Taking care of business

The fallout from Buncombe County’s controversial plans to site a satellite jail on the edge of downtown continued to ripple through the community last week.

The Asheville City Council, which unsuccessfully pleaded with the county commissioners to delay their Jan. 16 vote, responded on Jan. 23 with action of their own. (See “Just the facts,” on page 10.)

Three days later, on Friday, Jan. 26 — at an afternoon meeting arranged by the county to discuss its plans and possible alternatives with members of the community — Assistant County Manager Jon Creighton announced that the county had already closed on the deal a few hours earlier. The closing took place that morning at 11:30, despite the fact that the county had until Wednesday, Jan. 31, to buy the 1.7 acres at 123 S. Lexington Ave.

The Board of Commissioners unanimously agreed on Jan. 16 to authorize buying the property for $1.45 million from Union Transfer & Storage Co. (See “Shock waves” in the Jan. 24 Xpress.)

The proposal has generated a storm of protest, mainly from downtown developers who point out that development of the area between the central business district and the hospitals is slowly gaining momentum. They fear that the satellite jail (which would house minimum-security inmates) would chill that trend, especially the area’s budding residential development.

County officials, however, stress the need for more jail space.

“The need is there,” asserted Major Bill Stafford of the Buncombe County Sheriff’s Department.

Rushing ahead

At the Jan. 16 meeting, county staffers urged the commissioners to make a decision quickly. The board wasn’t planning to hold a regular meeting between then and the Jan. 31 closing date (although a budget retreat was planned for Jan. 30).

Staff also wanted the county to apply for first-come, first-served federal grant funds to help with converting an existing building into a jail. At the meeting, the commissioners gave staffers the OK to buy the property and seek a $1.65 million grant from the U.S. Marshals Service.

But a week later, it looked doubtful that the county would even apply for that grant.

County officials were concerned about the impact such a grant would have on the project’s tax-exempt financing, Creighton revealed.

County Finance Director Nancy Brooks noted that to maintain a project’s tax-exempt financing, IRS rules dictate that no more than 10 percent of the completed project can be put to “private use.”

“The federal government is considered private use,” she said.

Officials are concerned that the grant would have strings attached that would require the county to set aside a certain number of beds for federal prisoners. If that number were more than 10 percent of the total number of beds, it could endanger the project’s tax-exempt financing. The county’s bond attorneys are evaluating the terms of the grant, Brooks said.

Such federal requirements are nothing new for the local criminal-justice system. Part of the county’s financial arrangements for building the Buncombe County Detention Center (the current jail) hinged on agreeing to house federal prisoners, Stafford said. The county now keeps 20 to 30 federal prisoners in the facility at any given time, he added.

The county agreed to set aside a minimum of 27 beds for federal prisoners, according to a 1997 update of the contract between the county and the Marshals Service.

Building and outfitting the county jail cost $21 million, said County Planner Cynthia Barcklow. The Marshals Service chipped in $1 million for the project, according to the agreement.

The arrangement to house federal prisoners also provides ongoing revenue for the county, which charges $55 a day for bed space, noted Brooks. In the ’98-’99 fiscal year, the county collected $949,747 by renting beds to the Marshals Service, according to the county’s financial records. That figure rose to $1.2 million in the ’99-’00 fiscal year. So far, the county has collected $650,000 in the current fiscal year, the figures show.

But the county’s plans for the jail do not hinge on getting the grant, according to County Planner Michael Bradley, a few days before the deal closed. “The grant doesn’t make or break the decision,” he said.

Skyrocketing property values

Interestingly, the appraised value of the South Lexington property is more than triple its assessed tax value.

The Buncombe County Tax Department values the property at $510,100, noted state-certified general appraiser Elbert L. Taylor in his Dec. 4 appraisal of the property. But Taylor judged the property to be worth $1.6 million.

Taylor based his appraisal on a number of factors, including the sale of property down the hill from Union Transfer & Storage, he wrote in his report. In May, Entero Med bought 1.78 acres on Southside Avenue (where the old R.C. Cola building sits) from Royal Crown Bottling Co. of Asheville and Lamb II Properties for $1.3 million, he pointed out.

Tax Department Director C. Jerome Jones said he’s not surprised by the discrepancy. The Tax Department’s most recent countywide property revaluation took effect on Jan. 1, 1998, based on 1997 research, he said. Jones thinks it less likely that the county undervalued the property than that values have gone up drastically in that part of town.

“That area has changed dramatically in that three-year period,” offered Jones. “Sales in that area simply indicated that the value we had on it then was the proper value.”

Still going strong

Wayne Campbell, who owns both the property and Union Storage & Transfer Co., noted that although the company has outgrown its current location, he has no plans to go out of business. Campbell said he’ll look for a location that would better suit his business’s needs. Union Storage is the local agent for United Van Lines.

“We’re here to stay,” Campbell emphasized.

The purchase contract allows his company to occupy the site rent-free through March 31, 2001. From then until Oct. 31 when Campbell must vacate the premises for good, he can rent the building for $5,000 a month, according to the terms of the contract.