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Home My WebLink About10.D.2. Approve Letter Requesting Mn/DOT to Sell Surplus Property to the City of Shakopee � � . �.J. � CITY OF SHAKOPEE Memorandum TO: Mayor & City Council Mark McNeill, City Administrator FROM: Bruce Loney, Public Works Director SUBJECT: Approval of Letter Requesting Mn/DOT to sell surplus property to the City of Shakopee. DATE: May 15, 2012 INTRODUCTION: With the recent approval of the Trunk Highway 169 and CR 69 Interchange moving into final design, there exists in the northeast quadrant, surplus right-of-way that Mn/DOT will no longer need and will be able to dispose of. The purpose of this agenda item is to see if the City Council is interested in purchasing the land and if so, the next step would be to send a letter to Mn/DOT requesting Mn/DOT sell the land to the City. BACKGROUND: With the Trunk Highway 169 Project in the mid 1990's, Mn/DOT did purchase additional right- of-way in the areas of CR 69 far a potential major interchange across the Minnesota River to Trunk Highway 4L With the Trunk Highway 41 EIS Study, the alignment that is being considered for Trunk Highway 41 Interchange is now further the west. Also, an interchange is being planned and in final design for Trunk Highway 169 and County Road 69. Thus the additional right-of-way purchased by Mn/DOT in the mid 90's will no longer be needed. This parcel that will be considered surplus is known as Parcel 43 in Mn/DOT Right-0f-Way Plat 70- 16. Attached is a letter from James Kirchner on December 15, 1998 which talks about the City purchasing some of that right-of-way for Vierling Drive and a pond near Taylor Street. The City has actually paid $115,000 to Mn/DOT for land associated with this parcel. Parcel 43 is approximately 23.3 acres and the initial purchase price that Mn/DOT paid for this land was $784,995.70. Price for this land is calculated at $33,690.80 per acre. This staff inember has recently met with Mn/DOT staff on the connection to Vierling Drive to CR 69 from Taylor Street and also on the disposition of surplus right-of-way in this area. From this meeting, Mn/DOT has concluded the next step in the disposition of right-of-way would be for the City of Shakopee to request a letter if they are interested in purchasing Parcel No. 43. The City obviously has interest in Parcel No. 43 purchase for the construction of Vierling Drive connection to CR 69. According to our Comprehensive Plan, this land is guided for Commercial Use and could be a potential commercial economic development project. Staff would recommend, if City Council is interested with this parcel to request a letter to Mn/DOT that the City would be interested in purchasing this parcel and at the price that Mn/DOT paid for it with the Trunk Highway 169 Project. Reason being is that Mn/DOT had initially indicated to sell this parcel to the City at that price and the Ciry has already paid $115,000 to Mn/DOT for land on this parcel. Question for Council is whether or not to proceed with the purchase of the entire parcel, in order to construct Vierling Drive to this parcel and then later to dispose of the property for future development. The other option would be to work with Mn/DOT in acquiring the right-of-way needed for Vierling Drive and have Mn/DOT sell the remaining parcels at a public bid. Staff recommendation would be to see if Mn/DOT would sell the parcel to the City for what they paid for it thus giving the City control in constructing Vierling Drive and approving the disposition of the remaining land through a request for proposal (RFP) process. The acquisition funds for this land could come from the Sanitary Sewer and Storm Drainage funds. Since both of those facilities are needed to construct Vierling Drive and for the development of the property. These funds would be reimbursed upon a resale of the property after Vierling Drive would be constructed. ALTERNATIVES: 1. Approve a letter requesting that Mn/DOT sell Parcel No. 43, which is PID 27-911026-0 at approximately 23.3 acres to the City of Shakopee in the amount of$669,995.70. 2. Do not approve a letter to Mn/DOT requesting sale of Parcel No. 43 at this time. 3. Table for additional information and direct this item to the Economic Development Advisory Committee (EDAC) for input. RECOMMENDATION: Staff would recommend Alternative No. 1 to send a letter to Mn/DOT requesting them to sell the property to the City at the price they paid for it. However, this is a Council policy decision as whether or not they wish to proceed in this fashion for economic development. The Council may want the EDAC to weigh in on the proposal before a final decision. ACTION REOUESTED: 1. Approve a letter requesting that Mn/DOT sell Parcel No. 43, PID 27-911026-0 at approximately 23.3 acres to the City of Shakopee in the amount of$669,995.70. Bruce Loney, P. . Public Works Director ENGR201?-PROIECTS ME�IOS ApprovalMn DOTletter ��Nr+ESOr� e o Minnesota Department._, fransportation : � �"ti,.oF��,Qff Metropolitan Division Waters Edge 1500 West County Road 62 Roseville, MN 55113 December 15 , 1998 Ms . Judy Cox City Clerk City of Shakopee 129 Holmes St . Shakopee, MN. 55379 SUBJECT : C. S . 7005 (101=187) 901 Scott County Parcel 43 ASSESSMENTS (For: 1997-1,Vierling Drive from Tay10-r Street to Presidential Lane;Taylor Street From Vierling Drive to the North Plat Line Of Arlington Ridge First Addition; and Polk Street, from Vierling Drive to 13t'' Avenue . Dear Ms . Cox: I am writing to inform you that Mn/DOT has no intention of paying the $81, 888 . 96 assessment which the City of Shakopee has levied for improvements constructed relative to the subject parcel . Mn/DOT and the City of Shakopee agreed that the subject parcel would be purchased by the City for the amount that Mn/DOT originally paid which was $784 , 995 . 70 . The City has made two payments amounting to $115, 000 to Mn/DOT. This leaves a balance of $669, 995 . 70 yet to be paid to Mn/DOT. Typically, Mn/DOT does not sell land by installment payments . This arrangement occurred in order to accommodate the City' s financial needs . Now, the arrangement has back-fired and Mn/DOT is supposed to bear the brunt of the situation. We still want to se11 the subject parcel to the City of Shakopee but may be forced to return the partial payments and sell the property by public bids . We are hopeful that any extreme measures can be avoided with regards to this matter. Mn/DOT is only asking to be dealt with fairly and we are confident that the City of Shakopee is willing to work this out amicably. Feel free to call me to discuss this matter at 651-582-1635 . Si cerely, s Kirchner Reconveyance Specialist cc :Bruce Loney - Shakopee City Engineer Ron Deusterman - Mn/DOT (C.O. ) An equal opportunity employer - 1 ;"w,..�..s:.... .,�,,-�:;a w-•_.:. �` _,.....� -�.... 1:.�7"_�._ » ,_.��...:. �.__ .e..._. ___ . _ • . . � i . � - • - :y` .... .i .. .. , . . ....r . . ...., .... .:. .. . � � �� i� '�' .:� �+.+k� .Y �w;��1r ,� . �� * . ��—�. 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