Could Merrill have a new Center for the Arts?
Artists eye the former American Legion building; City relinquishing interest in property is key
TINA L. SCOTT
Jonathan Malm and a group of area artists [most of whom prefer to remain anonymous at this time] are hoping to purchase and restore the former American Legion building. And to create and develop a new Center for the Arts in Merrill that will benefit both the local community and be an attraction to draw people to Merrill.
Located directly across from the T.B. Scott Library on the south side of West First Street/Highway 64, between the tennis courts and Stange’s Kitchenette Park, with frontage on the Prairie River, the building is currently owned by the Merrill Historical Society (MHS). They’ve been using the building for storage. But soon, after they’ve finished moving their collections to their recently completed storage facility on East Third Street, they will no longer have a use for the building.
Malm made an offer to purchase the property and now has a signed agreement with the MHS to purchase the building and land, at an agreed-upon price. “The proposed sale is an agreement to purchase the building entered into with Jon Malm who has drafted a use agreement for a Community Arts Center,” said Pat Burg, Treasurer, and Bea Lebal, President, of the MHS in a joint statement.
Proposed use – a new Center for the Arts in Merrill?
Malm and other area artists would like to see the building’s history preserved and its artistry expanded, to serve as a Community Center for the Arts. The end result would be an attraction for the Merrill community and an avenue for local artists of all kinds and in all genres to come together to be creative and explore what creativity really means.
Jonathan Malm’s mother, Marie (Semling) Malm, fostered creativity in her children, and it’s a gift he wants to live on. “My mom and her involvement with the arts is a large part of the inspiration to do this,” he said. “She was a high school level teacher of music and arts at the Holy Cross High School for Girls and also one of the founding members of the Merrill Concert Association.”
Himself an artist in various genres, he said, “I do kind of have that artistic thing in my blood.”
But the Center would be about so much more than just art. He wants the focus to be on developing creativity in all areas of life. For instance, how a person solves the problems they encounter in business or daily life involves creativity, Malm said. It’s about so much more than what most people think of as art, and creativity.
The Merrill Historical Society wholeheartedly supports the proposed development. In a July 6 letter to the City and the City’s Aldermen, President Bea Lebal wrote: “Since 2018 the Board has received several soft offers, but no agreements were reached. We now have a generous offer from Jon Malm and other artists to purchase and preserve the historic integrity of this building while working to offer Merrill an Arts Center.”
“Located near the T.B. Scott Library, the Merrill Historical Society, and Prairie River Middle School, this facility would become the focal point of an Arts Neighborhood,” she wrote. “The neighborhood concept would afford our already rich local artistic talent additional opportunities, and programs of this type have proven to attract new artists from throughout the region which would expand the arts community here in our city.”
“Economically,” she continued, “it would benefit our local businesses and bring more awareness of our community.”
Unfortunately, in this case, such a sale isn’t quite that simple.
When the MHS purchased the former American Legion Building from the Edward Burns Post #46 of the American Legion in 1999, it was with an unusual stipulation. The agreement included a “reversionary clause” whereby, if MHS no longer used or occupied the property, ownership of the property would revert to the City of Merrill, and along with it, any improvements MHS had made.
History of the property
“In 1929 when the American Legion was looking to build a headquarters, the City Council gave land adjacent to Kitchenette Park to the American Legion with the restrictions that they build within one year or the land would revert to the City. They [the American Legion] managed to raise funds and completed the Legion [building] within the year,” MHS research showed. “There was also a covenant placed on the [quit claim] deed that if the American Legion Edward Burns Post vacated the building, it and all improvements would become the property of the City.”
In 1991, “the American Legion was looking at possibly selling to the Jaycees.” Burg said. While that sale never took place, in preparation for such a sale, “That was when the City lifted the reversionary clause – July 19, 1991, to sell to a fraternal, benevolent, or other like non-profit,” Burg said. But, as mentioned, that sale never materialized.
Then in 1999, the MHS proposed to purchase the American Legion building and property for use as a storage facility, because the American Legion “no longer had a use for the building and could not maintain it.”
“The MHS approached their [the American Legion] leadership and made an offer of $20,000 to purchase the building,” MHS said.
“The American Legion went to the City Council, per the deed covenant, and received permission to sell the building to MHS and keep the money from the sale.” The City Council, however, reinstated the reversionary clause when the American Legion sold to the MHS.
Merrill City Council Resolution 1571 in 1999 approved the American Legion sale of the property to the MHS subject to conditions that, in the event MHS cease to use the property or building, “the Property and any improvements thereon revert to the City of Merrill’s ownership” and “the conditions under which the City of Merrill took original title to the property not be violated by the transfer of the Property.”
The MHS reported that, over the 21 years that they’ve owned the property, they “put on two new roofs, purchased a new furnace, removed the bars, booths, bathrooms, etc., to make room for storage, boarded up lower windows to keep light from getting to the artifacts, installed and maintained a security system,” and “in 2019 the furnace had a major repair and cleaning during the winter.”
In regard to the current condition of the property, “The roofs, etc. are stable at this time. We believe the structure of the building is solid. The Board has directed that maintenance of this building continue as long as the HS owns the facility,” MHS said.
“The Society’s investment in this building, including purchase price, is approximately $58,000,” MHS reports.
MHS asks City to lift reversionary clause, and to let them keep the proceeds
The City’s willingness to lift the reversionary clause in 1991 suggested the City might be willing to do that again. “Which is why we thought we would be able to sell to another non-profit in the future,” Burg said.
Now the MHS is asking the City to lift the reversionary clause again and permanently, to allow them to sell the property to Malm, unencumbered, for development as a Community Arts Center.
“The MHS Board thinks that our objective regarding the former American Legion Building is the same as the City’s – to preserve this building and give it a useful community purpose again,” said Burg and Lebal.
“We strongly believe that the removal of the reversionary clause on the deed to the American Legion is the only way to find a new owner and preserve this building. The Society has asked the Common Council to take action on this and allow us to move forward with the sale to Jon Malm,” they said.
“The City has had NO EXPENSE to the property since 1929,” MHS said. And that “Past practice is the American Legion was authorized to sell the building to MHS and KEEP the compensation paid by us of $20,000. They did not list the building, but came forward with a buyer.”
“When purchased, the MHS had no reason not to expect the same courtesy from future Councils regarding compensation for our care and maintenance of the building. We have found [sic] also found a buyer, just as the American Legion had,” MHS said.
The Board of Public Works initial consideration
At the June 23, 2021, City of Merrill Board of Public Works meeting, the Board considered the MHS request to amend Resolution 1571 of March 9, 1999, to relinquish/extinguish their reversionary clause and the rights contained therein to enable the MHS to sell the property.
During the public comments section of the meeting, Alderman Steve Hass spoke, saying, “The City of Merrill I’m hoping will retain the American Legion Building as in Resolution 1571. The City generously donates to the Historical Society every budget, and the improvements made to this building by the Historical Society … is a far cry from what they would pay to rent a storage facility for these items. We need to run the City as a business and not give away land with buildings.”
Ryan Schwartzman, Bea Lebal, Pat Burg, and Harry Wallace, all spoke in favor of the City eliminating the reversionary clause and/or giving MHS the proceeds from the sale, at least to reimburse for their $57,000-$58,000 in expenses during their period of ownership.
Schwartzmann also questioned what the City would do with the property if the proposed sale didn’t go through.
Lebal asked the Board to give serious consideration to the MHS request saying that, although the City does contribute to them each year, she felt they also contribute a lot to the City by making it an attractive place to live.
And Burg spoke expressing appreciation for the money they receive annually from the City to help with their operating budget, which is about 1/8 of their annual budget.
She also pointed out that the MHS “recently completed a $1.5 million addition to save the Bethlehem Church property that we’re on and also our storage facility is running about $700,000. The City has no buy-in for any of that brick and mortar that we have in our buildings, so we appreciate the stipend that we get. It really helps us with operating money. Raising money for buildings is kind of a different animal, but we thankfully have a lot of support in the community, and I think that shows what they think of the Historical Society.”
“In terms of the [Legion] Building,” Burg said, “… The American Legion also was given the opportunity by the Council to retain the money from the sale of the building, so the American Legion sold it to us for $20,000, and the Council allowed them to make that sale and keep the money.”
“The last thing I’ll say is the reversionary clause is certainly a detriment to selling the building,” she said. A potential seller “is not going to come into that building and think it a good deal to have the City in the background saying, we can take everything that you put into this building and the land. So if you put improvements in the building – and our buyer would probably have to invest about $150,000 to $200,000 in that building – and then if the City left an original clause on such as we’re under right now, they would have to, in turn, when they vacated it, possibly turn that over, and that would, I think, hamstring anybody who was looking at purchasing the building.”
Proposed purchaser, Jonathan Malm, agreed. Though he was not at the Board of Public Works meeting, he said later: “There are several reasons the reversionary clause needs to be eliminated. It prohibits realistic financing of the property along with renovation and improvement costs. Long term investing by anybody will not be practical nor prudent.”
“The overall plan is to preserve and enhance this unique iconic building with a community-oriented use for now and future generations,” he added. This will be a benefit to the City of Merrill.
In Lebal’s July 6 letter to the City, she and the other members of the MHS Board concur: “We strongly believe that the removal of the reversionary clause … is the only way to find a new owner and preserve this building. The MHS Board is asking the Common Council to take action on this and allow us to move forward with the sale to Jon Malm.”
The Board debates
No decision was made on the issue at the June 23 Board of Public Works meeting. Aldermen and the Mayor discussed the pros and cons, but in the end, they were at odds as to whether or not MHS could sell the building without their approval, even with the reversionary clause carrying forward. Or if the building automatically reverted back to the City because MHS was obviously no longer needing it if they were looking for a buyer.
Some Aldermen wanted to “Keep our rights in place for now” and “put the property out for public bids to be fair.”
City Attorney Tom Hayden emphasized that at this point, the City doesn’t own the building. And “the City can’t sell what they don’t own.”
Mayor Woellner also mentioned the possibility of “selling the clause” … suggesting that the City could be compensated for eliminating the clause in a purchase.
In the end, the Board decided they needed a lawyer’s opinion before they could make any decisions and that they were not prepared to make any decisions without that, and Mayor Woellner made a motion to include the matter on the Agenda for the next Board of Public Works meeting on Wednesday, July 28, at 5:15 p.m.
More questions than answers
As of the writing of this article on Monday evening, there are certainly more questions than answers.
Since the June 23 meeting, the City has received a legal opinion on the matter rendered by local independent legal counsel. While more extensive language was included in that legal opinion, it ultimately boiled down to one critical line in the letter: “When the Historical Society moves out, it would revert back to the City.”
In light of this information, the members of the Board of Public Works will again consider the MHS request, as well as any other information they have, and will hopefully vote to make a recommendation, one way or the other, for the Common Council to consider at their Tuesday, August 10, meeting at 6:00 p.m.
Despite precedence to the contrary, MHS is now prepared to up the ante to make this deal happen, as well.
“We have offered the City $10,000 in compensation from the sale of the building to Jon Malm for the City to relinquish all further claims to the property,” Burg and Lebal said.
Will that be enough for the City of Merrill to “sell” them the reversionary clause?
Or will the City keep the entire purchase price, if they remove the reversionary clause to effect the sale? Malm has indicated his purchase is contingent on removal of the clause due to the investment required to make the Center for the Arts a reality.
Will the sale fall apart, and the property revert to the City and then be put out for bids?
These and more questions remain to be answered.