Cougar Bay Developer Loses Land To Foreclosure But Mccormack Says He Still Plans 92-Home Subdivision

A developer didn’t raise enough money by Thursday to avoid foreclosure, but he says he still plans to build a subdivision overlooking Cougar Bay on Lake Coeur d’Alene.

The Kootenai County sheriff held a sale Thursday at which developer Mike McCormack needed to pay $848,000 to avoid the land reverting to the previous owners, the Raymond Johnson family.

But McCormack didn’t show up with the money. No one else offered to buy the land, so the property reverted to the Johnsons.

Although McCormack failed to come up with the money, Idaho law gives him a year to raise the funds - plus interest - to pay the Johnsons for the land where he wants to build a 92-home subdivision.

“(The year) is like an extension of a loan,” McCormack said. “We are going to go back and redeem the property. It is our plan to put the project back together.”

McCormack has weathered a spirited fight by neighbors, who formed the Rural Kootenai Organization. The group’s legal challenges have locked the project in the courts for seven years. In December, the Idaho Supreme Court voided McCormack’s attempt to use public land as open space for the development.

McCormack said he stopped making payments on the land two years ago until he could determine if he could get the project approved.

On June 28, McCormack told Kootenai County commissioners he thought he could raise the money by the sheriff’s sale deadline.

On July 12, commissioners gave preliminary plat approval to The Ridge at Cougar Bay.

Senior planner Rand Wichman said it’s unclear what effect foreclosure will have on the status of that preliminary approval.

“The board knew this was certainly a possibility that this sheriff’s sale was going to proceed,” Wichman said. “Whether that affects (McCormack’s) ability to continue with the subdivision, I don’t know.”

Wichman plans to talk with county attorneys next week to determine whether the county’s approval still applies.

Local attorney Scott Reed, who represents the Johnson family, said the county issued it a deed worth $500,000 for ownership of the land. McCormack must pay that amount plus 11.5 percent interest to secure the land.

Reed said he also will ask a judge to order McCormack Properties of Idaho Inc. to pay the remaining $348,000 owed.

“We don’t have a problem with that,” McCormack said of the $348,000. “It wasn’t our intention to stiff the Johnsons. We just have to get our ducks in a row and pay them.”

Reed said all that the Johnsons want is to be paid.

Other developers may offer the same amount of money for the land, but the redemption law gives McCormack first crack at buying the land back.

“The Johnsons are not going to pursue the (final) plat. That’s for sure,” Reed said.

McCormack said it’s too early to predict when he would start building if he rounds up enough investors.

“We still have a few hurdles to go over,” he said, “but we are not out of it by any means.”