City weighs breach-of-contract suit against Rowley Masonic Home

A development agreement between the Rowley Masonic Community Board of Directors and the city of Perry for the building of 28th Street was signed in 2013.

The $20 million addition to the Rowley Masonic Community opened in February 2015.

The city of Perry plans to file suit for breach of contract against the Rowley Masonic Community in July, alleging the local long-term care facility violated the terms of a 2014 development agreement for sharing the cost of building 28th Street.

“As of July 1, they’ll be two years behind on their payments,” Perry City Administrator Sven Peterson told the Perry City Council Friday morning at the special meeting marking the end of the fiscal year. “We’ve been trying to work with them and haven’t had any resolution, so Mr. Dalen is going to start the process to file a petition.”

Construction of the $20 million, 72,000-square-foot addition to the Rowley Masonic Community began in January 2014, and residents moved from the old to the new facility in February 2015. The development agreement with the city called for about $270,000 in payments from the Rowley spread over 10 years.

“Basically, they’re paying what it would have cost them to put in a driveway,” Peterson said. “The city picked up the difference between them having a driveway and us developing a street all the way through.”

Peterson told the council timely payments were made for the first few years of the agreement but then stopped.

“Through the whole process, I’ve really gotten no communication back in trying to reach out to them,” Peterson said. “I’ve had a couple of times when they say, ‘Yeah, we’ll get you paid by this time,’ and that time comes and goes, and nobody reaches out or says anything.”

Continuum Health Care Services took over operation of the 57-bed Rowley Masonic Community in the summer of 2015. A management shakeup occurred in November 2018, and the Minneapolis, Minn.-based Health Dimensions Group (HDG) took over operation of the facility.

“Talking with the mayor and Mr. Dalen,” Peterson said, “we felt probably the best course of action would be to start the process of that breach of contract. That will be going forward, so sometime in July we will get that filed. On July 1 they’ll owe a third payment sometime in that fiscal year, so if they can bring it up to date, we will call off that process.”

Spokespersons for the Rowley Masonic Community Board of Trustees and HDG were unavailable for comment Friday.

The Rowley Masonic Community is operated by a board of directors through the Grand Lodge of Iowa, with a trust agreement administered by the District Court of Dallas County  and Otley Lodge #299 AF&AM.


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