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Businessman Thinks Ky. Owes Him More For Property

The Associated Press

OWENSBORO, Ky. (AP) — Danny Falloway grew up in the auto salvage business.

His father, Delbert, opened Falloway Auto Parts on Bluff Avenue around 1947, when Danny Falloway was a baby.

In 1980, Falloway moved his family business to a 5- to 6-acre lot at what's now 5820 Kentucky 2830 near Hawesway Truck Plaza.

"I've been in it my whole life," he said Tuesday.

Until last summer, anyway.

That's when the Kentucky Transportation Cabinet took Falloway's land for the U.S. 60 bypass extension.

"We first started hearing rumors about this in '02," his son, Ronnie, who owns Falloway Auto Sales, recalled as he looked over aerial pictures of the property in eastern Daviess County.

The letter from the state came on Christmas Eve 2007, telling him that the state wanted his property, Danny Falloway said.

"I paid $130,000 for that property with nothing on it nearly 30 years ago," he said. "But I had added buildings, concrete and a gravel fill four feet deep. They wanted me to take $144,000 for everything. They didn't even want to pay for my fence and the materials alone cost $50,000."

Falloway said he looked for property to move his business to but couldn't find anything he could afford.

"We found 3.5 acres about a mile away, but they want $200,000 for it and there's nothing on it," Ronnie Falloway said.

"I told them: 'Buy me some property to get me back in business'" Danny Falloway said. "But they just laughed at me."

Falloway said the state "got a court order last spring that gave me 60 days to clear it off. I had almost 2,000 vehicles in there. I had to sell them off so quick, I got $100,000 for cars that should have brought half a million."

To start another salvage yard, he'd have to restock with cars. "It would take me 10 to 15 years to start making money again," Falloway said. "I'd be looking at the better part of half a million dollars to start over somewhere else. And I'm 63."

One reason his property was valued so low, he said, was that it was zoned for agriculture, not heavy industry. The salvage yard was grandfathered in as an existing business when the zoning laws were adopted, Falloway said.

"I was offered $500,000 for the salvage yard earlier and turned it down," he said.

"I had just paid off a $70,000 loan on part of the property," Falloway said. "Now, I can't get a loan without collateral and I'd need to cash that check to have collateral."

A check for $144,000 is waiting for him at the courthouse, he said.

But Falloway thinks his property is worth at least $300,000 and plans to take the state to court to try to get it.

So, he's refusing to accept the check.

Chuck Wolfe, spokesman for the state transportation cabinet, said with a lawsuit pending in the case: "I would have to decline comment about that case specifically. But I can provide some information about the process generally."

Condemnation cases are common in transportation development, he said.

"First comes an offer from the state to the property owner," Wolfe said. "If the owner rejects the offer, the cabinet files a condemnation action in circuit court.

"The court appoints three commissioners to view the property and place a value on the acquisition."

Then the transportation cabinet "posts that amount of money with the court and requests a 'right of entry,' which, as the term implies, legally allows for possession of the property," Wolfe said.

"The court will grant right of entry if the owner has not filed a challenge to the cabinet's right to take the property.

"The owner may withdraw the amount of the commissioners' award. Withdrawing the award does not mean that the owner agrees with the amount of the award. Typically, the state continues to seek an agreement through negotiation. Failing all else, the matter goes to trial and a jury decides the price."

Wolfe said: "The cabinet will work to help a property owner relocate. Assistance may include helping find alternative property, getting cost estimates to move, etc. After the cabinet gets possession of the property, notice is given to vacate the property.

"Only when the owner fails to follow the orders of the court does the cabinet move to evict."

"It's hard for me to believe that the state can just come in and take a business without putting you back like you were," Ronnie Falloway said. "But that's what happened to us."

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Information from: Owensboro Messenger-Inquirer, http://www.messenger-inquirer.com