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Bemidji City Council denies Paul Bunyan Transit request to waive fees

The Bemidji City Council's moratorium on donations or contributions to area nonprofits apparently remains in place.

The council voted 4-2 Monday night against a motion that would have approved a fee discount for Paul Bunyan Transit, a nonprofit that offers community transportation.

Paul Bunyan Transit, which is in the process of building a new bus garage, had asked the city to consider waiving sewer and water connection (SAC/WAC) fees for the new building.

The organization is expected to face more than $15,000 in SAC/WAC fees, according to council documents.

Paul Bunyan Transit was not asking the city to waive all of the fees, but to waive a portion of them, said Greg Liedl, who serves on the board of directors for Paul Bunyan Transit.

When asked if the nonprofit had a specific amount in mind, Liedl said no.

"I guess we were going to leave that up to the council," he said. "Anything would help us."

The cost for the sewer connection fees are expected to be $4,780 and the water connection fees are expected to be $10,350.

Liedl noted that Paul Bunyan Transit has not asked for a local contribution toward the project, which has been funded through grant dollars and reserve funds.

The request from Paul Bunyan Transit follows the council's vote in June to waive 10 percent of SAC/WAC and building permit fees for Pine haven Townhomes, a proposed low- and moderate-income development. The total amount waived was $8,389, which included portions of both SAC/WAC and building permit fees.

During one of the discussions on the matter, Councilor Greg Negard, who also serves as the executive director for Paul Bunyan Transit, said the townhome project is a for-profit venture and there is no guarantee it could be sold for a profit in the future.

He said then that he could "guarantee" that if the fees are waived for Pine Haven, Paul Bunyan Transit's board of directors would ask for a fee waiver also.

"We are a nonprofit, but unlike the low-cost housing project (for which) the council granted a reduction in fees, Paul Bunyan Transit will never be sold, nor will anyone profit from any reduction or waiving of these fees," he wrote in a July 15 letter to the council.

Negard attended this week's City Council meeting but excused himself from council discussion regarding Paul Bunyan Transit's request; he also abstained from the vote.

The crux of the issue is, apparently, a moratorium on donations or contributions to area nonprofits that was approved in 2004 and affirmed in 2008.

Exceptions are sometimes made, such as the discount in fees for Pine Haven Townhomes. The council also waived building permit and SAC/WAC fees for the construction of Village of Hope, a new homeless shelter.

Paul Bunyan Transit was asking for a similar discount.

'These are services that the city needs," said Councilor Kevin Waldhausen, who voted in favor of the fee discount.

But others felt that approval would open the door to even more requests.

"You're going to have every group back in front of us," said Councilor Roger Hellquist. "I really think this is a bad precedent to set."

Councilor Jerry Downs said he believed the council already had changed course with its vote on the townhome project.

Mayor Richard Lehman said he believed that project was different because the break in fees was offered as a means to obtain grant funding toward the construction of a low-income housing project, a need the city has struggled to meet in the past.

"They're filling a need in our community and they needed our assistance in applying for a grant," he said.

He further stated that Pine Ridge Townhomes, if constructed, would eventually bring in taxes for city revenue while nonprofit groups such as Paul Bunyan Transit would not.