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MEMORANDUM — Correctional Institute January 2, 2013 Page 2 Since expressing its initial interest in purchasing the Correctional Institution property, staff has been advised that a long term lease of the property is permitted under administrative rule. The term of this lease would be for 50 years at lease rate of $300 per year. If the Board were to enter into a lease agreement for the property, a host of restrictions on the use of the property would arise. Administrative rules would require: • Public bid for any proposed tenants other than the County • Fair Market value rental terms • Proposed uses by the tenants similar to past uses • State approval of tenants and proposed uses • Prior approval of any alteration to existing buildings or improvements • preparation of a site specific operational report or management plan • a description of management needs of the property • a description of the management responsibilities of each lessee of the property • a statement of gross income generated, net income and expenses While a long term lease may be financially beneficial to the County, the restrictions imposed may make it difficult to find tenants willing to be subjected to these requirements. When discussing the possibility of a lease with representative of the Division of State Lands, it has been made clear that this site is offered for sale, not for .... lease and the only way to move forward with County acquisition of the property is through the appraisal method. Since the last time the Board discussed this matter in August, 2012, Indian River Charter School has expressed interest in using the property as a tenant of the County to possibly utilize the correction facilities for vocational programs such as food service or automobile repair. There is an existing gun range on the property and the Sheriff has expressed the Department's interest in utilizing this improvement. Funding: Funding for any appraisal would be transferred by a budget amendment from General Fund/Reserve for Contingency to General Fund/BCC/Other Professional Services —Acct #00110111-033190 Recommendation: Staff recommends the Board discuss whether it desires to proceed with purchase of the Correctional Institute property by hiring the appraiser and direct staff accordingly. Staff further recommends joint cooperation between the Sheriff's Department and the Charter High School to apportion responsibilities for maintenance and utilities should purchase of the facility become a reality. 133