Wiacek - court valuation, CtPost article

The CtPost today reported on the court's final decision regarding valuation for an Open Space acquisition known as the Wiacek Farm by the City of Shelton.

One of the roles of myself and others on the CC is to advocate for land purchases we think are appropriate. The CC comments are purely advisory, and the only tool we have is the power of persuasion based on following consistent goals or directions (the Open Space Plan), and being persistent. (When I took over Chairmanship of the CC in 2004Nov, I quoted Calvin Coolidge as my guide to be persistant, and consistent).

The CC has no fiscal decision role in Shelton government. Though we may make suggestions and serve a supportive role regarding fiscal course of action (ie: giving presentations to explain a referendum question), finances are the realm of the BOA as the City's final fiscal authority.

While this CtPost news article deals mostly with fiscal issues, the public opinion of process as to how the City arrived at this parcel's state of affairs is important to me, and thus I clarify the article with my comments within the article below. Too that end, I published a google document spreadsheet that outlines all the values and ratios that I think should be the more appropriate comparisons, as I more fully describe below.

I encourage readers to go to the CtPost article as they are the content creator of the article and have methods for readers to comment on their articles within their website. I cut/paste with my comments under right of fair-use for public education as Chairman of the Conservation Commission.

http://www.connpost.com/valley/ci_11836579
Shelton to pay more for Wiacek property
By Kate Ramunni STAFF WRITER
Updated: 03/04/2009 10:05:12 PM EST

SHELTON -- A Superior Court judge has determined that the Wiacek property the city took by eminent domain five years ago is worth almost a million dollars more than the city claimed.

+++ First, if you want to research the facts, you can see other comments I've made on this blog over the past several years where this was ever mentioned - use the search box at the top of this blog with "wiacek" for term. If you want to see any emails where the CC possibly discussed the subject try this discussion search link to our google group that publishes all our emails live to the public to satisfy FOI rules. If you want to see any City of Shelton agencies discussion over the parcel, visit this sample of a site restricted search to find it mentioned in the minutes of the IWC, PZC, BOA, or CC at the very least. Regarding the opening line: The CC made a presentation on 2004/Jan/7 advocating it be acquired. The BOA passed a motion to pursue eminent domain at their 2004/Sep/30 mtg. The "taking" due to eminent domain would have occured upon filing the paperwork which would likely have been within days of the BOA decision. +++

Last week, Judge Bruce Levin in Milford Superior Court ordered the city to pay about a million dollars more than the city's appraisal of the property, about 40 acres off Meadow Street next to Shelton High School.

The land was in the Wiacek family for about 85 years, according to attorney and Wiacek family member Shawn Splan. Splan and his cousin Walter Wiacek had just gotten land use board approvals for 24 lots on the property in 2004 when the city began the proceedings to take the property.

+++ The CC encouraged the City to consider buying this parcel (along with two other parcels during the same presentation). The BOA authorized the Mayor to negotiate with the owners (for all 3 parcels in the presentation) toward purchasing them. One of the Wiacek parcel owners stated among several public mingling at the end of the meeting that the only way the City would get the property is via eminent domain. The City still attempted to negotiate and the Mayor has stated he even had phone calls with the owners during his family vacation time. The owners pursued a development application for the parcel. The process was delayed in part due to errors from the owner's hired soil scientist expert who had mistakes while wetland flagging on the parcel. All regulatory agencies gave the application fair and standard treatment thru to approval. The approval of subdivision layout and subsequent qty of building lots allowed both parties to evaluate a realistic appraisal of value. +++

At the time the city's appraisal for the land came to about $2.5 million. The $2.5 million sale price works out to roughly $62,500 an acre.

+++ The City did indeed have an outside appraisal value the acreage it desired to acquire at apx. $2.5mil, with an acreage stated in the 2004/Sep/30 BOA motion being 39.7 acres. This was later corrected in the minutes of the 2004/Oct/14 minutes to be 35.99 acres as reflective of the legal description for the land area in the taking, and that is $69,463 per acre. However, that is not an appropriate metric upon which to compare with other areas. The subdivision approval map was the basis upon which the description for land taking was made, and it covered 20 of the 24 building lots which at that juncture were in an unimproved state. This works out to $125k per unimproved building lot. An unimproved building lot is one where subdivision approval exists, but there still is required from a developer the improvements such as roads, underground utilities and such, for building construction to take place. These improvements include City depts requiring bonds to ensure the proper construction standards are met before the City takes ownership and responsibility of areas such as a new City street. After certification by the City engineer, bonds can be released. Nobody should make the leap of thought comparing this to a personal dwelling sitting on an acre and being worth a hell of a lot more than $125k per lot or per acre. The comparison is not apples to oranges. At the time when the City took the property, the appraisal considered the status that the property was in. Some in the public tried to claim it should be valued at $8.2million (BOA 2004/oct/14 p.6: Gene Hope, p.18: Irving Steiner), something now determined by the courts to be far from reality. +++

The Wiacek family's appraisal came in about a million dollars higher. Last week a judge ordered the Wiacek family be reimbursed 85 percent of the difference, along with interest.

+++ Appraisals are done by proffessionals who certify their justifications by doing market comparisons. They can vary. If the Wiacek's appraisal came in at apx. $1mill more (I'm relying on the news report as I don't have access to real documents or exact numbers), and the judge approved of 85% of that valuation, that is $850k more than the $2.5mill of the City's appraisal for an apx. judge ordered valuation of $3.35 million. This is equiv to apx. $167.5k per unimproved building lot. +++

Splan said the city could have avoided the cost of going to court had it treated his family fairly, such as how it treated developer and former Inland Wetlands Commission chairman Al DaSilva.

+++ That statement is in direct opposition to the comment made in the presence of several people after the public presentation to the BOA where it was stated that the only way the City would get his property is by eminent domain. +++

The city paid $2.1 million, or about $150,000 an acre, for DaSilva's 14 acres off Soundview Avenue, which abuts the Wiacek property.

+++ The city purchase price was $2,124,500 for property at 279 Soundview Avenue, purchasing it from Huntington Development Group LLC, an entity where it is common knowledge that at least one of the members is Alvaro DaSilva, the former Chairman of the Inland Wetlands Commission, having stepped down just shortly before this transaction agreement. That was after a "gift value" of $100k was discounted from the agreed contract value between the City and the seller. Thus the City had agreed to "value" the property at $2,224,500. The appraisal from the City for the 14 acres was $1.8mill, the appraisal from the owner was $2.2mill. I'm not part of the negotiation process, but the negotiated price and what was agreed to by the BOA and shown in their minutes was the $2.1 net purchase price (which was agreed to be spread out over several payments). At 11 lots approved for this parcel - that is $190,909 per lot. +++

Splan said five years ago it was a very different real estate market than it is today. "We always would have rather had the land and the opportunity to develop it during the golden age of real estate," he said. "We could have lived with it if they had paid us the same as they paid Al DaSilva -- when we went to market the property, the economic times were a lot better than they were in 2007" when DaSilva's purchase was done.

+++ Timing does need consideration. The difference is $23,409 per lot, a 14% increase from the time of the 2004 Wiacek acquisition (the court valuation is based on the time of the taking, even though they decided upon it in 2009) and the time of the 2008 Soundview purchase - a span of about 4 years. +++

Board of Aldermen President John Anglace said he hadn't yet seen the ruling but was not surprised by the outcome. "That's the process," he said. "That's what you do -- you see what the fair market value is for the property."

The board took criticism at the time of the action from some residents who said the city would end up having to pay far more than the $2.5 million -- some said that price would be as much as $8 million. "There is a big difference between this and what they said," Anglace said. "I said it wouldn't be anywhere near that."

The property is valuable to the city because of its proximity to Shelton High School, Anglace said. "It's part of the education complex up there."

+++ Anyone can see the CC presentation advocating reasons for acquiring the parcel. The BOA also made representations during the funding that it was for recreational uses and purposes associated with them. +++

The city will be able to pay whatever difference the court requires it to, Anglace said. The city has not done anything with the property yet, but Mayor Mark A. Lauretti said if needed, the land could be used as a school bus lot in the future, which angered residents of the nearby Summerfield Condominiums. Those residents spoke at the last Board of Aldermen meeting against the prospect.

"That's a pretty expensive parking lot," Walter Wiacek said.

+++ To think that the only use of the entire acreage of the property would be for parking school busses is simply short sighted. I have made a separate blog comment on the recent article regarding use of the property as a bus parking area. +++

The Wiacek family has another lawsuit against the city that is ongoing over the way the eminent domain process was carried out, Splan said.

+++ The first case was whether the City had the right to use eminent domain - court said yes. Next up was the valuation the City used and put in escrow, was it appropriate - court said no, pay more (which caused this article). Still to be decided, a case against public officials brought by the Wiacek's regarding actions taken during the approvals and permit to construct process. That will likely be decided during the summer. +++