Town to sell bonds for American Legion property purchase, despite complaints from residents

The Chapel Hill Town Council unanimously voted to sell $4.3 million of the 2015 referendum bonds on Wednesday to complete the purchase of the American Legion property.

The property is located near Rams Plaza in East Chapel Hill. 

“I see this property as an amazing opportunity to have a park on this side of town that’s for everyone and that has all kinds of amenities — but we don’t know what those are yet,” said Chapel Hill Mayor Pam Hemminger. 

The town purchased the 36.2 acre American Legion property in 2017 for $7.9 million to be paid in three installments. The town paid $3.6 million at closing and will pay the next installment of $2.15 million next month. 

The town originally slated the bond funds being used for the American Legion property to go toward recreation facilities. Hemminger said the purchase of the property falls under the category because part of the land will ultimately become a park. 

Council members approved the sale of the park facilities bond as part of a larger bond sell-off totaling $12.5 million. The council also passed the sale of stormwater improvement and streets & sidewalk bonds. 

Some Chapel Hill residents expressed concern that the bond funds will not be going toward building new parks and recreation and cultural arts facilities. The Parks and Recreation Department will move to a new building in coming years, but cultural arts will not be included. 

“Our biggest concern is if we don’t have a cultural arts building to count on in a couple of years, we can stay (at the current facility), but we don’t know how soon the town will want that (land the current facility is on),” Community Clay Studio manager Carmen Elliott said. “We would love to ask you: please, please put the cultural arts building as one of your top priorities in the next few years,” 

Hemminger said the bond fund payment of the property will not stop the building of a new cultural arts facility. 

“We are still committed to the original agreed-upon cultural arts and parks and rec. things that were voted upon by the voters, but timing-wise, we don’t have any projects immediately for those,” said Hemminger. “Using the bond money is a better interest rate for the town in general.” 

Ken Pennoyer, town director of business management, advised the council to borrow all $4.3 million now because the town does not plan on issuing General Obligation bonds in the 2019 fiscal year. He also said paying for the land via bond funds will offer a better interest rate. 

American Legion Post 6 currently rents their building on the land and will continue to do so until they purchase their new property.

While the town will not use the property until it is entirely paid off, Hemminger said town staff will propose a recommended layout of the property and its future uses in May or June, which will include plans to sell part of the property to help pay for the land. 

The town will look into investigating the size and location of a pond on the American Legion property as the town makes potential plans for the land, Hemminger said. 

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