Editorial — Building agreement doesn’t pass the test

February 6, 2015

By Staff

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The Newcastle City Council agreed to spend $250,000 on a building it could get for free.

Let us repeat that — $250,000 of taxpayer funds spent on a maintenance operations building that could be had for nothing, well, mostly nothing.

It doesn’t make much sense, does it?

But that’s what the council narrowly agreed to with the recent 4-3 approval of the purchase-sale agreement to acquire a Coal Creek Utility District-owned building.

Sure, on the surface, it looks like a good deal — “I only have to pay $250,000 for a $750,000 building? What a steal!” — but more and more, this agreement is starting to feel like an iceberg. It’s what’s underneath the water that you should be worried about.

The ominous, below-the-surface obstruction is the 10-year non-assumption agreement that comes with the purchase.

For the next decade, the city agreed to forfeit its legal right to take control of the utility district, and what’s worse, the council approved it without really knowing what assumption means.

There was no analysis, no study of what assumption could bring the city financially. Is assumption a good thing? Is it a bad thing? The council truly doesn’t know, and yet, it agreed to dismiss the possibilities for the next 10 years.

We understand that assumption wouldn’t be completely free. There are filing, processing and legal fees that come with it. But under assumption, the city would be acquiring so much more than just the $750,000 building.

Who knows where the city will be in a decade, or what the City Council will look like, but it seems short-sighted to bind the hands of Newcastle’s future public officials by taking away this choice.

Furthermore, the city will pay for the building with monies from the cumulative reserve fund, a fund that is to be used “for capital purchases or for operating shortfalls due to unforeseen cost increases or unanticipated revenue losses.”

Last we checked, the city has been performing admirably without the building. What unforeseen circumstances make this purchase necessary now?

As former City Councilman Bill Erxleben said at the Jan. 20 meeting, this fund should not be used for capital “nice-to-haves.”

That leads us to the true requirement of the purchase. We’re not truly convinced that city staff needs this building.

Sure, it would certainly be more convenient to have a place to house public works vehicles and equipment. The parking lot at City Hall does get quite crowded, and those public works vehicles stick out like a sore thumb.

Could this new building house the Newcastle City Hall of the future, though? Could it really be the site of a Newcastle museum, as some council members suggest? If the answers are yes, then sure, maybe there is value in it, but again, we’re not convinced.

It appears that this agreement is all but finalized, though. Residents will have a final chance to make their voices heard at the CCUD’s Feb. 11 public hearing on the issue.

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