Meruelo Maddox $50,000,000 pay day courtesey of Villar's LAUSD School Board

This post may be toxic for the tax payers.

From the Downtown News.

The Los Angeles Unified School District has agreed to pay $50 million to settle an eminent domain dispute with Meruelo Maddux Properties over a 23-acre Cypress Park site, Los Angeles Downtown News has learned.

The agreement involving the property known as Taylor Yard comes about four years after the district sought to buy the land for $27 million, only to be eclipsed by a higher offer from Meruelo Maddux.The previously unreported agreement was approved in a closed session meeting of the board of education by a 6 to 1 vote on June 17.

That came more than two years after the district initiated eminent domain proceedings to acquire the property. A judge ruled in November 2007 that the district could take the land by eminent domain, but attorneys have since been debating what constitutes fair market value.

The district had long sought to buy the site and build a 2,200-seat facility to relieve overcrowding at nearby schools. The school board authorized the district to pay up to $29.4 million for the property at 2050 San Fernando Road, and in 2004 LAUSD negotiators offered $27 million, said Shannon Haber, a spokeswoman for the district's Facilities Services Decision. In March 2005, Meruelo Maddux bought the site for $31.8 million.

The $50 million settlement does not sit well with some, including Tamar Galatzan, the only member of the board of education to vote against the agreement.

"This is a lot of money for a property that the district could have purchased years ago and the run-up in price is based on the developer speculating that if the district didn't buy it, he could put a huge development on it and make double his investment," she said.

District officials in 2005 accused Meruelo Maddux (which was then a private company; it went public in January 2007) of swooping in at the last minute and snatching the property when the district was nearing its own deal.

Richard Meruelo, the company's chief executive officer - and a prominent Downtown landowner with close ties to Mayor Antonio Villaraigosa - has long countered that the district wavered for too long and he stepped in when the seller got anxious.

"LAUSD staff walked away from the property only to become interested again after a frustrated seller put it back on the market and re-approached the entities that had provided purchase offers nearly a year prior," the company said in a statement to Downtown News last week.

One needs to launch a corruption probe into this sweetheart deal for Meruelo. Further, for months 55 gallon drums were stored on this site, exposed to the elements. What was inside those drums? That question needs answering.