Star Valley will spend $16,000 in attorney fees to dismiss condemnation proceedings against the Payson Water Company if the town council approves a resolution Tuesday night.
In April, the council directed attorney Marvin Cohen to acquire the Star/Quail Valley System, and in May, Cohen filed a lawsuit in Gila County Superior Court.
The town expected to pay around $500,000 for the water company, but an appraisal convinced the council the cost would be greater than anticipated.
“The cost issue is foremost what derailed consideration of acquiring the system,” said Town Manager Tim Grier. “The cost was very different from what we thought it would be.”
The town had originally offered Brooke Utilities around $400,000 for the water company that serves about 300 Star Valley residents. But Brooke rejected that offer.
After Brooke released discovery documents, the council voted Sept. 2 to halt the condemnation proceedings based on figures that put the price of the system much higher.
Cohen said the documents released to the town’s appraiser three days before the condemnation court date indicated the water facility servicing Star Valley is newer than the average system owned by Brooke Utilities, and therefore more valuable.
Grier said no specific figure was put on the value of the system, but it was much higher than $400,000.
The resolution concludes the acquisition is no longer necessary and proposes dropping condemnation proceedings.
The cost to obtain dismissal could be around $16,000 in attorney fees, Grier said.
If the council approves the resolution, it will put an end to any plans to acquire the water company by court order.
The town cannot re-file a condemnation request for two years.
The town could still buy the water company, but it may not be for sale, Grier said.
“We are now looking toward the Blue Ridge Reservoir, which has opened up some new options,” he said.
The Jan. 6 council meeting takes place at 6:30 p.m. at the Star Valley Baptist Church, 4180 E. Highway 260.