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8.2 Sale of Airport Park ... eIll' OF SALINA REQUEST FOR COMMISSiON ACTION DATE 6/23/1980 TIME 4:00 P.M. AGENDA SECTION: Administration ORIGINATING DEPARTMENT: APPROVED FOR NO. 8 ~BJ~~:1 City Manager ',-,~, I ITEM BY: ,Ji Ed NO. 2 Rufus L. Nye BY: Staff report on the possible sale of Airport Park property. Please refer to Memorandum #80-4, dated June 13, 1980. COMMISSION ACTION MOTiON BY SECOND BY TO: MEMORANDUM #80-4 DATE: June 13, 1980 TO: City Commission FROM: , Rufus L. Nye, City Manager SUBJECT: Sale of the Old Airport Property At the April 14, 1980, City Commission meeting, George Ether- ington, 443 Aullwood, proposed the City sell the approximately 137.5 acres of land commonly known as Old Airport Park. Mr. Ether- ington based his request on several assumptions: 1. The City presently has sufficient park land. 2. Even with the sale of 137.5 acres, approximately 13 acres remains along Crawford just north of the Muncipal Golf Course and that site would be adequate to serve as a baseball complex and also as park land for the area. 3. The funds, provided from the sale of the property, should be placed in a sinking fund which the City could then use to acquire park land and to develop existing and future parks. 4. The new homes constructed and sold from the land would provide additional revenues to local units of government. I would like to examine each of these proposals in turn. The question of adequate park land does not have a definitive answer. Experts in the field will disagree over what is sufficient park land. However, it is evident that the neighborhood around the Old Airport property does not now have public parks. There is no park land to serve the approximate 4,000 people who live east of the Smoky Hill River. It is also apparent that the area to the east of the City will be one of two areas in the City where future expansion will take place. We estimate that as many as 8,000 citi- zens could live east of the Smoky Hill River within the next ten years. Certainly the Old Airport Park is the only publicly owned land available for a park use in this area. Both the City Planning Commission on February 5, 1980 and the Salina Recreation Commission on January 15, 1980 are on record in favor of retaining the Old Airport Park as park land. They feel in essence that it is well located and holds great potential for park and recreational usage. The Salina Recreation Commission in particular is concerned about the lack of adequate adult softball and baseball facilities in the City. The uncertainty of retaining 'the Schilling baseball complex and the uneasy relationship with KTI are major elements in the Recreation Commission's concern. A related question is the matter of the approximate 13.1 acre site along Crawford just north of the Municipal Golf Course. This property is not large enough for any significant activity, except perhaps as a neighborhood park. The area contains approximately MEMORANDUM #80-4 June 13, 1980 Page Two 13 acres. As example, the City's newest park, Jerry Ivey, contains more than 23 acres. This site is also not adequate for usage as a community wide baseball and softball complex. There are also some concerns about the topography and added cost that might be required to develop this area. Also, a producing oil well is located on this property which would reduce the effective land available for park purposes, although, of course, a park could be designed to maximize the available land. The argument that the City can utilize the revenue from the sale of the airport property to purchase and develop other park land is seductive at first glance. I have talked with several realtors and get wildly differing opinions on the value of this land. A major concern, of course, is the obvious fact that 30 acres of the 137.5 acre site are now in concrete runways and taxi- ways. This concrete may potentially have some positive values for development, but its negative factors would far out weigh its posi- tive values. Any potential purchaser would have to take into account the location of the concrete runways. Furthermore, the cost for removal of the concrete would be quite high, particularly in view of the fact of the high quality construction utilized in airport runways. I have heard values placed by realtors upon the property "as is" from $1,000 an acre to $8,000 an acre. This would vary the possible revenue from this source, from approximately $137,.000 to $l,lOO,QOO. We have no way of knowing what value the City would receive. Of course, the property would have to be appraised and a minimum price established. . The City Commission could set aside in a special fund the re- ceipts from the sale and earmark those funds for use only for park acquisition and development. Of course, this action would not prevent a future City Commission from making the decision to use the monies for another purpose. I doubt there is much argument the City recreational end park facilities could stand upgrading. There are many suggestions and proposals for new facilities and park improvements, such as light- ing Lower Indian Rock Park, or expansion and improvement of the City's adult softball and baseball facilities; and there are requests for various improvements in other City parks. Any revenues generated from the sale of this property certainly could be used very bene- ficially to improve facilities in existing City parks. The question of purchasing other land to replace ~he Old Airport Park is more problematical. It may 'be difficult to find adequate open space in the City that would be available for purchase by the City. First of all, the price is unknown and could easily far exceed any monies received from the sale of the Old Airport property. In addi- tion, of course, when a city purchases property, the price is fre- quently much higher than when private persons purchase land. This is MEMORANDUM #80-4 June 13, 1980 Page Three because if .the property owner refuses to sell, the matter goes to condemnation in which case the courts and juries frequently grant excessive awards to the property owner. If this property is sold and developed into residential lots, I estimate that approximately 350 dwellings on 10,000 square foot lots could be provided. The exact number of lots could vary from that estimate, depending upon the zoning and the subdivision design. Also, how the subdivider deals with the existing concrete runways and taxiways would effect the number of lots. Those 350 homes would provide revenues to the local units of government. The development time for these properties, of course, is unknown and could stretch out for several years during which time, of course, the City would receive the monies over a period of time. If the average new home had a market value of $90,000, which I think is probably reasonable in view of market conditions, at the present assessment rate of 9%, it would have an assessed valuation of $8,100. Based on the 1979 tax levy of 110.477 mills, each resi- dence would pay $929.64 in property taxes. Extending the example of the tax payment of $929.64 annually to the 350 homes would yield a total property tax revenue of $325,374. Of this total, the City would receive approximately 34.7% or $113,009. The School Dist~ict would receive approximately 44.4~ or $144,466. The County would receive approximately 17% or $55,313. The remaining funds are divided up between the state levy and special districts. Of course, tax revenue is subject to change, depending upon the mill rate and assessing practices. In addition, personal property, primarily auto- mobiles, would provide additional revenue which, on a very unscienti- fic basis, I estimate to total about $55,000 to $60,000, which would be split up in the same ratio as the property taxes. A basic argument in favor of selling the Old Airport Park is the future demand for new homes in the City. We are now going through another demonstration of the cyclical nature of the housing industry. _It has its very high points and, as we are now experi- encing, its depressed times. The primary impetus for land subdivi- sion and development is market pressures, that is, the public's de- manding new homes. Clearly Salina's future development will be to the east and the south. The north and west of the City are restricted to future development because of the interstates and more importantly, possible flooding. At the present time, there are more than 1,400 platted residential lots. These vacant lots are, of course, ready for build- ing; so there is no shortage at the present time of home sites. MEMOR&~DUM #80-4 June 13, 1980 Page Four Certainly, if Salina is to prosper, more land must be made available for development. But Salina is not in a land locked position; there are many acres of attractive land that could be developed. The development pressure argument ties in with the need for more local government revenues. If the market demand is present, developers will meet that demand without the Old Airport Park. If development takes place, the local units of government would still receive the revenues and the public, of course, would retain Old Airport Park. An argument not advanced by Mr. Etherington, but related to this issue, is the need for a north-south street between Crawford and Magnolia. Although no decision has been reached, a leading alternative is to extend the taxiway, that is the runway on the west side of the property, to Magnolia and connect it on the north end to Crawford. The obvious appeal of this alternative is cost. It, of course, has some limitations, primarily because the road cannot easily be extended further north, although the proposed road would be just west of Presbyterian Manor. The City has not seriously undertaken work on this project because of a lack of funds; but certainly in the near future, pos- sibly a five year period, this issue should be resolved. - The City Commission directed the City Manager to prepare a report on Mr. Etherington's proposal and to make a recommendation. I have considered Mr. Etherington's proposal and join with the Salina Planning Commission and the Salina Recreation Commission's recommendation that the Commission not sell the Old Airport pro- perty. I base this recommendation on several concerns: 1. I am not convinced that the sinking fund idea, the major attraction of the proposal, will prove bene- ficial to the City. 2. There is an obvious need for park land in this area. There are citizens already living here and this area is certain to develop. 3. I doubt that the land could be replaced in another location for the price received for the Old "Airport property. 4. Although at the present time the City does not have the resources to develop this land, I think future Commissions will be able to obtain the funds. MEMORANDUM #80-4 June 13, 1980 Page Five 5. If conditions change, a future Commission could authorize sale, at probably a far higher price. There is no immediate benefit, except perhaps to use the funds to improve existing parks, to the public to sell the property. Rufus L. Nye City Manager RLN : bh