Remember when a blighted tract of commercial property near Highway 75 and Interstate 94 in Moorhead was a gateway into the city on a busy thoroughfare? The Holiday Mall was an abandoned hotel, next to other dilapidated structures and weedy parking lots. It was home to rats, vagrants, vandals and an occasional drug dealer. It had become a trash dump. The city was desperate to halt the decay and redevelop the site into a sparkling retail district.
The city and the Economic Development Authority needed a developer with a track record. They found one in Rick Jordahl and Moorhead Holiday Associates. Jordahl had done several commercial and residential projects in Moorhead. He was among the city’s largest taxpayers. (Brookdale Mall and Fairmont Creamery were his work.) Developer, city and EDA agreed to a mutually beneficial master plan for the Holiday Mall, so named because the hotel had been a Holiday Inn.
Jordahl funded site work and construction with the expectation he would recoup his investment via tax increment mechanisms put in place by the city and EDA. It was a blueprint that had worked for other projects. Jordahl was assured the city and EDA would honor their obligations. Jordahl honored his and went to work.
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But, when the Minnesota Legislature changed property tax regulations, and costs increased at the job site and recession set in, the city would not pay its share. Jordahl had put up millions of dollars to complete the work with the understanding he would be repaid by the city and EDA from tax revenues as the development advanced. Today, the district is thriving with a hotel-convention center (Jordahl did the spadework to get the hotel), restaurants, a professional building and other businesses. It’s an attractive commercial zone of which the city is rightfully proud. It’s a welcome change from the former squalor.
Fast forward. It is hard to come to any other conclusion but that Moorhead stiffed Jordahl. As the new Holiday Mall blossomed, Jordahl petitioned the city to pay him the money he committed when the city and EDA asserted they were strapped. The city and EDA reneged, even declining to adjust valuations on the properties, thus realizing less revenue with which to pay the developer.
In effect, Jordahl had saved the project. For years, officials dismissed Jordahl’s pivotal role. They ignored his inquiries. Then, after an August 2018 letter to the EDA, Jordahl was offered a meeting with the city attorney, city manager and EDA chairman. After more delay, on November 7, 2018, Jordahl and his lawyer got the session they had been requesting for months. I attended as a silent observer. It went well — cordial and ostensibly productive. City and EDA representatives appeared to comprehend and even concur with Jordahl. The city attorney, whom Jordahl believes has been an obstacle to achieving resolution, seemed amenable. Jordahl left the meeting feeling better about a compromise.
Today, seven months later, Jordahl waits. At a May 5, 2019, EDA meeting, the city attorney pledged to send Jordahl a letter by the end of the week. Jordahl has not received a letter. Tactics of delay confirm a strategy by which the city and EDA kiss off obligations to a developer whose projects have made Moorhead a better city. It’s disgraceful, even if marginally legal. By any measure of principled dealing, the city and EDA have been unethical at best, unintentionally corrupt at worst.