Supervisors approve corrections to rail spur agreement

The supervisors approved some revisions to a financial support agreement between the City of Red Oak and the county as well as a revised memorandum of understanding regarding the Burlington Northern Santa Fe rail spur and its ownership by the Montgomery County Development Corporation.  
The supervisors approved earlier drafts of the resolution and memorandum at the meeting July 5. Supervisors Chair Mike Olson said the revisions were necessary due to incomplete information.
“When the resolution got to Recorder Carleen Bruning, she stated there was only one legal description when there should be more. We ended up at County Attorney Drew Swanson’s office and looked over the quit claim deed that includes a short description of each parcel of land with a reference number of where it is,”  Olson said.
Supervisor Donna Robinson asked if it had been determined what line item in the budget was going to be used to provide the funding for the rail spur repairs and maintenance.
Olson clarified the money would be paid from the $30,000 budgeted annually for the Montgomery County Development Corporation. Robinson asked what the next step would be.
“Once we pay out the $18,000 and subtract it from the $30,000, are we going to pay more later? I felt like the representatives felt that the money was going to be in addition to the annual $30,000 in funding,” commented Robinson.
Supervisor Charla Schmid agreed with Robinson’s statement, saying she felt that the $18,000 request was on top of the budgeted $30,000.
Olson said based on the way things were presented, it was understood the money would come out of the $30,000 arrangement with nothing added.
“I think as we move forward, if we decide to reimburse them for some of the funds we’re now allocating for repairs, that would be up to the board of supervisors to decide later to approve that or not,” explained Olson.
Supervisor Mark Peterson read out the portion of the ordinance which stated where the rail spur funding was coming from.
“Montgomery County has allocated a $30,000 investment to MCDC for FY 2023-24 for economic development grants. Montgomery County may allocate additional funds towards civic programs offered by MCDC. Montgomery County may allocate up to $18,000 for FY 2023-24 in support of MCDC taking ownership and completing repairs of the Burnlington Northern Santa Fe rail spur. Based on that, I would say that Mike is right. It’s up to us if we allocate more funding or not,” advised Peterson.
MCDC executive director Steve Adams said while it wasn’t their preference to take away from the existing budget,  if that’s all the county could afford, the terms were agreeable.
“We feel it’s that important that we acquire the spur, with the hope that once we sell the joint land we own with the Red Oak Chamber and the Red Oak Industrial Association that we would back fill whatever monies we lost out of the $30,000 that was allocated,” Adams said. “That $60,000 between the City of Red Oak and the county really goes to underwrite and subsidize my salary, so I may be cutting my nose off to spite my face, but I think we need the rail spur no matter what the cost. If I’m working for free at the end of the year, I guess I’m working for free.”
The revised resolution and memorandum was approved by a 4-1 vote, with Robinson again voting no. Robinson felt there was still too much of a gray area for her to vote yes.
At the Supervisors meeting July 18, the supervisors approved an additional legal description correction on the memorandum of understanding. The correction was unanimously approved.