City Council

Posted November 7, 2012 at 12:44 pm

Council can’t agree on property sale

By Kim Brooks, Express Editor

After a public hearing and action on a resolution regarding the sale of property by the city along E. Oak Street and the related contract during the Oct. 15 Monticello City Council meeting, the resolution was placed back on the agenda for the Nov. 5 meeting, at Mayor Dena Himes’ request.

At the last consideration, the vote failed on the sale of this property. Himes explained she wanted the Council to reconsider the resolution because those associated with the property (the Monticello Development Corporation and developers Mike Beck and Mike Kraus) were not able to attend the last meeting. They were present at this Council meeting to answer any questions the Council or Mayor had and to further discuss the issue.

Kraus and Beck agreed to buy the two properties along Oak Street for $75,000. A proposed agreement has also been discussed with numerous terms.

Council members Bill Meyer and Dave Goedken were opposed to this resolution appearing on the agenda again, as it was already voted down. City Administrator Doug Herman informed the Council that they could make a motion and second to vote down the reconsideration, or move forward with the sale under different terms and conditions than were proposed in the first resolution.

Goedken asked why the developers needed to purchase two homes to establish a private driveway into the subdivision. Beck explained that by just purchasing and demolishing one house, the grade of the land would be too high to develop a private drive. He said the grade of the land needs to be cut down 4 or 5 feet, “and we need two houses to do that.”

Goedken also had an issue on the city financing the project.

Council member Tom Yeoman said he understands the cost of developing an area such as this. He said he also sees where other Council members are coming from, not wanting the city to be in the banking business of loaning out money for development.

“But we’re in this situation now,” said Yeoman. “These developers want to increase our tax base by $2 million at 3 percent interest versus what they’d get at a bank. It’s a win-win situation to do it.”

Meyer said he is in favor of selling these properties to the developers, but was firm that he would not vote for the sale again because it was brought back up on the agenda after a failed vote the last time.

“It was voted down and now it’s back on the table again,” Meyer said. Meyer also commented the city “should never be in the real estate business.”

Council members Chris Lux and Reenie Breyer made a motion and second to approve the property sale as stated. The motion failed by a vote of 3-3 with Council members Meyer, Goedken and John Sauser opposing.

Sauser commented that he wanted to see the city out of the deal as soon as possible, not five years or so down the road.

“This is a unique situation we’re in,” commented Herman. “This is all the property the city has to sell.”

With the failed vote, the city essentially is still maintaining ownership of the Oak Street properties.

“We’re sitting here owning property that we are trying to get out of,” said Lux.

Gerald Retzlaff with the Monticello Development Corp. told the Council that they are trying to work with them on this deal to benefit the city.

Herman said the Council could revote on a changed resolution, providing Beck and Kraus were in favor. The Council proposed changing the down payment price from $15,000 to $20,000, of which Beck said he would be in favor of, but could not speak for Kraus. Goedken made the motion on the changed resolution; Meyer seconded the motion. The motion passed by a vote of 5-1 with Sauser opposing.