Blue Earth’s Three Sisters, shown here, are now totally owned by Project 3 Sisters.

At a regularly scheduled meeting on Monday, Oct. 18, The Blue Earth City Council parted ways with local Project 3 Sisters LLC. Closure regarding the project has been long-awaited by the Blue Earth community.

Rural Renaissance’s Project 3 Sisters concerns the rehabilitation of three buildings located on Blue Earth’s downtown Main Street. Project 3 Sisters was founded as a subsidiary of Rural Renaissance in 2019 for the purpose of owning the properties.

The organization entered into a purchase agreement with Blue Earth and its Economic Development Authority (EDA) board to gain ownership of the properties. The purchase agreement contained project timing stipulations which have since become a source of strife for both the city and the Project 3 Sisters representatives.

Due to various complications, several of the project’s extended deadlines have not been met.

Many council members have grown frustrated at the continual revisions and extensions which have been added to the purchase agreement.

Council member Ann Hanna noted, “Each time the items required by the city were reduced from the original development agreement in order to ensure success. And yet, they have not been met.”

After Project 3 Sisters failed to meet an extended Sept. 30 deadline, the Blue Earth EDA board met with the project representatives to discuss terms at their regularly scheduled meeting on Thursday, Oct. 14.

After a long discussion, the EDA board drafted a recommendation for the Blue Earth City Council explaining how they felt negotiations should proceed.

The EDA suggested that the Rural Renaissance Project (RRP) group provide the EDA board with several documents for review within the next 60 days.

The requested documents would include a list of entities under consideration by Project 3 Sisters for private ownership, a letter of commitment of at least $500,000 from a financial institution, and a list of all purchased equipment for the project to date.

The EDA suggested, “In the case that RRP meets the terms, RRP will have full ownership, title, and deed to the buildings.”

The EDA countered, “In the event that RRP does not meet the terms, the City/EDA will have full ownership, title, and deed to the buildings, and RRP will release all claims, liens, and judgement against the City/EDA.”

Though this was the EDA’s recommendation to the Blue Earth City Council, the council had the final say as to how they wished to proceed.

Hanna preferred a different response to the situation.

“I must say I am tired of all the back and forth conversations,” Hanna said.

She continued, “I would like to make a motion to this council that we allow the title to go to the Three Sisters Project, Connect the Grey, Rural Renaissance, whatever name works, stating all items of the development agreement have been met or waived, with the stipulation that any of the above, or any new entities, will not be allowed to file for any monies from the city of Blue Earth, including the EDA or any other boards, for 10 years.”  

EDA specialist Amy Schaefer was present at the meeting on behalf of the EDA. She inquired, “Is any business that goes into their facility also not eligible (for city financial assistance)?” 

City attorney David Frundt responded, “That’s separate. We can encourage businesses to come in and use their space.” 

The community expressed additional concerns as to whether the project is being funded by the city, and whether Project 3 Sisters is making efforts to employ local contractors.

Blue Earth’s Electric Service, Co. (ESCO) voiced these concerns in a letter addressed to Schaefer.

“We understand there are many options available when looking for a contractor, and there are many skilled specialized and general contractors in our county. If county EDA money is being used for a project, doesn’t it make sense that county contractors should be employed to perform the work?” the letter inquired.

The council responded to the concerns expressed through the correspondence.

“I want people to know we are not funding this, or anything (related to the project) in the future,” Hanna first clarified.

Nathan Wright, Project 3 Sisters’s project manager, also wished to clarify Project 3 Sisters’s choice to work with Knutson Construction, a company which operates out of the Twin Cities and which has been running the project’s preconstruction.

“There was a wide net thrown locally,” Wright explained. “We went with Knutson so they could cast their net wider, finding other contractors who were able to do the work.” For example, Wright shared two of the project’s contractors are based in Wells.

He added, “I love to hire people within the community. I called some local contractors, and a lot of people just didn’t have the time to take on the project as it was.”

Wright concluded, “The entire essence of how we did what we did is to try and get things moving as fast and efficiently, and as safely as possible.”

Council member John Huisman inquired whether Wright would consider parting ways with Knutson in the hopes that a different company would run the project more efficiently.

“In your opinion, how big of a priority is a three-building project down here to Knutson?” Huisman reasoned.

Wright responded, “When I came into the project two years ago, they already had an intimate knowledge of the project.”

Wright added he feels delays to the project are more to do with supply chain issues which are plaguing much of the construction industry at this time.

After asking a few more clarifying questions, Hanna stated, “Obviously they (Project 3 Sisters) have structures in place. They are trying their hardest to make it work.” 

She concluded, “I think the city is trying to control these people to the point where it is getting almost ridiculous. Let it go, let them make it whatever they can. If it works, wonderful.”

The council ultimately passed her motion with a 5-1 vote, thereby granting ownership of the buildings fully to Project 3 Sisters. The dissenting vote was from council member Huisman.

“We want progress,” said council member Russ Erichsrud.

Other business discussed by the council included:

• An idea regarding the new tennis courts’ construction. While plans are currently in place to construct the courts on Blue Earth Area High School grounds, council member Glenn Gaylord suggested constructing courts on HRA-owned property near Putnam Park instead.

Gaylord reasoned planned improvements at the park could be merged with the tennis court project, thereby saving time and money.

“It doesn’t make sense to me to have a major project at the high school and at Putnam Park, when we both want the same thing,” Gaylord said.

City administrator Mary Kennedy did have some concerns. “The HRA has planned for a long time for that to be new development. There’s a possibility the HRA might not be interested in this,” she said.

The council plans to communicate with the HRA regarding the proposal and gauge the HRA’s interest in Gaylord’s suggestion.  

• The condition of Blue Earth’s baseball dugouts. President of the Blue Earth Baseball Association Brent Legred brought the dugouts’ poor condition to the council’s attention and requested funding for their renovation. The council agreed to keep the matter in mind as they discuss the 2022 budget.

• The recently-released 2020 census data. Counts from April 1, 2020, revealed Blue Earth’s total population to be 3,174, with a household population of 3,061 and a group quarters population of 113.

The total count of housing units came to 1,622, with 1,442 occupied units and 180 vacant units.