Posted: 7/18/07
Rush Landing streets causes clash between residents and council
 Rush Landing resident Todd Sempel |
By Patrick Tepoorten
Tensions boiled over in Rush City last week as the desire of homeowners to have their road completed clashed with the city's desire to find an equitable way to finance the $125,000 project.
The issue of deteriorating roads in the Rush Landing development goes back to 2001, when the developer, Land Holding Group, declared bankruptcy before the roads could be completed. At the time, there were still soft spots to be addressed and only a first lift of blacktop as a surface. Since the road was never completed it was never accepted by the city and, therefore, no maintenance has been done to the half-finished road since.
If a primary cause of the unfinished road is the developer's financial problems, another is the city's lack of attention to the project. For instance, a letter of credit for the project in the amount of $50,000 was discovered in the safe by city staff, but the letter had already expired and was unusable to help finance necessary improvements.
The roads were brought to the forefront last July, when residents of Rush Landing requested the city complete the roads. At the time, the previous council agreed to look into it, and former mayor Mike Skalsky indicated strongly that, due to the city's errors in dealing with the developer, the project would be completed entirely at the city's expense.
"The city has no plans to assess for this project," said Skalsky at the time. "It wouldn't be right."
But, shortly after the new council and mayor took office, Mayor Jim Ertz instructed city engineer Barry Peters to look into the impact of having affected residents pay for 25 percent of the project through assessments. The primary reason for that request was the city's inability to finance the project completely without first passing a referendum to that affect.
A public hearing last Tuesday, July 10, was the first opportunity for Rush Landing residents to weigh in on the option of assessments, and roughly 50 showed up to voice, primarily, opposition.
Peters explained that the city would finance 75 percent of the project and that assessments would range from $460 to $655 depending on how assessments were distributed. Northland Securities' Paul Donna added that state law requires assessments of 25 percent or greater in order to bond for a project without the approval of the entire city in the form of a referendum.
But anger over perceived promises and the way the development was handled by the city were very much on the minds of those in attendance.
Resident Steve LaMont said he has been paying taxes for completed roads since he moved in four years ago and wondered where his money has been going if not to maintain his roads. He also was unhappy with the $50,000 letter of credit being allowed to expire. "The city dropped the ball," he said.
Another resident, Dick Brady, who lives along one of the private streets that the city will not repair because they were never intended as city streets, said, "I would move out of Rush City in the morning if I could."
The city is not able to discuss the future of the private roads because of current litigation brought by the homeowner's association. At issue is a deed for the roads from the developer to the city, which the city contends it never accepted and was changed in the final plat at the last minute without the city's knowledge.
Resident Deb Buerkle wanted to know if the $50,000 line of credit would have been enough to pay for the road completion.
"At the time it probably would have," responded Peters.
"It's the council's fault that they let that drop," said Buerkle, who then asked, "How do we have faith in the council when they said assessments wouldn't happen. Now we have a new council and here we are?"
"My vote has not changed," responded councilor Mick Louzek, a member of the previous council, "the council has."
Ertz noted that he agreed with the residents, but he did not feel a referendum was realistic. "We can try, but I can guess the outcome," he said, adding that most people would likely not vote to pave someone else's streets. "But if we assess 25 percent, we can get it done. We'll take 75 percent of the blame."
Another resident, Todd Sempel, asked if the city knew about Land Holding's bankruptcy before or after the letter of credit expired. City administrator - city clerk at the time - Amy Mell said she did not know, and apologized for the way it was handled by the city.
Sempel also took issue with what he felt was inattention by the city to the problem. "If we wouldn't have stepped up last fall, the roads would still be the same way," he said. (After last year's meetings, some streetsweeping was done and some potholes filled.) "I think the city should have been responsible and done it earlier, the roads wouldn't have been as bad," he added, and suggested that the council had to be forced to act.
Mell reminded residents that, as the roads were never accepted by the city, the city is under no obligation to complete the project at all.
Applause greeted Ron Buerkle when he noted the unfairness of the fact that, whether the roads were accepted or not, he and others in the development have been paying taxes as if the roads were finished.
"The council doesn't disagree with that," replied Ertz.
Resident Kelly Martfeld, trying to move past assigning blame said "We're going to get hosed, we all know that. How is it going to be assessed. Will it all be the same?"
Peters responded that it would be.
"You're telling us that you'll pay 75 percent. Fine, I'm sick of living on ghetto streets. But the city dropped the ball and I don't want to see it happen again."
Another resident, Steve Leite, said it was time to move on. "We're between a rock and a hard spot. You are, we are. So let's quit beating a dead horse and accept that we have to pay for it."
When it was explained to Leite that the assessments could be paid over 10 years, with roughly 5 percent interest, Leite responded, "I can live with that. I just want to see something done out there."
The concern was raised that the council could change its mind again after the meeting, and increase the assessment. City attorney Joe Anderson responded that in the context of a feasibility study, the council gives a maximum figure and would not be allowed to raise it later.
Resident Kelly Dusek was concerned about maintenance after the road was completed. Peters responded that, once the project was completed and accepted by the city, it would then be responsible for all maintenance and improvements. He also said that the newly completed road would have a 20-year life expectancy.
The council voted to move forward with the project with a 25 percent assessment, and hopes to tie it to the Jay Ave. project later this summer, which puts some urgency on getting the details worked out. In the meantime, residents asked if the city could sweep and fill some potholes, which the council agreed to look into.
Before everyone went home, Ertz and Louzek addressed the crowd.
"This council is on your side. We want it done and done right. But we needed to put this together in such a way as to make everyone as happy as possible," said Ertz. "We have to deal with the other 700 families out there. It's not a plan everybody likes but it's win/win if we can get in there and get it done now. We're looking at the mistakes of the past several years now," he stated before adding, "I can't resurrect a bankrupt developer."
"I was on the old council and we trusted people," added Louzek. "I don't trust a single developer anymore and that's a shame. That generation is gone."
©ECM Post Review
6448 Main Street
North Branch, MN 55056
Telephone: 651-674-7025
Fax: 651-674-7026
E-mail: editor.postreview@ecm-inc.com