Year-long Fufeng debate comes to an end after Grand Forks council members vote to stop project
Decision comes after a number of residents called for the mayor and others to resign.
GRAND FORKS – A little more than a year after city leaders announced a Chinese-owned wet corn mill was planning to come to Grand Forks, City Council members on Monday, Feb. 6, voted 5-0 to stop the project.
Council members made their decision based on the fact that certain conditions specified under Section 8 of the development agreement can’t be satisfied.
Council members Kyle Kvamme and Tricia Lunski were absent.
The vote comes about a week after the Department of the U.S. Air Force provided an official position on China-based Fufeng Group , the company that planned to build the factory on some 370 acres along the city’s northern edge. In the letter sent to U.S. Sen. John Hoeven, R-N.D., Andrew P. Hunter — whose title is assistant secretary of the Air Force for acquisition, technology and logistics — said the proposed project “presents a significant threat to national security with both near- and long-term risks of significant impacts to our operations in the area.”
That was enough to prompt council members to abandon the controversial project. Their vote was met with a round of applause and cheers from those in attendance, many of whom expressed frustration at council members, city staff members and Mayor Brandon Bochenski. A number of them called for resignations from the mayor, City Administrator Todd Feland, City Attorney Dan Gaustad and council members .
Council member Ken Vein said moving forward, the council should think carefully about development projects.
“There’s something that I’ve learned through this process and that is sometimes to slow down and make sure we fully understand before we move to the next level,” Vein said. “As much as I agree with the intent of the motion, I’m going to assume it’s founded in factual law. ... I would assume you’ve looked thoroughly at the agreement and the understanding of the agreement and this is an avenue for us to terminate the development agreement”
Gaustad said the development agreement was reviewed and Section 8 of that agreement “had a number of conditions that needed to be satisfied.” Gaustad said section 8.1.10 has certain circumstances where the project becomes “impracticable or inadvisable to construct the city infrastructure for a variety of reasons.”
One of those reasons is “the institution or threat by any Governmental Authority of litigation, proceedings or other legal or equitable action against the Developer or the City.”
Vein also said council members should be aware of the impacts of terminating the project, such as the financial consequences. Having further discussion on those impacts — as well as looking at an improved citizen participation process — were some of Vein’s suggestions.
“This is the biggest issue I’ve ever worked on, I can tell you,” Vein said. “The most controversial, and as many of you know I did a lot during the Flood of ’97, and this has brought out some real issues that I think we’ve got to work through.”
Feland said a briefing with several task orders related to the project is set to be provided during next week’s Committee of the Whole meeting.
Many of those who spoke during the public comment portion of the meeting called for the city to reverse the annexation of the land. One of those residents was Frank Matejcek, who serves on the city’s Planning and Zoning Commission.
”Since it was undertaken as a means to pay for the extensive infrastructure needed for Fufeng, those who objected to the annexation should be returned to Falconer Townership’s jurisdiction, where they will be welcomed back,” Matejcek said. “And don’t forget, the Planning and Zoning Commission sent you a recommendation to the City Council that the annexation should not occur if Fufeng did not materialize. By returning the area to the township, you can start the long process to restore your credibility as community leaders.”
Other residents also called for the city to reverse the annexation, including Chris Spicer, who said his business is facing a 450% increase in taxes because of the annexation.
“Last fall, the city bought back 17 acres from Fufeng and constructed a huge stormwater pond right behind our shop. This occurred at the same time (the federal Committee on Foreign Investment in the United States) was conducting a review and city leadership claimed construction was put on hold during that time. What is the plan?” Spicer said. “Are the businesses along Highway 81 expected to bear the burden of the stormwater pond that was built to service Fufeng? My business, along with most others, do not need it.”
City Council President Dana Sande said since that land is annexed into the city, the city is legally obligated to provide the needed infrastructure.
“I wouldn’t fault people for wanting to go through the de-annexation process and as I told Mr. Matejcek last week, I’m happy to listen to any arguments and if there are reasonable arguments and we can figure something out, fine,” Sande said. “But for today we’re legally obligated to put in the infrastructure that we’ve committed to doing for the property owners that have been annexed.”
It is still not known what Fufeng plans to do with the 370 acres of land, which it legally owns. In a phone call prior to the council meeting Monday, Feland said there was still no indication from Fufeng as to what the company plans to do.
The city is still moving forward with water infrastructure projects for the annexation area including a watermain, sanitary sewer, lift station and forcemain. Council members approved the plans and specifications for the projects later in their meeting.
Also Monday, council members approved adopting resolutions authorizing the issuance of and appropriating the special assessments for the $3,167,000 of Refunding Improvement Bonds, Series 2023B (SRF) and use of $287,000 of Stormwater Utility cash to finance the construction of the storm pond near Highway 81.
Several state officials — including Gov. Doug Burgum and U.S. Sens. Kevin Cramer and John Hoeven — said they will support Grand Forks to find another agri-business moving forward.
In other news Monday, council members:
- Approved an employment agreement to hire Tess Moeller, who has most recently worked for Avera Health, as the next Grand Forks Public Health Director. Former Public Health Director Debbie Swanson retired at the end of last month.
- Approved a preliminary application by Memorial Village Investments, LLC for the Memorial Village II redevelopment project on UND, and to move forward with the final tax incentive analysis. The project entails two five-story buildings, underground parking, a collegiate softball diamond, and walkway connector to replace the existing parking lot directly north of Memorial Village. The total cost of the project is estimated to be $54 million. The next step in the process is to invite the applicant to submit a full tax incentive application, which includes a $2,500 fee. The complete application will be provided to the city's financial adviser, Baker Tilly, for third-party financial review and analysis. The review will then be presented to the Local Government Advisory Committee, which consists of representatives of the four local taxing entities.
- Approved the council chambers project, which is phase three of the City Hall renovations, in the amount of $1,828,407. When finished, the renovated council chambers will have a more modern and open space with improved visual, audio, presentation, broadcasting and safety features. Phase one of renovations made to City Hall was completed in the spring of 2021 and phase two was completed last summer.