RCL Information on Conservation Acquisition Hearing Nov. 10th

Notice of hearing:  Click here (hearing to be coincident with BOS meeting)

1.  Former Rand Lumber property of approximately 90 acres was sold for $1.15 million to Wallis Road Properties LLC on April 17, 2013 in a sealed bid sale due to financial issues with the Rand family.

2.  Earlier this year the Planning Board approved a 20 unit Retirement Community Development (“RCD”) on 18.5 acres of that land.  Waivers were granted to increase the sizes of some of the units from 1800 to 2160 sq. ft. and to permit a two car garages even though the Rye Zoning Ordinance restricts RCDs to 1800 sq. ft. and a one car garage.  This development is currently under construction.  Reported prices for the units are $600,000 or higher which would mean developer revenues (before construction costs) of $12 million.

3.  The owner is now seeking to sell the remaining approximately 73 acres to the Town for conservation use.  The Draft Purchase and Sale Agreement (click here) (“P&S”) indicates a purchase price of $1.25 million although the notice does not refer to any price.  While matching funds are referred to in the P&S, no amounts are specified.  The P&S states that “no assessment for hazardous materials has been performed to date.”  However, it permits the Buyer to cancel the agreement if such materials are found.

4.  The acquisition would apparently be paid for using part of the $3 million conservation bond that passed earlier this year with 6 votes more than the needed 60%.  No public hearing on the bond was conducted prior to the Deliberative Session, as required by State law, so HB1124 was passed by the State Legislature, curing the failure.  Bill text: Click here.  Bill docket: Click here.

5.  Funds from an earlier 2003 conservation bond of $5 million have all been spent.  Click here  for detail of disbursements from the latest CIP plan.  Town funds of $5.562 million were matched by $2.901 million from other sources to purchase 367 acres (land or conservation easements) for $8.462 million.

6.  The current CIP plan, page 56 (click here), includes plans for an additional $3 million conservation bond in 2017.  See elsewhere in this Civic News for the summary of the October 23, 2014 Town Budget meeting, where possible depletion of the entire $3 million in 2015 was discussed, and the October 16, 2014 Conservation Commission meeting at which developer Don Cook (currently seeking a subdivision of the Rye Farm at 561 South Rd. from the Planning Board) met with the Conservation Commission in a non-public session for “acquisition.”  Mr. Cook provided assurance at the October 14 Planning Board meeting (see notes elsewhere in this Civic News) that the back portion of the 35 acre parcel would remain undeveloped.

7.  Both the Selectmen and the Conservation Commission must approve conservation acquisitions under State law.  Click here  for the Selectmen’s policy on required documents.  The complete set of the documents prepared for this acquisition pursuant to this policy are available from Janice Ireland at Town Hall.

8.  An appraisal Click Here for $2.265 million was obtained by the property owner.  There is no evidence of an independent appraisal having been performed for the Town.

     a.  The appraisal assumes a value of $400,000  per lot, and cites seven comparable sales ranging from $335,000 to $420,000 in value and averaging $368,429.  Click here for comps.  The only parcel selling for $400,000 or more is close to Foss Beach.

     b.  For valuation purposes 16 lots are assumed (click here for map), with a 3650 foot road connected to Wallis Rd. and crossing the wetlands in two spots.  The appraisal recognizes that development would require variances for a dead end street more than 600 feet long and for a dead end street serving more than 10 lots.  The dotted areas on the map indicate wetlands.

   c.  The developer’s appraiser did a detailed cash flow calculation showing a $2,162,096 net present value supporting its appraisal (click here).  “Entrepreneurial profit” of $1,723,000 is included in the calculation.

9.  There is no evidence that test pits were obtained for the back parcel to be acquired, or that a 2008 wetlands delineation for that portion of the parcel was updated.  The appraisal appears to assume that the wetlands delineation is correct, and also that each lot would support a septic system.