The Nisswa City Council decided unanimously Tuesday night, May 7, that it will move forward with an abatement bond not to exceed $760,000 to fund a chamber of commerce welcome center and public restrooms in downtown Nisswa, as well as city park improvements and community center improvements.
Council member Tina Foster recused herself from all votes at the meeting May 7 because of an alleged conflict of interest in the matter. Tom Groen made the complaint, citing Foster’s seat on the Nisswa Chamber of Commerce board of directors.
While the bond will not exceed $760,000, the project total is quoted at $610,000 divided into three categories: park improvements, at a cost of $119,857; community center improvements, at $110,183; and the chamber building/public restrooms, at $343,584.
By email, city planner Loren Wickham explained that the not-to-exceed number of $760,000 reflects a conservative estimate of interest that could be incurred on the bond should it be for 15 years. However, the council opted for a 10-year bond, so the final amount will be significantly lower than $760,000, Wickham said.
The council also approved a lease agreement with the chamber of commerce for a 20-year term. This accounts for $204,000 over the course of the lease.
That lease cost to the chamber will be $900 per month for 10 years and $800 per month for 10 years after that. Some citizens at the meeting took issue with the fact that the rent dropped after 10 years, instead of increasing.
Groen said, during the public forum, that the council wasn’t taking into account the cost of inflation or repairs to the building. He also felt the council’s distinction on what portion of the new building would be for the chamber — 42 percent — was too low, arguing the chamber should be responsible for at least 50 percent of the cost.
Council member Gary Johnson explained that the council members negotiating the lease did not consider the atrium, which will be between the restrooms and chamber offices, as part of the chamber’s portion of the building.
He said that at 42 percent, and an estimated interest rate of 2.5 percent, the chamber’s portion of the cost amounts to $103,140 over 10 years. The rent the chamber will pay over that first 10 years amounts to $108,000 which, Johnson said, shows that the chamber is paying its share.
Council member Jan Pierce said the new building, which will be in the same place as the current public restrooms adjacent to the Paul Bunyan Trail, is bound by state law as far as what can occupy it. It’s not an ordinary storefront.
Former council member and former mayor Harold Kraus also spoke during public forum, arguing that any one of the 50 businesses people see as they walk down Main Street is a welcome center in itself. He, like others who spoke, agreed with the parks and community center improvements, but not the chamber welcome center.
Kraus’ overall concern was the amount of spending the city was doing. He said that between the Highway 371/County Road 18 project, the welcome center and talk of future plans for Main Street, the city would have serious debt.
Residents also expressed concern over the chamber still being around in 10 years, and one questioned why resident taxpayers were supporting the business community.
Shawn Hansen, chamber director, spoke in favor of the project, citing the connection between the city’s comprehensive plan and the chamber. She also discussed the importance of tourism to the community and the ways the chamber building would support that industry.
Council member Lenny Hodgson acknowledged the city’s risk, but said it was not the riskiest thing the city has done.
“The only way to guarantee, for lack of a better word, the chamber’s side of this ... would be not to do that. But I would also say that I’ve been involved in other things that the city has done where we spent major chunks of money that probably were less of a guarantee than this was,” he said.
Pierce said the city needed to move forward with the project.
“If we don’t do the things, however painful it may seem in the moment, to keep us unique and to make people come here, in 10 years’ time we are going to be a lazy little community of 2,000 people that has nothing more to offer than any of the other communities struggling to get to where we are,” Pierce said.
The council decided it will use tax increment financing only for the designs of the building. They expect low rates on the abatement bond, which will be sold at the council’s June 19 meeting.