By Mark Barnes
The October 10, 2013, special meeting and public hearing of the Kuna City Council to auction the 107 acres the city owned on Lake Hazel resulted in one citizen speaking, one prequalified buyer, but no bids.
The minimum bid was set for $3,213,900, approximately $30,000 per acre. The city had originally purchased the land at approximately $9,000 per acre for the sewer district as an outlet to irrigate treated wastewater uncertain that it could release it in the future into Indian Creek. An improved water treatment facility negated the need for this property’s intended use. Secondary plans for the property included using it as a future location for ballparks and recreation facilities.
The only citizen who spoke at the hearing was the farmer who leased the land and wanted to make sure that the irrigation equipment on it was not part of the deal.
As a result of the lack of bidders the city council was informed by City Attorney Richard Roats that, according to the law, they could entertain any other sale offers on the property or simply retain it. And, guess what? An offer was on the table.
A local developer, Timothy W. Eck, manager of EAMI, LLC made an offer on behalf of DBTV Agricultural Holdings, LLC for $2,155,900 for the 107 acres, $1,058,000 less than the asking price. Before the council could reject the offer or even express shock at the low-ball deal, Mr. Eck sweetened the offer with an assortment of other enticements tied-in with the land deal.
He informed council that he made the lower offer because the land was appraised at only $19,975.73 per acre, far below the asking price of $30,000 per acre the city wanted. It doesn’t make sense to pay for more than the asking price because from a business perspective, that land would have a much higher cost and development price.
Additionally, he would pay off the LID lien on the 20.164 acre Kuna-75 property that the city owned; a property planned for future ballfields and recreation park. That would be passed on to the City of Kuna. Additionally, he would pay off the LID lien on the Kuna-75 property that the city owned, another city-owned property planned for a ball field and recreational park. Furthermore, he offered to donate at the end of the year $135,000 that could be applied to a feasibility study for the Boys & Girls Club development or used by the city parks department. When it was all wrapped up, Eck’s offer amounted to $3,211,525.72 on the books, just $2,374.28 less than what the city was asking. But, there was a catch.
The catch was, the city needed to agree to this deal that evening because the closing date the bank set for the deal was for the next day, October 11.
In the most vigorous debate in months, Councilman Richard Cardoza, who was against selling the property in the first place, did not like the pressure the council was being put under. Agreeing with him was Councilman Doug Hoiland who felt “something stinks” in the deal because of the rushed nature. It was clear in the debate that Councilman Joe Stear and Councilwoman Briana Buban-Vonder Haar both were in favor of accepting the deal. Mayor Greg Nelson also seemed to be leaning that way.
Kuna City Attorney Richard Roats, city treasurer John Marsh and city engineer Gordon Law assured the council that the deal had been gone through and approved by city staff during the week as the details for it had been worked out. Law, who would see less money from the deal returning to the sewer fund that he manages told council there would be enough from the sale to cover future plans for sewer projects and maintenance.
Although agreeing that the deal seemed to put pressure on the council, Mayor Greg Nelson said that time is of the essence and future offers might not be this good with the news of the reduced appraisal on the land. He stressed that everything in the deal was “above board” and that Mr. Eck’s company was not trying to pull one over on the city.
The sale offer was accepted 3-1 with Councilman Hoiland voting to approve the deal, albeit with, as he put it, a “strained yes.”