North Adams City Council OKs purchase of property for new DPW
NORTH ADAMS — The city's public service departments could soon have a new home.
The council voted 7 to 1 to authorize Mayor Richard Alcombright to enter into a purchase and sale agreement with the owner of 59 Hodges Cross Road, which would become the new home of the city's public services should the deal be finalized.
"This makes sense for the city. Ideally, would I love to see a brand new building? Absolutely. But at this point in time, I think this is the best solution for the city," said Councilor Ronald Boucher.
Tuesday's decision came after meetings on consecutive nights — the City Council's Finance Committee discussed the proposal Monday and recommended it be approved to the full council by a vote of 2-0, with Chair Lisa Blackmer abstaining.
The main point of concern amongst some councilors and members of the public wasn't the plan to use the former Berkshire Anodizing facility to house the city's public services, but rather the price tag.
Mayor Richard Alcombright proposed last month that the city purchase the 85,000 square foot former manufacturing facility from 59 Hodges Cross Road LLC, for $995,000. The purchase would be followed with $350,000 in capital upgrades and $107,000 for repairs.
The entire $1.4 million project would be funded with a United States Department of Agriculture loan, Alcombright proposed, which would come with an annual payment of about $55,000 for the 40-year term.
The funding will be voted on separately by the council, noted Councilor Keith Bona.
"In the meantime, something can come up, and the council can hold back from funding if we wanted to ... approving this is not our final OK," Bona said.
The mayor introduced the proposal as a solution to the city's aging public services infrastructure, which includes a Department of Public Works facility on Ashland Street that several councilors described as unsafe and "deplorable." The Hodges Cross Road facility would house the Department of Public Works, Cemetery Department, Parks and Recreation, and more, all under one roof.
"This is the best long-term solution for the city," Alcombright said Monday.
The cost to renovate the Department of Public Works facility alone would be in excess of $2.7 million, according to city officials. Should the DPW leave, the building would be sold, Alcombright said, and the revenue from the sale could be used to pay down the debt on the new facility or toward another project.
Still, councilors and members of the public have questioned the market demand for an 85,000 square foot manufacturing facility, and wondered why the city should not go back to the seller and request a lower price tag. The current owner purchased the property in 2010 for $600,000, several noted.
"I can't agree with it just because of the purchase price ... from my own experience, I think the price should have been less, you could negotiate," said councilor Robert Moulton Jr., who opposed the proposal.
Blackmer said Monday that she wants an appraisal done on the facility before the city purchases it, and reiterated concerns with the price on Tuesday, but ultimately supported the proposal.
"I think this is what we're going to have to do, because we have to solve this problem," Blackmer said in supporting the proposal.
The owner of the Hodges Cross Road facility was the only respondent to a request for proposals the city issued earlier this year. City officials told the council they had explored other options, including building a facility near the Transfer Station on E Street, but none were as viable as the Hodges Cross Road location.
Alcombright contended the purchase was different from a typical real estate investment for a private business or homeowner.
"We're buying a solution for the city ... in my mind, the value is the solution," Alcombright said Tuesday.
City officials noted that the owner replaced a 50,000 square foot section of the building's roof in 2012, which comes with a 15-year warranty. They also contended that the city negotiated other aspects of the agreement, such as what equipment would stay at the site.
Alcombright also argued that while the recorded price of the land sale was $600,000, the owner paid $1.132 million for the business. The city's purchase price, Alcombright said, "is reflective of what he paid for the business."
Bona compared the price tag of the Massachusetts College of Liberal Arts' facilities building on Ashland Street, which cost more than $3 million to build and is smaller than the Hodges Cross Road facility.
Similarly, Councilor Joshua Moran liked how the proposal, which would cost about $17.60 per square foot, stacked up against similar projects in Berkshire County, noting four sites that are smaller in size but cost more.
"This generic 'we can do it cheaper somewhere else or we can do it at a comparable cost,' is false ... $17.60 is a bargain," Moran said, adding that a line item should be placed in the budget for building maintenance "so we don't do this again."
The building has been appraised at $1.15 million, according to Nathan Girard, who works for Greylock Realty, which represents the seller. Girard suggested Monday it could be valued in excess of $1.5 million if reappraised.
"There's been eight like buildings sold since the end of 2014 in Berkshire County," Girard said Monday. "The typical building price is $22.26 per square foot, in poor to average condition."
The project includes potential revenue sources, but neither are a guarantee and are not being counted on to fund the project by either the council or the administration. A proposed solar array on the property would bring in more than $20,000 in annual revenue. Another section of the land would be used to expand Hillside Cemetery, which would bring in additional revenue to the city's cemetery department, according to city officials.
The council also had to weigh the impact of losing tax revenue on the privately-owned Hodges Cross Road building, which amounts to nearly $60,000 annually. Moulton expressed concerns that the city would be losing tax revenue and the potential for future jobs should a private company purchase the facility.
Although, following a previous meeting, it briefly appeared as though the city may have retained rights to part of the property — and could potentially take it back for no cost — the city solicitor advised this week that the statute of limitations on enforcing that part of the deed had expired in 2010.
Contact Adam Shanks at 413-496-6376