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Inyo County has an opportunity to have a third-party appraiser take a look at property the Los Angeles Department of Water and Power is preparing to auction off to be sure the starting bids are not higher than the market value.
The Board of Supervisors had a split vote Tuesday because members could not decide if the board was willing to invest the $15,800 for the appraisals without any guarantee that the LADWP would use it or reimburse the county for the contract.
In the end, the board voted to hold off until it could get more definitive information from LADWP.
County Administrative Officer Kevin Carunchio said that he and the LADWP, in the interest of speeding up the process for the land auction, had initially decided the county could provide the appraisal services for the department and be reimbursed at a later date.
From there, Carunchio began negotiations with C.A. Bretton, Inc. for the appraisals, but recently, LADWP staff has been reluctant to proceed with developing an agreement for reimbursement.
Carunchio advised the board to enter into the contract without the reimbursement agreement to ensure LADWP is prepared to hold the auction in the spring of 2011. Per the Inyo-L.A. Long-Term Water Agreement, the department is required to make a good faith effort to sell the parcels. When the LTWA was written, the idea was to release LADWP land into private ownership.
âThere is some risk that there will be no reimbursement,â Carunchio said, adding that, if the county has an independent appraisal of the property done, it can hold the LADWP accountable if the department opts to appraise the land itself and sets minimum bids for the land above what the county appraisal says is market value.
Fourth District Supervisor Marty Fortney said he liked the idea of having an independent appraisal done on the land to be sure the minimum bids set for the auction are fair.
âI think DWP over-inflates their property value,â Fortney said, adding that he was not sure if he was willing to spend $15,800 without a guarantee that the money would be reimbursed. âIf the department doesnât have any obligation to even look at this, Iâm hesitant to push it forward.â
Second District Supervisor Susan Cash said she is afraid the LADWP will not stick to the time line set for the spring 2011 auction.
âI have no confidence,â Cash said. âTheyâre schizophrenic in their interpretation of every line of the Long Term Water Agreement. I have no confidence in their time lines, these appraisals are going to go stale. Iâd be much happier with a written agreement that would guarantee reimbursement.â
Cash also said that responsible bidders on the property will likely conduct their own appraisals of the lots before making their bids.
County Counsel Randy Keller pointed out that, even if the LADWP doesnât reimburse the county for its costs on the appraisal, the document could be used to prove whether or not the department âmade a good faith effort to sell the properties.â
Third District Supervisor Beverly Brown was in favor of signing the contract and having the appraisal done, whether the LADWP reimburses the county or not, to be sure the properties are sold for market value.
âI think itâs important to have an independent appraisal,â Brown said. âWe canât wait around for the department to play their little board games anymore.â
Brown made a motion to approve the contract with C.A. Bretton, Inc. The other four members voted against the motion in favor of having county staff meet with the LADWP to get a better idea of whether or not the department will stick to its time line for the auctions and if it will reimburse the county for the cost of the reimbursement.
That discussion will come forward at a future board meeting.