EAST BATON ROUGE PARISH, LA (WAFB) - The Legislative Auditor's Office found the City-Parish of East Baton Rouge may have violated state law when it sold two pieces of surplus real estate for less than their fair market value in land deals that raised eyebrows when they came to light in 2017.
On Monday, Louisiana Legislative Auditor Daryl Purpera released the details of his investigation into four land deals, two of which appear to violate applicable state laws. Both were sold to developer, Radu Cosman, for amounts well below their fair market values.
The first deal occurred in late 2013 when Cosman approached the city about purchasing a 22,000 square foot tract along Bluebonnet Boulevard. Cosman gave the city his own appraisal, which valued the property at $42,000, but the city obtained another appraisal that valued it at $255,000. Despite this, Cosman bought the property at auction for only $50,000 because the city failed to set a minimum sale price, according to the Legislative Auditor's Office.
The second property purchased by Cosman was a 1.2 acre tract located on the southwest corner of Bluebonnet Boulevard and Jefferson Highway. He bought the land at auction for only $10,000 in December of 2016.
Purpera's office found the city got the property appraised only after the sale. It was valued at $605,800.
When asked why the city failed to appraise the land before putting it up for auction, the special assistant city-parish attorney told investigators he thought the land was worthless and didn't want to waste money on an appraisal, Purpera's office said.
Two other sales the legislative auditor investigated also concerned land sold below fair market value. One was a 12,600 square foot tract located along Bluebonnet Boulevard that sold for only $5,000 through a private sale. Again, the city failed to have the property appraised prior to the sale and instead accepted the purchaser's own appraisal.
The other was a tract that sold for $70,000 less than the fair market value.
Despite their findings, the Legislative Auditor's Office found those two sales appeared to comply with state law.