City backs out of parking garage deal with county

Aug 10, 2024 By Paul Paterra 4 min read

Washington County has asked the Washington Parking Authority to reconsider its decision Wednesday to turn down a $4 million offer to buy the Crossroads Parking Garage.

The county wants to purchase the garage for parking for its employees, who now park at the Courthouse Square garage, which is targeted for demolition to make way for construction of a new public safety complex.

In a letter to the parking authority, commission Chairman Nick Sherman expressed disappointment and frustration that the county’s offer was not accepted.

“The decision not to reach an agreement will force us to build our own parking garage on county property, creating a significant financial burden for Washington city residents and school district taxpayers,” Sherman said in the letter. “Additionally, the lack of revenue from the existing garage will lead to further disrepair and continued loss of city revenue.”

Sherman said he thought an agreement had been reached at an appraised value of slightly more than $4 million determined earlier this year.

“My team and I engaged in a series of productive negotiations with Washington Mayor JoJo Burgess and other city and school officials and were optimistic that we had reached an agreement to acquire the property,” Sherman wrote. “Regrettably, the situation took an unexpected turn (Wednesday) when the parking authority did not accept our proposed agreement.”

The garage is owned and operated by the parking authority, but money from a sale would be distributed to the city, the Washington School District and the county, due to a tax-increment financing plan used to build the garage in 2007. The city, which owns 50% of the garage, and the school district, 43%, would receive the bulk of the revenue. The county owns the remainder.

Burgess said once debt service is taken into account, the $4 million drops to $2.7 million, plus the county would get its 7% cut.

“That would significantly undercut everything the city and the school district would have made from the deal. It just wasn’t worth it,” Burgess said Friday. “When we got the money breakdown on paper from their solicitor, there were a lot of inaccuracies on how the money was supposed to be spent and split.

“(County Chief of Staff) Daryl Price tells us that if we don’t play ball the way they want to they would use eminent domain to take the parking garage. I will not be threatened and bullied into something because you’re not getting what you want. I’ve talked to our solicitor and my council members and we are united in this. If we do not get a fair deal, that garage will not be sold to the county.”

When contacted Friday, Sherman said the county was under a tight deadline, as it was using a portion of federal American Rescue Plan Act (ARPA) funds for the purchase, and plans must be in place by Dec. 31.

“We had to have this done by August,” Sherman said. “I’m under the opinion that this wasn’t a priority (for the city). They sat on their hands for three months. The county was reminding them of our deadline and now we’re up against that deadline and they’re saying we want to negotiate and want more time. We’ve been talking about this for six months.”

Sherman also said the garage cannot be sold for more than the appraised price.

“I thought we were all signed, sealed and delivered, then I go to the parking authority meeting and (the mayor) said the city is no longer interested in selling the parking garage,” Sherman said. “Had I not gone to that meeting, when did they intend on telling us that they had pulled their offer?”

The mayor said only Sherman and Price have been involved in negotiations and not the other two commissioners.

“We’ve got to get everybody in the room,” Burgess said. “All we’re asking is that the county be transparent, bring everybody into the room and let us know what’s going on and let us make a decision.”

The garage opened in May 2007 and cost an estimated $14.1 million to build. Since then, the garage has been losing money. Sherman said a parking authority audit showed the garage would depreciate by $350,000 annually.

“Not only would they get away from the debt they have on that garage, a building they’re losing money on, we could have taken that building and put capital money in it, fixed it up and used it,” Sherman said.