The Fairhope City Council voted today to enter into a purchase agreement with the Baldwin County Board of Education for three parcels of property — including the landmark former K1 Center in downtown — for a price of $4 million. Other parcels include the K1 Center’s playground and the property that encompases the Nix Center on Bayou Drive, land the city currently leases from the school board.

According to the agreement, $2.5 million is due at closing before Dec. 31 and the balance will be paid in five $300,000 annual installments.

Neither funding nor uses for the proposed purchase have been finalized, but last month, the city applied for a $6.1 million grant from the Economic Development Administration that if approved, would require a $1.22 million local match. The grant would be used for the purchase and renovation of the property, but would require that a nonprofit job creator — in this case Hatch Fairhope, a business incubator initiative of the Baldwin County Economic Development Alliance — be the primary tenant of the building.

The City Council today heard from several people in favor of the plan, as long as portions of the property also maintain a “public use” such as an education center or performing arts venue. The land purchase contract approved today does include a reversion clause that the property be used for a “public purpose” for a period of 15 years.

Mayor Karin Wilson, who did not have a vote in the matter, urged the council to delay the vote and explore the “endless possibilities” with purchasing and leasing the property. If the grant is not approved, she cautioned, money will likely have to be transferred from utilities revenue, preventing the city from making much needed repairs to the aging and stressed sewer infrastructure.

“When the K1 Center shut down, it was almost like the downtown economy shut down,” she said of the effects of the school board shuttering the school in 2011. Wilson owns Page & Palette bookstore two blocks away.

“I’m a proponent of [the Fairhope Educational Enrichment Foundation] and as an entrepreneur I support Hatch and similar efforts, but I also support an economic impact that will not drain our coffers,” she said.

According to council and public comments, FEEF has expressed interest in using the property’s four outbuildings to create a STEAM (science, technology, engineering, arts and math) center. Kacie Hardman, director of the Pelican’s Nest science lab that is also on the property, said STEAM “is the gap that has been missing in our education system” and a STEAM center “will give [students] ownership to how they fit into this world.”

Rebecca Dunn Bryant, an architect who has served on the FEEF advisory board, suggested the project not “focus on the max return” and instead, consider it an investment in quality of life.

“This is a shared community space that reflects community values.”

Councilman Jay Robinson conceded “there has been no plan established for what this use will be,” but said he was committed to the educational element.

Burrell admitted the grant would likely not be enough to create a performing arts center, but he also envisioned bringing Coastal Alabama Community College to the campus, as well as FEEF, and a solar farm to partially power the property.

“The Hatch grant will cover the purchase and renovation,” he said, but if the city has to contribute more than the $1.22 million, “we’re doing pretty well financially right now.”

The council initially authorized Burrell to negotiate the purchase in February. He said discussions were slow because all parcels were encumbered by vague titles and deeds. When the council recently learned there was a competing, private purchase offer for the property, they scheduled a special meeting to enter into the purchase agreement.

Fairhope resident Dean Mosher said he drafted a counteroffer with Michael Mauron of Birmingham-based Capstone Development Partners. Mosher said Mauron offered to purchase the property outright and lease it back to the city, but also build a boutique hotel and paid parking lot, both of which could be a boon for the city’s budget.

But Lee Lawson, president and CEO of the EDA, provided an economic impact analysis from the University of Alabama suggesting in the next five years, Hatch would provide “266 new and indirect jobs with an estimated payroll of $16.8 million and total sales/output revenue for Fairhope of $33.65 million.”

The city must also pay $50,000 for an environmental remediation of a former fuel farm on the property. Gasoline tanks that were once used to fuel busses are still buried underground and must be removed. The Baldwin County Board of Education has yet to approve or sign the agreement.