Dickinson City Hall could move to the American Insurance Center building in 2021, while the American Bank Center banking building will be demolished and replaced.
ABC is currently constructing a new bank facility on Second Street West, with plans to bring the insurance center, located on First Street West, into the new building.
The city and ABC have an agreement that the current bank building, also on Second Street, will be demolished and deeded to the city for a proposed town square project.
A vacant parking lot on First Avenue West owned by the city will go to ABC, as well.
In discussions with the city, a deal was made for the recently renovated, historic site.
"There is some additional space needed for city offices here at City Hall. We're really busting at the seams in this building," City Administrator Joe Gaa said. "To build a new City Hall would be a very expensive undertaking. We didn't feel that was appropriate."
City Commissioners Tuesday approved both a memorandum of understanding for the parking lot and a purchase agreement for the AIC building.
Commissioner Carson Steiner abstained from both votes, as he is currently an employee of American Bank Center.
ABC will sell the insurance building for $1.1 million and receive the current City Hall building in trade to sell, for a total value of roughly $2.6 million.
"It's much less than building a new building and we would double the amount of space over there," Gaa said. "Definitely room for growth in the future."
Other options were considered, including purchasing an existing building to use as an annex and create more space at the current City Hall at 99 Second St. E., built in 1999.
"We looked at that over a several month period, not liking those options very well," Gaa said. "Staying under one roof, making it a convenient one-stop shop was important to us."
The city would take possession of the insurance building in January 2021 and complete a few minor alterations before moving in that summer.
If the deal is approved, the city would first complete the adjacent town square site.
"This is essential so the (Downtown Improvement District) and (Downtown Dickinson Association) can begin their fundraising campaign, which is part of an agreement we have with them to make the town square a reality," Gaa said.
The new American Bank Center also has to be built and the old site must be torn down.
Logistics on the parking lot will also be finalized.
"We know we'll own some, (ABC) will own some, but (we'll be) making sure it maximizes the usage," Gaa said. "It's a lot of discussion, but there's time to do that."
Mayor Scott Decker said the move would address the needs of the city.
"We can't build a building like Fargo," he said. "This was just such a unique opportunity to get into a historic building that has been completely renovated.
"We couldn't find a better facility that this."
The purchase would not impact taxpayers.
Among options, funds could be drawn from the city's future fund, Deputy City Administrator Linda Carlson said.
"The future fund is investments and we have set aside in our financial reports there's about $7 million in there," she said. "With that, we can have options of either transferring funds out of there for cash and purchasing, or we could use a loan to ourselves, where we've done that before."
The purchase agreement is contingent upon approval from the ABC board and staff.