Fort Smith Board discusses FCRA meeting, city hall rent agreement

The Fort Smith Board of Directors passed resolutions at its regular meeting Tuesday night (March 5) approving a five-year lease of the building used as City Hall and requesting a public discussion with the Fort Chaffee Redevelopment Authority.

The board unanimously approved a second option for a five-year lease of the space used as city hall at 623 Garrison Ave., in downtown Fort Smith, with rent at $33,500 per month – $1,000 more than the rent charged in the lease that expired Feb. 29 for this year – and $34,500 a month in 2025. Rent will go up $1,000 a month each year through 2028. City Administrator Carl Geffken said this is the same increase in rent the city has paid annually in the past.

The city occupies all of the third, fourth, and fifth floors of the building along with office space and a vault on the first floor and the breakroom and bathrooms on the second floor. There is more space available on the first floor and the second floor and the entire sixth floor. The lease has an option for the city to add space to the lease in the future if needed.

The board was presented with two options of the lease. The other option was to rent the entire building for $32,500 a month from March to August of this year and $47,766.81 per month for the remainder of the lease through August 2029. Both options included a provision for an option to buy the building after the five years.

At Tuesday’s meeting, Director Neal Martin said he would rather the city just buy the building now.

“We got an appraisal for this building – $3.98 million. Since 1977, we’ve paid $8 million (in rent for the part of the building we occupy). So, we’ve bought the building twice. You know, looking at this, lump sum, $2.3 million for five years would basically pay half of this appraised value,” Martin said. “We threw numbers around $25 million for a new building. … I have been talking about the pressures that are on us from new needs. … But from a long-term perspective, putting an offer on here and buying this building, I don’t know if that’s not the best option at this point.”

That option was not presented to the board by the owner of the building.

Director Lavon Morton suggested the city look at expanding its space in the building to what is needed to accommodate all those who need to have work space in the building in an expedited manner.

FCRA ANSWERS
A resolution requesting the chair of Fort Chaffee Redevelopment Authority Board of Trustees to attend a future study session or board meeting was included on Tuesday’s night’s agenda in hopes of getting answers to questions regarding the dissolution of the trust presented to them by the four beneficiaries of the trust that were sent to FCRA in August.

In a memo on the resolution, Geffken summarized the matter saying the Fort Smith Board of Directors requested a meeting of all the FCRA beneficiaries and the FCRA board in order to discuss and determine FCRA’s plans regarding dissolution. Representatives of the four beneficiaries of FCRA – Fort Smith, Barling, Greenwood and Sebastian County – met on Aug. 7 and agreed to a list of questions that was then to the FCRA Board of Trustees and executive director by Geffken.

“It has been seven months since the email was sent and the beneficiaries have not received a reply. This resolution requests the chair of the FCRA Board of Trustees to come to a board meeting or study session of the City of Fort Smith Board of Directors and provide answers to the questions contained in the resolution,” the memo said.

Daniel Mann, FCRA executive director and chief executive officer, and Dean Gipson, chairman of the FCRA trust, sent an email to Geffken and members of the Fort Smith Board of Directors Monday (March 4) after seeing the resolution on Tuesday’s agenda. In the email, they answered the 10 questions regarding dissolution of the trust, noting that while it is too early to know exactly how long it will take to complete all that the trust needs to do and go through the process of dissolving the trust, they believe it will take less than 10 years to do so. It also noted that dissolution could be done in less than three years.

Director Christina Catsavis asked if anyone knew if the entire FCRA board of trustees reviewed the questions from Fort Smith and the other beneficiaries and if they participated in the response. Geffken said the original email asking the questions about dissolution was sent to all the trustees on Aug. 8. He said he did not know if any of the other members of the board of trustees participated in the responses.

“I’m not satisfied. I would like a sit down meeting (with FCRA). I’ve provided everyone on the board a copy of the land that FCRA is showing as marketable. It’s color coded with notes, several engineering firms have worked on this. As you can see, a lot of it is in the floodplain. … Some of it they don’t even own. Some of it is cemeteries. So what they are saying is over 1,000 acres of marketable land is actually more around 400 acres,” Catsavis said.

Catsavis said she also has concerns about how FCRA is handling property that has already been sold. FCRA requires those purchasing property to develop the land within a certain amount of time. If the land is not developed within that time, the developer can ask for extensions. The board of trustees can also take action to repurchase the land.

“Interest rates have doubled on people since they bought (the land), and now they are being forced to develop. And it’s just a recipe for foreclosures. We certainly do not want that out there. That’s one of my concerns. That’s why I would like to bring them to the table and have an in-person meeting,” she said.

No one from FCRA was present at Tuesday’s meeting. However, Mann did contact Catsavis before the end of the meeting asking for a copy of the map she referenced. She said in the board member’s comments that she would happily provide him with a copy at the in-person meeting.

The board voted six to one to pass the resolution requesting the chair of the FCRA attend a future Fort Smith BOD study session and provide answers to the 10 questions regarding the projected timeline for dissolution. Director Jarred Rego voted against the resolution.