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MEMOEANDUM <br /> <br />Item 5. <br /> <br />TO: <br /> <br />FROM: <br /> <br />DATE: <br /> <br />SUBJECT: <br /> <br />Mayor and City Council <br /> <br />Pat Klaers, City Ad/f~rator <br />May 24, 2004 <br /> <br />Koehler Property <br /> <br />Mary Koehler submitted a letter requesting $185,000 for their property located at 1221 5m Street. <br />The estimated market value of the property is $178,000 (as indicated by the sales comparison <br />approach). This figure comes from the appraisal the city authorized and which was completed by <br />Jerry Smith of White Dove Appraisals. <br /> <br />I do not like having the city pay more than what the appraisal indicates is a fair market price but, in <br />this case, I recommend we accept the offer from Mrs. Koehler. With the adjacent Bailey property, <br />the city paid the amount identified in the appraisal. However, each situation is different and in 2001 <br />with the acquisition of the Bailey property we also were involved in a life estate situation and the <br />garage is still being used as storage by Mrs. Bailey. <br /> <br />In this situation with the Koehler property, I believe we should move quickly in order to allow the <br />Koehlers to take advantage of the current low interest rates. If the city does not move quickly, I am <br />concerned that the Koehlers may decide to not sell and stay in their home for a number of years. <br />Acquisition of this property at some time in the future would be more expensive than the offer <br />currently on the table. If the Koehlers do not sell for a few years, it would be difficult for the city to <br />make long-term library expansion plans. <br /> <br />Obtaining this property will assist the city when the time comes to attempt to acquire the Peterson <br />property that is directly west of the library building. By obtaining this property, we will not be <br />"required" to obtain the Peterson property for the future expansion of the library and accordingly, <br />we will be in a much better negotiating position. Design options can be laid out so that if we never <br />acquire the Peterson property, we could plan for one (or two?) expansions at the library utilizing the <br />Koehler and Bailey properties as parking and some of the current parking lot for a building <br />expansion. Overall for the long-term benefit of the library, I think it is in our best interest to acquire <br />both the Koehler property now and the Peterson property in the future. <br /> <br />Recommendation <br /> <br />It is recommended that the city accept the offer from Mrs. Koehler to purchase the property at <br />1221 5th Street for $185,000. <br /> <br />S:~Council~Pat~ 2004~ Koehler0524.doc <br /> <br /> <br />