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Fort Smith agrees to buy 623 Garrison Avenue for $4 million; board approves outright purchase pending due diligence
Summary
After public comment and financial review, the board amended a financing resolution and authorized purchase of 623 Garrison Avenue using unobligated 2025 general fund balance, with final approval contingent on completion of due diligence.
The Fort Smith Board of Directors on Jan. 7 amended a financing resolution and directed staff to purchase 623 Garrison Avenue for $4,000,000 using unobligated general fund balance, with final approval to follow completion of a 30‑day due diligence period.
Staff introduced the financing options, noting a proposed 20‑year financing plan backed by a dedicated portion of franchise fees would incur about $2,800,000 in interest. During public comment, Kim Fodge and Dan Williams urged the board to buy the building outright to avoid interest costs.
Director Kevin Sutton moved to amend the resolution to purchase the building outright from unobligated general fund balance; Director Neil Martin seconded. The board discussed due diligence scope. Staff clarified the due diligence would include a building inspection (including mold/asbestos) and other standard real estate reviews; remediation and repairs would influence final terms and any adjustments to the purchase.
Finance Director Andy Richards reported the general fund balance was approximately $24–25 million at year-end projections and estimated a projected 2025 year-end fund balance of about $18 million after budgeted adjustments. Richards noted the city would save approximately $2.8 million in interest by paying cash and that buyout would eliminate roughly $350,000 per year in rent expense.
The board amended the motion to purchase outright with $4,000,000 drawn from the unobligated 2025 general fund balance and to return to the board for final approval after due diligence. The amendment and the resolution as amended were approved on roll call 7–0.
Why it matters: Purchasing the building outright would avoid multi‑year interest costs and reduce annual rent expenses, but it reduces the city’s cash reserves; staff will complete due diligence and present any findings before final closing.
Actions: Motion to amend financing terms and direct purchase with unobligated funds — approved 7–0. Final purchase approval contingent on successful due diligence.
