Helena, Lewis & Clark County to consider buying all, not half, of former BCBS building

Posted at 9:35 PM, Oct 31, 2018
and last updated 2018-11-01 00:11:22-04

HELENA – Helena and Lewis and Clark County staff are now recommending that the city and county buy all of a former Blue Cross and Blue Shield property in downtown Helena.

The city and county commissions have already agreed to lease, then purchase part of the property on Fuller Avenue. It will serve as the Law and Justice Center, a new home for the Helena Police Department and Lewis and Clark County Sheriff’s Department. The agencies have to move out of their current offices in the Law Enforcement Center so that building can be converted into an expanded detention center.

But Roger Baltz, the county’s chief administrative officer, said staff members now believe there could be more benefits to purchasing the rest of the Fuller Avenue property.

“The recommendation that we’re coming forward with is based upon that analysis, taking a look at a cost analysis and what’s the most efficient thing to do,” he said.

A 2017 appraisal set the price for the entire Fuller Avenue property at $1.95 million. It includes two adjoining sections of a large building – a 25,000-square-foot section built in the 1920s and known as the “Pillar Building,” and a 40,000-square-foot section built in the 1970s and 1980s and known as 406 Fuller Avenue.

Earlier this year, the city and county reached a “lease-buy agreement” for 406 Fuller Avenue and its parking lot. The price for that part of the property was $1.29 million. The governments began making monthly lease payments of $12,500, applied to the eventual sale price, and took possession of that section of the building.

The original plan was to divide the property into two parts. However, leaders discovered that, if they did that, city codes would require them to install a “three-hour firewall” – intended to keep a fire from spreading for three hours – between the two sections of the building. Baltz estimated that would cost between $250,000 and $350,000, which he said wouldn’t be cost-efficient.

“We need to react to that, and we need to make smart decisions now that that information is clear to all of us,” he said.

Baltz said staff looked at avoiding the firewall requirement by either sharing ownership of the Pillar Building with the current owners or buying it outright. He said they concluded the best option was to purchase the entire Fuller Avenue property.

“I think there’s arguments to be made about commitment to the downtown area, long-term strategic planning that opens up other opportunities for both the city and the county if we own the entire property in the downtown area,” he said.

Baltz said he didn’t expect the city and county will immediately renovate the Pillar Building if they purchase it. He said the building would likely be used initially for storage.

In the future, Baltz said they might also look at leasing space in the building or converting the 42 additional parking spots into paid parking. The proceeds from those changes could then go toward maintenance costs for the building.

“We’re budget-driven, and we want to be very responsible with the dollars that we do have, that our citizens have authorized for us to use for these types of projects,” he said. “If we can use these properties to generate additional revenues, we’re going to try to be very aggressive about doing that.”

The Helena City Commission and Lewis and Clark County Commission must approve an adjustment to the lease-buy agreement before the city and county can purchase the whole property. Baltz said the county commission could consider the proposal in the next few weeks. According to an informational packet for a city commission administrative meeting, the proposal could come up at their meeting on Dec. 3.

No matter what happens with the Pillar Building, it won’t affect the current plans for 406 Fuller Avenue. Helena’s Building Division has approved the city and county’s proposal to renovate the building. Leaders say they need to bring the building into compliance with city codes, improve accessibility for people with disabilities and create a secure evidence storage area before HPD and LCSO can move in.

Baltz said renovation work is expected to begin on Monday, and could last six to eight weeks. After that, he said it could be another three to four weeks to move the police and sheriff’s offices in.

“We’re going to do it as quickly as possible, but also with care and quality,” he said.