By Miles Maguire
If city officials thought that hauling the owner of the Pioneer Resort into court would jump-start the development of what many consider to be the most valuable piece of property in Oshkosh, they would have to be disappointed with the response they received.
The owner, a Brookfield-based limited partnership called Decade’s Monthly and Income Appreciation Fund, replied to the city’s June 12 lawsuit with a point-by-point rebuttal of the claims that were advanced to have the Pioneer declared a public nuisance.
Rather than rolling over at the sign of the city exerting some legal muscle, the property owner, which does business as Decade Properties, fired back in August with an assertion that the city may have engaged in fraudulent behavior and is itself responsible for its predicament over what to do with the site. The company also called for a jury trial in the case, which involves a 15-acre parcel that is bounded on the north by the Fox River and on the east by Lake Winnebago.
“I don’t take it personally,” said City Manager Mark Rohloff. “They are referring to things that happened in previous negotiations.” He added that he recently had a “good conversation” with the president of Decade, Jeffrey Keierleber, who did not respond to the Scene’s request for comment.
Decade bought the Pioneer in 2002 for $4.2 million with plans to replace the hotel portion of the resort in an expansion that was valued at the time at $20 million. But a dispute with the Department of Natural Resources ensued over what could be built there, and the owner believes that the settlement imposed overly restrictive conditions on construction.
The business continues to operate as a marina. But most of the main building was torn down, and the city has complained that what’s left of the Pioneer has become an eyesore as well as a magnet for potential vandals.
While the Pioneer property is a top priority for city officials, Keierleber has made it clear that he has other concerns. Earlier this year, he acted to correct what he said was a longstanding oversight—paying taxes on what he sees as an inflated valuation of the site.
The Pioneer land and buildings have been valued at $2.2 million, and Decade has been paying about $50,000 a year in property taxes. But in April the company asked to have the improvements declared as worthless and the valuation of the land cut by $230,000.
“Had we focused on this in prior years, we would have asked for this reduction years ago,” Keierleber wrote in a letter to the city. “This has slipped through the cracks on our end for many years.”
On its website, the company says that it has raised $100 million for real estate investments since 1980 while building a portfolio of office buildings, hotels, marinas and a shopping center. Apparently the issue of possibly overpaying its Oshkosh taxes for a decade has not been a major issue.
In its letter to the city, Decade argued that its settlement with the state meant that it could not rebuild on the existing footprint and so that the remaining structures “have a negative value because they will have to be taken down at some point.” Nonetheless the assessment remains unchanged.
The Pioneer situation is “obviously a big problem,” said Steve Cummings, a member of the Common Council who has been outspoken about the importance of focusing community attention on the potential of the waterfront.
But he pointed to other signs of gathering momentum for redevelopment, including a series of public workshops over the summer that were designed to gather community input. The results from that “visioning” process are expected to be released later this year.
“The citizens of Oshkosh really own the river,” Cummings said. “People are starting to recognize that it’s the city’s major asset.”
The city received a consultant’s report in May that reviewed a range of options for Pioneer Island, everything from apartments to a water park to a TV set for a program such as “Wipeout,” a game show in which contestants compete on an oversize obstacle course.
Tim Short, one of the consultants who worked on the report, described the Pioneer as “a wasted piece of property.” Speaking at a July meeting on the report his firm produced, Short said he believes the best option is to turn the Pioneer property into some kind of “destination,” perhaps with a high-end restaurant and a mix of retail shops.
One complicating factor is the increasing volume of traffic on the nearby railroad tracks, which can temporarily block access to the site as well as generate noise that would be unwelcome for overnight guests.
At the time of his presentation Short was recommending that the city ratchet up the pressure on Decade to get it to cooperate. But given the company’s response to the city’s lawsuit, cooperation does not appear to be a reasonable near-term expectation.
In the meantime the city is getting ready to draw up a new master plan that takes in not only Pioneer Island but much of the adjacent real estate. The hope is that over time, as more new projects are built along the riverfront and in surrounding neighborhoods, Decade will decide to move ahead with development plans for the Pioneer or sell the property to someone else who will.
As Mayor Burk Tower has noted, the city is not going to move very fast on this. “We’re talking 20 years out. We’re not talking next year, maybe 10 years,” he said at the July consultant presentation.
Copyright 2014 Miles Maguire.
Miles Maguire is the author of Advanced Reporting: Essential Skills for 21st Century Journalism. He can be reached at firstname.lastname@example.org.