Monthly Archives: December 2005

Park Board Settles Lawsuit, Loses $900,000 at Ft. Snelling

On Wednesday, December 7, the Park Board voted to approve the negotiated settlement of a $1.8 million lawsuit filed against the Park Board by contractors who did work at the 201 Building at Ft. Snelling. The settlement requires the Park Board pay $900,000 to the plaintiffs. The lawsuit arose out of work performed but not paid for in a failed attempt to build a skatepark at Ft. Snelling.

The settlement was commented on by a number of writers to the Minneapolis Issues List:

Katie Simon-Dastych asks: “Where will the $900,000 come from?” (as posted on list)

Rick Kuhlman asks: “What in the heck are they going to do with the 201 building now? I drove by it this morning. It was all boarded up.” (list)

Ken Bradley answers: “Like all cases the government settles and the tax-payer pays the bill through higher taxes.” (list)

Park Board Commissioner Annie Young replies: “The Park Board has until Nov. 1, 2006 to settle this claim. In the meantime, we will be trying to sell the building or come up with the revenue from the building in one way or another that would get us this $900,000. By about next June we will be looking at all our options which as a last resort includes paying out of our self-insurance fund by the Nov. 1 deadline.” (list)

Shawne FitzGerald details the history of the $14.9 million and growing public expense at Ft. Snelling (list):

» The MPRB bought the 201 Building at Ft. Snelling Neiman intending to build a practice ice facility for the Minnesota Wild hockey team. MPRB staff was negotiating with MN Wild at the time – the purchase was made before the deal was finalized. The vision was that the facility would generate revenue for the MPRB. The cost of the building was $850,000. The MPRB hired Miller Dunwiddie to estimate the cost to rehab the building to an ice facility – that estimate was about $3.5 million. The MPRB moved a road and built a very nice parking lot, wired for lots of lights, adjacent to the building. The deal with the MN Wild did not happen – and the MPRB investment at the 201 building was over $1 million. The source of funds was bonds.

Next, the MPRB granted The Fort LLC a 30 year lease to develop and operate an indoor/outdoor skatepark at the 201 Building. There was no rfp for the project – no bids were taken. (The agreement also contained a no-bid contract to construct two skateparks elsewhere in the system.) This project was also supposed to make money for the MPRB. The Fort LLC abandoned the project leaving the contractors unpaid. The contractors filed liens against parkland and filed a lawsuit – this $900,000 is the proposed settlement of that lawsuit. The MPRB needs to sell this site for about $2 million just to break even! The alternative is to spend millions of dollars to rehab the 201 Building – a building that seems to serve no MPRB need – so selling at a loss to raise money to settle the lawsuit is an option worth considering.

Comm. Young suggests that, worst case, the $900,000 will be paid out of the MPRB self insurance fund. At the end of 2004, the balance of the self insurance fund was ($3,506,366). A negative number. I humbly suggest that the self insurance funds have to come from some source – and property taxes remains the MPRB’s largest and most reliable source of income.

The MPRB is on the hook for the $900,000 because it failed to require a performance and payment bond or any other surety from the developer. Requiring contract bonds is standard within government; MPRB staff have routinely done this for years. In a sense, requiring contract bonds is another element of community review – in this case, a specialized financial review, for developers demonstrate that they have the requisite financing, credit, suppliers, and experience to complete a project. Probably, The Fort LLC, a newly formed company with no development, construction, or skatepark operating experience and with no assets, would have been unable to secure contract bonds for the project. Personally, I believe that one or more folks at the MPRB did this developer a big favor and now, taxpayers are going to pay for that favor. Will those responsible be held accountable?

I’ve read almost all of the MPRB Board meeting minutes back through the 4th quarter of 2001. There is no mention of citizen advisory committees formed to review either the ice facility or skatepark facility at Ft. Snelling Neiman. I can’t recall a public hearing for either use.

The MN Wild do practice at the MPRB Parade Ice Complex. In 2004, when there was a hockey strike, the Parade Ice Complex lost $230,193.

Other Ft. Snelling Neiman Facts:

  • When the Ft. Snelling athletic complex began, initial project costs were $6,000,000 (ca. 2000). The project costs escalated to $14 million in 2001 and $14.9 million in 2005.
  • Taxpayers are paying for Ft. Snelling Neiman. Debt service on the $14 million bonds sold for the project is just over a million annually. Additionally, the park operates at a loss – this is projected to be $40,000-$45,000 in 2006. The annual cost of Ft. Snelling Neiman will be about $1.1 million. (The MPRB annual operating budget is about $50 million.)
  • A $1 surcharge on golf rounds doesn’t generate enough money to pay for Ft. Snelling Neiman. In 2004, about 280,000 rounds of golf were played at MPRB courses.
  • In 2001 when the MPRB requested the $8 million in additional bonds for Ft. Snelling, the staff recommendation said “At this point, our bonding request will be for enterprise fund supported bonding of $6 million dollars. An additional $2 million in bonding supported by external funding (such as the Minnesota Wild rent) will be finalized over the next 12 weeks.” The park operating enterprise fund consists of “golf courses, refectories, ice arenas, sports complexes and self-supporting recreational activities.” In 2004, these activities generated a net profit of $334,959.
  • The Ft. Snelling Neiman project was unusual in that it was the first time the MPRB decided to finance a new project with bonds independent of the CLIC process. (I think this is the right way to state this – David Brauer can correct me.) So, another mechanism of community review was lost. The next time the MPRB tried the same strategy, borrowing for the new Headquarters Building, the Mayor vetoed the request with City Council support.
  • Initially, the MPRB sold $6 million in bonds (through the City) for the athletic complex, the fields, at Ft. Snelling. Early on, the MPRB diverted the majority of funds, $4.1 million, to acquire land adjacent to the Ft. Snelling athletic fields that was leased to a new private corporation for 30 years. The private corporation built an indoor tennis facility on the parkland. At the end of 30 years, the corporation has pledged to donate the facility to the MPRB. To be fair, this is a non-profit corporation. Again, there is no record of a citizen’s advisory committee formed to consider whether or not the MPRB needed to borrow and spend $4.1 million on a $9 million tennis facility located outside of the city in return for getting a 30 year old building and use of it’s own land 30 years down the line.

    Another problem with the tennis facility is duplication of services. The MPRB has had a longtime relationship with another tennis non-profit, Inner City Tennis, based at 40th and Nicollet. Did the MPRB need a 2nd facility, another tennis/mentoring program? If yes, why are there two southside and none northside or eastside? These nonprofits use not only MPRB resources but they compete against each other for grants and with the current MPRB strategy to seek more grants, we need to ask how many grants will be given for youth athletics? For what sports or other recreational activities?

  • In 1998, Supt. Fisher estimated that quality athletic complexes could be built at Bryn Mawr, Ft. Snelling, and Northeast Park for $18 million. The MPRB’s goals were 1) to increase soccer fields, 2) to provide quality fields, and 3) to provide more rec opportunities especially for middle school students to divert them from gangs. Although the field improvements at Ft. Snelling cost about $7 million, total project cost is $14.9 million.

Shawne FitzGerald «

All of this expense could have been easily avoided by the commonly used instrument of a performance bond. Park Board attorney Brian Rice claims he never saw the contract between the Park Board and The Fort LLC. Why not? Does anyone write a multi-million dollar contract and 30-year lease without consulting a lawyer? Of course not. So why was the Park Board’s contract with The Fort LLC not reviewed by Brian Rice? Why was there no performance bond protecting the taxpayers from the private entity’s failure to perform?

Star Tribune: City Council Accepts DeLaSalle Environmental Assessment Worksheet

Rochelle Olson writes in a sloppy article about the city council approval of the Environmental Assessment Worksheet (EAW) completed by city planning staff as ordered for the DeLaSalle-proposed Stadium project:

The prospects of a new football field on historic Nicollet Island became muddier Friday, even as the Minneapolis City Council gave approval to an environmental impact statement from the city.

Despite misgivings, the council voted 9 to 2 to move the football field proposal back to the park board. But the council has many more opportunities to stop it.

Council Zoning and Planning Committee Chairman Gary Schiff said ominously of the plan: DeLaSalle is “going to need all these historic approvals and we can just reject them.”

The entire article can be read here on the Star Tribune website.

Yes, there is an error in the second headline and in the story: the council approved an Environmental Assessment Worksheet (EAW), not a more thorough Environmental Impact Statement (EIS). The council members were deciding whether to order an EIS; they were not approving an EIS. One of the main requests in the 45 written comments from individuals and organizations was for the city to ask for research into alternatives, either in an EIS or during a delay before approving the EAW. Many readers know the difference and will get the wrong impression from the article.

Another error in the article is that the Park Board did not send the plan to the city for environmental review. Friends of the Riverfront successfully petitioned the state for the EAW. The state determined that the City of Minneapolis should do the EAW, and the city council decided the EAW was the mandatory rather than voluntary kind, due to the impact on historic resources (Grove Street). The Park Board had nothing to do with any of that.

The Park Board’s only direct involvment with the EAW was that the Park Board was barred by law from taking permanent action on the project until the EAW process was complete. It’s possible the reporter knows this but simplifies or dramatizes city processes with phrases like “the council voted 9 to 2 to move the football field proposal back to the park board” when of course the actual council vote didn’t say anything about moving it directly back to the park board.

Another flaw in the story is that it does not say why “DeLaSalle is seeking permission from the Minneapolis Park and Recreation Board to build the field.” The Star Tribune never fails to mention that DeLaSalle is 106 years old, but consistently fails to mention that the school wants to build the field on public park land.

Even with those errors, this article was more fair than some have been to advocates for keeping public parkland public on Nicollet Island. There were no phrases like “exclusive neighborhood,” and the story emphasizes the potential roadblocks that remain for the stadium, and casts the project as being in trouble much more than we’re used to hearing, with words like “muddier,” “misgivings,” “ominously,” and “tough time.”

Downtown Journal: Park Board Delays Sale of Fuji Ya

In an article titled “Breaking the Wave? Park Board delays completing sale for riverfront condo” writer Sarah McKenzie describes how the Park Board has delayed sale of the Fuji Ya property after earlier approving a contract for its sale and spending money on the lobbying effort to get a special state law passed to allow the sale to go forward.

» The Wave, a high-end condo project slated for Downtown’s riverfront, is encountering some choppy waters.

The Minneapolis Park and Recreation Board has put the project in a holding pattern, tabling a motion to finalize the sale of the former Fuji-Ya restaurant site, which it owns, to Heritage Development, a developer based in Little Canada.

Despite signing off on a purchase agreement in February to sell the prime riverfront parcel to Heritage for $2.7 million, the Board voted to hold off completing the sale at its Dec. 7 meeting. In order to finalize the sale, the Board needs to direct its attorney to file with Hennepin County District Court.

Park Board President Jon Olson said Commissioners plan to hold another public hearing on the sale of the Fuji-Ya site in January. The site is in front of the River West condos, near the corner of South 1st Street and 5th Avenue South, southeast of the 3rd Avenue Bridge.

The Mill Ruins Park is nearby, tucked along the riverfront near the Stone Arch Bridge.

In addition to the standard city review process, The Wave would be subject to approval from the Minneapolis Heritage Preservation Commission since the site falls within the St. Anthony Falls Historic District.

The developers behind The Wave are waiting for the sale to go through before going through the city’s development approval process. Michael Moriarty, president of Heritage Development, did not return a phone call for comment.

The January hearing gives opponents of the sale another opportunity to state their case.

Park Board Commissioner Bob Fine … said under the current arrangement, the Park Board doesn’t stand to gain much from the sale.

“I think we’re better off keeping the land,” Fine said. “The Wave is still waving.”

Under the proposal, the Wave would feature 36 high-end condos and a restaurant in a refurbished Fuji-Ya space. At its highest point, it would rise 11 stories.

The developer would set aside parking and public restrooms for park users, Olson said.

Heritage has teamed up with Jeff Arundel, a local rock musician, on the project. Arundel had the high bid for the site when the Park Board issued a request for proposals.

The Park Board acquired the Fuji Ya site in the 1980s as part of the West River Road expansion. «

Read original article at the Downtown Journal web site.

Park Board Meeting Dec. 21

* 4:00 – 5:00pm
— Reception for out-going commissioners: John Erwin, Vivian Mason, Rochelle Berry Graves and Marie Hauser

* 5:00pm Regular board meeting
— Reports of Officers
— Consent business
— Report from Planning Committee, approve off-road cycling on designated trails
— Unfinished Business
— New Business
— Recognition of out-going commissioners
— Petitions and Communications

* 5:45pm Recreation Committee
— 1 item, an award presentation

* 6:05pm Administration and Finance Committee

City Zoning & Planning Considers DeLaSalle EAW

Meeting starts at 9:30am, but DeLaSalle EAW is #21 on the agenda.

Committee Members: Council Members Schiff, Zimmermann, Goodman, Lilligren, Niziolek, Ostrow (quorum 4)
Council Committee Coordinator: Irene Kasper (612) 673-2219

More information here:

DeLaSalle EAW Document from City Planning Staff

Have you seen the city’s Findings of Fact document for
the DeLaSalle EAW? There is a very odd attachment
concerning a supposed city process for examining
alternatives that took place during the CAC. It
contains some Powerpoint-type slide print outs that
may or may not have been shown at the CAC. There are
also some pages of text that no one on the CAC
remembers seeing before. They are presented as if they
are the result of a thorough “city” public process,
when of course they are 100% pure DeLaSalle product,
with no public input whatsoever. The most hilarious
part is one of the pages actually states in print that
the CAC process is not the appropriate venue for
considering alternatives.

The city zoning and planning committee takes up the
EAW tomorrow (Thursday, December 15) at a meeting that starts at 9:30a.m. (but DeLaSalle is item No. 21 on the agenda).

The DeLaSalle material is at:

Budget Approval Meeting

The Park Board is scheduled to vote on adoption of the budget Dec. 19 at City Hall. The proposed budget can be viewed at or by calling 230-6400.

Time of meeting and vote is unknown at present.

The Park Board has proposed a $53.35 million budget, which includes a 4 percent property tax increase and almost $1.6 million in state aid.

Downtown Journal: Park Service criticizes DeLaSalle field plan

Reporter Sarah McKenzie writes:

» The National Park Service has criticized the proposed DeLaSalle High School athletic complex for being inconsistent with federal guidelines designed to protect Nicollet Island’s historic resources.

The Park Service argued that the high school doesn’t need a riverfront location for its new complex, that it would be inconsistent with “quiet and passive” established uses on the island and that it would contrast with the 50-acre island’s residential area.

The Nov. 23 letter sent to Senior Michael Orange also argues the high school’s plan would go against park policy advocating for open space and the preservation of the riverfront.

“Resting at the tip of the St. Anthony Falls area is a National Register of Historic Places District,” wrote JoAnn Kyral, superintendent for the Mississippi National River and Recreation Area, a National Park Service unit.

Kyral also criticized plans to vacate a portion of Grove Street. “Grove Street is one of the physical anchors that define the historic setting of Nicollet Island,” she wrote.

The letter, submitted as a comment for the city’s Environmental Assessment Worksheet (EAW), buoys opponents of the proposed facility like Barry Clegg, an island resident and member of a Minneapolis Park and Recreation Board committee reviewing the proposed design.

“I don’t think at this point that any of those concerns have been addressed in the planned design, and many of them are incapable of being addressed in the planned design,” Clegg said.

The Park Board approved the proposed layout of the athletic complex Oct. 19 and has been in a holding pattern since waiting for the completion of the EAW.

The 30-day comment period ended Nov. 23 and the planning staff members are expected to present the EAW to the city’s Zoning and Planning Committee on Dec. 15, Orange said.

Before the Park Board can give final approval to the complex, they must wait for the city to sign off on the EAW. For the project to move forward, park officials need to sign off on a reciprocal-use agreement outlining terms of the 30-year deal between the Park Board and school.

Supporters of the athletic complex had hoped the Park Board would sign off on the proposed field by year’s end, but that seems unlikely.

Park Board President Jon Olson said the ball is in the city’s court. “It’s not in our hands now,” he said.

Those who back a new athletic complex say it’s a matter of equal opportunity for student-athletes at the 106-year-old private high school.

While the school has a practice field, the football and soccer teams play games at suburban locations.

School leaders have proposed a football/soccer field with bleacher seats accommodating 750 spectators, new lighting, a press box and a sound system. «

Read original article here at the Downtown Journal website.

Star Tribune: U.S. official sees faults in DeLaSalle's riverfront athletic complex plans

Reporter Rochlle Olson writes in her article:

» The residents of Nicollet Island picked up some support from the federal government in their opposition to the proposed DeLaSalle High School athletic complex.

The proposed football field does not meet the criteria for “compatible riverfront uses” for the riverfront site, wrote JoAnn Kyral, superintendent for the Mississippi National River and Recreation Area, a unit of the National Park Service, which is under the U.S. Department of the Interior.

The field is not reliant upon the river, a riverfront location or a connection to the river for its operational needs or economic benefit, she wrote in a letter offering comment on an environmental assessment of the proposal.

Kyral listed a series of substantial objections to the football field. She said the proposal contradicts the goal of preserving public open space and historic preservation. The proposed development would adversely affect the historic St. Anthony Falls in a number of ways, she wrote. «

Read the entire article here at the Star Tribune website.