City of TD Ain't Selling; Garbage Rates increase 3%

By Tom Peterson

Did you know the City of The Dalles owns the State Building at 700 Union Street?

You know, the one with the Oregon Employment Department and Department of Human Services. You have probably parked there on parade day.

Here comes the commercial. 

It’s a 23,000-square-foot building sitting on 2.25 acres near the heart of downtown with a large parking lot, and it was recently appraised for real market value at $4.8 million. It was built in 1977 and is in good physical condition, according to City Attorney Jonathan Kara. 

Want to talk rent?

Try $34,815 a month plus cost of all capital improvements.

That is what the State - Department of Administrative services - is currently paying. 

“It is an income-producing asset for the City,” said The Dalles Mayor Rich Mays. “It’s good to get that every month.”

However, last summer the State told the City it was no longer willing to pay for capital improvements to the building because it created too much volatility in their budgeting - hard to plan for a major repair such as heating and air condition -  and they entertained buying the building.

In no uncertain terms, The State wants to retain the offices, whether through the city or some new owner, according to staff.  

City Attorney Jonathan Kara ordered the commercial appraisal on the building for $4,200.

But the state decided not to buy, but the word was out that the property might possibly be for sale. Apparently, DAS spilled the beans, according to Kara. 

Rubicon Investments, a real estate investment company based in Medford, which leases multiple buildings to the State of Oregon even showed up on Monday to make their interest known. 

On Monday, Jan. 10, City Council discussed the sale. 

They’re not selling. 

Rather, Kara has been assigned to negotiate a new lease with The State and return to Council for additional discussion. He will also investigate whether the property would be returned to the tax rolls if purchased by a private company and what that tax amount would be. 

Essentially, City Councilors want to retain the building but not lose money on it either. 

It will all come down to how much the State is willing to increase rent in exchange for no longer having to pay for building improvements.

Minimally, The City would have to create a reserve of money from an increased rent to pay for building improvements over time. Currently, they send the bills for building improvements to the State. 

Councilor Rod Runyon called the building an “ace in the hole” as it could be used either temporarily or permanently for City Hall offices in the near or distant future.

“It’s going to increase in value,” added Darcy Long. “It’s a long-term asset, noting she was looking at the next 50 to 100-years.

“I don't see any real impetus to sell,” said Councilor Dan Richardson. “It’s an irreplaceable asset.”

Garbage Rate Increase - 3 Percent

Councilors received additional profit and loss information from The Dalles Disposal before making a decision on granting a rate increase on Monday night. 

The company was asking for a 5.05 % rate increase to the company for local services.

Councilor Long said the 2021 gross profit margin for the company stood at 38.5% which was more than double the 17 percent margin from 2020. 

She motioned to give the franchise a 3% increase and Councilor Scott Randall seconded it. 

In a split vote, the motion passed. Randall, Long and Richardson voted in favor. Runyon and Councilor Tim McGlothlin were opposed. 

With the rate hike, a local resident with a 32-gallon garbage can would see an increase from $18.80 to $19.36 per month - a 56 cent increase.