. Infrastructure value is abated, leaving new buildings taxable. The City, local schools, and county see tax revenue immediately, which helps the Community Development fund some projects around the City. Used together, SPUR provides funding for infrastructure like roads, sewers, and plazas. TIF provides funding for housing or site cleanup. The City sees an increase in its tax base, helping Brooklyn Center grow without giving up revenue. Mr. Alexander discussed the Generating Renewable and Efficient Energy Networks – Minnesota (GREEN-MN) Pilot Act, which offers a refundable 25 percent tax credit (up to $5,000,000 per project) for energy-efficient and sustainable design features –such as LEED certification and solar panels. This does not need to be LEED certified, but LEED certification could be part of it, and solar paneling would be funded by the state, not the City. This project would work with other programs, including the Opportunity Zone, benefits, historic tax credits, and housing tax credits, to attract investment. It can encourage solar energy retrofits and cleaner, more efficient buildings, cutting pollution and energy use, aligning with Brooklyn Center's sustainability goals and youth - focused future. Mr. Alexander discussed meeting with Senator Susan Pha and Representative Samantha Vang via video conference to discuss these proposals and ask their opinions, without asking them to push a bill. Mr. Alexander and City Staff wanted their opinion on the benefits of dedicating these incentives to designated Opportunity Zones in Brooklyn Center and Brooklyn Park, and possibly select locations in greater Minnesota. Senator Pha and Representative Vang opined that smaller pilot programs are generally easier to advance than statewide initiatives. Both lawmakers emphasized that these proposals would need to pass through the tax committee before becoming law. Both lawmakers are open to formally reviewing these proposals with legislative staff after they receive confirmation that the Council supports these initiatives. EDA Staff also met with Lobbyist Ann Lenczewski, who agreed that these initiatives align well with federal and state tax incentive strategies, and that the very limited scope of a pilot project would likely be more appealing to lawmakers compared with statewide legislation. Mr. Alexander continued that EDA Staff met with Brooklyn Park’s Community Development Director and Brooklyn Park’s Economic Development and Housing Director to discuss possible collaboration. Brooklyn Park’s staff supported this legislative agenda. Brooklyn Center and Brooklyn Park already partner for BrookLynk, the City's youth training program, and for Minneapolis Northwest tourism to promote regional growth, along with several other projects. If these initiatives move forward, Brooklyn Center and Brooklyn Park could coordinate efforts to use tax incentives jointly, attracting economic growth that would benefit both cities and strengthen their shared economic future. Mr. Alexander said the most important part of this is that the Minnesota state Governor has to re-appoint the Opportunity Zones within the City. Mr. Alexander discussed with Nathan Ratner, from the Deed's Government Relations Office, and Mr. Ratner agreed that expanding Opportunity Zones aligns well with federal and state tax incentive strategies. EDA Staff believe Brooklyn Center is eligible for six census tracts to be designated Opportunity 8/25/25 -9- DRAFT Zones, up from the current two. He explained that Shingle Creek Crossing is not in an Opportunity Zone, but the daylight portion is eligible for funding. Brooklyn Park is eligible for three designated tracks, which is an increase from the current one. Increasing opportunity zones increases eligible benefits for redevelopment and aligns census tracts designated for federal New Market Tax Credits, enhancing benefits that come at no cost for Brooklyn Center, and is accomplished administratively by the Minnesota Deed. Mr. Alexander summarized that these legislative pilot initiatives provide unique competitive benefits to draw investment to Brooklyn Center. Pilot initiatives may be easier legislative victories, and tax credits and abatements are tools that do not affect Brooklyn Center revenue and minimize impact to the state’s revenue capacity. Targeting underperforming sites within Opportunity Zones increases the tax base and avoids taking performing properties offline during development. Mr. Alexander asked if there were any questions, and if there was a general consensus among the Council for City Staff to continue to work on these initiatives and include these initiatives in the legislative priorities for approval later this year. Mayor Pro Tem Kragness said in her opinion that the pilot would be more successful if other cities from greater Minnesota were brought into it as well, to buy into the idea. She supports any initiatives that are going to create economic development opportunities in Brooklyn Center. Councilmember Jerzak said there were previously Opportunity Zones in the City, there was a stumbling block, and he did not recall any of the Opportunity Zones ever being utilized. He asked if Mr. Alexander could define the difference between now and then. He also said it seems that what attracts the most funding opportunities through grants is affordable housing. Mr. Alexander stated that Opportunity Zones in Minnesota historically do not work exceptionally well, and they do not work well because there is a tax break, but there are still state taxes. The idea of the pilot is basically an experiment to see what money can come into the City. Mr. Alexander explained that parts of uptown Minneapolis were in an Opportunity Zone, which does not seem possible. He noted that the Opportunity Zones in uptown Minneapolis were really great for putting a financial pro forma together to help the developer make extra money. The investors in those projects made a little bit more money by using incentives, but those buildings were going to be built anyway. Mr. Alexander stated that what he and EDA Staff are trying to do is take the state tax off the table and do that only within a number of census tracts to see how that would bring in funding. Councilmember Jerzak said he is not opposed to this on the surface, but creating another bureaucracy is not of value. He noted that if Brooklyn Park and Brooklyn Center get these pilots, the state taxes would be taken off, which may not be equitable across the state. The EDA has two champions, Senator Pha and Representative Vang, but he sees some challenges and pushback coming from that. He advised coming up with projects in mind, and reasons why the City needs those projects to succeed, with a history of why it has not worked here, as the best way to support both lawmakers. He is in favor of these initiatives, but knows the resistance when other communities want the same piece of the pie, and there has to be a fairly compelling reason for 8/25/25 -10- DRAFT Brooklyn Center to get it over others. He said there is a lot of politics involved in this, and asked how much time and energy the City Staff is willing to spend in a year on these initiatives. He noted that City Staff should still try to get these initiatives moving, but be realistic and make plans, but do not plan on results. Mayor Pro Tem Kragness said that City Staff should ensure that they have the best chance of being successful. Councilmember Jerzak added that he likes the idea of working with Brooklyn Park, but selfishly would rather have these initiatives come to Brooklyn Center. Mr. Alexander said that when the EDA first put the pilot together, they specifically looked at where there are overlapping New Market Tax Credits and Opportunity Zones, and it may come as a shock, but every member of the Tax Committee had one of those in their district. Senator Pha originally said to concentrate on greater Minnesota. Mr. Alexander spoke with representatives from Marshall, Bemidji, and a few other locations, and they all had areas like this and said it was a great idea, and asked why their cities were not doing this either. Mr. Alexander explained that these initiatives cannot happen all over the state, so he looked at 20 census tracts, which is one and a half percent of all the census tracts in the state, and is a small area. He stated that in reality, there is only one City, Brooklyn Center, in the state that has this much land that has not been developed. He noted that he listened very carefully when Councilmember Moore discussed the idea of finding a master developer to come in, and that is also one of the reasons to really push these initiatives, because the more incentives the City provides, the better. He said that he received a report from Finance and Commerce about all of the multi-family housing permits pulled in the month of July in the entire metropolitan area, which included six permits. He said Brooklyn Center has to find a niche to be economically competitive with everyone else, and these initiatives are one strategy to get there. Councilmember Moore stated she was going to concur with Councilmember Jerzak on a few things. She noted that the legislature is the most divided it has ever been, and is looking at a six billion dollar deficit for the years 2028 and 2029. Deed has done some work with St. Cloud, Mankato, and Duluth, and seems to throw money at little projects around the state, and does not understand what the rhyme or reason is to it, but there must be some process that these cities have gone through. She stated that the sign of the times is that the chances of having Senator Pha and Representative Vang look at anything are going to be nil to none, in this upcoming session and moving forward. She stated that she worked at the state for eight years, and anytime she saw a pilot program, it made her nervous because it typically meant that the state would start it, and then would not have funding for it later, and eventually there would not be any money for that program. She said there are probably examples of pilot programs that have been started and never finished in the City, region, and state where that has happened. She said that her only hesitation is that a pilot program typically means that at some point, the responsibility is going to turn back to the City to bear some part of the cost, or the City has to fund it entirely to sustain it after the pilot is started. 8/25/25 -11 - DRAFT Councilmember Moore said that in the last five or six years, the City has received a lot of grant funding, but now the money is no longer there, and the residents can not afford to fund some of those programs. Mr. Alexander said that the one thing that happened with Opportunity Zones passing in the last tax bill of 2025 is that they are now part of federal tax policy. Federal tax policy pilots can always come back and hurt the City if they involve City funding. These initiatives are completely state and or pass-through money, so if the state decided to get rid of the pilot, it would not hurt the City. He stated that this is not one of those situations where the City would have to put money back into these initiatives. He noted that if the City could bring itself into parity with a state that does not have a capital gains tax, that alone could help get more investments in the City. Councilmember Moore thanked Mr. Alexander for clarifying that this pilot program would not be a liability that could fall back on the City. Dr. Edwards stated that it sounded like there was a consensus among the Council to continue to move forward with these initiatives, and the Council would receive updates on it moving forward. ADJOURNMENT Councilmember Moore moved and Councilmember Jerzak seconded to adjourn the Study Session at 7:03 p.m. Motion passed unanimously.