City approves voluntary foreclosure agreement

The city of Breckenridge holds a mortgage on the Stop ‘n’ Go property located at 308 North Fifth Street, owned by Stan Jacklitch, who has defaulted on the loan. The city has been reviewing its options as the mortgagee, a resolution states.

The city of Breckenridge has moved a step closer to taking ownership of the old Stop ’n’ Go property in order to redevelop it after the June 3 council meeting.

The city holds a mortgage on the property located at 308 North Fifth Street, owned by Stan Jacklitch, who has defaulted on the loan. The city has been reviewing its options as the mortgagee, a resolution states.

The Breckenridge Port Authority recommended to the council that the city should pursue a foreclosure action on the property to take ownership of it in order to redevelop it, close and/or remove underground fuel storage tanks and prepare the property to be sold to a developer.

By law, the city, as a mortgagee on the property, has the right to pursue a voluntary foreclosure action on it. As part of that voluntary foreclosure action, the city and Jacklitch must enter into an agreement for voluntary foreclosure on the mortage, the resolution states.

It was determined to be in the best interest of the city to foreclose on the property, and the council unanimously authorized the execution of an agreement for voluntary foreclosure on the mortgage with Jacklitch, after a motion by councilman Reed Johnson, seconded by councilman Jim Gill. Councilman Jason Butts was absent from the meeting.

A Phase I Environmental Site Assessment of the property was prepared for the city by West Central Environmental Consultants, Inc., of Morris, Minnesota. The property sits on less than one-third acre of land and has operated for a gas station for approximately 40-50 years, and has no history of auto repairs. There are three underground storage tanks, and the property is connected to municipal sewer and water services.

City staff interviewed by the consultants were unaware of any leaks, spills, known soil or groundwater contamination, dumping, landfilling or other environmental concerns associated with the property. Jacklitch purchased the property from Ellig Properties.

The consultants reviewed records from the Minnesota Pollution Control Agency and Minnesota Department of Agriculture databases for bulk chemical or petroleum storage, spills or releases associated with the property and surrounding area, the report states. The property was identified twice on the Petroleum Remediation Leak Site and Underground Tanks databases.

The Leak Site identifies a release of gasoline on the property on Sept. 25, 1989. Soil contamination was discovered during the removal of three 8,000-gallon underground storage tanks, which contained gasoline and kerosene. At that time, excavation for the new tanks continued and contaminated soil was stockpiled on site for disposal. During the investigation, approximately 290-cubic yards were excavated. A Correction Action Design was reviewed and completed and the site was closed April 1, 1991.

The second leak site was discovered on April 24, 1997 and closed on March 26, 1998. The store reported a release of approximately 2,600 gallons of gasoline on the property. A dike around the city broke and the extender pipe on the UST was broken off, displacing fuel by the flood waters.

Currently, there are listed two active 10,000-gallon gasoline tanks and one active 6,000-gallon alcohol blend tank at the property. The active tanks were installed in September 1989.

The report’s conclusions and recommendations state that because the underground tanks were installed in 1989, and the historical operation of the underground storage tank system on the property indicates the potential for release have occurred, it is considered a Recognized Environmental Condition, which is defined “as the presence or likely presence of any hazardous substances or petroleum products in, on, or at the property due to any release to the environment; under conditions indicative of a release to the environment or under conditions that pose a material threat of a future release to the environment.”

In other council action, a resolution was approved to update an agreement for Highway 75 maintenance between the city of Breckenridge and the state of Minnesota Department of Transportation. The compensation for the agreement is $9,151.76 for fiscal year 2020 and $9,426.32 for fiscal year 2021, which become effective on July 1, 2019.

The council passed a resolution approving a lime sludge disposal contract with Disposal Service, Inc., of Wahpeton. The company has had a contract with the city for the past 22 years for lime sludge removal, which results from the water softening process at the city’s water treatment plant. The costs per year for the first five years, March 2022 through February 2027, will be $36,700 and then be increased to $38,535 for the remaining five years, March 2027 through February 2032.

The council held the first reading to add Chapter 149 — Regulations of Water Usage During Deficiencies, to Ordinance No. 509. The ordinance establishes water conservation restrictions and the plan will be in effect at any time the governor declares by executive order a critical water deficiency, or the city’s mayor declares a local water emergency.

The next city council meeting will be at 5 p.m. Monday, June 17.


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