Questions arise over Town Hall purchase
Accusations that town staff mishandled information leading to the purchase of Town Hall – the Town of Truckee’s biggest purchase since incorporation – have surfaced following closed session discussions between town staff and Town Council.
A letter dated Jan. 27, 2000 that described a lease with an option to leave after three years was delivered to the town, but the letter was not presented to Town Council prior to the purchase of the building last May.
“We went forward with the single biggest purchase in the town’s history with only 50 percent of the story,” alleged Town Council member Maia Schneider.
A proponent of moving Town Hall to the downtown core area, Schneider said Town Council did not adequately question staff over potential interim Town Hall solutions, and further accused staff of deliberately withholding information that may have imposed upon the rights of others.
“There was a buyer for that building. The town may have precluded that from happening,” said Schneider. “I feel very strongly we should not compete against our property owners for tenants, and we have a distinct advantage as a government entity.”
The decision to purchase the building owned by US Bank of the West for roughly $6 million established the Town of Truckee as the area’s biggest office space property owner and situated Town Hall within shouting distance of the county line.
Town Manager Stephen L. Wright said the lease information was presented to Town Council in advance of the decision to purchase the building during discussion regarding the financial differences between leasing vs. purchasing.
“What we presented to the council was multiple lease options,” Wright said. “We presented lease numbers vs. purchase numbers. We did not present the council with specific offers.”
“Wright did mention leasing and it wasn’t that good a deal. Purchasing the building was the superior option,” said Bob Drake, a Town Council member. “I approved of the purchase and I still do.”
None of the Town Council members said they saw the letter before deciding to purchase the building, but they all said they discussed the option of a lease.
However, both Drake and Councilman Ron Florian said they would have to examine the offer further to determine whether or not the letter would have changed their decision to purchase the building.
“Unless it was such a boon – such a phenomenal deal – it wouldn’t have changed my decision.” Drake said.
Andy Otto and Steve Carpenter were the office space consultants hired by the town to determine options for moving town offices out of the Truckee Donner Public Utility District and into a new building last year.
In a meeting Jan. 26, 2000, the consultants presented five options for meeting immediate and long-term needs. One of the options was a lease.
Although Otto and Carpenter were not familiar with the letter describing the lease, after reviewing the opportunity this week both said it was typical of the lease opportunities considered by the council last year.
Tom Watson, the agent from Truckee River Associates who sent the letter, describes the lease opportunity as anything but typical, and referred to the kick-out option after three years combined with financial advantages if the town left within five years as a golden ring.
“We gave the town the opportunity that they said they didn’t have,” said Tom Watson referring to the meeting, Jan. 26, 2000.
Watson and his client Richard Scardigli structured a deal for $1.40 per square foot with additional charges. It would allow the town to stay for as little as three years or as long as 10 years, but without consumer price index increases if the town moved within five years.
The deal would have required that Bank of the West sell to Scardigli, who would then present the lease agreement to the town.
“We had the option to become owners vs. leasers,” said Josh Susman, a council member. “Building equity for the town was the right thing to do.”
“If it is temporary … the town didn’t lose anything (with the purchase),” Drake said. “We could sell it … presumably for a profit.”
However, with ownership may come an added reluctance to move again in a few years, especially now that the Truckee Police Department has found adequate space in the new building.
“There is no incentive for the town to carry through on its promise to get a new building in downtown Truckee even though it is part of the General Plan,” Schneider said.
But Town Council will have the opportunity to reassess its decision to investigate opportunities to move to the downtown area in the future. Wright said the council will reassess its annual priorities this week, which will include discussion of Town Hall.
“Yes, there was some dissension later,” said Mayor Don McCormack in regards to whether or not council should have seen the letter prior to making a decision over the Town Hall building. “I think we felt it would have been better. But at the time we didn’t seriously consider it.”
Mayor McCormack supports the decision to purchase the Airport Road building both from an economic standpoint and from the necessity to expand. “We are now in the position of using the building for the police department.”
Town Council disagree as to the proper location of Town Hall, but most support the idea of moving to the downtown core area.
“Anytime you move Town Hall you’re not going to please everybody,” Florian said.
“Our goal is to move it downtown.”
Josh Susman and Mayor McCormack are part of a subcommittee looking into the Old Mill as a potential site for Town Hall.
As well, the Town of Truckee continues to fund a reserve account for Town Hall purposes.
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Police Chief Randall Billingsley was sworn in to start off Tuesday’s Truckee Town Council meeting.