Jeff Jardine

Hurrying up to wait for $509k settlement between Riverbank, auctioneer

jlee@modbee.com

Most anyone who ever spent time in the Army is familiar with the sarcastic term “hurry up and wait.”

In Riverbank, that saying is worth over a half-million bucks.

In 2010, when Riverbank’s Local Redevelopment Authority got the keys to the old Army ammunition plant, it hired a company to inventory all of the items and equipment in the massive plant that made shell casings from World War II through Operation Desert Storm. They signed a one-year agreement with Stuart B. Millner & Associates, an auctioneer based in Missouri, to sort out and sell the stuff. The authority would receive 90 percent of the sale price per item. Millner could charge a 15 percent fee to each buyer.

There was, however, a caveat: The items could not be sold until the authority received a bill of sale for the surplus equipment from the Army (even though the Army was giving it to the authority).

Much of the equipment in the old plant was contaminated and sent to a landfill, said Debbie Olson, the redevelopment authority’s executive director. Other pieces, such as presses used for machining, were good and are being leased to tenants.

The remaining surplus items included copper wiring, equipment and other materials, Olson said, which were cataloged by the auctioneer. The contract includes language that states the authority expects to receive “a bill of sale for the surplus equipment in the near future, followed by the transfer of the property to the LRA ... .” But instead of waiting for the go-ahead, the auctioneer began selling the materials. The sales totaled $509,311, which now sits in an account controlled by Millner & Associates. The firm provided to the authority a detailed accounting of the items it sold and how much each item generated.

“It truly was a misunderstanding,” Olson said. And remain so.

Unable to resolve their dispute, Olson and the Local Redevelopment Authority hired a law firm to resolve the issue. So did Millner. Five years later, they still are in limbo. Why? This where the the Army’s “hurry up and wait” mind-set comes into play. As part of the military downsizing and base closure program that began during the Clinton administration, the Army agreed to turn the facility over to the city of Riverbank and its Local Redevelopment Authority. It allowed them to take possession of the plant and everything in it more than six years ago.

But because the Army never formally deeded over the property to the authority, the authority can’t sue the auctioneer to get the money. In fact, technically, the Army – not the Local Redevelopment Authority – still owns the items sold by the auctioneer. The Army has better things to do than sue over stuff it had written off when it turned over control of the plant to Riverbank.

“They said, ‘We don’t want to pursue this. We don’t see anything of value, You will have to pursue this.’ ” Olson said.

That’s something the authority can’t do until it has the deed to the plant in hand, and the Army is in no hurry to put it there. In other words, the “hurry up and wait” to own the place is synonymous with the “hurry and and wait” to settle the disagreement with auctioneer.

“Our mantra throughout this has been: To the Army, it’s not a problem. It’s just process,” Olson said. “They’re thinking, ‘How many calories are we going to burn on that, since we have so many other things going?’ They graciously allowed us to do a great deal without the deed.”

Except for the stuff it can’t do without it, meaning to end the dispute with Millner. The initial contract expired March 31, 2011. Because both parties recognize the dispute and the need to resolve it, they’ve renewed the contract every year for another year. On Tuesday, the contract renewal appeared on the Riverbank City Council’s consent agenda and was rubber-stamped with several other items. Millner’s attorney in Missouri didn’t return my call. No matter. Olson said it will be resolved someday.

In the meantime, the Local Redevelopment Authority and auctioneer will simply have to hurry up and wait, just like they do in the Army.

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