Shakopee Mdewakanton Help Met Council Create Jobs Through Transfer of SAC Units to City of Plymouth

Prior Lake, MN – To help foster economic growth in the Twin Cities, the Shakopee Mdewakanton Sioux Community has recently reached an agreement with several government entities that allows the transfer of some of its reserve wastewater treatment capacity to the City of Plymouth. The City will then use this capacity to facilitate the expansion of St. Jude Medical, Inc. in one campus in Plymouth which will consolidate operations and retain 800 jobs. The SMSC purchased these SAC units over the years but no longer has a need for them due to construction of its Water Reclamation Facility which opened in 2006.

“As a government we’re out there helping the metropolitan economy improve by helping create and retain jobs not just here at the SMSC but out in other areas, this time in Plymouth,” said SMSC Chairman Stanley R. Crooks.

The transfer which was finalized in July 2012 was the result of the intergovernmental cooperation of the SMSC, the Metropolitan Council, the City of Plymouth, Minneapolis St. Paul Regional Economic Development Partnership (GREATER MSP), and St. Jude Medical, Inc.

Agreements, like this, are infrequent. They can occur when a community with excess paid credits for SAC transfers those credits to another community to accommodate a business opportunity elsewhere that is creating jobs. The Commissioner of the Minnesota Department of Employment and Economic Development must make a determination that there is a significant state-wide economic impact, and the Metropolitan Council agrees that the regional system has the needed capacity to serve the new site.

“The Metropolitan Council is pleased to advance economic development opportunities in the region. The transfer of SAC credits is an example where we’re able to facilitate economic activity, through partnerships and cooperation with governments like the Shakopee Mdewakanton Sioux Community and the City of Plymouth,” said Jason Willett, Met Council Finance Director.

“GREATER MSP is happy to partner with local communities, governments, and businesses to spur economic growth in our region. St. Jude’s expansion in Plymouth will add hundreds of great jobs, which is beneficial for our entire region,” said Michael Langley, Chief Executive Officer of GREATER MSP. The Minneapolis St. Paul Regional Economic Development Partnership (GREATER MSP) is a private non-profit formed last year that coordinates economic development projects throughout the region.

“This is a way for different agencies to come together to promote business growth in Minnesota,” said Plymouth Mayor Kelli Slavik.

“In addition to this arrangement, last summer the SMSC sold 117 SAC units to the City of Bloomington, which enabled Polar Semiconductor to add about 300 skilled technical labor jobs to its facility in Bloomington,” said Chairman Crooks.

SACs and St. Jude Medical

A SAC is a one-time fee charged by the Metropolitan Council to entities when they connect to the regional sewer system. The fee is used to construct additional capacity to ensure the system can meet the demand. A SAC fee is determined by the number of units used by the facility. SAC revenue pays for regional system improvements to ensure the system can meet service demand in the future. A SAC is assigned when a building permit is issued connecting a new or existing building to the sanitary sewer system. Without assigned SAC units a business cannot be built or significantly grow. There are a few limited situations where a government that has excess net SAC credits can transfer those credits to a business that is creating jobs.

One SAC unit equals 274 gallons of maximum potential daily wastewater flow capacity. A freestanding, single-family residence is charged one SAC unit. Other types of buildings pay a prorated SAC fee based on the estimated potential capacity of wastewater they will need. To build each wing of Mystic Lake Casino Hotel, for example, required the purchase of SAC units from the Metropolitan Council.

“Because many of the future growth opportunities for St. Jude Medical are expected to arise from devices in the Cardiovascular Division, we’re excited to develop a Plymouth Campus that will not only help streamline operations and business activities, but also bring employees together under one roof,” said Frank J. Callaghan, president of the St. Jude Medical Cardiovascular Division. “This expansion is viewed as a consolidation and space solution for the company, but also acknowledges a need for adequate space to house our growing business in the years ahead.”

Phase 1 will transfer 37 SAC units with Phase 2, still to be determined, expected to be as high 70-80 SAC units.

Plymouth is the former headquarters of AGA Medical, a company St. Jude Medical acquired in 2010 to consolidate operations for St. Jude’s which currently also leases locations in Maple Grove and Minnetonka. St. Jude Medical develops industry-leading medical devices, medical technology, and services that focus on putting more control into the hands of those who treat cardiac, neurological, and chronic pain patients worldwide. St. Jude Medical is headquartered in St. Paul, Minnesota.