Fort Wayne City Council expresses concerns about deal, then spends $4.63 million on downtown land

City Council voted 5-4 Tuesday to pay $4.6 million for the "North River" property -- and obligated taxpayers to cover the cost of cleaning up the contaminated site. (File photo by Kevin Leininger of The News-Sentinel)
Paul Ensley
Glynn Hines
Michael Barranda

All nine City Council members expressed concerns about the process: how they were given just weeks or even hours to review and consider important information; how they were denied details about possible contamination; how their vote could obligate taxpayers to clean up an undefined environmental problem created by someone else.

Then five of the nine decided in a preliminary vote the potential rewards outweighed their own misgivings and the public risk and agreed to pay $4.63 million for a 29-acre former industrial site just north of downtown — the “North River” site city officials believe will be crucial to downtown and riverfront development plans and will ultimately generate more than enough taxes to cover remediation costs that are now the city’s responsibility.

Later in Tuesday’s meeting, the board cast a final 5-3 vote to buy the property. Michael Barranda, R-at large, who originally opposed the purchase, was absent for the final vote.

Perhaps the most important and surprising vote cast Tuesday came from Paul Ensley, R-1st, who has steadfastly opposed most taxpayer-subsidized economic development proposals. Ensley said he was uncomfortable with the choice, but said the potential value of the property outweighs other considerations. Currently, the vacant acres — most recently an OmniSource scrap yard — generate about $15,000 a year in property taxes. Development by for-profit businesses would potentially generate far more, helping to cover clean-up costs.

Perhaps the most vocal opponent, however, was Glynn Hines, D-6th, who called the deal a “swindle situation.” If his fellow council members were troubled by the proposal, he suggested, they shouldn’t vote for it.

“The (owners) owe this community, where they made their millions, transparency. Instead, they chose to strong-arm the community. This is one of the worst-negotiated contracts I’ve ever seen brought before us,” he said.

Barranda, an attorney, framed his opposition in more legal terms. Grilling representatives of owner Calhoun Investments LLC, Barranda said he would have been willing to sign a non-disclosure agreement had he been allowed to see the results of a 2007 environmental assessment of the site, but the owners would not do that unless he also sign the agreement under which the city would assume all liability for contamination there.

Excitement over potential uses of the property, he said, “should be tempered with logic and reason. This (deal) fails on accountability and transparency.” Council was given a detailed purchase agreement to consider not long before the meeting.

In addition to Ensley, also voting to buy the property were President Tom Didier, R-3rd; Geoff Paddock, D-5th; Tom Freistroffer, R-at large; and John Crawford, R-at large. Voting “no” with Barranda and Hines were Russ Jehl R-2nd; and Jason Arp, R-4th.

Arp said he believed the city’s rejection of the deal at a price about $1 million above appraisals would make the land more affordable and attractive to the private sector, which he said should develop the property instead of the city.

Crawford called the decision “exceptionally hard, not a good deal,” but said it “might be the best deal possible.” Clean-up costs have been estimated at several hundred thousand dollars, but even if the cost turns out to be $2.5 million, the land might be worth it, he said.

Jehl, however, expressed dismay that the nine council members were not able to properly fulfill their obligation to safeguard taxpayer money because they were denied information they needed to cast an informed vote. “I have to be able to look my constituents in the eye,” he said.

The administration of Mayor Tom Henry expressed no such reservation, however.

“We’re pleased with tonight’s outcome. Having control of the property is important to ensure a viable private development in the future. We’re encouraged to be moving forward,” spokesman John Perlich said in a statement.