State gets Vermilion deed

Updated:

Don’t pitch your tent just yet at Lake Vermilion State Park, and don’t even think about driving that motorhome to a campground there, but state officials say activity will pick up this summer now that Minnesota owns the land.

Gov. Tim Pawlenty signed an agreement Tuesday to pay U.S. Steel $18 million for 3,000 acres along Lake Vermilion in northeastern Minnesota. Joining Pawlenty at the state Capitol signing was Vice President John Goodish of U.S. Steel, who handed over the deed to the land.

"This will be a magnet for Minnesotans and others," Pawlenty said, estimating that tens of thousands of visitors will head to the new park annually.

Those visitors will have to wait. Natural Resources Commissioner Mark Holsten said that some public tours will be conducted in the park this summer, and limited trails and primitive camping should be available this fall. Boaters already may explore the lakeshore.

But don’t count on a campground to handle recreational vehicles soon. Facilities such as a visitors’ center and campground must await completion of a master plan and funds appropriated by the Legislature.

There are no roads into the park’s interior and little infrastructure beyond one highway that slices across its edge.

Development of the park could take more than a decade, Pawlenty said, and just what amenities will be provided remains in question. A task force is to make recommendations by year’s end.

The state has just $2 million for initial development. Part of the park’s opposition came from critics who said that $20 million to $40 million would be needed to develop the park, and that money is not available. Holsten said that development cost is not known, but estimated it could be $30 million.

The Department of Natural Resources’ first job is to make sure the new park is safe for visitors. Also, the department is looking for cultural and other historic areas that need to be preserved.

Holsten said Native American artifacts have been found and the department plans to work with Bois Forte Band of Chippewa on preserving them. The commissioner said there is evidence of American Indian use of the area long ago, and more recent European mining activities.

Archeologists and other experts are examining the new parkland.

Pawlenty, who said the park will be one of the most beautiful in the country, first proposed it in 2007.

The governor said there are few lands left, at least of the size of the new park, so it was important to snatch up the property.

Since lake lots and existing homes costs so much, fewer Minnesotans can afford "the up north" lakeside experience, Pawlenty said. With Lake Vermilion park, lake access will remain available to most Minnesotans, he added.

The new park is near the Boundary Waters Canoe Area in Superior National Forest.

The park almost did not happen. The state and the steel company haggled over the price in extended negotiations and U.S. Steel was ready to sell off the land for private development, including home lots.

Goodish said that in the long run U.S. Steel could have made more money selling the land for homes.

The land includes five miles of shoreline. The new park will be administered along with adjoining Soudan Underground Mine State Park, with another five miles of lake front property.

A criticism brought up by Rep. Tom Rukavina, DFL-Virginia, was that Soudan already is on Vermilion and it under used. However, Holsten said the Soudan park is oriented toward the historic underground mine, a different mission than the Vermilion park.

Holsten said he could not estimate how much the park will cost to run; that will be determined by facilities the state provides. However, he said, modern technology should mean the park will be less costly than the state’s most expensive one, Itasca, which costs $2.5 million a year to operate, although both should attract about the same number of visitors.

Some Lake Vermilion facts, from the Department of Natural Resources:

  • 39,271 acres of lake surface.
  • 368 islands.
  • 76-foot maximum depth.
  • 340 miles of shoreline.
  • 83 percent of shoreline privately owned.
  • U.S. Steel owned property 128 years.
  • Oldest rocks in park are 2.7 billion years old.
  • Largest muskie found in recent sampling was 54.7 inches.

Pawlenty, Goodish

Two parks, one management

Once Vermilion State Park opens it would be managed with the next-door Soudan Underground Mine State Park as if the two were one park under bills in the Legislature.

Senators tentatively passed their bill on a voice vote Thursday.

The bill also increases state payments to St. Louis County by $90 million as compensation for removing the land from property taxes.
 

No Vermilion park?

Sen. Tom Bakk says that despite Gov. Tim Pawlenty’s strong support, the future of Vermilion State Park is dim.

"I’m very doubtful that it ever is going to be a state park," the Cook Democrat told a Senate environment committee Tuesday.

One of his main concerns is the need to spend $20 million to $40 million to develop Vermilion park, along a lake by that name.

Even so, the committee unanimously passed a Bakk bill giving Pawlenty permission to buy the land for $20 million. The same provision is contained in a public works funding bill also making its way through the Legislature.

Pawlenty has put a high priority on Vermilion, which adjoins the existing Soudan Underground Mine State Park.

Bob Meier of the Department of Natural Resources told the committee that the Soudan and Vermilion parks would be operated as one unit, even if they remain separate parks.

The bill also allows local governments to get state payments to replace property taxes that they would have received.

Rukavina challenges Vermilion

Rep. Tom Rukavina this morning ripped a plan to establish Minnesota’s largest state park along Lake Vermilion, calling it "fool’s gold."

Soudan Underground Mine State Park already provides 15 miles of shore line along the lake, Rukavina said, and the state has done nothing to develop it for use.

"In these tough times when we are going to have to negotiate with the governor, why are we spending $20 million to add 5 more miles of shoreline next to the state park?" the Virginia Democrat asked. "This doesn’t make sense."

Rukavina estimated that it would cost $50 million to provide basic infrastructure, including a road.

Gov. Tim Pawlenty last week announced that he wanted to spend more on buying 3,000 acres for the park than the Legislature authorized two years ago. Rukavina and others promise a fight.

Minnesota would pay landowner U.S. Steel $18 million to buy the land, which Pawlenty says is among the most beautiful of any state park.

"We look at this as a huge opportunity for the state," said Bob Meier of the Department of Natural Resources.

Rukavina disagreed: "That land is not worth that. That land cannot be developed. Basically, they snookered you."

Pawlenty bonding bill well under DFL plan

Pawlenty

Gov. Tim Pawlenty wants to spend $315 million less to build and repair facilities around Minnesota than legislative leaders want.

Republican Pawlenty this morning said he hopes lawmakers approve $685 million in public works spending, to be repaid by general tax dollars, while Democratic-Farmer-Labor party legislative leaders prefer spending about $1 billion.

"You have got to be willing to say, ‘No,’" Pawlenty said.

Public colleges and universities would get the biggest chunk of money, 30 percent, mostly for fixing existing facilities. That is $245 million.

Helping Red River Valley communities that were flooded last year, as well as preparing for a flood diversion project, would amount to $50 million under Pawlenty’s plan.

While not part of his proposal today, the governor also announced that the state has reached a deal to buy land along Vermilion Lake in northeastern Minnesota for a new state park.

Lawmakers already approved the funds, but the deal to buy land from U.S. Steel came in above a state appraisal, which he said means the Legislature must approve the $18 million purchase price before the stay may proceed. State law limits land purchases to near an appraised amount.

Pawlenty would not say how much the state’s appraisal listed as a fair selling price, but said the deal was reached for a price between what the state wanted to pay and U.S. Steel wanted.

The governor said if lawmakers do not approve his request to spend the money, U.S. Steel will begin developing the land for housing this summer.

While Pawlenty lists some specific projects in the proposal he released today, much of the money would go to general categories, where state agencies can decide exactly where it is spent. For instance, the Minnesota State Colleges and Universities system would receive $50 million for repairs. Lawmakers will not approve specific projects, but MnSCU will divide it up.

In every even-numbered year, legislators give priority to funding public works projects around the state, ranging from new state buildings to repairing existing ones to buying land for parks. These projects are funded by the state selling bonds, much like taking out a loan, and repaying them over a period of years with interest.

More than $3 billion of public works requests were presented to the Pawlenty administration and legislators, and some still are coming in as the legislative session years.

In each public works bill, much of the bonding money goes to public colleges and universities.

The bonding debate in many ways is separate from the state budget debate, which also will be a key issue when legislators meet for their 2010 session beginning Feb. 4. But Pawlenty said repaying for public works project does affect the state budget, giving that as a reason he kept his proposal lower than DFL lawmakers.

House bonding Chairwoman Alice Hausman, DFL-St. Paul, compared bonding to a family buying a house with a long-term mortgage. The projects that are to last years are repaid while they are being used. Most of the state budget, meanwhile, is spent for salaries, utilities and other needs that are not appropriate for borrowed money.

Pawlenty often opposes larger bonding bills, saying he wants to keep the state’s bond payments low. He has vetoed several projects over the years. In his announcement, the governor said he could veto the entire bill instead of individual projects of lawmakers want to spend too much.

Hausman said interest payments for a $1 billion bonding will would cost the state $21.5 million in the fiscal year beginning July 1 and $9.7 million the following year. After that, interest payments would top $20 million a year for the 20910 bonding bill.

For the next few years, interest payments would be nearly 3.5 percent of the state’s budget if a $1 billion bonding bill were enacted.

The Legislature passed bonding bills in 2006 and 2008 in the $1 billion vicinity.

Pawlenty does not approve of what are known as local projects, items such as helping build a city’s event center. None were in his 2010 proposal.

However, Hausman said, projects in regional centers help a large number of people and help bring jobs.

"It is in our best interest to have strong regional economies," she said

The Republican governor cited economists who say that each job created by a bonding project costs the state $100,000.

Costs are down now, Hausman said, because contractors have cut their prices just to stay in business during rough economic times. That makes this a good time to build and repair, she added.

Vermilion park talks could resume

Talks to launch a Lake Vermilion state park are on hold, the state natural resources commissioner told a legislative committee this afternoon.

But Commissioner Mark Holsten said he wants $20 million set aside for land purchase to remain available.

"We are involved in a very delicate business discussion with U.S. Steel," he said. "The timing has to be right for the two parties to be involved in a business transaction."

Gov. Tim Pawlenty made it a priority to establish a Lake Vermilion state park in northeastern Minnesota. U.S. Steel appeared ready to sell off the land it owns for private development, but Holsten said talks may resume.

One factor in the negotiations’ suspension is that one part of the Department of Natural Resources is in the midst of making regulatory decisions on a U.S. Steel facility while another part of the department is trying to buy 2,500 acres from the company for the park.