Yeah, let’s give these guys more of our hard earned money
It is axiomatic that government wastes much of our hard-earned tax dollars. This fact is not controversial although it is frustrating. In Thurston County, Washington State, politicians and bureaucrats demonstrate (once again) this waste in just one real estate purchase. It is worth remembering this example when someone tells you that government is the solution to our problems.
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Thurston County purchased a manufacturing warehouse building in 1998, and proceeded to spend at least $8 million over the next 18 years devaluing the asset they acquired. The most imaginative fiction writer wouldn’t create a scenario like this and expect anyone to suspend disbelief enough to accept the story. Unfortunately, this is nonfiction, and it should remind us all why limited government is a noble objective, capable of creating freedom and financial dividends. In the meantime, this is Thurston County. Read it and weep.
In 1998, the Thurston County Commissioners chose to purchase an old commercial building located in one of the few industrial parks located in Thurston County – near the state capitol in the City of Olympia. The building was originally a fish processing facility, and the commissioner’s original grand plan was to convert the building (now called the 3400 Building) into a new county jail facility. The 3400 Building was purchased using bonding debt for $3.8 million using a dedicated sales tax revenue stream that was intended to be used only for public safety projects like a new jail. Good intentions paved the way.
Problems cropped up shortly after the county acquired the building when it was determined by then-County Sheriff Gary Edwards (now running for Thurston County Commissioner), that the building was completely inadequate for the needs of a new jail in Thurston County. It remains unclear why he was not consulted before the building purchase.
Government agencies, like the individuals who run them, are fallible. This saga, however, gets worse as the effort to justify the original purchase compounded the mistake. The elected commissioners, in coordination and with approval of the then-new County Manager Don Krupp (who has wisely left Thurston County for greener pastures as Clackamas County Manager, Oregon), spent hundreds of thousands of dollars on consultants and studies trying to understand how best to utilize this property. At one point they were approached by Shipwreck Beads and other private, tax-paying businesses interested in acquiring or renting the facility. The Thurston County Commissioners rejected every opportunity to cut their losses and ensure the building could at least start paying property taxes rather than cost the taxpayers more.
Instead, the decision was made to sink good money into an already bad investment. Thurston County dumped about $2.1 million into seismic upgrades and hundreds of thousands of dollars were spent on various remodel efforts over the years. During this time, the building was largely empty, unused by Thurston County.
Multiple efforts were made to convince various branches of county government to move into this building, but most local elected officials over a decade and a half realized it was not worth moving their employees, or their offices to this empty facility, even after the expensive remodeling expenditures. Finally, the sheriff’s office was convinced to use the large warehouse facility for some limited storage.
During the last 18 years, the taxpayers of Thurston County picked up the costs of power, lighting, landscape maintenance, and some heat for the building to prevent mold from growing inside the empty facility. Best estimates are that these costs alone equaled $900,000 for an empty building.
How to destroy a commercial building’s value by turning the parking lot into an expensive permanent homeless camp.
This 3400 Building was on a large commercial lot that came with the facility. This was a significant part of the property value for potential light manufacturing businesses that might consider using this building. However, much of this asset was gifted by Thurston County to the state’s most expensive homeless tent-shelter program called Camp Quixote. Camp Quixote (sometimes called Quixote Village) is a 30 micro-cabin project intended for use by approximately 30 homeless persons. It was built for about $200 per square foot, which is far more than your house costs. While Camp Quixote absorbed millions of tax-payer dollars ($3 million in grants as best I can research at this point), they only had to pay Thurston County $1 for occupation of the parking lot in perpetuity.
While I testified against this significant capital asset giveaway by Thurston County as a violation of the illegal gifting of public resources clause (article 8, section 7) in the Washington State Constitution, my concerns were rejected at the time by County Commissioners Sandra Romero, Karen Valenzuela, and Cathy Wolfe and county manager, Don Krupp. Manager Krupp pointed out an exception to this constitutional restriction if they gave the property to the destitute. By destitute, he was not referring to the grant recipients who live off the millions of dollars given to the camp, but by the people squeezed into its Home Depot-like shelters.
While a homeless encampment next door might add value in some Washington State communities, this appears to have the opposite impact on the 3400 Building which rapidly began to depreciate in value. This came as a complete surprise to the Thurston County Commissioners and their central planning department (euphemistically called “Resource Stewardship”).
Violating State Law by Illegal Diversion of Tax Dollars
While the empty 3400 Building was finishing the second decade of vacancy under Thurston County’s stewardship, concerned citizens were investigating Thurston County’s other big empty building (a brand new jail, which had only been sitting empty for five years). In the course of his citizen activism exploring the deep recesses of the Thurston County budget, citizen Jon Petit discovered that money was being illegally diverted from the sales detention tax fund (a fund which is legally required to ONLY be used for public safety purposes) to cover funding the money pit 3400 Building which had no relevance to public safety in any way.
To his credit, County Manager Don Krupp recognized the violation of state law, and set Thurston County up in a payment plan to reimburse the illegally diverted sales tax dollars back into the fund. Those public safety funds have still not been completely reimbursed after the original illegal diversion, but current Thurston County Manager Cliff Moore promises that someday those funds will be returned.
Selling a Shrinking Capital Asset – Cutting your losses, and Trust
The empty 3400 Building’s true market value is now $1.8 million. The Capital Assets Report lists this building’s value at near $6 million, which has little basis in reality. The county squandered that much and more hard earned taxpayer funds on the building, but the real world value is far less.
Sometimes it is best to cut your losses, and I support the recent move by Thurston County to sell this white elephant money pit before it drags our community further into pointless debt.
Some of this year’s newest voters were not born when Thurston County purchased this building. During the entirety of their lives, Thurston County was unable to make productive use of this empty building, and gave away half the property for a homeless encampment next door .
Yeah, we can trust our elected officials and bureaucrats, let’s give them even more of our money…
More articles about Thurston County for additional background: