Brainerd council issues permit for new downtown apartments

BRAINERD — With a permit in hand, developers are ready to move forward on a 78-unit apartment complex in downtown Brainerd.

City Council members approved a conditional use permit Monday, April 22, for a mixed-use development at the site of the old Thrifty White building at 805 Laurel St., but the decision didn’t come without some controversy.

Dubbed Eight05 Laurel, the new four-story building will include 12 studio apartments; 28 one-bedroom units; nine one-bedroom apartments with a den; 15 two-bedroom, one-bathroom units; and 14 two-bedroom, two-bathroom apartments. Per Americans with Disabilities Act standards, there will be one handicapped accessible unit.

The main level will house five rental spaces, along with an office, community room with kitchenette, work spaces and unisex bathrooms.

There will be 65 underground heated parking stalls, 26 surface stalls, an elevator and secure entry to the building.

The conditional use permit presented to the council Monday will allow the building to exceed height restrictions in the Town Center zoning district and allow for residential use on the ground floor with the condition that an additional six shrubs be placed on the east side of the parking lot planting bed for additional screening.

The council also reviewed and approved a variance request from the shrub and tree requirements, as city code would require 312 shrubs based on the number of units. The applicant instead proposed 28 deciduous shrubs and 17 evergreen shrubs on the property.

Council member Jeff Czeczok asked about an outdoor area for pets — a point he said was brought up at the Planning Commission level — as dogs are going to be allowed in the building. As a small patch of grass would likely not hold up for multiple dogs relieving themselves, Czeczok asked about some sort of artificial turf available, worried that owners might be inclined to cross the street to the well-maintained greenspace near Brainerd BN Credit Union. He also asked developers if they considered not allowing dogs or putting a size restriction on dogs at the property.

Andrew Duchesneau, of DW Jones, said planners have identified a spot about the size of a parking lot stall on the northwest side of the property that could include artificial grass for pets.

He added there is a size restriction for pets, but he did not know that off the top of his head.

Czeczok moved to add the pet area in as a requirement of the conditional use permit, along with a 25-pound limit on dogs.

“Because if somebody comes in there and has a couple of great Danes or Rots or something that weigh 100 points, it makes, I think, the whole environment uncomfortable,” he said.

The motion failed for lack of a second.

“This is our last chance, and if we’re going to sit there and not be distracted by the shiny object here, folks, we should try and do something now before we can’t,” Czeczok said. “... It’s just frustrating to see a motion made and nobody wants to talk about it. … You don’t have to vote for something if you second it.”

Rules of decorum call for council discussion after a motion is seconded and before it is voted on.

Czeczok voted no on both the conditional use permit and the variance, though they both passed 6-1.

Kelly Humphrey / Brainerd Dispatch

Another action item before the council Monday night was for the city to act as legal sponsor for a $6.8 million Workforce Development Grant for the project. The state program is authorizing $39 million to construct workforce housing in rural communities, but it requires municipalities to apply for the grant rather than a developer.

Before voting on the measure, Czeczok asked several questions about the application narrative document submitted by DW Jones for the grant, pointing out typos and commenting on the validity of certain characteristics of Brainerd.

A description of the project area notes the retail district where the building is to be located is an area with hotels, dining, public parks and beaches, though Czeczok pointed out there are no hotels or beaches in downtown Brainerd.

“If I’m putting my best foot forward, I’m cleaning this up before it gets submitted, and I think that’s your job to give to our staff,” he told Duchesneau. “Because we’re asking our staff to do this work along with you, and I would feel like a complete idiot if this got passed and nobody changed that wording, and then somebody goes in and says, ‘What did you guys do here? How could you approve that? Didn’t you read this?’”

He asked Duchesneau if he read the documents and just happened to miss the errors. Duchesneau acknowledged the mistakes.

“They’ve been pointed out to us,” he said, “and we will make the necessary adjustments to it. We’ve got a couple other applications in, and unfortunately we missed a couple things, but we will go through it with your recommendations and make those changes.”

Czeczok said the project is a big deal, and he wants to make sure the city does a good job in the process.

“And when I see this, it’s frankly scary,” he said. “... As a City Council member, it’s my job to make sure these things are correct. And I didn’t see anybody else raising their hands here to ask about any of this.”

The measure passed 6-1, with Czeczok the sole opposing vote.

Community Development Director James Kramvik said there should be news on the status of the grant funds in July. If that funding comes through, he said there are tentative plans to begin demolition of the existing building in late summer or early fall of this year.

Kelly Humphrey / Brainerd Dispatch

The City Council agreed to a tax-increment financing district for the project last July. A tax-increment financing — or TIF — district is a financing tool communities use to capture tax-based growth resulting from a new development or redevelopment project. Under this model, the city receives the original taxes generated from the property but the difference, or increment, created from improvements to the site — such as a new building — is returned to the developer for a set period of time.

The face value of the TIF district for the project is $3,793,275, including both the housing and commercial space. The commercial space represents 7.91% of the total project square footage, meaning $3,493,227 of the TIF district is attributable to the apartments.

The project was also awarded $1.3 million from the Crow Wing County Housing Trust Fund at a 0.5% interest rate deferred for 20 years.

A Mainstreet Grant from the Brainerd Lakes Area Economic Development Corporation amounts to just under $200,000. And because the site is located in the city’s River to Rail corridor, the city waived the sewer availability charge and water availability charge fee of $257,400.

The proposed development, headed up by DW Jones, has been in the works for years, and plans for the building have changed in that time. An early proposal from 2021 included only 36 apartments, all with income restrictions that ranged from 30%-60% of the area median income. Area median income is the midpoint of a region’s income distribution.

Under the new plan, 16 of the units will be 80% area median income, meaning tenants would need to make 80% or less per year of the area median income. Thirty-one units will be restricted to 115% area median income, while the remaining 31 will be market rate. According to the U.S. Department of Housing and Urban Development, 80% median income for Crow Wing County in 2023 was $49,400 for one person and $70,550 for a family of four.

THERESA BOURKE may be reached at theresa.bourke@brainerddispatch.com or 218-855-5860. Follow her on Twitter at www.twitter.com/DispatchTheresa .