Plainwell seeks loan to match cleanup grant
Plainwell has applied for a low-interest state loan of up to $600,000.
The money will be used as the city’s match for the $5.1 million federal grant Plainwell recently won to demolish several deteriorating buildings at the former Plainwell Paper mill site.
The project will demolish much of the western portion of buildings on the site, which have roofs collapsing and boiler systems with asbestos contamination.
Contract negotiations with the lowest qualified bidder are hopefully wrapping up soon, but city manager Erik Wilson said the project is still expected to cost approximately $5 million; the grant requires a 10-percent city match.
Wilson said the city was preapproved for the Brownfield Loan Application through the Michigan Department of Environment, Great Lakes, and Energy. The exact amount will be determined once the contracts were all in place, to be repaid over 15 years.
“So, we’ll be responsible for about $450,000 to $500,000,” he said. “The interest rate right now is about 1.5 percent. And there’s no interest or principal due for five years. We’re not going to be able to get a better deal than that.”
He said deadline for EGLE approving the loan is in August. He said that since the state had invited the city to apply after the pre-application process, it looked promising.
Wilson said work on the demolition project is required to begin by July 1.
“Once we get the buildings demolished, once the cleanup is done—which we anticipate by the end of this construction season—that vacant land and all the buildings are prime property to sell,” he said. “So that gets us a good cushion of time to get some taxable value on that—also the sale of property itself.”
Council members approved the loan application at their Tuesday, May 26, meeting.
“Depending how the development goes, the city could choose to begin repaying the loan immediately or take advantage of all or part of the five-year deferral,” he said. “Hopefully we will have exact figures soon.
“Approving the demolition contract will be placed before the city council once we are ready.
Wilson estimated the lowest bid for the demolition and cleanup project at $3.5 million, though some alternates the city is seeking, along with liability insurance, will likely push the project’s costs past $4.5 million.
He said he wasn’t concern about the remaining details being hammered out in the contract; the unknown that might hold up the project was related to the historic nature of the mill’s buildings.
Wilson said demolition required approval from the State Historic Preservation Office, and the city had been working with them for a year to gain approval. He said he had reached out to many organizations regarding the buildings, including 28 Native American tribes in the region. One in Wisconsin, he said, had expressed interest in signing onto the city memorandum of understanding with the State Historic Preservation Office.
“I’ve asked them if they had any issues; I haven’t heard back yet,” he said. “As of today, I’m not concerned. But we do have to start by July 1.”
“The city has done all of the work; there’s nothing more to do.”
Getting the state office to sign onto the memo is key since other portions of demolition work will be complicated by having to preserve other buildings.
“We know Indians had a big presence here,” Wilson said. “But the footprint of each building is not being excavated beyond what the mill already did.”
At a special meeting Friday, May 29, council members scheduled a public hearing during their June 22 meeting to consider next year’s budget.
Plainwell city clerk Brian Kelley said last week he was set to mail Absent Voter ballot applications to the permanent AV list on May 29.
“For anyone who’s not on that list, call us; we’re happy to get one out to you,” he said.
He also said nomination packets were available for those running for the two city council seats up for re-election. Packets are due back to city hall by July 21 at 4 p.m.
Expiring are the terms for Todd Overhuel and Lori Steele.
Overhuel said there would be an obvious difficulty gathering the 30 signatures amid the pandemic; “Because we can’t go door to door.”
Kelley said clerks had been given no official directive about how to advise candidates.
“The best we can do is to say to use your best judgement,” Kelley said. He suggested petition-signers use their own pens and possibly gloves while signing. He reminded candidates that part of the process required a notarized form.
Contact Ryan Lewis at Ryan.Lewis.Editor@gmail.com or (269) 673-5534.
Editor's note: This story contains details not included in the June 4, 2020, issue.