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Serving Northern St. Louis County, Minnesota

Council approves purchase of county public works building

Marshall Helmberger
Posted 2/14/24

TOWER— It appears the city of Tower will be the next owner of the public works facility currently owned by St. Louis County. The city council here voted 3-0 here on Monday to authorize the …

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Council approves purchase of county public works building


TOWER— It appears the city of Tower will be the next owner of the public works facility currently owned by St. Louis County. The city council here voted 3-0 here on Monday to authorize the purchase of the facility, located on the city’s west end, for the appraised value of $260,000, plus any financing and legal expenses. Councilors Josh Zika and Bob Anderson were not in attendance.
The decision to purchase the facility began with informal discussion three years ago and was ultimately made possible by the county’s decision to consolidate its public works staff into a new facility built in Kugler Township last year.
An ad hoc committee of city officials had investigated the issue recently and recommended that the city purchase the 31-acre site, which includes a 3.6-acre parking lot, a 4,700-sq. ft. office and maintenance garage, a 3,500-sq. ft. cold storage building, and a 10,200-sq.ft. salt dome with thousands of yards of salted gravel. The maintenance facility includes a built-in crane and a long list of other equipment which the county plans to leave.
In authorizing the purchase, the council also directed clerk-treasurer Michael Schultz to begin the process for issuing general obligation bonds to finance the acquisition.
The council’s decision didn’t come without some skepticism voiced by council member Kevin Norby, who questioned whether the city, which has been working to recover from its financial crisis of several years, could afford the purchase. Norby said he agreed that the city was getting good value, but he wondered if it was truly needed. “We currently spend about 32 percent of our levy on debt,” he said.
But Mayor Dave Setterberg noted that the city will retire its debt to the League of Minnesota Cities when it makes its final $50,000 payment later this year. He said under the various bonding proposals, the city would not have to make payments on the facility purchase until next year at the earliest, when the LMC debt will disappear.
Setterberg and Schultz outlined several other benefits of the purchase, including the fuel tanks and dispensing system that the county plans to leave. “That means we can buy our fuel in bulk and get the state bid pricing for all city vehicles. That adds up to quite a bit.”
He noted, as well, that the city’s public works staff would now have the ability to undertake repairs of major equipment that they could not do in-house in the past due to the lack of a large enough facility and the equipment needed. Schultz noted that the purchase would allow the city to repurpose its existing public works buildings, which are scattered around the city and in varying states of repair and possibly generate revenue from the buildings by leasing for storage.
Setterberg said the city would also benefit from maintaining control of the site, which could prevent an unsightly commercial operation at the site that might clash with the planned residential development off the east side of Marina Drive.
Despite Norby’s concerns, he eventually agreed to the purchase. “I was going to vote no, but the more people I talked to, most people urged that we get it,” he said. “I vote yay,” he concluded. He was joined by Setterberg and council member Joe Morin, who was under the weather but attended to ensure the council had a quorum.
In other action, the council approved an updated ambulance donation agreement which was recently presented to the Tower Ambulance Commission for review by the participating local units of government. The new contract is seeking a $25 per capita payment from donating units of government, potentially including Breitung, Eagles Nest, Greenwood, Kugler, and Vermilion Lake townships. The agreement also requests donations of $6,500 from Fortune Bay and $3,500 from the Bois Forte band. If approved by all parties, the agreement would generate $75,925 this year, and each year through 2026 with the funds going to the ambulance replacement account. The agreement does not set any amount for payments from the Tower ambulance service to the ambulance replacement fund for transfer miles, a controversial charge assessed by the ambulance commission which has contributed to the ambulance service’s recent operating deficits.
In related action, the council authorized the transfer of $9,709.02 from the city’s Hoodoo Point Campground account to pay the transfer mileage fee through the year-end 2023.
The council also approved, after the fact, a recent transfer of $16,833.56 from the city’s general fund to cover the worker’s comp insurance, which had to be paid in November. All told, the city paid out $51,542 to cash flow 2023 ambulance expenses that could not be paid through ambulance revenues.
The council also authorized advertising for an assistant ambulance director after the recent resignation of Karen Schultz. Clerk-treasurer Schultz noted that Karen Schultz was involved with the Cook ambulance service as well and said she was increasingly busy with her duties there. Norby requested an exit interview be done.
In other business, the council:
• Directed the clerk-treasurer to continue exploring options for addressing the sunken floor at the historic train depot. Schultz said an initial examination found that a major beam under the depot had broken and may need to be repaired or replaced. An initial quote came in at around $25,000, which is more than the city was hoping to pay for repairs. Schultz noted that the city still needs to address an issue with water runoff from the depot, which may have contributed to the problem. “If we fix it without resolving the water issues, it will just be a band-aid,” he said.
• Named the Timberjay the official newspaper for 2024. The only other sealed bid received, from the Tower News, was received three days after the bid deadline and could not be considered according to city attorney Mitch Brunfelt.
• Gave the first reading of a minor change to the city zoning ordinance, No. 82, to make single family dwellings an allowable use in the Harbor North zone district.
• Declined to accept a $2,000/year lease amount from Midco for the tower it owns on the hill on the city’s north side. The city had sought $4,000 a year, plus an annual escalator, but Midco had rejected that proposal and had suggested that the city assume ownership of the tower. The council was cool to that suggestion and directed Schultz to contact American Tower, which owns the other tower on the hill to see if they might be interested in assuming ownership.
• Authorized Schultz to apply for grant funding from Iron Range Resources and Rehabilitation for various projects, with repairs to a S. Second and S. Third sewer line as the top priority, with the depot as second on the list. Benchmark has been undertaking engineering for the sewer line project and would undertake project management for a nine percent fee, significantly less than the city has traditionally been charged by SEH.
• Authorized the purchase of a new outdoor bathroom facility near the civic center from Green Flush.
• Undertook a brief recap of the Pine Street reconstruction project, and approved the final pay estimate of $49,979.35 for the project. State and federal grants paid for much of the work, but some of the early engineering costs were not covered by the grant funds, which left the city to cover a total $221,108 of the project’s cost, or about 20 percent of the $1.007 million spent on the project.