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Is Lake Elmo home to the most dysfunctional municipal government in America?

Over the last several years, the east metro community has become a place where the infighting is as predictable as it is debilitating. 

The Lake Elmo City Council assembled for a meeting on Feb. 16, 2016.
MinnPost photo by Craig Lassig

Earlier this month, at a meeting of the Lake Elmo City Council, the city’s mayor and four City Council members gathered inside the small council chambers at City Hall, a nondescript building close to the center of town, an easy toss from the Twin Point Tavern and Hagberg’s Country Market.

Along with the elected officials, several city staff members and more than a few citizens crowded into the chamber, whereupon they witnessed a victory of sorts, a small triumph: The council managed to get through the Pledge of Allegiance without an unkind word.

But the peace didn’t last long. Shortly after the pledge, the agenda called for a plaque to be presented to a city employee for excellence in financial reporting. In most places, this would have been a routine matter. Ho-hum. Pro forma.

But Lake Elmo isn’t most places.

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The plaque was presented to Cathy Bendel, the city’s finance director. There was a nice round of applause from the overflow crowd, which had come out to see what the council would do on a couple of hot-button issues, including the hiring of a city administrator.

One council member, Julie Fliflet, said she was pleased to see Bendel “finally” get the credit she deserved. In a previous year, it seems, credit for winning the award had gone to a former council member, Wally Nelson.

“Glad we could right a wrong and present it to you this year,” Fliflet said to Bendel.  

That was too much for another council member, Justin Bloyer. Red-faced, he said Fliflet’s remark’s were “unfortunate.”  

Fliflet smiled and shook her head. This agitated Bloyer all the more, and he mumbled something inaudible. 

Now it was spectators’ turn to shake their heads and roll their eyes.

“My god,” said a man in the crowd. “They even fight over good news.”

***

Over the last several years, Lake Elmo has become the little community where dysfunction has found a home, a place where the local government’s internecine squabbles have become as predictable as they are debilitating. Indeed, in the midst of this suburban utopia — rolling hills, meadows, lakes, expansive and expensive homes — lies what may be the most messed-up municipal government in all of America.

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Lest you find that hyperbolic, let’s look at some recent highlights: The Lake Elmo city administrator — who was given a raise by the council of 2014 — was encouraged/forced to resign by the council of 2015, a departure that was quickly followed by the city’s professional staff quitting, one by one. Two council members have been ordered not to speak to city staff unless witnesses are present. A journalist claimed she was physically threatened by a council member. Beleaguered city employees started a union organizing effort. A study, paid for by the City Council, declared that the council is, in fact, “dysfunctional.” When the study’s findings came out, the council demanded that the Washington County sheriff investigate who “leaked” the study — a public document — to the Stillwater Gazette.

Council Member Julie Fliflet
MinnPost photo by Craig Lassig
Council Member Julie Fliflet

These days, watching a Lake Elmo City Council meeting is like sitting through a very long evening with a bickering couple. A have-gavel-will-travel parliamentarian, who is paid about $200 an hour, tries mightily to keep the peace among council members, to little avail.

Perhaps the Lake Elmo City Council is just a microcosm of U.S. politics? Politicians no longer can simply disagree. They must threaten, bully and call each other liars, from Donald Trump on down to the town council. 

Still, why this uncivil behavior in such a charming place? An east metro suburb located between Stillwater and Woodbury, Lake Elmo is home to 8,000 people — most of whom are financially better off than even their well-off neighbors in Woodbury and White Bear Lake — spread over 24 square miles. There is lots of elbowroom.

And therein lies the problem, and the root cause for all this fighting: the pace of growth in a place that still thinks of itself as a rural outpost.

***

This growth issue goes back almost three decades. In the 1980s, Lake Elmo fought — and won — a battle against the intrusion of chain stores, such as Wal-Mart. But in 2005, the city fought — and lost — a battle against the Met Council over which entity controls growth.

“In a way, I feel sorry for Lake Elmo,” said former Met Council Chairman Curt Johnson. “They don’t want to change, but they lie in the path of where the march of growth is coming.”

Most of the people who live in Lake Elmo want growth to be controlled. That’s why they moved there, after all: to enjoy one of the last places in the Twin Cities that retains a conspicuously bucolic vibe. But some want slower growth than others.

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None more so than City Council Member Anne Smith, perhaps the most polarizing figure in polarized Lake Elmo. Smith, a 15-year veteran of the council, has a foot in two eras of city politics. There’s the pre-2015 era, when Smith was the only female on the five-person council (which includes the mayor), and often found herself on the losing end of 4 to 1 votes.

Even when she was the lone voice, Smith made herself heard. At one point, her colleagues on the council prohibited her from speaking to any city employee without witnesses present. That came after allegations of Smith harassing city staff, including former City Administrator Dean Zuleger.

Council Member Justin Bloyer
MinnPost photo by Craig Lassig
Council Member Justin Bloyer

City officials weren’t Smith’s only targets, though. A reporter for the Stillwater Gazette, Alicia Ann Lebens, alleged that she felt “threatened” by Smith in the City Hall parking lot following a council meeting in the fall of 2014. No one witnessed the event, but when Lebens went back into the council chambers, people said she was tearful and shaken.

Smith denies the notion she harassed either the reporter or city employees, though she does say, “I’m passionate about things being fair.”

In November of 2014, everything changed for Smith — and the council. Two incumbent council members, Mike Reeves and Wally Nelson, were easily defeated by newcomers Fliflet and Jill Lundgren. 

Smith worked hard for both women, who made growth the central issue of their campaigns. The candidates charged that the good old boys on the council — Reeves, Nelson, Bloyer, and mayor Mike Pearson — were willing to turn bucolic Lake Elmo into another Woodbury. Fliflet and Lundgren took their seats on the council in January of 2015. The new majority was in charge. 

*** 

The first priority for the new block was dispatching with the city administrator, Zuleger — despite the fact that the previous council had given him a $15,000 annual raise and rave job reviews. In February of 2015, Zuleger filed a harassment complaint against Smith, alleging that her actions — which included yelling, poking, even striking him, he said — created “a hostile working environment.” A month later, the new-majority council voted to fire Zuleger.

The backlash against the council vote was immediate and intense. Signs popped up on the community’s main street: “We protest council vote. Council is tyranny of the majority.” City hall meetings filled up with passionate defenders of Zuleger.

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By working with the Met Council, Zuleger’s defenders said, the Met Council had backed off its plans for Lake Elmo’s growth (from 24,000 by 2030 to 18,000 by that year). Additionally, Zuleger’s defenders said, he was bringing grant money into the community. His staff was also attracting businesses that would increase the community’s tax base even while allowing Lake Elmo to maintain its “rural charm.”

Council Member Anne Smith
MinnPost photo by Craig Lassig
Council Member Anne Smith

One of Zuleger’s supporters was John Schiltz, who owns and runs Lake Elmo’s best-known business, the Lake Elmo Inn, a beloved restaurant in what passes for Lake Elmo’s downtown. For decades, his place has attracted customers from throughout the metro area. 

Schiltz was on hand the night that many in the community blasted the new council for its plan to part ways with Zuleger. “Forty people spoke out that night,” Schiltz recalled. “Not one person complained. … The council members acted as if they were listening but they weren’t. For a few years, I thought we were headed in the right direction, but now we’ve hit a wall. Nothing is being done. It’s useless to attend meetings because they won’t listen anyway.”

The backlash was so vocal that the council did back off, briefly, from its initial decision to fire Zuleger. But a few months later, he resigned and accepted a buyout. In ensuing weeks, the city planner, the deputy clerk, the assistant city administrator, the taxpayer relations manager and the city receptionist all left.

***

Not everybody in Lake Elmo agrees with the “tyranny of the majority” signs that were aimed at the new council members in the dispute over Zuleger, of course. People such as former council member Steve DeLapp say that Zuleger and the male-dominated council were giving away too much, undermining all that makes Lake Elmo unique.  

DeLapp is a living symbol of the fact that Lake Elmo’s city government has long been a bit of a hothouse environment. At a 2008 meeting, he called the mayor at the time a “goddamned bastard.” (In those days there was no parliamentarian to rule him out of order.)

“I want Lake Elmo open, with nice parks and limited government,” said DeLapp. “When [the old council] was in the majority, they were giving away everything. The guy they fired [Zuleger] couldn’t be trusted. One day, he could be the nicest guy in the world and the next day he was ruthless — a guy just trying to pad his resume by dealing with developers.”

Council Member Jill Lundgren
MinnPost photo by Craig Lassig
Council Member Jill Lundgren

Back and forth it goes. Even when the players change, the tumult seems constant, so much so that it’s easy to just pass it all off as something like a joke, a nasty parody of small-town politics. Except that, for Lake Elmo residents, there are real, live consequences to the city’s political turmoil.

For example, some properties in and around Lake Elmo’s downtown are unsellable thanks to crumbling septic systems. After years of wrangling, a sewer system is finally being constructed in the area. But without new development, the burden of paying for the system falls on only a few. And the high costs, Schiltz fears, will force more business out and create more empty storefronts. His own Lake Elmo Inn might even be forced to close. 

***

“You have to have poop in the pipe,” said Smith. That’s her way of saying some growth is needed to make a sewer line viable.

She insists she’s not opposed to growth; she says she just wants it carefully managed.

But Mayor Mike Pearson says that the businesses that Lake Elmo needs to attract are being frightened off by the ugliness of city government.

“I think we have sent the message that we are difficult to deal with,” he said. “We have sent away the businesses that would be good for our community.”

Mayor Mike Pearson
MinnPost photo by Craig Lassig
Mayor Mike Pearson

The interesting thing about Smith and Pearson is that in one-on-one conversations, both are rational, easy to talk to. But put them in the same room — a council chamber, say — and you can feel the tension. Even with a parliamentarian there are snide comments, eye rolls, pointed statements.

“I can see where this is going,” muttered Pearson at a recent meeting where an issue was headed toward another 3-2 vote. 

“Funny,” says Smith, “I don’t recall any tyranny-of-majority signs when I was always on the losing end of 4 to 1.”

*** 

The feuding has consequences beyond Lake Elmo, too. The old council supported a half-billion dollar East Metro dedicated bus transit system that would have included a station in Lake Elmo. This system, years in the planning, would run from Oakdale to downtown St. Paul.

When the new majority took over, however, a new vote was taken on whether Lake Elmo should participate in the project. By a 3-to-2 vote, the Lake Elmo decided to oppose the Gold Line route, meaning the whole project must go back to the drawing board.  

“I’m not sure how remaining auto dependent helps you to maintain your character,” said Will Schroeer, executive director of East Metro Strong, a public/private organization which has been a strong advocate of the Gold Line. “It’s frustrating, but we will move forward. I think the question that they need to answer is whether they think traffic is going to get better or worse in coming years.”

Which points to a larger question: What does Lake Elmo owe its surrounding communities, if anything? Lake Elmo wants good roads, public help when environmental issues arise, grants to rebuild failing infrastructure. Does the community have a greater responsibility when it comes to issues such as growth and transit lines? Does any local community?

“There are benefits to living in the larger metro area,” said Smith. “I can live 10 miles from downtown St. Paul and experience the culture, the theater, the shopping, the jobs of the metropolitan area. Yet, at the end of the day, I can come home and live in a small, rural community. As for the moral responsibility: We offer people a choice. You can choose to live in a place like Woodbury. Don’t get me wrong, I love Woodbury, but we are different. We are one of the last rural places in the region. That’s worth taking care of.” 

Counters Pearson: “I love our community, but we are at risk of losing all we have if we don’t work with others. We can’t just bury our heads in the sand.”

And so it goes.

***

Nearly seven hours after it opened its meeting, long after the tussle over the awarding of a plaque, the Lake Elmo City Council got down to some serious feuding. The discussion was over the process of the hiring of a new city administrator. Apparently, Kristina Handt, formerly the city administrator in Scandia, has been hired. But the process rankled both Pearson and Bloyer.

“This has been a violation of opening meeting law,” said Bloyer. “These discussions have taken place behind closed doors. Everyone here knows it but no one is going to stand up and say it. This is the worst thing a government can do.” 

All of this was happening at about 2 a.m., meaning most in the once-crowded chambers had gone home. 

But of course, they really hadn’t missed anything. They’ve seen it all before. Surely they will see it all again. This is Lake Elmo.