Split Council Now Leaning in Favor of Moving Lakeville's Senior Center

Two months ago, the Lakeville City Council set a target date of July 1 to place the city’s vacant police station up for sale. But if upcoming votes follow the discussion lines evident at the council’s work session Monday evening, it will be the city’s current senior center that will be getting the ‘For Sale’ sign out front.

An overflow conference room crowd prompted the work session discussions on the fate of the vacant police station and senior center to be moved into the City Council chambers. Following a report by parks and recreation director Steve Michaud, the council continued their debate on the pros and cons of relocating the senior center and historical society to the vacant police station. During their April 25 work session, for such a move so they could better weigh their options.

Michaud presented financing plans and results from community forums and surveys regarding the issue. A number of new developments since the April 25 work session have shown promising potential in the ability to close an approximate $300,000 funding gap that made some council members leery of the plan. Significant questions still surround the project and the council remains split, but the motions to approve the hiring of an architect and construction management company, placing the senior center up for sale and engaging in active fundraising appear headed for majority approval based on Monday evenings spirited discussions.

Financing

Under the revised plan, the estimated $1.12 million project would be funded as follows:

The City of Lakeville would provide $377,000 from their building fund and $150,000 from their park dedication fund. According to Michaud’s report, those funds are derived from non-tax revenues such as the sale of city assets and park fees collected from new developments.

The sale of the senior center would net approximately $155,000. Though appraised at $345,000, the facility was originally financed with a Community Development Block Grant (CDBG) of $189,750 which would have to be repaid to the Dakota County CDA.

A CDBG of $249,750 would in turn be used comprising the returned $189,750 with the addition of $60,000 already awarded for upgrades of the current senior center that could be transferred to the police station building. The new CDBG is possible as long as 51 percent of the new senior center members meet low to moderate income guidelines. Michaud said the current survey results show that approximately 64 percent of the current members meet that qualification.

The Lakeville Senior Organization will contribute $100,000 in current funds to the project.

Fundraising initiatives will make up the remaining $88,000 needed for the project.

The Yellow Ribbon organization, a non-profit group dedicated to helping veterans with services after they return home, has agreed to partner with the facility by purchasing the commercial kitchen needed for the facility at a cost of $27,000. The organization would also utilize portions of the building and provide ongoing help with maintenance and fundraising efforts.

The remaining $61,000 in funds would need to come from community fund-raising efforts which Michaud could include a partnership with Auction Masters, an online auction website that has run previous city property auctions. Michaud said they were looking into the possibility of citizens donating items to a dedicated auction that would be used for fundraising efforts.

“They’ve (Auction Masters) never done that before but they’re very excited about the possibility,” said Michaud. “It could open up a whole new market for them.”

Michaud also said he has received plenty of response from interested donors.

“We’ve already received donations from citizens for approximately $16,000,” said Michaud. “I think that’s pretty incredible.” Michaud said that donation has only been pledged and wasn’t included in his report figures pending approval.

Operating Costs

The move to the new facility would result in an approximately $38,000 increase in annual operating costs for the two organizations. That deficit would be made up from increased membership dues and ongoing fundraising efforts in addition to the Yellow Ribbon’s contributions for use of the facility. It is anticipated that rental income from use of the facility by outside groups would also help make up that difference.

Offer Already on the Table for Senior Center

During discussions, city administrator Steve Meilke revealed that the city has already been approached by a business expressing interest in acquiring the current senior center building for the appraised value of $345,000.

“We haven’t even advertised yet,” said Meilke. “It’s nice to get interest at that value, but it may be worth more than that.”

Meilke said the business did offer a letter of intent to purchase the building, but that offer was declined pending further review. He referred to the city’s sale of their former liquor store building on Cedar Avenue that resulted in a bidding war and fetching a price much higher than the appraised value.

The current senior center location could accommodate a number of different types of businesses such as offices, but not retail, according to current zoning. It’s not clear which business or what type of business offered the letter of intent, but timing of possession would also have to be factored in to any agreement to avoid a gap in senior services.

Meilke recommended the city handle the marketing and sale of the facility internally.

Mixed Council Reaction

“I think $88,000 is very realistic,” said council member Kerrin Swecker, who was originally skeptical of the $300,000 shortfall and expressed her desire to place one of the buildings up for sale by July. “I think you’ll exceed that.”

Swecker said it was “the right place and the right time” to move ahead with renovation plans and moving those organizations into the facility.

Council member Laurie Rieb also said she supported the proposal.

“I think it’s very doable,” she said. “I’m in favor of moving forward."

But doable didn’t win accolades from Mayor Mark Bellow who has been a vocal proponent of utilizing the estimated $1.6 million asset for debt reduction or other purposes while seeking a “paradigm shift” in how the city provides senior services to a growing demographic.

“There’s nothing new here,” said Bellows. “This is the current senior center times two. I want a senior center that Lakeville is going to be proud of, not just an old paradigm of the past.”

Council member Colleen Ratzlaff Labeau was also hesitant. “I want to make sure it’s the right place,” she said. “It’s important to have a senior center, I just want to make sure we’re making the right move and that we have room for growth.”

Bellows has sought concrete answers to specific questions regarding the proposal and has sought guarantees that the city wouldn’t be left on the hook to provide additional funding should the current senior center not sell or additional costs could not be met.

He has challenged the council and community to envision a different type of senior activities program, perhaps spread around existing facilities such as churches and the new senior housing facilities.

“I still have a number of reservations,” said Bellows. “I’m not sure how to move forward. The whole issue has become a cause and not a plan.”

Bellows said too many potentials exist that haven’t been satisfactorily met in order for him to be able to support the plan.

“We have to take the next steps in order to answer some of those (questions),” said council member Matt Little. “There’s always a calculated risk.”

Little said he was ready to move forward with transitioning the two organizations to the police station. “Seniors are not sardines,” he said.

“I think we’re stepping out in the air with both feet,” said Bellows. “This standard is not the quality I envisioned.”

After some public comments were made, Bellows addressed the large crowd that had gathered in the council chambers to learn of the senior center’s fate.

“Folks, we live in a community where a school levy was turned down and there is a moderately hostile environment toward government spending,” Bellows said. “We are a city with $90 million of indebtedness and I do want you to understand, I’m not opposed to a senior center, I just think that this is a substandard plan that we have.”

But despite the objections, the Mayor also conceded that there appeared to be enough support on the council to move forward.

The issue is expected to be placed on an upcoming agenda for formal action.