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January 31. 2013 8:55PM

Insurance settlement reached for Hopkinton garage

By NANCY BEAN FOSTER
Union Leader Correspondent

HOPKINTON - The battle between the town and the Local Government Center over the value of a highway garage destroyed by fire this summer has been settled, and now it's up to the voters to raise the additional funds to replace the barn.

According to Selectman Jim O'Brien, chairman of the board, after a lengthy negotiation and a series of offers and counter-offers, LGC and the town settled for a sum of $790,000. The town has contended since shortly after the fire that the building was worth $1 million, the amount LGC appraised it for and based the insurance premiums on, but LGC was willing to pay the town only the replacement value of the building, not the appraised amount.

The town and LGC had reached an impasse and were heading for arbitration when the $790,000 figure was floated. O'Brien said the board weighed the costs and the risks of moving forward into arbitration and decided to take the settlement.

"I don't think any of the board members are pleased at the outcome," said O'Brien. "This process was much harder than it should have been. It's definitely left a bad taste in our mouths. "

But since the settlement was reached, LGC has given the bulk of the money to the town.

"They have hand delivered us a check for $500,000 and they're release the rest after town meeting," said O'Brien.

At town meeting, voters will be asked to appropriate $1.3 million to build a new highway garage that's larger and more modern than the one that burned. The $790,000 will offset part of the cost, but the voters will have to bond the remaining $510,000 to pay for the upgraded building.

"We feel like for $510,000, we're getting a building that's going to last for generations for a reasonable price," said O'Brien. "Not having a building really puts a strain on the highway department."

After town meeting, the board will start taking a hard look at whether it wants to continue doing business with LGC.

"We've been contacted by other companies with offers so we'll have to sit down and look at what our options are," O'Brien said.

nfoster@newstote.com