North Carolina’s top elected statewide leaders agreed Tuesday to lease prime urban property where a mental hospital stood for more than 150 years to the city of Raleigh to develop a park, rebuffing Republicans and their allies who questioned the deal’s timing and value.
A majority on the 10-member Council of State, comprised of outgoing Gov. Beverly Perdue, Lt. Gov. Walter Dalton and other leaders, voted to lease the 325-acre Dorothea Dix Hospital property tract to Raleigh for 75 years for up to $68 million over the period.
The Raleigh City Council followed up several hours later by voting formally for the agreement, setting the stage for a lease signing no later than Dec. 30.
Perdue, whose office has worked on fashioning a deal for about three years, said the transaction will benefit all of North Carolina while continuing to improve the quality of life in the fast-growing capital city, which will in turn attract companies to the region.
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“This is a good conservation investment as well as an economic development investment. I’m proud of the members of the Council of State,” Perdue told reporters after the vote.
Raleigh leaders and civic boosters have coveted the property for years, particularly after the state determined patients would no longer be treated at Dix. The last patients were transferred from Dix this past summer. A group announced Monday it had $3 million committed to create a master plan for what it called a “destination park” likened to those in bigger cities such as New York and Atlanta.
By comparison – Raleigh’s well-known Pullen Park, located 2 miles away from Dix – is 67 acres.
“To preserve this piece of land is huge,” said Gregory Poole Jr., chairman of Dix Visionaries group. “It’s once in a lifetime. Other cities would salivate to have the opportunity to preserve a piece of land in the center of the city.”
City council members voted 7-1 in favor of the agreement, which also includes an option to extend the lease by another 24 years. “We’ve worked a long time for this and they really do understand what a great thing it will really be for the city and the state,” Mayor Nancy McFarlane said.
But Republican leaders at the Legislature fought the deal for the past week, saying it was rushed and should be left until after Perdue leaves office in January for GOP successor Pat McCrory and the incoming General Assembly to review.
Senate leader Phil Berger, R-Rockingham, said his office will evaluate legal options to terminate the lease, which he said in a release was approved by Council of State members who “caved into political pressure at the expense of good sense.”
“It is a sad day for our state when leaders entrusted to protect the best interests of all North Carolinians give a valuable state asset to a chosen few for little in return,” he added.
The offices of McCrory and House Speaker Thom Tillis, R-Mecklenburg, had no comment Tuesday on the deal’s approval.
A memo released Monday by Berger’s office from the General Assembly’s nonpartisan professional staff said that when adjusted for inflation and other factors, the combined payments over 75 years would be equivalent to $22.6 million in present-day dollars. That’s less than recent appraisals of the property, the memo said.
“I believe that this is a raw deal for North Carolina taxpayers,” Labor Commissioner Cherie Berry said during the brief Council of State debate. Berry and Agriculture Commissioner Steve Troxler, the Council’s only two Republicans, were the only members to vote against the measure.
State Auditor Beth Wood, asked to abstain from the vote in part because she said she believed the transaction could become the topic of a future audit by her agency. Perdue didn’t vote, as is tradition on the council except in the case of a tie.
Other Democrats on the Council of State endorsed the project. Attorney General Roy Cooper said the state has entered into $1 leases with county governments in recent years for parkland and other recreational areas. With the Dix project, Cooper said, “we have state, local and private resources that are being joined here to create an extraordinary opportunity that will improve the quality of life for generations to come.”
About 1,800 state Health and Human Services employees still work in buildings on the Dix property just south of downtown. Under the lease terms, workers can remain there for up to 15 years while the state tries to relocate them. The city’s annual lease payment will be reduced based on the portion of the land occupied.
The lease also doesn’t earmark the state’s proceeds for mental health treatment programs. That’s something the Legislature would have to approve.
Perdue said the deal’s approval Tuesday, one month and one day before leaving office, had nothing to do with building her legacy: “It has to do with the future of this state.”