Sale of Mississippi National Golf Course Challenged

A local group is challenging the City’s sale of Mississippi National Golf Course. They argue that 1.) the City needs legislative approval to sell the property, and 2.) that the property could only be sold by Initiative or Referendum, not by ordinance or resolution.  They also challenge the sale on the basis of a lack of a bidding process or advertising the sale.  Is the City walking into another lawsuit, or will it have to take a mulligan and start the process anew?  This is up for discussion at Monday’s Council meeting.

Here is the letter from the group to the City outlining their position and legal arguments.  The City Administrator’s memo to the Council regarding the sale is here.  Read the lease here.

Good Leases Gone Bad: Who is Running Your Golf Course?

You can also read about it in the Eagle here.

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6 Comments

Filed under Accountability, Minnesota, Red Wing, Red Wing City Council

6 responses to “Sale of Mississippi National Golf Course Challenged

  1. Charles

    The city council has issued its response and although it is recommended that no action be taken, the City of Red Wing (meaning the Council which is acting not on behalf of the citizenry) has already met with the sole “no-bid” buyer, who also happens to own a sweetheart 30 year-$1 per year lease on the links, plans to meet again with Mr. Pittenger & his banker in the coming week. The City, which has outright owned the land since 1976, has given Mr. Pittenger four phenomenally ridiculous leases since 1985 and know is in the unenviable position of owning valuable public property and beholden to sell it to one man, who holds all the cards. Well done, City Council, well done.

    Read for yourself the brilliance of the lease and wonder how a City can keep screwing itself time and time again. There is enormously valuable information being withheld from the public, who actually owns the land, and no recourse in which to halt such an egregious blundering by the City Council.

    http://156.99.117.8/weblink8/0/doc/49144/Page1.aspx

    This is not about a bunch of people who want the taxpayers of Red Wing to subsidize their golf course. This is about a town who 26 years ago voted to create a public entity for the recreation of all the citizens and visitors to our great city (not just for golf but recreation such as walking, hiking, and cross-country skiing). This is truly the people of Red Wing’s land. This is about an inept Council going out of its way to secretively strip Red Wing of one of its public assets after years and years of managing its asset to the tune of giving away all rights to revenue and agreeing to bankroll significant costs for the financial benefit of one man, that one man being the one who stands to gain all in this ill-advised sale. Once this PUBLIC LAND, bought by the citizens of Red Wing a quarter of a decade ago for the express purpose of the recreation of past, current, and future citizens becomes sold, it will NEVER, EVER become public again. This is a travesty beyond proportions. Of course, not everyone needs a golf course and of course not everyone uses the public land for recreational purposes but everyone in town owns the land and no one in town, save the shadowy City Council, is able to see the actual revenue stream from the golf course or is involved in the actual sale. Makes one wonder if the City Council is negligent, stupid, criminal, or doesn’t want its constituents to see how poorly and awfully it handles the town in which it is supposed to serve.

    No referendum, no obligation to the public, no answers and certainly no peek behind the curtain and this sale is set to be a done deal in “sixty-ninety” days. I, for one, am getting down to Council to voice opinion on Monday.

    Full disclosure, I am a relative of one who is fighting this but I have no real dog in the fight other than the simple truth of there is something being kept hidden for the public and that is simply wrong. This is how you want your town run?

    I know the truth in the matter. No one wants the citizens to pay for golfers or the golf course and no one wants the contentious overtones toward the former RWCC. Everyone just wants a say in rightfully what is theirs to opine about. We own the land. We are not beholden to people playing the people of Red Wing like suckers and a City Council representing us a town full of sheep ready to be shown as suckers because no one stood up and asked simple and easy questions and justly got simple and honest answers.

    Think of it…Four leases, $1 a year, new lease…$30,000 obligation over twenty years…no need to disclose to the public revenue on a city-owned golf course…a “no-bid”, desperate seller scenario (keep in mind they are in negotiations…which means the buyer holds the cards because who else would buy a property that someone owns a 30 year lease at $1 a year on…no one!)…

    Wouldn’t you like to be this person? Again, well done city…well done.

    • The appraisal has been shared with the buyer through his bank, so releasing the appraisal to the public would not give away any bargaining advantage. Legally, the City might not have to release the appraisal, but it appears they now could if they so desired.

  2. sue

    Can you expect integrity from a city council that has shown little interest in citizen input? Mentioned above, “City Council is negligent, stupid, criminal, or doesn’t want its constituents to see how poorly and awfully it handles the town in which it is supposed to serve” my opinion is all of the above. Do they have the right to sell the “people’s property” without public hearings, discussion or advertised bids? (I personally was never for subsidizing golfing but the details as presented above do merit question and concern.) When will the citizens awaken to egregious actions and take action? The citizens would be wise to seek council and form a watch dog group as we move forward through these terrible economic years. The citizens would also be wise to push for the ending of general fund subsidies, enabling the continued red ink of the Port and the Incinerator year after year.
    Thanks Kent as always great articles!

  3. Charles

    Some last minute number crunching for you all

    MNGL (Mississippi Nat’l GL)
    ratio of 1985 RW vote to build for vs. against—4:1
    number of leases drafted to Wendell Pittinger—4
    latest lease to WP—30 yr (2008-2038)
    rent owed to city by WP (from lease agreement, in years only)—$30
    rent owed to city by WP in 2009 (via 4% rent on capital improvements paid by taxpayers of RW)—$3,200 or $266.67/mth
    grand total owed to city by WP in 2008—$3201.00
    rent owed to city by WP from 2008-2028(via 20 year capital improvement budgeted rent from 2008-2028 & $1.00 yearly rent)—$31,153.00
    estimated extra revenue to city from MGNL inception 1985-2038—$0
    2009-2013 operational costs to RW on five year budget—$914,150
    budgeted labor costs (RW city jobs) on five year budget—$235,000
    percentage of labor costs on total five year budget—26%

    So, the big issue is, as I see it, a matter of two issues.
    1) Is MNGL subsidized by the city?
    2) Does the selling off of a dismally poorly run city asset to fix a short-term budget problem make sense?

    I will briefly tackle these questions.

    1) Yes, by all rights MNGL is subsidized by the city but only because of the repeated incompetency of the city council and the ineffective leadership put in place. In plain view, the city has all but gifted an out-of-town business owner a golf course. They have basically printed money for him and now to either bury their negligence and incompetence, they are selling valuable city assets with no say from its owners (the citizens). Mr. Pittinger no doubt is laughing his ass off all the way to the bank at what rubes the people of Red Wing have been and are. The city receives virtually no revenue from him (I pay more for a one bedroom apartment in rent than he does to run the course) and now is forcing a sale to the one man they are beholden to…Mr. Pittinger has all incentive to buy the course because no one in their right mind would buy his three years old, thirty year lease. Basically, Mr. Pittinger can either maintain his totally one-sided lease or keep the city on the defensive to lower the sale price…no loss either way to him. The city obviously has tipped its hand by its desperation to unload the course…nice negotiating point.

    So, the answer remains—yes, the city is subsidizing the course (rather stupidly) but is only doing so because it is giving away all its revenue earning potential to a private entity and then crying that it subsidizes the course and thus is forced to sell it because it is not essential. All the city had to do was have competent and interested CITIZENS of RW run the course as a non-profit city asset and jewel and it would most likely be a self-sustaining entity. Instead the city printed money to an out of town huckster and now stands at the brink of doling off city property to compound its own idiocy.

    2) Only time will tell because we cannot be sure what WP will do with the course when he owns it. The city will get a short-term fix but will never own that land again. The city most likely will receive the very least amount possible for the land and never once tried to actually gain any discernible revenue off one its nice assets.

    Again, the city either thinks its citizens are stupid and clueless or itself is indeed clueless and stupid. It will try to pin the course as a city-run and subsidized money gobbling behemoth and certainly point to the dollar figure after sale as evidence that the council “saved” the taxpayers of RW all this money but in effect it will be putting an unnecessary band-aid on a decades old wound for the showy effect of nothing, getting rid of a valuable town asset voted on by the citizens 4 to 1 a quarter century ago for what is surely bargain basement prices, and doom itself to repeat the amazing incompetence of its past to the future.

  4. Erik

    I am pleased as hell someone takes the time to blog about these small town proceedings, Kent. Nice to meet you tonight. Hope I did alright. One thing…I am not nearly that bad of a proofreader usually (alluding to my few gaffes in my previous statements) but I used my anonymity as a mask for my laziness in not self-editing. That was fun down at City Hall. I love a little civil disobedience.

    Sincerely,
    Erik C. Fridell

  5. sue

    How is it that the city can afford to purchase property (Steve Arnold Lake Street home, also the lots behind him for a road really to no-where other than future speculation and also land for a future fire station they cannot afford to build for decades), yet the city cannot afford to hang onto its green space? We can run a public owned Marina yet not a golf course? The Marina they will argue shows a profit but the leasing agreement for the golf course has proven its own demise. Perhaps the council should get out of land leasing if they are unable to assure the public gets a fair deal. Subsidizing Mr. Pittenger all these years and realizing no profits for the city should be proof in the pudding of this councils lack of ability to protect public interest. It seems the deal is all but done as they extended the bond payment to date the finalization of the deal.
    If they are in such a financial bind, why did they make these other land purchases this past year? Why did we give the Port a 400k loan? (On top of another general transfer?) They have industrial property they could sell as they really do not need to remain as land developers during these economic times and it appears they generally sell land for pennies on the dollar. Let them sell off the Port holdings and leave the green spaces for the future generations to enjoy. Let them end the dumping of public funds into these money pits, the port and incinerator year after year and they still can never dig themselves out of the fiscal hole. This council will put on a front of allowing the public opinion to be heard but as seen before, their decision has been made. As time is needed to execute the details of title for the two parcels transferred from the state, this would have already been a done deal behind closed doors. When do council members inject personal opinion over constituency opinion as was done. New council members hopefully will realize they were sent there to represent the people not their personal beliefs! (Ms. Rehder spoke stating she does not believe in public/private enterprise?) Hopefully Mr. Fridell with his legal experiences and the concerned citizens will find a method to sway this council to its senses. They seem to only act under pressure of potential law suits, let it occur! If we want change, we need to elect change, which is something the citizens need to realize.

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