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Council to authorize the City Attorney and staff to proceed with condemnations if negotiations <br />fail in the acquisition of the property. <br /> <br />Mr. Mulrooney gave the members his opinion of the cost of the land relative to the market for <br />industrial land without sewer and water. In his opinion, $11,000 per acre was more than <br />adequate considering that municipal sewer and water would need to be installed. In addition, he <br />believes that the City can be very successful in marketing this property as industrial land due to <br />its location near the railroad track, the location of County roads, the scarcity of remaining <br />industrial land in the northern suburbs, and the strong market. <br /> <br />Mr. Wagner asked if a formal market analysis or appraisal has been done on the property, to <br />which Mr. Norman responded that it had not been done. Mr. Wagner then asked what the <br />condemnation process consisted of. <br /> <br />Mr. Norman explained that the court would order three appraisals, the City would hire an <br />independent appraisal, the owner would hire an independent appraisal, and the court would have <br />a third appraisal performed. The judge would make the final decision on the price paid for the <br />land. Mr. Norman speculated that $15,000 is most likely the absolute highest price at which this <br />land would be valued. <br /> <br />Mr. Wagner asked if we needed a public purpose or cause to enter into condemnation <br />proceedings. <br /> <br />Mr. Norman replied that it was similar to other condemnation procedures that shows there is a <br />public purpose, such as the senior citizen apartment project, and the wetland which has industrial <br />zoning near Vision Ease and AEC Energy Park. The purpose would be economic development, <br />job creation, quality development, etc. <br /> <br />Mr. Wagner was of the opinion that it seems very early in the negotiation process to begin <br />condemnation proceedings. He also said that it seems that the owners have a better negotiation <br />stance. <br /> <br />Mr. Norman did not feel that was true. The owners have been marketing the property for <br />$1,500,000 for several years and it has not sold. After they saw the Comprehensive Plan and <br />realized that the City was interested in purchasing the land, they raised the price. What the <br />owners don't seem to account for is that the City controls the extension of services into that land, <br />and the land value would not significantly increase until after the extension of services and after <br />some quality projects were built, and the interest paid on the land in the meanwhile. They are <br />asking $3,000,000 for land that may be worth that after some years and much development, but <br />as a vacant parcel, it is not worth that much now. The City has taken a role in quality <br />development only since 1993 or 1995. Also, entering the condemnation process does not <br />preclude negotiations for a better settlement, but it seems the logical next step because the asking <br />price is much too high and they are not willing to budge from that stance. ("They" being BMA <br />Associates.) Mr. Norman continued in his explanation of the process stating that both parties <br />must take the court's decision regarding the price. The owners can appeal the decision if they <br />are not happy with the number decided upon by the court. At that point, the City has right-of- <br /> <br />Economic Development Authority/January 12, 1999 <br /> Page 2 of 11 <br /> <br /> <br />