The state Division of Motor Vehicles plans to move hundreds of workers and its headquarters from its long-time home on New Bern Avenue east of downtown Raleigh to Rocky Mount.
The DMV is seeking permission from the Council of State to sign a 15-year lease for part of the former Hardee’s headquarters on North Church Street, on the north side of Rocky Mount. The property is one of a dozen that real estate brokers and developers proposed for a DMV headquarters last fall and is the only one outside of Wake County or Research Triangle Park.
It was also the cheapest, according to information the state Department of Transportation provided to the Council of State. The DMV would pay an average of $2,053,635 per year over 15 years to rent 139,181 square feet of office and warehouse space, NCDOT told the council. The council is scheduled to decide whether to approve the lease at its regular meeting on Tuesday, Feb. 5.
State law compels agencies to go with the lowest bid if a property meets all its other criteria, which gave DMV no choice but to choose the Rocky Mount site, said NCDOT spokesman Jamie Kritzer.
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The lease would begin Jan. 1, 2020, 11 months before the agency must be out of its offices on New Bern Avenue under an agreement with the state Department of Insurance and the State Construction Office. In 2007, the state determined that those DMV buildings were no longer safe, because of asbestos and fire code violations, and the agency agreed to make minor upgrades if given five years to come up with a permanent solution.
The clock began ticking on Nov. 18, 2015.
It’s not clear if DMV’s move to Rocky Mount would be permanent. Kritzer noted only that the agency would have options to renew the lease for two additional five-year terms, for a total of 25 years.
Kritzer acknowledged that DMV has already heard grumbling from workers who don’t relish the commute to a new office an hour east of downtown Raleigh. As the move out of the city approaches, NCDOT will help DMV employees adjust, perhaps with options such as rideshare and other forms of public transit.
“This process will have its challenges and its opportunities,” Kritzer said in an interview. “DOT leadership will evaluate any negative impacts to its workforce and how best to navigate that process.”
Kritzer could not say how many workers would be affected. A state DOT report to the General Assembly last spring said about 646 people worked in the complex, but DMV Commissioner Torre Jessup said last summer that the number was closer to 500.
Raleigh Mayor Nancy McFarlane said Tuesday that she was upset about the loss of jobs.
“That’s a long commute to ask of people to keep their jobs,” McFarlane said in an interview. “I feel bad for the people who live near there and have been working there.”
State Sen. Dan Blue, a Democrat whose district includes the east side of Raleigh, said the DMV headquarters has been an economic hub for one of the poorest parts of the city. In a statement Wednesday, Blue said he opposes the move, both because of its impact on the community and for what it means for the DMV and the people who work there.
“These employees are some of the lowest paid workers in state government,” Blue said. “To ask them to take on the financial burden of a two-hour daily commute is punishing them to go to work every day. As a result, DMV will create additional morale problems, lower customer service and higher employee turnover rates.”
But House Speaker Tim Moore, a Republican from Cleveland County, west of Charlotte, called the planned move a “win-win” for the state, getting a cheaper lease in Rocky Mount, and for Raleigh, which will find it easier to redevelop the New Bern Avenue area.
“I know there’s concerns about employees driving and so forth,” Moore told reporters after the General Assembly reconvened Wednesday. But, he added, U.S. 64 going east of Raleigh is “one of the best roads in the state. So, you’ve got a great ability to get there. I think it will work out just fine.”
It’s not clear what the state will do with the property on New Bern Avenue, which covers nearly 6 acres. The main DMV headquarters building opened in 1957 and was expanded in 1966; a four-story annex was completed in 1981, bringing the total size of the complex to more than 210,000 square feet. The buildings could not be used without extensive renovations.
McFarlane said she’s heard there’s interest in redeveloping the site, but the state must first decide what it wants to do with the property.
The move does not include the license plate agency that operates in the ground floor of one of the buildings. The agency, now staffed by DMV employees, serves the Raleigh area and will remain in Wake though it’s unclear where.
After agreeing to leave its headquarters, DMV did not receive any money to build a new one from the General Assembly. Instead, the state budget approved last summer directed the DMV to begin seeking leased space in “Wake County and surrounding counties.” Among the proposals the agency received were four in Raleigh, two each in Garner and Research Triangle Park and one in Morrisville.
The Rocky Mount site is in Nash County, which borders Wake to the east.
“It has the basic needs for our operation,” Kritzer said. “It has the right space, and it was the right price — the lowest bid.”