After lengthy discussion along with input from multiple members of the public, the Albert Lea City Council voted 5-2 Monday to defer assessments for the second phase of the Tiger Hills housing development.

Under the new arrangement, the developers must pay back the city assessments already imposed for this phase either as the lots sell or else by Nov. 30, 2017, whichever happens first. Prior to the change, the developers had to pay assessments on a certain number of lots per year through 2017.

The agreement also states the developers will pay all delinquent taxes by Aug. 30.

The measure ultimately will keep the lots from going into tax forfeiture in the coming year.

“This is not a decision the council has looked at lightly,” Albert Lea Mayor Vern Rasmussen said. “We’ve all sat up here and waffled back and forth on this decision.”

Ultimately, however, he said he had to consider what would be best for the city of Albert Lea, and in this case that meant figuring out how to get the city’s money back.

“I think it’s been a pretty successful development,” Rasmussen said. “I find it hard to believe that we as a community could sell those lots any quicker.”

Rasmussen, along with councilors Larry Baker, Reid Olson, Larry Anderson and Al “Minnow” Brooks voted in favor of the amendment, while councilors Ellen Kehr and John Schulte voted against it.

Kehr noted she did not want the assessments deferred until 2017 and wished to move this date closer, like what was supported by City Manager Chad Adams.

Schulte said he was concerned about what risk approving the deferral would have on setting a precedent or policy.

“We need to be fair,” he said.

The vote came after a lengthy presentation by Tiger Hills developer Greg Moen about the project. Moen said he wanted to clear up many rumors about his development.

He wanted to emphasize to the public that he was not asking for any money or a reduction in his interest rate.

“I’m asking for time,” he said.

Moen said his project has brought $4.4 million in tax base to the community, and it equates to about $65,000 in annual property taxes with the current houses in place. He noted that every time a house in his development is built, there are 32 companies that make money, including the city of Albert Lea.

He encouraged the council to vote on the issue that night, instead of waiting until the spring.

“I have a banker that’s willing to work with us; I need a city that’s willing to work with us,” Moen said.

He said his bank, Farmers State Bank of Hartland, has agreed to release some of the proceeds from lot sales to pay his delinquent taxes.

About $32,000 is owed in delinquent taxes through the first half of 2011, according to Freeborn County Auditor-Treasurer Dennis Distad. To keep the lots from going into tax forfeiture, all delinquent taxes, and assessments must be brought up to date.

With the council approving a deferment of assessments, this means Moen can pay his taxes. The assessments will not be considered delinquent.

The council approved a similar arrangement for the first phase of the project, and Moen said it has helped him get caught up on taxes there.

Olson said he thinks the council made the right choice when it amended the first phase of the project, noting that it is moving forward in a timely manner and the city is getting its money back and making interest.

He argued that if the project was for an industrial development, the council would do everything it could to help them succeed.

A couple developers from outside the community, along with people living in the Tiger Hills development, issued support for Moen during the meeting and for the work that is being done in the development, despite a recession.

Former 3rd Ward Councilor George Marin, the pastor at Grace Christian Church, also voiced support for the developers. Marin was on the initial council that voted for the Tiger Hills deal, along with Rasmussen and Brooks.

“We were not mistaken then, and you would not be mistaken tonight to support this development,” Marin said.

He noted there were no “back-room deals” made at that time for the development, and there were no favors done for then-City Finance Director Rhonda Moen, Greg Moen’s wife.

“I’m here to stand in defense of the council that served then,” Marin said.

He added that he thinks the city should try to aim for a reputation of being helpful to developers.

Nancy Skophammer, representing Farmers State Bank of Hartland, which provided initial funding to Moen for the development, said she still believes the project’s land is beautiful and that it has a “great deal” of residential potential.

“For her to tell me they’re enthusiastic about the project, it seems to me the City Council ought to take a look at that,” Baker said.

Moen said after an upcoming lot sale, there will only be nine lots left in the second phase left to sell.

Brooks said he struggled with the decision because of other developers who might come to the city now and request a similar arrangement.

“But it came to the point, our best opportunity to collect those assessments would be to work with Greg,” Brooks said.

Look to the Tribune Wednesday for more information about other items on the council’s agenda.