Arbitrators have decided that 115 acres on which part of Blue Grass Airport's new general aviation runway sits is worth $3.165 million.
The binding decision, made late Tuesday, marks the end of a long dispute between Elkhorn Bend LLC, which had owned the property, and the airport.
"We believe it's representative of the appropriate price for the property," said attorney Robert Maclin, who represents Elkhorn Bend, owned by Nick and B.J. Bentley. "We're very pleased it's consistent with the market price in the Versailles-Lexington Road corridor."
He said it is unfortunate that his client has had to wait so long and spend so much money on litigation.
"I think it's good to put this behind us," said airport attorney Tom Halbleib. "This basically resolves all the litigation the airport has had pending."
Airport officials announced the arbitration settlement Wednesday following a closed session of the airport board at the end of its regular monthly meeting.
Blue Grass Airport took over the property, acquired through condemnation, in December 2008. Court-appointed appraisers deemed that the airport had to pay $1,686,000. The airport and Elkhorn Bend agreed to let arbitrators, rather than a jury, decide later what the final price would be, Maclin said.
The airport will have to pay 6 percent in interest on the nearly $1.5 million it still owes for the parcel, with the time period for interest accrual starting in December 2008, Maclin said.
In January 2005, Elkhorn Bend bought the property under an option agreement in existence since the late 1990s, paying about $748,000. As part of the agreement, the Bentleys agreed to split any net profits and operating revenues made from the property with bloodstock agent Wayne Murty, who had operated a horse-boarding establishment there.
Plans were for the property to become an equine air transport and quarantine facility, Maclin said. He said his client did not acquire the land with the idea of selling it to the airport.
A real estate appraisal firm hired by the airport board valued the property at $1.725 million in May 2006. A couple of years earlier, Elkhorn Bend wanted $30,000 per acre, or $3.45 million, for the land.
The arbitrators — three certified real estate appraisers — considered December 2008 appraisals each side obtained for the property. The airport's appraisal was $1,450,000, while Elkhorn Bend's appraisal was $6,330,000. The arbitration process included tours of Elkhorn Bend and other properties used in coming up with the appraisals for it, and about a day and a half of testimony.
Maclin said the airport board is paying a fair price for the property.
"That's all Mr. Bentley ever requested," he said.
Airport board chairman J. Robert Owens said that the appraisers were very capable and that he believes they came up with a fair value.
"I would have liked to have paid less money for it, but I'm happy that it's all over with and we've got this case settled," he said.
The property is where 49 people died in August 2006 in the crash of Comair Flight 5191, whose pilots took off from the wrong runway.
The airport's new $27 million, 4,000-foot-long general aviation runway was unveiled last month.