City EDA declines request to lower property purchase price

Worthington City Hall
Worthington City Hall. (Brian Korthals/Daily Globe)

WORTHINGTON — The sale price of a property west of U.S. 59 north of Interstate 90 will remain the same as a result of action taken Monday night by the Worthington Economic Development Authority.

HHS, LLC petitioned the EDA for a reduction in the $1.31-per-square-foot sale price of a 1.106-acre lot it intends to purchase from the EDA to construct a commercial building to house a hog slat retail facility. The request was a result of what a company representative referred to as an “extensive delay we have faced trying to close on this property.”

Worthington Assistant City Administrator/Economic Development Director Jason Brisson told EDA members Monday night that errors had been made when subdividing the site on which HHS’s desired property is located. He also reminded the EDA that an interior portion of the lot was already sold for $1.15 per square foot, with HHS intending to develop subdivided land that remained after the sale.

“They (HHS) requested to buy something that didn’t exist,” Worthington City Administrator Steve Robinson added. “We had to create what they wanted to buy, so that, in itself, resulted in time and money.”

Brisson said HHS also asked the EDA for a forgiveness of assessments pending on the property in lieu of a price reduction.


“I don’t think we want to go down that route,” Brisson said.

Another option presented by HHS was a 20% reduction on the purchase price “to accommodate for the added costs of the project,” an HHS email to Brisson said. Increasing costs for building materials and the need to take out an owner’s policy for title insurance were cited as new expenses resulting from the delay, with HHS noting a planned closing date of July 15 or before following a Jan. 13 EDA decision to sell a subdivided portion of the lot.

“If the EDA were to reduce the amount, I’d recommend no less than $1.15 per square foot,” said Brisson, reiterating the sale cost of the other property at the site. A full 20% reduction, he indicated, would result in a per-square-foot cost below $1.15.

EDA members agreed that the city incurred costs in subdividing the lot for HHS and that, as a result, shouldn’t get a more attractive deal.

“I would hate for them to walk away from this project,” said Worthington Mayor Mike Kuhle, who acts as the EDA president.

EDA and Worthington City Council member Alan Oberloh expressed his confidence that HHS would continue to pursue development at the site. In moving to keep the sale price at $1.31 per square foot (for a total of $63,112.34), he asked that HHS receive as thorough of an explanation as possible on the costs the city incurred preparing the site for sale and why the company’s request for a reduced price was denied.

Oberloh’s motion was ultimately passed unanimously.


Ryan McGaughey arrived in Worthington in April 2001 as sports editor of The Daily Globe, and first joined Forum Communications Co. upon his hiring as a sports reporter at The Dickinson (North Dakota) Press in November 1998. McGaughey became news editor in Worthington in November 2002 and editor in August 2006.
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