State officials have rejected an investment firm’s request to reconsider its massive land swap proposal involving state land in and around McCall for timberland in northern Idaho.
Governor Brad Little and other members of the Idaho Land Board voted 5-0 against the request by Trident Holdings to rescind an August rejection letter from the Idaho Department of Lands. The board in the same vote also rejected the company’s request for an administrative procedure called a contested case hearing.
State officials in the letter to Trident Holdings said it was rejecting the deal to swap 33 square miles (85 square kilometers) of state land in and around McCall for 33 square miles (85 square kilometers) of private timberland in northern Idaho because the state would lose $292 million.
The Lands Department in the letter said the estimated value of the state land around McCall is $366 million, while the land it offered had a value of $74 million. The Lands Department said that the gross value of the state land was $488 million if fully developed. The 25% difference is a discount, or developer’s risk, the state factored in due to the associated costs Trident Holdings would face in developing the property.
Trident Holdings has said the Lands Department’s valuation of the lands is way off, and the company offered roughly $40 million for the state land that’s just over 20,000 acres.
“I can tell you that there’s nobody that believes that 20,000 acres is only worth $40 million,” Republican Secretary of State Lawerence Denney said after the meeting. “What I think is that it benefits us to hang onto that awhile longer, the way inflation is going and prices are going up. If you look at the long term, is this (Trident Holding’s offer) the best solution? I don’t know that it is.”
The vacation and second-home area in and around McCall is prized for its outdoor recreation opportunities, but it also faces growing pains with a shortage of housing.
Alec Williams of Trident Holdings after the meeting said he was disappointed and wasn’t sure what the company’s next steps might be. The company earlier this month started legal action by filing a petition for judicial review involving the previous rejection. Trident Holdings has said the swap, if successful, could ultimately lead to housing developments in the McCall area. The company also said it would help with preservation of open space with what would be the state’s largest park.
But Williams said the Lands Department valuation of the land put that out of reach.
“No proposal makes sense at a $488 million land valuation,” he said. “You can’t do any conservation work. Local housing is completely out of the question. Really, any of the things that critics, or people concerned with our project, voiced wanting to do is equally impossible now. I don’t know what that future looks like, but it looks far darker than it did yesterday.”
The dispute could have ramifications for state-owned lands not only in the McCall area, but across the state. That would be especially true in areas such as McCall where skyrocketing land values could force recalculations of the best use of state land and how much should be charged for leases on state-owned land.
Idaho received 5,600 square miles of endowment lands when it became a state in 1890, and retains about 3,900 square miles. The Land Board is constitutionally required to use the lands to generate the most money over the long run. The lands in the last fiscal year generated about $90 million, mainly for public schools.
“It’s certainly possible that other people will come forward with offers (in McCall),” Republican Attorney General Lawrence Wasden said after the meeting. “Our duty is not to just the beneficiary today, but to the beneficiary 10 years, 50 years and 100 years from today. That is, what is the value today? What’s the potential for value and increase in the lifetime of the property? Which is in perpetuity. So we have to take that long view.”