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TO: |
Board of Trustees |
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THROUGH: |
Jay Fox, Executive Director |
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FROM: |
Mary DeLoretto, Chief Service Development Officer |
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PRESENTER(S): |
Paul Drake, Director Real Estate & TOD |
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Spencer Burgoyne, Mgr. Property Administration |
TITLE:
title
Contract: OGX Parcel 129 Property Settlement Agreement (Rehman Family Properties #2)
end
AGENDA ITEM TYPE:
Non-Procurement Agreement
RECOMMENDATION:
Approve and authorize Executive Director to execute the attached settlement agreement and associated disbursements with Rehman Family Properties #2, LLC in the amount of $219,600
BACKGROUND:
The UTA has been acquiring right-of-way for the Ogden-WSU BRT Project (OGX) to connect Ogden FrontRunner Station to Weber State University and McKay-Dee Hospital. Along Harrison Boulevard, next to 35th Street, UTA purchased a strip of land and a construction easement from a restaurant property operating as Big Jim’s Burger. This property is owned by Rehman Family Properties #2, LLC. Based on the appraised value, UTA offered the owner $51,600. UTA and the owner negotiated and settled the acquisition for $57,600 in May 2021.
In September 2021, the owner sent a letter to UTA claiming that he did not know that a center median would be constructed in Harrison Boulevard blocking left-turn access onto 35th Street. Southbound traffic would be unchanged. However, patrons traveling northbound would have to travel three blocks to make a U-turn on 32nd Street. During our investigation into the claim, the appraiser admitted that he did not realize the full impacts and would have concluded damages beyond the land value given the retail use.
UTA staff requested FTA guidance on the issue. FTA advised UTA to reappraise the property and to have the UTA attorney review the legal issues of the claim and determine the most reasonable and prudent course of action.
The owner agreed to not file a lawsuit until a new appraisal could be completed by a new appraiser. The new appraisal, completed by Jeremie Snowder, MAI, concluded a value of $219,600 for the land and severance damages. UTA had this appraisal reviewed by David Holtby which he recommended as reasonable and supported.
During negotiations, the owner requested a settlement at $419,000, which was rejected. However, the owner finally agreed to settle for a total award of $219,600 subject to FTA concurrence and UTA Board approval.
DISCUSSION:
The UTA real estate and legal staff have reviewed this issue extensively. The project appraiser admitted to not fully considering the impacts of the taking. This is supported by the new appraisal by Jeremie Snowder and the review appraisal.
FTA provided a concurrence letter making the settlement reimbursable under the grant.
UTA risks additional legal costs and a potentially higher award by not settling the matter and letting the owner sue UTA.
UTA staff recommends approving this settlement agreement for $162,000. Since the owner was already paid $57,600, the total award for the acquisition is $219,600.
This is UTA Contract # 22-P00200
ALTERNATIVES:
If the agency does not settle, the owner may sue UTA.
FISCAL IMPACT:
The acquisition would cost an additional one-time payment of $162,000. This amount is in the project contingency budget.
ATTACHMENTS:
1) Settlement Agreement
2) FTA Concurrence Letter
3) ROW maps