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Although the name of the agency wasn't disclosed at Wednesday's city council work session, Sanilac County Community Mental Health is interested in buying property at the northeast corner of Campbell Road.

At the Jan. 29 mental health board meeting, the unofficial minutes reported passage of a motion "that the Building Committee gather the necessary information for consideration of the purchase of the parcel of property on the northeast corner of Campbell Road, along with information on bond sale, and bring the information back to the next meeting for further discussion before a final decision is made."

The minutes of the board's Program Committee on Feb. 11 reported, "Dr. (Roger) Dean reviewed with the committee the issues identified by the Board and Mr. Campbell's response...There are several new issues that have arisen that further complicate the process."

Dean, director of the mental health agency, could not be reached for comment.

At the work session, architect and planning consultant Orrin Campbell and his client, Scott Campbell, discussed an unnamed non-taxable agency's interest in the property at the corner of Campbell and Miller roads, as well as a second parcel on Miller to the west - adjacent to the USDA Service Center near M-19. Scott and Nancy Campbell of Sandusky own both properties.

Several issues need to be resolved before either property can be developed: sewer and water services must be available; who will pay for the services; road construction on Campbell and road improvement on Miller; and annexation of land to Sandusky.

Orrin Campbell, who has also been retained by the community mental health board to find a building site for the agency, told council members that the unnamed buyer wants to construct a 40,000 square foot building on one of the Miller Road sites.

Both properties are in Watertown Township and both would need water and sewer for development to occur.

The 10 acres planned for development at Campbell and Miller are located to the south of the Black Drain and the city's industrial park. The south half of the property, closest to Miller, would be for the mental health building.

"We have a client interested in a 40,000 square foot building on five acres, and a couple different smaller" buyers interested in 5000 square foot buildings to the north along Campbell Road, said Orrin Campbell.

It's unclear who would pay the estimated $209,000 for extending sewer and water from the south end of Industrial Park II, which ends about 560 feet north of the Black Drain, to Miller Road.

The Campbells claim the city attorney and the mayor previously agreed that the city would bear the expense of the lines. The agreement was reached when Scott and Nancy Campbell sold the city 17.2 acres for Industrial Park 2 last year.

However, Councilman Keith Costine noted that if a deal was struck, it was not part of the purchase agreement approved by the council. But he did not think the issue was insurmountable.

"That can be dealt with," said Costine. "We can get something worked out."

He added, "My concern" is that taxpayers in the city could end up footing the bill for a non-tax paying entity that might only create "a couple jobs."

However, Orrin pointed out that other tax-paying businesses are "knocking on my door" for property, and the availability of water and sewer along Miller would attract developers for medical-related and other businesses.

The second site - next to the USDA building - also has hurdles to development. Orrin explained the apparent Catch 22: the city would only provide water to the property if the land were annexed; while Watertown Township has indicated it would only extend the sewer line - which currently stops at the USDA property - if the property remained in the township.

Running a city water line to the second site would require the annexation of a strip of land along the south side of Miller Road - from Campbell Road - of about 2000 feet, according to City Manager Lou LaPonside. The cost of the line hasn't been calculated.

Another option for water at the second site would be a private well, according to Orrin. But he said taking that route would be complicated for a developer, because of factors that range from water pressure and chlorination, to arsenic removal.

Road construction and improvement are additional issues that muddy the waters. The city wants to extend Campbell Road south from Industrial Park 2 to Miller Road and then improve Miller to M-19, for a new truck route around Sandusky.

However, federal road funding for the work is a few years away. The project is on a list for 2012-13.

Council members indicated they would collect cost figures for the lines, and work to resolve the issue of responsibility for extending lines to Campbell and Miller.

The Campells, meanwhile, will contact the Watertown Township Board.

"I can tell you, there is a tight timeline" for the building project, which is currently at an "impasse," said Orrin Campbell.