Homeowners, church balk at state offers

Its stained-glass window, depicting the 1812 voyage of America's first Baptist missionaries to India, has lured visitors from all over the country. Its brick walls were spared from Salem's Great Fire of 1914, which consumed hundreds of the city's other buildings.

Now, the 200-year-old First Baptist Church in Salem is immersed in a high-stakes battle and facing an uncertain future. State officials are offering $1.04 million to buy the downtown building on Federal Street to make way for a $106 million court complex, but church members aren't biting. They say the offer is too low. The deadline for the church to accept or reject the state's latest offer is tomorrow, according to parties involved in the negotiation.

One of the church's most devoted members, 79-year-old Robert Addison, who was baptized and married in the sanctuary, said he favors selling the historic church to the state because officials have promised to preserve the building's historic ``meeting house" section and incorporate it into the planned court complex. But Addison added the state's $1.04 million offer is hardly a fair price for a 13,926-square-foot building sitting on nearly an acre of land.

``The church is right in the center of town. That would demand a very high price, per square foot," said Addison, who retired in February after 40 years as the church's moderator, overseeing business meetings.

Addison isn't sure what would be a fair price because the church, he said, still had not had the property's value appraised by the time he retired. Yet keeping the aging structure open has become costly, Addison said, with high heating costs and an estimated $70,000 needed to make the building handicapped accessible. The city assessor's office lists the tax-exempt property's value at $1.39 million -- $350,000 more than the state's offer.

Lieutenant Governor Kerry Healey last summer announced plans to renovate the cramped Probate and Family Court building on Federal Street and connect it with a new mega-complex to be built next door that would include 16 courtrooms for district, superior, juvenile and housing court proceedings and be completed in 2010.

But standing, literally, in the way of that plan is the First Baptist Church and three other private properties on Federal Street the state said it needed to acquire before construction could begin. Behind-the-scenes negotiations with the church and at least two of the other property owners have become testy, with the church's lawyer and the property owners saying the state's financial offers are way too low, and the state saying it is ready to move forward by building around the church and taking the other properties by eminent domain.

``We are assuming the church site won't be available , and we are moving forward from there and designing around it," said Kevin Flanigan, a deputy director at the state's Division of Capital Asset Management, which oversees state construction. ``Our first preference is to come to some sort of negotiated agreement to purchase those [other three private] properties. However, if that is not possible, we do have the authority under the statutes governing this project to take properties by eminent domain, but that's not our first preference."

Flanigan declined to discuss details of the negotiations, including the timetable for when the church and the other property owners must respond to the state's offers. However, others involved in the negotiations said the state sent letters stating it expected replies by tomorrow . The church's lawyer, who also represents one of the other property owners, said the state had not upped its financial offers as of Tuesday afternoon, when Globe North went to press.

Jim Masterman, a Boston attorney and eminent domain expert who represents the church and Peter and Kathie Strout, owners of a six-family building on Federal Street that is also on the state's wish list, said, ``If we do not respond or agree with their number, they can walk away and leave us alone, or the Sword of Damocles falls and they take the property for whatever they think the property is worth."

Speaking for the church, Masterman said he hoped the state would come back to the bargaining table tonight with a better offer because most of the church members believed the state would be a ``good custodian of this treasured building." He was skeptical of remarks by state officials that they'd build around the church.

``What's more important to the church is that we have full, bona fide negotiations for the acquisition of this property and the relocation of the church to another site," he said.

Peter Strout said he also would prefer settling with the state, rather than dragging the matter into court. Strout said the state's offer of $630,000 for his building and land is barely more than he paid for it. He and his wife bought their six-family property on Federal Street in 2004 , he said, for $615,000, spent about $10,000 fixing it up, and then lost at least $20,000 in rental income after the state announced its building plans last summer and anxious tenants looked elsewhere for housing.

Another Federal Street property owner, David Rifkin, said he also rejected the state's offer, although he declined to discuss details. Rifkin, a lawyer who runs his practice out of the building and maintains an apartment upstairs for his son, said he suggest ed to state officials that they instead move his historic property -- built in 1812 -- down the road, out of the way of the court complex.

``I've been there for 31 years," Rifkin said. ``I don't want to sell."

Owners of the third property, Stephen and Linda Morris, could not be reached for comment.

Kay Lazar can be reached at klazar@globe.com