Wow! It’s really hot out there. I know about the weather. I’m talking about the real estate market. The prices of homes in Damascus are high and inventory low.
Suppose you have a commercial building on 1 ¼ acre that has a tax assessed market value of $356,080 by the County. Someone comes to you with an appraisal in hand, that was ordered by that person, and it shows a market value of $235,000. Similar properties in your area could go for $500,000 or more. The party offers you $235,000 and you readily accept. Smart move on your part? Most definitely not. However, Clackamas County Commissioners accepted a deal similar to this, and it is to be closed in escrow this month.
The Intergovernmental Agreement ( IGA ) Regarding Real Property between Clackamas County and Fire District #1 is troubling in that is appears to be a failure in the County’s fiduciary responsibility to the taxpayers of Damascus.
When the City of Damascus surrendered its Charter in July, 2016 there was a transfer of approximately $9,000,000 cash, real estate holdings by the City and miscellaneous equipment to the custody of the County. There is to be a net distribution to taxpayers of the remaining amount to the taxpayers of Damascus sometime after January 2018 when the County finishes its administration of the costs of disincorporation. This IGA negatively impacts the bottom line to the taxpayers of Damascus and is part of a closed door and unfair process.
The County tax assessor has the market value of the property located at 19750 Se Damascus Ln Damascus as $356,380. The property is zoned RA1 ( Rural Area Residential )and the current use is legal non-conforming. The appraisal ordered by the Fire District came in at $235,000. The County Commissioners, as sellers, agreed to sell for $235,000. A commercial realtor I spoke with estimated that this property would sell on the open market between $500,000 to $600,000 in a 30 day period.
This property was used for many years by the water district before the City took it over. It then was the office of the City police. The appraisal was ordered by the Fire District. The appraisal itself is puzzling and raises concerns. One is that the appraisal was formatted as a residential property, although it is in reality a commercial building. It has 2 rooms. One is classified as an office. One as a meeting room. The 3 comparable sales not only use residences with no sales date data, one of the comps is an actual foreclosure which low balls the value.
One has to wonder why the County Commissioners as sellers representing the taxpayers allowed an appraisal to be controlled by the Fire District as buyer without ordering a outside review or questioning why a residential format was used rather than a commercial format. Further, how did a market value come in that is 33% less than County market go unnoticed?
The non-competitive selling of this property to the Fire District precludes the taxpayers from other opportunities for greater return on this property that the City owned. When sold it also forces the the Damascus taxpayer to pay again for a property for which it had already paid.
The effort by any individuals in the Fire District, or its affiliated promoters to obtain this property, that were also correspondingly leaders and activists in the disincorporation movement over a period of years should have been recused as decision maker in this process. Is this property part of the spoils of disincorporation?
The Commissioners claim that they are selling the property to the Fire District to have a station for needed public safety services to include Damascus and the whole surrounding area of Damascus. It is of good cause, but is not keeping with their fiduciary responsibility to Damascans. This property should be sold on the open market and the proceeds should be part of the cash return to the taxpayers of Damascus next year.
The Commissioners have been entrusted with the custody of the cash and a real estate asset for the benefit of the citizens of Damascus. It is critical for them to earn the trust of the very people they represent. The Commissioners are to be held to a high standard in exercising their fiduciary responsibility. There are many taxpayers in Damascus that are looking forward to receiving their promised checks from the County sometime next year. Will they be pleased to see that the County put forth their best efforts, or will they feel that they were hosed by false expectations?
(Unless otherwise noted, the opinions expressed are the author’s and do not necessarily reflect the views of the Northwest Connection.)
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