Vermilion Park still negotiating

Despite public assurances from DNR officials that no side deals with U.S. Steel were being worked on, documents show what state negotiators have offered, or at least considered, during the negotiations:

Like an eager car buyer willing to pay extra for floor mats and undercoating, the state of Minnesota has sweetened several offers as it tries to persuade U.S. Steel to sell it 3,000 acres on Lake Vermilion for a new state park in northern Minnesota.

While the state is limited by the Legislature on how much cash it can offer -- up to $20 million -- Department of Natural Resource (DNR) negotiators have floated a range of offers tied to other U.S. Steel business dealings, according to internal department documents.

Despite public assurances from department officials that no side deals with U.S. Steel were being worked on, the documents show what DNR negotiators have offered, or at least considered, during the negotiations:

• Agreeing to recommend approval of 25-year taconite leases to U.S. Steel on 240 acres of land, a deal worth an estimated $10 million.

• Providing the steel giant $5.4 million in free biomass fuels such as wood chips, and offering to have DNR workers assigned to help manage U.S. Steel's interests in converting from coal.

• Turning over 3,000 acres of wetlands to U.S. Steel anywhere in the state and ensuring that DNR and Pollution Control Agency staff put a priority on U.S. Steel's needs.

But U.S. Steel has so far rejected the state's offer for the Vermilion land, and the St. Louis County Board recently approved a plan allowing the company to develop the property.

Asked about the DNR's dealings with U.S. Steel, Commissioner Mark Holsten said last week that the department made its last and best cash offer and that other options were considered within the scope of state rules and regulations. The DNR staff dealt with the company's permit requests and other issues as separate and unrelated projects, he said. "The company has not been given preferential treatment in our review of their permit request," he said.

Despite the recent action in St. Louis County, the deal is far from dead

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