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McHenry County Mental Health Board grapples with building expansion

Published: Saturday, Aug. 9, 2014 11:24 p.m. CDT • Updated: Sunday, Aug. 10, 2014 1:21 p.m. CDT
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(Sarah Nader)
Sarah Nader- snader@shawmedia.com McHenry County Mental Health Board

A new and improved McHenry County Mental Health Board is doing its best to take it in a more fiscally responsible direction.

But dealing with one legacy from the old board – a half-empty, 22,000-square-foot expansion that taxpayers are still paying off – is proving to be tricky.

The expansion, actually a separate building, sits behind the Mental Health Board’s headquarters in Crystal Lake. Former board members built it anticipating future growth that never took place, and their successors are, at the very least, discussing whether it can be utilized in a manner that helps defray the cost.

However, the fact that it’s a public building financed through a unique federal bond program places limits on what can be done. The building is one of the many issues interim Executive Director Lyn Orphal has on her plate in steering the board to a better future after a tumultuous year of change that critics said was much needed and long overdue.

“There are so many different nuances that are popping up as we work to find out what is allowable,” Orphal said. “It can open up a whole big can of worms if we think we can do something only to find out that we can’t.”

And for the time being, the conventional wisdom seems to be that the list of things they can’t do with the building is a much longer list.

The Mental Health Board in 2009 made a pitch for the expansion, arguing it ran out of space at its 8,000-square-foot headquarters. It would fund the project with $4 million in federal bonding authority granted to the McHenry County Board as a means to stimulate the economy and get people back to work in the midst of the Great Recession.

Three million dollars was used to build the new building and renovate parts of the original one, with the remaining $1 million covering planning and architecture costs.

The County Board approved the bond issuance in 2010 over the objections of a minority that questioned expanding government while taxpayers were hurting.

A number of the client agencies that the Mental Health Board funds also questioned the need. Some pointed to the expansion as proof to their allegations that the board had far exceeded its primary mission to distribute tax money to agencies working with the mentally and developmentally disabled. They also alleged that the money to pay back the bonds would do more good given to them, especially in a state that has chronically underfunded social service agencies.

Time would justify the concerns.

The same Great Recession that created the funding mechanism shrank property values, and, therefore, shrank the Mental Health Board’s revenues, 96 percent of which come from local property taxes. Its staff has shrunk from 50 full-time equivalents at the time of the building’s construction to about 14 today.

And if property tax revenues continue to fall, the amount spent each year paying back the loan will become a bigger financial hit as the board finds fewer and fewer things to cut. The Mental Health Board paid $474,386 last year in debt service and occupancy expenses, according to its annual report.

A set of complicated restrictions attached to the federal bonds to make them lucrative to bondholders during an economic downturn could make the building a white elephant for the board.

It can lease space only to fellow government agencies, not private interests. And the hurdles that would be involved in selling the building could likely negate any cost savings in doing so, at least for a number of years.

The legal opinion on what can and can’t be done continues to evolve, said McHenry County Board member Paula Yensen, D-Lake in the Hills. Yensen holds the County Board’s voting seat on the nine-member Mental Health Board.

“There still isn’t a consensus about what we can do with the building because we receive differing opinions ... it seems like every time we are ready to move forward, there’s a new wrinkle,” Yensen said.

But the board has made some progress. It discovered that it can charge occupancy fees to the four mental health agencies that have space in the original 8,000-square-foot building, Yensen said. It will start doing so next fiscal year.

Yensen, a fiscal hawk, was appointed to the board in 2013 as talk of the need for an overhaul of the board gained strength. All but two of the board’s current members have been appointed in the past 18 months.

While Yensen opposed the building expansion and voted against it when it came up four years ago, she does not consider telling people “I told you so” nearly as productive as having a plan for the here and now. She said she is confident the new board will come up with a solution to help defray the building costs.

“I think people in the community and on the County Board understand that we are moving forward in resolving these problems in a very positive manner. I really believe that,” Yensen said.

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