The Preston City Council met on July 5 for their regular meeting. Gabby Kinneberg, in her role as EDA director, reported on two separate option agreements for the possible purchase of 3.7 acres for a Park Lane development.
A Housing Committee formed in 2018 worked to compile areas for residential expansion. The Park Lane area was one of these areas; it could possibly be developed into medium density residential housing. The city/EDA worked with two landowners, Cliff and Rita Sackett (about three acres) and Helen Winslow (about one acre), negotiating a value of $15,000 per acre. Both option agreements will expire on August 3 if not extended. The option agreements were for two years, which can be extended to three years.
Kinneberg said the EDA board has recommended extending the option agreements for one year. The cost to extend each agreement from two years to three years is $250 or $500 for both. The cost is to be paid for out of the EDA’s Development Reserve account. She made it clear that extending the agreements does not obligate the city to purchase either of the properties. It just keeps the options available if there is interest from developers.
It was noted it will likely cost about $500,000 to provide necessary infrastructure for 12 lots. Mayor Kurt Reicks expressed concern questioning whether it would be fair for the city to buy property and then sell it below cost. Is it fair to other developers? He asked, “Is the city in the real estate business; I don’t think we are.”
City Administrator Ryan Throckmorton explained this extension of the options is a one-time thing. A developer might be interested in the terms the city has negotiated. Kinneberg admitted there are a lot of assumptions being made, for example TIF, to help bring lot prices down. The council voted to extend the option agreements for one year as recommended by the EDA.
Other business in brief
• City Engineer Brett Grabau presented pay request #8 from Alcon Excavating, Inc. for the 2021 Street and Utility Improvement Project. He maintained we don’t pay for anything that is not complete. The council approved the payment of $281,645.52 as presented. The city is still holding a 3% retainage of $93,631.12. A total of $36,000 is being held for liquidated damages. The damages are due to the project not being substantially completed by October 22, 2021. Grabau said the withholding of the $36,000 can be discussed/adjusted by the city council.
• A setback variance of two feet for a utility/storage shed from the main building was approved as recommended by Planning & Zoning for Bruce Hoff, 505 North St. NW. City code requires a 12-foot setback; Hoff requested a 10-foot setback.
• Craig and Vickie Hildestad, owners of Trout City Brewing, requested a Small Cities Development Loan to repair and restore the white building that is connected to Trout City Brewing, to repair the back patio, and to add a fence. They requested the forgivable loan in the amount of $10,000. They will provide funds of about $4,000 to complete the work to help bring the building back to its historic appearance. The Small Cities Development Loan was approved as recommended by the EDA.
• Preston purchases property, liability, and workers compensation insurance through the League of Minnesota Cities Insurance Trust. As Preston has always done in the past, the city council voted to not waive monetary limits ($500,000 per claimant and $1,500,000 per occurrence) on municipal tort liability.
• A resolution was approved calling for a special election for the vacancy left by David Collett (two years left on the council seat term). Steve Hall, who was appointed by the city council to fill a vacancy, will file for the special election to complete the four-year term. The special election will be held along with the general election, so there will be no additional cost or time for the special election.
• The next regular city council meeting will be on July 18 at 6 p.m. A special city council meeting will be held on July 25 at 8 a.m.
Leave a Reply