Raleigh, N.C. — A Senate committee advanced legislation Thursday morning that would void Raleigh's lease of the Dorothea Dix site.
An amended version of Senate Bill 334 passed the Senate Appropriations Committee on a voice vote and is expected to go to the full Senate next week.
Under the terms of a 99-year lease signed in December by Raleigh Mayor Nancy McFarlane and former Gov. Beverly Perdue, the city would pay $500,000 a year – plus annual escalators – for the 325-acre site of a former mental hospital, allowing officials to convert into it into a major urban park.
Republican lawmakers criticized the deal, which they said didn't provide the state with a fair return. They also said it would end up costing taxpayers money because state Department of Health and Human Services offices at the site would have to be moved.
"This was a lame-duck deal done by a lame-duck governor," said Sen. Tommy Tucker, R-Union, one of the sponsors of the bill.
The bill, and companion legislation in the House, call for the lease to be renegotiated at a fair-market price, with the proceeds designated for mental health programs. Also, DHHS would be allowed to maintain its offices on part of the site.
An amendment offered by Sen. Neal Hunt, R-Wake, calls for assessing the Dix property as parkland or open space, rather than at commercial rates, if the lease is renegotiated. A second amendment by bill co-sponsor Sen. Louis Pate, R-Wayne, adjusts the number of DHHS employees who would remain at the site.
Pate and co-sponsor Sen. Ralph Hise, R-Mitchell, said the Dix land was given to the state in the mid-1800s for the benefit of the mentally ill, and the state needs to stick to that goal.
"We won't go into a lease that violates state law," Hise said. "The obligation for the state is to provide mental health benefits."
Sen. Dan Blue, D-Wake, said state officials decided several years ago when they built Central Regional Hospital in Butner to abandon the Dix site as far as mental health treatment was concerned.
Blue also noted that the state transferred part of the original Dix site to North Carolina State University almost 30 years ago for what has become its Centennial Campus. The success of that venture points to what Raleigh could do with the rest of the Dix land as it's developed into a "destination park," he said.
Jim Goodmon, a member of the Dix Visionaries group of park boosters, warned lawmakers that tearing up a valid contract with Raleigh won't sit well with others looking to deal with the state.
"It's a matter of honor – we don't break leases," said Goodmon, the president and chief executive of Capitol Broadcasting Co., the parent of WRAL.
"How does Raleigh know that you're not going to do this (again) three years from now?" he asked. "Nobody will trust doing business with the state."
Senate Minority Leader Martin Nesbitt said the bill also doesn't set a good precedent for handling the business done by previous administrations.
"This is insane," said Nesbitt, D-Buncombe. "The people of this state deserve a little continuity of government and to be able to rely on government."
Tucker and Hise noted that the lease allows the state to condemn the property for public use, and they are exercising that right.
The Raleigh City Council and city attorneys met in a closed-door session Tuesday to discuss their legal options for the challenge to the Dix lease.
Republican Wake County Commissioner Joe Bryan has suggested that the state get a new appraisal on the Dix site and leave it up to Raleigh voters on whether they would support issuing bonds to pay the state what it's worth.