Category Archives: Neiman Sports Complex

Articles about the White Elephant Neiman Sports Complex at Ft. Snelling

The 201 Building in Review


Occasionally, there are still references to the unfortunate history of the MPRB’s 201 Building at Fort Snelling that the Park Board owned for nine years with no tenant or income.  Recently, there was a reference to the 201 Building at a Lake Nokomis CAC meeting; and at the last Park Board meeting on September 19, 2012 there again was a reference to the 201 Building.  During the September 19, 2012 Park Board meeting, Commissioner Liz Wielinski referred to the 201 Building and then Commissioner Bob Fine attempted to correct her.  However, both Commissioners Wielinski and Fine were correct in speaking of the unfortunate history of the 201 Building because there were TWO unfortunate incidents in the MPRB’s history of the 201 Building.

For the purpose of clarification, here is a brief review of those two incidents.

The 201 Building at Fort Snelling (also known as the Old Calvary Building) was acquired by the MPRB in 2001 with the intention of leasing it to the Wild Hockey team for practice sessions.  However, the Park Board’s Enterprise staff implemented the purchase of the building BEFORE the lease with the Wild was signed.  So when the deal with the Wild fell through, the Park Board was left with an empty building, no income, financial commitments–and no recourse.   Many blamed the Wild for walking, but the reality is that Park Board staff should have had the protection of a signed lease prior to making the significant commitment that it did.

Then, in July of 2002, Enterprise staff recommended that the Park Board enter into a lease for the 201 Building with The Fort, LLC, a company headed by Robert Naegele III, for an athletic facility, but the lease drawn up by the Enterprise staff failed to include a provision for a construction bond.   So when Naegele’s company abandoned the project before completion but after significant improvements were made, the Park Board again was left with an empty building, bonding payments and no income stream.  But this time there were also contractor lawsuits for $1.8M.  Again many blamed Naegele, but had there been a construction bond the Park Board would have been protected.

The 201 Building was eventually sold to the Boy Scouts in 2009 for $4,299,652.  After fees, the Park Board’s proceeds from the sale were $4,104,064.  According to Enterprise staff, the Park Board had a profit of $1,221,954; but, according to Park Watch’s figures, the profit was only $209,313.


Here is a summary of the MPRB’s  sale of the 201 Building:


The 201 Building at Fort Snelling, which the Park Board acquired in 2001, was intended to be a profit-making venture.  However, it never was occupied and it never made any money.  It turned out to be an expensive white elephant.  In June 2009, the Park Board completed the sale of the 201 Building and adjacent land to the North Star Council of the Boy Scouts of America.

According to the Park Board’s calculations, there was a profit of $1,221,954, but according to Park Watch’s calculations, there was a profit of only $209,313.


To understand the sale of the 201 Building, one needs some background information about the acquisition of the 201 Building and the Fort Snelling Athletic Complex, known also as Neiman Sports Complex.

The Neiman soccer fields were developed first.  The bulk of the land for the entire Neiman Complex is rented from the DNR and is not owned by the MPRB. Twenty-year bonds in the amount of $11,270,000 were issued on August 29, 2001, to pay for the project’s improvements.  Semi-annual payments for these bonds were allocated to both principal and interest.

The acquisition of the parcels comprising the 201 Building and adjacent land occurred during 2001 and was a separate transaction.  The 201 Building was acquired in anticipation of an agreement that General Manager Donald Siggelkow was negotiating with the Minnesota Wild hockey team.  It was the cash flow from the lease with the Wild that was to pay for the interest on the second bond offering.

Twenty-year bonds in the amount of $2,200,000 were issued for the acquisition of the 201 Building and adjacent land on July 11, 2002.  Payments for these bonds were for interest only with two balloon payments of $1M each for the principle due at the end of the bonding period in 2020 and 2021.

But the negotiations were never consummated and the deal with the Wild hockey team fell through, leaving the Park Board with an unleased building, $2,200,000 of bonds and no income to cover the yearly interest payments totaling $94,500.

Next chapter was the leasing of the 201 Building for the development of a skate park with no provision for a construction bond.  When the tenant abandoned the project mid-construction, the Park Board was left again with an unleased building, $2,200,000 of bonds and no income stream.  But this time there were also construction lawsuits for $1.8M.  The lawsuits were eventually settled and a lien for $945,000 was placed on the building.


The selling price for the 201 Building and adjacent land was $4,299,652.  After the brokers’ fee and closing costs of $195,588 were deducted, the total sale proceeds were $4,104,064.

According to the staff study report presented to the Administration and Finance Committee on September 16, 2009, the total costs outlined for the 201 Building were $2,882,110.  After subtracting this figure from the total sale proceeds of $4,104,064, there was a profit of approximately $1,221,954.

201 Building Acquisition………………………………………$780,000

Land Acquisition ($5.73 * 97,789 SF)……………………..$560,970

Parking Lot Improvements(3) ($2,000 * 176 stalls)……$352,000

Building & Property Improvements(2) (Lien Payoff)…..$945,000

Legal Fees (201 Lien)…………………………………………$105,968

Legal Fees (Sale)………………………………………………$138,172

Total MPRB Costs……………………………………………$2,882,110

Net Proceeds for the Sale of the 201 Building…………………………….$4,104,064

Total costs for the 201 Building……………………………………………….$2,882,110

Net income or profit…………………………………………………………….$1,221,954


However, Park Watch has been tracking the disposition of the 201 Building for the past three years.  Park Watch has been attending meetings and reviewing extensive data acquired through the Minnesota Government Data Practices Act.  The Park Board’s figure asserting a profit of $1,221,955 does not correspond with the figure that Park Watch arrived at.

The total costs according to Park Watch’s calculations are approximately $3,903,751.  And the resulting profit was only $200,313, considerably less than the Park Board’s figure of $1,221,954.

The following figures are based on information acquired from the Park Board:

201 Building Acquisition (same as above)………………………………$780,000

Land Acquisition of “GSA” property, based on
Don’s August 2006 figures………………………………………………………………………..$1,100,000

Parking lot and moving the road(3), based on
Don’s August 2006 figures…………………………………………………………………………..$250,000

Lien payoff(2), based on Don’s
August 2006 figures………………….$945,000

Total, based on Don’s August 2006 figures……………………………$3,075,000

Approximate bond interest(4)………………………………………………$575,611

Legal fees (Lien), based on the September 2009
staff report……………………………………………………………………………$105,968

Legal fees (Sale), based on the September 2009
staff report……………………………………………………………………………$138,172

Total costs for the 201 Building and Land………………………………$3,894,751

Net proceeds for the sale of the 201 Building…………………………………………$4,104,064

Net income or profit…………………………………………………………………………..$209,313


The Park Board’s calculations do not take into account the annual interest payments on the $2,200,000 bond issue, which was the issue for the 201 Building and adjacent land; these annual interest payments total approximately $575,611.  It appears that there was some rearranging of figures to create the impression that the project made more money than it did.  For instance, the two separate bond offerings were merged to create the impression of just one bond offering, which obfuscates the issue of bond interest.

And nowhere is there any line item for the countless hours of staff time expended planning, developing, negotiating, etc. this unsuccessful project.


(1) Park Board Committee Study Report, Property Sales Analysis, dated and presented on 9/16/2009, to the Administration and Finance Committee of the MPRB

(2) Line Payoff, based on MPRB Meeting Handout 8/2006, from Don Siggelkow

(3) Note difference from one MPRB report in 2006 to the MPRB Report in 2009

(4) Refer to document obtained from the MPRB, Schedule of Interest Paid on 201 Building and Land Bonds


Arlene Fried

Co-founder of Park Watch



5:00 P.M. REGULAR BOARD MEETING. Committee meetings to follow. The meetings will be held in the boardroom at Park Board headquarters, 2117 West River Road, just north of Broadway Pizza.

5:30 P.M. OPEN TIME. Speakers need to sign up before 3:00 p.m. the day of the meeting.

This meeting is the last meeting that David Fisher will be attending as Superintendent. His four month stint as interim superintendent ends on October 31. We are grateful that he accepted the invitation to come to Minneapolis to fill this position.

This meeting is a meeting with many significant agenda items. The most important item on the agenda is the vote to approve the employment agreement with Jayne Miller, who–at the last meeting–was selected by a unanimous vote to be the new MPRB Superintendent.

Some highlights of the meetings that will be voted on :

The I-35 Bridge Memorial.
The concession agreement with Bread & Pickle at Lake Harriet.
The reconvening of the CAC for the Wirth Beach Project III.
The non-appointed CACs for two playgrounds at Lake Harriet.

There will be a presentation of the Superintendent’s 2011 Recommended Budget. This is a report item and will not be voted on at this time.

The following is the link to the complete agenda, with staff reports, for the MPRB Board of Commissioners’ meeting of Wednesday, October 20:

MPRB meetings are broadcast live from 5-9 p.m. on the City of Minneapolis Government Meeting Channel 79 on Comcast cable and online at

The regular meetings are rebroadcast on Channel 79 at 1 p.m. Saturdays and 5 p.m. on the second and fourth Wednesdays of each month. Webcasts for the recent two months are posted two to five business days after the meeting and are available for viewing under “Webcast Archives” at

The Park Board’s website is

Arlene Fried, Co-founder of Park Watch

Park Board Completes Sale of the 201 Building

The following article by James Shiffer appeared on the Star Tribune website July 22, 2009. A more detailed history of the 201 Building fiasco was posted on Park Watch on October 14, 2008.


Last year, Whistleblower described how a long-vacant property owned by the Minneapolis Park and Recreation Board would become an urban base camp for the Northern Star Council of the Boy Scouts of America. The Boy Scouts bought the old cavalry building last year, and on June 24, the council closed on the second parcel, finishing the deal and ending the park board’s nine-year history with the property, said Don Siggelkow, park board general manager.

The sale of the old cavalry building and an adjacent parcel brought the park board $4.2 million, approximately the same amount the park board spent on acquisition, legal fees and other associated costs, Siggelkow said. The money went straight to the city to pay off the bonds used to acquire the property, he said.

Despite many uses envisioned for the property – a field house, a practice arena for the Minnesota Wild, a privately-developed skateboard park – it never did more than serve as storage for lawn mowers and other equipment. After the skateboard park deal fell apart, the park board even ended up paying $900,000 to settle a lawsuit – despite the fact that no public money was supposed to go into the project. Siggelkow said that the Boy Scouts’ plans for it fulfills the park board’s original intent to use the property for “recreational amenities.”

Still, he said the park board has learned a lesson from its experience with the old Drill Hall, also known as the “201 Building.” It’s difficult for a private developer to pull off a project when the park board retains ownership of the property, Siggelkow said. “If you’re going to pursue a private venture, we probably ought to consider a different mechanism.”

The experience with Drill Hall hasn’t deterred the park board from pursuing “enterprise” projects. Siggelkow said the board’s focus is now on the proposal to construct a new restaurant concession at Lake Harriet, the subject of a citizens’ committee that’s expected to wrap up its work in September.


On September 25, 2008, the Star Tribune published an article about the Minneapolis Park Board’s 201 Building, but the article did not elaborate on the circumstances that were responsible for the problems that caused it to be an eight-year white elephant. Here’s the story as documented by Park Watch.

The 201 Building at Fort Snelling was acquired by the Minneapolis Park and Recreation Board in 2000 and it has been a series of costly problems ever since. There were problems with the purchase, problems with the lease and problems with the selling of the building. It was called “an enterprise project” which meant that it was supposed to make money for the Park Board. However, it’s never made one cent for the Park Board. It’s not even broken even. During the eight years the Park Board has owned it, it has only racked up huge debts. It has been a monumental failure. And what is appalling is that Superintendent Jon Gurban has never done a cost analysis of the project or attempted to establish any honest understanding of what the problems were.

Park Watch has been monitoring this failed enterprise project since the liens against it were filed in 2004. Last year Commissioner Walt Dziedzic mentioned to me that he was told that when the building is sold the Park Board will make money on it. He was not told the truth. The accrued debt on this building is so great that the best that can be hoped for is that it is a wash.


Chapter 1. PURCHASE OF 201 BUILDING. Mistake #1 was MPRB’s General Manager Don Siggelkow’s moving ahead with the purchase of the 201 Building and land in 2000 BEFORE the anticipated contract with the Wild hockey team was signed and sealed. When the deal with the Wild fell through, the Park Board was left with an empty building, no income stream and no recourse.

Chapter 2. RENTING OF 201 BUILDING. Mistake #2 was the drafting of a lease in July of 2002 with The Fort LLC, a company headed by Robert Naegele III, for the creation of an athletic facility, but FAILING TO INCLUDE A PROVISION FOR A CONSTRUCTION BOND. It was Shawne FitzGerald’s research that brought to light the omission of the construction bond.

When Naegele’s company abandoned the project before completion but after significant improvements were made, the Park Board was again left with an empty building, no income stream, unpaid bills, lawsuits for $1.8M and no construction bond. In a later conversation that I had with John Erwin, a former park board commissioner who voted for the skate park, I learned that John voted in favor of the project after he and other commissioners had been assured at the time that there was “no exposure” for the Park Board. They had been misinformed.

Superintendent Jon Gurban never initiated an investigation of this failed project; so there was never any accountability or understanding of why the project that was supposed to make money failed. In a Star Tribune article about the lawsuits in June of 2004, Siggelkow was quoted as saying: “…but there’s nothing the Board could have done to protect the contractors.” Siggelkow was wrong. The construction bond would have saved the Park Board and the contractors a lot of grief. Neglecting to require a construction bond was a serious and costly omission.

Meanwhile, the Park Board was (and still is) paying interest on $2.2M worth of bonds for the 201 Building. The annual payment is $94,500 and that payment is for interest only. The bonds run for 20 years with two balloon payment of $1M each due in 2020 and 2021. Since the bonds were issued by the City of Minneapolis in 2002, the Park Board has paid out approximately $575,000 in interest on the 201 bonds.

At a Park Board meeting in August of 2006, it was estimated that at the time, the 201 Building had so far cost the Park Board $3,075,000. It is important to note that this figure, which included the $945,000 settlement figure, did not take into account the bond interest of $575,611 or escalating legal fees paid to Brian Rice’s law firm. We have just completed reviewing the 201 Building’s legal fees (acquired through the MDGPA) from June of 2004 to July of 2008. The total for this period is $229,152. The 201 Building’s total debt is now approaching $4,000,000, which contradicts the $3,000,000 figure provided by the Park Board for the Star Tribune article. And this $4,000,000 figure does not take into account the building maintenance costs, other miscellaneous costs, the brokers’ fees and the countless hours of staff time spent on this project over the eight years of its existence.

Chapter 3. ATTEMPTING TO SELL THE 201 BUILDING. This chapter is marked by confusion over the brokers’ fees and the actual selling price. On July 21, 2007, the Park Board entered into a brokers’ agreement with Colliers Turley Martin Tucker to sell the 201 Building and adjacent land. In August of 2007, a letter was sent out by the brokers requesting purchase offers for the 201 Building and land. A number of offers were received and the Park Board accepted an offer by the North Star Council of the Boy Scouts of America. This offer by the Boy Scouts was for $2,000,000 for the 201 Building and part of the land with an option to purchase the remainder of the land for an additional $2,000,000, contingent upon a clear title.

But when the purchase agreement was signed on October 31, 2007, it was different from the offer price. The price of the original $2,000,000 option had increased to $2,250,000. So the selling price went from $4,000,000 to $4,250,000.

The October 31 purchase agreement is clear that the $80,000 brokers’ fee is to be deducted from the $2,000,000 purchase price. However, for the option, the exact amount of the brokers’ fees is unclear.

But when we attempted to get more data about the brokers’ fees, we ran into a brick wall. The Park Board ceased providing us with any information in response to our numerous requests under the MGDPA. And oral questions have been ignored. This sale has not been a straight forward sale with a stated selling price and a stated brokers’ fee as one would expect. And Park Watch questions whether the Boy Scouts’ complicated purchase agreement represents the best offer possible for the 201 Building.

What is important to remember about the 201 Building disaster is that it could have been prevented. Had staff waited until AFTER the lease with the Wild was signed to complete the purchase of the building, the Park Board would not have been stuck with a costly empty building. And later on, a requirement for a construction bond in the 2002 lease would have protected the Park Board in the event of a default by The Fort LLC.

Arlene Fried
Co-founder of Park Watch


Star Tribune Letters: Park Board Plays with Taxpayer Money

This particular taxpayer is not happy:

Regarding the Jan. 17 article “Skateboard project falls flat”: Have Minneapolis parks commissioners collectively lost their minds? In the real world there would be consequences for losing $900,000 on the job. The entire board should be fired! I’m sure the public will accept any resignations with pleasure.

I don’t know how “star struck” the board could be by a big name that they totally lose all basic common sense to negotiate and maintain a contract. Doesn’t the board consult with lawyers on staff? Well, I guess it’s only money for a kids’ skateboard park, maybe nobody will notice. Oops, sorry. What does it take to get elected officials to be accountable for the taxpayers money they carelessly squander? As far as I know, we just don’t pick the money off of the park’s trees.


Read original here at the Star Tribune website.

Star Tribune: Skateboard park proposal falls flat

Robert Naegele III’s state-of-the-art facility wasn’t built; instead, the Park Board got sued. Star Tribune reporter Rochelle Olson writes in a story published January 17:

» Minneapolis taxpayers face a $900,000 legal settlement because of the Park and Recreation Board’s failed attempt to develop a skateboard park with Robert Naegele III, 40-year-old son of Minnesota Wild owner Bob Naegele.

The board will now decide whether to pay the tab to settle a lawsuit filed by several contractors or sell off the vacant property near Fort Snelling at foreclosure. The options are the result of a mediated legal agreement with the board, the contractors and Naegele. Park board members say the Naegele name lulled them into a false sense of security.

As a result, what was supposed to be a privately funded project on public land will end up costing public money. «

» The origins of the would-be skateboard park date back to September 2000, when the park board paid $748,000 for an old federal building close to its baseball and softball fields and the indoor tennis center.

At first, the Wild considered converting it into a training facility, but the costs made the team choose Parade Stadium instead, said Don Siggelkow, assistant superintendent.

Then along came Robert Naegele III with a proposal to turn the 27,000-square-foot building into an indoor-outdoor state-of-the-art skate park with an observation deck encircling the park.

His company, called The Fort, signed a lease with the park board that stated the firm would pay for renovation and construction.

But within six months after construction began in September 2003, The Fort stopped putting money into the project, according to a written report submitted to the board by its attorneys, Brian Rice and Karin Peterson. At one point, one of the subcontractors even loaned the project $300,000 to keep it going.

After negotiations with The Fort failed, the Park Board terminated the lease in June 2004.

Later that year, contractors and subcontractors sued The Fort and the Park Board to recover $1.8 million in unpaid bills.

Negotiations to settle the suit began in July. The mediated legal agreement includes a $22,500 payment by Naegele to the Park Board and $150,000 to one of the subcontractors, Steenberg-Watrud Construction. Rice said the Park Board didn’t want to take a chance in court, which might have required it to pay an additional $200,000 in attorneys fees. «

Read full story at Star Tribune website.

See more information about this fiasco here, here, here, and here.

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 Commentary: Charles Birnbaum: Park Board isn't staying true to Wirth's vision

In an October 28 Star Tribune Commentary, Charles A. Birnbaum, founder and president of the Cultural Landscape Foundation in Washington, D.C., writes about how the Minneapolis Park and Recreation Board is considering privatizing, selling off and even giving away precious Minneapolis public park property:

» From Atlanta to Seattle, our nation’s legacy of urban parks are under siege from a variety of threats — expansions by neighboring institutions, new parking lots and new “destination features.” Minneapolis is no exception.

In the age of video games and attention deficit disorder, “open space” has become a dirty word. Parks are seen as a void that must be filled, “programmed” to amuse all comers.

Who decided that strolling under a canopy of trees is not a sufficient experience in its own right? Have we stopped valuing the humanizing scale and tactile marvels of nature? Do we still appreciate our history and public gardens?

This national trend to clutter park grounds with activity-oriented “focal points” is lamentable and perplexing because park users themselves are not demanding change. According to surveys conducted over the past two decades, the majority of Americans visit parks specifically for passive, reflective experiences.

Within an emotional and politically charged atmosphere, small but vocal groups are taking control of the public debate to advance their own narrow agendas — resulting in ill-conceived park redesigns. Democratic spaces are being privatized with partial closing of parks for special events, construction of additions, long-term leases to special interests and private concessions — changing the character of the landscape irrevocably.

These formulaic alterations to our parks have their own needs for long-term maintenance with more parking and more pavement. Strip away the historic. Make way for special interests (this is often the real objective). Today “green” too seldom means a generous sweep of trees and lawn with the songs of birds, and too often means dollars and the ching-ching-ching of cash registers.

Minneapolis is a city blessed with one of the nation’s premier systems of parks and boulevards, yet based on current proposals that I saw on my trip to the Twin Cities last week, it appears that elected park commissioners and their appointed superintendents are today considering privatizing, selling off and even giving away precious public park property. «

Read the rest of the commentary on the Star Tribune web site.

$1.8 Million Suit Against Park Board Rescheduled

201 building photo

The Fourth Judicial District Court trial for the $1.8 million lawsuit by McCrossan et al versus the Park Board et al has been postponed / rescheduled. It is currently on the docket to be heard by Judge Isabel Gomez in February of 2006.

The case is public information, and can be viewed by visiting the 12th floor of the Hennepin County courts building and asking for File # 04-18022, McCrossan et al versus the Park Board.

More information:
Southwest Journal Article or earlier Park Watch story.

Southwest Journal: Park Board Goes to Trial October 31 Over Ft. Snelling Development

photo of 201 building
201 building

« A group of contractors is suing the Minneapolis Park and Recreation Board to recover $1.8 million in unpaid work they did on a proposed indoor/outdoor skateboard park at Ft. Snelling, a private facility on Park Board land. A settlement could come soon.

The issue is a flashpoint for Park Board critics, who charge the Board has wasted money.

Problems center on the Fort LLC, one of the Park Board’s public-private partnerships designed to add amenities and revenues to the cash-strapped system. Fort was going to offer a space for action sports, such as skateboarding and BMX biking, at Ft. Snelling, in what is known as the 201 Building. The Park Board was supposed to get 15 percent of the project’s gross revenue, according to the 2002 lease signed by Fort Chairman Robert Naegele III.

Construction was stopped far short of completion.

Fort and the Park Board are among several named parties to the suit. However, Fort has no assets; the Park Board has the deep pockets.

At a minimum, the lawsuit is a Park Board embarrassment. Instead of raising money, the Park Board will at least pay legal fees to defend itself.

At worst, the Park Board will pay contractors nearly $2 million for a project that was never built.

It points to pitfalls in public-private partnerships.

Subcontractors filed suit in 4th District Court Dec. 3. A five-day trial is set to start Oct. 31, according to Judge Isabel Gomez’ staff.

The parties have been in mediation.

Don Siggelkow, Park Board general manager for administration and finance, said in late July that he believed there would be a tentative deal before the trial. A Board vote could happen as early as Wednesday, Aug. 17.

Kyle Hart, an attorney for the subcontractors, was less optimistic. “As we sit here today, there is no settlement agreement,” he said July 29.

(Hart represents C.S. McCrossan Construction, Ankeny Kell Architects, Lloyds Construction, Steenberg-Watrud Construction and Rainbow, Inc.)

John Holper, attorney for Associated Contractors, the general contractor, declined comment as did Mary Schwind, Naegele’s attorney.

Park Board critics such as Shawne Fitzgerald call the Park Board’s deal with Fort “a scandal.” Fitzgerald, who extensively researched the project, said the Park Board should have required Naegele to post any bonds prior to starting work, because Fort LLC was a shell company with no assets to attach.

“These people need to be held accountable for such poor government,” she said,

The best laid plans?

The lease between the Park Board and Fort provides the following history.

The Park Board acquired the 201 Building from the Bureau of Mines on Sept. 19, 2000 for $780,000, for an indoor athletic venue to complement the Park Board’s Neiman Sports Complex.

The Park Board spent $95,000 to move a roadway and $1.1 million to acquire additional properties adjacent to the 201 site.

The Park Board commissioned Miller Dunwiddie Architects to assess the 201 Building’s reuse. The architects found it needed $1.4 million for exterior improvements and up to $2.3 million for indoor athletic use.

Fort submitted a proposal to redevelop the 201 Building and the adjacent land in November 2001. The Park Board granted Fort exclusive development rights in March 2002.

“Tenant has proposed to use its own funds to renovate and build an alternative sports center in the 201 Building,” the lease said.

According to Park Board minutes, the Board approved it on a voice vote. Walt Dziedzic, Ed Solomon, Jon Olsen, John Erwin and Vivian Mason apparently backed the deal. The minutes said Marie Hauser voted no, and Rochelle Berry Graves abstained. (Then-President Bob Fine and Annie Young were absent, staff said.)

Hauser raised concerns that the skate park use was too narrow, the minutes said. Graves unsuccessfully requested a vote delay so the Board “would have a chance to better review the lease agreement.”

Naegele and Fine signed the lease July 24, 2002.

Fine said he opposed the lease on several grounds and would have voted against it, but he had to sign it because the Board approved it. He didn’t like the proposed skateboard park, preferring an indoor soccer and basketball facility that would fit better with other sports complex uses, he said.

Initially, the Park Board had talked to the Minnesota Wild hockey team about using the Ft. Snelling building as a practice facility, Fine said. The Wild talked about pumping in as much as $5 million into the facility, he said.

“But all of a sudden, the Wild wasn’t going to use it,” he said.

Robert Naegele III, son of the Wild’s owner, was aware of the property because of the hockey discussions and came forward with the skate board park proposal, Park Board leaders said.

Fine said although the lease gave the Park Board 15 percent of the gross revenues, Fort got to deduct all costs from “qualified improvements” from its payments. The Park Board would not have seen any money for several years, he said.

“I thought it was a big financial risk,” Fine said, “Their names may have been Naegele. But they were not personally guaranteeing anything.”

A Nov. 4, 2002 Minneapolis-St. Paul Business Journal story said the 26,000-square-foot facility would include a rock-climbing wall and skateboard areas. The outdoor space would feature 75,000 square feet of outdoor skate park, inline skating and ice hockey rinks.

Fine said he thought the project foundered was because Fort couldn’t get the financing.

The Board’s President and Vice President, Olson and Erwin, declined to comment until the dispute was settled.

Mason, another yes vote, said, “At the time, it sounded like such a good idea. From kids, that was the request I got most often: What were we going to do about having skate parks?”

Mason said she anticipated a project similar to Ft. Snelling’s Fred Wells tennis center, providing opportunities for inner-city kids, she said.

“I don’t believe our staff and legal counsel did a good job on that contract,” Mason said.

Dziedzic, also a supporter, said he still didn’t think the Park Board was liable. “But we should have been a little more cautionary, yes,” he said. “Why we weren’t, it is a matter of conjecture. We should have been. We weren’t. But I can see where we were overwhelmed with the [Naegele] name.”

Mary Merrill Anderson, a candidate for an at-large Park Board seat, was Superintendent when the least was signed. “I am not sure of all of the details about why the Park Board wasn’t more protected,” she said. “I have been told different stories that the Park Board is protected in the lawsuit.”

(The contractors have filed a mechanic’s lien to recover their costs. A Siggelkow says the law doesn’t allow contractors to put a mechanic’s lien on public property. The contractors’ attorneys say in this case, the property was for a private, not public, use so the lien is allowed.)

Dziedzic is already looking for ways to recover any payments.

“I think we can still take the kid [Naegele III] to court,” he said. “The kid is going to inherit the money some day. The Park Board is going to be here a long time, and we will get our money someday. It may take awhile.”

Financially unprotected

Should the Park Board have required Fort to post construction bonds to guarantee the work?

“I think we had a good contract,” Sigglekow said. “The legal aspect is that it is not our project. We did not engage in any contracts. Š We don’t feel the liens are a legal remedy.”

He said the general contractor and the subcontractors would have known Fort was a shell company and they could have asked for a bond or money up front.

“If you are going to scratch your head and wonder how this happened, I would first go to the contracts and ask why did you perform the work without getting paid,” he said.

Hart said Fort sweet-talked the subcontractors into thinking the money was just around the corner. One firm even loaned Fort $300,000.

Hart, the subcontractors’ attorney, said the Park Board lease documents indicate its support for the project. “The Fort and the Park Board were working hand in hand to get this work done,” he said.

Why didn’t the contractors ask for a stronger money guarantee?

“My guess is that these parties all thought they had mechanic lien rights,” Hart said.

“Either way you go at it, the Park Board is wrong,” he said. “Either it is public property, in which case they should have required a bond, or it is not public property, in which case we are entitled to file the liens.” »

Southwest Journal: Public-private problems for the Park Board By Scott Russell

Original article at this link to the Southwest Journal web site.