Raleigh City Council OKs deal to buy Dorothea Dix property

The City Council voted unanimously Friday to buy the Dorothea Dix property from the state of North Carolina for $52 million.

Councilman John Odom said he was happy to have the city purchase the 308-acre site near downtown Raleigh.

“The park ought to be in the control of the city of Raleigh,” Odom said. “Our parks system is one of the best, if not the best, in the country. We can make it what it ought to be.”

It’s still not a done deal until the North Carolina Council of State approves the agreement. A vote is expected May 5.

Gov. Pat McCrory issued a statement Friday praising the City Council vote.

“The Dorothea Dix property sale will allow the creation of a destination park in our state capital, protects the taxpayers and provides much needed funding for mental health services,” McCrory said.

The governor has said proceeds from the sale will go toward state mental health programs, a way to honor the site’s original use as a psychiatric hospital.

Under the terms of the agreement, the state would lease back from the city about 109 acres. The state Department of Health and Human Services would be able to remain on the Dix campus for as long as 25 years.

The city and the state would share in the cost of cleaning up contaminated soil on part of the site, up to $1.2 million.

If the city decided to sell or lease any of the property, the state would share in the proceeds for no longer than 17 years.

The city and the state would also agree to share parking lots and other areas on the campus for special events.

Some opposed

Raleigh Mayor Nancy McFarlane and McCrory announced in January that the state would sell the entire Dix property to the city for $52 million. The vote Friday was the city’s formal approval of the deal.

But a bill filed in March by three Republican state senators would essentially halt the agreement. Senate Bill 705 would put the property up for bid, using the state’s standard procedure for surplus property. Bidding would start at $52 million.

The bill is sponsored by Sens. Ralph Hise, Louis Pate and Tommy Tucker.

McFarlane said she thinks the deal with the state “will all work out.”

“The Senate and the governor really laid out the process we should follow in this ... and we followed it,” McFarlane said.

Joey Stansbury, a conservative activist with the Wake Citizens Coalition, said the City Council should not have decided on its own to move forward with the purchase.

Instead, Stansbury said, the city should put the issue in front of voters in the form of a bond referendum. He said Friday’s decision was “a continuation of the City Council and a few select downtown boosters once again pushing a deal without public input.”

Last fall, Raleigh voters approved $92 million in spending for the city’s parks system. The referendum could bring a potential property tax increase.

Stansbury said it’s still unclear how much it will cost the city to transform the Dix site into a park, and to maintain it.

“No one can present any idea of what they plan to do with the park,” Stansbury said.

Under the terms of the agreement, the city would perform site examinations before closing on the deal, partly to determine the best use for the property.

McFarlane said she doesn’t envision the city ever selling part of the property for private development.

Financing questions

She said it’s still unclear how the city will pay for the site. The council approved the purchase, she said, not a financial plan.

The contract is contingent on the city identifying a funding source by Dec. 31.

If Raleigh leaders choose to move forward with a bond referendum, according to the contract, the bonds would have to be approved by the end of the year.

“That is another issue we will take up later – how to finance it,” McFarlane said.

Raleigh and the state have been negotiating for years for the city to turn the former psychiatric hospital campus into a Central Park-style destination.

In 2012, Gov. Bev Perdue agreed to lease the land to the city, but legislators halted the deal in 2013. A compromise bill paved the way for McCrory to restart negotiations with the city.

In January, McFarlane said the coming years of planning for the park site will be a “community event.” She has pushed for the park for years.

The last patients left the psychiatric hospital in 2012, part of a larger restructuring of the state’s mental health system.

Now, Odom said he envisions a wonderful park at the site.

“I think in the end, 50 years from now for the next generation, it will be a good thing for the city of Raleigh,” Odom said.

This story was originally published April 24, 2015 at 11:41 AM with the headline "Raleigh City Council OKs deal to buy Dorothea Dix property."