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City to buy warehouse for police evidence

Sat., June 5, 2010

Voters nixed tax increase for building

Fifteen months after voters rejected a tax to pay for a new police evidence building, city officials say they can open an improved facility without new taxes.

The city announced this week plans to buy a warehouse in East Central Spokane and convert it to store police evidence by borrowing from the city’s main reserve and investment fund.

Last year, voters turned down an $18.5 million bond for a new $11.5 million police evidence building, among other projects. Under the city’s new proposal, Spokane will pay $2.8 million for the Great Floors warehouse at 4010 E. Alki Ave. and $600,000 to upgrade the space.

At the same time, the city plans to purchase the Gardner Building, 1427 W. Gardner, for $1.8 million to house the Police Department’s domestic violence and special investigation units. The city has leased the building since 2008, but hasn’t been using it. Purchase of the space also was included in last year’s failed property tax proposal.

Attempts made to reach Mayor Mary Verner were unsuccessful on Friday. In a news release she called the proposal a “no-cost solution to a potentially huge liability.”

“This is the kind of thinking that our citizens are demanding, especially during this economic downturn,” she said.

But former City Councilman Al French criticized the purchase of the Gardner Building, saying it “makes no sense” to buy office space at a time of layoffs.

“When they’re trying to downsize government, that’s a contradiction,” said French, who left the council after two terms at the end of last year.

Under the new plan, which needs City Council approval, the city would repay its own investment fund with interest over 20 years. The city places most of its reserves and other money in an investment pool. The fund includes money saved for upcoming wastewater and other projects and totals about $300 million.

Chief Financial Officer Gavin Cooley said the city can make annual payments on both buildings using the savings from moving the two police investigation units out of leased space at Monroe Court, an office building near the Spokane County Courthouse.

“Knowing that the taxpayers were not going to support a tax increase, we asked, ‘How else can we do this?’ ” Cooley said.

Spokane police have argued for several years that its evidence building, owned by Spokane County, is full and in need of significant upgrades, including a sprinkler system. The city oversees evidence storage for it and the Spokane County Sheriff’s Office.

The Great Floors purchase allows the city to vacate the county-owned building near the courthouse as well as a downtown warehouse on State Street where vehicle evidence is stored.

Councilman Bob Apple, who opposed last year’s tax proposal, said he’s glad administrators abandoned the more expensive evidence building. He added that it’s better for the city to move from rented space.

“I think we’re better off with our own facilities,” Apple said. “It pencils out for the long term.”

Although the total cost of the project is much less than a new building, the city is paying more than the assessed values for both buildings.

The Great Floors warehouse, which was built in 1978, is valued by the county assessor’s office at $1.5 million. The Gardner Building is valued by the county at $1.3 million.

“In my experience that’s really not all that unusual to have a difference between assessed value and market value – particularly on commercial property,” said Rick Romero, the city’s internal auditor.

The city began leasing the Gardner Building for its potential new municipal court in late 2008, but instead kept the court at the Public Safety Building; the Gardner Building remained empty.

Dr. Marcus DeWood, who owns Monroe Court, has been lobbying the City Council to stay at his building. He questions why Verner allowed the city to lease Gardner before knowing if the city would use it.

The city has paid more than $200,000 a year to lease Gardner and for other expenses of the structure.

“You never lease a building unless you have a use for it,” DeWood said. “Now she has a building and she has to do something with it.”

At his final City Council meeting last year, French was sharply critical of the administration’s decision to keep the Gardner Building. The lease should have been allowed to expire when the city decided not to put courts in the building, he said.

French, who has received contributions to his current election campaign for Spokane County commissioner from DeWood and DeWood’s wife, said leasing space would give the city more flexibility – especially in tough times.

“I don’t care if it’s Marcus’ building or anyone else’s building,” French said. “I’m talking about a business plan.”

DeWood says he offered to freeze the city’s rent at Monroe Court for five years and to pay off the remaining lease payments the city had on the Gardner Building. He also offered the city a deal to lease and fix the former Hostess Building, which he also owns, for police evidence.

Councilwoman Amber Waldref said the administration’s case is strong that moving from Monroe Court will save enough to allow the city to purchase both buildings.

“We have instant savings every year,” she said. “We owe it to our citizens to make sure our evidence in cases is protected and preserved.”

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