AG 2014 12 15 - Laserfiche WebLink

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Memo To: Board of Commissioners From: Jonathan Marshall, Infrastructure & Asset Management CC: Mike Downs, County Manager and Richard Koch, County Attorney Date: 11/21/2014 Re: Property exchange for Wallace Park Staff discussed with the previous Board of Commissioners the need to obtain property for an alternative access to the Wallace Park property. The acquisition would provide an access that did not require a rail crossing and, after exchange of property, allow part of the existing property to be marketed for private non - residential development. Robert and Donna Wallace have acquired a parcel on Bethel School Road for the purpose of exchange and to provide the new access. The properties to be exchanged are not of equal value, but a value for each must be determined for the exchange documents to be prepared. The County owned property at the corner of Wallace Road and US 601 on the south side of the railroad is the parcel planned to be transferred to the Wallaces. That parcel was appraised by Integra Realty Resources and was previously proposed for sale to a private party for non - residential development. The Market Value Analysis from the appraisal was used as the sales price for the parcel in that proposed transaction. Consistent with that proposal, the value based on the Market Value Analysis is $780,000. The Wallaces acquired a parcel on Bethel School Road and have submitted records and information on the costs of acquisition and some property improvements that were performed. The acquisition costs include the sales price, survey costs, legal costs and other due diligence that total $231,796.50. Wallace Construction also performed work on the property once it was acquired that included, among other things, proper disposal of a demolished house and mobile home that were buried on the property, improvements and stabilization of a dam, general clean up, dead tree removal and some basic grading. That work totaled $38,787.26 and was all work the County would had to have done at some point before the property could be used. The total value for the parcel they propose to exchange is $270,583.76 which is less than the tax value for the property of $290,410.00. The difference in values of property being exchanged is proposed to be used to reduce the total sales price included in the Installment Purchase Agreement. That difference is $509,416.24. In addition, the original Installment Purchase Agreement included a payment of $120,000 to the seller as compensation for improvements and a signaled rail crossing (total estimated value of $225,000) for the access off Wallace Road. The inability to use that access precipitated the alternate access acquisition. Consideration should be given to adding some part $120,000 to the amount taken off the original sales price. There is remaining value in the improvements and access road, particularly if an additional parcel is exchanged for non - residential development along the railroad tracks. Should the County cost of the access road be split evenly ($60,000) with the Wallaces, the total difference in value to be considered in redrawing the purchase agreement would be $569,416.24. That is approximately equal to three annual payments of $190,000 that would not be due to be paid to the Wallaces. Attachment number 1 G -1 Page 320