The
Dominion Homes, which
originally had entered into a contract with the district, sent a letter to
officials last month announcing it would not purchase the 16.8 acres of land
it had planned to buy for more than $2.6 million.
The property has been
appraised at $1.4 million, said Jonathan Boyd, district treasurer.
After a bidding war in
June between Dominion Homes and
Joseph Sugar, vice
president of land acquisition for Dominion Homes, wrote in a Dec. 6 letter
than the builder "... has elected not to proceed with purchase of the
Park Road property ... we recognize that we must forfeit the earnest money deposit
of $50,000 as liquidated damages ..."
An increasing
interest-rate environment and basic market conditions are what led Dominion
Homes to its decision, said Tom Hart, vice president of government affairs.
"The real estate market has slowed financially," he said.
"This is purely a
business decision that relates to the market at this time."
Hart said Dominion Homes
needs to make sure that every investment must bring an attractive rate of
return.
"It's a situation
where it's a pricey piece of land," Hart said.
Boyd said he is in
negotiations with developers who might be interested in purchasing the land.
State law dictates that the district must first open a bid for the property.
If the sale falls through, the district is able to sell the land through a
negotiated sale.
"Whether or not we
will do that, I don't know," Boyd said. He would not comment further on
the sale.
Complicating the
situation is a planned levy request for the May ballot. With Dominion Homes
pulling out of the sale, the school board may be forced to put a
permanent-improvement levy on the ballot, said school board President Gary
Tyack.
"I believe it puts
extra pressure on us to consider a permanent-improvement levy," he said.
With the extra $1 million
expected from the Dominion Homes deal, Tyack said he personally felt the
district could delay a permanent-improvement levy for some time.
Boyd said the possible
levy will ask for more money than initially anticipated because the deal fell
through, but the situation will not affect the financial forecast of the
district. As long as the property sells for at least $1.4 million in the next
12 months, Boyd said, the district will be fine.
"We've got some
time," he said.
To make the May ballot,
the school board must determine an amount, submit information to the Franklin
County auditor's office and vote twice before the Feb. 16 deadline.
A public hearing
discussing tax options will be held at
"We'll probably
seriously consider a tax option that night," Tyack said.
Boyd said the district
has had possession of the land since the 1960s and held on to the land in
case the district needed to build another school.
"This is one of the
last pieces of ground available in the school district," Hart said,
"and it's a very high-quality school district."