The proposed Lake Vermilion State Park, an idea once-thought dead, has new life this week after Department of Natural Resources officials announced they have reached an agreement to pay $18 million for approximately 3,000 acres of land on Vermilion's eastern shore from US Steel. The park could be open for limited day use as early as mid-summer 2011. Construction of a fully-functional park will likely take three years or more, and cost $25-$30 million, according to DNR officials.

The deal must still pass muster with the Legislature, in part because the agreed-upon price may exceed the provisions approved by legislators two years ago when they authorized $20 million in bonding for park acquisition and development. But DNR Commissioner Mark Holsten said it isn't clear if the price exceeds legislative authority or not. In either case, he said the $18 million purchase price includes an additional 500 acres of land, located south of Hwy. 169, that was not a part of the original discussions.

The park announcement was a bolt from the blue for residents of the Tower-Soudan area, where support for the park has been high. "That's great news," said Tower City Clerk Tim Kotzian. "A little unexpected but it makes my day. It's certainly going to help the economy and the school enrollment up here."

"It's fantastic," said Tower City Councilor Richard Hanson. "With the harbor project and everything, this fits in perfectly. I'm thrilled."

While the final details of a purchase agreement are still being worked out, Department of Natural Resources Commissioner Mark Holsten confirmed in a Friday afternoon press conference that the deal had been reached on a price. The agreement should end plans by US Steel for its Three Bays development project, which had been slated to see initial construction work begin this spring.

According to Minnesota State Parks Director Courtland Nelson, the DNR is now planning to reassemble the park task force which had been meeting on the park two years ago, but was disbanded after the state and the company were unable to reach a deal. "We'll be picking up the planning process where it left off," he said.

According to Nelson, the DNR will focus initially on resource analysis work. "We'll hopefully be able to do that in the spring and summer," said Nelson. "Then we'll be able to lay out the long term options for development."

The deal was sudden

DNR officials were unable to shed much light on the details of the agreement, or how it came about. But Holsten said the talks started up again last fall, at the initiative of Gov. Tim Pawlenty. He said US Steel officials had agreed to talk again, which the two sides did in late November. Those discussions eventually led to the agreement announced Friday.