Sunday, October 2, 2022

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Commissioners sign off on contract to lease proposed facility for new ‘diversion center’

Alamance County’s commissioners have approved a multi-million-dollar deal for a facility that will provide mental health services to people who may otherwise languish in jail for minor offenses.

During a regularly-scheduled meeting on Tuesday, the commissioners signed off on an agreement to establish this “diversion center” in a facility that a local developer currently has under construction near the grounds of Alamance Regional Medical Center.

This two-building complex will ultimately replace a rudimentary diversion center that already operates out of a leased building near Burlington’s Holly Hill Mall. The new facility, which is expected to be ready by November of 2023, will expand the existing center’s offerings to include separate facilities for juveniles and adults, an in-house pharmacy, and a 16-bed wing where drug addicts and others can remain for extended periods of time.

The agreement that the commissioners adopted on Tuesday allows the county to entrust the operations of the new center to Vaya Health, a regional consortium that administers publicly-funded mental health services for several counties. Under the newly-approved deal, Alamance County would give Vaya roughly $1.4 million a year to lease the facility from its developer – with an option to purchase the property for an additional $12 million after a period of 25 months.

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Six years in the making
The approval of this agreement is merely the latest step in the county’s six-year odyssey to find a better way to deal with drug addicts and mentally-ill individuals who get into trouble with the law.

A priority for Alamance County’s sheriff Terry Johnson, this so-called Stepping Up initiative eventually led to the creation of an incipient diversion program, which presently operates out of a leased building near Holly Hill Mall that also houses a county-funded mental health crisis center.

Financial considerations initially limited the county’s ability to expand these existing services. That all changed, however, when Congress passed the American Rescue Plan in 2021 – and left the county with some $32.9 million to use for various purposes, including the provision of mental healthcare.

In the wake of the American Rescue Plan, the county was approached by local developer Chad Porterfield about a project that he had in the works at 971 Kirkpatrick Road. Porterfield touted this site, which is situated near ARMC, as an ideal location for a new, multi-million-dollar diversion facility.

Although the commissioners initially balked at Porterfield’s offer, they nevertheless set up a steering committee to explore the idea. This committee eventually returned to the commissioners in late March with a recommendation that they move forward with a 28,000-square-foot facility on the same site that Porterfield had pitched to the county.

Rather than simply approve the committee’s recommendation, the commissioners invited Porterfield and other developers to submit formal proposals for a new county facility that would meet the same basic criteria that the steering committee had proposed. This “request for proposals” has apparently paved the way for the lease-to-own agreement that the commissioners ultimately accepted on Tuesday.

 

Going with Vaya
During that morning’s meeting, Alamance County’s deputy manager Sherry Hook went over the terms of the proposed contract with Vaya that would allow the consortium to lease Porterfield’s facility on the county’s behalf.

Alamance County deputy manager Sherry Hook

Under this deal, the county would provide Vaya with $500,000 for the diversion center’s startup expenses as well as additional funds to cover the facility’s lease for up to 10 years – with the aforementioned option to buy after 25 months. The contract goes on to predict an initial cost of $1,396,080 a year for the lease payment with a 3 percent increase in every subsequent year.

In order to cover the facility’s lease payments, Hook said that the commissioners can draw on a $1.2 million nest egg from Vaya’s predecessor, Cardinal Innovations. They can also tap into a state-level grant for $500,000 – $250,000 in unspent revenue that the county has previously handed over to Vaya, and Alamance County’s share of a national opioid settlement, which is expected to be worth $8.8 million over 18 years.

“There is funding here to cover the lease for seven to eight years without any additional contributions from the county,” Hook went on to add, “and if you were to purchase it, it would free up your future opioid settlement money for the future.”

 

Federal funds to the rescue
Earlier that morning, Alamance County’s manager Heidi York had mentioned the county’s potential acquisition of this facility when she briefed the commissioners on the county’s share of the funds distributed under the American Rescue Plan.

During her presentation, York encouraged the commissioners to purchase Porterfield’s facility using $12 million of the $13.2 million that the county still has of its initial federal largesse. This proposal would require the county to lease the property for 25 months before it takes over the title, although a representative of Vaya told the commissioners that they could theoretically buy the facility when it’s complete for a sum of $15 million.

The commissioners took no action on Tuesday regarding York’s recommendation to purchase the property with federal funds. Nor did they act on another proposal to use the remaining $1 million of the Rescue Plan’s proceeds to offset the cost of a proposed EMS substation near Mebane.

Even so, the commissioners were eager to move forward with the proposed agreement with Vaya, which they ultimately approved by a margin of 4-to-0.

“This discussion cannot go on as long as the stepping up initiative has gone on,” commissioner Pam Thompson said before Tuesday’s vote. “This has gone on years – years, I

County commissioner Pam Thompson

tell you…We’ve got to get serious on this.” John Paisley, Jr., the chairman of Alamance County’s commissioners, was absent on Tuesday due to illness, according to vice chairman Steve Carter who presided over the meeting.

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