Council votes to acquire 14 tax-forfeited properties

Published 2:50 pm Tuesday, August 10, 2021

The Albert Lea City Council on Monday approved the acquisition of 14 tax-forfeited properties in the city in an attempt to either correct blight or preserve affordable housing.

The properties were the following:

  • 1039 S. Broadway Ave.
  • 610 E. Fourth St.
  • 313 E. Eighth St.
  • 728 S. Newton Ave.
  • 322 Vine Ave.
  • 122 Euclid Ave
  • 938 Jefferson Ave.
  • Merricks
  • 601 W. Main St. – Merricks
  • 620 Adams Ave. – Merricks
  • 1207 S. Newton Ave.
  • 1209 S. Newton Ave.
  • 1211 S. Newton Ave.
  • 324 S. Broadway Ave.

Albert Lea City Manager Ian Rigg said with properties that contain structures that are too far past rehabilitation, the buildings will likely be demolished. For properties that can be rehabilitated with rehab such as a new foundation or roof, the city will rehab those properties if the city’s loss would be less than or equal to what it would have spent on demolition costs. He noted the repairs the city is focusing on are mainly to keep the houses stable and weather-tight.

After the repairs are made, the city will turn the properties back over to the private market and sell the properties at fair market value. At that time, a developer could do further updates, such as painting, flooring, kitchen or other updates.

In a letter to Freeborn County about the city’s plans, Rigg said the properties to be rehabilitated will not be completed at a profit, and any properties that were on the tax forfeiture list that were believed to leave room for profit in the private market were not part of the effort.

Rigg said the city will weigh the cost of rehabilitation with the cost of demolition, and if the rehabilitation cost is higher, then it would not move forward with the rehab.

The city manager noted that blight control and increasing affordable housing options in the community are two of the reasons the county is allowed to sell property to the city at less than fair market value. The goal is to eventually get the properties back on to the tax rolls.

The letter stated the city planned to clean up the Merricks properties to leave open for some type of public park space. Merricks reportedly went bankrupt, and had not paid its taxes. The properties are near the former Union Pacific Railroad line that the county and city hopes to turn into a new trail that extends up to Hartland.

Properties at 1207 S. Newton Ave., 1209 S. Newton Ave. and 1211 S. Newton Ave. do not have structures on them and would be considered for possible affordable housing developments with private developers. 

First Ward Councilor Rich Murray said he thought it made sense to do some kind of public/private partnership and take some of the money that would have been used to knock the houses down and instead stabilize them and put the properties back into the market.

Third Ward Councilor Jason Howland said while he hesitates any time the city is discussing getting into the real estate business, he also understands there is a housing shortage in the city and if there’s an opportunity to rehabilitate some of the houses, he is in favor.

In other action, the council:

• Accepted $1.85 million in Coronavirus Local Fiscal Recovery Fund money under the American Rescue Plan Act.

Rigg said staff is reviewing options for the funds and will present a plan to the council at a later date.

• Approved the emergency abatement of structures at 318 E. Eighth St.

The southern structure at the property was a total loss after a fire in June, and the front building had been placarded since 2019 because of structural issues.

Renters at the house next door wrote in a letter about the foul smells coming out of the burned structure and how living next door had impacted their lives. They said they have also questioned the safety of the structures. 

City inspector Wayne Sorensen said birds were flying in and out of the front of the house, there were problems with the house’s foundation and there was black mold and water damage, among other concerns.

Owner Donald Swartz described the concerns in the north structure as “minor at best” and spoke out against it being torn down. He said he had spent most of last year in the hospital, and began work on getting the building into compliance months before, although he had not felt he received a reasonable explanation as to what was needed from the city.

Second Ward Councilor Larry Baker said the cost of the repairs would far exceed the value of the existing structure.

Sixth Ward Councilor Al “Minnow” Brooks said the council had looked at similar situations in the past and given property owners time to fix up properties, only for them to come back and say they weren’t able to get the projects done and the projects getting pushed back further.

• Approved the purchase of four new vehicles for the Albert Lea Police Department at $45,000 each plus an Apex Officer Training Simulator for $47,500.

Rigg said due to anticipated production delays, he hoped if the department ordered the vehicles this year, they would arrive in 2022.                                                                                                                                                                                                                                

• Approved the purchase of a drone for the police and fire departments for $13,000.

• Accepted a $1,000 donation from Union Pacific Railroad to be used toward the purchase of the drone.

• Authorized an agreement with Linga Properties LLC, doing business as Freeborn Suites, for $2,443 in South Broadway Urban Renewal Grant funds to go toward new gutters, downspouts and signage.

The grant allows funds up to 50% of the total cost.

• Approved a variance in setback requirements for resident Ron Boelter for a retaining wall.

• Granted a variance for resident Lynn Kelly for a new horse-shoe shaped driveway and exceed requirements for impervious surface.

• Tabled a vote on deferred assessments at 77783 209th St.