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Council to apply for DEED funds

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Several motions on the fate of the proposed Wadena Regional Health and Wellness Center were approved by the city council during an hour-long special meeting Tuesday afternoon.

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The city plans to go ahead and apply for a piece of the $47.5 million pie, left up to the discretion of Minnesota Department of Employment and Economic Development (DEED), after local projects were cut from the 2012 bonding bill passed by the Legislature.

The council is hoping the odds may be in their favor: $125 million worth of local projects were cut from the bonding bill, more than twice of what is now available in the DEED fund.

"Anybody that's got a shovel-ready project will be applying I think," City Administrator Brad Swenson said. "If you take out just the projects that were not in the bonding bill that are similar to ours, there was St. Paul Regional Baseball Park, St. Cloud Civic Center, Mankato Civic Center, Minneapolis Nicollet Avenue rebuild, Minneapolis Sculpture Garden, Oakdale Veterans Memorial, Rochester Mayo Civic Center expansion, plus Wadena."

The people behind Wadena's project are asking for up to a tenth of the available DEED fund: about $4.75 million.

The council passed a motion to apply for up to $4.75 million, depending on what they can afford to match.

Council member Toby Pierce asked what the city would do if they received a smaller amount, such as $3 million, and attorney Luther Nervig said they should take it and run.

Swenson added that if the city applies and does not receive any funding from DEED, the community center organization could buy a fitness center building, originally meant for Otsego, Minn.

The $750,000 in planning money could not go toward the Otsego building unless the city takes ownership of it instead of the community center organization.

The DEED fund requires applicants to have "shovel-ready" projects, but with the destroyed former Leaf River Ag building still standing on the proposed wellness center site, it doesn't look ready, Nervig said.

The city has a purchase agreement with Leaf River Ag, which now has its main site at the southeast industrial park.

Swenson said he asked DEED if the $750,000 awarded to the city in planning money could go to pay for demolition of the old Leaf River Ag building, and the response was "absolutely not."

He said, however, that if they do receive DEED funding, the costs can be retroactively paid by that fund.

Swenson said it would cost about $50,000 to $75,000 for complete demolition, but taking out the building (not including the concrete at first) would be $12,000.

Mayor Wayne Wolden said that regardless of whether the city receives the DEED funding, there will be a new community center and the site is needed.

The council passed a motion to authorize Swenson to get writing that says demolition will be covered by DEED funds. Council members also motioned for the city to take ownership of the site in order to have the authority to carry out site demolition.

Additionally, the council approved sending a request for proposals to remove the building.

Another topic discussed was whether to continue paying for a lobbyist, now that the project is out of the Legislature's hands and into DEED.

The council approved $5,000 to go to more broadly defined "technical services," which could mean lobbying or grant writing or other similar outside help.

Council member Jeanette Baymler said the city was too far along not to hire a lobbyist.

Pierce said DEED probably can't be lobbied like the Legislature, and the mayor and city council members are the most effective lobbyists anyway.

Wolden said lobbying helped them get on two of the three proposed bonding bills, which Pierce said ultimately didn't do any good.

"You've played that tornado card over and over," Pierce said.

Wolden said they could set up a media event in the Twin Cities as they present the application.

Council member Don Niles said it was unfortunate Wadena was categorized with other projects that were not affected by a tornado.

Swenson said the length of the DEED application process was uncertain.

"We don't know if this grant is going to take a month or six months," he said.

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