By Krystal Spring/Havre Daily News/kspring@havredailynews.com
The Heritage Center may have to close its doors if state and federal officials don't soon decide the financial consequences to the city if it sells the historic building it purchased with federal highway funds, Havre Mayor Bob Rice said Tuesday night.
"As of today, they still haven't given us an answer. (MDT) is really leaving us up in the air," City Council member Tom Farnham said during Tuesday's City Council meeting. "We're quickly approaching the winter heating season and we don't have the money to pay for that."
Rice met with officials from the Montana Department of Transportation and the Federal Highway Administration on Aug. 25 in Helena to discuss the city's intentions to sell the building to a private entity. But the city is still waiting for answers on whether or not it will have to pay back the $150,000 in Community Transportation Enhance-ment Program funds used to purchase and renovate the building if it moves forward with plans to sell the downtown landmark.
"Until we hear in writing from the state and federal government, I don't see how we can proceed," Rice told the City Council.
The City Council had planned to vote Tuesday night on which purchase offer to accept.
Rice said the city sent a "hardship proposal" to MDT and FHA on Tuesday, outlining the city's reasons for wanting to sell the Heritage Center. He said officials from the two agencies in Helena were concerned that the city wasn't asking for more money from the building's two interested buyers.
"They believe the building is worth at least $100,000 and they don't want us accepting anything less," he said.
Hill County had the building appraised in June 2003, which determined it was worth $320,000.
The city took over management of the Heritage Center on July 1, after the H. Earl Clack Foundation - which had leased the building since 1996 - relinquished management of the building, saying it couldn't afford to continue to do so. The city purchased the former post office and federal courthouse in 1996 from the U.S. Postal Service, with $89,600 in CTEP funds. The building houses the county's H. Earl Clack Museum and some business offices. The City Council voted June 21 to consider selling the building to a private purchaser.
For the past two months the council's Finance Committee has been reviewing bids from private entities to buy the building. But plans to sell it were put on hold when concerns arose about whether the city would have to repay the CTEP money.
The Finance Committee has been considering offers from two prospective buyers. Jim Treperinas offered the city $1 for the building. He said he would make necessary roof repairs and other building improvements, so the building's office space would be more attractive to prospective renters.
Tom and Jamie Lambrecht have presented two options for the building. The Lambrechts' first option, a public-private partnership, outlines the couple's plan to pay the city $5,000 for the building, plus an additional payment equal to a 13 percent match for CTEP funds they would use to complete the planned roof project. It would also require a five-year graduated tax abatement on the building.
The Lambrechts' second option is a $20,000 cash purchase, relieving the city of "any and all obligations associated with the building."
Rice said if the city can't sell the center, its only option is to close it. The Heritage Center brings in $3,000 in revenue every month from tenants, but city officials estimate it costs $4,000 a month to operate the building, leaving the city with a $1,000 shortfall each month.
That does not include a heating bill, Farnham said.
"We need to have a decision from MDT in hand by our next council meeting on the 20th, or we'll have to look at closing it down," Farnham said. "We don't have the money to continue operating the building, especially when winter hits."
City Council member Emily Mayer Lossing has urged fellow council members to place a question about the Heritage Center on the municipal election ballot in November 2005, leaving the fate of the historic building to voters. Mayer Lossing proposed that city residents pay a flat fee of $24 to support the building, keeping it in public hands.
In other council news:
Lou Lucke, a member of the Hill County museum board, proposed framing a series of historical pictures to be displayed in the hallways of the Heritage Center. The photos would be dedicated to longtime Havre resident and Montana State University-Northern associate professor Cameron Worstell, who died Aug. 17. Lucke said Worstell had once encouraged him to utilize the wall space in the center to display Havre's rich history in photographs.
"It would be a fitting memorial for someone who has done their duty as a citizen of this city," Lucke said.
The idea was approved by the council but until the fate of the Heritage Center is known, the photo dedication cannot be pursued.
The council approved the first reading of an ordinance that would prohibit on-street parking for recreational vehicles and trailers year-round within the city limits. The ordinance will go before the council for a second reading Sept. 20 at 8 p.m.
The City Council approved a preliminary $12.1 million budget for the city for fiscal year 2004-2005. A public hearing on the budget will be held Sept. 13 at 7 p.m. The City Council will give final approval of the budget Sept. 14 at 7 p.m.
