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CR2002-185 Zoning Amendment - Currency Exchange G \ T Y Or: . ~ November 27,2002 Council Report 02-185 HOPKINS . ZONING AMENDMENT - CURRENCY EXCHANGE Proposed Action. Staff recommends the following motion: Move to deny allowing currency exchange (check cashing) as a primary use in the B-3, General Business, zoning district with the findings as recommended bv the Planning Commission. At the Zoning and Planning Commission meeting Mr. Bartz moved and Mr. Rudolph seconded a motion to recommend denial of allowing a currency exchange as a primary use in the B-3, General Business. The motion was approved unanimously. Overview. The applicant is requesting an amendment to allow a currency exchange business within the B-3 zoning district. The Zoning Ordinance does not list this type of use in the ordinance as a pnmary use. The B-3 zoning district is scattered throughout the City. Most of the major thoroughfares are zoned with the B-3 designation. The location at which the applicant is proposing to open a currency exchange business is the Hopkins House Hotel. This area is zoned B-3, General Business. By permitting a currency exchange business as a pelmitted use within the B-3 zoning district, currency exchange . businesses could open in all B-3 locations within the City. Primary Issues to Consider. . What is the definition of a currency exchange? . Should this type of use be allowed in the B-3 district? . Are currency exchanges allowed as accessory uses? . What were the reasons the applicant stated for requesting a zomng amendment? . What is the staff recommendation? . What was the discussion at the Zoning and Planning meeting? Supportio2 Documents. . Analysis of Issues . Applicant's business plan !,' (\ ~ ~ . \ lo:Uvi \ (!rll{~',wt"\. Nancy sl' Anderson, AICP Planner . Financial Impact: $ Budgeted: YIN Source: - Related Documents (CIP, ERP, etc.): Notes: CR02-185 Page 2 . Primary Issues to Consider. . What is the definition of a currency exchange? The following is the City of Minneapolis definition of a currency exchange: An establishment, except a bank, trust company, savings bank, savings and loan association, credit union or industrial loan and thrift company, engaged in the business of cashing checks, drafts, money orders or traveler's checks or exchanging currency for a fee, as defined in Minnesota Statutes, Section 53A.01. . Should this type of use be allowed in the B-3 district? The framework for the existing zoning ordinance was adopted in 1977. There have been numerous amendments to the ordinance since 1977. None ofthe current staffwas employed by the City at this time to shed some light on the rationale of the list of uses in the business districts. We can assume the businesses detailed in the ordinance were the common types of businesses that existed for the times. Over the years there have been numerous amendments to the list of uses within the business district. An example of this would be a video rental business. In the 70's video rental businesses did not exist. . The City Council has discretion to allow this type of use in the City. Staff would recommend not allowing this use as a permitted use within the B-3 zoning district. There are ample existing businesses in Hopkins that allow residents to cash a check. If it is determined that it would be a use to consider, staff would denial of the applicant's request and direct staff to further study this issue and make recommendations to the Council. Attached are the conditions Mimleapolis places on currency exchange operations. . Are currency exchanges allowed as accessory uses? An accessory use is defined as the following: a use subordinate to the principal use on a lot and exclusively used for purposes incidental to those of the principal or conditional use. The business district allows accessory uses with the following condition: other uses customarily associated with but subordinate to a permitted use, as allowed by the City. A currency exchange is not a use that is associated with a hotel. . What were the reasons the applicant stated for requesting a zoning amendment? The applicant stated that there is a need for this type of service in Hopkins. . What is the staff recommendation? . Staffwould recommend denial of the zoning amendment to allow currency exchanges in the B-3 zoning district. If the Commission also moves in this direction the following are findings of fact to consider: CR02-185 Page 3 . 1. That a currency exchange use is not compatible with residential uses adjacent to B-3 districts. 2. Currency exchange uses may discourage other the development or redevelopment of other currently permitted uses in the B-3 district. 3. That the PlalUling Commission has determined that there are sufficient number of businesses that exist in Hopkins to provide the residents similar services, such as banks or credit unions. . What was the discussion at the Zoning and Planning meeting? Ms. Anderson reviewed the applicant's request with the COImnission. Terry Buchanan, the applicant, appeared before the Commission. Mr. Buchanan stated that he has looked at the demographics, and the target for his business is non-owner occupied housing. The Commission discussed the pros and cons of this type of business and noted that there is an existing currency exchange in Knollwood and another in Minnetonka near Shady Oak Road and Excelsior Boulevard. The Commission did discuss the proposed location at the Hopkins House and did not feel that after all the work done on that comer that this would be an appropriate use. No one appeared at the public hearing regarding this item. The Commission denied the zoning amendment with the following findings: 1. That a currency exchange use is not compatible with residential uses adjacent to B-3 . districts 2. That the Plmming Commission has determined that there are sufficient number of businesses that exist in Hopkins to provide the residents similar services, such as banks or credit unions. Altern atives_ 1. Approve the zoning amendment to allow a currency exchange use in the B-3 zoning district. By approving the zoning amendment to allow currency exchange in the B-3 district, the applicant will be able to operate a currency exchange in the B-3 zoning district. If the City Council considers this alternative, findings wi 11 have to be identified that support this alternative. 2. Deny the zoning amendment to allow a currency exchange use in the B-3 zoning district. By denying the zoning amendment, the applicant will not be able to operate a currency exchange as a primary use in the B-3 zoning district. 3. Continue for further information. If the City Council Commission indicates that further infonnation is needed, the item should be continued. . . The Business Plan # 1. THE BUSINESS A. Description of the Business: This will be a service business we will be setting people up v.ith a Bill Pay account, We will be offering Western Union Services, Money Orders, and check cashing services. R The Target Market: We have gathered several facts that have proved to us that Hopkins residents will use and need 1he above services. We have concluded that these types of services are needed in an area with a large percentage of non-owner occupied housing 57.31 % of Hopkins residents do not own their home (see at:ta.ched). We have also) found that people in areas -with a high Culture Index need and use these types of services. C. Competition and Fe#Sibility study: The nearest (:ompetition is in Saint Louis Park Another is off of Excelsior in Minnetonka. We have concluded that based on the attached demographics that there are larger demands for our services in Hopkins then in the bordering cities. This tells us that people are leaving Hopkins to conduct their business elsewhere. Our services would be pulling a percentage . of people back into a Hopk.-ins business area versus conducting their business elsewhere. D. Location of Business: Hopkins House Building otfHwy. 7 in Hopkins. E. Management: This will be a partnership business between my parents and myself The par1ners at no charge will be managing the business. F. Personnel: 1 employee plus a manager will be able to cover the business for our normal business hours of9:00 AM ~ 10:00 AM to 8:00 - 9:00 PM. G. Summary: Based on demographics and the lack of these services in Hopkins we have concluded there is a need for our service in Hopkins. # 2. FINANCIAL DATA A. Source of Funding: The partners will be providing the fmancing together. We concluded that we would need about lOOK to get the business started and to get it to a profitable point. . ; ! , . The reason for this letter is to show that the following services are needed in Hopkins. especially in an area zoned 83. We will be setting people up with a Bi~l Paying service, giving them access to Western Union services, Money Orders, and Check Cashing services. Our plan is to service people., and that means we will be adding and subtracting related services based on customer demand. According to Yahoo real estate the culture index in Hopkins is higher then the national average (see attached). People new to the area might not have taken the time or maybe for some reason they can't set up a checking account these people have paychecks they need to cash. They also, need help paying bills. sending money, and mailing out money orders. Currently the majority of people are going to other cities to get these type of servIces_ A trend that several businesses are going to is not to except checks we plan on being at a convenient location for people we also plan on being open latter then normal banking hours. The Hopkins House Hotel is one of those businesses who have stopped accepting checks recently. I've been told the Holiday Inn is considering the same lXJlicy- A large percentage of people living in Hopkins don't own their homes. The percentage of people in Hopkins that own their homes is 42.69% (see attached). We have found that our type of services, are needed in areas where a large number of people don't ovm their homes_ Based on this the majority ofHopktns residents could be in need of our services. . Hopkins has one of the highest concentrations of non-QV\lUer occupied housing in the entire T\oVin Cities. Qne could conclude that people are going to Saint Louis Park and MiIllletonka to get these type of services and once they have their pay checks cashed they most likely are buying goods and services in these cites versus buying goods and services in Hopkins. Our potential location is a short distance from Caribou Coffee, the new Cross Roaru. Center. the new Walgreens. And Lund foOOs. We have a consultant who \\ill be helping us start and market are business he has a suc<:essful similar business in Coon Rapids in one month his location cashed 600K in checks. One could conclude that our location would be putting thousands of dollars, in cash, every week into businesses located in a growing Hopkins business district. Due to the reasons listed above and the attached demographics, I'm asking you to allow a check cashing business to operate in Hopkins in an area zoned B3. . -- -- . -- --.- - .