EAGLE RIVER — Keweenaw County Board Chairman Don Piche said at the regular July meeting Wednesday that thanks to the Michigan Department of Natural Resources (DNR), the land purchase agreement between the county and John Mueller, owner of the Keweenaw Resort LLC, has stalled.

“Sorry to say,” said Piche, “the county and John couldn’t get together with the DNR to come up with an agreement. We had two purchase agreements ready to go, and the DNR, in my opinion, screwed that up, so we’re kind of at a standstill with selling that property to John.”

Earlier this year, the County Board approved a purchase agreement, along with trail and conservation easements for the county-owned property, upon which are several bike trails. Keweenaw Resort was willing to purchase the property, which would negate the county’s concern about liability on the trails. The purchase agreement also included the conservation easement between Keweenaw Resort LLC and Keweenaw Community Forest Company, and a trails easement agreement between Keweenaw Resort LLC and the Copper Harbor Trails Society Inc; and application for conveyance of state land for public purposes to the DNR.

An appraisal was completed, and came back at $285,000.

Under the agreement, the Keweenaw Resort would purchase the property subject to the public purpose restriction and reverter, record the trails easement and, because of the public purpose restriction staying in effect, the conservation easement would no longer be required. The County would support rezoning the 63 acres that is not in the DNR reverter area, from Conservation Environmental Protection to Resort Services 2, or a Planned Unit Development. Mueller would be willing to pay $279,500 with the public purpose restriction and reverter remaining on the property. County attorney Miller applied to the DNR for removal of the public purpose restriction and the reverter on the 320 acres, of the total 380 acres, that Keweenaw Resort would purchase.

The DNR, it was stated during the May 12 special meeting, may take a stance that a transfer of ownership of this property would violate the public purpose restriction and the DNR could take ownership of the property by exercising the reverter.

The DNR raised several issues. After the May 5 meeting, the only thing for the Board and Keweenaw Resort to consider was the split of money for the parcels. The amendment to the purchase agreement will have the following things, some repeated from the May 5 meeting: Keweenaw Resort would purchase the property subject to the public purpose restriction and reverter, record the trails easement and because of the public purpose restriction staying in effect, the conservation easement is no longer required.

Under an amended agreement, Keweenaw Resort would pay $200,000 to the county for the 63 acres that are not subject to the deed restriction (aka-the potential rezoning area), and $79,500 would be allocated to the portion of the property that is subject to the DNR deed restriction and reverter. The $79,500 would be held in escrow by Keweenaw Title and after closing, the county and Keweenaw Resort would jointly file a request that the DNR confirm, in writing, that the 1946 deed restriction is a use restriction and not an ownership restriction, and that both parties would work to obtain confirmation of this within 180 days. If the DNR was to confirm that the deed restriction is a use restriction, and not an ownership restriction, within 180 days, the County would receive the funds from Keweenaw Title that were held in escrow; otherwise, Keweenaw Resort will receive the funds from escrow. The proposed closing will be occurred by the middle of June.

Without providing details at Wednesday’s regular meeting, Piche said only that the DNR was unwilling to work amicably with the county and Keweenaw Resort LLC.