Southwest LRT: Conflict of Interest


The Minnehaha Creek Watershed District (MCWD) purchased 17 acres of land across the street from the proposed Southwest LRT station at Blake Road. The land deal was brokered in 2011 for $15 million for redevelopment investment, storm water storage and Minnehaha Creek restoration.

Normally the last process hurtle before shovels break the soil is a watershed district permit. Odds are the appointed MCWD Board of Managers would vote to permit SWLRT construction.

When developers take over a watershed the mandate to protect the water commons is compromised. When taxes were collected by appointed officials in colonial America people revolted.

When SWLRT opponent Bob Carney asked about interest payments on the $15 million taxpayer bond, managers skirted the question. Approximately $100,000 per year in interest payments would be expected.

Below are transcribed legal audio minutes of the May 8, 2014 regular meeting of the Minnehaha Creek Watershed District Board of Managers (appointed by Hennepin and Carver County commissioners).

The discussion centers on SWLRT and 17 acres at 325 Blake Road and West Lake Street, south of Knollwood Mall, in Hopkins, across the street from the proposed Blake SWLRT station. The station location is now part of a strip mall, just south of the railroad tracks and Pizza Luce at 210 North Blake Road.

The parcel includes a large cold food storage warehouse, and borders Minnehaha Creek and the Cedar Lake bike trail, which is next to the railroad tracks.

When Developers Take Over the Watershed

The players in this audio transcription of the May 8, 2014 regular MCWD board meeting include:
–Sherry Davis White, president, Orono, term expired 3/15 (wife of former Orono mayor, Jim White who organizes housing developments), reappointed until 3/18
–Brian Shekleton, vice president, St. Louis Park, term expires 3/16 (works for Hennepin County Commissioner Peter McLaughlin)
–Richard Miller, treasurer, Edina, 3/17 (former Wells Fargo employee who arranged bonding, government finance) Wells Fargo is financing the Blake Street bond purchase.
–Jeff Casale, secretary, Shorewood, 3/15 (realtor); Kurt Rogness of Minneapolis, architect, was appointed for a three-year term replacing Casale. Minor felony charges against Casale for using MCWD staff in his private real estate business were dropped because “the alleged embezzlement occurred outside the statute of limitations.”

Three managers were absent:
–Jim Calkins, Minnetonka, 3/16 (PhD, professor Horticultural Science UMN)
–Pamela Blixt, Minneapolis, 3/17 (MA public administration, City of Minneapolis emergency services)
–Bill Olson, Victoria, 3/16 (engineer Rockwell International)
All but one of the seven managers represents Minneapolis suburbs.


–Richard Miller “…the worst could be that LRT didn’t get approved…we’ve got to do a quiet plan if LRT doesn’t go through and it [the land] doesn’t have its commercial value at its highest and best use as a train station site….We’ve got to build in our budget someplace (for) the losses we’re going to absorb on disposing of that site, because we always know [sic] we’ve got more in it than we’ll get from it but the benefits of the [Minnehaha] creek frontage, and the [storm water] storage capacity, etc. you know it had certain value to us and so that could cover the, but you know, if we do have a problem in 2 or 3 years or 4 years you know let’s not have it in a situation where we’re in a disaster with no plan. And I don’t think it would take much of an effort to plan it out, you know, how we’re going to pay for the costs.”

[The bonding loan to be paid back with tax money comes due in 2017]

–James Wisker, MCWD staff Director of Planning, Projects and Land Conservation: “By the end of July we should have a lot more clarity…worst case scenario planning we should revisit like, July 24th by then all municipal consent should have occurred.”

[In a 6/16/14 email Wisker wrote to the author: “Regarding (SWLRT) dewatering. I referenced that there would be no system in place to perpetually dewater following construction completion.”]

–Richard Miller: “We can’t be naked when that $15 million comes due 2017….We’re planning for the best but we’re ready for the worst”.

–unidentified male voice: “When we started on this…we had very strong interest in senior housing…there’s no question it’s going to be more valuable with light rail…”

–Brian Shekleton: “And I will offer that light rail will happen…”
–Jeff Casale: [interrupts] “That’s going in the minutes I think.”
— [laugh]
–Brian Shekleton continues: “and by every indication I get that commitment from [Minneapolis] city council members.”

Jeff Casale: “If we’re going to have this on the record…disaster is nothing like I would have considered it as. I think the property has been improved significantly from the work that we’ve done surrounding it…whether or not LRT goes in that property will have significant real estate value and I would not characterize it at all as disaster planning.”

Richard Miller: “Well, you can call it what you want but it will be [a disaster] when the note comes due and we got a third of the value of the note.”

Is This What Corruption Looks Like?

· Who’s watching out for the water?
· Is this land purchase a “conflict of interest” for MCWD managers whose agency and political power would profit by voting to permit SWLRT?
· Is this taxation without representation?

It appears that citizens, not officials or paid experts or politicians or white suburban developers, care about the sustainability of keeping Minneapolis waters clean enough for human recreation.

The current SWLRT plan includes a half mile tunnel between Cedar, Lake of the Isles and Calhoun after approximately 44 acres of tree removal/land clearance. Solid steel walls would be sunken 55 feet down for the length of the tunnel to anchor the 35-foot by 30-foot waterproof train tunnel. Otherwise it would float up or down with fluctuating underground water levels.

According to the Burns and McDonnell Engineering Company water study for the Metropolitan Council, as much as 24,000 gallons per day from inside and around the tunnel would be pumped out. Less groundwater flow into and out of the lakes would allow more contaminants and particulate matter to fill in and remain in our public waters, our water commons.

Clearly the voting managers of a permitting agency should be leery of the appearance of conflict of interest regarding public money and political power.

The Minnehaha Creek Watershed District deciders have violated public trust with their ambitious financial scheme that supersedes the preservation and protection of the famous Minneapolis Chain of Lakes.