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When Indianapolis developer David Flaherty proposed his housing project in Ramsey, he looked beyond the city's mostly vacant 400-acre development area and focused on the railroad tracks in the distance.
"We want to build high-density housing where you'll be able to walk from your apartment unit to the rail station," Flaherty said. "This whole project was dependent on Ramsey getting a Northstar commuter rail station."
From potato fields in Big Lake to empty lots in Ramsey once linked with defaulted loans and bank fraud, cities along the Northstar commuter line see their rail stations as key selling points to lure new development.
Although the two-year-old, 41-mile Northstar line has struggled to meet ridership projections, city and business officials see signs a commuter line can flourish someday, even during high unemployment.
"In the midst of a very bad economy, these stations have attracted investment," said Hennepin County Commissioner Peter McLaughlin, a driving force behind Northstar and other rail lines. "The space and opportunities are there."
Nowhere has that message echoed louder than in tiny Big Lake.
"Northstar put Big Lake on the map," said Katie Larsen, senior city planner.
With 10,000 residents, Big Lake is the least populated of cities with Northstar stations. But with 300 available acres and a role as a hub for bus riders who come 30 miles from St. Cloud to hop the Northstar to Minneapolis, Big Lake leaders envision a developer's dream.
"People driving through Big Lake a few years ago saw potato fields," said former City Council Member Chuck Heitz. "Developers saw a potential gold mine."
The developers began making inquiries at least two years before Northstar's maiden run from Big Lake to Minneapolis in November 2009.
Larsen and Leslie Dingham, Big Lake's economic development specialist, had just been hired by the city. Instead of pouncing on potential opportunities, they stepped back, reminding themselves this was a commuter train they were talking about -- a train to get people to work during an economy in which many were suddenly out of work.
"The difference between commuter and light rail is there isn't going to be anything happening around the station during the day," Larsen said.
"The train isn't going to be the driving force for retail development," she said. "It's an amenity."
Larsen said she believes that passengers will one day get off at the Big Lake station, buy a newspaper, head to a coffee shop or other stores and mill around. But city officials were convinced they would need "at least 100 new rooftops" before retail develops, probably in 10 years, Larsen said.
A 33-unit townhouse development is underway. Big Lake will soon have a 20-unit assisted-living complex, and a 72-unit apartment complex recently received City Council approval, Larsen said. "Are these developments directly related to Northstar?" she asked. "I believe so."
Big numbers in Big Lake
Northstar's ridership last year from January through November was 2 percent lower than during the same 11 months in 2010, according to Metro Transit. But a freight derailment in Fridley that took the track out of service for several days in mid-July was a factor. So was the drop in downtown sporting events -- the Metrodome was out of service in January after the roof collapsed and there were no Twins playoff games at Target Field.
Still, Big Lake saw the biggest ridership among the six stations: 97,699 rides from January to November 2011. Elk River was next with nearly 92,500.
Big Lake officials feel the down economy even helped them, because they were able to go slowly in forming a development strategy.
"If not for that, we wouldn't have had a plan in place by the time the train rolled out of our station in 2009," Larsen said.
By contrast, Ramsey's more aggressive approach -- seeking funding for projects years before being guaranteed a rail station -- did not pay off. The city between Elk River and Anoka was considered a sure bet for a station in 1997, when plans for the commuter line originated.
Then budget concerns cut the route in half and eliminated, at least temporarily, a station in Ramsey.
It was a tremendous blow to the $1.3 billion Ramsey Town Center project. Other troubles included mismanagement, a defaulted loan and a federal investigation that resulted in a fraud conviction and prison term for one Forest Lake banker.
The development area, renamed "COR of Ramsey," is starting to rebound with last year's additions of a Veterans Affairs clinic, the Falls Cafe and an Allina Health Clinic.
But the basis for the project has always been transit-oriented development, said City Administrator Kurt Ulrich, and Ramsey now is assured of funding for a $13.2 million Northstar station to open this fall.
Flaherty & Collins Properties will begin building another 230-unit complex in Ramsey in March, Flaherty said.
"There are only 100 of these commuter lines in the whole country," Flaherty said. "It's a great opportunity."
Paul Levy • 612-673-4419