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    DAV Condemnation Order - Ward 2021 Nov

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    © All Rights Reserved
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    796 views19 pages

    DAV Condemnation Order - Ward 2021 Nov

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    WKRC
    DAV Condemnation Order - Ward 2021 Nov

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    ENTE | CAMPBELL CIRCUITFAMILY/DISTRCT NOV 23 2021 COMMOWNWEALTH OF KENTUCKY CAMPBELL CIRCUIT COURT DIVISION NO. ONE t CASE NO. 20-CI-926 CAMPBELL COUNTY BOARD OF EDUCATION —_ PETITIONER v. DISABLED AMERICAN VETERANS, INC. RESPONDENT v. CITY OF COLD SPRING, KENTUCKY INTERVENING RESPONDENT —— ORDER On October 6, 2021, the parties and counsel were before the Court on Petitioner's (hereinafter “the Board”) right to take. Before the hearing, the Board orally moved to dismiss the Disabled American Veterans, Inc (hereinafter “DAV”) as a party on the basis that after the Petition for Condemnation was filed the City of Cold Spring, Kentucky (hereinafter “City”) purchased DAV’s real estate commonly known as 3725 Alexandria Pike, Cold Spring, Kentucky (hereinafter “Property”). All parties agreed with the dismissal. The Court sustained the motion to dismiss. After making brief opening remarks, the Board called four witnesses: Dr. David Rust, Superintendent of the Campbell County School District; R. Ehmet Hayes, an architect with R. Ehmet Hayes and Associates and the architect for the Board; Todd Allen, Esq., general counsel of the Kentucky Department of Education (hereinafter “KDE”) and the Kentucky Board of Education; and Steve Taylor, City Administrator for the City. ARer the Board rested its case, the City called one witness: Daniel Ruh, Esq., a non-practicing attorney and President of Al Neyer, LLC, a real-estate development firm. The parties introduced the following exhibits: Board: Exhibit 1, Dr. Rust Email to Mark Burgess (July 2019); Exhibit 2, Dr. Rust Board Update (July 2019); Exhibit 3, Email Chain with Barry Jesinoski; Exhibit 4, Architect Estimates for Construction and Renovation of DAV Property; Exhibit 5, Letter to Peter Snow with Board’s Second Offer; Exhibit 6, Proposed Purchase Agreement Between DAV and the Board; Exhibit 7, Fort Thomas Matters Article (December 4, 2020); Exhibit 8, Emails from Daniel Ruh to Board Members (December 14, 2020); Exhibit 9, Mayor Penque Facebook Post (December 14, 2020); Exhibit 10, Fort Thomas Matters Article (December 14, 2020); Exhibit 11, Petition for Condemnation; Exhibit 12, Plat of Properties/Tracts at Issue; Exhibit 13, Kentucky Department of Education Letter granting the Board Final Approval for Acquisition of the DAV Property; Exhibit 14, Kentucky Department of Education, Office of Legal Services, Recommendation to Board; Exhibit 15, Kentucky Board of Education Agenda (October 5, 2021); Exhibit 16, Steve Taylor Email re: IWORQ Inquiry (August 2020); Exhibit 17, Fort Thomas Matters Article (October 1, 2021); Exhibit 18, Fort Thomas Matters Updated Article (October 1, 2021); Exhibit 19, Daniel Ruh email to Steve Taylor re: financial benefits of proposed development (December 17, 2020); Exhibit 20, Daniel Ruh email to Pat Crowley (December 20, 2020). City: Exhibit A, Original Deed to DAV; Exhibit B, Email from Gary Leist to David Rust (December 14, 2020); Exhibit C, Excerpt of KY Administrative Regulations, Facility Programs Manual; Exhibit D, Kentucky Department of Education Letter (July 23, 2021); Exhibit E, Resolution No. 21-02 (Passed March 29, 2021); Exhibit F, Deed from DAV to City of Cold Spring (April 8, 2021), After hearing testimony and argument, the Court makes the following Findings of Fact and Conelusions of Law: STIPULATIONS 1. City stipulated that they are the proper Defendant having purchased the Property on April 8, 2021. The Board accepted the stipulation. 2. City stipulated that it sought to purchase the Property to prohibit the Board from using its power of eminent domain. The Board accepted the stipulation. 3. The City stipulated that the Board was a public entity and that a new middle school was a legitimate public use. 4. The parties stipulated to R. Ehmet Hayes’ qualifications as a licensed architect practicing in the Commonwealth of Kentucky and that Mr. Hayes qualifies as an expert. FINDINGS OF FACT DAV purchased the Property from the Campbell County Business Development Corporation (“CCBDC”) in 1965, subject to provisions set forth in a contract between the CCBDC and the City of Cold Spring. On March 1, 1963, the City of Cold Spring and the CCBDC entered into an agreement regarding the use and development of the Property. City’s Exhibit A. The agreement stated that the CCBDC was established to “promote, stimulate, develop, and advance the business prosperity and economic welfare of Campbell County, Kentucky, and its citizens; to encourage and assist through loans, investments or other business transactions, in the location of new business and industry; and so to stimulate and assist in the expansion of all kinds of business activity which will tend to promote the business development and maintain the economic stability of this County, provide maximum opportunities for employment, encourage thrift, and improve the standard of living of the citizens of this County; similarly, to cooperate and act in conjunction with other organizations, public or private, in the promotion and advancement of industrial, commercial, agricultural and recreational developments in this County ....” City's Exhibit A. The Agreement provides for 14 separate restrictions regarding the future use and development of the Property for the purposes of ensuring that the Property is reserved for economic development. In relevant part, the agreement purports to limit ingress and egress to connect only to U.S. 27, even though there currently exists a third access point on Industrial Road. The Campbell County, Kentucky middle school is the third largest middle school in Kentucky with a population of over 1200 students. Ideally, a middle school should have about 600-700 students. For the last ten years, because of the population size of the current middle school, the Board has been looking for a suitable location to build a second middle school. Dr. Rust investigated several sites for a second middle school including the Beverly Hills Supper Club site and Campbell County Boys Lodge. These sites were not acceptable for many reasons including. cost and topography. The Property had been previously considered an appropriate potential site, but Dr. Rust did not believe the Board would authorize the use of eminent domain and force the DAV to relocate. In the spring of 2019, Dr. Rust heard that DAV planned to move its headquarters. In July 2019, Mare Burgess, the CEO of DAV, confirmed that DAV was downsizing and were going to sell the Property and relocate, Mr. Burgess was not prepared to discuss the sale of the Property at that time, Dr. Rust shared this information with Campbell County School Board members (hereinafter “Members”). Berry Jesinoski arranged for the Board to tour the Property, and the Board held a special board meeting at the Property to enable a tour of the Property by Members. The special board meeting/tour took place in September 2020. Mr. Jesinoski, Members, Dr. Rust, and the Board's architect, Emhet Hayes were present. The Board was interested in purchasing the Property for the purpose of a second middle school. Out of all the sites toured by the Board, the Property is the most promising because of its location, topography, condition, and multiple access points. The location would allow students that are currently transported from the North end of the County to have a shorter bus ride, Buses and parents could enter and exit in a different location from each other, Buses could potentially be stored on site, saving additional travel time. In addition, based on Mr. Hayes’ calculation prepared following the tour, renovating the Property versus building a new school would save the Board approximately 7 million dollars. Therefore, the Board made a confidential offer to purchase the Property for 5 million dollars. This offer was not rejected, nor did DAV make a counteroffer. Rather, DAV’s realtor, Peter Snow contacted the Board and told them to make their best and final offer by October 30, 2020. Although Dr. Rust did not have the Property appraised, he knew that Mr. Snow valued the Property around 4-5 million dollars. Based on the tour and Mr. Snow’s valuation of the Property, the Board made a second confidential offer to purchase the Property for 6 million dollars on October 30, 2020. The offer was accompanied by a letter from the Board’s chairperson that if an agreement could not be reached the Board might seek to condemn the Property. The Board was not made aware until November 30, 2020, that DAV had accepted another offer for a purchase price of 6.5 million dollars and entered into a contract on November 13, 2020. It was not disclosed who purchased the Property. On December 10, 2020, the Board posted the agenda for its regularly scheduled December 14, 2020, meeting. The agenda included the need for an executive session to discuss eminent domain of the Property. On December 11, 2020, Dr. Rust was contacted by Dan Rub, President of Al Neyer LLC, the purchaser of the Property. Mr. Ruh requested a meeting with Dr. Rust and the Board’s Chair. The meeting was held on December 14, 2020. At the meeting, Mr. Ruh attempted to persuade the Board’s Chair and Dr. Rust to forgo the use of eminent domain on the Property. Atits December 14, 2020, regular meeting, the Board approved the acquisition of the Property and directed Dr. Rust to consult with a lawyer regarding condemnation proceedings. In November 2020, Steve Taylor and the Mayor met with Mr. Ruh, President of Al Neyer, LLC. Mr. Ruh discussed purchasing the Property potentially with St. Elizabeth to develop a ‘medical facility and whether the City would be able to assist with overcoming any deed restrictions ‘or zoning issues reflected in the chain of ttle. Mr. Ruh did not ask the City to buy the Property but did ask if the City had an interest in assisting with the development. It was not specified how the City could assist in developing the Property. Mr. Ruh was told that more information would be needed before an answer could be provided. Mr. Taylor later leaned that negotiations are also ongoing with Children’s Hospital as a potential tenant for the site. On December 17, 2020, the City conducted a special meeting and authorized the Mayor and city attorney to negotiate for the purchase of the Property. On December 20, 2020, City Council approved the purchase of the Property in executive session. On December 20, 2020, the Board filed a condemnation proceeding. Board’s Exhibit 11. That same day, Al Neyer, LLC entered into a purchase agreement in which Al Neyer, LLC assigned its rights to purchase the Property to the City, and in exchange Al Neyer would develop the Property. On December 21, 2020, the Board recorded and filed a lis pendens. On April 8, 2021, the City took legal title and obtained a warranty deed to the Property. The purchase price was 6.5 million dollars but only 5.5 million was paid to DAV, the rest is in escrow dependent upon the outcome of this lawsuit. The City secured financing for the purchase, centering into an interest-only note for two years. On September 30, 2021, the closing took place. Under the agreement, Al Neyer, LLC is to pay for the operating costs within thirty days or it will lose its right to develop the Property and the City will be responsible forthe interest only payments. The City purchased the Property in an effort to circumvent the Board from acquiring the Property by eminent domain. The Property was purchased for economic development, but the City intends to sell the Property to Neyer or another private developer. There is no evidence that the City intends to use industrial revenue bonds or other government funding to finance the Property. ‘AfRer the filing of the condemnation action, the Board began the process of complying with the KDE requirements, set forth under 702 KAR 4:050, to acquire the Property. KDE is the state regulatory agency for all public K-12 schools in Kentucky. To acquire property for a school, a school board must get approval from KDE. The Board does not need permission from KDE to file an eminent domain action. The Board has funds to purchase the Property without borrowing money. The Board works with Ehmet Hayes to ensure that potential building sites would be suitable for a new school. In doing so, Mr. Hayes considers the grade level, enrollment size and the nature of the curriculum to be taught. Additionally, he makes sure the potential sites have appropriate acreage and square footage requirements based on the age levels of the students and occupancy. He also considers topography and site access, including how a bus can navigate through the sites. He has assisted the Board in looking at approximately 15 different sites for a new middle school, elementary school and high school. Some of the sites included the Campbell County Boys Lodge, Crossroads, and the Beverly Hills Supper Club. The cost, topography of these sites, and access issues made the sites undesirable. Along with others he toured and inspected the Property. He inspected the roof, the age of the building, looked for settling and cracking, and considered any need for asbestos abatement. The Property would be suitable for a new middle school. After the tour he worked with an engineering company called Viox. They conducted a topographical survey of the Property and developed a rendition of the Property. Viox reviewed the deeds and restrictions. Mr. Hayes then worked to make sure all KDE requirements would be met. ‘He reviewed the regulation under 702 KAR 4:050 which requires that all school buildings must be 200 feet from any high-pressure gas lines. This requirement can be met by removing a small portion of the back of the existing building. ‘The Property currently has three access points, two on Alexandria Pike (U.S. 27), and one on Industrial Road. However, there is a deed restriction on the Property which may limit access to and from the Property orito Alexandria Pike. Even if access is limited to only the two access points on Alexandria Pike, the Board will still be able to develop the Property in compliance with the KDE requirements. The City is responsible for the management of storm water runoff in the City, including the Property. Although, KDE does not review storm water compliance, Mr. Hayes believes that the Board will be able to work with the City to get all appropriate permits for storm water runoff. The Board worked with KDE to acquire the Property. One requirement was a title search, which a 60-year title search was conducted and was satisfactory to KDE. On September 20, 2021, the Board was given approval by KDE to acquire the Property on the condition that they resolve ‘two issues, which needed the Kentucky Board of Education’s approval/waiver. On October 5, 2021, the Kentucky Board of Education met and granted the waivers requested and gave the Board approval to acquire the Property. CONCLUSIONS OF LAW ‘The Petitioner, Campbell County Board of Education (“the Board”), filed an in rem condemnation petition pursuant to KRS 162.030 on December 20, 2020. On December 22, 2020, Pursuant to KRS 416.580, the Court appointed three landowners of Campbell County to serve as Commissioners to report on the amount of compensation to be awarded for the taking of the real Property described in the Petition. The Commissioners retumed the Report and Award on January 21, 2021. On January 22, 2021, the Campbell County Circuit Clerk issued a summons to Respondent, DAV, and service was perfected on or about January 27, 2021. DAV challenged the Board’s right to take the Property by filing a Motion to Dismiss on February 15, 2021. On February 10, 2021, the City of Cold Spring, Kentucky (“City”) was granted the right to intervene based upon an Assignment of Purchase Contract between the City and private developer, Al Neyer, LLC. After intervention was granted, the City also moved to dismiss the Petition. While the motions to dismiss were pending, the City purchased the Property and obtained a warranty deed on April 8, 2021, making the City a proper Respondent. The motions to dismiss were fully briefed and denied by the Court. An evidentiary hearing on the Board’s right to take was scheduled for October 6, 2021. Prior to the hearing on the right to take, DAV was dismissed as a party Respondent upon the Board’s oral motion. The City did not object, and the Court sustained the motion. Petitioner is a public board of education existing and operating pursuant to KRS 160.160, responsible for the education of students residing within the Campbell County school district Pursuant to KRS 160.010. Section 183 of the Kentucky Constitution sets forth the purposes of Petitioner as a board of education, which includes providing “for an efficient system of common schools throughout the state.” The Petitioner also has the authority to make contracts, purchase, receive, hold, and sell real property, and do all things necessary to accomplish the purposes for which it was created. KRS 160.160(1). School districts have broad discretion with respect to where they choose to locate schools within their district boundaries. Pike Co. Bd. of Ed. v. Ford, 279 S.W.2d 245, 247 (Ky. 1955). However, acquisition and construction of property is subject to regulatory review and approval of the Kentucky Department of Education (“KDE”). 702 KAR 4:050. In accordance with KRS 162.030, Petitioner has the power of eminent domain. The Kentucky Constitution and Eminent Domain Act of Kentucky (KRS 416.540 et seq.) require that the taking of property must be reasonably necessary for a valid public use. No one disputes that the Board is seeking the Property for a public use. The City first argues that the Property is already devoted to a public use and thus, cannot be condemned by the Board for another public use. Generally, land devoted to one public use cannot be taken for another public use. Kipling v. City of White Plains, 80 S,W.3d 776 (Ky. Ct. App. 2001). The City maintains that the development of a hospital is a public use and cites to Craddock v. University of Louisville, 303 8.W.2d 548, 551 (Ky. Ct. App. 1957), in support of this position. In Craddock, the Court determined that it was not unconstitutional for the University of Louisville to lease land which it acquired by eminent domain for the construction of a hospital. The University of Louisville acquired title to the site in the name of the university. The site was then leased to the hospital upon the agreement that the hospital would construct a teaching hospital in connection with the university's school of medicine. The Court found that the purpose of expanding the teaching and training facilities of the medical school was a legitimate public purpose. 303 S.W.2d 548 (Ky. Ct. App. 1957). The present case is distinguishable from Craddock. While no one disputes that the City intends to use the Property for economic development, which is a valid government function, the Property is not currently, nor in the past has it been used for a public purpose. The Kentucky Supreme Court has examined the phrase “public use” and determined that for the purpose of condemnation, a public use is not equivalent to property held for public benefit. See Chesapeake Stone Co. v. Moreland, 126 Ky. 656, 31 Ky. L. Rptr. 1075, 104 S.W. 762, 765 (1907); City of 10 Owensboro v. McCormick, 581 8.W.2d 3 (Ky. 1979). In this case, there is no school partnering With Neyer or St, Elizabeth to construct a teaching hospital. Rather, it is a private enterprise. The Property was previously owned by DAV, a private entity. The Property was subsequently sold to Neyer, also a private entity, who then assigned those purchase rights to the City. Hence, the Property was not previously being used for a public use. The City purchased the Property for the purpose of trying to prevent the Board from condemning the Property in the hope that it will be able to generate increased taxes though a sale to a private developer which it intends to do in the near future. Thus, the Property is not being used or held for public purposes. The City further argues that the Property is now publicly owned property and the Board’s power of eminent domain is limited to condemnation of privately-owned property. Specifically, the City argues that KRS 162.030 does not expressly authorize the Board to condemn public property and that KRS 416.540(1) only permits the taking of private property for public use. Moreover, the City contends that these statutes are not in conflict and there is no need to harmonize them. The Court disagrees. In construing statutes, courts must give effect to the intent of the General Assembly. When. statutes are seemingly inconsistent, the court must presume that the legislature intended for the statute to be construed as a whole, for all its parts to have meaning, and for it to harmonize with related statutes. Campbell County Library Board of Trustees v. Coleman, 475 .W.3d 40 (Ky. Ct. App. 2015). Here, the Court is confronted with overlapping statutes pertaining to the right of public- school boards to exercise eminent domain. KRS 162.030 provides: Each board of education may, when unable to make a contract satisfactory to the board with the owner for the purchase of real estate to be used for school purposes, initiate condemnation proceedings pursuant to the Eminent Domain Act of Kentucky (KRS 416.540 to 416.670), and the title to land so obtained shall be vested in fee simple. 1 KRS 416.540 provides definitions for the Eminent Domain Act of Kentucky. The Act provides, in relevant part: (1) “Condemn” means to take private property for a public use under the right of eminent ®) Proper ‘means rel or personal property, or both, of any nature or kind that is subject ‘to condemnation.” The plain reading of KRS 162.030 does not limit condemnation to only private property. In addition, nothing in Kentucky law indicates that the legislature intended to mandate that property must be private in order for a school board to exercise its power of eminent domain. Rather, the Statute states that after the board is unable to make a contract satisfactory to the board with the ‘owner for the purchase of real estate to be used for school purposes that the board may initiate condemnation proceedings pursuant to the Eminent Domain Act of Kentucky. While the City points only to KRS 416.540(1) and (8), when reading KRS 162.030 as a whole, the statute specifically states that a board may initiate condemnation proceedings pursuant to the Eminent Domain Act of Kentucky. Thus, KRS 162.030 must be construed along with the entirety of the Eminent Domain Act and not just the specific portions mentioned by the City. KRS 162.030 references the Eminent Domain Act when describing the nature of the procedural processes to be followed when a condemnation proceeding is initiated. Although KRS 416.540(1) defines condemn to mean the taking of private property for public use, this definition taken alone does not relate to the nature of initiating condemnation proceedings as referenced in KRS 162.030. This Court interprets “initiate condemnation proceedings pursuant to the Eminent Domain Act of Kentucky” to pertain to the processes outlined in the Act that must be followed such as filing a verified petition in the Circuit Court of the county in which all or the greater portion 12 of the property sought to be condemned is located, describing the property sought to be condemned and the proposed use, the appointment of three commissioners, issuing of summonses, and holding of an evidentiary hearing on the right to take if the petitioner’s right is contested. ‘Nevertheless, even if the Board's power of eminent domain is limited solely to the condemnation of private property, the Court believes that in essence, the Property at issue is not public property. There is no dispute that the City owns the Property and that the City is a public entity. However, looking beyond the mere character of ownership, the Court cannot ignore that the facts demonstrate that the use to which the Property will be dedicated upon the conclusion of the condemnation proceedings, as well as the ownership of the Property if the outcome is in the City’s favor, will be private. In sum, the evidence does not support that the City executed the purchase of the Property in furtherance of issuing IRB’s or other governmental funding to support development of the Property. Rather, the Court believes that the City is acting as a straw man and that the City bought the Property to circumvent the Board’s taking of the Property through eminent domain and is only holding the Property for Neyer or another private entity until the conclusion of these condemnation proceedings, at which time the City plans to sell the Property to Neyer or another private developer. Next the City argues that the Board has failed to show that there is a need to take the subject Property. Generally, the condenining body has broad discretion in exercising its eminent domain authority including the amount of land to be taken. Lexington-Fayette Urban County Government ¥Moore, 559 8.W. 3d 374 (Ky. 2018). A determination by the condemnor on the amount of land it requires for present and future needs will be disturbed only if it is unreasonable in relation to the public interest involved. Id. The condemnor’s determination as to the necessity of the taking is ordinarily conclusive but remains subject to judicial review for arbitrariness or action exceeding 13 its authority. God’s Center Foundation, Inc. v. Lexington Fayette Urban County Government, 125 S.W.3d 295, 299-300 (Ky. App. 2002). Arbitrary means clearly erroneous and clearly erroneous means unsupported by substantial evidence. Hilltop Basic Res., Inc. v. Cty, of Boone, 191 S.W.3d 642, 646 (Ky. Ct. App. 2006). Here, the Board demonstrated a need for anew middle school. Campbell County currently only has one middle school. Dr. Rust testified that the Board has been in search of a suitable property that could be used for a second middle school for years. Further, Dr. Rust stated that the existing middle school currently has a population of over 1200 students and that the county is continuing to see growth. Dr. Rust testified that the ideal number of students would be between 600-700. The Court believes the evidence supports the Board’s need for a second middle school. ‘The Board has also demonstrated a necessity for taking this particular Property. Testimony from Dr. Rust and Ehmet Hayes demonstrated that the Board has considered several other sites for anew middle school, but cost and topographical issues rendered those properties unsuitable. They also testified that the subject Property is the most promising due to the topography, access points, and estimated cost savings from renovating the existing DAV building versus new construction. Dr. Rust also testified regarding the Board’s long-term interest in the subject Property but noted the Members’ reluctancy to authorize the Board to exercise its power of eminent domain to displace the DAV while they were still occupying the building. Thus, it wasn’t until the Board Jeamed that DAV would be relocating that the Board was seriously able to contemplate taking the Property. The Court believes that the Board has demonstrated a reasonable necessity to condemn this Property. ‘The City further argues that the Board has not demonstrated that itis necessary to condemn the entire subject Property. Dr. Rust and Ehmet Hayes testified that the Board intends to renovate 14 the existing DAV building. While the City contends that the gas line on the Property will preclude the Board from being able to use the remainder of the Property, no evidence was presented that supports this contention. Further, Dr. Rust testified that the size and nature of the Property was particularly appealing because in addition to renovating the existing building for a new middle school, the Property might also allow busses to be stored on site. The Court believes that the Board is not required to have definite plans for every inch of the condemned land. Rather, the evidence that the Board intends to renovate the existing building as well as explore the possibility of using the remainder of the land for other school facilities such as playgrounds and bus storage, is sufficient to demonstrate a reasonable necessity for the entirety of the Property, Next, the City maintains that the Board failed to negotiate in good faith because it did not have the Property appraised prior to initiating condemnation proceedings, and because the Board’s final bid contained language that they would initiate condemnation proceedings if the DAV did not accept their offer. Whenever any condemnor cannot, by agreement with the owner thereof, acquire the property rights, privileges or easements needed it has the right of eminent domain, KRS 416,550. A condemnor has an obligation to negotiate in good faith for the purchase of the property prior to filing an eminent domain proceeding. _God's Ctr. Found., Inc. v. Lexington Fayette Urban Cty. Gov't, 125 8.W.3d 295, 299-300 (Ky. Ct. App. 2002). A condemnor is not required to haggle in order to satisfy its obligation to negotiate in good faith. Coke v, Comm. Dept. of Finance, 502 8.W.2d 57, 59 (Ky. 1973). In Milam v. Viking Energy Holdings, LLC, 370 8.W.3d 530 (Ky. Ct. App. 2012), the Kentucky Court of Appeals found that the oil company attempted to engage in good faith negotiations prior to initiating condemnation proceedings. The final offer from the oil company contained a letter stating that the company would have no choice but to initiate condemnation 15 proceedings if the Milams did not agree to the terms. The Court held that this letter did not negate 00d faith negotiations and that even though the oil company refused to discuss the matter further after their counteroffer was rejected, the company still negotiated in good faith. Furthermore, the Court determined that company was not required to obtain an appraisal prior to bringing the condemnation petition. Id. at 536. Similarly, in the present case, the Board was not required to have the Property appraised before engaging in negotiations with DAV. Here, after consulting with DAV’s real estate broker, Peter Snow, regarding his valuation of the Property, which was between $4,000,000.00 and $5,000,000.00, the Board made an initial offer of $5,000,000.00. The Board was asked to submit their highest and best offer by October 30, 2020, at which point they submitted a final bid of '$6,000,000.00. No one told the Board that their offer was not appropriate. No counteroffers were made, and DAV made no effort to negotiate. Although the Board’s second offer included language that they would potentially resort to condemnation if the offer was not accepted, the Board attempted to buy the Property at a reasonable price and made multiple offers to do so. The Board ‘was not given an opportunity to match the winning $6,500,000.00 number because this number was not provided to the Board until after DAV had already accepted Neyer’s offer and entered into purchase contract. In fact, the Board was only informed that the DAV sold the Property to another bidder for 6:5 million dollars after Dr. Rust, having received no counteroffer or rejection of the Board’s offers, called Peter Snow. Thus, the Court believes that the Board engaged in good faith negotiations. Finally, the City argues that the Board has failed to provide reasonable assurances that the intended use will come to pass. Kentucky law provides that where there is a reasonable assurance that a project will come to pass, the right of condemnation will be granted. Northem Kentucky 16 Port Authority, Inc. v. Comett, 625 8.W.2d 104, 105 (Ky. 1981). The law recognizes that it is not conceivable that all phases of development be simultaneously completed. Id. If there is a reasonable probability of the issuance of necessary permits, there is a right of condemnation. Id. Based on the evidence presented, the Court believes that the project will come to pass. Todd Allen testified that a school board is not required to obtain approval from KDE prior to filing a petition for condemnation. However, under 702 KAR 4:050, acquisition and construction of property is subject to regulatory review and approval of the Kentucky Department of Education. Ehmet Hayes testified that he worked with the Board and KDE to ensure that the Property would be in compliance with 702 KAR 4:050. Todd Allen testified that the Board complied with all regulations and the Board was given approval from KDE to acquire the Property. Furthermore, Mr. Hayes is experienced in designing K-12 schoo! buildings and is very familiar with the regulations. While the Property is not 200 feet from the gas line as required, a small portion of the back of the building can be removed in order to bring the building into compliance. Mr. Hayes stated that after acquiring the Property, the Board will need to obtain approval from KDE before beginning construction. The Court has no reason to believe based on the testimony and evidence presented that Mr. Hayes and the Board will be unable to obtain final approval from KDE to construct the new middle school. Dr. Rust testified that the Board has the capacity to pay the costs associated with acquisition. Thus, the Court believes the condemnation is for school purposes and that the Board has provided reasonable assurances that the intended use will come to pass. Lastly, the City maintains that the Board’s plan to condemn the Property to use as a new middle school is precluded by the land use restrictions contained in the 1963 Agreement. DAV obtained the three deeds to the Property in 1965 totaling 30.222 acres of land. The deeds contained 7 language that DAV and subsequent purchasers would be subject to the 1963 Agreement restrictions to ensure that the Property be used for the purposes of economic development. Although a middle school would likely generate less revenue than Neyer’s proposed medical facility, it would still promote economic development. Therefore, IT IS HEREBY ORDERED AND ADJUDGED: 1. That Petitioner's Motions for Interlocutory Order and Judgment are hereby GRANTED; 2, That the Petitioner, pursuant to the provisions of KRS §§ 416.540 — 416,670 and other applicable law, is entitled to condemn the properties and property rights which are the subject of the Verified Petitions for Condemnations filed herein; 3. That the Reports and Awards of Commissioners filed herein on dates described above conform to the provisions of KRS § 416.580; 4, That Petitioner is hereby authorized to take possession of the properties as described in the Verified Petitions for Condemnations for the purposes set forth in the Verified Petitions for Condemnations upon payment to the Campbell Circuit Court Clerk in the amounts set forth above, which are the amounts of compensation awarded by the Commissioners; and 5. That in the event of the passage of thirty (30) days from the entry of the Interlocutory Orders and Judgments without any exception having been filed, the Master Commissioner shall convey the lands, to the extent herein condemned, to the Petitioner. cd ntered this 23“ day of _Novemboe. : Entered this day of Vaan 48

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