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Sale of surplus city real estate

From the Mayor's Desk

March 24, 2012
By Mayor Duke Talbott , The Inter-Mountain

The city of Elkins owns several pieces of real property that are getting little use at the present time. These include the former City Garage on 11th Street, the gravel lot facing the railyard developments behind City Hall, and the sludge pond for the former Reidboard garment factory. With the completion of the new water plant, the old water plant on Barron Avenue also will be vacant and unused.

At its regular meeting on March 1, Elkins City Council directed the Municipal Property Committee chaired by Councilwoman Nanci Bross-Fregonara, 4th Ward, with members Councilman Bob Woolwine, 1st Ward, and Jim Bibey, 5th Ward, to begin reviewing the better utilization of unused city properties. Included within the parameters of that directive are the possible sale or other reuse of those properties.

The city's ownership of real estate that is used for only marginal purposes or not at all is counterproductive and costly. Because of the way the state's municipal tax system is set up, such holdings penalize a number of entities when left unused.

According to state law, if a property is held by any level of government, it is removed from the property tax rolls. As a result, the city loses any tax revenue that might accrue if the property were privately owned. Because of the tax exemption, both the Randolph County Board of Education and the Randolph County Commission also lose revenue. In addition, if the property is such that it has economic development potential, any jobs that could be created by placing the property under private ownership are lost also.

A further spin-off is that any business that would be located on the property would be subject to Business and Occupation tax as well as the 2 percent utility tax. Both of these are given up as long as the property remains owned by the public weal. Additionally the state foregoes any potential income tax from the property.

Failure to develop these properties may mean - because of the shortage of developable land in our state - that the project does not take place at all or it is located in another area. Some of the land the city holds is prime commercial property and should be made available for such development. Holding on to this property for whatever reason is simply adding another impediment to our economic development efforts. These properties are largely flat, located in prime locations, and provided with all utilities and transportation access.

Some citizens have argued that the city should hold on to these properties in case they are needed at some future time. Certainly at some point in time the city will need additional property, but the nature and location of such land is completely unknown at the present time. In light of the rapidly changing technological, transportation and communication patterns of our time, the type of property that will be needed is impossible to ascertain in the present.

An effort to efficiently and effectively acquire property that would meet the needs of some unknown future requirement is sheer speculation. The purpose of the municipality is not land speculation. That is something better left to the private sector where individuals knowledgeable in the art have had years of practice in second guessing what might be needed at some future time.

Rather, as property becomes available or is underutilized, the city should have it appraised and put up for public sale. If it is thought some restrictions for a particular property may enhance the neighborhood or make the property more desirable, then covenants for that purpose can be incorporated into the sale.

Failure of the city to rapidly and effectively dispose of underutilized property not only hurts the citizens through loss of taxes and economic development opportunities, it also harms the school system and the activities funded by the county commission. In addition, to the extent that jobs could be created through optimal use of the property, continuing to hold on to such pieces of real estate deprives individuals from potential jobs and other economic development functions which are so necessary for a thriving economy.



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