Burned town garage sparks fight between Hopkinton, Local Government CenterBy NANCY BEAN FOSTER
Union Leader Correspondent
November 25. 2012 8:27PM
HOPKINTON - As selectmen prepare for a special town meeting Tuesday to raise funds to build a new highway garage, they're still sparring with the Local Government Center over the value of the garage that burned down last summer.
Representatives of the Local Government Center (LGC), which insures the town's 30 buildings, attended a meeting of the board of selectmen last week to try to bridge the gap between what the town thinks the highway garage was worth and what the LGC is willing to pay.
According to Jim O'Brien, chairman of the board of selectmen, the garage's appraised value was set at $1 million. But after the fire, two things happened. First, LGC discovered that for about seven years it had been over-appraising highway garages across the state. This error wasn't discovered until after the Hopkinton building was destroyed, O'Brien said.
LGC adjusted the appraisal of the building, then brought in a builder to determine the cost of rebuilding the highway garage, he said. It was determined an exact replica of the building would cost around $630,000 to build. That's the first offer LGC made to Hopkinton, O'Brien said.
The board, which had been paying premiums on an appraised value of $1 million, refused the $630,000 and brought in an independent appraiser. That appraisal came in at $740,000, which LGC offered to pay. But the selectmen haven't accepted that offer either.
The sticking point, O'Brien said, is that the town has been paying insurance on a building appraised at $1 million, and thinks it should get $1 million to replace the building.
The LGC sees it differently, according to Wendy Parker, executive director of risk pool operations.
According to Parker, the $1 million is essentially a benchmark figure for insuring the building. The number that matters is the actual cost of replacing the building which could be over - or as in the case of Hopkinton - under the appraised value, she said.
"You're insuring the building you had," said Parker. "If it had cost more than the appraised value, we'd be on the hook for that."
O'Brien said he's still not comfortable with that explanation and the negotiations will continue.
In the meantime, there will be a special town meeting Tuesday at 6:30 p.m. at the Hopkinton High School. The board will be seeking to bond $1.3 million to build a new steel building on the site of the old highway garage.
O'Brien said the board made the decision not to replicate the wooden garage because the per-foot cost of building steel was cheaper and would produce a much better facility. Whatever the final settlement between the town and LGC is will be used to pay down the bond. Taxpayers will make up any difference, he said.