A special meeting of the Council for the City of Crystal Falls was held in the Council Chamber of the City Hall on Monday, February 27, 2006 at 5:00 p.m. Central Time.

Present: Mayor Hendrickson, Councilors Heikkinen, Thrasher, Valesano and Stachowicz.

Absent: None

Also present were City Manager Nordeman, City Attorney Lawrence, and City Clerk/Treasurer Olson

Also present was a large contingent of over 50 citizens.

The purpose of this special meeting was to conduct a public hearing to listen to proposals from all parties interested in obtaining the Crystal Manor building, and further, said public hearing will be conducted pursuant to the requirements of City Ordinance No. 1.10 which dictates procedures for the conveyance of real property.

Mayor Hendrickson led all present in the Pledge of Allegiance.

Mayor Hendrickson moved the meeting into the Public Hearing at 5:03 p.m.

PUBLIC HEARING:

Representing the Iron County Housing Foundation (ICHF), Pat Coleman, President of U. P. Engineers, presented the plan of the ICHF to renovate the Crystal Manor building to be developed as 23 apartments for low income elderly. The plan called for 12 one bedroom and 11 two bedroom units. Coleman explained how a funding request is to be submitted to MSHDA’s Low Income Housing Tax Credit program for a tax exempt long term loan to fund the project. In addition, ICHF is requesting assistance from the City of Crystal Falls through an application for a Community Development Block Grant to be used to provide parking lot improvements for the project. The projected cost of this project is $2.6 million.

Steve Gagne, also representing ICHF, noted that in order to submit the application to MSHDA an "Option to Purchase Agreement" must be obtained from the City. He also noted the advantages of ICHF owning the building to include: local management of the building by an organization that has already proven itself in Iron County, reuse of both the Crystal Manor and the remainder of the Crystal Falls Hospital buildings, providing a needed service of low income housing for seniors and the disabled in the community.

There were no questions from the public regarding the ICHF presentation.

The City Council asked several questions which were answered by Mr. Coleman and Mr. Gagne.

Comments from the public regarding the ICHF project included support as the service was needed in the community. There was also opposition noting that the Crystal Manor is a historical building that the re-use of it should allow for all the people to enjoy.

Representing himself and other investors, Kirk Beauregard presented a proposal to renovate the Crystal Manor building into a restaurant/bar/coffee shop/banquet hall with condominiums on the upper floors. He advised that his plan calls for a contribution from the City in the amount of nearly a quarter million dollars (the demolition funds set aside by the County), some tax abatements for the condo owners, and also assistance from the City to obtain additional parking near the building. His total projected cost for this project is $1.7 million. He noted that the condos would sell for $110,000 - $130,000 with studios selling for about $75,000. Mr. Beauregard suggested the advantages of turning the building over to his project include: the development of a much needed banquet facility and restaurant in the downtown area of the City, the creation of additional tax revenues, the opening of the main floor areas of the building to the public, and the possible use of the lower floor area for additional retail shops.

There were many questions from the public regarding Mr. Beauregard’s proposal.

The City Council also asked several questions which were answered by Mr. Beauregard.

There were comments from the public supporting Mr. Beauregard’s proposal for the re-use of the Crystal Manor building, mostly surrounding the idea of public use of this historic facility. There were also public comments of opposition noting that the cost of the proposed condos seemed high and there were doubts as to whether the proposed operation of this facility would be viable.

Jeff Syrjanen commented that he thought both proposals were very good and with all the vacancies on the main street perhaps there may be a way to accommodate both projects.

Wendy Thrasher posed a question as to the ownership of the Crystal Manor building sighting that the Townships of Crystal Falls, Mansfield, and Hematite may all have an interest as they contributed to the purchase of the Crystal Manor from Lutheran Homes with millage dollars beginning in 1986. She went on to say that they all should have a say in the fate of the Crystal Manor building and it should be put to a vote of the people. Clerk Olson was asked to read minutes of a special meeting of the Council held on May 29, 1986. Councilor Thrasher read a document that had been prepared to the 1989 Michigan Municipal Achievement Awards Entry that supported the gist of the cooperative effort of the City and Townships in the purchase of the Crystal Manor.

Mike Koszyk called for a "Point of Order" noting that the issue of ownership was not on the agenda for this special meeting and therefore should not be a topic of discussion. Mayor Hendrickson concurred.

The Public Hearing was closed at 7:23 p.m.

(A transcript of the questions and answers for each of the above presentations has been compiled and is available upon request from the City Clerk’s office.)

Mayor Hendrickson advised that the Crystal Manor re-use would be further discussed at the next regular meeting of the City Council scheduled for Monday, March 13, 2006 at 5:00 p.m.

Councilor Heikkinen seconded by Councilor Stachowicz moved to adjourn this special meeting of the City Council. 

Motion carried.

Meeting adjourned at 7:26 p.m.