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Psych center land deal talks focus on what “fair market value” means

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As the city of Ogdensburg and the state begin discussing the turnover of 45 acres of the St. Lawrence Psychiatric Center Campus to the city, much of the talk will revolve around the phrase “fair market value.”

The language of the state Legislature bill passed last week that authorizes the transaction states that it will take place at a fair market value – and proponents of the handover think that anything more than $1 would be too much.

“Fair market value, I would say, would be pretty low considering they haven’t been able to sell it two times when they put the proposal up to do that,” state Sen. Patricia A. Ritchie, R-Heuvelton, said, referring to the state’s failed attempts in 1999 and 2002 to sell part of the property on its own. “I’ll continue to advocate that that be done for a dollar.”

The city is hoping to convert the property, which stretches from the Ogdensburg Bridge and Port Authority industrial park to the psychiatric center’s Children and Youth Facility along Route 37, into a commercial center.

In addition to that property, the city is also hoping to eventually take over and redevelop an additional 115 acres that includes wooded land, waterfront and the property on which the Ag Energy LP cogeneration plant is located.

Mrs. Ritchie said any consideration of what a fair market value for the property is should bear in mind the history of failures on the part of the state to sell the property. She said that if the state insists on putting too great a burden on the city, it could jeopardize future development efforts.

Specifically talking about the waterfront piece, Mrs. Ritchie said that a fair market value might be too much for the city to handle, making redevelopment unlikely.

“That definitely would be unfortunate considering the fact that that land has been vacant for so long,” she said.

Mrs. Ritchie and Assemblywoman Addie J. Russell, D-Theresa, said the fair market value language was added to the legislation at the behest of Gov. Andrew M. Cuomo’s office.

A spokesperson from the governor’s office declined to comment about the language.

Mrs. Ritchie said, “In the final hours, in order to get the first 45 acres transferred, that was a sticking point. We had to agree to fair market value, which we really didn’t want to do, but it at least moved it in the right direction.”

Mrs. Russell said she hopes that the issue of price can be settled contractually.

“Perhaps there is a manner in which the state could be reimbursed after the property is sold by the city,” Mrs. Russell said.

Both Mrs. Ritchie and Mrs. Russell said that they felt it was more important to get the conversation started than get hung up on the price issue.

“We wanted to make sure that at least we got the ball rolling. I do think that there is an opportunity for more discussion,” Mrs. Russell said.

Ogdensburg City Manager John M. Pinkerton said they haven’t figured out who will appraise the property yet, but that he is hopeful that there is room for discussion about what, exactly, “fair market value” means going forward.

“In the past the state has tried to sell the land, and when they tried to sell it, they tried to sell it with vacant buildings on it, which were in much better shape 12 to 15 years ago,” Mr. Pinkerton said.

He said he believes there is time to nail down what the state wants to charge the city for the property.

He said there may be funding to help both parties jump over that hurdle.

“People will talk to us now because there is something on the table,” Mr. Pinkerton said. “That door is now open.”

But a high valuation on the property could threaten another key part of the city’s plan to eventually rehabilitate and redevelop a substantial chunk of St. Lawrence River frontage at Point Airy.

“Our plan includes a redevelopment fund,” Mr. Pinkerton said. “As we take over the land that’s most easily developable and generate income, that income would then be used to take over less desirable land.”

Mr. Pinkerton said the most challenging parcels to redevelop will be the aging buildings on the grounds that are, in some cases, filled with asbestos and lead.

“The fund would be in jeopardy if the city had to start funneling money to the state,” Mr. Pinkerton said. “Maybe they could come away even, but they won’t be able to take over other land. The only way to solve this problem that’s logical and that really does something for the community and the state is to have the city start taking parcels of land, getting value for it, and using that to take non-valuable land. That’s the only way I see that this is going to work.”

Mrs. Ritchie said she plans on reaching out to the state Office of General Services, the agency tasked with facilitating the land transfer, to work on a solution.

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