Immediately after opening their Jan. 29 meeting, the Buena Vista County Board of Supervisors unanimously voted to enter an unannounced closed session for discussing "strategy regarding pending or imminent litigation" regarding $841,355.66 in current and outstanding taxes, penalties, interest and special assessments for the Sunset Bay Reflections condo site.
Neither the Supervisors or the property owners, Craig and Jared Smith of Pleasant Hill, appear to be actively pursuing a lawsuit, but before the vote was taken to move into closed session, County Attorney Dave Patton suggested the Board examine "different options you may have if Smith is unhappy."
Sunset Bay Reflections, LLC purchased the failed Regency site for $280,000 during a March 2011 sheriff's sale. The property, located between Sunrise Pointe Golf Course and Sunrise Campground, is currently valued at $1,205,690.
Outstanding tax debt has been an ongoing issue, but discussion regarding the matter has not occurred for nearly three months. Smith last requested a solution from the Supervisors and Storm Lake City Council late last fall.
Few details were released after the Supervisors reconvened in open session after nearly 20 minutes of deliberation.
"At this time, we have not come up with any decisions," said Supervisors Chair Ken Hach. "We are looking for a solution that would benefit the entire county and the taxpayers, but for right now, we don't have anything more to give to the press."
Following the meeting, Patton told the Pilot-Tribune the Supervisors' tax advisor, Des Moines-based public finance attorney Jon Danos, informed county officials they have the power to abate current and past taxes, interest and penalties, in addition to modifying a special assessment Smith has challenged.
During a November city council meeting, Smith asserted the development agreement's triggering date for the completed condos should have voided the $8 million special assessment between Regency and the City of Storm Lake, since no development occurred. Based on the assessment, $324,934 in taxes were compiled for 2008.
The development agreement and special assessment were later withdrawn in March 2009, after it was clear Regency's project was going to fail.
However, with the county now holding a lien on the property, the project is unable to proceed without payment of outstanding debt. Various ideas for housing projects have included luxury condos, single-family apartments or senior living, but no plans are currently available.
"No one is going to come along and pay the taxes," Patton said. "Some action needs to be taken, because the property is going to sit there undeveloped until someone resolves the issue."
Both city and county officials have expressed interest in moving the potential project forward, Patton said, but noted the final decision regarding taxes lies in the hands of the Supervisors.
Craig Smith, who was not present at the meeting, said he had not recently spoken with the Supervisors, but was still anticipating a swift solution.
"The next thing to do is sit down, talk, see what the options are and go from there," he told the Pilot-Tribune via phone. "But what happens from there, I don't know."