10/13/2004

Freeport sees future in old town site
The Houston Chronicle, 10/10/04

But some plot owners say offer of $100 from city for their property is a 'land grab'

By Richard Stewart

For almost 40 years, the city of Freeport has been trying to buy
up almost 3,000 lots of privately owned land that city leaders say were part
of a land scam more than 100 years ago.

But some property owners say the real land scam is that the city is offering
them only $100 per lot in the big, undeveloped field on the north side of
the old Velasco town site.

Once the city acquires all the land, it plans to offer it to a developer for
a neighborhood of parks, lakes and upscale homes.

In the next few months, the city plans to take the last 140 holdouts to
court to seize the land through eminent domain and pay the $100 per lot -
all that was ever offered and the lots' longstanding assessed value on the
tax rolls.

"I'll sell them," Jeanne McKenzie said of two lots owned by her family. "But
$100 is ridiculous. The people who buy those houses sure aren't going to pay
$100 a lot for that land."

She said her family should get at least $1,000 a lot, and probably much
more.

The city is embroiled in another eminent-domain dispute on the waterfront.
It wants to create an upscale marina, but several shrimp-boat dock
facilities won't sell for the price the city is offering.

There are no landmarks to show the location of any of the 2,960 lots in the
400-acre field laid out by a land company more than a century ago. No
streets were ever put through, no water lines or sewers, no telephone lines,
and no electrical service. No houses were ever built.

The only way the property can be used, city officials said, is if the city
buys all the lots and combines them into one large parcel that can be
developed into a modern neighborhood - a neighborhood that will increase the
city's tax base.

Assessed value

But the offer of $100 per lot is one that McKenzie and other opponents said
virtually steals property from longtime owners to make a profit for the city
and developers.

"Now the city just wants to take it," McKenzie said, "and they don't want to
pay us anything for it. It's just a land grab."

Paying $100 for each of the lots is fair, said Mayor James Barnett, because
the land is now nearly worthless. Tax appraisers have long valued the lots
at $100 for tax purposes.

Freeport wants a developer to build a neighborhood of $80,000 to $120,000
homes. Only by doing that can the land have any value, Barnett said. If the
city had to pay much more than the assessed value, the new development plan
wouldn't be affordable, he said, and Freeport needs such development.

Most of the tiny 25- by 125-foot "town lots," as they were called when they
were sold by the Brazos Coast Development Co. between the 1890s and World
War I, were given as free premiums for people who bought 5-acre plots of
land farther out in the county, said Nat Hickey, Freeport's urban renewal
director.

"A lot of these people didn't even know they were getting town lots," Hickey
said. "There'd just be a little note at the end of their other deed saying
they also had a town lot."

And, because company salesmen would travel throughout the country selling
property, many buyers never saw the land they'd bought.

The town lots were a few blocks behind a new Velasco town site laid out by
developers in 1891. The new town was a few miles upstream from Velasco's
original site at the mouth of the Brazos River, where Surfside Beach is now.

Though the new town was in a more protected spot, it was still vulnerable to
storms. In 1900, it was wiped out by the same storm that devastated
Galveston. Another destructive storm hit in 1919.

Vacant land

Freeport, on the other side of the river, was founded in 1912 by the
Freeport Sulphur Co. and soon eclipsed its older neighbor. In 1928, the
river channel was moved west. What had been a river between the two towns
became a long, narrow tidal lake, now home to shrimp and charter fishing
boats.

Shortly before World War II, the federal government scooped up many of the
old 5-acre plots and combined them into areas where chemical plants now
sprawl.

Freeport and adjoining areas such as Lake Jackson grew. In 1957, Velasco
became part of Freeport.

Meanwhile, the 400 acres of town lots went undeveloped.

"Every now and then somebody would come up with an idea to do something with
them," Barnett said, "but nobody could get title to enough of them to do
anything."

Most of the lots passed from generation to generation of owners. Today, some
lots have 40 or more owners.

Most agree to sell

Acie Frizzell, who was Bill Frizzell's father and Jeanne McKenzie's
stepfather, bought two of the lots in 1973. He said he planned to build a
home there, but he died a few years later.

In 1966, the Texas Urban Renewal Act gave Freeport the power to acquire the
property through eminent domain condemnations.

Most landowners agreed to sell at $100 per lot, Hickey said, but the city
has been unable to find some owners and others have refused to sell.

About 140 owners are holding out, he said.

By the first of the year, the city is set to file eminent domain lawsuits to
try to take the rest of the lots for $100 each.

Getting the property is important for Freeport, Barnett said, because "it is
the last good-sized piece of property in Freeport that can be developed for
housing."

It is one of the city's two biggest development projects, and both have
become embroiled in eminent domain controversies.

Marina troubles

The city, through its economic development corporation, has contracted to
loan $6 million to investors to create a marina for upscale pleasure boats
along the old downtown riverfront.

Investors already own a big block of downtown land, but two companies that
operate shrimp boat dock facilities have refused to sell waterfront land for
what the city wants to pay.

A federal judge recently ruled that the city has the right to condemn the
property through eminent domain, but the issue is on appeal.

Making plans

An investor has not been chosen for the old Velasco town lots, but the city
has drawn up preliminary plans for the property.

They include a raised berm to provide a visual and sound barrier between the
area and a chemical plant that is just across a canal. Jogging and biking
trails snake for 3.6 miles along the berm.

The plan also calls for three lakes, a nine-hole golf course, a skating park
and a picnicking park.

McKenzie, who lives in a comfortable home in a nearby middle-class
neighborhood, said she agrees that the development plans look nice, but she
said her family shouldn't have to pay for them.

"I want Freeport to progress," she said, "but I don't want it to come out of
my pocket."


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