WILLMAR -- The city of Willmar would reimburse the state $824,380 for its contribution toward buying 700 acres for the old airport, under an agreement recommended by the City Council's Finance Committee.
The agreement, if approved by the council next week, would end about a year-long discussion between the city and the Minnesota Department of Transportation's Department of Aeronautics.
A disagreement arose after the city made plans to redevelop the old airport into an industrial park after the new airport opens. The park will be developed and land will be sold to businesses that build at the former airport site.
The city at first believed it should not be required to reimburse the state for its costs. The state felt it should be reimbursed for the investment it had made in the old airport. The city had tried to get legislative relief from making the reimbursement, but the bill was not well received at a Senate committee hearing, said City Administrator Michael Schmit.
The dispute ended after representatives from the Department of Aeronautics and city officials met recently in Willmar and came to an agreement, Schmit explained.
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In an April 4 letter to the Department of Aeronautics, Schmit offered with conditions to reimburse the state the appraised value of $824,380. The conditions included reserving the right to audit all parcels to determine the state's role and financial participation at the time of purchase.
Also, the city will make payments as land is sold. If the entire amount is not reimbursed within three years of the closure of the old airport, the city will divide the outstanding balance into five equal annual payments.
The state's acceptance of the city's offer was stated in an April 18 letter to Schmit from Aeronautics Office Director Raymond Rought.
Committee Chairman Denis Anderson said he knew the city was having some issues and concerns with the state, but he said he didn't remember if the City Council gave any action or directive as to how the amount should be handled.
Schmit said that when the issue was discussed, the decision was made to pursue legislative recourse for relief. "We did that, and it is my considered opinion that that was not a viable option,'' he said.
The agreement has helped improve the city's formerly sour relationship with the Department of Aeronautics, Schmit said.
"It's important as we move to the new airport and grow and prosper out there (that) it will be to our advantage to have a good working relationship with Aeronautics,'' he said.
