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Tuesday, November 30, 2021

BREAKING: Judge Grants Campbell County Schools’ Case to Take DAV Property

A judge has ruled the Campbell County School Board can proceed with its eminent domain action on the former Disabled American Veterans Property.

by Robin Gee

A judge’s ruling has cleared the way for the Campbell County School Board to proceed in its efforts to secure the former Disabled American Veterans site for a new middle school building.

Campbell County Circuit Court Judge Julie Ward ruled this week that the school board is justified in its claim to take the property located at 3725 Alexandria Pike through eminent domain.

With a letter in hand issued last month from the Kentucky Board of Education granting permission to proceed, the school district is poised to moved forward with their plan to take the property to build, what they call, a much-needed second middle school. 

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The battle over a coveted property


In late 2020, the DAV announced it was moving and selling its property. At the same time, the schools had been searching for a property to build the new school, and the city of Cold Spring had been planning to purchase the property to fulfill a long-time goal to bring a hospital facility to the area.

When bids for sale of the property opened up, developer Al. Neyer bid with the intention of securing the property to develop a hospital on the site.The school district also bid on the site, valued at between $4 million and $5 million, but did not win their final bid of $6 million. School officials stated they were not given the opportunity to make further counter offers, and the DAV made no effort to negotiate. The property went to the developer for $6.5 million. In April 2021, the developer made good on a purchase agreement and sold the property to the city.

With the board’s final bid, school officials had noted the potential of filing for eminent domain and seizing the property. In the meantime, the developer and the city worked out agreements and plans to develop the site, including securing interest from St. Elizabeth Healthcare and potential interest from other medical providers.

Judge’s ruling: public benefit vs public use


The city of Cold Spring filed to stop the schools from taking the property through eminent domain with the claim that, according to Kentucky law, a property in public use and owned by a public entity cannot be taken for another public use.

The judge dismissed the city’s argument, stating despite the intention of providing a public benefit (a medical facility and the tax revenue that could bring), it is not enough to claim it as a public use.

"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 been used for 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," the judge wrote in her decision.

"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."

The judge stated the development of the project appeared to be through private funding. She said the evidence did not support the idea that the city bought the property with the intention of issuing bonds or other government funding to support the development.

Further, she wrote, "...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."

For its part, the city has not claimed otherwise, but has held that, in addition to bringing medical services to the area, the tax revenue generated by payroll and business taxes would provide a much-needed resource for economic development.

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Economic development and other arguments


The city also noted a 1963 agreement with the Campbell County Business Development Corporation, an entity devoted to economic development in the region, that outlined the future use and development of the property. The agreement provided a series of restrictions regarding the future use and development of the property with the intention of reserving and promoting its use for economic development.

The judge agreed with the economic development value the city project would bring, yet, she said, she believed a school would also contribute. "Although a middle school would likely generate less revenue than Neyer’s proposed medical facility, it would still promote economic development."

Another argument put forth by the city focuses on some of the physical aspects of the property and the expense involved in fixing some of the property’s problems. In particular, a large gas line transverses the property. It would be expensive to move, but state law requires school buildings be at least 200 feet from high-pressure gas lines.

The school argued that, because it didn’t need to build a building on the entire site, it could be remodeled in such a way to be a safe distance from the gas line.

For a middle school


The arguments laid out by the school board noted the strong need for the school. The Campbell County middle school is the third largest middle school in the state with a population of more than 1,200 students. The school board’s argument is that ideally, a middle school should have half that, between 600 and 700 students.

According to Superintendent Dr. David Rust, the board had been searching for a suitable property to add a second school for about a decade, looking at large properties in the county including the former Beverly Hills Supper Club site and the former Campbell County Boys Lodge. None were found suitable.

One attraction of the DAV site is the use of the building. For other development, the building would need to be torn down, but the schools claim they can retrofit and use the existing building, saving both time and money. The property is large enough, too, to be able to store school buses on site, another plus for saving money and time. Moving into the existing building instead of building new, would save the schools approximately $7 million, according to a report by the district’s architect.



What’s next


Final approval by KDE is not needed before the schools can file for eminent domain, but it is required for them to move ahead with purchase and development of the property. In August, KDE outlined some parameters that had not been met by the schools, but last month issued another letter noting that some of the concerns have been resolved and that others were on a path for resolution, and, therefore approved the school board moving ahead with eminent domain. Still, before construction can happen, the schools will need KDE’s blessing. 
 
RELATED: DAV Property Ruling Still to Come; KDE Letter Approves Schools to Move Forward

The city can appeal this decision, but Fort Thomas Matters has not received comment yet on whether officials plan to do that. We will update as the story unfolds. 

A review of the DAV property story


Here is more background through coverage of the DAV story:
 
RELATED: National DAV Headquarters moving from Cold Spring to Erlanger

RELATED: DAV Move: A Bittersweet Parting as Cold Spring Considers Future Potential

RELATED: Cold Spring Plans for Health Care Facility to Replace DAV

RELATED: Need for New Middle School Fuels School District Interest in DAV Property

RELATED: Fight Over DAV Property Heats Up: School District Files Suit for Eminent Domain

RELATED: Cold Spring Closes on the Purchase of DAV Property





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