2000-12-13 Special Meeting
NEW HANOVER COUNTY BOARD OF COMMISSIONERS BOOK 28
MINUTES OF SPECIAL MEETING, DECEMBER 13, 2000 PAGE 349
DISCUSSION OF PROPERTY ACQUISITION FOR
NEW HANOVER COUNTY SCHOOLS
ASSEMBLY
The New Hanover County Board of Commissioners met in Special Session on Wednesday,
December 13, 2000, at 4:00 P.M. in the Assembly Room of the New Hanover County Courthouse,
24 North Third Street, Wilmington, North Carolina.
Members present were: Chairman Ted Davis, Jr; Vice-Chairman Robert G. Greer;
Commissioner William A. Caster; Commissioner Nancy H. Pritchett; County Manager, Allen O’Neal;
Deputy County Attorney, Kemp Burpeau; and Clerk to the Board, Lucie F. Harrell.
Commissioner Julia Boseman was absent due to a scheduling conflict.
Chairman Davis called the meeting to order and welcomed Mr. Ed Higgins, Chairman of the
Board of Education and Dr. John Morris, Superintendent of New Hanover County Schools. He
requested County Manager O’Neal to begin the presentation on acquiring property for the School
System.
County Manager Allen O’Neal, reported that the Board of Education, in a Closed Session last
week, notified the County Commissioners of its interest in securing a piece of property on Carolina
Beach Road for school administrative purposes. He advised that Mr. Higgins and Dr. Morris would
explain the reason for the request and informed the Commissioners that Deputy County Attorney
Kemp Burpeau would comment on the County’s role in acquiring property according to North
Carolina General Statutes.
Deputy County Attorney Burpeau explained that according to General Statutes the term
“school site” includes not only buildings for academic purposes but also for administrative uses. The
Special Session has been called for the Board of County Commissioners to hear the land acquisition
presentation by the Board of Education and to determine if the price is reasonable, and if so, approve
the purchase.
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On behalf of the Board of Education, Chairman Higgins requested permission to spend $2.5
million to purchase a 36,000 square-foot building on Carolina Beach Road for the purpose of moving
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some of the administrative offices in the Spencer Building located at 1802 South 15 Street to the
new structure. The property is in both foreclosure and bankruptcy, and the Board of Education has
prepared an offer to purchase the property. The bank is prepared to release its lien against the
property and transfer the title of the personal property in the building valued at $2.5 million to the
Board of Education. In order for this to be accomplished, the Bankruptcy Court must consent to a
private sale. The Board of Education has been advised that the Bankruptcy Court has agreed to
expedite a hearing on this matter, tomorrow morning, December 14, 2000, at 11:00 A.M.
The contingency in the Board of Education’s offer is that the price must be approved by the
Board of County Commissioners and the Board of Education. At an open meeting last night,
December 12, 2000, the Board of Education voted to proceed with the purchase contract, and meet
with the Board of County Commissioners for authorization to spend this $2.5 million.
A copy of the resolution signed by the Board of Education was presented to the County
Commissioners with an explanation of how the $2.5 million would be appropriated. The following
budget amendments reflected that $1 million would be removed from the fund balance reserve, which
will leave adequate operating funds and contingency funds for the coming year. The remaining $1.5
million is money that was previously appropriated by the Board of County Commissioners for the
Spencer Building renovation project. This project included some renovations to a building known as
the Annex Building. The Board of Education is requesting the County Commissioners to allow the
$1.5 million to be used to acquire the Carolina Beach Road property rather than for renovation
purposes. With the purchase of this property, the Annex Building will be vacated as an office, and
used primarily for storage. The functions currently being conducted in the Annex Building will be
moved, as well as the offices of Finance, Personnel, Superintendent and Deputy Superintendent of
Schools. The existing Spencer Building will be used primarily for staff training and meetings and
hearings of the Board of Education.
NEW HANOVER COUNTY BOARD OF COMMISSIONERS BOOK 28
MINUTES OF SPECIAL MEETING, DECEMBER 13, 2000 PAGE 350
DISCUSSION OF PROPERTY ACQUISITION FOR
NEW HANOVER COUNTY SCHOOLS
Board of Education Budget Amendments:
Budget Amendment #4
New Hanover County Administrative Unit
Capital Outlay
Code No. Description of Code Increase Decrease
4.9149.401.529.352.945 New Central Office Building $2,500,000
4.9196.401.522.000.945 00/01 Spencer project $1,500,000
Revenue:
4.4922.000.000 Transfer from Local Current Exp. $1,000,000
Explanation:
To set up budget for purchase of New Building
Total Appropriation in Current Budget$106,054,325.25
Amount of Increase (Decrease) of above Amendment 1,000,000.00
Total Appropriation in Current Amended Budget$107,054,325.25
Budget Amendment #5
New Hanover County Administrative Unit
Local Fund
Code No. Description of Code Increase Decrease
2.8100.000.714Transfer to Capital Outlay $1,000,000
Revenue:
2.4910.000.000 Fund Balance Appropriation $1,000,000
Explanation: To appropriate Fund Balance & Transfer to Capital Outlay for purchase of New
Building.
Total Appropriation in Current Budget$55,832,113.12
Amount of Increase (Decrease) of above Amendment 1,000,000.00
Total Appropriation in Current Amended Budget$56,832,113.12
Chairman Davis asked if there were any back taxes owed on the property.
Deputy County Attorney Burpeau responded that roughly $30,000 in back taxes was owed.
Chairman Higgins advised that Central Carolina Bank (CCB) had informed the Board of
Education that $50,000 in back taxes is owed. However, CCB holds the mortgage and wants to clear
$2.5 million net with no deductions. This means that the Board of Education will prepare the deed,
pay revenue stamps, recording fees, and back taxes. These items will also be removed from the fund
balance.
Chairman Davis asked if the Board of Education voted unanimously to purchase the property.
Chairman Higgins responded that Mr. Hayes was absent and the remaining members voted
to move forward with the purchase.
NEW HANOVER COUNTY BOARD OF COMMISSIONERS BOOK 28
MINUTES OF SPECIAL MEETING, DECEMBER 13, 2000 PAGE 351
DISCUSSION OF PROPERTY ACQUISITION FOR
NEW HANOVER COUNTY SCHOOLS
A lengthy discussion was held on the location of the new building and the use of the Siemens
Building, which was purchased several years ago for administrative office purposes. Chairman Davis
spoke on receiving numerous calls from concerned citizens about spending $2.5 million for an
administration building located in the southern part of the County which is not served by public
transportation, and he asked if the Board of Education had received complaints.
Superintendent Morris responded that the Siemens Building did remain vacant for a number
of years and advised that this structure now houses the entire Maintenance, Grounds, Transportation,
Purchasing and Technology Departments. This facility also serves as a warehouse for all building
supplies and storage for surplus property to be auctioned once a year. The Siemens Building has been
an ideal building for its current uses. Superintendent Morris also pointed out that the new building
is close to Veterans Park where a large number of students and activities will occur on a daily basis.
In concluding his remarks, Superintendent Morris stressed the importance of everyone
understanding that the Annex Building has been infested with rats and bugs over the years and is in
a deplorable condition. He stated that discussion was held by the Board of Education about
proposing a bond issue for a new building; however, it was estimated that constructing a building of
this size would cost $4 million instead of the $2.5 million, which is a significant savings. He advised
that currently 3 to 4 people are sharing one administrative office and stated that with the condition
of the building, both the Board of Education and Staff feel that purchasing the new building on
Carolina Beach Road will be the most efficient use of County resources.
Discussion followed on whether there was public transportation to the new building. County
Manager O’Neal advised that the Wilmington Transit Authority does not have a route beyond
Monkey Junction. The New Hanover County Human Services Transportation System has a route
for elderly and handicapped persons that operates three trips per day to the Masonboro Commons
Shopping Center at the Food Lion arriving at 9:15 A.M., 11:30 A.M., and 2:03 P.M.
.Discussion was held on the appraisal of the property. Chairman Higgins advised that an
appraisal was performed six months ago with a value of $2.8 million; however, the most recent
appraisal was $2.4 million. The reason for the low appraisal was because the building has remained
empty for two years. If the property is purchased, the School System will receive at least $75,000
worth of equipment, workstations and other personal property. The projected construction cost of
a new building ranges from $100 to $120 per square feet for 36,000 square feet (not including an
elevator and other needs), which would bring the total cost to between $3.6 and $4.3 million. The
proposed cost of $2.5 million for the Carolina Beach Road building will save a considerable amount
of money.
Commissioner Pritchett asked if the Board of Education has any plans to renovate the Annex
Building in the future.
Superintendent Morris responded that no improvements would be made to the Annex
Building in the foreseeable future, but the building is suitable for storage. Ordinary maintenance will
have to be performed to ensure the safety of records from rodents and bugs.
Commissioner Pritchett referenced the article in the newspaper about the condition of the roof
on the new building and she requested Dr. Morris to comment on this issue.
Superintendent Morris responded that some flashing on the northern side of the building was
pulled up and a few lamps were leaning due to the last hurricane. He advised that three engineers
from the School System walked through the building and could not see any damage; however, an in-
depth inspection is being conducted, and the offer to purchase is contingent upon this inspection.
Commissioner Pritchett asked if they would be occupying all of the reasonable office space
or if there would be room to expand for a few years.
NEW HANOVER COUNTY BOARD OF COMMISSIONERS BOOK 28
MINUTES OF SPECIAL MEETING, DECEMBER 13, 2000 PAGE 352
DISCUSSION OF PROPERTY ACQUISITION FOR
NEW HANOVER COUNTY SCHOOLS
Superintendent Morris responded that the new building will be full upon occupancy. The
Staff Development Department, Child Nutrition Department and a few others will remain at the
Central Office in the Spencer Building.
County Manager O’Neal reported on an issue of non-compliance regarding the builder and
he requested Deputy County Attorney Burpeau to explain this situation.
Deputy County Attorney Burpeau explained that approximately 18 months ago, he placed on
record a notice stating that Chase Dillon Mortgage was not in compliance with Water and Sewer
District regulations and connections. If the Commissioners approve this purchase, authorization will
have to be given to cancel the notice of non-conformity before the Board of Education purchases the
property.
Vice-Chairman Greer requested clarification on the language referencing the “transfer from
local current expenses.”
Chairman Higgins explained that when the Board of Education adopted the resolution, the
Finance Officer recommended changing the wording to transfer the money into local current expenses
so that it can be moved to capital outlay.
Chairman Davis asked if there were any further comments from the members of the Board.
After hearing no remarks, Chairman Davis requested a motion.
Motion:
Commissioner Caster MOVED, SECONDED by Commissioner Pritchett, to approve the
purchase and authorize the Legal Department to cancel the notice of non-conformity. Upon vote,
the MOTION CARRIED by a 4-0 vote.
ADJOURNMENT
On behalf of the Board, Chairman Davis expressed appreciation to Chairman Higgins and
Superintendent Morris for the presentation, and he called for a motion to adjourn.
Motion:
Commissioner Pritchett MOVED, SECONDED by Commissioner Caster, to adjourn the
meeting. Upon vote, the MOTION CARRIED 4 TO 0.
Chairman Davis adjourned the meeting at 5:15 P.M.
Respectfully submitted,
Lucie F. Harrell
Clerk to the Board