NEW ULM - The Council tabled the proposal to lease the City's compost and burn site to M.R. Paving & Excavating on Tuesday to allow further clarification of details on how the site will be run.
The proposed lease to have M.R. Paving run the site will last five years. The City will save up to $28,000 to $30,000 each year for the cost of employees to run the site and the City's discontinued practice of filtering the compost, which has not been done in recent years due budget constraints. M.R. Paving will start by paying a $5,500 rent to the City for the site, which will increase 3 percent from the last year's rent during each year of the lease. M.R Paving will run the compost site and will take over the burn site for wood. The wood would be turned into chips because M.R. Paving not having the same burn license the City has through the DNR.
M.R Paving will be obligated to go through the rezoning process if it wishes to sell its products at the site. It will also be responsible for following regulation on trash and water runoff. It will be responsible to pay any resulting taxes if its operations is determined to change the tax exempt status on the land.
The City will take responsibility for holding public awareness meetings to inform residents about the change when the lease agreement eventually proceeds.
The Council's decision to modify certain elements of lease presented on Tuesday was due to concerns councilors had about the changes in services.
Councilor Ruth Ann Webster said her biggest concern is obligating M.R. Paving to accept all the types of compost the City currently accepts and to have the site open approximately the same hours as the City currently offers. She said the lease requires the M.R. Paving to accept all the currently accepted types of trimming, but it appears the wording was not the same with the last minute addition of having M.R. Paving take over the wood material. Councilor Les Schultz said his discussion with plans for the site seemed to indicate M.R. Paving's initial plan was longer than current City hours during the work week, but shorter on Saturdays. He said his concern is most of the residents use the compost site on the weekend.
A representative of M.R. Paving said it had selected hours with Saturdays only being open until around 3 p.m. based on preliminary examination of how other cities ran their hours. He said the hours were only demonstrative and not set in stone.
The other big point of discussion was concern by Councilor Ken RockVam over what M.R. Paving would charge for the compost, especially given that the City currently provides it for free. M.R. Paving has not yet settled on a price.
RockVam suggested having a one-year trial period for the lease to allow options if the compost became too high prices. City Manager Brian Gramentz said the lease being presented was set for five years to be long enough to allow M.R. Paving to be able to make back its investments.
Street Department Commissioner Tom Patterson said he thought there might be complaints no matter what action the City takes. He said that after the City discontinued sorting the compost due to cost of the process, his department got endless complaints about the lower quality of the compost despite it being free. He also noted that his department saw the majority of the compost taken by area contractors and businesses in larger amounts, far more than any amount taken by individuals.
RockVam said he ultimately accepted the five-year contract given M.R. Paving's need for time to work on the project. He said his hope is the price will be self-regulating, because if the compost is too expensive, buyers would resist and the process would end up costing M.R. Paving.
The Council ended the discussion by directing City staff to redraft the lease to require M.R. Paving to accept wood brought to the site under the same criteria the City currently has and to make considerations for the City's current operating hours. The revised lease will be discussed at an upcoming Council meeting.
Marktplatz Mall Sign
In other business, the council decided it will pursue litigation to determine if any remaining third party interest remains in the Marktplatz Mall sign, freeing up the City to either proceed with the sale of the sign or to step the process to avoid costly litigation. The move was authorized by the New Ulm City Council on Tuesday night during its regular meeting.
The City has argued that a failure to renew the lease on the sign by either of the two owning entities of the mall meant their claim to it has been forfeited. However, because south side owner Randy Danielson has challenged the City's claim, City staff has advised the Council to seek litigation to have an official ruling if any other ownership interest still remains in the sign.
Former mall owner Bob Petroff, who drew up the original lease agreement with the City for the sign, and New Ulm Retail and Development, LLC., the current owning entity of the northern two-thirds of the mall, have publicly said they have no interest in the sign.
(Josh Moniz can be e-mailed at firstname.lastname@example.org)