HomeMy WebLinkAboutRes 143 - Exchange Real Prop - StateDeschutes County Board of Commissioners
1300 NW Wall St., Suite 200, Bend, OR 97701-1960
(541) 388-6570 - Fax (541) 385-3202 - www.deschutes.org
AGENDA REQUEST & STAFF REPORT
For Board Business Meeting of November 24, 2008
Please see directions for completing this document on the next page.
DATE: November 13, 2008
FROM: Teresa Rozic Property & Facilities 385-1414
TITLE OF AGENDA ITEM:
Consideration of Signature of Resolution 2008-143, declaring the intention of Deschutes County to
exchange real property with the State of Oregon, setting a hearing date and providing notice.
PUBLIC HEARING ON THIS DATE? No
BACKGROUND AND POLICY IMPLICATIONS:
In 2007, the Department of State Lands (DSL) acquired a 945 -acre tract of land from the U.S. Bure iu
of Land Management. The property, known as the South Redmond Tract, is southeast of the City cf
Redmond and is located adjacent to and south of the Deschutes County Fair and Expo Center. DSI ,
developed a Land Use and Management Plan for the tract through a collaborative planning effort with
federal, state and local entities. DSL will apply for inclusion into the Redmond Urban Growth
Boundary and develop the property to meet the region's short-term needs for large -lot industrial uses.
The tract's proximity to the Fair and Expo Center offers a variety of development opportunites to
Deschutes County. In various work sessions, the Board of County Commissioners (the "Board")
expressed interest in acquiring a portion of the South Redmond Tract. In mid -2007 the Board directed
county staff to meet with DSL staff to review a list of county lands available for exchange. DSL
indicated an interest in two county properties known as Long Butte (120 acres) and Warrin Road (l 59
acres). The County expressed its desire to exchange those lands for approximately 238 acres of the
South Redmond Tract.
On October 14, 2008, the State Land Board approved the South Redmond Tract Land Use and
Management Plan, including conceptual approval of the land exchange.with Deschutes County. In a
separate agenda item at that meeting, the Land Board authorized staff to negotiate the terms of a prc-
exchange agreement with the County.
Deschutes County Code Chapter 11.08 provides that the Board of County Commissioners declare i :s
intention to exchange real property by resolution, provide public notice of the proposed land exchange
and conduct a public hearing.
Page 1
FISCAL IMPLICATIONS:
The land exchange will be value based (i.e. the amount of land traded between the parties may be
different but the values will be more or less equal). The pre -exchange agreement identifies the lands to
be exchanged, method of valuation, due diligence requirements, cost sharing and other responsibili ties
of each party. If the Land Board approves the pre -exchange agreement at their meeting on December 9,
2008, the parties will proceed with surveys and appraisals to determine final values and costs.
RECOMMENDATION & ACTION REQUESTED:
Staff recommends signature of Resolution 2008-143.
ATTENDANCE: Teresa Rozic, Property Specialist
DISTRIBUTION OF DOCUMENTS:
Copy of signed Resolution to Teresa Rozic.
Page 2
REVIEWED
LEGAL COUNSEL
For Recording Stamp Only
BEFORE THE BOARD OF COUNTY COMMISSIONERS OF DESCHUTES COUNTY, OREGON
A Resolution Declaring the Intention of
Deschutes County to Exchange Real Property
with the State of Oregon acting by and
through the Oregon State Land Board on
behalf of the Oregon Department of State
Lands, Setting Hearing Date for the Purpose
of Hearing Objections and Providing Notice.
*
*
RESOLUTION NO. 2008-143
WHEREAS, Deschutes County Code Chapter 11.08 provides that the Board of County
Commissioners (the "Board") shall declare its intention to exchange real property by proper resolution;
and
WHEREAS, the Board expressed its interest in exchanging real property by letter dated
October 14, 2008 (DC 2008-565) to the State Land Board; and
WHEREAS, on October 14, 2008, the State Land Board approved the South Redmond Tract
Land Use and Management Plan, including conceptual approval of the land exchange with Deschutes
County; and
WHEREAS, on October 14, 2008, in a separate agenda item that describes the real property to
be exchanged and the general terms of a pre -exchange agreement, attached hereto as Exhibit "A" avid
by this reference incorporated herein, the State Land Board authorized staff to negotiate the terms of
the pre -exchange agreement with Deschutes County; and
WHEREAS, Deschutes County intends to exchange real property with the State of Oregon
acting by and through the Oregon State Land Board on behalf of the Oregon Department of State
Lands as described in Exhibit "A"; and
WHEREAS, a hearing shall be held for the purpose of receiving objections to the proposed
exchange of real property described in Exhibit "A"; now, therefore,
BE IT RESOLVED BY THE BOARD OF COUNTY COMMISSIONERS OF DESCHUTf,S
COUNTY, OREGON, as follows:
Section 1. The Board of County Commissioners of Deschutes County hereby declares i is
intention to exchange real property with the State of Oregon acting by and through the Oregon Sta :e
Land Board on behalf of the Oregon Department of State Lands, provided that the parties real h
agreement on the terms of the pre -exchange agreement and the State Land Board authorizes tl �e
exchange.
PAGE 1 OF 2 — RESOLUTION NO. 2008-143 (11/24/2008)
Section 2. The real property to be exchanged by Deschutes County is described in Exhibit "A",
attached hereto and by this reference incorporated herein.
Section 3. A hearing for the purpose of receiving objections to the above described 1 ind
exchange will be held at 10:00 a.m. on Wednesday, January 28, 2009, in the Board of Cotnty
Commissioners Hearing Room of the Deschutes County Services Building, 1300 NW Wall Str;,et,
Bend, Oregon.
Section 4. The Deschutes County Property Specialist shall give notice of the time and place for
the hearing set in Section 3 of this Resolution by publication of the notice marked Exhibit "B",
attached hereto and by this reference incorporated herein, in "The Bulletin" once each week for 1 our
consecutive weeks, with the last publication being at least seven days prior to the date of such hearii Lg.
DATED this day of , 2008.
BOARD OF COUNTY COMMISSIONERS
OF DESCHUTES COUNTY, OREGON
DENNIS R. LUKE, Chair
ATTEST: TAMMY BANEY, Vice Chair
Recording Secretary MICHAEL M. DALY, Commissioner
PAGE 2 OF 2 - RESOLUTION NO. 2008-143 (11/24/2008)
regon
Theodore R. Kulongoski, Governor
State Land Board
Regular Meeting
October 14, 2008
Agenda Item 8
SUBJECT
Department of State Lands
775 Summer Street NE, Suite 100
Salem, OR 973(11-1279
(503) 9.16-5200
FAX (503) 37'8-4844
www.oregonstatela zds.us.
State Land Board
Theodore R. Kulcngoski
Gevernor
Bill Bradbury
Secretary of State
Randall Edwards
State Tr' asurer
Request for approval to negotiate a land exchange between Deschutes County and
the State Land Board.
ISSUE
Whether the Land Board should give approval for the Director to coniplete
negotiations of a pre -exchange agreement for a land exchange between Deschutes
County and the State Land Board for the following properties:
• Lands to be Acquired by the Land Board from Deschutes County:
- Warrin Road Parcel (146.76 acres)
- Long Butte Parcel (120 acres)
• Lands to be Acquired by Deschutes County from the Land Board:
- South Redmond Tract North Parcel (up to 238 acres)
AUTHORITY
Oregon Constitution, Article VIII, Sections 2 and 5; pertaining to the Common
School Fund and land management responsibilities of the State Land Board.
ORS 270.010; pertaining to the sale of state surplus property.
ORS 273.055; relating to the power to acquire and dispose of real property.
ORS 273.171; relating to the duties and authority of the Director.
ORS 273.316 and .321; relating to the exchange of state lands
OAR 141-067; relating to the sale, exchange and purchase of state land.
Asset Management Plan (AMP) adopted by the Land Board, October 2006.
1
SUMMARY
This action is being requested in order to carry out one of the implementation
actions identified in the Department's Proposed South Redmond Land Use and
Management Plan.
During the development of the plan, Deschutes County showed a strong desire to
enter into a land exchange arrangement with the Department to acquire land within
DSL's South Redmond Tract lying south and adjacent to the 132 -acre Deschutes
County Fairgrounds and Exposition Center. In fact, the county had hoped to
acquire as much as 320 acres of the property from the U.S. Bureau of Land
Management (BLM), but put their plans on hold while DSL acquired the tract in
2007.
In mid -2007, the Deschutes County Board of Commissioners authorized county
staff to commence work on a land exchange proposal with DSL. County and DSL
staff met to review a list of county lands available for exchange and, in April 2007
DSL indicated an interest in two county properties known as Long Butte (120 acres)
and Warrin Road (146.76 acres) (see Appendix A).
Staff has investigated the two county properties. Preliminary feasibility studies
have also been conducted in order to determine if the acquisitions meet the
requirements of the Board's Asset Management Plan.
County Exchange Parcels
Warrin Road Parcel
This 146.76 -acre parcel (T15S R11 E Section 17 Tax Lot 700) is located on
Fryrear Road about 6 miles east of Sisters (See Appendix B). There is good all-
weather access to the land via county roads. The property gently slopes to the
east from a rise at the west end; views of the Three Sisters are available. The
parcel is rocky and covered with juniper and sagebrush. The surrounding land
use is large -lot rural homesites and farms. The property is zoned Exclusive
Farm Use, but it is not irrigated and, due to the poor soils, is not considered high
value farmland. A Surface Mining Impact Area Combining Zone overlay exists
on the property due to its proximity to the former county landfill and present
transfer station. A forty -acre parcel (Fryrear Road Parcel) of Common School
Fund land is adjoining and contiguous to the Warrin Road Parcel to the east.
The general area is recognized as deer winter range and is adjacent to the
30,000 -plus acre Bureau of Land Management Dry Canyon area. This primitive
BLM area is popular for its motorized and non -motorized trail opportunities.
Agenda Item 8
October 14, 2008
Page 2 of 6
This parcel has rural, non-farm dwelling homesite potential. When combined
with the Department's existing 40 -acre Fryrear Road Parcel, the total acres
available equal 186.76, enough for five homesites. The addition of the county's
parcel would benefit the homesite potential on DSL's Fryrear Road Parcel.
Preliminary analysis by staff reveal that, conservatively -speaking, a return on
investment of about 6% to 8% per year is possible, if the project takes five years
to plan, develop, market and sell. Other non -development management
alternatives include outright sale or exchange. Potential buyers/exchange
partners include adjacent property owners, developers or land conservancies.
Long Butte Parcel
This parcel is made up of 2 tax lots (T16S R12E Section 22 Tax lot 100 is 40
acres; T16S R12E Section 22 Tax lot 2800 is 80 acres) totaling 120 acres (see
Appendix C). The entire property is zoned Rural Residential with a 10 acre
minimum lot size (RR -10). The land sits atop Long Butte, a high "table"
formation midway between Bend and Redmond, just west (less than one mile)
of Highway 97. Views from the property, which has gently sloping side slopes
with a nearly level area at the top, range 360 degrees to Redmond, Smith Rock,
Powell Butte, Three Sisters, Mt. Jefferson and Bend. The surrounding
neighborhood is composed of fair to good quality homes on one to three -acre
parcels. An existing constraint on development of the property is access, as it is
limited to a 30 -foot wide right-of-way to Tax lot 2800 off a cul-de-sac (Imperial
Avenue).
As a result of the favorable zoning (RR -10) the 120 acres offers the opportunity
to develop 12 ten -acre homesites. Reaching this "highest and best use" hinges
on acquiring the additional access needed to meet land use development
standards. A number of opportunities exist to obtain access such as purchasing
access easements or additional parcels. Preliminary analysis by staff indicate
that even after accounting for the cost of acquiring access, the 12 ten -acre
homesites would provide a return on asset value of 9% to 10% per year, if the
project takes five years to plan, develop, market and sell.
Department of State Lands Exchange Parcel
South Redmond Tract North Parcel
The proposed South Redmond Land Use and Management Plan identifies up to
238 acres in the north half of Section 33 T15S R13E for potential transfer to
Deschutes County via a land exchange (see Appendix D). The land lies
adjacent and contiguous to the Deschutes County Fairgrounds and Exposition
Center. The North Parcel is currently zoned Exclusive Farm Use, though it is
not irrigated and of marginal agricultural value due to its rockiness and poor soil.
The county's plans for the land, once acquired, have not been determined. In
order to make any urban -level use of the parcel, the county will need to have it
Agenda Item 8
October 14, 2008
Page 3 of 6
"A' 3((a-
included in the Redmond Urban Growth Boundary and annexed to the city. The
county has indicated an interest in participating with the Department in a
cooperative effort to prepare the UGB amendment application to the city. If the
parcel were not the subject of an exchange, it is likely the plan would have
allocated the area to Targe -lot industrial uses.
Exchange Process
The land exchange is expected to be value based (i.e. the amount of land traded
between parties may be different, but the values will be more or Tess equal). The
Department is interested in maximizing the value of the Land Board's North Parcel.
DSL and the county have begun preliminary negotiations on a pre -exchange
agreement that identifies the lands to be exchanged, method of valuation, due
diligence requirements, cost sharing and other responsibilities of each party. Once
completed and approved by the county, the Department will request the Land
Board's approval of the final agreement. The Land Board will also be asked to
approve the final transaction. The Department and the county have not established
a firm schedule for the completion of this transaction. The county has been
interested in the land for some time. It is likely that the land exchange could be
completed by fall, 2009.
Valuation
The minimum acceptable land exchange value for the South Redmond Tract North
Parcel will be established by the Director based on the Department's estimate of
value as derived from the fair market value appraisal of each parcel. The county
will be responsible for obtaining current market value appraisals for the two county
properties (i.e. Long Butte and Warrin Road). Appraisals for each parcel (including
timber valuations, as applicable) will be conducted by State of Oregon licensed,
professional land appraisers.
Conditions of Exchange
The Department will retain all subsurface mineral rights on the South Redmond
exchange parcel. The Department will reserve the mineral rights and the right to
ingress, egress and use the surface to produce the minerals. The Department will
seek to obtain all mineral rights and interests for the county exchange parcels.
Agency and Public Review
The effects of the exchange proposal as to the South Redmond Tract has been
extensively discussed and reviewed by the agencies and the public as an element
of the Proposed South Redmond Tract Land Use and Management Plan process.
The county land exchange process will include opportunities for the public to review
and provide testimony on the exchange of the county lands.
Agenda Item 8
October 14, 2008
Page 4 of 6
A" ,-t(i a-
CONFORMANCE WITH THE ASSET MANAGEMENT PLAN (AMP) and RULES
GOVERNING THE SALE, EXCHANGE AND PURCHASE OF LAND (OAR 141-
067)
This proposal conforms to the requirements of both the AMP and the Board's rules
(Appendix E).
Specifically, the county parcels:
• Are located within the highly desirable central Oregon area;
• Could be classified and managed as Industrial/Commercial/Residential lands
under the AMP (with emphasis on large -lot rural residential);
• Offer rural residential development opportunities with development costs and
return within acceptable risk;
• Offer high probability for value appreciation or the ability to generate revenue
through development and sale;
• Represent an opportunity to acquire through exchange at relatively low
transaction costs;
• Offer near term potential net revenue/land appreciation returns in excess of
the target 5% to 7%;
• Require acceptable levels of capital investment to achieve or exceed the
target return; and
• Bring additional land management (and cost) burden to DSL that is within
acceptable range of costs/expertise.
The disposal of the South Redmond Tract North Parcel conforms to AMP disposal
criteria because it offers the opportunity to obtain land that is zoned for uses with
higher values and to realize return more quickly than can be achieved on the
existing DSL land. Finally, the disposal is consistent with the proposed South
Redmond Tract Land Use and Management Plan.
RECOMMENDATION
The Department recommends that the Land Board give approval for the Director to
complete negotiations of a pre -exchange agreement for a land exchange between
Deschutes County and the State Land Board for the following properties:
• Lands to be Acquired by the Land Board from Deschutes County:
- Warrin Road Parcel (146.76 acres)
- Long Butte Parcel (120 acres)
• Lands to be Acquired by Deschutes County from the Land Board:
- South Redmond Tract North Parcel (up to 238 acres)
Agenda Item 8
October 14, 2008
Page 5 of 6
<<�r
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APPENDICES
A. Map of Potential Land Exchange Areas
B. Map of Warrin Road Parcel
C. Map of Long Butte Parcel
D. Map of South Redmond Tract North Parcel
E. Asset Management Plan: land disposal and acquisition criteria
Agenda Item 8
October 14, 2008
Page 6 of 6
W'
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Potential Land Exchange
Deschutes Co. & Dept. of State Lands
Warrin.._Parceh._
(Deschutes County)
Fryrear Rd. Parcel
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Norti Parcel
outh Redmond_Tract
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Potential Exchange Property
DSL Owned Lands
September 24, 201.8
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Datum NAD83
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Appendix A
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Warrin Parcel
(Deschutes County)
F
rear Rd. Par:ei (DSL)
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Tax Lot Lines
DSL Owned Lands
September 24, 201 8
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Apoendi B
Appendix C
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or consult the primary data and information sources to
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Tax Lot Lines
DSL Owned Lands
September 24, 20 18
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A pe+n ix D
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24
2006-2016 ASSET MANAGEMENT PLAN
TABLE 3: PRINCIPLES FOR RETENTION, ACQUISITION & DISPOSAL
Action
Strategy
Locational Direction
' Additional Direction
Retention
Maintain a core of
permanent land
ownership during the
planning period
Lands to be retained during
the planning period include:
• Elliott State Forest and
the majority of
Northwest and
Southwest Forest lands.
• Nearly all Agricultural
lands.
• Blocked Rangelands.
• Department's office
building and certain ICR
lands In urban or
urbanizable areas.
• South Slough National
Estuarine Research
Reserve.
• Waterways, except
new lands,' historically
filled lands, and
contaminated lands on
a case-by-case basis.
• Mineral interest
ownerships except
those determined to
have little, if any,
potential for
development
• Known energy
resources.
Acquisition
Evaluate and pursue
Priorities for acquisition
All acquisitions must be approved by the Land Board and
(through
opportunities to
during the planning period
carried out in accordance with the Board's rules for
purchase or
acquire parcels
include:
exchanges and purchases (OAR 141-067). Properties
exchange)
available for sale or
• Purchase of developed
considered for acquisition will be evaluated in accordance with
through other means
or undeveloped ICR
both the following factors and acquisition criteria for the
(e.g„ in -lieu selection
lands in urban or
applicable land class:
or exchange) that
urbanizable areas,
• Net Revenue Potentlal/Capital Appreciation Potential:
have a high probability
particularly central
Near-term opportunities for an ROAV of 5 to 7% (real
for appreciation in
Oregon properties.
rate adjusted for inflation); or annual appreciation within
value or the ability to
• Purchase of Forest and
the same range.
consistently generate
Agricultural lands
• Capital Investment Requirements: Acceptable levels of
revenue over the long
throughout Oregon, with
capital investment (costs beyond purchase price) to
term for the CSF
preference to lands
west of Cascades.
• Exchanges with BLM or
other parties for other
lands in the Central
Oregon area that would
complement the
Department's
ownerships.
achieve the targeted ROAV,
• Management Costs: Anticipated annual management
costs fall within an acceptable range of costs comparable
to similar investments.
• Operating Budget: Anticipated annual management
costs can be bome by the Department's current budget
or funds are anticipated within a reasonable time
following acquisition.
• Local Govemment Coordination and Support:
• Exchanges or
purchases involving
surplus lands managed
by other state agencies,
e.g., ODOT and OPRD.
Coordination with local governments has occurred in
concurrence with the Departments State Agency
Coordination Agreement. The level of local government
(e.g., city, county, school district) support for the
acquisition.
• Support of Other Public Policies/Programs: The
acquisition assists in achieving or furthering another
state public policy or program objective (e.g„ State
Economic Development Strateav).
APPENDIX E
4, „
2006-2016 ASSET' MANAGEMENT PLAN
TABLE 3, CONT'D.
Action
Strategy
, .
Locational
. . .
• • .• .
, - . . ' . •
Additional Direction , • ,
Disposal
Pursuant to ORS
Priorities for lands to be
Disposal may be considered on a case-by-case basis as part
(sale or
exchange)
273245 and 273.316,
evaluate and pursue
disposed of or evaluated for
disposal through sale or
of SAMP's or master plans to maximize investments; to
respond to market-driven opportunities, especially for lands
opportunities to
exchange during the
acquired for purposes of future disposal; for lands not meeting
dispose (sale or
planning period include:
management expectations; for lands better managed by
exchange) of any
• Unleased, isolated
another entity; or to meet other public purposes (e.g., highway
parcels within the CSF
portfolio except those
specifically identified
Rangelands
. (approximately 12,000
acres).
rights-of-way).
Waterways (submerged and submersible lands) are not eligible
"new
for retention,
• Scattered Forest lands
(approximately 12,000
acres).
for disposal except as allowed for lands" (filled lands as
defined In ORS 274.095), historically filled lands, or
contaminated sites.
Proposed land sales or exchanges must be approved by the
,
Land Board and carried out In accordance with the Board's
administrative rules, The following criteria are among the
factors to be considered when evaluating a land disposal
proposal:
• Parcel has low income -generating potential and limited
multiple land use(s); Is not leased or leasable, has poor
physical attributes andlor has extemal constraints to
managing for highest and best use.
• Parcel has low appreciation potential.
• Parcel has no or limited access to utilities;
• Parcel management costs are high in comparison to
actual or potential retums and/or appreciation potential,
• Significant environmental risks are present, such as
hazardous waste or environmentally sensitive attributes.
• Changes in zoning or other circumstances preclude
development of the parcel for its highest and best use.
• Parcel is an in -holding within another major landowner's
ownership, or is a small, Isolated tract.
• Market conditions dictate that disposal ls prudent In order
to realize appreciation in value.
• A high level of market demand exists for the type of
property being considered.
• The highest and best use of the parcel has changed to a
use not compatible with the uses preferred by the
Department or is inconsistent with the Plan.
• Parcel has high holding costs, particularly those
associated with liabOity or other risk (Le., disposal
becomes an "emergency).
Prior to disposing of iand, an evaluation will be conducted of
the potential presence of mineral resources of value. if
present, mineral rights may be retained by the Department
following disposal of the surface lands.
APPENDIX E
25
"A 1;-/Ia-
PUBLIC NOTICE
On Wednesday, January 28, 2009, at 10:00 a.m. in the Board Hearing Room of the Deschutes
County Services Building, 1300 NW Wall Street, Bend, Oregon, the Board of County
Commissioners of Deschutes County will hold a hearing on an exchange of real property the
State of Oregon acting by and through the Oregon State Land Board on behalf of the Oregon
Department of State Lands.
The real property to be transferred by the above referenced parties is generally described as
follows:
State of Oregon to Deschutes County:
"South Redmond Tract North Parcel." Up to 238 acres in the North Half (NI/2) of Section 33,
Township 15 South, Range 13 East, W.M., Deschutes County, Oregon, adjacent and contiguous
to the Deschutes County Fair and Expo Center.
Deschutes County to State of Oregon:
"Warrin Road Parcel." Approximately 159.17 acres described as the Southeast Quarter (SE%) of
Section 17, Township 15 South, Range 11 East, W.M., Deschutes County, Oregon.
"Long Butte Parcel." Approximately 120 acres described as the West Half of the Northeast
Quarter (W'/2 NEl) and the Northeast Quarter Northwest Quarter (NE%/ NW'/) of Section 22,
Township 16 South, Range 12 East, W.M., Deschutes County, Oregon.
Any person may appear and make objections to the proposed exchange.
Deschutes County meeting locations are wheelchair accessible. Deschutes County provides
reasonable accommodations for persons with disabilities. For deaf, hearing impaired or speech
disabled, dial 7-1-1 to access the state transfer relay service for TTY. Please call (541) 388-6571
regarding alternative formats or for further information.
BOARD OF COUNTY COMMISSIONERS FOR
DESCHUTES COUNTY, OREGON
DENNIS R. LUKE, Chair
To be published in The Bulletin: December 2, 9, 16 and 23, 2008
To be posted: December 2, 2008
Page 1 of 1