Kink found in Bank of America deal
A deal between the city of Cairo and Bank of America to purchase the former bank building for use by the Georgia Department of Labor appears uncertain.
City Attorney Thomas L. Lehman briefed Cairo city councilmen Monday night concerning the ongoing negotiations with Bank of America attorneys to close on the purchase.
According to Lehman, language has been introduced in the sales contract that would require the city to close by July 31, 2011, regardless of whether or not a clearance letter from the Georgia Department of Natural Resources Environmental Protection Division regarding environmental issues on the property has been issued or not.
The city had proposed dividing the property into north and south tracts and closing on the south tract, the site of a former gasoline station, once EPD gave clearance and issued a letter require no further action in environmental mitigation on the property.
“We never discussed anything any different, but I wanted to let you know that paragraph slid in there is the subject of controversy,” Lehman told councilmen.
Lehman updated City Manager Chris Addleton late last week of the latest development and Addleton, who was absent Monday night, has had email correspondence with Bank of America officials.
“I don’t know what their response is, but I think the city is sound in its decision not to take the property until the clearance letter has been issued. If no letter is issued, the city is stuck,” Lehman said.
Mayor Richard VanLandingham agreed and he told the city council he favors exploring other options.
“The whole reason we are doing this is for the Labor Department and working to keep their office here in Cairo. There are other options we can look at. I don’t think we should agree to something when it is not right. We can still take care of the Labor Department with other options if Bank of America does not cooperate, and right now Bank of America is not being reasonable,” the mayor said.
The mayor said he was the first contact with Bank of America and he said bank officials were “happy” to have a buyer for the property. But now, he said, attorneys representing the bank are being “unreasonable.”
Lehman said that bank attorneys have required three separate contracts. A 44-page contract covers the sale of the property; a 37-page contract is the lease allowing the bank to continue to operate the walk-up automatic teller machine on the southside of the building; and a 32-page contract is for the lease of a new drive-up ATM the bank is to erect on the southern end of the property.
Councilmen Lannis Thornton, Ernest Cloud and James H. (Jimmy) Douglas, the only councilmen present Monday night, backed the mayor and agreed the city should press for the separate closings and at the same time investigate other options.
City Clerk Carolyn Lee reported to the council that the Department of Labor has been notified of the delay and has agreed to postponing the start of the lease of the new facility until April 1, 2012. The effective date of the lease agreed to by the DOL and city earlier this year was to have been Nov. 1.
Based on the lease agreement, the DOL is prepared to pay the city a monthly rate of $4,751 to lease the Bank of America building.
The purchase price the city has agreed to pay for the former bank building is $150,00. However, the city is anticipating spending between $300,000 and $350,000 for the required renovations and alterations to the building to suit DOL requirements.
The city manager is anticipating 90 to 120 days to complete the renovations and expansion of the facility for use by the DOL.
In other business Monday night, the council:
Discussed sewer issues with Doug and Patti Spitler and Becky Teasley at 327 4th Ave. S.E. Spitler was seeking financial assistance from the city for the replacement of sewer pumps that are required to pump sewage to the city line. Mayor VanLandingham said the city could not offer assistance to one resident and not all others that depend on similar pumps. When the pump was first installed, at city expense, the pumps were guaranteed for two years, and Spitler acknowledged the first pump operated for five years before it quit.
Voted unanimously to cancel the Monday, Dec. 26, meeting due to the Christmas holiday. The council also voted to cancel the Monday, Jan. 23, 2012, meeting and authorized the city manager to reschedule it, if necessary.
Heard an update from Attorney Lehman regarding legal action taken by Elbert Walker against the city regarding the demolition of the former Chickasaw Club. Walker appealed the action taken in Cairo Municipal Court to Grady Superior Court and has now appealed to the Georgia Court of Appeals. Lehman said the appeal was not filed properly and he is preparing to file a motion to dismiss. “I should know more by the next meeting,” Lehman said. The city demolished the dilapidated former night club through its nuisance abatement process.