Serving Northern St. Louis County, Minnesota

Local reaction to park mostly positive

Legislators have mixed opinions, but most think Legislature will back the park

Marshall Helmberger
Posted 1/22/10

The proposed Lake Vermilion State Park has new life this week, following a surprise announcement by Gov. Tim Pawlenty that US Steel had agreed to the sale of 3,000 acres of land for the park for $18 …

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Local reaction to park mostly positive

Legislators have mixed opinions, but most think Legislature will back the park


The proposed Lake Vermilion State Park has new life this week, following a surprise announcement by Gov. Tim Pawlenty that US Steel had agreed to the sale of 3,000 acres of land for the park for $18 million. The agreement, announced last Friday morning, sets the stage for creation of the state’s newest state park and one of its most spectacular.

“This will be one of the crown jewels of the state park system,” said DNR Commissioner Mark Holsten in a Jan. 15 press conference.

US Steel and the state must still work out the details of a purchase agreement for the property, located on Vermilion’s east end, and the state Legislature will need to tweak legislation that had limited the amount of money the state could pay for the land.

Still, the resurrection of the park proposal was welcome news to many in the Tower-Soudan area. “It’s fantastic,” said Tower City Councilor Richard Hanson. “With the harbor project and everything, this fits in perfectly. I’m thrilled.”

“It’s great news,” agreed Lake Vermilion Chamber President Troy Swanson. “It will open up a lot of opportunities for everyone in the area. I’m really excited about the things that are going to happen here.”

“It’s a huge win,” said Tower Mayor Steve Abrahamson. “Numbers are the name of the game if local businesses are to survive and this helps a lot.”

Some area officials, however, did have concerns about the park plan. Ely Mayor Roger Skraba said he was worried that the state park would increase lake traffic, probably significantly more than US Steel’s proposed Three Bays development. That’s a concern shared by others, according to Phil Bakken, chairman of the Lake Vermilion Guides League. While he agreed that the park could bring more anglers and potential customers for fishing guides to the area, he said many guides remain concerned about protecting the pristine nature, and key spawning areas, of the lake’s east end.

At the same time, Skraba acknowledged that the new park would provide a boost to Ely’s economy. “As a former retail operator in Ely, I saw a lot of people from Bear Head [state park] come in and shop,” he said. “It definitely will benefit Ely.”

Assuming the Legislature agrees with the plan, the new state park could open to limited day use by mid-summer 2011, and could be fully operational by 2012, although State Park Director Courtland Nelson said timelines and the types of park amenities possible are dependent on funding. He said full development, including roads, campgrounds, trails, utilities, and a visitors center could cost $25-$30 million.

DNR officials had predicted two years ago that the park could attract 400,000 visitors annually, but Nelson said the actual number of visitors will be dependent on the degree of investment made in the park’s facilities. Nelson said the details of a development will be ironed out by 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.”

Legislature must still sign off

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. According to Holsten, the Legislature had permitted the DNR to pay no more than 12 percent above appraised value. Although Holsten said he was prevented from releasing the results of the state’s appraisal until a final deal is signed, it has been reported that the appraisal came in around $13 million. At the same time, US Steel’s own appraisal pegged the land’s value at $20.3 million, leaving a considerable gap for negotiators to bridge.

Local legislators say legislative approval is likely, but not automatic. “I think the challenge is that the governor has really been unwilling to give legislators anything that they want, so some people may be unwilling to give the governor language that he wants when he won’t do the same,” said Sen. Tom Bakk, DFL-Cook.

Rep. David Dill, DFL-Crane Lake, said he expects the governor will get his way in the end. “I have no doubt about it,” he added.

While Bakk remains a firm park supporter, Dill has mixed feelings, in part because he worries that the state won’t follow through on its commitment to develop the park. “The promise here is of things to come in the future. That’s a road that is fraught with all kinds of difficulties,” he said. “Where does the money come from to start to do the things that are promised?” Dill said he is also wary that visitation estimates are being exaggerated and that the loss of tax base will prove a bigger problem than anticipated. “This flies in the face of having just passed a huge school bonding bill. This tax capacity will be gone forever,” he said.

Rep. Tom Rukavina, DFL-Pike, has similar concerns, and thinks the state should use the $18 million in bonding authority to develop the land it already has in the Soudan Underground Mine State Park. “If you can develop the current acreage, for less, to me, that’s a wiser use of the money,” he said. “We don’t have the money to maintain our state parks as it is.”

Despite their concerns, area legislators acknowledge that the park would provide economic benefits to the Tower and Ely area. “It would be a big thing for both communities,” said Bakk. “I think if it’s done right, there is an opportunity for an incredible array of camping experiences. There is access to the Boundary Waters, remote camping on islands on Vermilion, and preferably an RV campground as well.” Bakk is also interested in the creation of a major new visitors center that could be jointly owned and managed by the DNR and the Minnesota Historical Society, as is currently done at the Split Rock Lighthouse. Bakk said a new visitors center could also become the repository of the historical collection currently housed at the now-shuttered Ironworld.

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.

US Steel officials had broken off talks over two years ago, saying they did not want park negotiations to interfere with their ongoing effort to permit expanded operations at the company’s Keewatin mining operation. According to the DNR’s Holsten, the agreement on the Lake Vermilion property provides no considerations other than the cash payment. “There have been no connections to the Keetac issue at all,” he said.


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The correspondent, Helmberger, states U.S. Steel officials, without naming his source, says there are no connections to the Keetac facility. Want to bet? Sorry Mr. Helmberger, some of us have lived here all our life, including Mr. Rukavina, and we know U.S. Steel NEVER enters into or agrees a agreement unless there is something greater to their benefit than the party they are dealing with. Call Tommy.

Saturday, January 23, 2010