Jeff Lambert: Board of Natural Resources needs to revisit Spokane land exchange

The 200-acre Thorpe property in the Latah Valley was rushed into a land exchange by Hilary Franz in her last weeks as the state’s commissioner of public lands. In the coming days, the Board of Natural Resources has opportunity to fix that mistake.

The Department of Natural Resources manages a real estate portfolio that has two priorities: creating revenue for the trust to construct public schools and protecting Washington’s natural resources. To achieve those goals, the state can trade properties or use the Trust Land Transfer option.

Despite the Thorpe property being on the Trust Land Transfer list, on Jan. 7 the Board of Natural Resources approved trading it for property in Bellingham. The exchange was based on a $8.4 million value for the Thorpe property plus DNR paying at least $7 million more for a total of $15.4 million for a property currently housing a Haggen grocery store in Bellingham. Conflicting appraised values along with bad arithmetic on stated return on investment presented to the board should be enough to terminate the agreement and get proper evaluations of risk and reward.

Adjusting the DNR’s real estate portfolio to maximize income for the beneficiary trust makes sense to increase income and improve DNR’s management efficiency. The best option to surplus DNR property with poor income production is to transfer the property to a local government via the Trust Land Transfer program. The full property value is paid to the DNR with the funds restricted for the beneficiary’s use. Everyone wins with the beneficiary trust being able to buy income producing real estate and the local agency obtaining a much-needed park or conservation area.

In September 2023, the city of Spokane proposed using the transfer process to acquire the Thorpe property as a park and natural area for the city in an area bereft of parks. The Thorpe property has expansive wetlands, basalt cliffs, endangered forest habitat and four rare plant communities as identified by the DNR’s Natural Heritage Program. The extensive mima mounds are a mysterious geological oddity undisturbed by farming or clearing. Spokane conservation groups envisioned the property becoming a nature education mecca with ecological types not otherwise found inside the city of Spokane. After review, the DNR approved the Thorpe property as a Trust Land Transfer candidate and determined it met the best interests of the Thorpe beneficiary, the K-12 education trust. While Thorpe was not ranked in the funding range for 2025, the expectation is the property transfer would be funded in the future.

Despite being on the TLT list, there was a rush to exchange the property with the developer. The Thorpe exchange process was not fully documented and transparent. New information about financial risk of the exchange raises questions about whether the board had all the information it needed to make the best decision. Recently conservation advocates have become aware of the termination option that expires on April 6.

DNR had already approved a safe solution in the Trust Land Transfer option that would transfer the property to the city of Spokane after the Legislature compensates the trust for its full value of $8.4 million. Those funds would be used to buy replacement lands and DNR would be able to choose the best investment property.

DNR’s hasty comment period from late October through mid-December last year resulted in hundreds of comments criticizing the exchange. The comments at the Dec. 4 public hearing were unanimously opposed to the exchange and supportive of the transfer option. The Spokane City Council passed a resolution calling for the Board of Natural Resources to delay the vote to ensure the right decision.

Current Public Lands Commissioner Dave Upthegrove was not in office yet and did not get a chance to review the Thorpe exchange before the board voted on Jan. 7. However, he can put the termination option on the board’s April 1 agenda and stop the exchange. The pause would allow a real discussion to determine whether the best option is to exchange or transfer the Thorpe property for the beneficiary trust, DNR, and Spokane residents.

The Board of Natural Resources should join state Sen. Riccelli, state Rep. Natasha Hill, Spokane elected officials, the Spokane Conservation District, and more than 25 local conservation nonprofits and businesses to terminate the exchange at its April 1 meeting in order to consider the benefits of the Trust Land Transfer program.

Jeff Lambert, of Spokane, is president of Friends of the Bluff.