Danville reviews lease agreement with Art Center
Published 4:26 pm Thursday, February 16, 2023
The City of Danville will be buying a building at 415 W. Main Street for the Art Center of the Bluegrass’ expansion project. During Monday’s city commission meeting, the commission reviewed an agreement for the city to lease the building to the Art Center for $1 per year.
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The building is next to the Art Center’s current building. They will be renovating it to add a museum and other arts services and programs.
The Art Center recently bought the building from Serendipity Sisters, LLC for $525,000. Danville will be buying it from the Art Center, so the Art Center will have more money for renovations.
The Art Center will pay for all renovations. They will be fundraising for the multimillion dollar project, seeking both public and private funds.
The lease agreement would include full use and occupancy for $1 per year for a 30-year term, renewable for up to two additional terms.
The commission already approved the purchase contract, and the proposed closing date is at a Feb. 23 special called meeting.
During the “hear the public” time, citizen Wilma Brown said that before this point, taxpayers were not given much notice that this would happen. The commission did not mention this project in any recent regular commission meetings.
Another concern she mentioned is that the project would not be income-producing for the city, especially since the city would pay the Art Center’s utilities.
The Art Center’s new building would mainly house a glass museum in honor of Stephen Rolfe Powell. It would also have a glass-blowing studio, rent-able spaces, an art cafe, and other things.
“That’s a very narrow focus for the Art Center; the building they are in right now has a very broad focus that serves the community in a very broad way,” Brown said. “When you start talking about a museum, the focus narrows and then you’re talking about using public funds.”
City Manager Earl Coffey explained that the city is using ARPA money for the purchase, which is an eligible expense for those funds.
“I’m wondering if there’s a better place for a museum, I’m wondering if there’s a better use for this money that’s coming to us from the federal government,” Brown said. “I just want to hear more from the city commission as to why you’re spending this money on this particular project, when there are many projects in town that could perhaps use this money.”
Coffey said that the ARPA funds have a deadline on them, and there are currently no other projects competing for that money. Danville has already used much of their ARPA money for current and upcoming utility projects. Other eligible projects received other funding.
“So then, how do you make [the money] as long lasting as you can?” Coffey said. “Putting money toward renovation doesn’t give you full claim to the money in the future per se, if the building is solely owned by the Art Center.”
He explained that buying the building can protect tax money in the future, because the building is an asset. If the structure is ever abandoned, the city can either sell the building or use it in another way.
In wanting to support the Art Center’s initiative, Coffey said buying and leasing the building is the best balanced way for the city to do so.
The new building’s utilities will be paid by the Art Center, but will be subject to reimbursement by the city. This system is different from what the city has been doing for the Art Center’s current building.
Danville has been paying the Art Center building’s utilities since they started renting it 20 years ago. However, City Attorney Stephen Dexter said those payments can blend in the budget, making it hard for citizens to notice what the city’s paying.
“You don’t know the full value of your partnership with them because it’s just a part of the city’s regular utility payments,” Dexter explained. “[For the new building], they can submit the utility bills that they pay ahead of time for reimbursement, during a normal agency allocation process.”
In order to fully review the lease agreement, the commission tabled the matter until their next meeting.
Finance Director Leigh Compton proposed reducing insurance premium tax in the city from 10% to 8%. She explained that in 2020, the city increased insurance premium tax from 8% to 10%.
This was to generate $300,000 to $400,000 more income. But Compton said they exceeded that significantly, mostly due to increases in individual premium rates.
“A lot of sources are saying that between 2020 and now, insurance premiums on individuals has risen up to 15%, which is very high,” Compton said.
Compton said reducing this tax would not significantly impact the city’s budget, and would not be detrimental to revenues.
She said in projecting this tax’s revenues to future years, if reduced to 8%, the average loss in revenue would only be about $70,000. Considering their overall budget, Compton said they could absorb this amount.
Danville’s current 10% rate is very high compared to cities of similar population. Other cities at 8% include Richmond, Georgetown, and Lawrenceburg. Louisville and Lexington are at 5%.
An ordinance will be prepared for the next meeting. If approved, the change would go into effect for the next fiscal year in July.
Utilities Director Marshall Carrier discussed an idea to stop sending delinquent utility bill notices by mail. He said they would like to start an automated calling system instead.
Right now they send monthly delinquent notices to customers who are late on utility bills. However, Carrier said that these notices come in the mail very close to when people also receive the upcoming bills.
“It can be difficult at times for those customers to understand what it is they truly are to be paying for their water bills,” Carrier said.
When the city moved from bimonthly to monthly billing, some customers inadvertently went on the delinquent list, creating additional confusion.
It costs the city $2,500 to $3,000 a month to send delinquent bills by mail. Instead, they would send automated calls to people saying they owe a delinquent amount to the city. Customers will then have to contact the water department to find out what they owe.
Carrier said they are stressing to all customers for them to provide the best phone number to reach them at.
Carrier wants to remind citizens that utility bills are due on the 10th of each month. Credit card payments take 24 hours to post, which is important to remember when making a payment around the time of delinquent shut-offs.
Cash or check payments can also be made at Farmers National Bank branch locations in Perryville and Junction City at no additional charge. These payments also take 24 hours to be applied.
If making a past due payment, citizens should contact the Water Office by calling 859-238-1200 and choose options 1 and 1, to ensure that the payment has gone through to avoid a delinquent shut-off.
If utility payments are made via online payment, reconnect fees must be included before a customer is turned back on. The reconnect fees can also be paid in person separately, but must be accounted for before service can be provided.
Any questions regarding utility accounts should be directed to the City of Danville Water Department at 859-238-1200 (select option 1 for Utilities and 1 to speak with a representative), or visit City Hall, open Monday to Friday from 8:30 a.m. to 5:00 p.m.
Carrier also said the city’s sewer system gets debris backup from people flushing facial or baby wipes, diapers, towels, expired medicine, and other things that should not be flushed. He reminded people to not flush anything down the toilet except toilet paper.
In other business, the commission:
• Passed the first reading of Ordinance 2006 for a zone change at 2170 Shakertown Road for 24 acres. Danville Christian Academy applied for this zone change from agriculture to institutional campus district. This land is not being used for agriculture, so the change will bring it into compliance. The school may use that land for future development.
• The city was awarded a Federal Highway Safe Streets for All grant, to develop a Vision Zero safety plan. The grant is for $160,000 which the city will receive in the next few months. The safety plan is to determine what the city can do to reduce car crashes. City Engineer Josh Morgan said they will look at all city streets and analyze crash data.
• Morgan gave an update about constructing Memorial Plaza at the new fire station. The project had been put on hold. Due to very high estimates for contracting the construction, Morgan is looking to have in-house workers do the project. The city may contract part-time help as well. Morgan said in-house workers could start as early as March, and will take a few months to complete.
• Reappointed David Camic to the Parks and Recreation committee.
• Appointed Dan Nolet to Planning and Zoning to fulfill the term of Vince Dimartino.
• Reappointed Gail Lewis to the Senior Citizens Board.
• The city is planning the Economic Development summit to be at Boyle County Performing Arts Center on March 17. It’s open to surrounding community governments to learn about economic development practices. The public is welcome to attend.