July 12, 2014 in Opinion

Kaari Burrows Davies: Inflated rent appraisals hurt Priest Lake

Kaari Burrows Davies
 

There is a lot of disinformation about the current conflict between the Idaho Land Board and dozens of cottage site lessees at Priest Lake. Most of that disinformation is coming out of Boise. The state of Idaho cannot defend their recent appraisals, which are riddled with errors and will increase rents on the lake by 50 percent to 126 percent in one year’s time. Instead, the state’s lead attorney says that rents were too low – in the 1950s and 1960s – as justification for the massive rent increases in 2015. Really?

For over 80 years, Idaho’s Land Board has been setting the terms and rental rates for lessees at Priest Lake. If they are unhappy with what they charged 50 years ago, they should be blaming themselves, not artificially inflating the appraised values for 354 lots at Priest Lake today. Fact is, the state is proposing rent increases from this year’s average rent of $11,000 per year to $18,000 per year to rent land (not cabins). Some folks will be asked to pay upwards of $25,000 a year to rent.

To be clear, Priest Lake is not Payette Lake. Most of us are still on septic systems and draw our drinking water out of the lake with 150-foot hoses. We do not have a major airport, ski resorts, hospitals or K-12 schools within 60 minutes of our lots. Most of the lots are summer use only.

The state estimates 10 percent to 30 percent of lessees will have to abandon their lots based on the new rents. Tom Schultz, director of Idaho Department of Lands, stated recently that the state can absorb 47 percent vacancies and still make money. To follow his logic, why not raise the rents 1,000 percent above fair market value and live off of the 10 percent of lessees who can afford to stay on the lake?

The lessees are the only folks calling attention to the approaching train wreck that the government planners in Boise are creating at Priest Lake. The idea that the state is willing to accept 47 percent abandonments later this year is irresponsible and reckless. Among questions that Schultz and the Land Board are not willing to answer: Why are the state’s new appraisals, completed by a Montana appraiser, 30 percent to 40 percent higher than appraised values established by two experienced and highly respected North Idaho appraisers for the exact same lots?

Idaho’s Endowment Trust counts on consistent annual rent to support school funding. How can 166 abandoned lots – generating zero income – be in the best interest of Idaho’s schoolchildren? Where will the state go to make up for millions in lost consumer spending and jobs that are created by these same lessees? Current lessees remain in this legal fight against the state of Idaho because, as a group, we have millions of dollars’ worth of assets (cabins) built as a requirement of leasing that will be stranded. Because of the inflated rents, lessees have found they can’t sell their improvements (cabins). As of this writing, 28 cabins on state-leased lots are for sale at greatly reduced prices.

If dozens of lessees leave the lake later this year, there will not be an influx of new renters standing in line to take our place.  If the bulldozers continue to demolish homes, no one will be clamoring to take over expensive leases and build new cabins that they too will have to destroy at the end of their lease. Lessees are asking for fair-market values and a fair appeal process. It’s time for the state of Idaho to maximize the long-term income for the Endowment Trust by creating a reasonable plan that maintains a stable funding source for Idaho’s schools and the North Idaho economy.

Kaari Burrows Davies is a native of Idaho. Her family members have been lessees on both federal and state land at Priest Lake for over 90 years.


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