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Salem Council votes down new City Hall Annex lease

Posted by Sean Teehan  March 11, 2011 11:57 AM

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After barring the mayor from speaking on the issue, Salem's City Council voted down a controversial new five-year lease for the City Hall Annex.

Four council members voted against a five-year annual $349,000 lease with RCG, who owns the 120 Washington Street property, after one objected to Mayor Kimberley Driscoll addressing the panel on the matter.

"That's shameful, you ought to be ashamed of yourself," Driscoll said to Councilor at Large Steven A. Pinto after he refused to withdraw his objection to her speaking.

"We've heard it three different times," Pinto said when Driscoll asked him to allow her input. "We voted it down once, we voted it down twice, and according to our handbook... no matter is supposed to come in front of us a second time or a third."

RCG offered the new lease after the city put out a request for proposals for office space last summer in anticipation of the approaching end to a ten-year lease on the City Hall Annex. The city planned to use the building temporarily while waiting for other properties such as the Salem District Court to become available. That lease, which expired Feb. 28, cost the city about $392,000 per year.

The city received two bids, the lower one coming from RCG, which required a five-year commitment with an escape clause allowing the city to exit the lease after three years if they bought or built new space. The new lease also promised renovations to the 120 Washington St. building such as HVAC upgrades and new carpeting.

After the lease expired, the city is allowed to renew it at the $392,000 rate it paid under the 10-year lease that expired last month. Under this agreement, the city has the option to renew the lease annually for five years. The deal does not include any renovations to the building.

The lease first appeared before the council Feb. 10 when it failed to garner the two-thirds majority required for it to pass. A second version passed two weeks later when the council amended the exit clause to allow them to break the lease if they pursue "alternative" office space. RCG did not accept the terms, which put the matter front of the panel a third time last night.

Ward 5 Councilor John H. Ronan called the repeated votes on the lease "nails on a chalkboard" last night.

"It's a bad lease," Ronan told the council. "It was a bad lease when we defeated it, it was a bad lease that we tried to make better last week, we should let our votes last week stand."

Ronan argued in previous meetings that the council could negotiate a better deal at a later date.

Citing upcoming decreases in local aid and other budget cuts, Councilor at Large Joan B. Lovely argued the $42,000 in savings would prove substantial.

"We're looking at some pretty grim numbers, we don't know the affect the number means for Salem, but we know that it's going to be significant," Lovely said. "We're down to pinching pennies here, it's not about big dollars anymore, it's where can we save pennies."

Ward 2 councilor Michael Sosnowski, a swing vote who initially opposed the lease, but voted in its favor when it came up a second time, said although he believed the deal to be the best currently available, he feared a commitment to the lease when a better solution could present itself.

"What happens if we found an option that's neither A or B? What happens if we find C?" Sosnowski asked. "I don't want my hands tied."

After Pinto refused the Driscoll's request to address the council following Ronan's lambasting of the matter's multiple appearances before the panel, Ward 3 Councilor Jean M. Pelletier, who spoke in favor of the lease, left the Council Chambers telling Council President Jerry L. Ryan he was "not feeling well."

Several other council members also stated their disapproval of barring the Mayor from speaking on the issue.

Driscoll also stormed out of the chambers after Ronan, Pinto, Sosnowski, and Ward 6 Coucilor Paul C. Prevey voted the lease down in a 6-4 decision.

"I'm extremely disappointed," Driscoll said in her office after the vote. "It's going to be a difficult budget season and $42,000 is significant," she added, noting the money is around the starting salary for a new teacher.

After the meeting, Pinto argued voting down the lease could prove beneficial in the long run.

"We can renegotiate next year and maybe say more," Pinto said.

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