Central Arkansas Water at long last will begin condemnation of the 760 acres along Lake Maumelle that Deltic Timber Corp. wants to turn into a luxury subdivision, the giant timber and development company having refused to negotiate on a sale price. We take that as a happy, not an unfortunate, circumstance.
A jury of 12 good men and women will almost certainly arrive at a fairer price for both the developer and the taxpayers of central Arkansas than will the developer and the board that governs the water company. The utility offered Deltic a whopping $3.8 million — $5,000 an acre — for the rocky mountainside land, and it gave the impression that it was willing to pay more, maybe much more. Deltic considered that sum ridiculously low and refused to make a counter-offer.
Deltic, of course, wants to stall until the next legislative session, where it might have the extra clout to stop the utility and the courts from condemning the land. The water company says the high-dollar development will pollute the lake right at the intake of our water supply and that it would require a huge investment by the utility and its customers to keep the water suitable for drinking. There was speculation that the developer might seek as much as $20 million for the land to recoup a good bit of the fortune that it expects to make from building the pricey subdivision.
We are indebted to Frank Lambright, the retired Little Rock insurance executive, for demonstrating expertly the rip-off of water customers that we have feared was about to happen. For a quarter-century Lambright has carried on a one-man crusade to get people to see what happened to them with the enactment of Amendment 59 to the state Constitution in 1980. The amendment, sold to voters as a way to avoid a sharp increase in their homeowner taxes, carried a stealth provision. It virtually ended taxation of some of the most valuable property in Arkansas. Instead of being taxed on its true market value like your home or business, rural land would forever be taxed upon its productive, or use, value.
Lambright went to the county assessment and collection records and found that Deltic in the last tax year paid a grand total of $293.26 in school, county and city taxes on the 760 acres, about 38 cents an acre. Deltic acquired thousands of acres of scrubby land outside Little Rock’s western fringe in the expectation of making tens of millions of dollars in profits on its development and sale as the city exploded westward.
While the El Dorado-based company has paid 38 cents an acre in taxes, Lambright figures, the Arkansas homeowner pays an average of more than $1 per square foot — that is per square foot, not per acre - in property taxes.
Deltic has tried to frighten everyone in central Arkansas to its side by suggesting that the water company will have to raise its monthly water rate in order to buy the disputed land and other acreage like it to protect the reservoir. It seeks to make that prophecy self-fulfilling.
If the land is barred by public policy from being used for high-density development then a circuit court jury would be perfectly justified in finding that the land’s market value is not $20 million or even $3.8 million but exactly what the corporation considered the land worth when it went down every year to pay taxes on its worth. What could be fairer than that?
