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Inching closer and closer to a resolution

By Staff | Jun 24, 2018

Another couple of steps towards making a deal.

The sale of the Three Sisters buildings to a group called the Rural Renaissance Project took a couple more steps towards becoming reality during action at last Monday night’s Blue Earth City Council meeting.

While they did not take a vote on actually selling the three buildings, they did make several decisions which indicate the city is moving in that direction.

The council voted unanimously to adopt a development agreement with the Rural Renaissance group.

And, they had a first reading of an ordinance that could eventually transfer ownership of the three buildings in downtown Blue Earth at a cost of $1 per building to Rural Renaissance.

The development agreement spells out the responsibilities of the Rural Renaissance group, including having them raise $1 million in 90 days as a good faith gesture to show they can do what they are proposing for the downtown buildings.

The agreement also spells out what the city will do and not do to make the project happen.

The final sale of the buildings could happen after the second reading of the property transfer ordinance, which is set to happen at the council’s July 2 meeting.

According to Blue Earth’s City Charter, sale of land or buildings by the city can only happen by passage of a city ordinance.

After any passage of the ordinance, one more document, a purchase agreement spelling details of the sale, would also be created.

Janie Hanson, a representative of Rural Renaissance, told the council she was comfortable with the stipulation of raising the $1 million, but the timing may be a problem.

“We will begin our fundraising with a kickoff at Giant Days,” she said. “We needed something in writing to show those who are planning on donating that we will be getting the buildings.”

Councilman Dan Warner said he felt the $1 million number might be too high.

“I think a lower number, like maybe $500,000, might be better,” Warner said. “I don’t want this to be any kind of a hold up on the project.”

Later, Warner also questioned the development agreement, asking if there was any specific way the city could protect any funds they put into the work.

“I like the idea of having a development agreement. If the city is into it for $300,000, then the city needs to have a way to get that back if the project is not completed for any reason.”

The document does provide for the city to take back the Three Sisters, should the project not be completed in two years, city attorney David Frundt answered. And that would be with any improvements to the buildings that have been made.

“The document also recognizes the city’s indication of a willingness to invest another $150,000 grant into the project, in addition to what has already been done,” Frundt said. “But that is up to the council for a final decision.”

In other business at Monday night’s meeting, the council:

Accepted the sale of $4.075 million in General Obligation Bonds that will be used for financing various public improvement projects in the city, including a new Public Works building, the current street improvement project and the housing development on the northeast side of town.

The interest rate on the bonds was at 3.27 percent.

Springsted agent Doug Green who presented the bond sale results, said the city also retained its A+ bond rating.

Held a closed session to conduct the review of city administrator Tim Ibisch.

After the closed session, Mayor Rick Scholtes reported that the council reviewed the administrator’s performance in 11 different categories, from organizational skills to technology ability.

Ibisch received an average score from the council across all 11 categories of 8.89 on a scale of 1 to 10. It was the same score the administrator had received last year.

“We are very happy to have Tim as our administrator,” Mayor Scholtes said. “We look forward to having him working for us for many years to come.”

Heard update from city engineer Wes Brown of Bolton & Menk about the various projects going on at this time around town.

He said the 13th and Moore street project has been going well but now has a hang up with CenterPoint Energy locating gas lines, which may interfere with utility lines and may have to be moved. That will cause a delay until mid-July.

South of 14th Street work is still progressing well, however, Brown noted. He also presented a change order from the contractor that called for a decrease of $10,000 in the project cost.

The new housing development is going very slow, due to water problems and poor soil conditions, but some progress is being made.

The wastewater treatment plant construction site has been cleaned up, and the City Council will tour the site as part of their work session at the July 16 meeting.

Heard a quarterly update from Mary Kennedy about the Blue Earth Economic Development Authority, including a new program called Business Spotlight which will highlight a Blue Earth business each month.

Granted a temporary liquor license for Giant Days to both the Eagles Club and to Rural Renaissance, plus granted a food vendor license to J&J Cafe for a food trailer operation.