For the past four years the city of Preston has had a land option with Bob Doherty for the 15 acres selected for the proposed state veterans home site, located just north of Preston, which will expire at the end of the month.

So, at its final February meeting, on Tuesday, Feb. 20, the Preston City Council settled in to discuss the details and logistics of the property.

At the last meeting, the council had concerns about purchasing the property until it knew if Preston would be awarded the project from a financial and engineering perspective.

City Attorney Dwight Luhmann shared he had spoken with Doherty about the future of the property.

“At the council's direction, I did contact Bob after our last meeting and he did indicate he hadn't really closed the door on extending the option,” Luhmann said. “I think he is like us and kind of frustrated with the uncertainty of not knowing. Where it sits is that we had talked about an additional year and the number he proposed was $15,000 and if we exercised the option, that would come off the purchase price.”

The option is to purchase the land at $14,000 an acre for a total of $210,000.

“I do like that option better than spending our money upfront and buying the property before we know,” said Mayor Kurt Reicks of the purchase option. “Hopefully, we're going to learn something with the legislation...they were here last week and were very receptive to what we were talking about. The next thing is deciding where in Fillmore County.”

The council voted to purchase the land option for one year at the cost of $15,000 with those funds to be taken off of the purchase price if the city exercised the option.

City staff will continue their work in determining the particulars of the site.

Crown Hill Cemetery

The Crown Hill Cemetery board approached the council last year asking for the city to consider taking over the role of conservator for the cemetery.

Public Works Director Jim Bakken shared his estimate for the annual maintenance of the cemetery.

The estimated annual cost includes $2,080 for mowing, $1,986 for trimming and $2,000 for snow removal, sanding and general maintenance.

Bakken suggested the city make a contribution in the annual budget for 10 percent of the cost of a new mower, an estimated $1,200, in preparation the purchase of a replacement.

“As for facilities, there is a small storage shed in the northeast corner of the property and then there is the mausoleum on the southwest corner,” Hoffman noted.

According to the board, the cemetery averages $2,500 per year in revenue, but board members stated it does receive a few memorials to help with the cost of maintenance.

If the council determined the city would take over the cemetery, Hoffman shared there were certain ways to make it happen.

“You could set an allocation and, if you wanted, you could create a cemetery committee or board to oversee it. You could set an allocation to that committee the way we do with other committees and they would most likely be reimbursing other city departments from that fund,” Hoffman explained. “I would say that if the council is interested in taking over the cemetery I think we need to start putting together a framework for how that would happen, both legally and how you would set up the cemetery board. I think the council would also want to have a conversation with the current cemetery board to gage their interest on serving on the board and to lay out the expectations of what the council envisions to do with the cemetery versus what the existing cemetery board envisions.”

Mayor Kurt Reicks suggested the city wait until later in the year to make the decision, so the city could work out the logistics and work it into next year's budget.

“I believe the founding fathers of this community began that cemetery up there with the thought that it was going be the place where the deceased were going to be placed,” council member Robert Maust commented.

Council members agreed they would like city staff to begin lining up the details and gathering more information, so the council could make a decision later in the year.

“It is definitely a project we need to get involved with,” council member Holly Zuck concluded.

Street project

With concerns over increases in the interest rates, the council reviewed the possibility of moving up a street project to 2019.

City Engineer Brett Grabau prepared a tentative schedule for a 2019 street project.

“We would meet with city staff this spring or summer and come back to the council with our project areas. I think we all know the large project area, but I think there are a handful of smaller project areas throughout town that deserve some discussion, too. We would come back to the council with those project areas and scope out and authorize a feasibility report to price those items out,” Grabau explained.

A public hearing would then be held around August for assessments.

Then with authorizations for the plans and specifications the design phase could begin.

Project bidding would take place in February with the bid being awarded in March.

Construction would then begin in late April or early May and be completed by the end of October.

“The impact of a project this size at this time, we are looking at a tax levy increase per year of $150,000. So that would be a 17 percent levy increase. That is nothing to joke about...that is a huge increase. It would push us into what would be classified as a high debt per capita city and it would push our tax levy to about the highest in the county,” Hoffman stated. “My quick figuring indicated we would need a 50 percent increase in our water rates for residential and commercial customers and a 31 percent increase in our sewer rates.”

Hoffman noted some of this could be eased by spreading the levy increases over many years and getting the bond for 20 years instead of 15 years.

Council members agreed they would like to have Grabau, along with city staff, determine possible project areas. These will be presented later this spring so the council can decide if they want a feasibility study completed.

Other business

• The council approved the conversion of the city's street lights to LEDs. The switch is expected to have a significant savings, which could possibly repay the upfront costs in just over two years. The total project is estimated at $100,000, but with a donation from Preston Public Utilities for $35,000 in labor and equipment, $33,000 in rebates from SMMPA, the remaining cost to the city would be $34,000.

• A resolution decertifying the tax increment financing (TIF) district 5, the Country Trails Inn and Suites site, was approved.

• The next meeting will be held on Monday, March 5, at 6 p.m.