A $4,000 winning bid for an empty lot on W. Oak Street had to be refunded, as the city had no right to sell it. It was already under lease to the Railroad Heritage Museum – for $10 a month.
“We look foolish,” District 5 Council member Dana Goolsby said at Monday's council work session. “We look foolish. We didn't keep up with this, and we let it go up for bid.”
City Manager Leslie Cloer told the Herald-Press Wednesday turnover in key city positions was partly responsible for the error.
“We've transitioned people in finance, public works, and developmental services fairly recently,” she said. “The mistake shouldn't have happened. Sometimes with transition, however, we realize things should have originally been done differently.”
To ensure such an error does not happen again, Cloer has removed all properties from the city website to investigate ownership and to audit the program.
“We must have accountability,” she said. “We also must make sure all properties owned by – or in trust to – the city are covered by the city's insurance.”
Cloer said the audit should be completed, and properties returned to the city website, by the June 24 council meeting.
Goolsby also questioned past council decision to lease three city-owned properties for such a low price.
Mayor Steve Presley, a councilman when the lease was approved by then-City Manager Mike Alexander in 2016, said the lease-holder, the Texas State Railroad Society, planned to turn the museum into a tourist attraction.
“We all have grandiose plans,” Goolsby said. “However, we don't all have resources.”
The lease, good until 2021, rents the TSRS the building at 808 W. Oak St., and the adjoining properties of 806 and 810 W. Oak for $120 a year. The city also has agreed to pay utilities on all three properties.
In return, the TSRS is responsible for upgrades to the building's electricity, repairing the roof and floors, demolishing the office area, and installing new air conditioning units. Those repairs have been completed, Presley said.
Goolsby, who told the Herald-Press she understands the museum's value to the community, said such a deal sets a dangerous precedent.
“We have to have a standard,” she said. “Do we offer this same type of deal to everyone?”
Presley said the city regularly helps non-profit and community organizations, and has done so long before its deal with the railroad.
“We pay the utilities at the Farmer's Market,” he said. “We don't charge any rent for the Museum of East Texas Culture, either; and its tourist traffic wasn't near as much as what was seen at the Heritage Museum last year.”
Tourism and Marketing Director Mary Raum told the Herald-Press the Heritage Museum had 1,640 visitors in the last year. The museum's profit margin, she said, however, does not convey its worth to the city.
“They've done so much for the community,” she said. “They provide something different to do, six days a week. They provide a place for area schools to take class field trips, and they teach local residents about Palestine's railroad heritage.
“Union Pacific hasn't opened a museum in town, have they?”
Linda Price, president and treasurer for TSRS, told the Herald-Press the museum is growing.
“Our vision is to create a railroad-themed park,” she said. “It will increase tourism and knowledge of the history of the railroad business in Palestine. We eventually hope to encompass all three lots into one park.”
Presley said it will be a council decision whether to renew the museum's lease in 2021, but he hopes it does. “It's a benefit to tourism and the community,” he said.
For information on the Texas Railroad Heritage Museum, call 903-586-7141, or visit online at: https://www.tsrrsociety.com/