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Rushford loses USDA grant and loan

By Kirsten Zoellner

Mon, Jun 11th, 2012
Posted in Rushford All

Two days after the last city council meeting, Rushford was hopeful they could meet a June 30 deadline for the city hall and library projects. However, it was unclear whether the city would be granted any funding through a USDA American Recovery and Reinvestment Act program due to massive changes in the project(s). A day later, it was clear the deadline couldn’t be met and City Administrator officially requested the USDA to de-obligate the loan and grant, citing an inability to meet plan and specification requirements. This potential outcome had been touched on at the May 28 council meeting and some anticipated that the city would need to seek funding elsewhere for the reduced project.

Originally awarded the $250,000 grant and up to a $2.234 million loan, a 40-year note at 4.25 percent interest, the funding had come in a long line of successive fundraising efforts by the Library Board.

Beginning in late 2007, and following nearly eight years of studies and surveys in relation to the library, the city was awarded a sought-out Brownfield Beautification Grant from Minnesota DEED (Department of Employment and Economic Development). The matching grant, in the amount of $617,600, was aimed at property acquisition and building demolition for a new city center project on the former G.S. Woxland lot on the corner of Park and Mill Streets. The property was aquired in April of 2008 and by early 2009, a capital campaign was in full swing with hopes of raising additional funding for the project, which at that time was estimated at $3.4 million, minus an optimistic $1.2 million in fundraising efforts.

In August 2010, the new council voted to reverse the decision of the previous council and removed the city hall portion from the library project. Changes continued the following year as the project was scaled back further from the original 9,000 to 7,000 square feet, per the requested of the council sub-committee, and Library Board requested alternative project funding from FEMA, which had originally been intended for the community center in the Himlie Business Park.

The board originally intended to purchase two other adjacent properties with the Brownfield Grant, including the Litscher’s Processing facility. In December 2011, the council rejected the purchase of the facility and lot with the grant funding. Two months later, the council terminated the plan for a new library entirely, instead voting to confine the library to the current Tew Memorial Building and opting for a remodel of the site. According to Library Director, that one move alone eliminated $45,500 gift donations, $74,000 in pledge donations, and $60,000 of in-kind donations, a cumulative $179,500 that were specified for a new facility only.

Wanting to keep the project moving, the city encouraged the board to seek potential renovation figures and River Architects began drafting preliminary plans for the remodel of the facility. Two such options were presented at the May 28 meeting; a $1,341,000 renovation/addition plan and a $810,000 of both the main and lower floors of the Tew building without an addition. Both plans were met with council concern, citing a lack of desire to add further debt to the city and burden to the taxpayers. By the end of the evening, the council had approved requesting $800,000 from the USDA, $600,000 for the library project and $200,000 to fund the conversion of the former municipal liquor store conversion to a new city hall.

Without the USDA grant and loan, the city will be forced to look elsewhere for funding. Contact has already been made with USDA for the application to request and hopefully secure a new, reduced loan. The plans and specs for the city hall project are complete, should funding be granted and project bidding commence soon after. The Library Board, meanwhile, will wait for further direction of the council as funding sources for the project are sought. The Library board still maintains that a remodel of the facility, at an architect-recommended minimum of $810,000, is not in the best interest of the community or the best use of public dollars in the long run. Rather, the board maintains a new facility holds the most vision for the future.

The topic will likely be on the agenda of the next council meeting, June 11, as the city attempts to move the projects forward.

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