Walton County still negotiating multimillion-dollar Eastern Lake purchase; deadline looms

DeFUNIAK SPRINGS — With a Dec. 31 deadline looming, Walton County is continuing to negotiate the potential purchase of a 3-acre tract of beach between Eastern Lake and the Gulf of Mexico near the Seagrove Beach community.

For the county, acquisition of the acreage would be a significant addition to public beach access. Most of the 26 miles of beach in the county is privately held and off limits to the general public, except for a right to cross private beaches along the wet sand.

From October: Is 3 acres of Walton County beach worth $18 million?

Additionally, Eastern Lake is an ecologically rare dune lake. Part of its uniqueness is that, along with other dune lakes in the county, it exchanges water with the Gulf via an outfall crossing the sand that links the two bodies of water.

At their Tuesday meeting, commissioners unanimously authorized Commission Chairman Mike Barker and interim county counsel Clay Adkinson to continue talking with property owner Peter Russell and his counsel, local attorney Gary Shipman, to try to reach a deal for the tract.

Russell has set a Dec. 31 deadline for coming to terms with the county or the land will no longer be up for a deal. If the county does reach a deal with Russell, the purchase would be funded with reserves from proceeds of the tourist development tax collected in the southern end of the county.

The 5% tax, collected on accommodations and paid by visitors, raises millions of dollars each year. The money is used for property purchases for tourism-related purposes as well as to fund a lifeguard program, operate a visitor center and market the county to potential visitors.

At issue in the potential purchase of the property thus far has been the wildly differing appraisals that the county and Russell have obtained. The county's appraisal places the value of the land at $6 million, while Russell's appraisal sets its value at $18 million.

According to Shipman, Russell's original intent was simply to offer to sell the tract for $12 million, the midpoint between the county's appraisal and his own appraisal.

On Tuesday, though, Shipman told the commission that his client would be willing to sell the tract for $10 million as long as the county agreed to his $18 million appraisal. The county's acceptance of the $18 million appraisal would allow Russell to claim a tax deduction for what would, at least on paper, be an $8 million charitable contribution to the county.

That proposal was the same deal Russell and Shipman had presented to Barker and Adkinson during an earlier meeting between them that had been previously authorized by the commission.

Adkinson on Tuesday offered a cautionary note to commissioners, telling them that, in effect, the county would have to view such an arrangement as an $18 million purchase.

Barker on Tuesday called the prior meeting with Shipman and Russell "a very good discussion," but also told his colleagues that he "made it clear to Mr. Russell and Mr. Shipman that my input was strictly my input (and) ... that I didn't speak for any other commissioner."

Background: Could Walton County use eminent domain to obtain 3-acre beach property?

Commissioners on Tuesday left little doubt that they want the property, but they continued to balk at the $10 million effective price tag from Russell.

"I would love to have the property," said Commissioner Tony Anderson, whose district includes Seagrove Beach, "... but I think he needs to come down more."

"I want the property in the worst sort of way, but I'm not going to go over $9 million," Commissioner Danny Glidewell said.

Commissioner William "Boots" McCormick said $10 million would be a deal-breaker for him.

As discussion wore on, commissioners asked Shipman to telephone Russell to find out if there might be some deal that could begin to come together. Shipman agreed, and after a private conversation with his client, came back and told commissioners that Russell was willing to go down one of a couple avenues.

One of Russell's proposals was to sell the tract for $10 million, with $8 million up front and the remaining $2 million to be paid over the coming two years. Or, Shipman told commissioners, Russell would take a $12 million deal for the property, with $8 million up front and the remaining $4 million to be paid over the next five years.

In the end, commissioners voted to have Adkinson and Barker continue to negotiate with Shipman and Russell with an eye toward getting a deal done prior to the Dec. 31 deadline.

Doing so, however, will require the county to hold a public hearing and vote on any proposed deal at their Dec. 28 meeting.

Technically, the purpose of that meeting will be to amend the county's budget to accommodate a purchase of the tract. The required public advertising of the meeting, which will have to appear days in advance of the session, will have to include the specific amount by which the budget will be amended. That advertisement would, in turn, tip Russell off in advance as to how much the county is willing to pay for the beach property.

Meanwhile, the commission's hard line on a price left some of the people attending Tuesday's meeting dumbfounded, particularly given the millions of dollars raised each year with the 5% tourist development tax.

Barbara Morano, who lives near the beach and is active in local government issues, pronounced herself "flabbergasted" that commissioners weren't willing to strike an immediate deal with Russell.

Robin Haynes told commissioners that Russell "has come to an amount (a purchase price for the property) that I'm shocked that he's at."

Previously: Walton County and Eastern Lake beach parcel owner still millions of dollars apart

She suggested that it made little sense to stop a deal over a $1 million difference — the $9 million that Glidewell indicated he was willing to pay and the $10 million in Russell's proposal — in light of the money that could be made by vendors offering chairs, umbrellas and other goods and services to beachgoers at a public beach.

"You're going to stop a deal over a million dollars when you would be bringing in hundreds of thousands of dollars in revenue for local businesses," she scolded commissioners.

As discussion wound down Tuesday, Shipman said Russell's preference would be for the county to get the property. But he added that his client is nonetheless looking at the issue as strictly a business transaction, and "if a deal doesn't work for both sides, it doesn't work."

This article originally appeared on Northwest Florida Daily News: Walton County officials continue to negotiate Eastern Lake beach deal