THE MONEY TRAIL
Sacramento may have paid way too much for depot
Two years ago, when times were better, the city gave Thomas Enterprises a financial assist to help the developer close on its purchase of the downtown railyard from Union Pacific.
In emergency session, the City Council agreed to pay $55 million for the historic I Street depot and 8 acres.
Although there wasn't evidence the land and station were actually worth that much, the parties said they'd settle up later through negotiations or mediation.
Now the city faces its own $50 million budget gap, and two appraisals found the land is worth far less than the city paid.
"My view is we overpaid and we really didn't have a system in place to get our money back," Councilman Kevin McCarty said. "It's a lot of money we're talking about, and we're not holding the pedal to the metal."
Councilman Rob Fong agreed, saying the city appraisals concluded it overpaid by at least $40 million. "We need to move quickly on this, and I don't know what's taking so long," Fong said.
Assistant City Manager Marty Hanneman said the issue is going to mediation. "If mediation isn't successful, we'll go into binding arbitration," he said. "Our goal is to have this done in June or July."
He said the feds required two appraisals, which slowed the process.
Most of the $55 million came from Measure A transportation funds and couldn't be used to fill the city's budget gap, Hanneman said. He estimated $5 million could be appropriated for other purposes.
– Mary Lynne Vellinga. Send tips to moneytrail@sacbee.com
ON YOUR GUARD
DA's offices investigate firm's tax relief claims
Property owners beware, says Ken Stieger, the Sacramento County assessor.
A Southern California company has been blanketing the area with official- looking forms promising to help homeowners get their property tax bills reduced, all for the low, low price of $95.
The forms from Homeowners Tax Review in Pasadena tell owners that they need to respond "NO LATER THAN 2/11/09."
But Stieger says it's too late to appeal last year's assessment, and owners can't begin to appeal next year's until July. By then, the assessor will review property assessments for free at a homeowner's request.
Stieger notified the Sacramento County district attorney about the company, and it's working with the Los Angeles DA's office to investigate.
One of the company's owners, Jeff Moffat, defended the mailers. "We're not a scam," Moffat said. "We provide a service to our clients."
Moffat, who operates a law firm specializing in captive insurance (a regulated form of self-insurance) out of the same address as HTR, doesn't think the mailer looks like a tax bill and said the form says the company is not a government agency. That disclaimer is in smaller font than surrounding type.
For more information, see www.assessor.saccounty.net.
– Robert Lewis. Send tips to moneytrail@sacbee.com
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