After the city changed it plans for a downtown parking lot earlier this year and agreed not to sell the 78-lot along King Street near the Chattanooga Design and Resource Center, the city is finding there is a cost to keeping the lot.
During heavy rains, the surface lot has been blamed for flooding the basement of the nearby 6-story King Street storage building, which is owned by the same group that is building the Moxy hotel on the same block. Fixing the flooding problems will likely cost the city anywhere from $70,000 for a temporary solution up to $400,000 for a long-term fix, according to a report Monday to the Chattanooga Downtown Redevelopment Corp., (CDRC).
The CDRC, the city agency that owns and develops a number of downtown properties, initially decided last April to sell the city's King Street parking lot to the hotel developers — Hiren Desai and Jimmy White. But in January, the administration of Mayor Andy Berke changed its mind and decided not to sell the parking lot after coming under fire for such a sale by Accountability for Taxpayer Money (ACT).
Helen Burns Sharp, founder and head of ACT, charged last year that the city was preparing to accept a $134,700 offer from Desai and White for the parking lot even though the city paid $195,000 a decade earlier for the lot and other Southside properties have since steadily increased in value. The developers ultimately dropped their offer and the city decided against selling the property.
But the city will still have to make some changes on the site. During a CDRC board meeting Monday, Chattanooga's deputy director for economic and community development, Cherita Allen, said the city is going to have to fix the gravel parking area to control its water runoff.
"I don't think the water problem (in the King Street storage building) can be solved until the gravel parking lot is property graded and capped," said Chris Byerly with Chalzer Inc. General Contractors, which White hired to assess the flooding problem in his building.
The cost of flood control
Allen said one solution would be to simply build a ditch on the site to retain the water, but that estimated $30,000 fix would remove the 78 parking spaces and was deemed unacceptable by CDRC members.
An estimated $70,000 fix would change the grade of the lot but would be only a temporary fix, Allen said. The longer term fix, projected to cost up to $400,000, could require the city to spend more than $5,000 per parking space. But such an upgrade could open up the lot with a new security and gate system for rentals at night and weekends when city employees don't need the parking.
The city will study alternatives and come back with its recommendation to correct the flooding problem and allow the developers to lease their King Street storage building, Allen said.
Waiting on The Chattanoogan sale
The CDRC also is having to spend money at The Chattanoogan hotel and conference center after delays in reaching a negotiated sale for the property.
The city agency voted last October to sell the 199-room hotel and conference facility to the Kentucky-based Schulte Hospital Group for $32 million. But Daisy Madison, the chairman of the CDRC and finance director for the city of Chattanooga, said Monday no deal has yet been struck for the hotel sale and terms are still being negotiated.
In the meantime, the CDRC voted Monday to spend $22,173 to buy a replacement boiler for The Chattanoogan, which continues to be managed for the city by Benchmark Resort and Hotels.
Contact Dave Flessner at dflessner@timesfree press.com.