A disagreement between the city of Ramsey and its former development management consultant could have jeopardized the development of a McDonald’s restaurant and the SuperAmerica convenience station within the COR, but the two sides reached an agreement so that these projects can proceed.
City Administrator Kurt Ulrich said Landform placed a mechanic’s lien on the property, which would have prohibited the city from filing the final plat for the COR Two development.
The Ramsey Housing and Redevelopment Authority approved these land sales last October. McDonald’s is buying 1.36 acres for $470,000 and KONA Properties bought two sites totaling 2.73 acres for $1,309,000 for the SuperAmerica development.
Landform said it was still owed $34,732.25 for work done, which Ulrich said included engineering work, laying out the plats and surveying.
The two sides reached an agreement for Landform to be paid approximately $33,000, according to Ulrich. The authority unanimously approved the agreement May 28.
“A lot of stuff came here at the end. We’ve got bills a little later,” Councilmember Chris Riley said during the May 28 meeting. “This needs to be the end. We’re going to clear this up. I don’t want to hear more open bills. Negotiation is going to be over when we’re done with this.”
Landform President Darren Lazan took issue with this comment and with the general tone of the authority, and he raised these objections in a June 3 email to the city attorney, city administrator and a councilmember.
According to Lazan, of the 18 unpaid invoices for COR Two work, six are more than 200 days old. One was billed to the city 310 days ago. The newest invoice was 12 days old.
“The statement that this somehow equates to not having the best business practices on my part is absurd,” Lazan said in response to Riley’s comments that were aired on Quad Cities TV’s broadcast of the authority meeting.
“This statement is wholly inaccurate and damaging. The questionable practices clearly came in the neglect on the part of the HRA to resolve these invoices for over 300 days in some instances, and to force me to incur costs to use a lien in protecting my interests.”
When asked who authorized the work, Ulrich said, “I think most of it was implicitly authorized by the HRA through the platting process. All the work was necessary to get the project completed and the land platted and the road constructed, so there’s notso much disagreement on that.”
Ulrich told the authority that there is some discretion when it comes to how professional services are billed.
Councilmember Randy Backous said the city’s finance officer Diana Lund “just doesn’t cut checks without the proper approval.”
Ulrich said the city wanted to document all the approvals and there was not that proper documentation, but only verbal agreements.
“Our biggest bone of contention is that the work wasn’t authorized,” City Attorney Bill Goodrich told the authority. “There’s a lot of factual issues back and forth on that with previous city employees and with the contract and those would take some time to get done with preciseness.”
Lazan said the implication that he took advantage of simple city staff direction and ran up the bill is not accurate. He said the curb cuts and right of way configurations should have been reviewed by staff at the appropriate time during the design process and then included in the final plans.
They were not, so there was considerable cost to make major revisions to the final plans, he said.
The city’s two-year contract with Lazan to be its contracted development manager for the COR project ended March 31, but Landform had done some work for the city on the original COR 2010 contract as well as incentives, engineering contracts, plat work, soil analysis and work done on the city’s bid for the Veterans Administration clinic.
Since 2009 and up to March 31, the city had paid Landform about $1.45 million for all this work, Lund previously told ABC Newspapers.
Landform will continue to receive incentives for any development that takes place in the COR 15 months after its contract ended March 31, according to Hauthority attorney Tom Bray.
Ulrich said Landform is still doing work on the overall COR project, including an environmental and storm water management plan review.
Eric Hagen is at [email protected]