East Ridge Mayor Brent Lambert said that he was surprised to get a phone call from Tennessee Department of Transportation officials in July informing him of a deed restriction on city-owned property that is being developed for the new Bass Pro Shops.
East Ridge News Online reviewed TDOT files on Tuesday and learned that in a December 15, 2010 letter Mayor Lambert asked TDOT officials to lift the restrictions and allow the city to sell the land for development. TDOT officials denied the request.
“This is the first time I recall seeing this letter,” Mayor Lambert said Wednesday. “I’m guessing John (former City Attorney Anderson) wrote it. That is not my signature.”
In a letter to TDOT Commissioner Gerald Nicely, Lambert referred to a meeting that he and the commissioner had on December 14. The letter was copied to Vice Mayor Larry Sewell, Councilmen Denny Manning and Jim Bethune, Interim City Manager Eddie Phillips, then City Attorney John Anderson and TDOT official Steve Allen. In the letter Lambert requested that the fire hall property purchased in 1999, “have any and all conditions to the development or use of that property removed by TDOT. Because the City of East Ridge may potentially use this land for purposes of economic development and is considering relocating the fire hall located thereon, and as East Ridge has paid actual consideration for this property, the request is the Tennessee Department of Transportation remove any restrictions to the use of this property for economic development.”
Lambert said that Anderson possibly wrote the letter on behalf of the city, a day after the mayor met with Commissioner Nicely. Lambert said that meeting involved the city’s purchase of 25 acres adjacent to the fire hall that the city turned around and sold to Exit 1 LLC.
“I don’t remember this (lifting the deed restriction to the fire hall property) being discussed in the meeting,” Lambert said.
Nicely’s response states that the city got the land for a fraction of its fair market value, and that if the City of East Ridge ever decided to sell it the city would have to make up the difference.
Lambert said he did not recall seeing Nicely’s letter in response, either.
In a City Council meeting on May 14, Councilman Jacky Cagle asked Mayor Lambert about problems associated with the Exit 1 development.
Lambert explained that the city was going through the bureaucratic process of having a deed restriction removed, and that he had recently spoken with TDOT officials and that the city would have some resolution shortly. Lambert lamented the fact that there was apparently no “institutional knowledge” of the restriction when the city began negotiating the incentive agreement with the developers.
Councilman Cagle asked how much this would cost the city. Lambert explained that when the land was originally purchased from TDOT in 1999, the city paid $50,000, a fraction of the market value at the time of $175,000. He said TDOT contacted him last summer and said it would lift the restriction but a new appraisal of the land would have to be done and the city would have to pay 71 percent of the new appraisal. Lambert said that sum would be about $420,000.
In the ensuing days following the meeting, Lambert found out that the new appraisal on the value of the land was actually $849,000 and the city would have to pay TDOT $603,000 to get the deed restriction removed and for work to continue on the new development.
In an interview on May 19, Lambert told East Ridge News Online that he did not inform the council of the deed problem because he believed it was an “administrative issue.” He said the city was contractually obligated to turn the land over to Exit 1 LLC.
In a Memorial Day press release, Lambert said “we fully expect to submit this expense under the Border Region legislation, in which East Ridge is so blessed to be a participant. The legislation is very complex, but essentially the full amount should be reimbursed by the State of Tennessee through the state’s share of sales tax dollars generated inside our city.”
On Wednesday, Mayor Lambert said that at some point he had to have seen the letter to Nicely.
“I’ll be the first to say that I’ve spoken mistakenly,” he said. “I’ll have to chalk it up to human error.”
Lambert said that he hopes the matter will be resolved by the middle of June, when the state signs off on the deed restriction and the sale of the property can go through to Exit 1 LLC.
“I’m assured that everyone who has a hand in it is aware it’s time sensitive,” he said.
