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HomeMy WebLinkAbout1988-12-28 Minutes• MINUTES OF A SPECIAL MEETING OF THE CITY BOARD OF DIRECTORS • A special meeting of the Fayetteville City Board of Directors was held on Wednesday, December 28, 1988 at 8:30 a.m. in Room 326 of the City Administration Building at 113 West Mountain Street, Fayetteville, Arkansas. PRESENT: Assistant Mayor Bumpass; Directors Martin, Kelley, Marinoni, Hess and Lancaster; City Manager Pennington, Assistant City Manager Linebaugh, City Attorney McCord, City Clerk McWethy; members of the staff, members of the press and audience. ABSENT: Mayor Johnson The meeting was held for the purpose of considering a resolution authorizing a 429. contract of sale for the purchase of the Medark Clinic Building, located at 207 `'E. Dickson Street, to be used as additional space for the City Library. Because the Mayor was out of town and because the Assistant Mayor had not yet 429. arrived, the City Manager suggested the Board select a Director to preside over the meeting. It was moved by Martin and seconded by Kelley that Director Ernest Lancaster'be 429. appointed presiding officer. Upon roll call, the motion passed, 5-0, Johnson absent from the meeting and Bumpass not present at this point in the meeting. 'ROLL CALL The meeting was called to order by Director Lancaster, with five Directors 429. present at roll call. PROPERTY PURCHASE Lancaster asked the Board to consider the purchase of the Medark Clinic Building 429. for use by the City Library. ,City Manager Pennington said the staff has been negotiating with the property 429. owner, and asked Linebaugh to present the recommendation. Linebaugh said:Dr. James Mashburn was the principal owner of the Medark Building, and had an appraisal done by James R. Sullivan, which resulted in an appraised value of $400,000. Linebaugh said there was a major error, however, in.the appraisal, in that it was based on 8,000 square feet, while the building has 7,006 square feet. Linebaugh said the City had an appraisal done by Cary Schultz which resulted in an appraised value of $320,000. Linebaugh said the staff has negotiated a purchase price with Dr. Mashburn of $360,000. Linebaugh recommended the Board approve that amount. December 28, 1988 130.1 Linebaugh told the Board the staff had considered an alternative of adding to the east side of the existing library by purchasing some property to the east of the library. He said the property was historical, and would create some problems. He estimated the cost of this to be $609,950. 130.2 Linebaugh said if the Medark building is purchased for $360,000, there would be additional costs for renovation. He estimated these costs to be around $150,000. 130.3 Linebaugh reported the Library Board met yesterday to review the matter and recommended to the City Board that the Medark Building be purchased for $360,000. 430.4 In answer to a question from Martin, Linebaugh said $500,000 is proposed to be spent in the capital improvements program for improvements to the library. Linebaugh said the purchase, if approved, would be contingent upon voter approval of a bond issue for the capital improvements program. He explained the.Library Board had $50,000 to put down as earnest money before December 31, allowing Dr. Mashburn to liquidate the company. He said if the bond issue is approved by the voters, the remaining money would be paid for the building. In answer to a question from Martin, Linebaugh said he understood the City would forfeit the $50,000 if the bond issue were not approved. 430.5 430.6 430.7 430.8 430.9 Linebaugh asked Mashburn if it was his understanding the total purchase price agreed upon was $360,000. Mashburn said two proposals had been made; one was to put $50,000 down as an Option, with a balance of $320,000 within a one-year period of time; with the other alternative being $50,000 down now, and they would sell the property for $360,000 between now and the end of the year. Mashburn said they were trying to close the corporation down between now and the end of the year for tax purposes. Mashburn added that Schultz also made in error in square footage, because he figured just the upstairs of the building, and didn't include the 1,224 square feet in the lower part in his appraisal. In answer to a question from Linebaugh, Mashburn said he had agreed to take $360,000 for the property, with $50,000 down now and the balance (of $310,000) after the bond issue election. In answer to a question from Marinoni, City Manager Pennington said the bond issue could not come to an election for some time, because the incinerator situation has to be closed down first. He estimated that issue would not be settled until March or April at the earliest. Linebaugh said the City's Land Agent, Bert Rakes, feels the negotiated price was a fair price. He said Schultz feels the property value of doctors' buildings in the downtown area is dropping tremendously because of a new medical center which will be built near the Bypass. Linebaugh said there is about 800,000 square feet of office space now in the area. Director Bumpass arrived at this point in the meeting. Director Martin said he recalled some sales tax revenues were proposed to finance specific items which would not require a bond issue. Martin said he favored a bond issue, but also didn't want to lose $50,000. He asked if the City would have the alternative, if they ran out of doing some interim financing with sales tax be no problem. December 28, 1988 time in floating the bond issue, of 431.: revenues. Pennington said that would City Attorney McCord said the Board was considering approval of a real estate purchase contract, with $50,000 earnest money and a closing date of May 1;`,1989; and if the bond issue is not approved, to use.interim financing from sales -tax revenues. It was moved by Martin that the City be authorized to enter into a purchase agreement with Dr. Mashburn for the Medark Building for a total of $360,000, with $50,000 down and the balance to be paid within one year. The motion was seconded by Kelley. Upon roll call, the motion passed, 6-0, Johnson being absent. RESOLUTION NO. 97-88 APPEARS ON PAGE OF ORDINANCE AND RESOLUTION BOOK • 431.: 431.