by Scott

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October 9, 2012
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Auction shines light on blighted station

A blighted gas station with a history of environmental problems is at the center of a strange public auction that has local government officials and private investors stalking the ghost of a bargain.The question of who owns the Eagle Gas Station at the S-curve of Highway 395 and Mission Street in Gardnerville had been as mysterious as the store's on-again-off-again operation... until the arrival of a man named Mohammad Ahmad. In an Oct. 4 phone interview, the Carson City resident said that his company, V-R Property Management, also owns Eagle Gas and Gas & Save in Carson City, and it still owns the Gardnerville station pending the outcome of a foreclosure sale. He said he purchased the latter property in 2006 but wasn't informed of any environmental issues at the time. Ahmad told The Record-Courier he tried to sell the station in 2009 after it shut down, but he was unsuccessful. “I tried to negotiate with the bank, but they wouldn't negotiate,” he said. Foreclosure proceedings followed. An Oct. 3 auction outside the Douglas County Judicial Building was postponed until Nov. 7 due to a lack of bids. The minimum bid was $100,000 for the .39-acre commercial site, which includes a 1,218-square-foot corner store, a 1,300-square-foot steel canopy, and three fuel dispensers with six fueling stations.Ahmad said a new operator, a man named Ajay Shama, reopened the site in February and is still running the convenient store and gas pumps. Ahmad wasn't sure if Shama would try to buy the property at auction. Whoever purchases the property assumes liability of the site's underground gas tanks. Ahmad said that he recently learned of prior contamination. He said two soil samples taken in 2004 showed 4-6 feet of contamination around the tanks. He wasn't sure if the problem was mitigated at the time or if ground water was contaminated.“There is contamination,” he said. “We are afraid to do anything. It's an old station. There's always something in the ground no matter what you do. Someone has to be responsible for that.”On Sept. 17, the Nevada Department of Environmental Protection sent a second notice of violation to Ahmad and Shama.“On April 17, 2012, NDEP conducted a site visit at the facility referenced above,” the notice read. “To date, the requested documentation has not been received.”Current violations center around a general lack of test records — for tank leak detection, line leak detection and line tightness. There's also no documentation of financial responsibility for damages in the event of a spill. Ahmad said the operator is in the process of submitting required documentation to NDEP before an Oct. 17 deadline. He said the violation notice does not pertain to any deeper soil contamination — only to standard testing and a lack thereof.“Well, you can still sell the gas,” he said. “They give you some time to provide the testing.”If no one buys the property in “as is” condition, Ahmad said that he'll remain financially responsible for the site.“How many owners have been there? I don't know. It's an old store,” he said. “You're definitely going to find contamination no matter what you do. If somebody wants to buy it, they'll have to drill and get water samples.”The question, then, is who would buy a gas station with potential liabilities?At the Oct. 3 auction, some men showed up late to the spectacle and were informed of its postponement to Nov. 7, 10:30 a.m., in the same location. The minimum bid of $100,000 might or might not be lowered in the future, at the creditor's discretion.Gardnerville Town Manager Tom Dallaire was also among the crowd at the auction. The night before, town board members had instructed him not to bid on the property, which had been identified in the town's strategic parking plan. According to those plans, not only could a public parking lot at the S-curve connect to more town-owned parcels to the west, totaling 103 parking spaces, but it could serve as a formal entrance to the town.Dallaire had recommended the town make a maximum bid of $175,000. Demolition for the parking lot, he estimated, would total $156,272. Looking at combined costs, however, town board members decided to pass. Douglas County Clerk-Treasurer Ted Thran, who attended the town board meeting, said he was ordering a title report because the station owner owed the county more than $25,000 in back taxes, not to mention $408 owed to Gardnerville for trash service. Thran said if the property were to go to a tax sale, the county could transfer the property to the town under the provision of “beneficial use.”But Douglas County Assessor Doug Sonnemann, who also attended the first auction, said it's unlikely a tax sale would occur, considering the debtor owes more than $575,000 on the property. In other words, the creditor could lower the minimum bid and still salvage more from the property than in a tax sale. In the meantime, Dallaire is looking into the Nevada Brownfields Program — a federally funded program administered by NDEP that offers environmental assessment and loans for clean-up. If the town were to pursue purchase, Douglas County Planning Manager Candace Stowell suggested applying for a community development block grant to help fund renovation. That process, though, may be lengthy.“It may be a wonderful opportunity for the town to get on-street parking,” she said. “We do want to change county code in the future, making it less easy for property owners to let happen what happened here... It's very unfortunate.”

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The Record Courier Updated Oct 10, 2012 01:59PM Published Oct 9, 2012 05:37PM Copyright 2012 The Record Courier. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.