GILROY
– The effort to build a landmark arts and culture center on
Monterey and Seventh streets appears headed for the courts.
A state-certified appraiser said Loi Dong’s boarded-up Chinese
food restaurant is worth $330,000. The city’s appraiser valued the
Monterey Street property at $97,000.
”
My price (is) fair,
”
Dong said.
”
I can’t buy anything with ($97,000).
”
GILROY – The effort to build a landmark arts and culture center on Monterey and Seventh streets appears headed for the courts.
A state-certified appraiser said Loi Dong’s boarded-up Chinese food restaurant is worth $330,000. The city’s appraiser valued the Monterey Street property at $97,000.
“My price (is) fair,” Dong said. “I can’t buy anything with ($97,000).”
For months, Dong had insisted his parcel was worth more, stalling purchase negotiations by not responding to the city’s offer to have the land reappraised. The former Leyon Restaurant operator claims similar Monterey Street properties have sold recently for $240,000 to $640,000.
“I worked hard. I paid everything – my taxes, my bills,” Dong said. “It’s not fair.”
Now, Dong feels vindicated, but his battles are not necessarily over. The city is required to negotiate the difference between the appraisal prices.
Bill Headley, the city’s manager of facilities development, said Dong’s appraisal is being reviewed by the city attorney and its appraiser. Headley said he was not surprised by the vastly different appraisals since professional opinions can vary.
“It hasn’t been entirely analyzed yet. We need to make sure we’re comparing apples to apples,” Headley said. “We may have radically different opinions about the condition of the building and its need for repairs.”
Dong says his building is in good shape, with the exception of the ceiling. He claims $2,000 to $3,000 of repairs would be enough to reopen the building.
Dong, a Gilroyan for 60 years, closed his restaurant more than nine years ago due to water damage. Dong said root systems from the city trees in front of his store destroyed his plumbing.
“If city don’t want to pay my price, I don’t want to sell,” Dong said. “If city don’t buy, I’m happy.”
But the city badly wants to buy Dong’s land. It sits where a garden, art gallery and part of a parking lot would go, once the arts and culture center gets built in 2008.
Dong is one of five property owners whose lots make up the 2.33 acres where the center would go. Thus far, only one owner – the Oyao family – has agreed to a price, $310,000 for two residential lots on Seventh Street.
Three other owners are in negotiations with the city. While a price hasn’t been reached with any of them, the city has yet to declare an impasse as they did with Dong.
The city’s next step is to negotiate with Dong and his appraiser, who could not be reached Wednesday for comment.
If the city and Dong cannot agree on a price, the city would then invoke its power of eminent domain.
Eminent domain is the procedure by which a public agency takes private land for an established fair market price.
“If this is litigated, I’d expect the court to set a price between the two figures,” Headley said.
The city has allocated $3.2 million for land purchases related to the arts and culture center, and $2.89 million remains after the Oyao agreement.
In other words, with 12 more lots to purchase from a total of four owners, the city has roughly $240,000 per property left to spend.
If Dong’s estimates on property values in the area are accurate, the city could find it difficult to please landowners with their offers.
“Acquisition of land is a process. It’s not an event,” Headley conceded Wednesday.
However, Headley sees things as moving forward positively.
“This is progress. We couldn’t get Mr. Dong to come to the table before,” Headley said. “It may not be the progress we hoped for, but we’re resolving issues. I’d say the glass is half full.”
Things could have been worse for the city. If Dong had agreed to let the city approve his choice of appraisers, staff may have been hard-pressed to reject the value figure or negotiate it down.
Dong, who speaks broken English, had difficulty explaining why he did not let the city approve the appraiser.
His daughter-in-law, Estelle Dong, has been representing him in front of the city. She also could not be reached for comment.
