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STATE DEFENDED IN SCHOOL TRUST LAND SALE

SHARE STATE DEFENDED IN SCHOOL TRUST LAND SALE

State officials made a good deal and didn't deserve to be "humiliated" by a legislative audit questioning the pending $1.1 million sale of school trust lands in Washington County, an attorney for the developer buying the property said.

"He paid way too much for the land. I think a fair price was $400,000 for the whole package. Maybe less because of the desert tortoise problem," said Jerry Kinghorn, the attorney representing James Doyle of Rocky Mountain Ventures.The U.S. Fish and Wildlife Service has protested the sale of the land because it is considered critical habitat for the desert tortoise, a species in danger of extinction. Kinghorn said this is the biggest problem with the sale, one that could render the land worthless.

But critics of the December 1989 deal, which has yet to be completed, have a longer list of complaints. Among their concerns are the way the price was established and the terms of the sale.

The legislative auditor general's office presented an audit to lawmakers this week that labeled the agreement reached between the Division of State Lands and Rocky Mountain Ventures "controversial and complicated" and determined the state needs to do a better job selling land held in trust for Utah schools.

Rocky Mountain Ventures had been given a deadline to come up with a $415,000 down payment by midnight Tuesday, but Kinghorn said the money was being withheld until the desert tortoise issue could be resolved.

House Majority Leader Craig Moody, R-Sandy, a member of the Legislative Audit Subcommittee, said as far as he's concerned, the deal is off no matter what the company's concern is.

"Let them tell it to a judge," Moody said. "The best thing for us to do is to turn it over to the attorney general's office."

Pat Spurgin, director of the Division of State Lands, said the company is in default. "I can't say the deal's off until we get legal advice," he said.

Kinghorn said his client will go to court if necessary to buy the property in order to recoup a $5 million investment in development plans and lease payments to the state since 1983.

But, Kinghorn said, the company no longer plans to being developing the property immediately. Instead, Rocky Mountain Ventures will put up 351 acres nearest a Washington City golf course for sale as soon and the transaction with the state is complete to avoid further conflict over the land.

The rest of the property, separated from the prime land by cliffs and ravines, may yet be developed or could also eventually be sold, the attorney said.

Kinghorn said that the way the deal with the state was structured, the down payment made by his client will cover the cost of just the 351 acres. The remaining $685,000 must be paid within 76 months before the company owns the rest of the property.

The attorney said that does not amount to an interest-free loan from the state as the legislative audit indicated since the land will belong to the state until the money is paid.

The original price agreed to for the property was $400,000, Kinghorn said. But after concerns were raised by adjacent landholders that the amount was too low and questions of legal access to the land came up, Rocky Mountain Ventures and the state negotiated a new deal.

The final agreement, Kinghorn said, allows his client to pay slightly more than the original price to gain title to the 351 acres that would likely be developed first.

Doyle does not stand to get rich on the deal, his attorney said.