The Casper City Council failed on a tie vote to approve a resolution to sell the former Plains Furniture properties to a local development group.

The issue for four council members boiled down to respect for the taxpayers and a concern the city would be taking a $2 million loss after the purchase of the properties for $3 million in 2015.

 

Council members Shawn Johnson, Ken Bates, Khyrstyn Lutz and Steve Cathey voted no.

Mayor Charlie Powell and council members Ray Pacheco, Bob Hopkins and Mike Huber voted yes.

Steve Freel abstained.

The prospective buyer and the only business that submitted a bid, FLAG Development, LLC, had offered $500,000.

The 15 lots are on South Ash Street and West Midwest Avenue and South David Street.

"It is a condition of the proposed Purchase Agreement that these properties also will be put back into use which includes significant new construction and specific purposes for economic development," according to the recommendation to sell the properties in the council agenda.

In 2015, the city council on a 6-3 vote bought these and other properties for $3 million.

Powell recounted some of the history behind the purchase.

The owner of the Plains Furniture properties then told the council that it had three weeks to decide whether to buy them, and set a price of $3 million, Powell said.

Money was tight then, the David Street Station was underway and there were issues about  acquiring that land. Likewise, the state was looking possibly building its office building on the Goodstein parking lot. The state decided to locate its building west of that, Powell said.

The city council was concerned that if someone else bought the properties, the city would have no control over what happened there, he said. The public probably would not have been impressed if another owner turned the area in a significant area of downtown into storage units, Powell said.

The city did have some money set aside for capital purchases, he said.

Powell among those council members who voted to buy the building, and took a lot of criticism for it, especially since there was no plan to develop it, he said.

After the purchase, the city learned that the former city garage was located in the Plains Furniture building, and also learned it was the former Nolan Chevrolet building.

That history could have been lost if the building had been torn down, Powell said.

Brandon Daigle, an architect and partner with FLAG Development, showed slides of the history of the more than 30,000-square-foot building, and its interior features.

FLAG would have demolished a century-old livery on South Ash Street and re-exposed the original building, Daigle said.

FLAG also intended to sell some of the properties, and build a three-story building with a total of 18 residential units, he said.

Eric Ruckle urged the council to approve the sale, reminding them there was a lot of opposition to the David Street Station and now some of those opponents can be seen enjoying themselves there.

"It sends a message about where we're going as a community," Ruckle said.

However, Casper resident Dennis Steensland opposed the resolution, saying it would have been a $2 million loss for the taxpayers.

David Kelly bought one of the original properties on the site for his business Ashby Construction, criticized the $500,000 sale price, which was far below the appraised value, and the previous offer of $1 million. Kelly also criticized the city waiving a $15,000 waste collection fee for FLAG.

Hopkins said the second appraisal was lower than the first, and that the market ultimately determines a price.

The state was impressed what the city was doing with the David Street Station, it decided to build its $40 million office building, Hopkins said.

The city sat on the former Wyoming National Bank building for years and lost money on that, Hopkins said. Developer Steve Grimshaw eventually bought it and rehabilitation into low-income housing, he added.

Bates said he likes FLAG's proposal, but opposes the resolution because the taxpayers are taking a loss.

"I think the amount of money we're about to lose is a disservice to the taxpayers," Bates said.

Johnson was one of the three council members who voted against the $3 million purchase in 2015, and said that the scenario he feared about the city taking a loss.

Huber wondered how long the city will hold on to the properties if it doesn't approve the resolution.

He agreed the city will be writing off a lot of money, but he asked if it worth more to move forward, or would we be better off holding off hoping for a better deal, Huber said.

Lutz said value is determined by market, not what people hope something is worth.

Lutz was also concerned about perceived conflicts of interest because Daigle was the president of the Downtown Development Authority, and FLAG partner Kevin Hawley is the current president of the DDA.

Casper City Attorney John Henley said there was not a conflict of interest if FLAG did not have any inside information.

Cathey said he, too, voted against the $3 million purchase and would do it again because he  objected to selling the properties for a third to half of its appraised value.

City of Casper

Pacheco also cast a "no" vote to buy the properties for $3 million, but said he would favor the sale because he didn't think the city will get a better offer.

Powell favored the resolution in part because the city is preserving something historical and the project will be worthwhile in the long run.

"I think it's the right thing to do and will be a very impressive project," Powell said.