Council puts Downtown development on hold

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June 25, 2002 // UPDATED 1:25 pm - April 30, 2007
By: Kevin Featherly
Kevin Featherly

In a little-noticed decision June 21, the Minneapolis City Council unanimously voted to stop all development in the Downtown East and North Loop areas -- fully one-third of Downtown.

Now, prompted by angry developers and contractors, some officials are having second thoughts.

Councilmember Natalie Johnson Lee (5th Ward) put the moratorium on the council agenda in what fellow Councilmember Gary Schiff (9th Ward) called "a last-minute walk-on item." It passed 13-0 and took effect immediately.

Reaction was swift. Schiff and Johnson Lee said they were besieged by calls and faxes from perplexed business owners wondering what the council doing.

"I started hearing from people whose projects had been through the system, and they thought they were going to get approved," Schiff said. "And suddenly the moratorium slams down and puts them at risk of not only having their projects stopped, but possible bankruptcy."

Schiff did not identify specific projects hurt by the moratorium.

Pat Smith, a Coldwell Banker Burnett real estate agent, said the moratorium hurts developers, contractors, laborers and everyone connected to those businesses.

"I don't see why the city would put a moratorium on development, especially at a time when Minneapolis can use those jobs," Smith said.

Smith said the move also hurts citizens who made reservations for condos that now won't be built for at least a year.

Schiff said, "I thought there was a greater [moratorium] need than what I've since discovered," he said. "I regret having voted for it."

The idea, according to Johnson Lee, was to give city staff time to complete master plans for Downtown East and the North Loop (see cover and page 4).

Johnson Lee said Councilmember Lisa Goodman (7th Ward) convinced her the day before the council meeting to add the item to the agenda. Goodman could not be reached for comment.

According to Johnson Lee, Goodman -- who is expected take over Johnson Lee's Downtown East and North Loop precincts in redistricting -- pressed the matter, saying it was urgent.

In retrospect, Johnson Lee said, the provision could have waited for more careful consideration.

"It was presented to me is it needed to be on a fast track," Johnson Lee said. "A senior councilperson said that this is the way it needed to happen. Also it was a staff recommendation. So we moved forward."

The moratorium survived a June 25 Zoning Committee meeting, though members discussed waivers for businesses.

Councilmember Dean Zimmerman (6th Ward) has no regrets about the moratorium vote.

"We're interested in making sure that we don't do any developments that are going to have to be redone because they don't fit very well with the light-rail configuration," he said.

Schiff said he hopes committee members will vote to rescind the moratorium at a special zoning committee meeting on Thursday June 11, and send that recommendation to the full council.

As written now, the year-long moratorium can be extended for up to 30 months.