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City of Mitchell's Longhorn costs escalate

The view from the roof of the Veterans of Foreign Wars building looking toward the empty lot of the former Longhorn Bar in downtown Mitchell. (Sean Ryan/The Daily Republic)1 / 4
The interior, upper part of the Veterans of Foreign Wars building, which was located on the shared wall with the former Longhorn Bar in downtown Mitchell. (Sean Ryan/The Daily Republic)2 / 4
The Veterans of Foreign Wars building is fenced off on the south side where the Longhorn Bar in downtown Mitchell was located. (Sean Ryan/The Daily Republic)3 / 4
The Veterans of Foreign Wars building is fenced off on the south side where the Longhorn Bar in downtown Mitchell was located. (Sean Ryan/The Daily Republic)4 / 4

The total cost of resolving the ongoing situation at the old Longhorn Bar site could reach up to $500,000, Mitchell Mayor Ken Tracy has acknowledged.

In its latest action, the Mitchell City Council approved the purchase of the damaged Veterans of Foreign Wars building for $175,000 Tuesday night in the Council Chambers at City Hall. The VFW is directly north of where the old Longhorn was before its demolition. The final vote to purchase the VFW building -- rather than repair the VFW's unstable shared wall with the former Longhorn -- was 7-1 with councilman Dan Allen voting against it.

"I just think there's too much more money into this, a lot of money in this," Allen said. "This is a total waste of taxpayer money -- a total waste. That's what I hear everywhere I go. I say to get some bids -- the right bids -- put the wall up, and move on."

The council also approved a $31,257 change order from Ironman Construction, of Tyndall, for the Longhorn Bar demolition for additional work related to the unstable wall shared with the VFW, bringing the total contracted amount of the demolition to $173,973.48. The original bid was $109,559.

The $1 purchase of the Longhorn building and the new total contracted amount for its demolition, plus the purchase of the VFW building, brings the total bill of the project so far to $349,973.48. The cost of the VFW building's future demolition has not been determined, but Tracy estimated it could be $150,000. That would bring the total cost of the purchase and demolition of the Longhorn and VFW buildings to nearly $500,000.

"I'm not happy with having to spend that kind of taxpayer money to, in essence, get a couple of lots, and that's all we're getting out of them right now," Tracy said. "Overall, that's not a very good use for taxpayer money. We got put in a bad position. This definitely wasn't an amount we went in prepared to spend on this project."

Marvin Schuldt, a spokesman for the Mitchell VFW, said the businesses' monthly meeting is Tuesday, which is when members will vote on approving the building's sale to the city. According to the VFW's bylaws, the sale must pass a two-thirds majority vote among people who attend next week's meeting.

"This is a big decision and I want as many guys' input as possible," VFW Commander Pat Ziegler said.

The council voted 6-1 on first reading to acquire the VFW building for $175,000 at its last meeting Aug. 19. Allen was the only member to vote against it and Councilwoman Susan Tjarks was absent. Tuesday night was the second and final reading and vote.

The Longhorn -- the oldest known building in Mitchell -- was deemed unsafe after a wall collapse in November 2011. The city bought the southern downtown building from the owner for $1.

Demolition of the former Longhorn began May 14 but was halted two days later when it was discovered the building's shared wall with the VFW building was unstable. The VFW was forced to close for more than a month as a result of the situation and is in the process of relocating.

Longhorn owner faces council

Longhorn Bar owner Jason Bates, who moved his business across the street after selling the old building to the city, attended the meeting and was approved for a transfer of a retail on-off sale malt beverage license from Big Dummy's to 505 N. Main St., the site of the old Heng-Heng Chinese restaurant, which will become Aces & 8's Pub & Grub.

Bates said he has an on-off sale license he's paying for and not currently using, and he plans to use it at the new business.

Councilman Randy Doescher expressed his frustration toward Bates, saying he did not pay any money toward the demolition of the old Longhorn and the city has footed the entire bill.

"I will be voting against this," Doescher said. "If he has the money to expand, I feel he should have fulfilled the promises he made to the city council when we were going through the other issue. If you have the money to expand, why not pay some of it back? I know legally you're not forced to pay, but morally why wouldn't you?"

Bates said he almost went out of business because of the Longhorn situation. Bates and his father Robert Bates -- who signed over ownership of the bar to Jason Bates just weeks before the wall collapsed -- became involved in a lawsuit after their insurance company, LeMars Insurance Co., refused to pay to fix the damages because of the change in ownership.

According to court documents, the two sides reached an agreement and voluntarily dismissed the lawsuit in March. Bates said he came out with enough money to pay his lawyer and make minor repairs to his business.

"If I would have got it, you would have got it. I got hurt in this, too," he said. "It's not like I'm laughing to the bank."

Consent agenda

Council members, as part of a consent agenda:

• Approved the meeting agenda, council minutes from the prior meeting, planning commission minutes from July 22 and Aug. 12, and traffic commission minutes from Aug. 19.

• Approved an application by the Make-A-Wish Foundation of South Dakota for a special event malt beverage and wine license for Summer's Last Dance on Saturday at Hitchcock Park.

• Approved an application from the ParTee Bar for a special event liquor license for the Pheasants Forever Banquet Oct. 18 at the Corn Palace.

• Approved raffle requests from the Longfellow parent-teacher organization, with the drawing Sept. 21; the Mitchell Athletics Booster Club, with the drawing Sept. 21; the city Parks, Recreation and Forestry Department, Bella's Butterfly Garden, with the drawing Oct. 7; the L.B. Williams parent-teacher organization, with the drawing Oct. 12; the Mitchell High School cheerleaders, with the drawing at each home football and basketball game.

• Set a Sept. 16 date for a hearing on the application of the American Legion for a special event liquor license for an indoor rodeo event, Oct. 4-5, in the 600 block of North Main Street and the north City Hall parking lot.

• Approved an automatic supplement of $1,500 from donated funds to the Parks, Recreation and Forestry Department's special revenue fund for Bella's Butterfly Garden.

• Approved a change order from H&W Contracting for the Capital Street improvement project with no change in the contracted amount.

• Approved a list of pay estimates.

• Approved bills, payroll salary adjustments and new employee hires, and authorized the payment of recurring and other expenses in advance as approved by the finance officer.

Other business

In other scheduled business, council members:

• Sitting as the board of adjustment, set a Sept. 16 date for hearings on the applications of Troy Helleloid for a conditional-use permit to construct an accessory building across from 25 West Harmon Drive; and Rodney Klinger for a backyard variance of 17 feet rather than 25 feet for the installation of a roof overhang for an existing deck at 1411 Sharpstone Drive.

• Rejected a project to build storage sheds for the Mitchell School District to replace space that was removed during the construction of the second sheet of ice at the Mitchell Activities Center. In place of building outdoor sheds, the extra storage space will be inside the new arena.

• Approved a bid to Sheehan Mack for $519,175 for a landfill compactor project.

• Adopted a resolution to plat Lot 12, Block 9 of CJM Second Addition, in the northwest quarter of Section 32, Township 104 North, Range 60 West of the fifth P.M.

• Conducted and approved the first of two required readings of the annual appropriations ordinance -- the budget -- for 2014 with a total of $34.7 million, which is about a 2 percent increase from last year's $34 million budget.

• Conducted and approved the first of two required readings of an ordinance to supplement the health and welfare portion of the general fund with $175,000 from the general fund cash balance for demolition of the VFW building; and the Antach/Mitchell High School TIF portion of the capital projects fund with $66,000 from the general fund for infrastructure construction.

• Approved an agreement with Helms & Associates, of Aberdeen, for engineering services for the construction of a third cell at the city's landfill, at an estimated amount of $136,766.

• Approved a final financial closeout for the Mitchell Municipal Airport improvement project as prepared by Helms & Associates and authorized the mayor to sign final documentation.

• Approved an agreement with SEH Inc. for consulting services related to the Longhorn/VFW demolition, in an amount less than $8,450.

• Approved an agreement with the South Dakota Department of Transportation for state financial assistance for pavement maintenance at the Mitchell Municipal Airport.

• Tabled a request to conduct a lottery game of chance for the Mitchell Area Safehouse Foundation to be held Feb. 22.

• Approved a raffle Mitchell Skating and Hockey Association, with the drawing in February 2014.