Raleigh City Council formally approves Dix contract

Posted April 24, 2015

Members of the Raleigh City Council meet on Friday, April 24 to approve the formal contract to buy the Dorothea Dix property from the state.
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— Members of the Raleigh City Council voted unanimously Friday morning to approve the $52 million contract to buy the Dorothea Dix property from the state.

Raleigh Mayor Nancy McFarlane and Gov. Pat McCrory in January signed an agreement for the state to sell the 308-acre property to the city. The contract council members approved Friday fleshes out the details and cements that deal.

Dorothea Dix property in fall Timeline: Decisions about Dix property Members of the Council of State, a 10-member body made up of statewide elected officials that includes McCrory, must next sign off of the sale. They are expected to do so at the council's next meeting on May 5.

For the city, the next steps will be to borrow the money and start designing the destination park Raleigh leaders have long coveted for the site. McFarlane said the city would decide over the next two weeks whether to use a bond referendum or borrow via limited obligation bonds without voter approval. Either route will likely require a tax increase.

"This is really the beginning because this is when the real work starts," she said. "We have no idea what’s going to go in there, other than its going to be phenomenal."

McFarlane said she envisions a "multi-year process" for the design to get as much input from as many sources as possible.

"This really is a park that belongs to everybody," she said. "We also want this to be something people come to from all over to experience as part of not only their capital, but part of North Carolina. The potential is very exciting."

The Dix property is the former home of the mental hospital built by the state in the 19th century. The last patients left the hospital in 2012, and the future of the property, which sits perched on the edge of downtown Raleigh, has been a subject of intense debate over the past three years.

Before she left office, former Gov. Bev Perdue, a Democrat, inked a contract to lease the property to the city, a deal that drew the ire of the Republican-controlled General Assembly. Under threat of legislation that would forcibly undo that deal, McFarlane and McCrory agreed to renegotiate.

The contract council members signed off on Friday is the product of those sometimes contentious negotiations. State senators are still leery of the deal, saying that the state is not getting enough money for the property. Although the city wants to turn the property into a park, it has been eyed by developers as a potentially lucrative site for homes and businesses.

Senators are still considering legislation that would undo the latest deal and put the property back up to grabs to the highest bidders, although there's some signs they are backing off that idea.

"What they really wanted to see was a fair and equitable deal for both sides at the end, and that’s what we accomplished," McFarlane said.

According to city officials, the terms of the purchase contract include:

  • The state will lease back from the city approximately 109 acres for its use. Part of the leased property could be used by the state for up to 10 years and other parts for up to 25 years. The state will be responsible for all maintenance and upkeep of the leased property.
  • If the city sells any of the acquired property or leases any of the parcels long term, the state will share equally in the net proceeds from the transaction. The sharing provision will be in place for no longer than 17 years.
  • The city and the state will develop a joint-use agreement to share parking lots and other areas for special events and for periods when the state is not using the property it can lease.
  • The city and the state will share equally, up to a maximum of $1.2 million, the cost of removing contaminated soil from a small area on the Dix site.

McCrory lauded the council's action Friday.

"The Dorothea Dix property sale will allow the creation of a destination park in our state capital, protects the taxpayers and provides much needed funding for mental health services," McCrory said in a statement. "We look forward to taking this agreement before the Council of State in May. I appreciate the hard work of our team as well as Raleigh Mayor Nancy McFarlane, the City Council and the city staff for their efforts in what proved to be a long, but productive process."


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  • Joseph Smith Apr 24, 2015
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    There is ample waste in the budget to pay for this.

  • Quinn Satterthwaite Apr 24, 2015
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    For the city, the next steps will be to borrow the money
    Yep- as usually Raleigh very good at spending money they dont have.

  • Peter Kerstetter Apr 24, 2015
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    This only goes to show that the GOP in the NCGA can't be trusted to keep their word. They just want to punish Raleigh & Wake County for being Democratic.
    If I were trying to do business with the state, I would take this as the NCGA not being good faith partners.