Gimse: Agreement reached with bank on loans, taxes now paid on development project land
WILLMAR -- Gimse Brothers Inc., the land development and construction company co-owned by State Sen. Joe Gimse, has reached an agreement with the local bank that sued Gimse and his brother for defaulting on their business loans.
Gimse, R-Willmar, said Friday that the matter with North American State Bank had been resolved and an agreement between the parties was signed on Sept. 1. The civil case, brought by the bank a year ago, is still scheduled for a pre-trial hearing Monday before Judge Michael J. Thompson in Kandiyohi County District Court. A trial date remains on the court calendar for Nov. 30.
"All the pieces of the agreement are coming together," Gimse said, declining to address specific details of the agreement. He added that he and his brother Gerald have been through difficult times and worked hard to resolve the situation.
"My brother and I have been through very tough times in this economy, especially the housing economy," he said.
North American State Bank filed the civil lawsuit in August 2009 and claimed that the Gimse brothers had defaulted on their business loans and mortgages on land in the City Heights addition, which is east of Willmar along the Highway 23/71 bypass. The suit said Gimse Brothers owed the bank a total of $597,001.77 plus late charges, collection costs and attorney fees.
The amount owed at that point included $176,027.08 on a $175,814.05 mortgage executed in February 2007 and $354,611.44 on a $347,000 mortgage executed in June 2008. The suit also stated that property taxes for 2008 and 2009 totaling $11,833.66 had not been paid and that failure to pay property taxes was a default on the mortgages.
The suit also included a $50,000 promissory note also executed in June 2008 on the land, and the amount owed was $46,143.99 in principal, interest, fees and late charges. The unpaid property taxes were $6,123.34. Also included in the suit were approximately $56,000 in notes on a vehicle, inventory, accounts and equipment.
Todd Kleinhuizen, attorney for North American State Bank, declined to comment when contacted Friday.
Part of the agreement was that the bank would pay the taxes on more than 25 parcels of land in the City Heights development. According to online property tax records for Kandiyohi County, North American State Bank paid $5,637.92 in taxes and penalties on the parcels on Sept. 15.
Gimse said he and his brother continue to work in the construction industry and work every day. "We've made some of the same types of tough decisions that families across the state have had to make."