Click Here For Complete Weather
 

International Paper sells Keweenaw tip acreage to local realtor
Conservancy, DNR say sealed bids block conservation purchase

COPPER HARBOR ’Äì International Paper/Lake Superior Land Company

Glen Tolksdorf took this photo of Lake Superior and Keweenaw Point from his newly purchased property at the tip of the Keweenaw Peninsula. Tolksdorf said he would like to sell the property to the Michigan Department of Natural Resources for public recreation or to an out-of-state client. The property includes 4,500 feet of Lake Superior shoreline.

reportedly finalized the sale of 85 acres of wooded land at the tip of the Keweenaw Peninsula  Thursday to Tolksdorf Realty of Calumet. The sale may be soon be followed by a closed bid sale of the area west of Copper Harbor known as Hunters Point, which has been independently appraised at $1.7 million. Earlier this week a representative of The Nature Conservancy said a sealed bid process would exclude the conservancy from competing for the property, since the group is limited to purchases at appraised, or fair market, value.

Glen Tolksdorf would not disclose what he paid for the Keweenaw tip property, which, he said, he hoped to sell to the Michigan Department of Natural Resources or to one or more out-of-state clients. He noted he had been trying to purchase the

Glen Tolksdorf, Calumet realtor.

property for more than a decade.

’ÄúI’Äôve approached Lake Superior Land Company for 10 plus years, but this is the first time I’Äôve been able to acquire property,’Äù Tolksdorf said. ’ÄúI’Äôm waiting to hear back from the DNR ’Ķ I want to give them the first opportunity (to buy the property).’Äù

Tolksdorf said he would rather sell the property ’Äì which includes 22.6 acres at Keweenaw Point (Section 27), 23.2 acres on Highrock Bay (Section 22) and 40 acres inland (Section 22) ’Äì to the DNR than to a conservancy which is exempt from taxes.

’ÄúI would love to see changes in the tax laws for non-profit organizations,’Äù he said. ’ÄúThey should pay the full property tax so it doesn’Äôt (burden) the other taxpayers in the county ’Ķ I think if they want to preserve the property the state should have it so that the county gets some revenue in lieu of taxes.’Äù

Keweenaw County Equalization Director Jane Pelto said the three parcels (if the two in Section 22 that are now in Commercial Forest Reserve are removed from CFR) would bring in yearly total property taxes as follows:

• annual taxes of $784.70 for the 23.2 acres on Highrock Bay;
• an estimated $138.36 for the 40 acres inland;
• $1,951.69 for the 22.6 acres at Keweenaw Point.

 Pelto said Grant Township taxpayers pay a yearly millage rate of only 28.0783 mills because of the unique situation of the small Copper Harbor School. If these parcels were located in Allouez Township, for example, the millage rate would be about 47 mills per year and the taxes much higher.

 ’ÄúIn any other township,’Äù she said, ’Äúthe (acreage at Keweenaw Point) would cost over $3,000 in taxes.’Äù

 Pelto noted the state would pay full property taxes if they should purchase the land from Tolksdorf. Any land left in CFR would bring in only $2.30 an acre per year ’Äì $1.20 from taxpayers through the state and $1.10 from the landowner.

 The Nature Conservancy does sometimes make payment in lieu of taxes, as it did recently in a donation to Grant Township of $5,600, equal to two years' worth of property tax payments on its Horseshoe Harbor Nature Preserve near Copper Harbor. 

Both The Nature Conservancy and the DNR are limited to purchases at the appraised, or fair market, value ’Äì the former because of its non-profit status and the latter because it uses public funds.

Conservancy, DNR say closed bids exclude land purchases

 Tina Hall, Keweenaw representative for The Nature Conservancy’Äôs Michigan Chapter,   told members of the Lake Superior Maritime Heritage Society recently that IP’Äôs apparent intention to sell Hunters Point (about 260 acres, including extensive Lake Superior shoreline) through a sealed bid process ’Äì something like a silent auction ’Äì would exclude the conservation group from purchasing that property. The society, a group of Copper Harbor residents interested in building a maritime museum at Hunters Point, had hoped the conservancy would buy the property and turn over a few acres of it to them for the museum.

During a recent meeting with the Lake Superior Maritime Heritage Societyin CopperHarbor, Tina Hall, The Michigan Chapter of the Nature Conservancy’Äôs Keweenaw representative (center at table),  points out property that International Paper/Lake Superior Land Co. plans to sell from their Keweenaw holdings. Society members pictured at the table are (from far left) Don Kauppi, Clyde Wescoat, Rich Jamsen, Dan Plescher (far right, background), Tom Beveridge and Tom Poynter. Not visible, but present, is Ray Gerhart. Copper Harbor business owner Janet Shea (seated on bench), said the news of IP land sales ’Äúmakes the Comprehensive Land Use Plan development even more timely and crucial.’Äù Three Michigan experts will speak at a forum on land use planning at 2 p.m. Saturday, Sept. 23, at the Mohawk School.

Hall said a recent conversation with Walt Arnold, director of marketing and sales for Lake Superior Land Company, Calumet, revealed the conservancy ’Äôs efforts to negotiate any land purchase with the State of Michigan and Internation al Paper (IP) will now be thwarted if IP decides to start selling parcels of their Keweenaw holdings by a sealed bid process, in which the minimum bid would have to be above the appraised (fair market) value.

Mark Pontti, public affairs manager for International Paper, parent company of Lake Superior Land Co., said the closed bid process was a method of sale and the company’Äôs prerogative.

’ÄúIf it’Äôs appraised at a certain value, then we’Äôre going to expect at least that value regardless of the process used for sale,’Äù Pontti said.

’ÄúWe’Äôre already out of the game,’Äù Hall said. ’ÄúThey’Äôre going to start systematically selling all the property starting with the tip, going forth in as small parcels as possible ’Äì one at a time.’Äù

Arnold did not confirm that the company intended to sell only small parcels, nor that any areas but Hunters Point were being considered for closed bid sales. He noted a number of people, including the maritime society, had expressed interest in Hunters Point.

’ÄúWe discussed that we weren’Äôt subdividing it. They (the maritime group) were interested in just a portion of the property,’Äù Arnold said.

Hall told members of the society she understood Hunters Point would be the first piece of land to be sold as an ’Äúexperiment’Äù through a sealed bid process and, if the process were successful, the company would subdivide the Schlatter Lake area into 40-acre parcels and sell it by sealed bid as well.

Arnold said that a sealed bid process for Schlatter Lake was possible, but ’Äúpure speculation at this time’Äù and that the area was not platted. He noted the company had only subdivided or platted land in a few places, including Bete Grise North, Calumet Waterworks, Seven-Mile Point, Eagle Harbor South and Lake Medora.

Ray Gerhart, president of Northern Consultants and a maritime society member, said previous efforts to submit grant proposals to the Michigan DNR Trust Fund for land acquisition at Hunters Point were unsuccessful.

Northern Consultants President Ray Gerhart (left) and Grant Township Supervisor Tom Beveridge discuss the possible closed bid sale of Hunters Point at a recent meeting of theLake Superior Maritime Heritage Societyin CopperHarbor.  The society had hoped The Nature Conservancy would purchase Hunters Point and turn over to them a few acres of the property for a maritime museum.

’ÄúIs there any way we can be pro-active with Hunters Point, or do we sit back and wait for the next owner?’Äù Gerhart asked.

Grant Township Supervisor Tom Beveridge said another grant proposal to the Trust Fund would take at least one and a half years.

Said Gerhart, ’ÄúIt would be nice to see if there could be some sort of coalition among interested parties (such as local groups, the DNR, The Nature Conservancy) that could approach IP on whichever properties they think should be dedicated to public ownership. There are certain pieces of property that should be kept for the public interest.’Äù

Hall noted The Nature Conservancy had recently discussed which one Keweenaw area they would be interested in buying because it needs protecting. The choice would be Bete Grise South because of its Great Lakes marsh, a delicate ecosystem, she said, adding that the conservancy would also like to preserve the mouth of the Montreal River.

’ÄúI’Äôd hate to see that going into private property,’Äù she said. ’ÄúEverybody’Äôs thought about it as public land for so long that it’Äôs a rude awakening.’Äù

This photo of the Lake Superior shoreline was taken during a hike along the scenic trail to the mouth of the Montreal River ’Äì a spot that The Nature Conservancy, the state and local residents would like to see preserved for the public interest.

Gerhart agreed the mouth of the Montreal River is one area that the majority of local residents would like to see preserved for public access.

’ÄúThere is work to be done, but it has to be done immediately,’Äù he said.

Pontti noted LSLC ownership includes 222,645 acres in Michigan  (primarily Keweenaw, Houghton and Ontonagon counties) and 67,527 acres in Wisconsin (primarily Florence County), for a total of 290,172 acres. He said only 2 percent of that total ’Äì about 5,000-6,000 acres ’Äì is projected for sale or development.

’ÄúThe strategy has always been to manage our ownership as a source of wood supply for the Quinnesec mill, but as part of that (ownership) portfolio there always is a percentage that’Äôs been designated for best value as being sold or developed,’Äù Pontti said. ’ÄúIt’Äôs not providing the fiber value that we would derive for the wood supply.’Äù

He added the company’Äôs strategy was impacted by the failure last fall of the land trade proposal with the state. Had the proposed land swap been successful, he said, the Michigan DNR would have acquired 20,500 Keweenaw acres in exchange for 36,200 acres of state land in the southern half of Houghton County. The 20,500 acres include much productive timberland, 8 miles of Lake Superior shoreline and 30 inland lakes and streams, he noted.

’ÄúSo, the 20,500 acres are extremely productive forestlands, as well as offering some of the highest recreational value in the State of Michigan,’Äù Pontti said. ’ÄúIt would have been good for the people of the state to own such a treasure.’Äù 

However, according to Jim Eckdahl, Michigan DNR Upper Peninsula field deputy, neither the public nor the state was interested in the loss of state land that was part of that proposed swap. Three years before that proposal, the DNR had identified Keweenaw lands they were interested in, including the mouth of the Montreal River and an area along the river; areas at the tip of the Keweenaw including inland lakes; and the south shore area west of Keweenaw Point. When the land swap failed, he added, the DNR was still interested in purchasing some Keweenaw lands.

’ÄúWe indicated to Champion/LSLC (now IP/LSLC) at that time that we were still interested in purchasing some of the land.’Äù

Said Pontti, ’ÄúTo my knowledge we’Äôve never received any proposal (from the DNR) at fair market value ’Ķ That’Äôs why we were disappointed when that land trade fell apart. We never got to the point with the DNR of appraising each other’Äôs acreages.’Äù

Pontti noted that at the time of the land swap negotiations ’Äúoutright purchase was not the first option. The DNR encouraged us to propose a trade ’Ķ The door has always been open for further discussion with the state.’Äù

DNR Resources Management Deputy George Burgoyne said the state has recently had some informal contacts with IP on the possibility of Keweenaw land purchases.

’ÄúAfter the land trade fell through,’Äù Burgoyne said, ’Äúwe told them we were still interested in some other possibilities for state acquisition of some or all of the lands that they had proposed ’Ķ And right now we’Äôre working with some conservation organizations (including The Nature Conservancy) to see what we can put together, in the form of a formal contact or proposal, that may be of interest to International Paper.’Äù

Both Eckdahl and Burgoyne said the closed bid process is difficult for the DNR since, like The Nature Conservancy, they are limited to purchases at appraised, or fair market,  value.

Said Eckdahl, ’ÄúIf they’Äôre interested in dividing it into small parcels and selling by sealed bid, that’Äôs not a process that lends itself to public acquisitions ’Ķ We’Äôre allowed to pay fair market value and we can’Äôt compete in a bidding process.’Äù

He added the law requires the state to pay fair market value.

’ÄúThese are taxpayers’Äô dollars, and so the law is pretty conservative in how we’Äôre able to use them,’Äù Eckdahl said. ’ÄúThe public has to know that it’Äôs always been in our minds to acquire this property, and it remains to be seen if the company is interested in working with us to make that happen or not.’Äù

Eckdahl said state management of the potential property, such as providing trails and other public accommodations in the area, would be another consideration.

’ÄúThose are all management interests we’Äôd have to resolve,’Äù he said. ’ÄúI think we’Äôd do reasonable things to provide public access to it.’Äù

Hall said she was surprised that IP appeared to be disregarding the desires of local people, the DNR and The Nature Conservancy in their plans to sell Keweenaw properties.

’ÄúThe unfortunate thing is it doesn’Äôt sound like there’Äôs any pity or any justification being given for local government or conservation or anything,’Äù she said. It’Äôs really whoever has the most money will get this property.’Äù

Pontti pointed out that in the past, Lake Superior Land Co. under its former parent company, Champion International (now owned by IP), cooperated with local wishes in donating certain key areas for protection. Their donations (past and present) and fair or below market sales include:

1.  February 2000: In Calumet Township, 760 acres of property lying within the Swedetown ski trails system. LSLC donated 25 percent of the property’Äôs value to the Swedetown ski trail system ($70,000). 
2. Sale of 1.25 miles of Lake Superior shoreline (commonly referred to as Horseshoe Harbor) and 227 acres of adjacent geographically unique and biologically significant land to The Nature Conservancy at below market values.
3. 2000 feet of prime sand beach plus 35 acres at Bete Grise North donated to Grant Township for public use. LSLC also donated the funds to build a public bathroom/changing room for the new site.
4. Below market sale to the DNR, for inclusion into the Fort Wilkins State Park, 500 acres of land which included the entire south shore of Lake Fanny Hoe and all of Lake Manganese.
5. Lots within the Calumet/Laurium area for Habitat for Humanity construction projects.
6. All of Calumet and Hecla’Äôs and its successor, UOP’Äôs, historic mining records, employment records, maps and core samples to the Michigan Technological University Archives for the public’Äôs benefit.
7. Working on sale of the ’ÄúMouth of the Gratiot’Äù property to Keweenaw County.  LSLC would donate the 25 percent match to the county.
8. Working cooperatively with Eagle Harbor on its acquiring 137 acres surrounding the community’Äôs wellheads. Plan on donating 25 percent of the required matching funds for the site.
9. Annual expenses of over $1 million in road maintenance on LSLC forest roads, providing public access on most of these roads for use of the company’Äôs CFA properties.

 ’Äì Michele Anderson
September 22, 2000

Editor’Äôs Note: In your recent Keweenaw land sale article, I was in error in the last section of the ’Äúdonations’Äù area. For those projects in the hopper (# 8, Eagle Harbor-South and #7, Mouth of Gratiot).  Thus, we should no longer say we are providing for 25 percent  matches or donations on any land transactions. As we are not. Also, we are working with Eagle Harbor on its acquiring 157 acres, not 137 acres.
Thanks!
Mark Pontti