CANYON CITY After a closed-door session that lasted about an hour, the Grant County Court last week decided to move forward with a possible offer on undisclosed properties from DR Johnsons holdings in the county.

The Court discussed the proposition only in executive, or closed, session last Wednesday, Oct. 27. 

After returning to open session, the Court voted unanimously to authorize County Judge Mark Webb and Canyon City resident King Williams to approach and negotiate with the Johnson family regarding real property owned by Johnson and his affiliated companies.

Interviewed after the meeting, Webb said his intent is to see if we can preserve some critical socio-economic opportunities and protect the countys investment, to the benefit of the community.

However, he declined to elaborate on which properties are of interest to the county, the amount of money involved, or where the money for such a deal would come from.

He said he wanted to approach the Johnson family first to see if they are are interested in an offer from the county. He and Williams planned to make that contact soon.

Webb stressed that the Court didnt authorize a purchase, only an offer, and that more details about the proposal would be made public after discussions with the Johnsons.

Webb said the county is not interested in long-term ownership of any Johnson holdings. Thats not our intent, he said.

In the past year, the Johnson family has sold some portions of their Grant County timberlands. Several more parcels from the 33,337-acre Rudio Mountain Ranch and the 4,685-acre Bear Creek Ranch are up for sale in a Realty Marketing/Northwests fall auction this month.  Sealed bids on those properties are due at 5 p.m. Wednesday, Nov. 17.

John C. Rosenthal, president of the realty auction firm, said last week that hes seeing a good level of interest in the Grant County properties, especially since a recent price reduction. 

The Rudio Mountain property, offered in three parcels, carries a published reserve price of $14.15 million a substantial drop from the last asking price of $27.75 million. The Bear Creek Ranch reserve is $2.45 million.

Rosenthal said one group interested in Bear Creek hails from the East Coast but already owns other property in Grant County, and hes also seeing serious interest in the Rudio Mountain parcels.

He said Realty Marketing/Northwest has sold Johnson properties in the past. The sale parcels consisted of timber and ranch land. The realty firm has not listed any millsites; DR Johnsons Great Western Lumber and Prairie Wood Products mills have been idled during the recession. 

Asked about the prospects for the Johnson mills, he said he thinks the owners, like everybody else, are waiting for the markets to recover.

Rosenthal said the ranch parcels up for auction this month include great hunting territory, as well as some  marketable timber if someones willing to be patient about the markets.

As of last week, the prospective bidders have not included any government entities, he said.

He said its always possible that a party could negotiate a sale directly with an owner prior to the auction. The real estate company would still qualify for commission on any of its listings that might be sold in such a deal, however.

Webb said hes concerned that if the timberlands are sold off, the timber will be lost to community use. In addition, if you lose the mill infrastructure, youre not going to get it back, he said.

Webb said hes had people in the community approach him in the past to see if the county might be interested in buying any of the Johnson properties. It has not come up in a County Court meeting, he said.

In calling the executive session, the court cited an exemption in the states open meetings law that allows public bodies to exclude the public in order to conduct deliberations with persons designated by the governing body to negotiate real property transactions re: property owned by DR Johnson.

Asked if Williams role was to negotiate for the county, Webb said no, but that he had asked him to attend to provide information. He also said Williams was not being paid or compensated by the county for his efforts.

He said he turned to Williams because of his experience in timber and timber industry issues. 

Williams, who was in the closed session last week, confirmed later that he got involved at Webbs request. He said his role is to help Webb put together an offer to take to the Johnsons.

He said he couldnt be more specific because he didnt want to compromise any agreement that might be reached.

Its an economic opportunity, if things work out right, Williams said.

Williams said his motivation to get involved stemmed from concern about the idle infrastructure in the county, and a desire to get something going for the county economically.

I have no financial interest in this at all, he said.

Webb said he did not talk about the issue with Commissioners Scott Myers and Boyd Britton until Wednesdays meeting, and the first they could have known of it was when their Court agenda and notebook materials were provided the previous night. 

Webb said he is cognizant of the publics sensitivity about possible impacts on the property tax rolls, if private land went to public ownership.

Our intent is to maintain the taxing districts, to keep them whole, he said, but he declined to discuss how that would be accomplished.

County Assessor Lane Burton was allowed to sit in on the executive session and emerged with mixed emotions, seeing a double-edged sword in the countys options. He noted that if that Johnson lands continue to be split up and sold, even to private buyers, the county will see reduced property taxes anyway. Small-tract forest lands are assessed differently, with the result being less revenue for the taxing jurisdictions.

County Treasurer Kathy Smith, who was not included in the executive session, said that without knowing the amount of money being discussed, she couldnt say where the Court might expect to find the funds for a purchase. The current years budget is already set, so the countys money is allocated to specific purposes until a next fiscal year begins next July.

Smith said the general fund has an unappropriated ending balance of just $600,000. 

Aside from that, the countys road fund has some $7 million in capital outlay and $2.8 million in transfer funds. That money could be shifted to a land acquisition line item, as long as it still meets the legal requirement that road money be used for roads and schools. Such a shift also would mean an end to road projects for the year, Smith said.

The road reserve holds a sizeable unappropriated ending fund balance $52.8 million but its not easily tapped. Smith said the the county cant use a supplemental budget to spend money from an unappropriated ending fund balance except to deal with a natural disaster, civil disturbance or intential damage and destruction of property.

The Court in recent years has called for building and preserving the funds principle and tapping only the interest to pay for Road Department operations. Smith and Webb referred to that goal in the 2010-11 county budget message:

The Road Departments long-term goal here is to protect the principle in the (Road Reserve Fund), budget for next years operating expenses based on the interest already earned during the prior year, and hopefully add enough to the RRF to handle inflation over time. 

Webb confirmed that mission in an interview last week, and said thats why the county has resisted requests from the cities for money from the fund. The intent is not to run it down, he said.

However, Webb said he feels there should be more ways to invest that money than are allowed now, that would be of greater benefit the county. 

Interviewed last Friday, Britton declined comment on the Johnson land discussion, but said that in general he has long felt the county could find a better way to invest its road dollars than the county investment pool, which has only limited returns.

He also said he felt there was nothing behind the scenes about last weeks Court action, and he has no concerns about having Webb and Williams approach the Johnsons.

Myers also said he felt comfortable with the action taken at this stage.

He said the idea is mostly to look into the legality and whether the road funds could be used in this way. 

If its not do-able, well just stop, he said.