Streitz plans to build Goddard School in city

Photo: Bonnie Obremski/RepJNorthfield.org

Update log: 10/27 9:30 a.m., 10/31 2:30 p.m.

Jesse Streitz received informal encouragement from the Northfield Economic Development Authority (EDA) on Thursday morning to move forward with plans to build a Goddard School for Early Education off Professional Drive.

Streitz, former mayor of Dundas, said he would plan on returning to the EDA in the future to ask what the board can do to help finance the endeavor, possibly through a Master Development Fund loan.*

Buying the land and building the school would cost about $1.9 million, he said. The school would eventually employ 20 people and enroll about 134 students. He told the EDA he hoped to break ground between January and March and operate the school at “half-capacity” at first.

Streitz also owns Streitz Heating and Cooling Inc. in Dundas.The Pennsylvania-based Goddard Systems Inc. is a franchise company and Streitz said some people compare the institutions with Montessori-method schools. Part of the Goddard School philosophy is to offer “a wide range of enriching activities to meet the needs of each child,” and to build “each child’s emotional, social, cognitive and physical skills,” according to their Web site. Interested franchise owners need at least $150,000 cash to start, according to Goddard policy.

Streitz plans to build his 8,000-square-foot school for children aged six weeks to six years old, with after-school programming for children as old as 12. There are more than 280 Goddard schools in the nation with four in Minnesota. The nearest Goddard School is in Apple Valley. Each school can vary in its age range and tuition. But, for purposes of example, Apple Valley charges parents $970 a month to educate a pre-schooler.

During Thursday’s meeting, the members of the authority and city staff asked Streitz questions about the proposed project. The discussion led Streitz to explain why he chose to build the school in Northfield, which has three public elementary schools, one private school and one charter.

Streitz said the Goddard Systems corporation performed a demographic study and approved Northfield as an acceptable location, even though it was “on the line” because of a relatively low number of residents “of child-bearing age,” he said. The study indicated there are enough people in the community, however, who could afford to pay the private school’s relatively high tuition. Streitz said there has not been a Goddard school yet that has failed.

“This is a premium product,” Streitz said.

*Update 10/27 9:30 a.m.: City Councilor Scott Davis clarified Mr. Streitz intentions to revisit the EDA to talk about financing: “He (Streitz) also expressed an interest in using the EDA’s Master Development Fund loan program for $15,000,” Davis said, in a post listed below this story. “As part of our toolbox, the ability to make that loan forgivable, as we have for a number of other businesses, was brought up. The forgivable part comes with strings attached: The recipient must meet whatever criteria the EDA deems appropriate to justify the investment (certain employment levels is one example). Since this was an informational meeting, no specifics were discussed and no decisions on what Mr. Streitz will request or what the EDA will support.”

Update 10/31 2:30 p.m.: Earlier this week, I spoke with Mr. Streitz more about his project and with Jody Gunderson, Northfield economic development director, who told me more about the Master Development Fund loan.

Mr. Streitz said his college degree is in education and he spent a significant amount of his career as a teacher of industrial technology at the high school and college level. He said Goddard School franchises are set up in a way that restricts owners from owning more than one school. So, he said, that is at least one reason why he would hope the community would see the school as locally owned and operated, instead of as part of a large out-of-state corporation.

Gunderson gave examples of current Master Development Fund loans, which can be low-interest or “forgivable,” he said. Forgivable means if a businessowner meets certain criteria over a period of time, the businessowner no longer has to repay the money. The criteria are in place to ensure the business is contributing to the local economy in a positive and significant way, he said. The loans are small enough to constitute as “gap” financing, Gunderson said.

There are existing city-related costs of about $15,500 Streitz would have to pay if he bought the land in question for his school, Streitz said. That is why he would ask for that amount of money in the form of a forgivable loan, if his project moves forward.

According to Gunderson, city officials approved a forgivable Master Development Fund loan to the owner of the Perkins Transportation on Riverside Drive* in 2006. The owner spent about $700,000 to renovate the building. The loan was for $75,650. He said city officials approved the most recent Master Development Fund loan to the owner of the future Culver’s restaurant off Highway 3. The owner is renovating the former movie theater into the restaurant. That loan is for $75,000. Construction on the Culvers began in September.

*Update 11/3 8 a.m.: Thank you to Joel Walinski, interim city administrator, for the following correction. As a new person to the city, I heard the word “Perkins” when I was speaking with Mr. Gunderson and automatically assumed the only business with that name was the restaurant. I will try and be more careful in the future!

A correction to the added lines on Ms. Obremski’s article. The $75650 forgivable loan was to Perkins Transportation on Riverside Drive. The loan was forgivable based on the improvements to the existing warehouse and creation of jobs. I am very glad Perkins is in town, they are a world class business that works on transporting oversized equipment. Thanks for moving to Northfield!

33 thoughts on “Streitz plans to build Goddard School in city”

  1. The Goddard School for Early Childhood Development is a national chain offering childcare and education for children ages six weeks to six years old, in both half- and full-day schedules. At each location, the owner and a a director of education are on-site at all times.

    Kids are schooled in art history, music, manners, yoga, reading, American Sign Language, Spanish, and other subjects – all presented in a positive, fun manner.

    Most Goddard School locations offer private kindergarten classes, as well as after school and summer programs.

    Source: GoCity Kids

  2. Wow, did anyone look at the market? Several local daycares are having to work very hard just to stay in business as competition has drastically increased locally and the demographic is down. Who on earth thought that adding 134 “early education” spaces in this market was a good idea?

  3. Providing educational options for the community and the children is a win win for the community! One of the top three issues a family faces when they want to relocate is what do they have for my children.
    This is a win win. Congrats!

  4. How is it a win-win to put long standing local employers out of business? Why is this canned for-profit daycare a win-win when Northfield has plenty of GREAT educational opportunities for little ones already, many of them struggling to fill seats? This marketing of the Goddard school is meant to play into parental anxieities about kids knowing how to count, etc before kindergarten. Check out the reviews of the existing Goddard schools (including the apple valley one) and you may decide it’w more of a win-lose.

  5. If Goddard school doesn’t provide a needed service they will go out of business.
    There is certainly no law in place for them to try providing an option to the existing ones?

    Let them try…good luck.We need businesses here in town.

  6. The issue comes down to whether the City/EDA should provide financing to this project.

    If it is a business, and there are already substitutes for it in town, what is the case that it adds to the economic or community base in a manner such that it deserves a subsidy? That’s the simple question to answer.

    The environment just needs to be that of a level playing field and the City/EDA should not choose favorites in a competitive field.

    The issue could be considered differently for a business that does not have substitutes in town, or that would primarily compete with substitutes outside of the community or taxing district.

  7. I was just highlighting the part of the story that said

    “Streitz, former mayor of Dundas, said he would plan on returning to the EDA in the future to ask what the city can do to help finance the endeavor.”

    Hope it didn’t come across as my advocating for such financing.

  8. I agree w/Dave Koenig and Holly, EDA should not choose favorites in a competitive field. And the daycare field is already saturated, as Jim Rossow of Grandpa’s Farm on Hwy 3 can tell you. There is the public school program, St. Dominic’s, UCC, St. John’s, the Montessoris (sp), to name a few, and the many in-home ones.

    I remember when a daycare in the Ice Arena area had to close some years ago, right about the time a new one at NCRC was coming in. People were in tears, such a sad story.

  9. If the business can cut it on its own: great, and welcome to Northfield. But I don’t see how adding an apparently redundant service warrants a city subsidy.

  10. As a parent of a 2 and 3 year-old, and a member of the Board of Directors at a preschool here in Northfield, I would like to say that I agree completely with Nick Waterman on this topic. There are 2 small, non-profit, highly affordable and highly reputable preschools in town that have been in existence since the 1940’s and the 1960’s. Both are sweet little neighborhood schools run by parents. They encourage and require community and family involvement, which is exactly what the youth in this town need. Many families live close enough to walk their kids to preschool, which is good for the environment and our children. Both of these schools are struggling with enrollment and one recently cut back teacher’s hours due to low enrollment. A franchise like Goddard could potentially drive these schools out of business. We do not need another chain/big box corporation with a huge parking lot coming in to “educate” our preschoolers for hundreds of dollars a month. Preschoolers need love, encouragement, and support from their families, teachers, and community members. With this, they can learn anything.
    I see this as another Mendota Homes’ fiasco.

  11. So, everyone is basically saying that one of the major criteria of the EDA in a new project is to enusre that in developing the economy or new business, that we do not duplicate services we already have?

    This is silly. Economic Development is to encourage business growth, and it should be a level playing field.

    IF a new business wants to come to town, and it needs help, the EDA should assist, regardless of what it is. The EDA should have no bias, and be there for all comers, regardless of whether or not it is another pizza place, or a for profit school.

    It is important to remember that this is a for profit, tuition based school, and is a business. It will either succeed or fail. But, it brings jobs and helps the economic base. It should be given a fair shot.

    To handicap the EDA by saying it can only help certain new businesses, and only ones that will not directly compete with existing businesses will limit economic growth, and limit the effectiveness of the EDA.

    I see two choices for the EDA:
    1. Help everyone, without bias… or
    2. Close the EDA, and let everyone fend for themselves.

    To do option #2, would be a disservice to the community.

    Just my $0.02… and I think that Mr. Strietz is a pretty shrewd businessman. He wouldn’t be doing it unless he thought it would fly.

    Also, look deeper… This is NOT a daycare. 😎

  12. I’d have to agree with Nick. As a Board member for Open Door Nursery School (ODNS) we are extemely concerned that Northfield’s long standing (and by the way EXCELLENT) preschools are going to be wiped out by FOR-PROFIT SCHOOLS. Director of ODNS Barb Howe has done research on the current Market and there aren’t enough children to fill the current spots. If 134 more open something will have to give.

  13. I would have to agree with Nick. Why encourage a business that will drag all the other providers down. By over saturating the market, everyone is competing for the same kids–and potentially everyone will suffer. At the same time, I would like to think that the not-for-profits would have an edge because their rates would be lower. They also have excellent reputations–a new for profit school would have to compete. I don’t know that the EDA should consider financial encouragement without considering the impact on other businesses AND not-for-profits.

  14. John, I didn’t mean to imply that the EDA should not, in any case, subsidize a business that competes with existing businesses. Rather, it makes the case substantially more difficult to approve.

    The field should be level and the EDA should not play favorites. And, we have to acknowledge that if a new business will displace other businesses, it is less clear that the net impact will be positive.

    It is not absolutely clear that it will be neutral or negative, just less clear that it will be positive and the EDA should be able to justify un-leveling the playing field in such a case.

  15. Yes, it is a daycare. That it fills the kids days with “educational” material is pure marketing; go to a local “daycare” and you’ll see: counting, abcs, social skills, hand-eye coordination, and all this other stuff. If you’re taking good care of kids, all that stuff happens without your packaging it and selling it via anxiety. Ask any local kindergarten teacher whether there’s a material difference between “daycare” and “preschool” graduates and you’ll learn a lot: no. But there *is* a difference between kids who have either of those social learning environment experiences and kids who don’t.

    What on earth is the point of economic development? Doesn’t “development” imply some ADDED thing? How is it a meaningful addition if it just takes away other jobs? Yes, I’m sure Streitz is a smart guy who believes he can make money on this, and have at it, Mr. Streitz. But don’t ask for my tax dollars. Clearly, if you’ve got 150,000 to throw at this franchise, you don’t need my money. And i’ll give it any day to the struggling local daycare which has been EDUCATING kids for years on pennies and love. Not for profit.

  16. Agreed…

    What the interesting item is to ponder is… What does Mr. Strietz know that we do not?

    It appears that he had done the due diligence, and a market study was done. It came back being “on the line”, so I can see why he is looking to open at 50% capacity.

    What I am trying to rationalize in my head, is a $1.9 million dollar investment to open the doors, with about 65 students at 50% capacity.

    I have to think about the numbers a bit… but the ROI and ROE to profitability has to be out there a few years. The $1.9 million is just ground and facilities… There will be additional start up costs, that will take significant time to recoup.

    Also, what is the standard child to staff ratio at a similar facility? Can a staff of 10 handle 65 children? (50%)

    I will have to ponder this further, but, as a smart businessman, I am sure his plan is viable, or he wouldn’t be pursuing it.

    I am not judging at all. I just like doing the analysis. It is a fun diversion.

    I am all for new business. If they think it is viable, I say GO FOR IT!

  17. So, John, if Whole Foods wants to come in and build a new store, you’d be just dandy with the city handing them a check?

  18. From the City of Northfield website:

    The City of Northfield Economic Development Authority (EDA), created in 1991, seeks to improve the economic condition of Northfield. Focusing on appropriate commercial and industrial development, the EDA works to establish a higher tax base and additional job opportunities for the citizens of Northfield. The EDA provides resources and tools, including loans and grants, to support this kind of development.

    My question… who gets to define the word “appropriate” in that statement above?

  19. Anne,

    You pose a difficult question, as you know how I personally feel about Just Food, and how I will support it forever. Bringing in a Whole Foods would have a significant impact to Just Food.

    Your question is outside of the scope of my comments, as I am not in a position to judge the appropriateness of the applicant.

    My comment is that the EDA should treat all applicants without bias, and my question is, who gets to determine if the applicant is appropriate. My guess is that these seven folks basically control the whole deal.

    I feel that the way the question is posed… that if I answer, then someone will replace the words “Whole Foods” with “Wal-mart” and we will have a completely new argument.

    I guess my response is that I would like to see the EDA continue to foster business growth in our community. My personal bias is toward small businesses and local business owners that want to grow… but again, that puts a bias against the goal of fair and equal.

    I can agree that there are certain businesses that I would NOT like to see come to Northfield, however, some would argue that these businesses are wanted and needed here.

    What I will do is more research. When I am out over the next few days, I will speak to some recent new business owners (restaurants) and see what assistance the EDA gave to them. I would be curious. I am also going to ask around to see what assistance the EDA provided while Just Food was in the incubation stage of its development.

    As in all things… I guess I have to remember, that not everything is fair, and not everything is equal.

    Not all EDA assistance needs to be monetary… 😎

    I think we can all agree that bringing new businesses to Northfield is a good thing, but I think I share in everyones concerns that you do not impact the existing businesses to get them here. The only way to keep it fair is to provide everyone the same benefit, and if you did not provide it to the first of its kind business in town, then you should not provide it to the new competitor of that type. But in doing so, you limit who the EDA can help…

    Tough quandary this is… time to ponder further.

  20. John,
    this issue was studied in Austin, TX involving Whole Foods and Border Books and Music. Take a look at the study:

    http://www.bookweb.org/files/open/pdf/lamar.pdf
    it’s long, but pgs 3-4 give you a good snapshot.

    If it involves monetary support(tax breaks etc), we the tax payers are subsidizing a chain business to some in and remove money from our community. you could argue, we are paying them to take our money. it is a difficult issue, one that the EDA has to handle very carefully. They have to balance the interests of all sides to do the right thing. I’m not offering an opinion on this daycare company, just some food for thought.

  21. What would be interesting to discuss, is what tools the EDA has in its toolbox to promote and encourage new business.

    What I am asking is, can the EDA promote and encourage new business, without handing out checks and taxbreaks?

    I guess I am saying that the EDA can help everyone, but there should also be varying levels of support.

    Can I have it both ways?

  22. I’m not sure where the idea that we will be subsidizing this business came from. The meeting was purely informational, with the Mr. Streitz explaining his business to the EDA. He also expressed an interest in using the EDA’s Master Development fund loan program for 15K. As part of our toolbox, the ability to make that loan forgivable, as we have for a number of other businesses, was brought up. The forgivable part comes with strings attached – the recipient must meet whatever criteria the EDA deems appropriate to justify the investment (certain employment levels is one example). Since this was an informational meeting, no specifics were discussed and no decisions on what Mr. Streitz will request or what the EDA will support.

    Hope this helps clear up some of the concerns I read in the above posts.

  23. Scott, do go back to the original post by Obremski. She says Streitz said he would be back to the EDA to see what the city could do to help finance his project. Glad to see you have read our responses. I expect you will be hesitant to extend financing, be it $15,000 loan or whatever.

    Griff, it’s a nuisance to have to fill in the required fields each time. What’s up?

  24. Thanks for everyone’s responses! I intend to make some calls and get some answers to the questions posted here.

    I’ve been trying to reach Mr. Streitz to ask him for some more information, but he hasn’t gotten back to me yet. Hopefully I’ll track him down today.

    Thanks Mr. Davis for clarifying Mr. Streitz’s interest in applying for the loan. I wasn’t quite clear on everything said in that conversation about it during the meeting, which is why I worded it so vaguely in the story. I had hoped for Mr. Streitz to explain. Clearly I should have called you or a member of the EDA or a staff person.

  25. Mr. Davis, I’m going to put the information you gave in the body of my story, so people will be more clear about the discussion when they read the article.

  26. A correction to the added lines on Ms. Obremski’s article. The $75650 forgivable loan was to Perkins Transportation on Riverside Drive. The loan was forgivable based on the improvements to the existing warehouse and creation of jobs. I am very glad Perkins is in town, they are a world class business that works on transporting oversized equipment. Thanks for moving to Northfield!

  27. If the tuition at a Goddard school is high (as described), then it might be seen as serving a kind of need: There are those folks who could get around in a used car or a Prius just fine, but they’d like to drive a Lincoln Navigator, BMW or Mercedes SUV, etc.

    I’m skeptical that pre-schoolers get that much more out of yoga than they would get from Northfield Nursery School or other fine preschool institutions in town, but with the crowd that likes to drive the Mercedes SUV, they might feel much better walking from the parking lot to the door to pick up their child. If you’re honest with yourself, you might consider that, if many people had enough disposable income, they might pay a lot to send their kids to a school with children of mostly similar financial means. Face it: Some folks buy new cars that depreciate in value very quickly, but it lets them feel a certain way about themselves.

    As far as the market goes, there is a strain of snobery in Northfield that would sometimes prefer for public education options to be structured in such a way to benefit the white elite: This was long the case with the Companeros program at Bridgewater, which screened out Hispanic kids, and which allowed admissions from any neighborhood, even if you lived near Greenvale school, where the Hispanic kids from the trailer park often attend. Ironically, the Companeros program was the way for white kids near Greenvale to get a ticket out of Greenvale, if they had assertive-consumer parents.

    Some of these parents have enough money for Goddard tuition. Others are educated and assertive-consumer parents who would not be able to afford it. So you weed out the families with educated Democrats who work in human services jobs, to some extent.

    A Goddard School might end up being a place for economically comfortable Republican parents to send their kids. There’s some wisdom in keeping such folks somewhat concentrated in a single area, either to keep them away from bothering the rest of the riff-raff, or to allow them to keep their illusions intact.

    In America, one of our constitutional rights is freedom of association, especially for those who can afford it.

    As at the RNC in St. Paul, the Goddard School could hire police in riot gear, with tasers and pepper spray, to keep the rest of us away, which would also employ more police and stimulate the local economy. Maybe certain benefits would trickle-down.

    I think they should go for it. But no public financing. Let families of potential students invest, like in a time-share. The money’s out there. And local investors could share in the profits. That way, if it fails, they share the risk too, not the taxpayer.

    We don’t need any more taxpayer-supported entitlements and bail-outs and such. Enough of those have gone to the Republicans already, and the grand-children of those who can’t afford Goddard will be paying for a long time.

  28. Thanks Mr. Walinski for that important correction! I fixed the mistake in the story. I apologize for the confusion!

  29. I am confused how a posting about the Goddard school became political (Post #30). Why is it that people try to hijack a posting in order to put forth their political agenda?

  30. Arlen: For one thing, it’s just that time of year.

    For another thing, whether we like it or not, there’s a political (and sometimes class warfare) dimension to many things. Pretending there isn’t doesn’t help.

    For a third, politics was already raised when the topic of public funding was part of the discussion. If taxpayer dollars are to be risked, that’s certainly political.

    Fourth: Discussions of public schools often turn to union-bashing and the sucking sound as tax dollars get spent. Private schools should not be immune to discussions of political or class-warfare issues. There are certainly politics there. It’s only fair. Better to allow free speech about it than to muzzle it.

    Fifth: The Karl Rove playbook prefers first strikes to frame or define the issues. Better to raise the issue first and frame it as class warfare–in which the rich pit themselves against the poor–than to wait for privatization fans to make the first claims that the poor somehow invented class warfare. It’s not true.

    So as in football, you try to gain as many yards as you can, when you can. You don’t wait for the other team to drive into your end-zone.

    That said, I should include a disclaimer: My favorite private school is St. Dominic’s, which was around long before the relatively recent conservative push for school vouchers, and which would admit students even if their families were short of the tuition needed — so none of my criticisms of private schools and class warfare apply to St. Dominic’s.

    Be true to your school.

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