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Serving Northern St. Louis County, Minnesota

Community Center just about sold

Ordinance OK’d by council, 6-1

Keith Vandervort
Posted 10/3/18

ELY – The city council here voted 6-1 Tuesday night to accept the first reading of an ordinance authorizing the sale of the Community Center to the K America Foundation for $30,000, bringing the …

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Community Center just about sold

Ordinance OK’d by council, 6-1

Posted

ELY – The city council here voted 6-1 Tuesday night to accept the first reading of an ordinance authorizing the sale of the Community Center to the K America Foundation for $30,000, bringing the city one step closer to seeing the vacant building renovated and returned to the property tax rolls.

Council member Paul Kess reiterated his opposition to the sale of the property to the K America Foundation. “Their business plan doesn’t show enough financial strength, and the purchaser might not be able to accomplish what they say they want to accomplish. Because of that, I would vote no. To me, it is like selling a house and hoping the purchaser can get a mortgage. I need more financial assurances.”

Council member Jerome Debeltz, who also voted against signing the purchase agreement with the K America Foundation, said he had concerns that the city would only get half of the $30,000 offered for the building. “We have to remove the fuel tank and that will likely cost more than we’re getting for the building,” he said. “But we might as well move on with it.”

Mayor Chuck Novak said he is in favor of the sale. “The building has sat idle far too long,” he said. “Our broker has had several people bring inquiries on the building, and this is the first reasonable offer. I understand that nobody is walking in with a bag of candy. I also understand that we have to dispose of this agreement before we can proceed with any further offers to avoid being sued.”

Novak also said he was concerned with the length of time the building has been vacant. The landmark Community Center was essentially mothballed four years ago when the city built its new library. “If that building sits idle for another three or four years and is unheated, then it will take a wrecking ball. Unheated sections of that building are already starting to show some issues. We need to alleviate that as fast as possible,” he said.

The city of Ely is obligated to remove the fuel tank from the building prior to any sale. There may be 6,000 to 7,000 gallons of fuel remaining in the tanks, according to Clerk-Treasurer Harold Langowski. “Any prospective buyer will have to provide their own heating source,” he said.

Just one tank removal bid, in excess of $25,000, was received and rejected by the council last month. “We will try to rebid this in the spring and hopefully get a better price,” Langowski said.

Council member Al Forsman said the K America Foundation bid for the building was the “only viable business plan” for the property. “As a city council it is our decree that city property is secured and used in the best way possible,” he said. “The building can still be used for the benefit of the city and I believe in the business plan put forward by the K America Foundation.”

Council members Heidi Omerza, Dan Forsman and Ryan Callen all indicated support for the sale of the building to the K America Foundation.

City Planning and Zoning Committee members were set to approve a rezoning of the property following a public hearing Wednesday night. The city council is expected to finalize the sale following a second reading of the ordinance at their regular meeting on Oct. 16.

Other business

In other business, the city council:

Authorized the Ely High School Homecoming Parade to be held on city streets on Friday, Oct 12, beginning at 4 p.m.;

Accepted the 2017 city audit as presented by Greg Knutson of Walker, Giroux and Hahne;

Authorized the filming of the Thanksgathering event at Ledgerock Church;

Approved the purchase of a video camera, as recommended by the Telecommunication Advisor Board, for $4,029;

OK’d the recommendation from the Park and Rec Board to increase by $25 the half-day fee for non-profit organizations for the use of the Rec Center;

Approved the recommendation from the Park and Rec Board to not issue refunds for the Tuesdays in September when there was no Farmers Market event;

Approved payment of $282 lighting rebate to Gerzin’s Wood Wizards;

Approved a note and mortgage for Doug Scheibe for a Residential Rehab Loan for $7,000;

Passed a resolution authorizing property tax assessments for unpaid utility bills;

Changed the time and place of the council study session to 4 p.m. on Tuesday, Oct. 30 at Amici’s Event Center for the Ely Area Broadband Coalition meeting;

Approved a commercial renovation loan for East Sheridan Properties to repair the roof and insulation at Insula Restaurant;

Passed a resolution appointing election judges for the 2018 General Election;

Scheduled a Truth in Taxation public hearing for Tuesday, Nov. 27 at 6 p.m.