Marathon City objects to the Post Services’ lease offer

By Kevin O’Brien

Marathon City’s new village administrator says he needs to have a “friendly conversation” with the local postmaster about a number of issues, including a proposed lease agreement that would stick the village with a $6,100 bill for negotiating fees.

At the village board’s Dec. 6 meeting, Steve Cherek told trustees that a real estate broker working on behalf of the U.S. Postal Service (USPS) has presented the village with a five-year contract to continue renting a portion of the village hall building on Walnut Street for its local post office.

The proposed lease renewal includes a provision that would require the village to pay a 4 percent commission to the brokerage firm of Jones Lang LaSalle (LLS) to negotiate the lease terms on behalf of both parties, Cherek said.

“Already we’re off on the wrong foot,” said village president Kurt Handrick.

The broker’s commission is not included in the village’s current five-year lease agreement, Cherek noted.

According to a 2022 letter to the village, the USPS signed a nationwide contract with LLS in 2017 to provide real estate services for all of its facilities. The $6,100 fee represents a 4 percent commission on five years worth of rent.

Cherek said he noticed several errors in the first draft of the lease, so he questioned the USPS, which corrected the mistakes but did not remove the $6,100 commission. His next step was to speak with the village’s attorney, who identified

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several other provisions that are “not in the village’s best interest.”

“There’s definitely some legal things to sort out,” Cherek said.

The village is currently paid $28,417 per year for the USPS to run its operations within 2,815 square feet of the village hall building. Under the proposed renewal, the USPS offers to pay the village $30,500 annually for five years, with no scheduled increases and an opt-out provision only available to the USPS, Cherek said.

“That’s well below market value,” Handrick said. “Most of the commercial property in this area is going for anywhere from $20 a square foot up to $32 a square foot.”

Before signing a new lease agreement, Cherek said he would also like to make it clear that the USPS is responsible for maintaining items within its portion of the building. He said the USPS has asked the village to repeatedly fix a drinking fountain at the post office and replace a loading dock lift control, which has broken several times, possibly due to misuse.

Trustee Keith Paul suggested that Cherek reach out to surrounding municipalities who rent space to the USPS to find out what they’re getting paid under their lease agreements. He predicted that the USPS would be “hard-pressed” to find another space to rent within the village.

The new lease agreement isn’t scheduled to take effect until November of 2025, so the village and the USPS have almost two years to negotiate the new terms, but village officials already agree that paying the broker’s commission is not going to fly.

“If they choose to have a private contractor doing their negotiation, I think that bill falls on them,” Handrick said.

When asked for a comment, a communications specialist for the USPS said the “USPS does not comment publicly on its facility lease agreements.”

Ballpark update

Cherek updated trustees on Phase 1 of the ballpark project, which has been expanded to include a third field, fully funded by donations, that is slated to open in 2025.

In August, the board awarded $1.1 million worth of bids to contractors to do earthwork, landscaping, and installing equipment, fences and other infrastructure for two ballfields. This work is considered Phase 1A of the project, part of which will be rebid to accommodate the additional field. Bidding has started for Phase 1B, which will include pouring concrete and constructing a concourse building with a concession stand and press box.

Cherek said full completion of Phase 1 is expected by the end of 2024, with games expected to start during the spring of 2025. The village is budgeting between $3.7 and $3.8 million for the two-phase project, with $1.25 million received so far, and the remainder to be received as grant or donation reimbursements once the work is completed.

“It’s really coming together quite nice,” he said.

Other business

n Cherek told the board that a medical company is interested in possibly purchasing half of the 400 block within the village’s TIF district number 2. He said the potential development is still in the “very early stages,” but the company feels like it would be a “great spot” for their facility.

n Cherek told trustees that paving for the North Ridge Road project is scheduled for next spring, and in the meantime, the village is working to address concerns from residents about the current condition of the roadway. n The board approved a utility easement on a parcel of property owned by Herman Hilmerhausen, where water and sewer lines will be installed for the northern business park.

n The board approved the hiring of Jasmin Gonzalez Mujica as first responder for the village’s ambulance service.

n The board approved the following poll workers for the next two-year election cycle: Georgine Bloom, Bonnie Schult, Michelle Juehlke, Duane Handrick, David Tylinski, Bruce Bohr, Genevieve Kramer, Alice Tylinski, David Martin, Candance Bahr, Barb Parlier, Dennis Cramer, Dan Parlier and Greg Szymanski.

n The board approved a certified survey map of .44 acres sold to the village by Gary Semerau earlier this year. The outlot will be converted to roadway to accommodate a retention pond required by the Wisconsin DNR as part of development plan for the new north business park.

n The board took no action on a proposal to pay trustees to attend meetings outside the village. Trustee Paul first brought up the idea after he went to several township meetings in order to discuss the village’s new fire protection contracts. He also argued that trustees’ salaries need to stay “competitive” in order to attract the next generation of village officials.

Under state law, any changes to elected officials’ pay rates don’t take effect until after the official has gone through an election. Trustees agreed to continue discussing the issue in 2024, with any possible raises taking effects as part of the 2025 budget.

n The board met in closed session to discuss negotiations regarding the village’s 2024 fire protection contracts and development in TIF 2. No major action was taken.