Council keeps depot lease at $1 for one year after debate over rent and tax assessment

At its July 25 meeting, the Galena City Council voted to keep the Depot Building lease at $1 for the upcoming year while the city and tenant revisit terms later.

The decision followed a split debate over a proposal to renew the lease with GGMI (referred to in the meeting as “Greater Delina/ GGMI Marketing Incorporated”) for an amount equal to whatever the building would be assessed for in taxes plus $5,000. Councilmember Katie Williams moved the tax-plus-$5,000 renewal; that motion did not carry. Council later approved a separate motion to continue the existing $1-per-year arrangement for one year and review the matter again.

Supporters of requiring a larger payment said the city should recapture more revenue because the tenant generates income and comparable properties pay higher assessed values. Opponents argued changing the longstanding $1 arrangement risks creating inconsistent treatment with other city tenants (for example, the history museum) and could open “a can of worms” if the building’s future use (including a potential return to train-depot operations) changes the tax consequences.

Council members noted that the building’s assessed tax value is not current or certain. Staff and council estimated a wide possible range for annual taxes if the property were placed on the tax rolls: roughly $8,500 at one comparable up to about $45,000 at another comparable. Council members said the township assessor has not re‑assessed the property and that an updated valuation would be needed to calculate a tax-plus-rent formula.

The lease under discussion includes a maintenance cap that previously was $2,000 per occurrence; the proposed renewal would raise that cap to $5,000 per occurrence. Councilmembers referenced that provision while weighing whether a higher rent or maintenance contribution was appropriate given previous tenant investments and repairs to the building.

After the first renewal motion failed, a new motion to “keep it the way it is” — clarified on the record as $1 per year for the coming year under the contract in the agenda — passed on a subsequent roll call. Council directed staff to continue tracking the building’s assessment status and to return with additional detail at a future meeting.

Council did not adopt any other changes to the lease language at this session; the council noted they could revisit term length, rent percentage for other agreements, and maintenance responsibilities in follow-up work.