Ball State's Board of Trustees authorized a plan Wednesday that will set the wheels of eminent domain in motion.
The building that currently houses Hiatt Printing is wanted for the McKinley Commons project, a combined hotel, convention center and residence hall. The university has looked at offering a space in the new facility to the trust in charge of the printing business.
Randy Howard, vice president for business affairs and treasurer, said he does not think the university can offer more money than the $400,000 proposed in April.
The university is in "good faith negotiations" with the property owner of the proposed site, Howard said.
Hiatt, however, disputes this claim.
"There was a lot [that was incorrect]," he said.
In a May 14 email obtained through public records requests, Hiatt acknowledges the $400,000 offer made in April, but the Daily News has not received indication of more contact between the university and Hiatt.
"Despite what the BSU has inferred to the media or their Board Members regarding negotiations with the property owners, absolutely nothing has been offered to Hiatt Printing that doesn't render it worthless and assures its ultimate demise," Hiatt said in a statement sent to the Daily News and other media organizations.
Hiatt did not speak up when the board offered the opportunity for the audience to speak. Mediation with Hiatt is scheduled for mid-October.
Hiatt said the trust "strongly disagree[s] with Ball State's assessment that they can successfully meet the 'public use threshold' in this proposed project," a requirement for the use of eminent domain.
According to the Fifth Amendment to the U.S. Constitution, no private property shall "be taken for public use, without just compensation."
Other requirements exist in Indiana, such as a good faith negotiation with the owner, a proposed purchase price and providing the owner with an appraisal or other evidence used to establish the proposed purchase price.
When asked why Ball State didn't just choose another location, President of the Board of Trustees Hollis Hughes said: "You're a student at Ball State, you find me a location that's close to the center of campus, that has that much available land, that we own all of it, except this one little piece of land. We're not clearing out a bunch of land, this isn't the next step in a next action or a chain reaction of eminent domain. We own everything except this one piece."
Hiatt Printing's location was chosen for multiple reasons, said Howard, including its location next to the McKinley Avenue parking garage, to save on parking facility costs. It is also in close proximity to the L.A. Pittenger Student Center, Applied Technology Building and the Village. Being close to the Student Center would enable guests to use more rooms during conferences, Howard explained.
Hughes said the project would help make the Village better.
"It will attract a whole new clientele coming in for conferences," he said. "People that are staying in residence there that will be looking for places to go out and eat, things to do, places to shop. We think it will create some new opportunities that don't currently exist."
In a comment on the Daily News website, Hiatt voiced concerns for the university over the entire situation, and announced his talks with lawyers in response to Ball State.
"Quite honestly, this could be a serious 'crap-shoot' for Ball State. If they lose in this attempted seizure, it will doom the power of condemnation for every other state-subsidized university in Indiana. Even if they win, they lose, because the [collateral] effect of their business-owner benefactors," he wrote. "Because of Ball State's threat of condemnation, Hiatt Printing has subsequently engaged legal counsel who will be responding to both Ball State University and the media in the very near future regarding any ongoing legal issues."
Hughes shot down concerns that the university would take over more property in the Village district.
"What's the advantage to the university to take over the Village?" Hughes said. "We don't run bars. We aren't interested in taking over the Village. We want them to flourish."
McKinley Commons would add 51 student housing units and 112 guest rooms. In addition, two restaurants and 7,000 square feet of meeting space would also be in the facility.
The hotel could be used to house visiting athletic teams or guests on "official business," such as those interviewing for a position at Ball State. Currently, the university pays for their accommodations at other hotels.
According to Financial Pro Forma, project revenue would exceed expenses, even in the first year. After expenses, the first-year revenue would result in $38,400 in free cash flow, according to current projections.
Howard also said the payroll for McKinley Commons employees would be around $2 million a year, which makes up almost two-thirds of the $2.99 million operating expenses for year one.
McKinley Commons is anticipated to open in Summer or Fall 2014.
That timeline could be derailed, though, if the owners of the Hiatt property decide to pursue legal action. The university is hoping this doesn't happen, according to lawyer Jim Williams, the university's outside counsel on the issue.
"There is still time for amicable discussions," he said.
In addition to McKinley Commons, President Jo Ann Gora discussed current numbers at Ball State.
Gora said Ball State enrolled 3,622 new freshmen this year. Of the newly enrolled students, 14.3 percent were of an underrepresented ethnicity, which is up from 8.6 percent five years ago.
Although many students enroll in on-campus classes, there are 3,756 students, or 21 percent, taking online classes.
Gora also mentioned the recent controversy with Chick-fil-A.
"We will continue to keep an eye on the situation," she said.
The board discussed Studebaker East and its current status. Renovation is nearly complete with landscape being done. Crews are still working on showers for Americans with Disabilities Act accessibility.
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