City tackles lengthy agenda filled with many land issues at Monday meeting
MONDAY, AUGUST 8, 2016 — Acting Mayor Lance Dougherty called the regular meeting of Tower’s City Council to order noting that Mayor Josh Carlson was expected to be about 15 minutes late. The lengthy agenda was filled with land and land use issues as varied as newly proposed developments, land sales and Main Street building demolition. Following approval of the minutes of the council’s July 11 meeting and accepting the agenda, Dougherty called on Jeff Hill who had corresponded with the city seeking time on its busy agenda to propose a tiny house development in Tower.
Hill wants to build a tiny house community and he wants Tower’s help. “Tiny Village USA is a cooperative and we are looking for land,” Jeff Hill said by way of introduction of his project to the Tower City Council. Hill said that he is hoping that the city would approve the development and donate land to get it started. Tiny houses are in demand by millennials (young adults who reached adulthood at the turn of the century) who are seeking experiences over possessions, according to Hill. “Tiny houses are between 140 and 400 square feet and efficient to heat,” Hill said. “We are seeking a group of about a dozen people, or more and are looking at starting a 10 unit development,” Hill explained as he referred the council to a diagram of Tower’s North Hill depicting over 50 units scattered throughout the area. “We think the North Hill would be a perfect place for the development,” Hill said, citing the Lake Vermilion views and the proximity to city water and sewer infrastructure. “We will meet or exceed all zoning requirements once they are adopted. We want good people, not riff raff.” Hill said. The fact sheet Hill provided the council states, “With community support and involvement, we are dedicated to establishing a safe, healthy, and drug-free environment where resident can have safe affordable Shelter can come to live in dignity and in peace … (sic)”
“Are you looking at other areas? That’s prime real estate up there,” Alderman Joan Broten questioned. Hill explained that bankers would call the North Hill a non-performing asset and suggested that the city could lease lots in the development and would receive lease fees as well as personal property taxes on the tiny houses. He provided airport hanger leases as an example of a model which could be used to generate income for the city.
“You are talking about acquiring donated land — how are you going to get started — get houses?” Acting Mayor Dougherty asked. The first step would be to form a committee, Hill suggested. “We would like someone from the city and the community,” Hill said, “Then we can work this out at the committee level.” Following more discussion Alderman Broten made a motion, which Dougherty supported, to establish a committee to look into the project. The motion passed with unanimous support from the council. City Clerk–Treasurer Linda Keith, Jeff Hill and Douglas Workman will comprise the committee.
At the conclusion of the city council’s discussion of the tiny house project Mayor Carlson arrived in the council chambers. Acting Mayor Dougherty said, “We’ve gotten as far as 5.2 on the agenda,” as he turned the gavel over to Mayor Carlson.
Potential new Main Street business
The city council turned its attention to correspondence received from Brandt’s Greenhouse owner James Brandt. His email letter expressed interest in a small 25 foot parcel on Tower’s Main Street located between The Tower News and Vermilion Fuel and Food. Brandt wrote that he would be interested in bidding on the property if Tower puts it up for sale and hopes to develop a retail sales location featuring bedding plants grown at his greenhouses in Kugler, fresh fruit and vegetables in season, Halloween pumpkins and Christmas wreaths and trees if he should acquire the property.
According to Clerk Keith the city was working with Vermilion Fuel and Food owner Terry Wagoner to help him reacquire the property. Apparently the property went tax forfeit during the time when Wagoner had his Vermilion Fuel and Food business sold under contract for deed and when he cancelled that contract the lot in question had already been seized by St. Louis County. “Terry is asking the city to stay out of it, as he has legal action with the county forthcoming,” Keith said.
“I think this would bring a lot of traffic to Main Street,” Mayor Carlson said in reply to Alderman Broten’s question on what benefits Tower might realize from the business opportunity Brandt has proposed. “It looks like he’s talking about a business that would be more than seasonal, bringing in people for most of the year,” Mayor Carlson said. “I think we should talk to him about other locations in the city as well,” Mayor Carlson concluded. The city took no action on Brandt’s request at this meeting, seemingly waiting on Wagoner’s proposed legal action to unfold.
Power Sports of Minnesota Inc. Environmental Assessment Worksheet
One of the conditions required of Dave Rose, Power Sports of Minnesota, Inc., in his application for a conditional use permit to develop a recreational vehicle campground on East Two Rivers is to have completed a State Environmental Assesment Worksheet (EAW). Short Elliott Hendrickson, Inc. (SEH) engineer Jason Chopp was on hand at the council meeting to discuss the process for preparing the EAW. According to a letter written by Matt Bolff, a SEH engineer, the first step would be for Rose to complete his conditional use application before Tower incurs the costs of an EAW. According to Bolff, the cost of the EAW could run as high as $39,000, depending on the amount of work involved. This figure allows for $8,000 to be spent on a cultural resources review on the site. Bolff anticipates that an archaeology survey might be required because of the East Two River location. “The estimated cost could go down if the cultural resource review is not needed,” Bolff’s letter stated.
“I don’t anticipate us paying for this,” Mayor Carlson said. “If Mr. Rose is willing to put money into escrow, to pay for this, then I would be willing to call for the EAW,” Mayor Carlson concluded. The balance of the city council was in agreement with the Mayor’s sentiments. Alderman Dougherty made a motion to have Power Sports of Minnesota, Inc. pay for the EAW. Alderman William Hiltunen supported the motion which passed with a unanimous vote of the city council.
A letter from the city has been prepared and will be sent to Rose detailing all the requirements he needs to complete to finish up his application for a conditional use permit to build his proposed campground on the land he owns adjacent to East Two River.
Agreement reached on payment terms on 511 Main Street demolition
The old Stefanich Meat Market building at 511 Main Street has been in disrepair for years and the city and building owner Karel Winkelaar have come to an agreement on how the $15,000 demolition bill will be divided between Winkelaar, the city and St. Louis County. The county has offered to pay $5,000 of the expense leaving the question of how the remaining balance would be paid to still be answered.
“I’m willing to pay five thousand, but am not willing to go for all ten thousand,” Winkelaar told the council. The meat market building is nestled between the old hardware store building and Sulu’s Espresso Cafe and the planned demolition of the hardware store will affect the meat market building just as the demolition of the meat market will affect Sulu’s because of the way many 19th century buildings were constructed on Main Street. It will cost $10,000 to repair the Sulu’s building wall when the demolition is complete, according to Winkelaar. Adding that cost to the amount he paid for the meat market building and the property taxes and insurance over the time he has owned it makes the project cost prohibitive according to Winkelaar.
“I was going to allow it (the meat market) to go back to the county, but decided to pay up the back taxes,” Winkelaar said. He changed his mind and decided it would be best to negotiate with the city to share the demolition costs and beautify the Main Street instead. He has plans to use the space created by the demolition as seasonal patio seating if he and the city can come to an agreement on sharing the costs of the demolition, Winkelaar said.
“Are you willing to sell the building for the nine thousand you paid for it?” Alderman Broten asked. Winkelaar said that he had more into it than just $9,000, noting the property taxes he has paid and other expenses he has incurred.
“You already benefit with the five thousand dollars the county is giving towards the demolition. I’m not willing to give you any city money,” Alderman Dougherty said. Winkelaar maintained that one option he had would be to quit paying taxes on the building and deal with the city blight ordinance. “You’ve already given me a blight ticket,” Winkelaar said, as he went on to explain that he was willing to negotiate with the city to eliminate the existing blight, but was unwilling to bear the entire cost of the project.
“You need to understand that five thousand dollars is one and a half percent of our tax levy,” Mayor Carlson said. “Would you be willing to go up to seventy-five hundred?” Alderman Broten asked. “I would, if I could take a five-year city Main Steet improvement loan,” Winkelaar replied.
“I don’t often readily agree with Karel, but for a lousy five thousand dollars we can get rid of the blighted building and it’s an improvement to Main Street,” Steve Altenberg said from the audience.
The hardware building was already the source of serious blight issues, City Clerk Keith told the council. The back of the building is open and there are signs that people have been squatting in the building and it appears that kids have been partying in the building. There are also animals residing in the building and the ceiling is collapsing onto the floor, Keith said. Because all three buildings are adjacent to each other, one can’t be demolished without affecting the next one and whichever building was left would need to have considerable repair to its outside wall when the neighboring structure was raised. It only makes sense to make those repairs on a building worth saving.
“I know what you’ve got into it — but it’s not our problem,” Mayor Carlson told Winkelaar.
The council and Winkelaar settled on the compromise, accepting the county paying $5,000, Winkelaar $7,500 and leaving $2,500 as the city’s contribution to the project. Alderman Hiltunen made a motion, supported by Alderman Dougherty, to have the city pay the $2,500 and to make Winkelaar a $7,500 Main Street improvement loan, provided that all the property taxes were kept current. The motion passed with unanimous support of the council.
City land sales
Janisch Realty presented the City Council with a counter offer of $27,500 for a 38.17 acre parcel located in Kugler Township, south of Tower. The city is currently asking $34,500 for this parcel it owns. Clerk Keith explained that the offer was lower than the asking price and lower than a recent sale Tower made in that area. However this parcel has considerably more wetlands than the parcel which sold. Keith suggested, after consulting with Lisa Janisch, the city’s listing real estate agent, that this was the best offer the council could expect. Mayor Carlson made a motion to accept the $27,500 offer. The motion passed with unanimous support.
The city council also has two 40 acre parcels immediately adjacent to the Boundary Waters Canoe Area off the Mud Creek Road it has been trying to market. There is currently no available access to either parcel. According to Keith, the city currently pays taxes on each parcel. The St. Louis County Assessor’s office has valued one parcel at $32,300, with an annual tax bill of $350. The adjacent parcel is valued by the county at $18,200 with the annual taxes at $198. Keith reported to the council that Janisch has been unable to find buyers at the current asking price of $36,000 for each parcel. Keith suggested that the council authorize Keith to work with Janisch in establishing a new offering price, one that could be reduced incrementally, over time, until a purchase offer is achieved, or the city reaches the bottom limit of what it is willing to accept. “Lisa (Janisch), and I have prices in mind, but I don’t want to mention our bottom price here, because it will end up in the newspapers,” Keith said.
Alderman Dougherty suggested that the city look into the timber value and have the property logged, but withdrew that idea when he was reminded that the property was not accessible. Mayor Carlson moved to give authorization to Clerk Keith to work with Janisch on setting new pricing and to enter into a new listing agreement. The motion was supported by Alderman Hiltunen. Dougherty said that the city was paying property taxes on the land and should seek to sell it and eliminate that annual obligation. The motion to relist the property for sale passed with the unanimous approval of the city council.