State, Raleigh agree on lease of Dix campus for major park

Posted December 4, 2012
Updated December 5, 2012

— State and Raleigh officials on Tuesday approved a plan to lease the 325-acre Dorothea Dix Hospital campus to the city, which plans to convert the site into a "destination park."

The Council of State, the panel of 10 statewide elected officials, voted along party lines for the lease, with Republican Agriculture Commissioner Steve Troxler and Republican Labor Commissioner Cherie Berry opposing the plan. Democratic State Auditor Beth Wood abstained from the vote, saying the issue could come before her office for an audit later.

"This is been a really good public-private partnership where we've all worked hard to make today happen," Gov. Beverly Perdue said. "This didn't just happen. It was well planned and really well orchestrated, and I'm delighted for the people of North Carolina."

On Tuesday afternoon, the Raleigh City Council voted 7-1 to accept the lease agreement. 

"Everybody on the council's been very supportive, and we worked a long time for this," Mayor Nancy McFarlane said. "They really do understand what a great thing it'll be for the city and the state."

Councilman John Odom was the lone vote against the plan. He said he supports the park, but wanted more details about the contract.

"I was set to go ahead and vote for it," he said. "But once again, we don't have a clue of what we're buying."

City Manager Russell Allen said officials expect to have the paperwork on the deal finished by the end of the month.

The Dix campus has been owned by the state for more than 150 years. It was once home to a mental hospital, but the campus is now mainly occupied by Department of Health and Human Services offices.

The lease calls for Raleigh to pay $500,000 per year to the state for up to 99 years. As a condition of the lease, the city will lease back to the state the office space it currently occupies until a plan to consolidate those offices elsewhere can be worked out.

The price for the lease would rise by 1.5 percent every year, but the city would get a discount for any property that the state is still using.

Republican legislative leaders and conservative groups called on the Council of State to put off the issue until Republican Gov.-elect Pat McCrory and lawmakers could review the lease. They claimed the deal was bad for state taxpayers, especially those outside the Triangle, and accused Perdue of rushing the vote to burnish her political legacy.

Senate President Pro Tem Phil Berger said the Senate would look at legal options to terminate the lease.

"There's is been a lot of talk for a number of years about what to do with the Dix property, but this particular proposal just came out of the blue over the last week, week and a half," said Berger, R-Rockingham. "If there are viable options, then I'm interested in proceeding with attempts to undo this."

McFarlane dismissed the notion that only Raleigh residents will benefit from a Dix park.

"What's good for Raleigh, what's good for Charlotte, what's good for all the cities is really good for the state of North Carolina," she said. "The more business and tax dollars we can generate, everybody benefits."

Berry was the most vocal opponent of the lease deal during the brief Council of State meeting, calling it a "raw deal" for taxpayers that was rushed through the council for a quick vote.

Dorothea Dix Dix campus could bring people from 'far and wide'

"I believe this lease is way below fair-market value," she said, adding that she feels the deal restricts the state's ability to renegotiate the leases of nonprofits already occupying space on the Dix campus.

The Dix property has been appraised as high as $86 million, but a study by the General Assembly’s nonpartisan Fiscal Division and Program Evaluation Division values the lease deal at $22.6 million.

Raleigh officials worked for months on a deal to buy the Dix land from the state, but the two sides couldn't reach an agreement on the value of the property.

"We just knew it was going to be a long process, and tried to work through as many different scenarios as we could until we found one that work for everybody," McFarlane said.

Democratic Lt. Gov. Water Dalton and Democratic Attorney General Roy Cooper noted the state has leased land elsewhere to cities and counties for $1 per year to encourage development.

"It doesn't have to be at fair-market value. It's a fair return," Dalton said. "Raleigh has been the best city in the nation to live, work (and) relocate. This will add to the values all around Raleigh ... and any appreciation in the property comes back to the state."

Perdue said there was no rush to approve the lease plan, noting that she's worked for more than three years to find a way to keep Dix as a park.

"The city will grow to more than 1 million people in less than two decades. This is a good conservation investment as well as an economic development investment," she said.

John Odom Raleigh leaders react to Dix agreement

Cooper called it "short-sighted" for people to view the deal strictly in monetary terms, saying it's an investment in the region's future that will generate private development and tourism.

Private boosters of the park idea on Monday pledged $3 million to help Raleigh officials draft a master plan for the site.

"Great cities in America have great parks," said Greg Poole Jr., the leader of the Dix Visionaries group.

Democratic Secretary of State Elaine Marshall said the lease plan wasn't perfect but noted "the search for perfection sometimes can paralyze people." She said plans for the future of the Dix campus have been debated for years.

"This is a plan that will stand the test of time, and this is a plan that will preserve a legacy – the people's legacy of North Carolina," Marshall said.

Perdue said she would like the revenue generated from the lease to go to mental health services, but Cooper said the money "would not even begin to dent" the problems North Carolina faces in mental health treatment.

"It is critical that this state address our issues with the mentally ill," he said. "It's an issue we need to deal with, but I think we should move forward with this (lease)."

Lawmakers will have to decide how to spend the money from the lease, and the uncertainty over mental health funding has prompted mental health advocates to oppose the state's deal with Raleigh.


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  • delta29alpha Dec 6, 2012

    Also Oakcity, these places you mentioned bring in tourist and tax dollars that benefit everyone in the state. The Raleigh park will not bring in tourist or produce revenue. it will primarily be used by locals for free. Nothing wrong with that but you are trying to compare two different types of venues.

  • delta29alpha Dec 6, 2012

    Oakcity. you can't compare the two types of parks. Fort Fisher is a historic site that people come from all over to see additionally it has an ocean. The outer banks has the ocean, people come to see it because they don't have an ocean where they live they come to surf fish and sail and dive and go surfing because the coast is the only place where that can be done. Chimney rock is in the mountains, so people who don't have mountains go there to see it. The Raleigh park is a different kind of park, it's a recreational park. I guess it will have running paths and trails to ride the bicycle and open spaces for people to exercises. It will benefit people who live nearby in the city who may not have green spaces in their city neighborhoods. It will not attract people from other places because most other places have their own recreational parks that offer the same things. In other words it will not have anything unique enough for people from other places to travel to see. Not that a recreati

  • mmtlash Dec 5, 2012

    love your post oakcity :-)

  • oakcity Dec 5, 2012

    "How does someone like me, who lives an hour away from Raleigh benefit from this? The answer is I don't and neither does anyone else who lives outside of Raleigh"

    you know what, your right, us raleigh folks are sick of it too. i propose that we bull doze and develop fort fisher, how about the rest of the outer banks? those horses need to be shot anyways they're a waste of our money. i mean we don't see any type of direct payment because that land has not been developed.

    chimney rock? chimney not!!!! lets tear it down and put up some condos. mt. mitchell? i'm thinking the folks of western nc owe us wake county folks some cash. we paid for it and it none of that stuff is benefitting any of us directly.

  • mattcli Dec 5, 2012

    How does someone like me, who lives an hour away from Raleigh benefit from this? The answer is I don't and neither does anyone else who lives outside of Raleigh (and probably most people who do live there as well). I'm not going to drive an hour to your park no matter what you put there. There's no guarantee this will make money for the state coffers. It looks like a huge loss to me.

  • alwayslovingu30 Dec 5, 2012

    Get ready for taxes to go up again perdue could pay it very easley lol

  • Danny22 Dec 5, 2012

    The gov and her cronies should not have the power to enslave the NC taxpayer into a decades long tax liability.

  • beachboater Dec 5, 2012

    Yep, it's a good plan. Voted on and approved along party lines. Sounds like a great plan.

    Raleigh will pay the state $500,000 and the state will probably pay Raleigh $510,000 to lease the buildings back from Raleigh. After all, buildings are worth more than raw land. I don't like a decision being made by 10 people on something this big.

  • NYtoNC81 Dec 5, 2012

    Reading comments about a park and I'm seeing multiple comments about God and the rapture.

    What on earth is going on? Are we back in the Dark Ages?

  • Wiser_now Dec 5, 2012

    This is a win-win-lose situation. Raleigh wins because it gets to try out this "great thing for the city and the state". The State wins because they can make some money and when Raleigh says it too much responsibilty,I'm assuming, the land reverts back to the State. The only losers are those who will have to pay taxes to Raleigh to cover the rent and maintenance.