Bid accepted, ‘upset’ begins

The county has accepted an offer from Matthews Drug Store to purchase the former Emergency Services headquarters property on Underwood Street, initiating an upset bid process that will allow for that offer to be outbid in what could be an ongoing auction-style procedure. The county attorney said he would be surprised if the initial offer was not outbid, and said the procedure could allow the market to dictate the value of the property.

The county received an offer to purchase the property located at 107 Underwood St. in the amount of $25,000 from Pharming Company, LLC dba Matthews Drug Store. After a brief discussion at its monthly meeting this week, the Sampson County Board of Commissioners unanimously authorized the sale of the property, initiating that upset bid process.

“You have already recorded the survey that will subdivide the property, so the portion being purchased is 1.992 acres and that is subject to an about 2.6-acre easement over the property,” County attorney Joel Starling said leading up to the board’s decision this week. “The county is retaining the Veterans Memorial portion of the property, which is about .27 acres.”

Starling said the board did not have to accept the offer, and could reject it if the board felt that bid was “not adequate” for the property.

Even if the board chose to accept the offer, and did not get an upset bid in the 10 days that followed, it would still have the option to reject the offer in the end as a final confirmation is required once the 10 days elapses.

In accordance with N.C. General Statute, a notice of the proposed sale must be published describing the property and the amount of the offer, and also stating the terms under which the offer may be upset. As part of the upset bid process, the offeror would be required to deposit 5% of the bid amount with the board clerk, who would then publish an advertisement for eligible upset bids — which would have to equal 10% of the first $1,000 of the original offer and 5% of the remainder and be received within 10 days after the date of the advertisement and be accompanied by a bid bond or deposit.

In this case, the minimum amount needed to upset that bid would be $26,300. If qualified upset bids are received, the upset bid process would be repeated until no additional qualifying upset bid are received.

“I do not have a crystal ball,” said Starling, “but I would be surprised if this offer does not get upset during the upset bid process.”

Once the bid is accepted and advertised, others will have a 10-day period to submit bids over the top of that high bid.

“That continues on along as we continue to receive qualifying upset bid offers.”

Commissioner Sue Lee asked whether the county had a tax value for the property.

“We do,” Starling replied. “I would encourage you not to get to tethered to that at this point. I think — again, I do not have a crystal ball — that this process could start allowing the market conditions to set that number. Or, as I said, the board could reject this offer if you feel like it’s not a qualifying offer.”

In January, commissioners directed staff to resume informally soliciting and negotiating offers on the Underwood Street property, to exclude the portion that includes the Sampson County Veterans Park, which county leaders have assured will stay where it is.

The board previously expressed its interest in divesting itself of any ownership interest in and financial responsibility for the old Emergency Services building while maintaining the memorial at its current footprint off U.S. 701 Business and Underwood Street.

The issue of disposing of the property was first broached at the end of 2022 and, throughout 2023, local veterans pleaded with county leaders to preserve the veterans memorial at the edge of the site. Commissioners subsequently said the park wasn’t going anywhere, but it was a matter of how to proceed and subdivide the property.

Gauging interest in the Emergency Services property was part of a larger endeavor to identify potential new sources of revenue for Sampson County government, but also broached as County Manager Ed Causey said concerns were raised that it might be in the best interest of county leaders to be free of the old building once not in use. A full move to a new $18 million Emergency Services headquarters across town was completed last year, leaving the facility officially vacant in the fall.

Years ago, emergency officials noted the old armory building was “in dire need” of replacement, citing the aging facility, limited space and flooding issues at the facility on Underwood Street, which was constructed in 1956.

While the idea for a new facility was tossed around for years, emergency officials said the building had become too small and was susceptible to flooding during even moderate rains. The facility served as a North Carolina National Guard Armory until it was released to the county in 1995. There was a general lack of space for staff, equipment and storage, as well as ventilation issues.

The board has expressed its hope to have conveyed the portion of the property where the old Emergency Services building is located to an end-purchaser by July 1, 2024.