Three days after the Raleigh City Council approved the final contract to purchase the Dorothea Dix property, three Republican state senators announced Monday that they’re dropping a bill to revoke the sale.
Senators Ralph Hise, Louis Pate and Tommy Tucker had argued that the $52 million price set by Raleigh leaders and Gov. Pat McCrory was too low. Their bill would have sold the 308-acre former psychiatric hospital campus near downtown Raleigh to the highest bidder.
The Raleigh City Council voted to approve the contract on Friday, and the Council of State – a group of the top statewide elected officials – will vote on it May 5.
Hise, Pate and Tucker had also sponsored legislation two years ago seeking to scrap a $500,000-a-year lease on the property signed by outgoing Gov. Bev Perdue in December 2012. While that bill never passed, it prompted a compromise agreement that gave McCrory time to negotiate a new deal with the city.
In a news release Monday afternoon, the senators said they “now believe many of their concerns will be addressed.” They said they’re pleased that McCrory’s final contract will put all money from the sale into a trust fund to be used for mental health services.
They also said McCrory has agreed to work with legislators to relocate the Department of Health and Human Services headquarters.
Tucker had complained last month that the property is “worth more than we’re being offered,” and he said the state will likely spend $100 million to build a new DHHS headquarters.
“We are grateful to Gov. Pat McCrory and his staff for their willingness to address many of our concerns and improve the agreement by helping the mentally ill and developing a plan for the future of the state agency that serves them,” the senators said in the release. “This action shows a spirit of cooperation between the General Assembly, the administration and the City of Raleigh.”
Asked if he now thinks $52 million is a fair price, Tucker said “the deal’s been on the table 10 years – it’s time for it to move.”
Most of the terms included in the final contract appeared in a three-page “term sheet” released in January when McCrory and Mayor Nancy McFarlane announced that they’d reached a deal.
But one new provision will put the state in a stronger position. In the January terms, Raleigh agreed to give the state a portion of proceeds from any future sale of the property.
The final contract goes a step further: the state will “share equally” in any revenue from a long-term lease on the property.
Raleigh is already hearing from at least one group seeking to lease some of the land.
According to email records released by the city Monday, a homeless shelter operated by The Healing Place of Wake County is looking to expand its facility on the Dix property. The nonprofit’s attorney wrote to city officials in March seeking a meeting.
After the Council of State vote next week, the Raleigh City Council must decide whether to hold a bond referendum on the sale. McFarlane has said the city could also borrow $52 million without putting the question to voters, but either option would likely mean a property tax increase.
The contract requires any referendum to be held this year. And the city must secure financing by Dec. 31 or the contract is canceled.
McFarlane said last week she thinks the deal with the state “will all work out.”