Mayor speaks out on Bull Moose legal action, responds to citizens’ concerns

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BY LINDA TREST
REPUBLICAN STAFF WRITERs

Gerald city officials have been cautioned to avoid speaking about a recent lawsuit filed against the city by Bull Moose Tube Co. (BMT). 

Some employees of BMT have not been under the same caution, speaking openly — and perhaps sometimes inaccurately -— about the situation. 

Several local business owners met with Gerald Mayor Cary Parker last Thursday. Ward 2 Alderman Tina Bauguess was also present. The group reported hearing that BMT was so unhappy with its treatment by the city, the company was leaving town. They urged the city officials to do what they could to keep the company from going elsewhere.

Parker said at that time he was unable to respond to their questions and comments with the facts of the matter. After speaking to the city’s lawyer, Steven Lucas, Friday, Parker has been advised to speak openly about the facts in an attempt to dispel misinformation pertaining to the lawsuit. Lucas is with the firm Cunningham, Vogel & Rost, P.C. While Lucas is assigned to be the city attorney for Gerald, any member of the firm is available to assist. One member of that firm is a financial specialist, familiar with industrial financing law.

In 1967, BMT signed a lease with the city of Gerald. They built a 100,000 square foot building on 11 acres of land owned by the city. BMT has been paying the city $4,600 per year to lease the land and the facility. The city’s position is that for almost 40 years, BMT has simply held over, or remained on the city’s property without a lease. 

On Feb. 27, the city was notified that BMT was seeking a declaratory judgement against the city. A declaratory judgement is the legal determination of a court that resolves legal uncertainty for the parties involved.

On Saturday, March 24, Parker granted an interview with The Republican. He laid out the following time-line of events:

On Dec. 28, the city sent a letter to BMT stating the leases had expired and would be renewed on new terms. The lease will increase to fair market value. A lease price using an estimate of fair market value would be set for both parcels.

• BMT responded that they believed the lease was current. They then sent a payment for $4,600 to the city. The city sent it back saying it was not the proper amount. 

On Feb. 14, BMT sent a letter stating they did not wish to renew lease, but would rather pursue a purchase of the facility to include land and building. They asked the city to work with them on Chapter 100 financing (Chapter 100 of the Revised Missouri Statutes deals with industrial development bonds). BMT further suggested that financing, improvements and legal fees would be paid by BMT at a price agreeable to both parties. 

• City attorneys called BMT to make sure both parties were talking about the same thing including an agreeable price. 

• BMT responded saying they were anticipating a sale price of around $3 million. 

Around Feb. 20, the city’s legal representatives suggested a phone conference. They told BMT it would not be a cheap process to move forward and BMT should begin to cover costs. BMT said that sounded reasonable to them. 

• Lucas called Parker Feb. 23 to bring him up to date. 

• With the legal deadline of Feb. 28 looming for the lease, Parker expressed concern that the city should reach out before then to make sure things were going smoothly. 

• The city’s attorneys called BMT’s attorney Feb. 27 to check on the status. The attorney would not take his call. A staff member told the city’s counsel that a lawsuit had been filed with BMT asking for a declaratory judgement.

It should be noted that since the city owns the land on which the BMT plant stands, and according to BMT’s attorneys, no property taxes have been paid by BMT. 

Using an online inflation calculator, it was determined that $4,600 in 1967 would be worth $34,292 in 2018. This only applies to the increased value of cash, it does not reflect the difference in value of industrial real estate from then until now. 

To sum up, Parker said, “Bull Moose took action which the city must defend and work for the best result for the city.”

 

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