County board approves lease change for OCCOA building, storage facility bid

Paul Welitzkin, The Petoskey News-Review
·3 min read
The Otsego County Board of Commissioners approved a lease with Otsego Signet LLC for this building at 1165 Elkview Dr. in Gaylord for the Otsego County Commission on Aging (OCCOA). The agreement calls for OCCOA to pay $14,000 a month or a total of $4.5 million for 25 years. At the end of the lease, the county will  assume ownership of the 18,000 square foot building. Signet will also pay for building renovations to accommodate OCCOA's needs.

GAYLORD — Buildings took center stage at Tuesday's meeting of the Otsego County Board of Commissioners.

Commissioners were considering amending a lease for a building that will house the Otsego County Commission on Aging (OCCOA) and a bid for the construction of an equipment shelter for the county's animal control operations.

Last summer, the county board approved an agreement with Otsego Signet LLC on a 25-year lease on a building located at 1165 Elkview Dr. in Gaylord that will house OCCOA and its programs and services.

The county board, with only Henry Mason of District II dissenting, approved an amended version of the lease which will run 20 years with an option for a five-year extension.

The agreement calls for OCCOA to pay $14,000 a month or a total of $4.5 million for 25 years. At the end of the lease, the county will assume ownership of the 18,000 square foot building. Signet will also pay for building renovations to accommodate OCCOA's needs.

At least 15 residents carrying red signs opposing the lease were not pleased with the arrangement.

"You've got a building that recently sold for $1.1 million that the county is now entering into a $4.5 million lease agreement. It looks like this was kind of a done deal prior to the purchase of the building," said Stephanie Jacobson, one of those opposed to the lease arrangement.

The Gaylord Herald Times was not able to independently confirm the sale price of the building or when it was sold.

"The (OCCOA) board has looked at all of the things that OCCOA is doing for seniors and has determined that they need more space. They have done their due diligence and they believe that this is the best alternative. The lease agreement interest is lower than a commercial purchase interest rate," said county board chairman Ken Glasser.

Brett Bowman, a bank official who serves on the OCCOA board, added that "It means that the payments are predictable and they are finite and locked in."

"Agencies that serve the public are always challenged to repurpose existing buildings rather than building new; we are always challenged to work within our means rather than increasing tax rates whenever possible. That’s exactly what the Otsego County Commission on Aging has accomplished. The OCCOA will not be proposing a tax increase — they are not even allowed to, as they are capped statutorily. This project is the result of careful planning, budget diligence, and impactful utilization of COVID funding," said county administrator Rachel Frisch.

In addition to future growth, the OCCOA also wants to consolidate most of its offices and programs in one location.

"The senior population in Northern Michigan is growing rapidly and (OCCOA) is trying to address that," said Glasser. "They have gone through a two year project and done due diligence and they believe that this is the best alternative."

Those opposed to the county commission on aging building were also questioning the need for a storage building for animal control. County commissioners, again with Mason dissenting, also approved a bid of nearly $128,000 for that building.

"They have a need for a building to store equipment that is currently stored outside," said Glasser. "We were lucky with the last wind storm that we didn't have any severe damage. We have an obligation to protect the equipment we bought with taxpayer money and that is what we are doing."

In other matters, Tim Cherwinski, director of the Otsego County Bus System, said ridership still hasn't recovered to pre COVID-19 levels.

For last fiscal year ending Sept. 30, 2021, the system took care of 31,900 passengers. In the year before, which included pandemic-related lockdowns, the system had 36,270 passengers and in the year ending in 2019 before the virus, total passengers were over 60,000, said Cherwinski.

At one point in 2020, Cherwinski said the system had to lay off three quarters of its drivers and almost all have been called back.

This article originally appeared on The Petoskey News-Review: County board approves lease change for OCCOA building, storage facility bid