Officials: Concerns about Loudon land sale are unfounded

LOUDON - Concerns that a developer sold an 80-acre tract to the Loudon County School Board for a quick $900,000 profit are trumped up and unfounded, officials said.

The school board voted last summer to buy that tract along U.S. Highway 321 for a new middle school for $2.2 million.

Developer Richard Eisenbach earlier paid $1.3 million for 103 acres before selling most of the property to the school board and keeping 23 acres for future commercial development.

Those transactions prompted questioning by self-proclaimed citizen activist and former County Commissioner Van Shaver and also were discussed by board members in late October.

"An awful lot of people are asking an awful lot of questions down here," Shaver said.

Sparking concerns is that the land sales were recorded at about the same time in the Loudon County Register of Deeds office in late September.

"This whole thing has really gotten under my skin," Eisenbach said Friday of published reports about the transactions. "I sold the property at 20 percent below market value."

Eisenbach said he earlier purchased an 18-month option on the land and then invested in site work and plans for a commercial development and condominiums.

He said he spent a "six-figure" sum on the option and groundwork. "I took a significant risk at a time when nobody was interested in the property," Eisenbach said.

"The notion that I walked away with a $900,000 profit for a week's work is absolutely untrue," he said. "It wasn't me buying it one week and flipping it the next."

Since he purchased the option, a waterline was extended out U.S. Highway 321, and that increased the property's value, Eisenbach said.

Loudon County School Director Edward Headlee said the school board had for months been looking at several pieces of property for a new middle school. There is also talk of building a new high school there, he said.

Other possible tracts were higher priced, would require extensive site work or lacked utilities, Headlee said.

The board looked at other properties along Highway 321 priced from $30,000 to $35,000 an acre, Headlee said.

After doing an on-site inspection last spring, board members voted 8-2 to buy the land from Eisenbach for $27,500 an acre, he said.

Since the land deal has come under scrutiny, Headlee said he asked the county purchasing agent about the transaction.

Headlee said he was told the land was likely valued appropriately.

"What we paid for, it is in line with what other property is being priced," board member Bill Marcus said.

Freddie Gene Walker, who, with fellow school board member Leroy Tate, voted against the land buy, disagreed.

Walker said the board earlier decided not to buy a larger tract on Hines Valley Road that was cheaper.

"They kind of rushed that thing up (the Highway 321 land buy) and kept me and Leroy in the dark because they knew we were in opposition to it,'' Walker said.

"The man made a price, and the board voted to purchase it at that price," Headlee said.

"The man made a profit."