Elected officials unanimously denied a request for ballistic resistant glass and walls as part of upgrades to a building soon to be occupied by the Margate Community Redevelopment Agency (CRA). Conversation over the item led officials to putting the building up for sale once the Agency moves in.
Referring to the building as a “money pit” and “sinkhole” CRA Vice Chair, Commissioner Anthony Caggiano, said he couldn’t justify putting another penny into it.
“There’s no reason to keep dumping good money after bad. We should sell it,” he said.
The request for security enhancements turned into a broader discussion by elected officials over how much more money the CRA might need to invest in building upgrades, and why the inspection process failed.
The building is the former Alzheimer’s Family Center at 6280 Atlantic Boulevard and was part of a deal the City made in 2015 to recoup roughly $500,000 in taxpayer dollars inappropriately used to fund the Center.
CRA staff told elected officials that serious leaks in the roof have emerged recently and that air conditioning units originally thought salvageable would likely need replacing.
“My problem is that the inspections were not done prior to purchasing the building. None of this was disclosed when we bought the building, had we known, perhaps we wouldn’t have bought it,” Commissioner Joanne Simone, told CRA staff. “Who do we hold accountable? Do we have recourse to give the inspector who didn’t see these things?”
Simone’s sentiments echoed those of Margate resident, John Hall, who two years earlier warned commissioners of potential repair costs to the building if the City/CRA bought the 35-year-old structure.
Hall too at the time didn’t think it was appropriate for the CRA to purchase the property as a means of settling a debt for the City. The debt was incurred by the City of Margate - not the CRA, so proceeds gained from the sale or rental of the property should reimburse city coffers from where tax dollars originally came, not solely the redevelopment district, an area encompassing 23% of the City and the majority of the city’s business district. Tax dollars collected by the CRA can only be re-invested back into designated CRA areas. This, in turn, diminishes the pool of tax dollars the City of Margate has to maintain infrastructure outside the CRA District. (Click for CRA District Map)
Further, the City would pay the CRA $30,000 a year for the Department of Economic Development to occupy part of the former Alzheimer’s building.
“To involve them is just insult after injury,” Hall said.
Legal advice on the matter came from then City Attorney, Eugene Steinfeld, who proclaimed at the time that no decision would be made to purchase the property until a title search and final inspection of the premises was conducted. If the building needed significant work, the City may have to revisit the terms of the settlement, he said.
But the settlement wasn’t revisited and little over a year later elected officials learned the building needs a new roof and AC that together can cost upwards of $70,000.
“If this indeed is just another of expenditures that are going to come before us [regarding the building] maybe it is time to cut our losses,” said Vice Mayor, Arlene Schwartz, at the Wednesday CRA meeting. “I don’t think putting bulletproof glass is the answer to that building right now.”
Mayor, Tommy Ruzzano, favored selling the building when the CRA first acquired it 2015 and hasn’t changed his position since. Selling the property would generate TIF dollars, he said, otherwise nothing comes from it being government-owned. To that end, the city’s investment in the property would be upwards of $100,000 “plus paint plus furniture” he said, if commissioners approved security upgrades Wednesday.
“It just seems to be the best thing is to sell it,” The Mayor and Chair of the Agency said.
“Money is being spent and no money is coming in,” said Caggiano, adding that he was surprised that no one from the city’s building department was called out to look at the building before the CRA bought it - and if they did why they failed to report accurate findings. One city official commented that the building department was overwhelmed at the time.
“Our guys were too busy to inspect it, which befuddles me,” the Vice Chair of the Agency said.
While the agenda item at hand solely addressed security upgrades to the building, Caggiano made a motion to put the building up for sale instead of moving the CRA and Department of Economic Development into it.
Following several amendments to motions after that, elected officials decided that the Economic Development Department would remain in City Hall for the time and the CRA would move into the Atlantic Boulevard building. This, and a “For Sale” sign would go out front.
Simone said she too didn’t favor putting more money into the building, but thought it was too late, as the CRA had plans to begin moving the next day - before the leaking roof could be repaired or air conditioners replaced.
Questions arose as to where the CRA would go if elected officials denied the move.
“My direction is you can go to work tomorrow where you went to work today [City Hall],” Caggiano suggested.
As an alternative, Caggiano suggested CRA staff move into one of its own storefronts downtown, such as a space in the Margate Shopping Center or Chevy Chase Plaza.
The suggestion met with resistance from Colonna, who spoke to downtown properties as overly in disrepair and would require significant investment to convert to office space. In contrast, one private sector tenant recently invested $60,000 to turn a storefront in the Margate Shopping Center (Ace Hardware Plaza) into a modern, attractive professional office.
Colonna’s response took Caggiano by surprise, he told MargateNews.net. He was disappointed to hear the Executive Director speak poorly of properties her Agency currently leases, as well as to dismiss the future rental of spaces in plazas that are nearly 90% occupied and attracting private investment.
Colonna referred to plazas where entrepreneurs are presently investing livelihoods as ones that eventually will be “demolished.”
Caggiano said too that he wasn’t happy to learn that while Colonna suggested that other city departments were in line to occupy City Hall office space, Interim City Manager, Sam May, told elected officials that no plans were in place to occupy offices proposed to be vacated by Economic Development Department. May did not speak to second floor offices currently occupied by the CRA nor were any questions raised regarding the imminent need for City Hall office space by various departments.
The value of the former Alzheimer’s Family Center has increased roughly $50,000 since purchased by the City and CRA in 2015. Land and building together are tax assessed at a fair market value of $624,830.
Commissioner, Lesa Peerman, was the only one of five elected officials that fully supported continued investment in the building. She didn’t, however, see the need for ballistic glass and walls.
In terms of selling the property, Peerman said it was the first time she heard fellow commissioners say they wanted to sell it. This was contested by Ruzzano who spoke to selling the building when purchased in 2015, and by Caggiano who prior to his election to Margate office in November fought to keep Alzheimer settlement assetsin the hands of the City - not the CRA. Joanne Simone has expressed in the past that elected officials have had their backs to the wall on the deal, and Schwartz said it's best that the city get rid of the building because of controversial circumstances under which it was acquired in the first place.
While selling the building does little to reimburse Margate taxpayers for the loss of Alzheimer’s Funds over the years, it may enable the CRA to retrieve its initial investment and then some.
Where CRA staff goes if and when the office building on Atlantic Boulevard is sold is anyone’s guess.