Agenda - Economic Development Authority - 10/08/2009

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As you know, Al Pearson had served for years as City Councilman and has served in other capacities on the City of Ramsey's various boards. He and his brother, Dave Pearson, and I, on behalf of Dennis Pearson, are the principal parties involved in the Pearson Properties company that owns the land which we are now offering to the City. We recognize that the land to the east of the Pearson Properties sold in excess of $100,000.00 per acre. We also realize that the price per acre during this more difficult time is significantly lower and we would offer the property to the City of Ramsey under the following terms at $60,000.00 per acre: 126 acres (less the farmstead) at $60,000.00 per acre equals $7,560,000.00. The farmstead is approximately 6 acres and would be excepted from this sale which would reduce the total price to $7,200,000.00. An installment sales agreement or purchase with mortgage back to the Pearsons ( dependmg upon the most advantageous income tax results for the Pearsons) would involve a $3,000,000.00 down payment and the balance of $4,200,000.00 at 5% interest with principal and interest payments in the approximate amount of $500,000.00 per year commencing with the first year following the payment of the down payment. During the period of time until the land IS paid off, the real estate taxes would be paId by the City and the Pearsons would continue to live on and work the land. When the highway right-of-way is expanded, the Pearsons would then sell off the farmstead and any land not taken for highway right-of-way would then be available for the City to purchase at the same rate indicated herein. This way the Pearsons could continue to utilize the farm buildings during the period of time that development was created or is being anticipated and then the farmland would be rented at a rate consistent with the farmland currently being rented by the Pearsons elsewhere in the location. We had been meeting with a local developer/investor and had met with others over the last year. After evaluatmg the options, we are convinced that the City would benefit by purchasing this land and being able to provide incentives as indicated. Also, the opportunities for park development in the land closest to the river would seem to be beneficial to any residents of the community since the tree area has already been created. We remain available to discuss this matter with you at your convenience and we look forward to future discussions and/or mutually beneficial negotiations. Thank you again for the City and Economic Development Commission's consideration of this matter. On behalf of the Pearsons we thank you and look forward to hearing from you. RWO:kb cc: Al & Dave Pearson 12