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Ponderosa tract sells for minimum bid

August 29, 2012
By LARRY SHIELDS - Staff Writer (lshields@salemnews.net) , Salem News

YOUNGSTOWN - The front portion of Ponderosa Park was sold for $150,000, the minimum bid, during a sheriff's auction on Tuesday.

But the sale came during a second auction because the highest bidder, representing an undisclosed client, failed to produce the correct amount of money after the first auction, and a second auction was immediately held.

The auctions were held in the Mahoning County courthouse for the 45.45 acre section.

The park is located five miles north of Salem on state Route 45.

The bidding started at $150,000 and stood at $200,100 after Equity Portfolio, LLC, Ltd., representing the mortgage holder and high bidder on the back section of the park in a March auction, placed the ninth bid between the two bidders.

The other bidder, an undisclosed third party, bumped each preceding $100-incremental bid by Equity Portfolio with stepped increases of $9,900, finishing each round with a $10,000 increase.

The bidding reached $200,100 when the undisclosed bidder upped it by $49,900 to secure the winning bid at $250,000.

But there was a problem with the deposit and attorney Gary Rosati, representing Mahoning County as

the seller, said the "purchaser didn't have the deposit."

Rosati explained the winning bidder had a certified check in the amount of $15,000 which was 10 percent of the minimum bid, or two-thirds of the appraised value of $225,000.

He said the check should have been in the amount of $22,500 or 10 percent of the appraised value, leaving the bidder $7,500 short.

Before the auction bidders were advised they "must have 10 percent of the appraised value" to place on deposit if they won and an auction information sheet said "deposits are now required from both plaintiffs and third party purchasers at the time of the sale."

In underlined all-capital letters the sheet says, "The deposit for third party purchasers is 10% of the appraised value."

Rosati said he had to consult with his client, the Mahoning County treasurer, "to see if we're going to object to the procedure ... the $15,000 is 10 percent of the two-thirds appraised value and was rejected because he should have had a check for $22,500 or 10 percent of the appraised value."

He continued, "The irregularities during the sale, the original high bidder didn't have the proper deposit (and) I would have accepted, I was willing to go with the next-highest bid which was $200,100. I thought that would have been proper under the circumstances."

Rosati added, "I question whether the sheriff could reject it. Having a bad bidder, does the next highest bid have control?

"The sheriff could reject the sale, but there's a question of whether the bidding could be started over from scratch."

The auctions were held in the commissioners hearing room in the basement of the courthouse and the bidder representing the undisclosed client left the building in a hurry after the amount of the check was rejected.

Last March, the front 45.45 acre parcel was withdrawn from the auction at the last minute because of inadequate technical and legal descriptions on the land map.

Equity Portfolio, a Warren company, placed the top bid of $700,000 on the 68.37-acre rear tract in that auction.

The property had been appraised at $144,000 and the minimum bid was $96,000.

Based on the amount the back portion sold for Rosati had asked the sheriff to have the front section reappraised by the county but request was denied.

Consisting of about 141-acres, Ponderosa Park gained national fame as a country and western music hot spot and is located five miles north of Salem on state Route 45 in Goshen Township.

It also contained a campground.

The property was broken down into three large sections for auction to recover delinquent taxes of over $534,000 dating to 1989-90.

The second, more historic and valuable front section of the park was auction on Tuesday and includes an outdoor stage and a famous guitar-shaped swimming pool.

A third middle section consisting of the multi-deeded campgrounds won't be ready for auction for two years, Rosati said.

Rosati was hired by the county to foreclose on the property and assembled the auction data for the county "because of the extensive research" involved, Assistant Mahoning County Prosecutor Elizabeth Phillips said earlier this year.

She said the county didn't have the staff.

Before the first auction Rosati said the county was making no representation regarding the oil and gas leases.

The county board of health condemned the park in 2010.

 
 

 

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