Laserfiche WebLink
<br />City Council Minutes <br />February 13, 2006 <br /> <br />Page 6 <br /> <br />would be payable in a balloon payment at the end of that five years which would begin two <br />years from the date of the purchase agreement. <br /> <br />. <br /> <br />The city would enter into a separate lease agreement to lease the golf course for the next two <br />years with this lease amount being the same amount as interest payments. He stated that <br />there are some issues that need to be resolved in not having title to the property the first two <br />years, to make sure that we have all the rights and conditions to ownership that we need in <br />order to operate a golf course. It would clearly be stated that the city is not buying the <br />business but leasing and buying the land and equipment. He also suggested to protect Mr. <br />Krause against the possibility tl1at the council would fail to close the contract for deed to <br />extend the final plat approval for an additional tl1ree years so if for any reason the council <br />walked away from that $300,000 down payment and didn't close the sale in two years that <br />there was still time left for a final plat approval. <br /> <br />Councilmember Dietz stated that he is still very opposed to this project and with principal, <br />interest, irrigation and equipment it is going to cost the city $2.7 million for this project. He <br />doesn't believe the golf course is worth that amount of money and that paying 6 percent <br />interest is exorbitant for these times. <br /> <br />Councilmember Farber stated that he likes the project and that it is an important piece of <br />property for the city. <br /> <br />Councilmember Motin inquired if there would be the need for a majority vote in two years. <br />Attorney Beck stated no, that tlus agreement would be self executing and that the city <br />couldn't legally get out of the agreement; the city would have to default. The idea is not to <br />leave a discretionary point. <br /> <br />. <br /> <br />Discussion followed on costs to open this spring, daily operation costs, and ways of funding. <br />The Council reviewed handouts of projected estimated revenue from park dedication fees. <br />The projection was with increases to fees for the next seven years. <br /> <br />Councilmember Dietz stated that he is fine with the park dedication fees paying the $90,000 <br />interest per year and the $300,000 down payment but doesn't feel the $1.5 million should <br />come out of the park dedication funds. He stated that the city has seven years to decide how <br />to pay the $1.5 million and didn't feel tl1at this burden should be with the park dedication <br />funds. <br /> <br />Councilmember Motin agreed. He stated that there must be some other type of reserves or <br />alternatives and to leave this option open rather than to have the burden fall on the park <br />dedication fees to pay the full amount. <br /> <br />Councilmember Farber stated that he looks at this as a recreation not a business. We have <br />trails and investments in parks that are costly and don't pay back a dime and he is not <br />expecting to make money on this golf course but to have as another recreational activity. <br /> <br />Attorney Nord stated that by structuring the payments this way Mr. Kraus has confidence <br />that the city will pay him and this has enabled him to get the price down to a level tl1at <br />works. Mr. Nord stated that everything he has heard tonight is what his client is expecting. <br /> <br />Mayor Klinzing stated that discussion will occur again as to where the payment money will <br />come from but that we need to look at the down payment money source. <br /> <br />. <br />