08/31/13 — Council agenda set for meeting

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Council agenda set for meeting

By Matt Caulder
Published in News on August 31, 2013 10:46 PM

Hours before the deadline passed for the upset bid process on the former Arts Council of Wayne County property, a counter-offer of $630,050 has come in from Pear Properties, LLC topping The Little Bank's updated offer of $600,000.

Pear Properties is a real estate management firm operating out of Kinston.

The bid will be put out for the upset bid process Tuesday and will have to come back to City Council at its Sept. 16 meeting -- if another offer is not made.

If accepted, the offer would still fall well short of the funds put into the property.

The costs of the project so far, from buying the property to demolition, total $935,277.47.

If the building is sold for the updated offer price, the city occupancy tax fund, which paid for the acquisition and work done to the building, would still take a $300,000 hit.

The occupancy tax fund is financed through the hotel tax. Revenue collected from the tax is split equally between travel and tourism marketing and the proposed construction of a convention center.

If a convention center is not feasible, then the funds will go to a different travel and tourism-based project.

"Nobody's tax rate is going to go up in the city for that project," City Manager Scott Stevens said.

The largest elements in the cost of the building and property were the acquisition of the property from the arts council for a little more than $500,000 as well as the consulting fees for a feasibility study on an Air Force museum costing $163,500 and the demolition costs of almost $220,000.

"Part of (the total spent on the property) is an unfair part because the study on the Air Force museum could have been done anyhow," Stevens said. "We don't equate that cost to that property."

Stevens said the study still has value to the community -- in case officials decide later to pursue the project. There is no current effort to restart the Air Force museum project.

Stevens said for him the money put into the former arts council property is a little more than $700,000 -- after deducting the cost of the study.

Stevens also said the money the city will make on the sale of the property intended for the convention center on Wayne Memorial Drive will far outweigh the loss on the arts council property.

The city purchased the Wayne Memorial Drive property at the corner of New Hope Road in 2001 for $2.2 million. It is appraised at $3.1 million.

Stevens said that while the city is not in the property buying business to make money, in this case, on the two purchases together, the city will come out OK.

The city decided earlier this year that a museum would simply be too expensive after hearing from the consultant that the pricetag would be an estimated $7 million.

The idea to renovate the building was scrapped and the property put up for sale after the City Council's February retreat.

The decision was made to demolish the building and freestanding silo structure in May to make the property more attractive to a prospective buyer.

Council believed the property would not sell with a building on it that needed extensive renovations or that needed to be demolished.

The city awarded the $197,000 contract for asbestos removal to A K Grading and Demolition. That cost increased by $22,500 when the contractor found more asbestos.

Councilman Bill Broadaway said he was happy with the offer from The Little Bank, but that a higher offer makes him happier.

He said the city might take a loss on the project, but added that he doesn't regret the city working to see if the museum would work.

"It's the cost of doing business," Broadaway said.

During the City Council work session beginning at 6 p.m. Tuesday night in the large conference room of City Hall, Council will discuss the designation of a voting delegate for the North Carolina League of Municipalities.

The delegates are currently Stevens and Mayor Al King.

On the consent agenda Tuesday night will be the possible approval of a hookah lounge to be opened in the former Kwik Stop at the corner of Ash and Durant Streets.

A hookah is a water pipe used for smoking flavored tobacco called shisha.

Also up for approval are two cemetery site plans and an Internet sweepstakes cafe at the former Teasers location on Highway 117.

The establishments are allowed in Goldsboro with a conditional use permit and an inspection of the property.

A request from the planning commission is coming back to council to defer a decision on the re-zoning of Busco Beach properties controlled by Smart Investors, LLC off of Bryan Boulevard.

A council action is required 90 days after a public hearing necessitating a council action to defer a decision on the re-zoning effort until the next planning commission meeting.

The questions concerning activities on the properties as well as other alleged violations came following a complaint by a Bryan Boulevard citizen.