Former car dealership Simpson Ave. Ocean City

A group of Ocean City residents submitted a petition to force a referendum on the city’s purchase of a former car lot next to the Community Center for $9 million. But the city clerk said that it didn’t have enough valid signatures.

OCEAN CITY — While city officials have not announced plans for a newly purchased 1.86-acre property that once housed a car dealership, the city has commissioned a study of whether the site would be good for a new police station.

That has led many residents to think the $9 million purchase will be followed by the need to spend much more for a new building.

City Council voted unanimously Thursday night to buy the property.

City Solicitor Dorothy McCrosson said the feasibility study “was favorable enough the mayor and Mr. Savastano (Business Administrator George Savastano), a professional engineer, decided to move forward with the acquisition.”

She also said Klause Enterprises, the owner of the property, approached the city and offered the property for a firm $9 million, with no negotiation possible.

The city then got two appraisals that came back with values of $8.3 million to $9 million. The higher appraisal, published in an earlier story as $9.2 million, was adjusted down because it had overestimated the number of homes that could be built there, she said.

Klause Enterprises is owned by local car dealer Harry Klause and his brother. The property is bordered by 16th and 17th streets and Haven and Simpson avenues.

The vote came after about a dozen residents spoke against the ordinance, saying $9 million was too much to pay, or arguing the public should know what the property will be used for before any decision is made. Some argued the money could be better spent on flood mitigation efforts.

The one resident who spoke in favor of the purchase encouraged council to turn the parcel into a public park rather than build a new police headquarters there.

“That area is one of the worst flooded areas in Ocean City. I looked out the other day, and it was a complete lake,” said Marlene Sheppherd, who said she has lived across from it for 40 years. “Think about developing an Ocean City Commons much like in Boston. Let’s not develop it. It’s not a place for a police station.”

Mayor Jay Gillian has said buying it will prevent high-density housing from going there and will create a public corridor between the Intermediate School, the community center and Palmer Field. The lot qualified for construction of 29 high-density coastal cottages and one regular housing lot, according to McCrosson.

Under the ordinance, the city would bond $8.55 million and pay an additional $450,000 as a down payment to Klause Enterprises.

Klause, who owned Harry Klause Cars and Trucks elsewhere in the city before pleading guilty to wire fraud involving auto title problems with his business in 2013, now works at Ocean City Cars and Trucks on Asbury Avenue.

Council members stressed this may be the last chance to acquire such a large parcel.

“If we walk away from this deal, guess what we are going to get?” said Councilman Michael DeVlieger, referring to more housing. “This is a block of open space that sits between public lands critical for us and our community. We have an obligation to preserve Ocean City.”

Council also introduced an ordinance authorizing the city to purchase three other smaller lots that are part of the same block, either through negotiations with the owner or by condemnation if a price cannot be agreed upon. In the latter case a court would decide the price.

McCrosson said the city did not negotiate with the owners of the smaller lots, including onetime mayoral candidate John Flood, before announcing plans to buy the larger parcel for $9 million because the owners were unwilling to negotiate until now.

Contact: 609-272-7219 mpost@pressofac.com Twitter @MichelleBPost

Staff Writer

In my first job after college got paid to read the New York Times and summarize articles for an early online data base. First reporting job was with The Daily Record in Parsippany. I have also worked in nonprofits, and have been with The Press since 1990.

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