Letters to the Editor

Letter to the Editor | Issues surrounding the 14-acre parcel

Issues Surrounding The 14+ Acre Parcel 

A review:

1. PenMet attempted to purchase the 14+ acres from the prior owner, but failed
2. ZTM bought the 14+ acres from the Tyson family for $1,000,000
3. PenMet had the 14+ acres appraised at $2,490,000 and offered that to ZTM
4. ZTM also had the property appraised for $8,105,000
5. ZTM wants an operating lease for the 71 acres so it can continue to operate the golf course
6. PenMet believes it should offer the lease in an open bidding showing both proven capabilities and financial resources

Questions

1. Why would the Tyson’s sell an $8.105M property for $1M?
2. Would ZTM be willing to purchase the 71 (see below) acres at the same per acre price as its appraised value for the 14+ acres?
3. Would ZTM agree to limiting the use of the combined acreage as a golf course?

Origin of the 14 Acres

The original lease agreement between the City of Tacoma and Denmark, Inc. (predecessor to Tyson) (the “Lease”) describes the land being leased as having 71 acres. The Lease mentions, in paragraph 2, the need to acquire 29 additional acres to get the total acreage for the proposed golf course up to 100 acres.  That purchase was Denmark’s sole responsibility and a condition to the lease.

Interesting Legal Question

Could Tacoma be considered a third party beneficiary of the 14 acre purchase allowing it to enforce the use of the 14 acres as a part of the Madrona golf course? If so, PenMet would succeed the City in that position.

Tyson’s Sale to ZTM Holdings

Tyson sold the 14 acre parcel to ZTM by a Deed, recorded on 01/02/2024 with a $1,000,000 sales price as shown in the Tax Affidavit also recorded on 01/02/2024.  Why didn’t they sell to PenMet (probably for more money based on PenMet’s offer to ZTM) to simplify the ownership and further secure Madrona’s future as a golf course?

Open Space Agreement

Tyson also recorded an Open Space Taxation Agreement on 11/03/2015. This Agreement states that Tyson agrees to keep the 14 acres as “open space” to achieve a reduction in property taxes. Here’s what Tyson said in this Agreement:

“…both the owner (Tyson) and granting authority (Pierce County) agree to limit the use of said property, recognizing that such land has substantial public value as open space and that the preservation of such land constitutes an important physical, social, esthetic, and economic asset to the public, and both parties agree that the classification of the property during the life of this agreement shall be for (and “Open Space Land” is checked).

So, what’s the term of this Agreement?  The term ends when “…the property is withdrawn or removed from classification.”  This Agreement also binds all “successors” to the parties.  ZTM is a successor to Tyson and is bound by this Agreement.  ZTM may withdraw the land from this Agreement by requesting it, but it appears that request might take two years to be effective.  The Assessor would also assess all taxes due plus interest coming from that withdrawal.  It would be interesting to know if ZTM has made that request.  

Questions About the Total Acreage

PenMet’s website indicates that PenMet purchased approximately 80 acres from the City of Tacoma.  That property is parcel #0221204092.  The County Assessor shows the property to be 79.73 acres.  Absent some subsequent acquisition, it seems the 71 acres mentioned in the Lease was in error?

Tyson fulfilled, partially, its obligation to purchase additional acreage to make the golf course feasible.  Its obligation was to accumulate 100 acres, and they accumulated approximately 95 (using the 79 acre number).

The National Golf Foundation, a golf course consultant, found Madrona to include a 71 acre parcel and a 14 acre parcel or 85 acres in total.   Are the Pierce County Records accurate or not?  I only mention this for valuation purposes.  This discrepancy needs to be investigated.

ZMT Request for An Operating Lease

I fully support PenMet’s position that it should offer the operating lease to public bid and should conduct sufficient due diligence to determine the operating lessee’s experience, competence and financial resources.  I would expect nothing less from PenMet being a publicly supported entity and given the dollar amounts involved.

PenMet’s Appraisal

Kidder Mathews said:

The intended use of this appraisal is for possible condemnation purposes.

Kidder Mathews also addresses the issue of its appraisal of $2,490,000 versus ZTM’s purchase of the parcel from Tyson for $1,000,000:

The sale price is less than the concluded market value of the property, since the sale was likely based more on continued use as a portion of the larger Madrona Links Golf Course than as land available for redevelopment to its Highest and Best Use as concluded by the appraisal.

Would PenMet exercise its eminent domain powers to get the 14 acres?  If so, what would the price be?

Craig McLaughlin

Fox Island

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