- Published on Wednesday, 04 September 2013 20:01
- Written by Super User
By WILLARD KILLOUGH III
It's a glaring difference. The position of Mayor Bob Lewis on land purchased by the Town in 2009 for a future Aquarium Pier is different today than when he publicly praised the purchase back in 2009.
History: In 2009 the Carolina Beach Town Council voted to finance $4.3 million in debt to purchase a number of parcels in the 200 and 300 blocks of Carolina Beach Avenue North.
At the time the Council included Mayor Joel Macon and Council members Pat Efird, Alan Gilbert, Dan Wilcox and Jerry Johnson. Lewis was seeking a Town Council seat in the upcoming election that year.
The purpose was to support a future education and recreational pier to be built by the State.
The North Carolina Aquariums Division had planned to construct three piers along the coastline. One was built in Nags Head, NC in the Outer Banks. The second pier was planned for Emerald Isle, NC but was not funded. The Carolina Beach project was to be the third pier.
The original pier project called for a 1,000 foot long concrete pier with wooden decking proposed by the NC Aquariums complete with seating kiosks, fish tanks, conference space, kitchen facilities, pier store, decks and balconies to view the ocean, equipment rentals, a 10,000 square foot pier house, ADA accessibility and the potential for outdoor entertainment. The Town would be required to sponsor other improvements including 150+ parking spaces that are adjacent to existing parking lots.
That project never materialized and the Council worked to renegotiate the loans with BB&T as well as generate revenue from two hotels located on the properties to help pay the mortgage. Later on the Council voted to put the properties on the market for sale. They've yet to be sold.
Mayor Lewis differing opinion from 2009 to date was discovered while researching minutes over the last seven years in preparation for the upcoming election season and the inevitable fact checking that goes along with statements made by elected officials. It's a common practice by newspapers to perform those routine research projects.
When reading a recent email response between Mayor Lewis and County Board of Commissioners Chairman Woody White, Lewis spoke negatively about the 2009 land purchases. Yet in 2009, he spoke in favor of the land purchase, the project and future use of the land should the project not become reality. To the point of saying at a 2009 Council meeting, "You have to make a stand in the sand sometime."
Here's the difference: (And the forward details are important).
The New Hanover County Board of Commissioners voted Monday morning August 19th, to approve of a $500,000 grant to the Town of Carolina Beach for a Boardwalk improvement project. The project would widen the beach cross over walkways to 10 feet, widen the boardwalk itself to 16, feet, extend the boardwalk
almost 800 feet to the north, rebuild the beach stage and include other recreational amenities.
Prior to the August 19th, County Commissioners meeting, Board Chairman Woody White sent an email to Mayor Bob Lewis posing some questions about the project and grant request.
One of those questions was:
"What is the Town's obligations on real estate that it owns, that may could provide cash for this project? Are there any parcels marked for divestiture from your property roles that would either create cash, or lower operational expenses?"
Bob responded, "The Town (under prior administrations) bought several parcels of land in the hopes of a NC Aquarium Pier being built here. The Town had no firm written commitment for grants or in fact any MOA from the state guaranteeing performance. That administration borrowed $4,300,000 (110% of the purchase price) which has left the Town with unneeded debt and an asset we can't use!. This Council recognizing that no pier was coming has placed the assets on the market for sale. Regrettably it appears the fair market value of these properties could be half of what we owe, $2,000,000 +/-. Council did recently sell 3 vacant residential lots it owned for $120,000."
Rewind back to 2009 and the Mayor had a different view of the Pier property purchase that led to "unneeded debt and an asset we can't use."
In October of 2009 Lewis was running for election to a seat on the Town Council. At the October 13, 2009 Town Council meeting, the Council voted two make two land purchases. One for $475,000 for a lot on Canal Drive and $3.6 million for numerous lots on Carolina Beach Avenue North. Then Town Manager Tim Owens said the debt service would be $4.3 million and without obtaining grants would likely result in a 1.5% property tax increase to fund the debt over a number of years.
There was discussion about a "Plan B" during that October 13, 2009 Council meeting prior to Lewis speaking in favor of the land purchases and options if the pier project did not happen. At the time the Council was told by former Town Manager Tim Owens, "If the [state] pier funding was not there you would continue to operate the hotels obviously, but at some point you would probably sell parts of it off or you would have one heck of a beach access site with plenty of amenities. It's 300 feet of oceanfront land. It's a great opportunity to have one heck of a site. Obviously it comes at a premium cost."
According to the minutes of that 2009 meeting as obtained from the Town's website, "Bob Lewis, 670 St. Joseph Street, said that one of the things that was impressive was that Tim brought up the fact that you all took a look at was the commitment you made to the Wilmington Beach area and you brought that up to the discussion so you already planned in the infrastructure we're going to support for the Wilmington Beach people and he thinks that has been going on for years and years and he totally supports that. But on top of that project he thinks they also have been talking about what else can we do for the community, how can we drive this progress for our community forward and he thinks the pier is kind of a cornerstone to that. He thinks that's great. The chance to find this size of a lot is probably not going to come before this Council again probably within the next 4 to 6 years at this price. There is another piece of property right down the street, smaller in acreage, was offered to all of you for about $6.6 million, if he recalls just not too long ago.
So you take a look at comparison - $6.6 million, smaller acreage vs., almost right next door, over 2 acres for a little over $4 million. That's a real big difference in just a matter of a short period of time."
The minutes state, "Mr. Lewis said you are almost getting twice the value for the same investment" and, "Mr. Lewis said you have to make a stand in the sand sometime. It might be a great opportunity. There are risks, the $360,000, but he thinks if you talk to the citizens, over a period of time you might be able to return that money even if you don't put a pier in there. There might be other ways that the Town can sell that property, reuse it in some other formats, find another venue that might fit in there that actually drives some type of revenue for the town itself. There are all kinds of options. To say it's just going to be a park if we don't get a pier there, he doesn't think that is really being fair. He thinks there are a lot of different venues, a lot of creative ideas in the this community. If we do buy the land and there is no pier, he thinks there are other things you can do with that land that will benefit the community as well as maybe attract people down here."
On August 15th, it was published on the Mayor's campaign Facebook page that he and councilman Steve Shuttleworth "negotiated a significant loan modification that reduced the interest rate to 1.75% and greatly reduced the annual costs associated with the properties," and, "This individual initiative now saves our taxpayers over $70,000 annually in financing costs for the motels sitting on these parcels. Our Mayor Bob Lewis was not part of the decision to buy this land but seeing the drain of over $250,000 in annual loses on the properties to the taxpayers of Carolina Beach he took action."
When asked on Monday September 2, 2013, if Mayor Lewis thought the previous administration made a bad decision when they purchased the properties for the Aquarium Pier, Lewis responded, "I think the idea was a
good one but when you see that they did not secure any signed agreement with the State on the entire project it does not look like a good decision. The idea was strictly focused on tourism and in the end when you look at the business case the town would of taken all that property off the tax rolls and from what I
was witness too in the early months of taking office the town would give up all the parking revenue around the facility. The town would of had to pay for the extension of the boardwalk. All the grants we were seeking were 100% matches so I think it totaled over $2 Million in town money. We would of experienced an increase in ROT revenues which can only be spent to drive more heads in beds. We might of received some increase in sales tax revenues but that is not a guarantee under the formula in which we get money back. The reduction in ad valorim would of reduced our % share of sales tax revenues."
Lewis explained, "I liked the idea when I heard about it initially but I expected the town would of received some sort of signed document from the state. When visiting with our representatives we got a lot of help but concern that we did not have even a memorandum of understanding. It is easy today to sit back and see that the land was not a good buy. The fact that no one else at auction was willing to pay the $3.6Million price for the land nor the $450,000 for the parking lots it does not seem have been a good decision."
He explained, "My approach is totally different when we do not have the capital to invest in a large project like this or when it is not in the budget I think the best plan is to source and secure funding first then work on moving forward with the project. To use the reverse strategy seems to suggest extreme risk."
During the October 13, 2009 meeting there was extensive discussion on obtaining grants after purchasing the property.
During a meeting in 2012 to decide on selling the properties, Lewis explained, "I can't imagine us building a two and a half or three million dollar park. There's not enough value to the residents for that type of investment. We have other better things we can invest our money in number one. We've been saddled with this thing. Somebody else bought the property and now the Council here has been saddled with what do we do with it? We've stopped the bleeding which is the best thing... right now putting it all on the market makes sense to me and see what happens."