McCook EDC officially buys Keystone

A chute for demolition material leads from the windows of the Keystone to a trash container, and caution tape blocks off the Norris Avenue sidewalk because of falling debris. (Bruce Crosby/McCook Daily Gazette)

The McCook Economic Development Corp. purchased the Keystone Hotel Tuesday for $150,000.

According to Rex Nelson, MEDC executive director, the building was purchased from Keystone Hotel LLC.

Dale Stewart is listed as one of the owners and originally purchased the building in 2000 for an amount between $104,ooo and 105,000, according to the Red Willow County Clerk's office.

City sales tax revenue alloted to the MEDC was used for purchase, Nelson confirmed.

The building is being renovated into a Business Center, with the MEDC as the developer. Nelson said final construction papers were signed Tuesday with EAD Construction of Omaha as the construction manager. Several local subcontractors and suppliers also will be involved, he said.

Demolition on the interior of the building has been done for the past two weeks and the next step is to stabilize the building, Nelson said. Repairing rain downspouts inside the building is slated along with installing new windows.

Renovation work is expected to continue for 14 months, according to contracts signed with the general contractor.

The council, acting as the McCook Community Development Agency, authorized Monday night a resolution that allows a $320,000 tax increment revenue bond to be used in the renovation.

The 15-year bond will be issued by the Community Development Agency and be purchased by the McCook Economic Development Corp.

The bonds will be re-paid from the increased property tax revenue created by the improved structure, over the next 15 years, beginning in January 2010.

Currently the building is assessed at $120,000 with property taxes at $2,475. After construction is completed, the facility is estimated to be valued at $2 million, with property taxes at $40,000 annually. The normal taxing authorities such as the school, county, NRD, etc. will capture those increased taxes after 15 years.

The resolution the McCook Community Development Agency approved without discussion Monday night includes :

* the issue of the bond

* terms and provisions of bond

* pledging revenues of the Agency according to Community Development law

* authorizes the sale of the bond

* provides for a grant to release the funds

* provides for a redevelopment contract and for the resolution to take effect.