- Associated Press - Tuesday, March 11, 2014

RALEIGH, N.C. (AP) - Negotiations between officials from the state and the city of Raleigh have begun again regarding the future of the Dorothea Dix Hospital campus.

Former Democratic Gov. Beverly Perdue signed a $68 million, 75-year lease with Raleigh officials before she left office. In 2013, Republican senators demanded the deal be scrapped. The Senate voted to dissolve the city’s lease immediately, saying it didn’t represent the property’s fair-market value and failed to protect health services as the property was originally intended.

City officials threatened to sue if the lease was voided.

By the end of last year’s legislative session, McCrory and House leaders worked out a “standstill” agreement under which the city would hold off on enforcing provisions of the Perdue lease while a new deal was worked out.

“We’ve just started talking,” said Bill Peaslee, general counsel for the Department of Administration, which is leading negotiations on behalf of McCrory.

City leaders and volunteers have been pushing for years to use the 325-acre Dix campus as a central park. But they have been unable to reach a permanent deal with state leaders.

The site is named for Dix, an early mental health advocate who was instrumental in launching institutions in the 19th century, including the now-shuttered hospital on the property named for her. It has been there for 150 years.

The last patients left Dorothea Dix hospital in August 2012, but the Department of Health and Human Services headquarters and many administrative divisions are still located on the property.

Peaslee said the state still hopes to use part of the property for DHHS headquarters. The city needs to determine how much of the property it actually needs, he said.

City attorney Thomas McCormick told WRAL in Raleigh that the city wants the entire site. He would not comment on whether the city would accept any deal that left some of the property in the hands of the state.

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