New 10-year lease with purchase option proposed
by Mark Reaman
The Gunnison County Library board of trustees has proposed a new lease with the town of Crested Butte with an option to buy the Old Rock Library. The proposal was made July 26 and the council discussed the offer on August 6 in an executive session during their council meeting. No formal response has yet been made and the idea of town selling the building had a lukewarm response at best.
The council agreed to see if the library board would work out some of the lease issues with a subcommittee in the near future and appointed mayor Jim Schmidt and councilmember Candice Bradley to reach out to the library board and engage in lease negotiations.
“The library board is unified on the proposal, and believes it meets the needs of both the town and the library district,” explained library district executive director Drew Brookhart. “The proposal ultimately removes required expenses for the town, guarantees library services in the Old Rock, and gives comfort to Library District constituents that money spent on the property benefits everyone in the district since it would become an asset of the district and not just the town.”
Under the proposal sent to the town in the form of a lease, the cover letter states that the district as the tenant “has a fiduciary responsibility to all of the citizens residing within the boundaries of the Gunnison County Library District… The Library District has a desire to guarantee library services at the north end of the Gunnison valley for current and future generations.”
The proposed lease has the district paying the town $1,000 per month in rent with a 1 percent annual increase plus an annual $4,500 payment. The lease states that the district may pay the town “the total sum due under this lease ($170,546.54) at any time and upon receipt thereof, Landlord shall convey the Premises to Tenant…”
The proposed lease has the landlord being responsible for most maintenance and repair issues including changing the light bulbs, washing the windows, removing the snow and doing painting and lawn care. Utilities such as heat and electricity would be covered by the town, while the library would be responsible for things such as phone and internet. The library district would be responsible for general janitorial work and signage.
The district proposal is for a 10-year lease. “The Library District is operating with several significant unknowns,” explained Brookhart. “The 10-year term allows the Library District enough time to compensate the town of Crested Butte for their capital expenses without endangering the current level of library service, regardless of other variables.”
There is also no penalty for pre-payment. The Library District would be in a position to exercise their option to purchase when the whole cost of the lease is paid. The proposed lease includes $45,000 that recognizes the town’s capital expenditures during 2017 and 2018.
The issue arose after the library board had balked at the suggestion by the town earlier this summer to raise its rent, which would cost the district approximately $7,000 to $8,500 more per year. The initial response was that such an increase could force the district to cut hours at the Crested Butte location.
Crested Butte town manager Dara MacDonald explained at the time that the council policy was to get all the tenants renting town space under a lease. The library hasn’t had a lease with the Old Rock Schoolhouse building since 2012. “Lease rates were established at well below market pricing so as to help the community,” MacDonald said last June. “The town does need to recover some but not all of the costs to manage its building inventory.”
The council is hoping negotiations between staff and a few board representatives from each side can make positive headway in the near future.