Colby City Council hears industrial park complaint

By Nathaniel Underwood

During their latest meeting, the Colby city council approved a developer’s agreement with ND Real Estate Holdings that will allow the company to begin development of the land in Colby’s industrial park. After receiving the offer to purchase the six lots available at their October meeting, the city drafted the agreement that would finalize the deal.

The company plans to put an office space for its trucking business on the land, with the potential of an addition of a shop in the future. The land was sold for $1 as an incentive to develop and increase its value, with the council deeming it more beneficial to the city to have the tax revenue from the development than trying to find a buyer who would pay the estimated $90,000 that the property is roughly worth.

While the decision was made to move forward with the deal with ND Real Estate Holdings, the council did hear from a representative of Kelley Supply, Inc., a business that borders the lots in question in the industrial park.

Greg Alberts, the representative from Kelley Supply, spoke during the meeting, stating that the business would have been interested in the available lots, as they had plans to expand soon as well, and voicing his opinion that the businesses nearby should have been better notified of the lots availability and that another entity was looking to enter the area.

Alberts stated that Kelley Supply will need to build a new office building in the near future and would probably need to expand its warehouse in the next five to six years. He also stated that the way their warehouse is set up, the expansion would need to be to the north, into the lots in question and that, because the office employees work closely with the warehouse, having the office in a separate location would not work. The business had been hoping to utilize the lots that ND Real Estate Holdings was looking to purchase for those purposes.

An initial conversation with the city last year regarding the land had both sides leaving with different expectations of what would be happening with the lots in the future.

“In July of 2022, we found out that the land within the industrial park was going back into a TIF district and we reached out to the city and had a conversation,” Alberts said. “That conversation was obviously not understood the same way. We thought the conversation led to ‘hey, if anyone else is coming to look at the land, please let us know, we have a need because we are growing.’” While Alberts believes that he communicated his interest in the land at the time, the city stated that they did not have any evidence that he had expressed that at the time.

“We don’t have any documentation that showed that he was interested in the lots,” Mayor James Schmidt explained to the council. “Normally that is all documented when we do phone calls like that.”

While the initial conversation between the city and Kelley Supply in 2022 was perhaps misunderstood, with Alberts having left believing that the city would contact him if there was any outside interest in the lots and the city not believing any such promise had been made, the question of why the company did not make their intentions more apparent at the time, or between now and then, was raised by the council.

“Why, back in July, did you not ask for a right of first refusal or an option to purchase those lots if you were serious about expanding to the north?” council member Todd Schmidt asked during the meeting.

Alberts noted that at the time he did not know everything that was involved in the process. He had worked with properties in another city’s TIF district and stated that the process there was more complicated.

“We probably spent over $100,000 before we put a shovel in the ground,” he said. “So I did not know it was not as involved as that. And at the time, the last couple years, trying to staff and recruit people, has been a challenge. So the timing was definitely not good to do that.”

Communication between the city and local property owners and businesses over such issues was also brought up by Alberts at the meeting.

“I think that the process that the TIF goes through and land goes through should be reviewed,” Alberts said. “I think the process is flawed; there needs to be involvement of land owners and businesses in the area. There needs to be some public comment and engagement.”

The city does have some processes already in place for communicating such information to the public.

“By law when we have a meeting, the purpose of the meeting has to be on the agenda,” Mayor Schmidt said. “And when we discussed those lots, it was on the agenda for both the council meeting and the city planning committee meeting before that. We post it here [at city hall], the paper gets a copy and it’s on our website.”

However, there was some thought that more could be done to adequately communicate with community members about such decisions.

“I do agree that TIF district projects should be discussed more in public,” council member Todd Schmidt said later. “A certain component has to be done in closed session, but once it’s time for the light of day, I agree with you that we should at least have a public hearing or something.”

With a deal for the lots practically done with ND Real Estate Holdings, the council generally felt that they could not go back on their mostly reached agreement with the company and voted unanimously to proceed with the deal. A motion to work with Kelley Supply to find a way to meet their expansion needs was also made following the decision, with the council offering up alternative lots that could potentially meet the business’s needs in the area.