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'You can't make this stuff up'

County employees have not moved into former bank building four years after purchase

October 06, 2012|By ARNOLD S. PLATOU | arnoldp@herald-mail.com
  • County Adminstrator Greg Murray walks thru the basement at the former Home Federal and PNC Bank next to the County Adminstration offices on W. Washington St.
By Ric Dugan/Staff Photographer

More than four years after Washington County’s government paid $3 million for a large office building in downtown Hagerstown, the structure still is mostly empty and unused.

Why that has happened is part plan, part result of Maryland funding cutbacks, part a change in priorities, and part pure foolishness depending on which of the five 2008 county commissioners, who split 3-2 in approving the deal, is asked about it now.

Most still are in agreement, however, with what was the original plan for the building — to set up floors of offices for some county agencies that are now blocks away, allowing them to work directly with other agencies in the county administration building next door.

Two of the commissioners said they were shocked late last week to hear that County Administrator Greg Murray has been discussing with staff a different idea.

Murray, in an interview Monday with The Herald-Mail, said he has been talking to staff about the idea of demolishing the largely empty building the county bought in 2008.

“I have discussed tearing that building down” if a possible source of new funding materializes so that a modern addition “with higher energy efficiency” could be built onto the administration building, Murray said. He stressed that he hasn’t mentioned the idea to the commissioners yet and so, no such change has been approved.

Told Thursday night by the newspaper about the idea, commissioners President Terry Baker and Commissioner John Barr said they were shocked.

“You can’t make this stuff up. This is absurd,” said Baker, who voted against the 2008 purchase and who had told the newspaper Sept. 28 of an unconfirmed rumor that the staff was holding “emergency demolition meetings.”

While Murray denied the demolition idea was motivated by any sort of emergency, Baker said the fact that top staff has even been talking about demolishing a building that cost millions is bad enough.

“You tear that down with all the cost we’ve got in it, just in the purchase price alone, with no demolition costs? The citizens have already paid $150 per 12-inch square piece of that land,” Baker said, referring to the building’s 80-foot-by-240-foot lot. “This is unbelievable.”

Barr, who was president of the commissioners in 2008 and voted with the majority to purchase the building then, said he was stunned that Murray would suggest such an idea.

“I’m sitting here with my mouth hanging open,” Barr said.

“Frankly again, I can’t imagine the public outcry that would come if we spent $3 million for a building — whether it was four days ago or four years ago — and then, we were going to ask city permission to demolish it?” Barr said. “I don’t know. Somebody’s really going to have to convince me of that one.”


Not what it seems

The former PNC Bank building appears from the front of its 120-128 W. Washington St. property to be a three-story structure with a rough-green exterior.

In fact, it is a two-story building with a finished basement on the left and, connected by hallways inside, a three-story red brick rowhouse with a basement on the right.

The appearance of it being all one building of the same height is something that deceived even Richard Phoebus in January 1981 when he began work there at what then was Home Federal Savings & Loan.

“I guess I was there three or four months when somebody told me what was going on there,” said Phoebus, who was Home Federal’s chairman, president and chief executive officer for 20 years.

The truth was, a thin facade about 10 to 12 feet high runs from in front of the third floor of the rowhouse along the front edge of the flat roof of the two-story building, giving the whole a three-story appearance, Phoebus said. The masking, not uncommon on older buildings, is supported by a concrete block wall on the building’s front side and on its back, which is masked as well.

Until the mid-1960s, there were three rowhouses on the property, which like all 520 of Hagerstown’s original lots, is 240 feet deep and 80 feet across the front. In probably the late 1960s, Phoebus said, two of the rowhouses were torn down and the new Home Federal building was built.


Fireproofing with asbestos

Back then, as was the practice, the construction crews “were spraying asbestos on beams to make them fireproof. They were completely encapsulated,” Phoebus said.

In the early 1980s, further protective steps were taken, he said.

“They actually built wallboard around them and shielded them in so that the dust would not get into the (office and other bank) rooms,” he said.

In the basement, “down in the dungeon, we called it, asbestos was used on all the pipes down there,” he said.

Over the years, the name out front changed. Home Federal Savings & Loan became Home Federal Savings Bank. Then, Home Federal was acquired by Farmers & Mechanics Bank, which eventually was acquired by Mercantile, which had a subsidiary named The Fidelity Bank.

It was Fidelity that in October 2006 sold the bank building, including its hidden rowhouse, plus a handful of properties that fronted on West Franklin Street in back of the bank, for a total of $1.4 million. The buyer was WWS LLC.


Approaching the county

Local residential and commercial developer David Lyles had an office just a block away from the bank in 2006, when he was contacted by PNC Bank, Hagerstown attorney Jason Divelbiss said. PNC, which had acquired Mercantile, was the latest financial institution to occupy the original Home Federal building, he said.

“PNC was saying, ‘We need a bigger office area. We need a new branch building. We hear you’re doing a new building. So, let’s talk,’” said Divelbiss, whose law practice often represents Lyles.

The developer was building The Lyles Center, a two-story office building in the North End. And PNC wanted to sell the downtown Hagerstown bank building to Lyles and move in to Lyles’ new building as a tenant, Divelbiss said.

So in summer 2006, while planning to buy the downtown building, Lyles went looking for potential tenants to add to the two law firms and the accounting firm already leasing space there, Divelbiss said. With the county government next door, he said, Lyles “would have gone to the county and said, ‘Hey, are you interested in leasing this building when PNC goes out?’”

Initially, the attorney said, the county seemed interested in moving its engineering department from the former Grand Union grocery building at 80 W. Baltimore St., which now was a county office building. Although the county’s interest faded, WWS — which Divelbiss said he thinks is short for “West Washington Street” and of which Lyles is a principal — went ahead with the purchase.

So, “really nothing came” of Lyles’ leasing talks with the county “until probably a year and a half later,” the attorney said. “That’s when the conversations started with the county about a possible purchase of the building.”


Considering the potential

The county wasn’t so much interested in buying the building as it was in buying the lots behind it, Murray said.

“Our primary goal wasn’t that we wanted the building next door,” Murray said. “The primary reason was, we wanted (the land in back as part of a site) for the transfer station.”

For years, he said, many County Commuter bus passengers had complained about an old transfer station that was under a city railroad bridge and some downtown merchants weren’t happy about the groups of bus passengers that waited in front of their businesses to change buses near Public Square.

In about 2005, studies were launched to evaluate potential sites for a new transfer station, Murray said. By 2007, he said, the commissioners had seen draft copies of a consultant’s plan that recommended putting a station near the county government offices at 80 W. Baltimore St., at a lot off East Antietam Street or on the largely undeveloped rubble-strewn lots behind the PNC Bank building.

Seeing the potential to “clean up blight,” widen a narrow back alley and choose a location close to social help agencies, government offices and the downtown, Murray said, the county focused on buying the lots WWS now owned and others for sale in the same block.

But, Murray said, when the county asked Lyles about buying only his lots there and not the building, where PNC still was a tenant, the developer balked. One of his lots that the county wanted was where PNC had its drive-through and neither PNC nor Lyles, thinking ahead to when he might need to recruit another bank tenant, wanted to part with it, Murray said.

That’s when the county realized it was going to have to buy the building in order to put the transfer station on the back lots, he said. And that’s when planning began to move some agencies out of the 80 W. Baltimore St. offices and into the bank building, he said.

However, when Murray and others of the county’s top staff walked through the building to check it out, they noticed lots of needs, he said.

“The building’s carpets were well-worn and stained. Walls were dinged and dented,” Murray said. An HVAC replacement system was needed on the first floor and, in the basement, asbestos was seen on the boiler pipes, he said.


Fixing, replacing and installing

When negotiations began and WWS “got down to their bottom line, we said, ‘That’s great. That’s your bottom line, but we’re not interested if you don’t fix that aspect,’” which included fixing, replacing and installing to deal with all of the problems seen, Murray said.

WWS agreed and did all of the work, including installing “brand-new” air-handling systems on the first floor and wall-to-wall carpeting throughout, he said.

The company also hired ACM Services Inc., an environmental firm that had the asbestos removed and hauled to an approved landfill in Ohio, and had another environmental firm “perform a final visual inspection and to certify through final air sample collection and analysis that the area is within regulatory limits for reoccupancy,” according to an ACM report that Divelbiss gave the newspaper.

All of the known asbestos was removed except an asbestos fireproofing coating on a steel beam that runs vertically through the building, Murray said. The beam is encased so well behind walls that, Murray said, he doesn’t even know where it is.

After the improvements were made and before the county voted to buy the building, the commissioners were given a chance to walk through it, and at least Barr and Baker did, Murray said. Asked about that later, Barr said he did go, but neither he nor Baker could remember whether Baker went.

Two city government fire safety and building code officials have each made an informal visit to the building, too, at the county’s request.

Former city Chief Code Official Mike Heyser, who now is the Community Development Block Grant code administration officer in Carlisle, Pa., told the newspaper on Sept. 27, “There’s nothing I recall that was alarming.”

City Fire Marshal Doug DeHaven said he saw nothing glaring.

“They can move in tomorrow if they keep things as they are and the current fire or safety features are working,” he said. “Only when they start doing modifications, moving walls, that sort of thing, do they now need to start working with the newer (safety) codes.”


Sealing the deal

In March 2008, a majority of the commissioners — James Kercheval, Kristin Aleshire and Barr — voted in favor of paying a total of $4.6 million for the bank building and all of the lots it needed for the transfer station. Of that amount, WWS was paid $3.3 million — $3 million of which was payment for the bank building itself.

Murray was quoted that day as saying that at least some county departments could move to the bank building in the next six months. Kercheval was quoted as saying “an obvious choice” is to move the engineering department from the 80 W. Baltimore St. building where, Aleshire pointed out, workers were so cramped they were “tripping over each other.”

Aleshire, to whom such consolidation of offices was an important economy and efficiency, said this week that those plans seemed to become less and less important as other projects pushed ahead.

“For me, (consolidation) was a much bigger picture that sort of shrank and shrank,” Aleshire said. “You had a push for the senior center at Hagerstown Community College, you had a push for the library going elsewhere (during construction of its new building), and you had a push for the transfer station ... which sort of threw the occupation of the PNC building into a spin.”


‘Move-in condition’

Buying the former bank building was opposed by Commissioners William Wivell and Baker. For them, a big obstacle was the price.

Poring over Maryland assessment records for all of the properties, Wivell said he “couldn’t come anywhere close” to the $4.6 million that the county was about to pay.

“I’m like, ‘Why are you guys paying double for what doesn’t seem worth it?’” recalled Wivell, whose term ended in 2010.

The county’s top staff kept touting the renovations done by WWS and telling the commissioners that the building is now “in move-in condition,” Wivell said. “And what I find interesting is, it’s five years later and they still haven’t moved in.”

Asked about that, Barr said the commissioners knew that beyond the “move-in ready” conditions that WWS had provided, were improvements needed to link the former bank building with the county administration building, so staff members could walk directly to one another’s offices. He and Murray said what they called a tower staircase that was to be installed outside where the two buildings meet in a corner also would overcome the problem of the respective floors in the two buildings being built at different levels.

Paying for those sorts of improvements has been difficult in a time when the state government has cut funding, costing the county “millions and millions” of dollars in aid, Barr said. As a result, he said, the commissioners have had to choose other priorities.

County spokeswoman Sarah Lankford Sprecher said in addition to still having the two law firms and the accounting firm as tenants in the former bank building, the county has been using it on occasion.

Sprecher said uses have included “for employee training, health information sessions through our Human Resources department and also the Election Board used it for early voting in 2010.” In addition, she said, the Property Tax Assessment and Appeals Board has held public hearings there.

Then, too, Murray said the county’s space needs have changed.


Changing plans

In 2010, Sovereign Bank said it would be ending its lease of 6,000 square feet in the county administration building the following year, he said. As a result, the county hired an architect to recommend how the county could use the space.

More recently, Murray said, the city unveiled its proposal to build a stadium downtown. If that is built, the city would need the space at 80 W. Baltimore St., which means the county would have to move those employees elsewhere, he said.

In all, the county has about 296 employees working downtown. They are spread among its administration building at 100 W. Washington St., its offices at 33 W. Washington St., the Washington County Courthouse on the corner of East Washington Street and Summit Avenue, and in the Baltimore Street building.

The silver lining to losing the Baltimore Street building, Murray said, is that the stadium proposal includes an initial offer of $1.6 million to buy the property from the county.

That money would be the “third pot” of three groups of funds that Murray said “might be an opportunity to do something real nice” in the way of a government office complex and enhancement to downtown.

He said the other two pots are the amounts he couldn’t recall offhand that the commissioners already have set aside to pay for moving employees into the former bank building “and, at some point, upgrading it” as well as paying for any construction needs to make the former Sovereign bank space useful.

So in discussing such possibilities with staff, Murray said, the question they’ve talked about is, “Do we take all this money and, basically, do a new addition to our existing (administration) building? ... Which is where any discussion of tearing down the old PNC building came up. So it was only in that context.”


‘A story to tell’

For Baker, the confirmation of “demolition” talk among staff is only the latest evidence of “what a lemon” the county has in the former bank building.

On Sept. 27, he told the newspaper, “I’ve heard asbestos, I’ve heard there’s mold, I’ve heard there’s — in between the second floor and the third floor, I’ve heard there’s a roof in there, which just blows my mind. I guess that would never, ever permit use because if you had a fire,” the roof materials would make it worse.

“I can’t comprehend or even begin to understand who the Einstein was to get us to purchase that building. I voted no,” he said.

Asked who told him about the asbestos, the mold and the roof, Baker replied, “That’s just talk I’ve heard around the building.”

He said the county’s staff is paid to monitor and report such problems to the commissioners.

“It’s never been brought to my attention. Never,” he said. “I wouldn’t mind big bold letters (in the newspaper) saying, ‘this building has a story to tell.’ You can even put my name with that.”

Asked how long ago he heard of the building’s alleged problems, Baker said it was in “the past six months.”

Asked whether he had asked staff or the other commissioners about the alleged problems, Baker said he hadn’t.

When asked why he hadn’t, Baker apologized.

“The simple answer is, it’s my fault that I haven’t looked in to it. No excuse. It’s my fault,” he said.


Checking it out

Last Thursday, Baker told the newspaper that within the last two weeks, he did walk through the building to see its condition for himself.

And, he said, he’s not pleased.

“It’s horrendous. It’s certainly not even close to move-in condition, currently,” he said. “I saw where the ceilings are leaking, I saw where they are replacing ceiling tiles, I saw where the carpet is all wet, I saw where the ceiling is exposed. I saw a room full of (what) appeared to be lead paint. I mean, it’s just dingy.”

Told that a reporter and a photographer had walked through the building earlier that day with Murray, the commissioner asked what had been seen. Told of a ceiling dripping water that Murray had explained as a leak being repaired after a recent rain and told that otherwise, large parts of the building looked to have good carpeting, paint and lighting, Baker said he doesn’t think the tour included all areas.

Baker said his preference would be “to sell (the building) as is, get rid of it. Why would we want the white elephant?”

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