To sell or not to sell Bloomington’s police station building: Board tees up vote for city council
Cued up next Wednesday for Bloomington city councilmembers—as the final agenda item for the final scheduled meeting of their four-year terms—is the sale of the city’s police station, which stands on 3rd Street, just north of The Waldron, Hill and Buskirk Park.
That’s the outcome of Friday’s board of public works public hearing, to review three purchase offers.
The board did not recommend that the mayor and city council sell the property to any of the three potential buyers. The board also did not recommend against selling the property.
Instead, the three-member board, all mayoral appointees, voted 2–0 to give no recommendation. That non-recommendation will now go to the city council on Wednesday (Dec. 13) for a vote.
Outgoing mayor John Hamilton administration’s first choice of a buyer is GMS-Pavillion Properties, which after some back-and-forth, offered $4.4 million.
The sale of the police station is part of Hamilton’s plan to move police operations to the recently acquired Showers West portion of the city hall building. Hamilton did not seek re-election this year.
Recusing herself from Friday’s vote was a recent addition to the board, Jane Kupersmith, who was announced a little more than a week ago as mayor-elect Kerry Thomson’s pick to head the city’s economic and sustainable development department.
At the meeting, Kupersmith said about her decision to refrain from voting: “With my current appointment from our current mayor on the board of public works and my pending services as a staff member to the mayor-elect, I can’t make a decision that’s unbiased.”
The $4.4 million offer from GMS-Pavilion matched the higher of two appraisals of the property’s fair market value. The other appraisal put the value of the property at $3.2 million.
Presenting the offers to the board on Friday was Tim Ballard, of Griffin Realty, which was tapped by Hamilton to market the property. The firm is headed by Don Griffin, who participated in this year’s Democratic Party’s primary, and before that served as deputy mayor.
Whatever decision is made by the city council on Wednesday, it seems unlikely that a deal could actually be closed before the end of the year, given the due diligence periods.
Here’s a breakdown of the offers as described in the administration’s memo to the council.
1. Purchase offer from Aptitude Development based in Elmwood Park, NJ
a. Purchase Price: $4,850,000
b. Due Diligence Period: 120 days
c. Contingency: Closing will occur 30 days after “final, non-appealable approval for the development of student housing of at least 475 bedrooms.”
d. Holdover: During approval period prior to closing with an option to extend maximum of six (6) months upon written notice.
2. Purchase offer from UP Campus Student Living based in Chicago, IL
a. Purchase Price: $3,200,000 ($100,000 earnest money)
b. Due Diligence Period: 45 days
c. Contingency: Title commitment, satisfactory due diligence
d. Holdover: 1 year at 10% of closing price (including all closing costs) and with 2% annual increase if beyond one year.
3. GMS-Pavillion Properties, LLC (Steve Hoffman) based in Bloomington, IN
a. Purchase Price: $4,400,000 ($40,000 earnest money)
b. Due Diligence Period: 60 days
c. Contingency: Title commitment, satisfactory due diligence
d. Holdover: 2 years at $420,000 per year. Option to terminate with 6 months notice after first year (i.e. minimum lease back of 18 months). Lease may extend beyond two years for 60-day periods at $35,000/month.
One objection to the potential sale of the property is based on a 1923 deed restriction that requires the land to be used as a free public park and to be named after the families that conveyed the property to the city 100 years ago.
The city’s legal department says it was aware of the deed restriction from the start of the planning, has reviewed its legal merits and has concluded that it does not prevent the city from selling the police station building.
Descendants of the families who owned the land have recently objected to the sale of the police station. In a letter hand-delivered in late November, Philip C. Hill threatened to invoke the reversion clause. Nat U. Hill IV did not arrive in time to deliver his remarks at Friday’s public hearing, but afterwards sent a letter to the city council that reads in part:
Since the City has used part of the park for a City Hall that was later converted into the police station, some in the current administration claim it is OK to sell that part of the Park. After all they say, “It’s no longer a Park.” I think it is a bad look for the City to sell property sold with the original intent of being for public use. In Monroe County parlance, “Just because it’s legal, that doesn’t make it right.
Friday’s hearing was not the first occasion when the topic of the police station sale had been in front of the board as a voting matter. The board of public works had authorized the notice of sale for the property at a minimum price of $3.2 million. That approval came in late September.
In connection with that vote, board president Kyla Cox Deckard revealed at Friday’s hearing that the board had apparently not been fully informed about the deed restriction by the city’s legal department, when it authorized the notice of sale.
During Friday’s hearing Cox Deckard put it like this: “It occurred to me that I probably hadn’t requested what I might need to request at that time, which perhaps was a copy of the deed or something like that to be better informed.” She continued, “I think my decision might have been different, if I knew that there was a legal review that was still pending on that item.”
At the meeting when the vote was taken to authorize the notice of sale, the three-member board was short-handed, because Jennifer Lloyd had resigned about a month earlier. The city’s website listing of the date for Kupersmith’s appointment is Sept. 20, 2023, which is under week before the vote was taken. Kupersmith did not attend the Sept. 26 meeting when the board voted on the notice of sale. Even one dissenting vote out of two would have meant a failed motion to authorize the notice of sale.
Responding to Cox Deckard’s statement, the city’s corporation counsel, Beth Cate indicated the board’s only role on Friday was to make a recommendation, and that the board could consider whatever information it wanted, to make that recommendation.
Cate put it like this: “What your role is, is quite limited: It is conducting the public hearing—we brought the notice to you to approve for the sale—but you’re really providing a recommendation at this point.” Cate continued:, “Obviously, you can take any information that you have into account in making that recommendation.”
Cate added, “But in terms of ultimately approving or authorizing the sale that is really something ultimately that the city council does because of the dollar value of the property at issue.”
Attending at least part of Friday’s hearing in front of the board of public works were two city councilmembers—Matt Flaherty and council president Sue Sgambelluri.
After the hearing, responding to a B Square question, Sgambelluri repeated some of the same sentiments that she expressed at a city council work session last Monday.
The renovation of Showers West to make it secure enough to accommodate police operations, and the move from the current station on 3rd Street is a “complex endeavor anyway,” Sgambelluri said, even under ordinary circumstances.
The purchase of the Showers West portion of the brick city hall building, which was built as a furniture factory 110 years ago was authorized by the city council at the start of 2023.
That project is made “infinitely more complex,” Sgambelluri said, by the fact it spans two mayoral administrations and two city councils with significantly different memberships.
The transition in administrations and city councils would by itself lead her to give some consideration to mayor-elect Kerry Thomson’s preference and the incoming council’s preference, Sgambelluri said.
Sgambelluri herself will not be returning to the city council, having lost the District 2 Democratic Party’s primary to Kate Rosenbarger.
Sgambelluri also told The B Square that the legal issues with the deed restriction that the family has brought forward about the potential sale of Third Street are also “a concern.”
For Sgambelluri, the issue surrounding the deed restriction is important to consider “not just in terms of what is legal, but what is right.”
Sgambelluri called Friday’s vote by the board of public works vote “noteworthy” because it meant that the council had received “no guidance” from the board of public works on the question. She added, “I wonder if that, in and of itself, is guidance?”
Just three people spoke at Friday’s public hearing—two representatives from the police union, Jeffrey Rodgers and Paul Post, and former city councilmember David Sabbagh.
Rodgers and Post repeated the concerns that the police rank and file have expressed from the start, a year ago, about the planned move into Showers West. Post picked up on Cox Deckard’s concern that the issue connected with the deed was not daylighted earlier. “This should have been brought forth to everyone that was involved in the project, that there was a potential there for legal action that looms over all this.”
Post talked about some of the uncertainties related to costs, and urged the board not to act quickly, saying, “There’s no reason to rush into it at this point.” If Showers West is going to be the future home of the Bloomington police department, then it’s important to do the fiscal due diligence, Post said.
The proceeds from the sale of the 3rd Street police station building are needed to help fund a broader public safety project, the bulk of which is supposed to be paid for by a bond issuance approved by the city council late last year.
If there is no sale of the police station, and thus no proceeds, then the Hamilton administration has indicated that renovations to Fire Station 3 would need to find a different source of funds.
In his turn at the public mic, Sabbagh noted that he had previously argued “vigorously” against the purchase of the Showers West as a location for the police department—based in part on the fact that vehicular access to and from that side of the building is limited.
Construction bids are due for the Showers West renovation at noon on Monday, Dec. 11. They’re scheduled to be opened at 12:15 p.m.
The city council’s Wednesday meeting starts at 6:30 p.m. on Wednesday, Dec. 13, at city hall.
Bloomington council meeting information links for the police station sale
Res 23-23
Res 23-23 city staff memo
Res 23-23 council staff memo
220 E. 3rd Street Deed Restriction
Purchase offer for police station property from Aptitude
Purchase offer for police station property from UP Campus
Purchase offer for police station property from GMS-Pavillion
