Bozeman city manager Chris Kukulski announced a possible settlement with the city's insurance company over a $3 million damage award.
"It's clear that this is the best deal we're going to get in working through our negotiations and I think it's absolutely worthy of their consideration for approval Monday night," says Kukulski.
Under the agreement the city will repay $2 million of the $3 million in three payments with the last one due in 2014. Each payment must include 1.0% interest on the remaining principal.
The agreement does not prevent the city from selling or transferring the property to an economic development firm for less than the original purchase price. But if it does sell for a profit, the city would reimburse its insurer up to a million dollars.
Nearly 10 years ago Bozeman developer Mike Delaney sued the city for buying 85 acres of the Mandeville property officials knew he planned to purchase.
A judge awarded Delaney $3 million.
The city's insurer paid the settlement. But a judge ordered the city pay back the money.
The money will come from the city's general fund and will not threaten their reserve.
Several projects were put on hold to ensure the city would be able to pay the full $3 million.
Since they'll have to pay less than they originally planned for, commissioners will have to go back and amend the budget to see if and when they can move forward with any of those projects, such as the Bozeman Police Department designs or the Bogert Pool maintenance and design.
On Monday city commissioners will meet to consider authorizing the city manager to make the agreement final.