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City approves lot agreements

The City Council approved agreements with Burlington Northern Santa Fe Railway Tuesday that will expand three downtown parking lots.

A mill and overlay of the four city parking lots bordering the BNSF tracks includes widening the Gun & Reel, Schubert's and Gladstone Inn and Suites lots to better accommodate modern vehicles.

However, the property belongs to BNSF and it had to agree to the easements, which add between 10 and 15 feet to the lot size.

Three areas in the original agreement were questioned by City Attorney Ken Dalsted. Jeff Fuchs, city administrator, said Tuesday BNSF had agreed to change two of those areas.

The first concession verifies the city will retain all its easements for underground public and private utilities should the railroad rescind the easements. In its original document BNSF specified a chain link fence separating the lots from the tracks. It has agreed to allow the city to substitute an historical decorative fence as its second concession.

"But not the third thing," Fuchs said. "So what they're saying here is they can get out of the agreement if they want to but we can't."

Despite that, the City Council unanimously approved entering into as easement agreement with BNSF.

The council also unanimously approved an agreement to close the Third Avenue West crossing as part of the deal with BNSF. In exchange BNSF is not requiring any payment for the property in the easement.

"They're two separate agreements, but they do go together," Fuchs said.

The cost of closing the Third Avenue crossing was included as part of the quiet zone package. However, BNSF wanted the crossing closed in exchange for the easements. Closing it was also a cheaper solution for the quiet zone.

"Keeping Third Avenue West open would just about have doubled the cost of the quiet zone project," said Councilman Ken Schulz.

The City Council also officially approved plans and specifications for the parking lot project and authorized bids for construction. Construction work on the parking lots is expected to begin in the spring.

The project includes realigning entrances and exits to serve quiet zone requirements. Parking will be diagonal with rows along the fence side, down the center of the lot and along the street side in the Gun and Reel and Schubert's lots. The evergreen trees now bordering the Gladstone Inn lot will be removed and the lot widened.

In other business, Mayor Clarice Liechty pulled the Allen Enterprises project off the consent agenda. Allen Enterprises is building a facility that will house Buffalo City Diesel. She questioned whether Kevin Thoele, the business' owner, who will be leasing the facility, would be financially able to handle the lease payments and a loan.

Allen Enterprises is requesting a state Flex PACE interest buy down of $75,000.

"There's not enough income to back up a loan," Liechty said.

She wanted to know who reviewed the financials at the Jamestown/Stutsman Development Corp. and what security position the JSDC held should Thoele default on the loan.

The PACE interest buy down funding pays the primary lender a portion of the interest as the borrower makes loan payments. It lowers the amount of interest the borrower has to pay.

"Unison Bank would not proceed unless it was satisfied," Schulz said of the primary lender.

Liechty voted against the project at the council's Finance and Legal Committee meeting two weeks ago. At the July council meeting, she pulled it off the consent agenda and voted against Allen Enterprises' purchase of two lots in the I-94 Business Park to build the facility. Then the mayor questioned the appropriateness of such a business in the business park, saying a diesel repair shop shouldn't be in the area. She questioned the covenants, landscaping and the site advisory committee at that meeting.

At the meeting Tuesday, Tom Merrick, the attorney for Dean Hafner and Allen Enterprises, presented a note to the mayor saying she had a conflict of interest. Crossroads Repair, another diesel repair shop in town, has a loan with the Liechtys.

"I had forgotten," she said and declared a conflict of interest. She was not allowed to vote.

After the unanimous vote approving the request, Liechty noted Councilman Pat Nygaard also had a conflict of interest as he works at Unison. No council members agreed with her.

Sun reporter Toni Pirkl can be reached at (701) 952-8453 or by e-mail at