Willmar Municipal Utilities seeks 27-acre site outside city limits; council delays approval to resolve annexation and utility extension questions

The Willmar City Council on Feb. 25 deferred for 30 days action on a purchase agreement submitted by Willmar Municipal Utilities for a 27‑acre parcel outside the city limits intended as a new consolidated utilities facility.

Jaren Smith, general manager of Willmar Municipal Utilities, described a multiyear site-selection process and said the utilities commission had authorized staff to draft purchase agreements. Smith said the purchase agreement includes contingencies that would void the sale if the parties cannot reach a reasonable solution on water and wastewater service or other due-diligence items.

Kevin Marti, facilities and maintenance supervisor for the utility, summarized the project's history and site criteria, saying staff evaluated approximately 20 properties within and adjacent to the city and found the selected parcel best met access, response-time and future-expansion goals. Marti said the utilities have set aside earnings to fund most of the project and that “there are no planned or expected impacts to rates for the project.”

Council members pressed staff on several points. Asked for estimates to extend water and wastewater service across the bypass, Marti said the city’s engineer modeled a scenario at roughly $2,600,000, but he could not confirm how many acres that estimate would serve. Staff said they had been speaking with city administration and the city attorney’s office about annexation options and that annexation by ordinance is likely possible because the parcel would be city-owned after purchase.

Council member Justin moved to defer approval of the commission’s action for 30 days to allow staff to gather additional information about potential utility extension costs, annexation procedures, and whether industrial‑park alternatives could save public funds. The motion passed on a roll call with six yes votes and one no.

Staff detailed the major contingencies in the purchase agreement: reaching agreement with the city and county on water/wastewater cost sharing or permitting for private service until the city can extend service, satisfactory soil borings and environmental studies, and planning commission approvals. Smith said the utilities had included a 90‑day due‑diligence period in the agreement to allow time for those matters.

Council members also asked about operations impacts and customer access. Marti said the planned site would improve response times from the utility and reduce inefficiencies caused by operations spread across multiple buildings. He said the utility considered the industrial park site but cited traffic, access, and competing interests as factors that lowered that site’s score against the adopted criteria.

The utilities presentation also mentioned the decommissioning of wind turbines on leased school property; staff said the utility plans to issue an RFP to remove turbines and expects recycling value and capital‑budget funds will offset part of the removal cost.

Because the motion to defer passed, city staff and the utilities commission will continue negotiations and return to the council with the requested cost and annexation information before the city takes further action on the purchase agreement.