Florence [Arizona] scoffs at mining company’s claim – by Christina Sampson (Casa Grande Dispatch – December 13, 2013)

http://www.trivalleycentral.com/casa_grande_dispatch/

Town manager calls Florence Copper’s filing ‘grandstanding’

FLORENCE — A claim for $403 million by Florence Copper, the company that wants to build an in-situ copper mine on 1,182 acres it owns off Hunt Highway, was termed “grandstanding” by Assistant Town Manager Jess Knudson in a Tuesday press release.

“The only reason to file a $403 million notice of claim to say you have a right to compensation in that amount is to grab a headline,” Knudson said in the statement.

In October, Florence filed a lawsuit in Pinal County Superior Court seeking a declaratory judgment that Florence Copper has no historic right to mine the land. Florence Copper responded to the town’s action by filing a compensation claim for the fair market value of the land based on an appraisal by Deloitte LLP, a third-party accounting and financial firm.

If the court rules that a historic right to mine does exist on the land, the town plans to condemn the land and take it by eminent domain. However, should that occur the town would have to pay just compensation for the land as determined in court.

Knudson said in the press release the Florence Copper appraisal is inaccurate. A separate independent appraisal commissioned by the town valued the land at $8.91 million.

Florence Copper purchased the land in 2009 for about $8.5 million.

Knudson told the Casa Grande Dispatch Tuesday the town’s independent appraisal results are based on the “existing (residential) zoning for the property for how it’s going to be used.”

Conversely, Knudson said, the Deloitte LLP appraisal is based on the land’s worth given a potential mining operation.
“That has nothing to do with market value, even assuming mining is legal,” Knudson said in the press release. “No one is going to pay $403 million today to get back that same $403 million by operating a mine, with all the risks and uncertainties that would entail.”

Florence Copper claims the town’s request for a ruling forced it to file the $403 million claim because under state law, the company had to respond to the town’s action within 180 days or it would essentially forfeit its right to file for damages from the town in the future.

Florence’s legal argument for a ruling is based on a 2007 zone change to the property.

A 2003 planning agreement with W. Harrison Merrill, the developer and former owner of the land, allowed a “mining overlay.” But in 2007, at Merrill’s request, the zoning was changed to residential and the mining overlay was removed.
Florence is arguing that when the town granted Merrill’s request to rezone the property, any mining or associated rights were abandoned.

Florence Copper claims it has a grandfathered right to mine the land based on a 2003 pre-annexation agreement, a claim town officials flatly reject.

“The town believes the (pre-annexation agreement) was effectively amended to remove any ‘mine overlay,’ to the extent it ever existed, and that (Florence Copper) has no legal right, ‘grandfathered’ or otherwise, to mine on the property,” the press release stated.

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