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150 South Fifth Street <br />Suite 700 <br />Minneapolis, MN 55402 <br />(612) 337-9300 telephone <br />(612) 337-9310 fax <br />www.kennedy-graven.com <br />Affirmative Action, Equal Opportunity Employer <br />WH235-37-999228.v1 <br />DAVID T. ANDERSON <br />Attorney at Law <br />Direct Dial (612) 337-9274 <br />Email: danderson@kennedy-graven.com <br />January 6, 2025 <br />VIA EMAIL ONLY <br />Kevin Beck <br />2350 Wycliff Street, Suite 200 <br />St. Paul, MN 55114 <br />Email: kbeck@kellyandlemmons.com <br />Re: White Bear Lake/Gem Lake Police and Fire Service Contract Dispute <br />Dear Mr. Beck: <br />This letter is in response to your offer of compromise, dated November 4, 2024 and sent under <br />Rule 408 of Minnesota Rules of Evidence. The City of White Bear Lake (the “City”) respectfully <br />declines Gem Lake’s offer, including, without limitation, the invitation to negotiate an interest <br />amount of anything less than the fair and proportionate amount called for under the contracts. Past <br />correspondence from my office clarifies how invoices were calculated and the City stands by those <br />calculations. The outstanding 2024 balance owed by Gem Lake for interest on the bonds issued <br />to pay for the new public safety facility remains at $7,885.00, which includes $3,129.00 owed <br />under the fire contract and $4,756.00 owed under the police contract <br />Additionally, it’s worth noting that the City is currently not charging Gem Lake or other <br />contracting jurisdictions the full amount permitted for services under the respective fire contracts. <br />When these contracts were updated in 2023, the definition of the term “Fire Services” was <br />expanded to include, among other things, emergency medical services. In other words, when <br />calculating the projected annual cost of Fire Services for the purpose of invoicing under section <br />2(a)(1), the City has the express right to include the annual cost of providing ambulance services. <br />In 2025, for example, the City projects that the total annual cost to provide ambulance services <br />throughout its service area will be $1,171,795.00. If that amount was included under the City’s <br />section 2(a)(1) calculation, as permitted under the terms of the revised contract, it would result in <br />all contracting jurisdictions paying their proportionate share of that number. While the City by no <br />means waives its right to charge for these costs in future years, I point out its current practice of <br />not doing so to further illustrate the fact that Gem Lake is receiving high quality emergency <br />services, including fire and ambulance, for an extremely fair price that is far below what the <br />contract calls for.