State approves sale of Dix land to city of Raleigh

The Council of State has voted unanimously to sell the land near downtown Raleigh once occupied by Dorothea Dix Hospital to the city of Raleigh, which is planning a signature park on the property.

The vote Tuesday morning is the last major hurdle for the $52 million sale of the 308-acre property. The state will continue to have Department of Health and Human Services offices on the site for up to 25 years through a $1-a-year lease back to the state.

“This is not just a destination park for the city of Raleigh,” Gov. Pat McCrory said. “It’s a destination park for the state of North Carolina and its region.”

The contract comes after more than a year of negotiations between the McCrory administration and Raleigh officials. It replaces a cheaper lease negotiated by outgoing Gov. Bev Perdue that Republicans said was a bad deal for the state.

“Even when we hit certain dead-end spots, we agreed that we needed to keep this going,” McCrory said of the talks, which included disagreements over the price and who should clean up environmental contamination at Dix. “It’s roughly the middle point between the two appraisals completed by the state and the city. We weren’t going to let a few percentage points stop what’s best for the state and what’s best for the city.”

Next the city council must decide how it will secure $52 million. One option is a bond referendum, which would have to go before voters by the end of the year under the contract’s terms.

“We will start talking about financing options at our next meeting,” Raleigh Mayor Nancy McFarlane said Tuesday after the vote. “Our CFO has already been working on it – is there a difference in interest rates, is there a difference in how it works into our whole debt model?”

Planning the park is expected to take years. “This is the next chapter, and this is going to be just as much work if not more,” the mayor said. “I’ve had the most amazing list of things come across my desk, everything from a racecar track to casino to ultimate Frisbee to all kinds of things. It really is going to be a matter of what does everyone want to see, and the sky is the limit.”

The deal comes more than a decade after plans for the park were first discussed: When state officials announced in 2002 that Dorothea Dix Hospital would close, developers began dreaming of possibilities for the 308-acre campus just south of downtown.

One suggested a 10-story condominium building atop the hill, overlooking the skyline. Others envisioned high-end offices and homes. But a handful of neighbors wanted to keep bulldozers away from some of the biggest open spaces inside the Beltline.

“It functions as a park now, why can’t we make it a park?” Will Hooker, an N.C. State horticulture professor, recalls telling friends. “Several other people – better community organizers – took off and ran with it.”

Their 13-year quest to save the old psychiatric hospital property from private development culminated Tuesday morning. Gov. Pat McCrory asked – and on Tuesday received – the Council of State’s approval to finalize a $52 million sale to the city of Raleigh, which hopes to create its own version of New York’s Central Park.

The vote concludes years of political wrangling over the fate of Dix. Republican legislators said last week they’ll no longer seek to derail the deal and sell the property to the highest bidder.

Early backers of the park idea say they’re surprised the deal has taken so long. Former Mayor Charles Meeker threw his weight behind the plan in 2006, calling it “a bold vision for an exciting future.” But Meeker said he struggled to win support from Govs. Mike Easley and Bev Perdue before he left office in 2011.

“It just seemed like such a good idea,” Meeker said Monday. “I thought within a matter of months it would move forward.”

Here are some key dates as those months stretched to a decade:

Sept. 24, 2002: State officials announce they will build a new psychiatric hospital in Butner and close Dorothea Dix within six years. The decision would end more than 150 years of mental health care on the site and leave the land in limbo. Easley’s administration promises to “find the highest and best use of the property.”

Feb. 9, 2004: A study commission – made up of Meeker and five Wake County legislators – begins holding public hearings about various Dix development options. Then-Senate Majority Leader Tony Rand, a Democrat, says the site should be sold and “put on the tax rolls in some useful purpose.”

Oct. 27, 2006: Meeker calls for the city to create a nonprofit to buy the land for about $40 million through a combination of city funds and private contributions. That public-private approach was later scrapped. “The only entity with the resources to (buy the land) was the city,” Meeker said later.

June 14, 2007: Meeker issues a formal offer for Raleigh to buy Dix for $10.5 million. The move prompts laughter from Rep. Paul Stam, an Apex Republican, who calls it “an extremely lowball offer.” Stam says at the time that the pricetag “should probably be closer to $50 million.” He later supported the sale as negotiated by McCrory.

August 2012: The last patients move from Dix hospital to the new Central Regional Hospital in Butner. Meanwhile, the future of the Dix property remains uncertain. Perdue, a Democrat, backs the park idea, but the Republican-dominated legislature wants the final say.

Dec. 4, 2012: The Council of State votes 6-2 to approve a $500,000-a-year, 99-year lease negotiated by Perdue, who is about to leave office. Hooker, who has been pushing for a park for a decade, said later that Perdue shouldn’t have waited until her final month in office. “I was upset with Beverly Perdue for not making that deal earlier so it could have been finalized,” he said.

March 26, 2013: The N.C. Senate votes 29-21 along party lines to scrap the lease and restart negotiations over the property’s future. Republicans say the lease agreement doesn’t represent “fair market value” and shortchanges the state’s mental health needs.

July 22, 2013: Lawmakers agree to give McCrory and Raleigh officials a year to reach a new deal. The deadline is extended repeatedly as the two sides struggle to agree on how much the property is worth and who should pay for environmental cleanup on the site.

Jan. 12: McCrory and Raleigh Mayor Nancy McFarlane announce the terms of the current, $52 million deal, which McFarlane calls “a win-win for all of us.”

March 26: The same Senate Republicans who opposed the Perdue lease file a bill seeking to sell the land to the highest bidder. They argue the property should garner more than $52 million, and the state shouldn’t pay any clean-up costs.

April 24: The Raleigh City Council votes unanimously to approve the final contract for the $52 million purchase.

April 27: The three senators withdraw the bill, removing one of the final hurdles for the sale. “The deal’s been on the table 10 years,” Sen. Tommy Tucker says. “It’s time for it to move.”

This story was originally published May 5, 2015 at 9:20 AM with the headline "State approves sale of Dix land to city of Raleigh."