Three years and about $1 million later, The Hub sits empty

March 04, 2004|LIZ MAPLES and JOHN NELSON

In February 2001, the city of Danville cut Third Street Development Corp. a check. The money, taken from a $975,000 state grant, had been given to the city for the purpose of revitalizing the Hub-Gilcher buildings, filling them with activity again.

The state placed no conditions on the deal regarding how the property should be developed, who should develop it or how long there was to do the job. There was little more in the contract than a date by which the money had to be spent. The Kentucky Commerce Cabinet oversaw the grant as far as the purchase of the building, and said recently it is through with any oversight.

Three years have gone by. The Hub still sits empty, undeveloped.

It has been nine years since the once-popular department store shut its doors.

TSDC President Janet Hamner says the fact that the buildings are still empty is not surprising. "We knew that it would take a long time," she said. "We knew that sometimes it was going to be take one step forward and two steps back - that's the way it's been."


Identified on several occasions in community meetings in the late '90s as the economic problem that most needed solving, filling the buildings became a priority of downtown planners.

Then a legislator, current Mayor John W.D. Bowling secured the state grant, first offering the money to Boyle County. Magistrates said no thanks, but Danville, under the leadership then of mayor Alex Stevens, accepted the money and passed it along to TSDC - unconditionally. The city has no written agreement that requires TSDC to do anything in exchange for the money.

Even the city's attorney, Ed Hays, wrote recently that the corporation owes the city no explanation of its activities. In a 2003 letter to the state attorney general, arguing that TSDC was not a public agency, Hays wrote, "The Danville City Commission is privy only to such activities of TSDC as the corporation sees fit to divulge."

The corporation used all of the money to buy the building, then set out to fill the space.

Potential tenants have come and gone, most of their identities still a secret. Eastern Kentucky University is the only prospect ever acknowledged, but it backed out of the negotiations, citing parking as the main problem.

The corporation today has one large potential tenant it can't name, said Hamner.

Bowling, who says he never imagined that the money would be handed over to a private agency with no strings attached, is now trying to tie some strings around a parking garage which TSDC says is necessary that the city build before its mystery tenant will commit. Late last year, TSDC sought a guarantee from the city.

The public was told that without a parking garage the building would likely remain empty, that no business would lease the space without places for its employees and patrons to park. The number of spaces that necessitate a garage is dictated by the city's own planning and zoning regulations, TSDC said.

Bowling wants three things

The city passed a resolution to issue more than $2 million in bonds for the garage, once a federal grant was secured, but included other conditions at Bowling's behest. Bowling wants three things, and he had the votes on City Commission last fall to demand them:

1. A commitment from a prospective tenant that if a garage is built, it will come;

2. A commitment from TSDC to cover the garage's projected losses in early years of operation; and

3. First option for the city if the Hub-Gilcher buildings are ever up for sale.

He even suggested at one point that the city itself might be interested in occupying part of the complex, but that idea has been abandoned.

Hamner has said that at least one of those demands is impossible to meet.

There has been no movement, publicly, from either party since the conditions were offered.

The federal budget was passed with the $1.75 million grant included. Hamner said that they now wait for President Bush to sign the federal budget.

The city hasn't received any lease agreements. Third Street hasn't publicly announced that it has any tenants. The building sits empty.

So far, nearly $1 million in tax money has been sunk into plans for a parking garage. In 1998, commissioners spent $315,000 for the lot behind the Hub, and then in 2003 commissioners bought the Heritage Community Bank's drive-thru for $250,000. A consultant was hired for $330,300 to design the garage.

There has been little noticeable activity in the huge building at Main and Third Street. There was a public meeting to promote the need for a parking garage, there are regular window rentals, and three juveniles were found hiding under a desk and accused of throwing light bulbs at passing cars.

TSDC meetings are not open to the public, and meetings with the Danville City Commission have been held in executive session to protect the identity of potential tenants.

Responding to Open Records requests from The Advocate-Messenger, and a Kentucky Attorney General's opinion that the organization had to comply with the requests, Hamner presented copies of canceled checks and a financial statement to the newspaper for 2001.

Third Street bought the building in 2001 for $960,000. That was $325,000 more than its appraised value. The balance of the grant and the interest it earned while in the city's possession, about $21,000, has been spent on attorney's fees, utilities and office supplies.

Hamner has said that any money Third Street received after 2001 is not public money, and so it need not account for how it was spent.

There is no other public record of the corporation's activities.

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