DIDA Learns New Business to Locate Downtown

IRONWOOD, MI - by Steve Frank - Thursday, August 26, 2010 - The Downtown Ironwood Development Authority (DIDA) learned this morning that a new business will be opening soon on Ironwood's main street. Pictured above are the new owners of the former Johnson Music Store building, Terry & Georgine Decker and Mike Novak. The trio recently purchased the Aurora Street building that most recently housed the short-lived Pipe & Bike Shop and was previously the long-time location of Videoland. They have begun remodeling the space and they will be opening shortly. The building will feature an auction center; a retail store-front and an online sales center. The store will sell overstock merchandise at bargain prices. The company, D & N  Liquidators, plans on hiring eight to ten employees.

1. Call to Order - The acting Chairman, Joe Karius, called the meeting to order at 8:00 AM. The Authority members introduced themselves to the DIDA's newest member, Tom Williams.

2. Recording of the Roll - DIDA Secretary Jane Bowman recorded the roll. Members in attendance included: Vice-Chairman (acting Chairman) Joe Karius; Eva Smith-Furgason; Matt Weber; Gail Johnston; Tom Williams; Mayor Bob Burchell (ex-officio); Jim Albert; and Lee-Ann Garske. Rick Tippett was excused. City Manager Scott Erickson was also present. In the audience were Geneva Smiles, representing the SISU Skifest Committee, Kate Genellie, reporter for the Daily Globe and me.

3. Oath of Office: Tom Williams - Prior to calling the meeting to order, DIDA Secretary Jane Bowman administered the oath of office to Tom Williams.

4. Consider approval of the July 29, 2010 Regular Meeting Minutes - Mayor Bob Burchell pointed out that a minor error was present in the minutes. Erick Fitting was mistakenly identified in the minutes as being Erick Anderson. Jane Bowman noted the change and the Authority unanimously voted to approve the minutes as amended.

5. Approval of the Docket - Mayor Bob Burchell asked that an audience with Mike Novak, and Terry & Georgine Decker be added to the agenda. Novak and the Deckers wanted to introduce themselves to the DIDA too let them know of their plans to open a new downtown business. The Docket was amended to include the item (7a), and the Authority unanimously approved the amended agenda. 

6. Citizens wishing to address the Authority on Agenda Items (3 Minute Limit) - No citizens asked to speak.

7. Audience: Geneva Smiles, Representative of the SISU Committee - Geneva Smiles addressed the Authority regarding the SISU Skifest.  She told the DIDA that the Committee has been meeting regularly since early May. She said there are new Committee members and the group has a new Business Liaison. She explained that the Committee was working on "filling in the gaps" based on lessons learned from the first event. Smiles told the Authority that the group now has a new Expo Coordinator who will assist in the exposition activities in the Memorial Building.

Smiles said the SISU group recently held a barbecue kick-off. She explained she was unable to attend, but she said it was her understanding that the event was quite productive. She turned the floor over to Mayor Burchell who attended the event for an update.

Mayor Burchell told the Authority that approximately 45 people attended the kick-off. Burchell said that a flowchart of the various activities was created and many of the people in attendance volunteered for many of the different duties required. The race route was discussed and it appears they may be some changes to better accommodate traffic and business concerns. At this point, it was agreed that the main street route would be shortened and street crossings would have scrap carpeting laid upon them to allow for through traffic -- if needed. The streets will not be snowed in until after most of the businesses are closed on Friday.  

Smiles said the changes should make for a better race, and she said she hoped more spectators will come out for this second annual event. She said that cheering spectators at the end of the race really add to the excitement of the event.

Lee-Ann Garske asked Smiles if there was any discussion about blocking side streets. Burchell said the barricades would be located at the alley openings on McLeod instead of the full street intersections. This would allow traffic through the alleys. The other side streets would remain open. Burchell told the Authority that both Suffolk and Norfolk Streets, which were both closed for last year's event, would remain open this year. Burchell said that people would be able to pull up to Lahti's showroom on the Lowell/Aurora intersection, but parking would be angled for the event.

Burchell said the finish would not be at the Library as it was last year. This will allow through-traffic to the businesses. He said the finish would be at the Olde Ale House and that would have the competitors ending up along the "core" block of the downtown. Burchell suggested that the Sharon's Place lot could be a valuable asset to the race and for other events in the City.

Eva Smith-Furgason asked if the "support people"  would be "spilling into" the Suffolk/Aurora intersection. Burchell said adjustments to the route will be needed to best address such issues, and to make for the best race possible.  Smiles indicated that the lobby of the River Valley Bank will be available as a warm up area for spectators and racers.

Karius asked if the Committee had a liaison that will stay in contact with downtown businesses to address their concerns. Smiles said that Eric Fitting has been talking to area businesses and he will continue to do so. She indicated that the Committee was also in contact with Mary Hitt from the Ironwood Merchants Association. She said she encouraged the Merchants to attend SISU Committee meetings so that they can hear their input.

Burchell and Smiles encouraged people to volunteer in any way possible since the race will ultimately benefit the entire community. Smiles said she would like to see more area businesses involved in the Expo this year. She said that Donna Coggins is the Expo coordinator.

a. Audience: Introduction to Mike Novak and Terry & Georgine Decker (D & N Liquidators) - Mike Novak addressed the Authority by first introducing his business partners Terry and Georgine Decker.

"We own the former Johnson's Music Store building and we've been working on getting it cleaned up and operational so that we can have an auction center and have auctions there, as well as have a retail storefront with which to sell merchandise out of the storefront." Novak said, "We'll be selling overstock merchandise to the public on an auction and online. We intent to employ eight to ten employees. We would like to have some funding help for the front of our building and the interior, if at all possible."

"In terms of our start-up costs, we're looking at a hundred thousand dollars to start-up. And, we've anticipated our monthly sales goals to be around $15-25,000/month in sales through the retail store and in online auctions. So those are kind of the bullets that we put together to kind of explain what we're all about."

"We fully intend to go green with wind power and solar power," Novak explained, "We're going to put -- if you're familiar with the structure of the building -- you'll notice that on the top of the roof, there's also a peak on the very top of Johnson's which we intend to fasten a  windmill. But it's not a typical windmill with blades. It's what we call a can windmill or a circular windmill. We're intending to paint it maybe the color of a Pepsi can or something to where, as it rotates..."

"Or a flag..." Decker interrupted.

"Or a flag! A flag would be better. Speaking as a veteran, I go for the flag. So that we can have that going and fully solar powered. My colleague, Terry Decker can talk a little bit more about this..."

Terry Decker told the Authority that the windmill resembles a Coke can. He said he has electricians that work with him that would retrofit the electrical service to accommodate wind and solar power. He said the windmill is completely silent and about 6 feet tall. He said the unit will generate about 4 kilowatts per hour. He said solar panels will be placed on the slants of the roof as well.

"We're going to try to make the building completely 'Green'!" Decker told the DIDA.

Decker told the Authority that he has a lot of experience and expertise with solar and wind power.

Decker said that the retail leg of their operation will have extended hours. He said earlier and later than standard hours are planned. Consignment auctions would also take place on a regular basis. This type of auction would give people an opportunity to sell items they want to get rid of in order to get some extra cash. He said there would also be retail sales and online auctions available.

Joe Karius asked what kind of merchandise would be sold. Decker said it would be a mix of overstock merchandise that the company would be buying by the truckload and consignment sales.

Karius asked Erickson if there were any State programs for "going green." Erickson said they were in the process of investigating that option. Other funding options were also mentioned: the IEDC Revolving Loan and the Facade Grant Program; for example. Jane Bowman gave the new business owners a list of available funding prepared by former Community Development Director Dan Petersen. Bowman indicated that a new round of the Facade Grant was being applied for.

Albert asked if there were any zoning issues with windmills or things like that. Erickson said that the City didn't have any current codes regarding green energy devices.

Collectively, the DIDA welcomed the new businesspeople to the Downtown and wished them much success.  

8. Discuss purchase of empty lot in “Core” block of downtown - The Authority briefly discussed the possible purchase of the former Sharon's Place lot. The DIDA paid $5,000 to raze the dilapidated building on the lot. The City of Ironwood paid $9,800. Gogebic County paid $3,600 for asbestos abatement. The property was up for tax sale. $6,100 was owed in back taxes. The City attempted to purchase the property at auction, but was out-bid. The current owner of the building purchased the property for just over $5,000 and is willing to sell the property back to the City or the DIDA for the money he has invested into the lot.

Jim Albert expressed concern that the DIDA (or the City) was eyeing the property for installation of Public Restrooms. He pointed out that the Blueprint Plan cautions against creating public restrooms, and HyettPalma, the consultants for the Plan, strongly advised not to provide them.

According to the Blueprint Plan:

"The public should be afforded the convenience of restroom use while in Downtown by making it widely known to area residents and tourists that restrooms are available at Downtown’s library, Depot Park, and Memorial Building. And, Downtown business owners should allow – and even encourage – pubic use of restrooms in their shops, since doing so has often been found to spur sales."

"If the decision is made to create public restrooms, this should be done with extreme caution, since such facilities have been found to create tremendous maintenance, security and cost issues."

On May 12, 2009, when Doyle Hyett officially presented the Blueprint Plan to the City, he addressed an audience at the Gogebic Community College. Here's what he had to say about providing stand-alone public restrooms downtown:

“A lot of you are calling for public restrooms. It does afford great convenience to the shopping public, but one of the things we need to get the word out about, at this point at least, is that you can go to the bathroom at the Library; you can go to the bathroom at Depot Park; you can go to the bathroom at the Memorial Building – obviously when those facilities are open. But, one of the things that we need to get in the heads of business people here in community is that there’s a direct relationship between the toilet and the cash register. Many of you are shocked!”

“It’s called the ‘McDonalds Theory.’ McDonalds has proven that if you get of that interstate highway or if you get of that highway period, and you go into a McDonalds, they are going to encourage you to use their bathrooms because they know you are going buy something. They are going to ‘guilt’ you into buying something. But it’s the truth.”

“We have a client out in Kansas, Peabody, Kansas, they opened up – many, many moons ago – a mercantile in the downtown. There were no public restrooms there including even City Hall. The City Hall wouldn’t let you use their bathrooms. So this guy Gary and Marilyn Jones had this great idea and they laid all their merchandise out in like a serpentine. You had to zigzag through all their merchandise to get to the bathroom. They put a sandwich board out on the sidewalk that said ‘Public Restrooms’ and people, when they’d come into their store, would wiggle all through all that merchandise back to the ‘Roost’ – the ‘Chicken Roost’ is what they called their bathrooms in that store. And then they’d wiggle back up, usually with something in their hand that they’d buy.”

“When you go in to talk to Gary or Marilyn about how business was, the week before let’s say... they’d say, “Boy, Saturday we had a ‘four-roller.’ The kept track of how well their business was doing by the number of toilet paper rolls that they used! And we hear this constantly from merchants about – you’ve got to keep them clean or people won’t use them – but, we heard, ‘Well, their going to break my bathroom.’ Have you priced a toilet at Wal-Mart lately? Any of you? Or at a hardware store? You can buy a toilet for seventy-five dollars. It can’t be a matter of money, it’s just they just don’t want you using their bathroom. It’s just that simple. But if merchants would understand that you don’t want public restrooms, you want them to use your restrooms because they’ll spend money with you!”

“Now, if you insist on having public restrooms beyond what you have today, please understand this... that those are very, very expensive propositions! We have clients in this very state – I won’t tell you who they are because I don’t want to embarrass them – but one public restroom cost them $30,000 a year to maintain. And they have a person full-time doing it, because people want to use it. And plus, you have to have security!”

“I won’t tell you who this community it, but it’s a Michigan community. They’ve had people raped in public restrooms. We’ve had children molested in public restrooms. They’re accidents or bad things waiting to happen, unless you’re on top of your game!”

“Those that I’ve mentioned to you – the Library, the Depot, the City Hall building and Memorial Building – those all have staff in there, so they’re a little bit safer, but if you put some free- standing public restroom out there, you’d better have a way to watch it. And you’d better have somebody literally during the waking hours or whenever it’s open, to keep it clean or people won’t use it!”

“But the best thing is for you business people to understand that let people use your restrooms! They’ll appreciate it. They’ll come back! They’ll tell their friends about it, and your population is aging – let’s face it – they need that access. If they’re going to stay down there more than a half an hour, they’re going to have to find some place to go. And it might as well be your business so there will be possibility they’ll be spending money with you.”

Albert said, however that he didn't object to the DIDA or the City purchasing the property as long as it was going to be used for another constructive purpose.

Scott Erickson denied that there were any plans for new restrooms in the area. He told the Authority that the Theatre expressed interest in the space to be used for performances; and as green space; and perhaps a public gathering area.

Albert reminded the Authority of the money the City, the DIDA and the County has spent on the property already, and he suggested that a lesson be learned. Previous DIDA member Wayne Ozark repeatedly urged the City to create Ordinances that would require buildings be brought up to code when placed on the market for sale. He suggested that minimum standards be established to prevent speculators from blindly purchasing property with the hope of flipping it for a quick and easy profit. Ozark's plan would allow the City to take possession of severely blighted buildings that were not brought up to code. In doing so, the City would, at least, own the property, so money spent by the City would be invested rather than wasted.

"What's done is done!" Karius said, "As far as the restrooms, I want to clarify, the Blueprint report generally does not favor restrooms on the grounds that it would be high maintenance. It does not completely say that we should not have them. And obviously the State feels that it's a good enhancement for the downtown."

Karius asked Erickson if it would be possible to leverage some of the grant money to purchase the lot. Erickson said that option hasn't been examined, but he assumed it would be possible.

Eva Smith-Furgason said it was her understanding that grant money could not be used to purchase property. She mentioned that Cathi Cole, the City's contact to the Michigan Economic Development Corporation, previously indicated that grant money could not be used to purchase the Soo Line Depot and adjacent property when the DIDA was looking to do so.

Erickson said that property acquisition is allowed, but he believed the issue with the Depot and the old railroad property is that the City was trying to use the City's match, rather than the grant funds, for the purchase and that was not allowable.

The general consensus of the Authority, after further discussion, was that purchasing the property was a good idea. Eva Smith-Furgason made a motion to pursue the property for use as greenspace. Her motion was seconded and a vote was taken. The DIDA unanimously approved the motion. At a later time, the DIDA and the City will discuss details of the purchase and the appropriate governing body will make a final decision on the terms of the sale. 

9. 2010 Michigan Downtown Conference -  Scott Erickson asked if any of the DIDA members were interested in attending this two day conference in Bay City, Michigan. He told the Authority that members need to let Ms. Bowman know if they wished to attend, and the City would find a way to assist them in attending.

10. Christmas Wreaths - The Authority unanimously agreed to allow Santa's Wreaths supply the Downtown with decorations for this year's holiday season.

11. Update on Grant Application -  Scott Erickson told the Authority that the pre-application was approved and the City is waiting for the final application for the Blueprint grant to be approved.

12. Update on Annual Blueprint Benchmarks - Scott Erickson suggested that the DIDA submit an updated list of benchmarks because the criteria that former Community Development Director Petersen is not readily available.

13. Update on Day Trip to view other community(s) streetscapes - Erickson is proposing a day trip to Minneapolis to see how other cities have updated their downtowns. Eva Smith-Furgason suggested that a trip closer to home and within the State of Michigan would be more appropriate. One way or the other, the trip is being planned, but no date has yet been established. Erickson suggested that interested members contact Ms. Bowman with possible date suggestions.

14. Citizens wishing to address the Authority on items not on the Agenda. (3 Minute Limit) - No members of the general public wished to address the Authority.

15. Other Business - Lee-Ann Garske suggested that larger, healthier flowers be considered for next summer. Bowman said that the baskets they are using are too small and quite old. Garske also suggested that flowers hanging from the Depot eves be added to program next year. Further action will be taken on this matter at a later date.

16. Adjournment - Following other business, the meeting was adjourned.