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City council approves Armory Square agreement

The Park Rapids City Council and Economic Development Authority approved separate resolutions Tuesday for the purchase of Armory Square from a development corporation.

Additional legal work and agreed upon renovation work on the historic downtown facility remains to fulfill the agreement, and the state still needs to give final approval to release the $2.5 million in end grant funds to complete the deal.

The council approved the first resolution Tuesday for the sale, purchase and redevelopment agreement between Armory Square Management Corporation and the Park Rapids EDA. The second resolution approved by the council enters the city into a lease agreement between the city and the Park Rapids Community Development Corporation (PRCDC).

The approved resolutions Tuesday were a formal action to agreements previously reached in principle.

The city will own Armory Square, except space remaining with the developer where Vallertas Mexican Grill currently is, and the PRCDC will lease the building from the city. The city's portion of the property is 20,889 square feet.

Once the Minnesota Management and Budget office approves the deal it will turn the agreements over to the Department of Employment and Economic Development for final approval.

Cynthia Jones, representing the PRCDC, spoke at Tuesday's council meeting prior to the vote to approve the agreement.

"I hope you are pleased with what we have accomplished to date," Jones said. "Here's where we are: we have secured funding for a design study, a feasibility study for a capital campaign and to hire an administrative contractor."

Jones explained a PRCDC team has met with an architectural firm and a target date has been set for completion by the beginning of March.

"The architectural design to this point is to remodel the building and bring it up to code," she said. "The design has not been to decide what are we doing with the basement to captivate the revenue that goes along with that, how we are going to price the drill floor, what will we do with the classrooms upstairs, what is the look of the building, how are we going to put the building together so it's user friendly. All of that is what's going into the design study right now."

The purchase price of Armory Square is $2.5 million in grant funds and will be adjusted to reimburse the city's legal expenses as well as those associated with the closing, survey, title, inspections and administrative expenses.

The council voted 4-0 in favor of the purchase and redevelopment agreement.

"I'd just like to thank the council for all the suggestions, listening and support that you've given," Jones said. "This has been a long road, but we're on the road now. We're moving at a pretty good rate."

The council also voted 4-0 in favor of the lease agreement between the city and the PRCDC, a non-profit corporation which will manage and operate the facility.

"Policies for operation are almost complete and a rate structure is being developed," Jones explained, stating the feasibility study for a capital campaign will begin shortly. "The identity and the name of the building has been unraveled. The building is going to be called Armory Square. The artistic portion of Armory Square will be the home of Upper Mississippi Center for the Arts."

The PRCDC has hired Vicki Chepulis as administrative consultant on a six-month contract. She will provide guidance in the formation of policies and systems to facilitate growth as the project moves forward as Armory Square and the Upper Mississippi Center for the Arts becomes operational.

"The fact that you are supporting, I believe Armory Square can be an asset, not just to Park Rapids but to this entire region, I think is really commendable," Chepulis told the council Tuesday. "I share that vision and I hope I can bring my past experience to helping that vision become reality, and to become an enriching and huge enhancement to this area."

New automobile dealership

The council also approved on Tuesday, following a recommendation by the Planning Commission, a conditional use permit to construct and operate an automobile dealership to be located just east of Walmart on Charles Street.

The developer, Aaron Marthaler representing Yellow Company, intends to construct a 11,900-square-foot showroom/shop for the sales of Chrysler Dodge Jeep and Ram automobiles, according to information presented at the council meeting.

Among the requirements by the Planning Commission, the developer will be required to provide storm water calculations showing that post development runoff does not exceed pre-development runoff, including directing stormwater into an infiltration basin located to the north of the site.

Yellow Company will donate 100 percent of the costs for the city to design, construct and install storm sewer, stormwater management, street, and sidewalk improvements on Charles Street at the east edge of Walmart to the unnamed street between L&M Fleet and Charlie's Marine. This north/south unpaved road is currently not open to traffic. The amount of the donation to cover constructions costs to the city is $226,200. The proposed site is 5.8 acres.

The council voted 3-1, with one seat not voting due to the resignation of council member Paul Utke, in favor of granting the conditional use permit. Erika Randall voted against approving the permit. New council member Liz Stone along with Mayor Pat Mikesh and Ryan Leckner voted in favor.

Utke was elected to the state senate in November and he resigned from the city council with two years remaining of a four-year term. The city is seeking individuals who are interested in serving on the city council until Dec. 31, 2018. Those interested can contact city hall.