Title
AN ORDINANCE AUTHORIZING THE SALE OF CERTAIN PROPERTY ON RICES POINT TO THE DULUTH SEAWAY PORT AUTHORITY FOR $102,747.75.
Body
CITY PROPOSAL:
The city of Duluth does ordain:
Section 1. That pursuant to Section 2-176 of the Duluth City Code, 1959, as amended (the Code), the city council finds that:
(a) The manager of the city’s physical planning division has reviewed the proposed conveyance of the property herein described (the “property”) to the Duluth Seaway Port Authority (the “authority”) and found conveyance thereof to be in conformity with the city’s comprehensive land use plan;
(b) The St. Louis County Assessor, acting as city assessor, has provided an estimate of the market value of the property in an amount of $102,747.75;
(c) The Property as legally described in in the quit claim deed attached hereto as exhibit A (the “deed”) is hereby determined to be surplus to the city’s future needs and is therefore appropriate for sale;
Section 2. That as provided for in section 2-177.3 of the code, the council finds that the needs of the authority are greater in importance than the need of the city to retain said property and that the best interests of the citizens of the city will be best served by accomplishing such conveyance.
Section 3. That the proper city officials are hereby authorized to sell and convey the property in St. Louis County, Minnesota, legally described in the deed, to the Duluth Seaway Port Authority, a port authority under Minnesota Statutes Chapter 469, for the amount of $102,747.75 to be deposited into Fund 110, Department 700, Organization 1420, Object 4640 (General fund, transfers & other functions, capital program, sale of land), and further to execute all documents necessary with regard to said conveyance.
Section 4. That ordinance no. 10290 is hereby repealed.
Section 5. That this ordinance shall take effect 30 days after it’s
passage and publication.
Statement of Purpose
STATEMENT OF PURPOSE: The purpose of this ordinance is to re-authorize the sale and conveyance of ten parcels of property on Rice’s Point to the Port Authority for $102,747.75.
In 2006, the city acquired ten relatively small parcels of land on Rice’s Point from the Soo Line Railroad Company, doing business as the Canadian Pacific Railroad, for the construction of Helberg Drive. The ten parcels totaled approximately 136,000 square feet in size. The acquisition actually included more property than the city needed for the road but the railroad presented it as a “package deal”. The city paid approximately $84,000 for the property. Aside from the road, the city has no need for the property.
The Port Authority does have need for a portion of the property to facilitate the development of new loading and unloading facility at the port and also owns other property in the area. Without this property, the authority will not be able to implement its development proposal and will lose access to an approximately $10 Million federal grant that is being made available for port improvements.
In 2014 the port agreed to purchase the property from the city for $102,747.75, an amount which will at least equal its present market value. This ordinance would authorize the sale. On that basis, city ordinance no. 10290 was approved for the purpose of authorizing the sale.
But consummation was held up by a number of issues, one of which was the allocation of risk for possible environmentally hazardous conditions on the property arising from its use by prior users who were no longer available to be responsible for their actions. The city and the port have now received a “No Association Determination” and a “No Action Determination” from the Minnesota Pollution Control Agency and so the transaction can be completed.
The reason for the repeal of the original authorization and the passage of this ordinance is that, as the parties prepared for closing, it was determined that there were errors in the legal descriptions of three of the parcels and so the authorization would need to be modified. Because there were ten parcels involved and because three of them needed to be modified, it was determined that repealing the original ordinance and approving a new ordinance with the correct descriptions in it would the least confusing way to accomplish the conveyance.
Tax base impact statement: As the property is being conveyed to another governmental entity, there will be no tax impact resulting from this sale.