Respondents to ValleCrucis.net indicate a strong preference for the proposed Valle Crucis School to be in Valle Crucis but have serious concern for the $1.1 million tax payer dollars being offered for the Hodges property as the proposed site. This was also a concern mentioned in the public hearing on Sept 3. The more than $78,000/acre for undeveloped land, 90% of which is in the flood plain, is an eye opener for those familiar with land values in the Valle.
The appraisal for this land was equal to the $1.1 million offered for purchase but close examination of the appraisal shows serious flaws. Suffice it to say with more reasonable comparables a generous valuation of the Hodges property would have been $400,000, about 36% of the $1.1 million offered.
Three comparables were used in the appraisal. Most pronounced, comp 1 is not a fair market value (FMV) transaction. The buyer was a Valle Crucis business purchasing just over an acre of flood plain for use of overflow parking (in dry weather). This land was leased and then purchased in early 2016. The non‐representativeness is acknowledged in the appraisal and a small adjustment is made but even at that this is the most expensive acreage of the comps. Comp 1 was not an arm’s length transaction and should not have been included.
Comp 3 (from 2016) consists of three parcels bought by the City of Boone and combined. The parcel number given on the appraisal, 2921‐10‐2179, is of one parcel before the combination. The current parcel number after the combination is 2921‐10‐ 3970. As combined, it is 53.827 acres and is located at 2239 US Hwy 421 South, across from the turnoff for the entrance to the new high school. A creek borders one property line and a small portion of the property, well back from the highway, seems to be in the flood plain. Comp 3 could not be more different than the Hodges site. It is prime commercial property on a busy highway with nothing like the flood plain issues of Hodges. Comp 2 is also problematic—a long way from the Valle and also very dissimilar to Hodges.
Why wasn’t parcel 1970‐89‐7736 suitable as a comp? It is 11.506 undeveloped acres in the Valle that sold at the appraised price of $230,500 in June 2014. I have checked and this was a FMV transaction of approximately $20,000/acre. None of the comps included in the appraisal were recent and this transfer would have been even earlier. However it could be adjusted and even at that would be a fraction of the per acre price of the comps included.
All of this leads me to conclude that the Hodges property is not worth the $1.1 million appraised value. My rough estimate is that at best it is worth at most $400,000, 36% of that given in the appraisal. Additionally, the Hodges property is currently on the tax records for just over $100K. To me this is a problem of fiduciary responsibility on the part of the Watauga County Commissioners and the Watauga Board of Education.
What should be done? A second appraisal needs to be arranged and it should be undertaken by someone from outside the High Country with no professional ties in the area. It’s taxpayer money, isn’t it?
Lyle Schoenfeldt is chair, Steering Committee, ValleCrucis.net.