Dix Park: The Deal is Done

Gov. Pat McCrory and Raleigh Mayor Nancy McFarlane were all smiles this afternoon as they announced that the state will sell the 308-acre Dorothea Dix Hospital tract to the city for $52 million. They announced the deal in a packed ballroom at the Governor’s Mansion — to great applause.

McCrory said the sale and development of the land as a destination park will help Raleigh become the showcase state capital everyone in North Carolina should want. McFarlane called the deal “truly a win-win” for both sides and said the park will help spur economic development in the city and the region.

Update: Terms of the deal can be seen here.

A quick Q&A:

1) Is this a good deal for the city? Yes. The price tag is up there at $170,000 an acre, and the state reserved the right to keep Department of Health and Human Services (DHHS) offices on the Dix campus for 25 years in one area and 10 years in another. But expect the state to move out faster. Meanwhile, the evolution of a park is a multi-generational activity, so the city need be in no great rush to evict DHHS as long as it is assured — as it is — that the state is going to vacate. Earlier offers by the state included what would’ve been a poison pill, with the state keeping its buildings and the high ground of the park for itself while selling the lower areas to the city. That didn’t happen.

2) Is this a good deal for the state? Yes. In fact, it’s a great deal for the state, which gets a major park for the capital city at no cost. Using this land for state offices is, first of all, shameful in light of the fact that the state closed the 150-year old Dix Hospital that was the reason for the campus in the first place; and second, it’s about the most wasteful use of 308 acres of prime property that you could imagine. The $52 million won’t make a big dent in state budget needs. McCrory promised it will be used for mental health programs, but even for that purpose, it’s a drop in the bucket. Nonetheless, the state could’ve given the land away for the park and had a good deal. Getting $52 million is icing on the thing.

3) What happens next? A contract must be written. Then McCrory gets approval from the Council of State, which he controls, and McFarlane gets a sign off by the City Council, which voted 8-0 this morning to approve the deal as outlined. No contract was executed today. What the two leaders signed was a statement of the terms.

4) Where’s DHHS going? Not clear. But McCrory emphasized that the Dix buildings it’s in are old and expensive to maintain. The state may lease a headquarters building somewhere or build one, or it may lease or build more than one building. But modern office space should be better and cheaper than the moldy old buildings on Dix. As for where new buildings could go, there’s room near the Capitol, there’s room along New Bern Avenue, there’s room on Blue Ridge Road using other state properties, there’s room in South Raleigh, the choices are many.

5) What’s the city have in mind for the park? Another excellent question. Many ideas have been floated, including carousels, an amphitheater, a botanical garden, open fields, walking trails, a hotel in the original hospital building and so on. Planners hired by the Dix Visionaries, a group of local business leaders, did a general schematic a few years ago. Raleigh has two major “passive’ park areas now at the N.C. Museum of Art and at Umstead State Park. Dix is supposed to be an “active” place that’s a draw for tourists, a so-called destination park that people come from miles around to see and enjoy. But what’s in it? As McFarlane said, the whole community is now tasked with figuring that out.

6) Where’s the $52 million coming from? The Raleigh City Council can simply borrow it by issuing notes against the city’s credit. Or, it can go to the voters and ask for approval to issue general obligation bonds, on which interest rates would be lower — they’d cost the city a bit less, in other words. If there’s a bond referendum, the terms of the deal are that it must pass in 2015 and the city must have its money by December 31.

7) Why is a park on this land a good idea? It is because a park will enhance the downtown area, which lacks open space. A park will enhance the streets immediately adjoining it, which are underused and prime territory for housing and commercial development. The park will be next to N.C. State’s Centennial Campus, with many possible synergies, and it also adjoins the State Farmer’s Market, which suggests many more cooperative possibilities. In short, this park is perfectly positioned for the long-term growth of Raleigh from small city to mid-sized metro and the hub of a dynamic Triangle region.