Minutes - Council - 02/19/2008 - Special

Home

Tuesday, February 26, 2008 and that a policy be established for showing this financial information for all real estate transactions. Further Discussion: City Attorney Goodrich stated that Bury and Carlson wants to close on the property by March 31, 2008, so the very latest the Council could vote on this issue would be next Tuesday, February 26, 2008. Councilmember Dehen asked why there was such an urgency to move forward with this property. Public Works Director Olson stated that Bury Carlson has other offers on ~he property. He asked for specific type of financial information the Council is looking for. Councilmember Look stated that he would like to see the value of the $1.7 million in terms of current investment. City Administrator Ulrich clarified that he feels the Council would like to know how much money the City would earn in investments, if it did not spend the $1.7 million to purchase the property. He stated that the Council should remember that the land will potentially cost more to purchase in 5 or 10 years and there may even be eminent domain or condemnation costs. Assistant City Administrator Nelson stated that a ballpark figure for what is earned from investments is roughly 3%, so it would be approximately $52,000 per year. City Administrator Ulrich stated that the current proposal eliminates uncertainty for the City by allowing the City to get 20 acres of property from a willing seller. Councilmember Look asked what the value is of the current public works land. Public Works Director Olson stated that there are six acres and two of them were purchased with EDA money. He noted that the land value has been estimated at about $4 per square foot, which would be about $640,000. He stated that did not include this money in the equation for the Bury and Carlson property because he felt this would offset the building expenses for the new property. Councilmember Olson stated that the only reason she made the motion was to make sure that everyone on the Council was comfortable with the financing and stated that she was willing to withdraw the motion if everyone was now comfortable with the financial implications. Motion failed. V oting Yes: None. Voting No: Mayor Gamec, Councilmembers Olson, Look, Dehen, Jeffrey, and Strommen. Members Absent: Councilmember Elvig. Councilmember Dehen asked if City Administrator Ulrich was comfortable with this proposal and that all the City's I's would be dotted and T's crossed. City Administrator Ulrich stated that he is comfortable with the proposal and thinks it is a good investment for the City at a fair price. He stated that he recommends that the City purchase this property. Councilmember Look stated that he just wants to make sure that this would be the right thing to pursue in light of the future expenditures the City will have. City Attorney Goodrich reviewed the wording for a motion to authorize this purchase. Motion by Mayor Gamec, seconded by Councilmember Strommen, to authorize City staff to continue negotiating the Purchase Agreement and Lease for the Bury and Carlson property consistent with terms discussed at the closed session on February 12,2008 including a purchase price of $1,753,000 and per the terms of the Purchase Agreement and Lease reviewed on Special City Council Meeting /February 19,2008 Page 7 of9