Serving Northern St. Louis County, Minnesota

EDITORIAL: Common sense wins out

Three city councilors wisely bucked an effort to kill harbor town home project

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A majority of the Tower City Council made the right call on Monday by derailing a transparent effort by Mayor Josh Carlson and City Clerk-Treasurer Linda Keith to scuttle the planned town home project that has been the focus of the city’s development efforts for nearly three years.

Had the mayor and city clerk had their way, the city would be faced with a potential lawsuit and virtually no prospect of attracting a new developer to the harbor. It would have been a disaster, and it was one that councilors Lance Dougherty, Brad Matich, and Brooke Anderson were wise to avoid.

There’s no way to know for sure at this point whether the town home project will prove a success, but there’s no rational basis for quitting at this point, after both the city and the developer have sunk hundreds of thousands of dollars into advancing the project. With St. Louis County likely to grant final plat approval in December, the developers will finally be able to begin to convert perceived interest in town homes into signed purchase agreements. After nearly three years of good faith efforts by the developers to advance the project (despite the city’s constant shifting of the goal posts), city officials would be reckless, and potentially legally liable, for pulling the rug out from under the project now.

The effort to derail the town home project was plainly choreographed by the mayor and city clerk, with the city clerk claiming that the attorney advising them on the project had determined that the tax abatement proposal approved by the council two weeks earlier violated state law. Councilors Dougherty and Matich were the first to ask to see something in writing, particularly as town home master developer Jeremy Schoenfelder challenged Keith’s interpretation.

Dougherty has increasingly complained in recent weeks that the council is being asked to make decisions without adequate information, which has been a continuing problem under the current mayor and city clerk. Matich suggested the council, in this case, was being “railroaded.”

Further examination of the issue by attorneys for both sides should clarify the issue. But until that happens, it would have been reckless for the council to let themselves be coerced into a hasty decision.

That’s exactly what the mayor and clerk were trying to do. Indeed, Clerk Keith, no doubt with Carlson’s support, had added an agenda item for later in the meeting under which they hoped to get the council to issue a new Request for Proposals for harbor development. It was a jaw-dropping example of the degree to which city hall has lost touch with reality. Fortunately, given the council majority’s refusal to go along, the RFP gambit was quickly shelved.

Had the mayor and city clerk had their way on Monday, no developer in their right mind would touch the city’s harbor with a ten-foot pole. Remember, it was the mayor, the city clerk, and harbor committee chair Steve Altenburg who developed the plan for town homes at the harbor. In late 2015, they requested proposals for architectural, design, marketing, and construction services to assist in a town home project in which the city would serve as developer. Then, after attracting interest from a group led at the time by Orlyn Kringstad, the city changed course and asked Kringstad’s group to become the lead developer, which increased the risk to Kringstad’s company and investors. Under that deal, the city agreed to finance the cost of public infrastructure. Earlier this year, the city changed its mind again, reneging on the commitment to fund infrastructure, putting the risk of that investment on the developers instead.

Most developers would have recognized the city as an unreliable partner at that point, but having already invested more than $300,000 in the project, the developers had an awful lot at stake in seeing the project through. In the end, they worked out a way to finance the public infrastructure with private dollars, to be repaid through the tax abatement plan.

The city council unanimously agreed to a modified tax abatement plan at their Nov. 13 meeting, Then, less than two weeks later, the mayor and clerk were pushing the council to renege on yet another agreement without a clear explanation.

Given such a track record, how could any developer rationally view the city, at least under current leadership, as a trustworthy partner?

Fortunately, three councilors had the good sense to seek clarification of the legal questions and take more time to make a sound decision. Hopefully, the council majority will take the steps necessary to hand a viable project off to the incoming administration. To destroy the project at this point would be an awful legacy for the outgoing mayor and councilors to leave.

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