Back to: Investigates
January 03, 2018 10:13 PM

A Legacy Project Denied State Loan

Sioux Falls, SD

His name will forever be synonymous with the Copper Lounger Building collapse.  And in recent weeks we've learned Aaron Hultgren is the subject of a criminal investigation and was fined by the state for not removing asbestos from the building properly. 

The City of Sioux Falls solution to the controversy over having Aaron Hultgren of Legacy Developments as a guarantor of a new $50 million mixed-used parking ramp was to take his name off the contract and replace it with Jeff Lamont of Aberdeen.

Lamont just formed a new limited liability company for the project, although Norm Drake and other Legacy Development partners remain as guarantors on the project with the City.  

But just what do we know about this new limited liability company and even if Aaron Hultgren's name isn't on the project, does he remain a part of it?

KELOLAND Investigates looked into Lamont's LLCs, as well as some unusual happenings surrounding another project where Legacy is a major investor. 

You asked and we looked into it:  The first thing you need to know is that finding who is behind an LLC is virtually impossible.  South Dakota state law does not require members of an LLC or board of directors to be divulged. 

In the case of Village River Group LLC, which was just formed on December 28th, Jeff Lamont of Aberdeen is the manager and will be running it.  But that doesn't mean there aren't other members. 

We just can't find out who they are.  We emailed the City's Director of Community Development Daren Ketchum about who makes up the Village River Group. He says the City does not request that information. 

That means anyone could be a part of it, including Aaron Hultgren, we just don't know.  We've also asked Aaron Hultgren and Norm Drake of Legacy Developments if they are involved in Lamont's LLC, but they didn't respond to our questions either. 

We do know that Lamont has registered some 92 LLC's with the Secretary of State's office. Nearly 70 of those are active and they appear to be for retail projects, strip malls, apartment buildings and other developments. 

It's also interesting to note that Hultgren Construction, which Aaron Hultgren later changed to AH LLC, is currently delinquent in its filings with the Secretary of State' office. 

Meanwhile there is a new development in a Legacy project.  Win Chill, a $40 million  refrigerated food distribution center, is the first business going into Sioux Falls Foundation Park.  Legacy Developments is one of the major investors in the project which broke ground last summer.

"If you're not taking risks, if you're not investing in your communities or your state, if you're not preparing for the next big thing, it's passing you by," Sioux Falls Mayor Mike Huether said on June 22, 2017. 

Even in the frigid cold, work continues on the refrigerated building. But funding could soon become an issue. 

Last month, after a South Dakota Board of Economic Development committee approved a $5 million loan for the Win Build LLC. Days later, the board suddenly reversed its decision on the REDI Fund loan and denied it. 

We asked Scott Stern who is Commissioner of the Governor's Office of Economic Development why the loan was denied. 

In a statement Stern said: "This was the board's judgment based upon confidential business information. It had no connection to the Copper Lounge matter."

The Department of Environment and Natural Resources fined  Aaron Hultgren and Norm Drake for improper asbestos removal in Copper Lounge; a fine of $20,000 that was suspended when they couldn't pay it.

Again both Drake and Hultgren are partners in Legacy and Legacy is a major investor in Win Chill. 

© 2018 KELOLAND TV. All Rights Reserved. 

This article has been revised to reflect the following correction: Aaron Hultgren is the subject of a criminal investigation and was fined by the state for not removing asbestos from the building properly. A previous version of this story had a typo in this sentence.

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