Hawkins Companies, LLC v. State of Idaho

554 P.3d 74
CourtIdaho Supreme Court
DecidedAugust 13, 2024
Docket51788
StatusPublished

This text of 554 P.3d 74 (Hawkins Companies, LLC v. State of Idaho) is published on Counsel Stack Legal Research, covering Idaho Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Hawkins Companies, LLC v. State of Idaho, 554 P.3d 74 (Idaho 2024).

Opinion

IN THE SUPREME COURT OF THE STATE OF IDAHO

Docket No. 51788-2024

HAWKINS COMPANIES, LLC, an Idaho ) limited liability company; PACIFIC WEST ) COMMUNITIES, INC., an Idaho ) Boise, August 2024 Term corporation; and FJ MANAGEMENT INC., ) a Utah corporation, ) Opinion filed: August 13, 2024 ) Petitioners, ) Melanie Gagnepain, Clerk ) v. ) ) STATE OF IDAHO, acting by and through ) its DEPARTMENT OF ADMINISTRATION, ) acting as the statutory agent for the STATE ) OF IDAHO TRANSPORTATION ) DEPARTMENT; and the IDAHO STATE ) BOARD OF EXAMINERS, ) ) Respondents, ) ) and ) ) MIKE MOYLE, in his official capacity as ) Speaker of the House of Representatives of ) the State of Idaho; and the IDAHO HOUSE ) OF REPRESENTATIVES, ) ) Intervenor-Respondents. ) )

Original proceeding in the Idaho Supreme Court seeking writs of prohibition and mandate.

Petitioners’ Verified Petition for a Writ of Prohibition and a Writ of Mandate is dismissed.

Clark Wardle LLP, Boise, for Petitioners. T. Hethe Clark on the briefs.

Raúl R. Labrador, Idaho Attorney General, Boise, for Respondent Idaho State Board of Examiners. Alan Hurst on the briefs.

Naylor & Hales, P.C., Boise, for Respondents Idaho Department of Administration and Idaho Transportation Department. Joan E. Callahan on the briefs. Hilty, Bower, Haws & Seable, PLLC, Nampa, for Intervenors-Respondents Mike Moyle and the Idaho House of Representatives. Mark Hilty and Daniel W. Bower on the briefs.

ZAHN, Justice. This original action concerns whether business entities that were the high bidders for surplus state property, but do not have a legally enforceable contract or a clear statutory right to purchase the property, have standing to file an original action to force the Idaho Department of Administration and the Idaho Transportation Department to sell the property. For the reasons discussed below, we hold that they do not and therefore dismiss the Petition for Writ of Prohibition and Writ of Mandate. I. FACTUAL AND PROCEDURAL BACKGROUND This case concerns real property owned by the Idaho Transportation Department (“ITD”), located at 3311 West State Street in Boise (“the ITD Campus”). In January 2022, the largest building on the ITD Campus flooded, rendering the building unusable. The flooding exposed fireproofing material that contained asbestos. Any repairs to the building would have to include the remediation of the asbestos. Approximately 600 ITD employees worked in the building. In March 2022, the legislature appropriated $37 million to the Idaho Department of Administration so it could make improvements to the State of Idaho’s Chinden Campus, located in West Boise, to enable the relocation of ITD employees to that location. In April 2022, the Idaho Transportation Board (“ITD Board”) approved a plan to move the ITD employees to the Chinden Campus. On August 5, 2022, the ITD Board approved a resolution declaring the ITD Campus as surplus property and transferred custody and control of the property to the State Board of Examiners pursuant to Idaho Code section 67-5709A. That statute governs the process for the sale, transfer or disposition of state administrative facilities and provides: When a state agency declares that a state administrative facility is not needed or is unsuitable for its purposes, custody and control shall be transferred to the state board of examiners, which shall immediately transfer authority for the disposition of the property to the department of administration which shall send a notice to all state agencies and institutions that the property is available for other state use. Any state agency interested in leasing or buying the property shall notify the department of administration within the time the department specifies. If no state agency or institution is interested, the department shall obtain an appraisal and commence procedures to sell the property for the highest price possible. All proceeds from the sale or lease of administrative facilities acquired by

2 the department of administration pursuant to this section, other than proceeds required by law to be deposited in a special fund, less the department of administration's cost of selling or leasing, shall be deposited into the permanent building fund for the purpose of holding such proceeds. Such proceeds in the permanent building fund acquired pursuant to this section may be expended pursuant to appropriation. I.C. § 67-5709A. Pursuant to this statute, the State Board of Examiners transferred authority for disposition of the ITD Campus to the Department of Administration. On August 17, 2022, the Department of Administration, consistent with section 67-5709A, sent notice to other state agencies, advising that the ITD Campus was available for purchase. No agencies expressed interest in the property. The Department of Administration thereafter obtained an appraisal of the property, which estimated the property’s market value as $38,620,000. In April 2023, the legislature appropriated $15,000,100 to the Department of Administration to make additional improvements to the Chinden Campus for purposes of relocating the Idaho State Historical Society’s preservation facility from the ITD Campus to the Chinden Campus. In that same legislative session, the legislature also appropriated nearly $3,000,000 to ITD for costs associated with relocating to the Chinden Campus. In May 2023, the Department of Administration opened a request for proposals from private entities for the purchase of the ITD Campus. The Department of Administration received nine proposals. The record suggests that there were multiple rounds of bidding. In a letter dated September 25, 2023, the Department of Administration advised Hawkins Companies, LLC, Pacific West Communities, Inc., and FJ Management Inc. (collectively “Petitioners”) that their bid was selected as “the winning proposal” for the purchase of the ITD Campus. Petitioners’ winning bid was for $51,750,000, which exceeded the appraised fair market value of the property. The Department of Administration advised Petitioners that it would send a draft purchase and sale agreement for their review. The letter closed with a statement that the Department of Administration had not yet made a formal offer to sell the property to Petitioners: Please note that the delivery of this letter and a draft purchase and sale agreement does not constitute a formal offer to sell the property. The sale of the property is subject to a fully executed purchase and sale agreement. Over the course of the next six months, Petitioners and the Department of Administration negotiated the terms of the purchase and sale agreement for the ITD Campus. In March 2024, the parties arrived at a mutually agreed upon purchase and sale agreement. Petitioners signed the agreement and sent it to the Department of Administration on March 21, 2024.

3 During this same timeframe, members of the Idaho Legislature publicly declared their concerns with the sale of the ITD Campus. A member of the Joint Finance Appropriations Committee (“JFAC”) stated that he and other members of JFAC had been advised by an ITD working group that the estimated proceeds from the sale of the ITD Campus would be $80 to $100 million. During the 2024 legislative session, the legislature attempted to repeal section 67-5709A, but the bill never made it to the Senate floor for a vote. JFAC inserted language into the appropriations bill for the Department of Administration that revoked the Department’s authority to dispose of the ITD Campus and directed that custody and control of the property be transferred to the ITD Board: Section 4. DISPOSAL OF PROPERTY. Notwithstanding any other provision of law to the contrary, the authority of the Department of Administration to dispose of the state administrative facility and property at 3311 W State Street, Boise, Idaho, 83703 is revoked.

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Bluebook (online)
554 P.3d 74, Counsel Stack Legal Research, https://law.counselstack.com/opinion/hawkins-companies-llc-v-state-of-idaho-idaho-2024.