Two cities opposed to the City of Industry’s purchase of 2,450 acres of ranch land on the edge of Los Angeles, San Bernardino and Orange counties have petitioned the state to block the $42 million sale, saying approval of the heavily discounted price amounts to a gift of public funds.
Chino Hills and Diamond Bar are asking the state Department of Finance to reject the sale, or at the very least begin a 60-day review to determine if the sale is legal, according to letters sent to the department by the two cities on Aug. 24 and Aug. 28, respectively.
By slashing the sales price by almost $60 million from the recommended price, the two cities argue they are being robbed of tax dollars that flow from the sale since the land is located within the two cities and outside the City of Industry.
The lowered price cost Diamond Bar $2 million, according to the city’s letter.
Chino Hills City Attorney Mark Hensley wrote the City of Industry withheld its intentions to build a solar farm on the property that would deliver $10 million annually to its coffers. If the Oversight Board knew this, it would have commissioned an updated appraisal that could have raised the price above the current appraised value of $100 million, he wrote.
“As a result of this deception, the affected taxing agencies have been financially harmed and the (Oversight Board) was not able to carry out its obligation to maximize the value of the property,” Hensley wrote.
Diamond Bar City Attorney David Deberry wrote the Oversight Board had “violated its fiduciary duty” by not selling the land for the highest value.
Graham Gilles, a real estate broker with The Hoffman Co. originally hired to market the land, has argued to no avail that the land should have gone out to public bid.
“If you are trying to get the highest and best value, well that didn’t happen,” Gilles said.
Diamond Bar also asserted that Industry City Manager Paul Philips’ presence on the board was a conflict of interest.
“At best, the Oversight Board was ignorant of its responsibilities and (was) bullied into this decision. At worst, it was aware of those responsibilities and for whatever reasons, chose to ignore them,” Deberry wrote.
Industry City Attorney Jamie Casso called the objections from the two cities expected.
“We are confident that the DOF (Department of Finance) will review the proposed sale and approve it in according with state law,” Casso wrote.
H.D. Palmer, the Department of Finance’s…