Affordable housing advocates backed by the city of Ketchum are still trying to purchase three apartment buildings held over from a drug forfeiture auction last week, and the federal government is still trying to find its ideal buyer.
Rebekah Helzel, founder of Ketchum-based Advocates for Real Community Housing, placed the highest bid in an Oct. 4 auction for the three buildings, known as the Bavarian Village, but was quickly informed by the auctioneers that the bid came up short. The Internal Revenue Service and EG&G Tech Services, the private contractor handling the auction, claims the undisclosed minimum bid on the property is $3.5 million. Helzel bid $2.3 million.
Jean McNeil, a spokeswoman for the U.S. attorney's office in Idaho, said Tuesday that her office is communicating with both public and private parties, including the city of Ketchum and ARCH, about selling the property. McNeil would not name the other parties involved.
Last week, Helzel and Ketchum city officials expressed confusion and anger towards the IRS and the U.S. attorney's office and questioned the motives of the botched auction. There were whispers that the property was never actually appraised and was significantly overpriced; open houses were never provided; and the auction was intentionally kept quiet for months to prevent a public rally in support of affordable housing. The city of Ketchum did not learn about the sale until late September, leaving just three weeks to muster financial support to purchase the buildings for affordable housing, which is at a shortage in the Wood River Valley.
Following the auction last week, Anthony Pounders, an operations manager with EG&G, said he felt the affordable housing issue "gave some of the developers second thoughts," and "had a lot to do with recent press."
Helzel could not be reached for comment on Tuesday.
McNeil would not address the accusations, saying only that "we're at a point where the negotiations are ongoing and sensitive, and I don't want to respond to things that have been said in the past. We're trying to operate in good faith. We don't want to get into a he-said, she-said (situation)."
Ned Williamson, lead attorney for ARCH, was also hesitant to discuss the issues following the auction.
"You know I don't believe it would be productive right now to dwell on those points," Williamson said. "It would be best to (focus on) a potential arrangement where community housing can be put in place and satisfy the needs of all the parties."
As for the chances of ARCH purchasing the Bavarian property, Williamson said he is "cautiously optimistic."
He added that "we're in very preliminary discussions but it seems to make sense that something can happen."
McNeil said that more will be known on Friday when the U.S. attorney's office "has an important call scheduled."
Williamson said he and U.S. Attorney Tom Moss, representing Idaho, have plans to talk on Friday.
The Bavarian Village is located on the corner of Rember Street and Bird Drive in West Ketchum. The three apartment buildings were seized several years ago after the owners, Patrick O'Malley Cannon, of Ketchum and California, and David Stanley Brocklebank, of Hailey, were arrested in an international drug-smuggling scheme. The buildings, which contain 14 residential units, were officially forfeited in February of 2004 when both men were sentenced to 40 months in prison for money laundering and conspiracy to smuggle and distribute drugs.