PRESS RELEASE: West Virginia Highlands Conservancy

Contact: Vivian Stockman 304-927-3265

CHARLESTON-- In a recent West Virginia Public Radio report Congressman Mollohan expressed strong support for federal protection of the Blackwater Canyon.

"We are thrilled that Congressman Mollohan has announced his support for federal protection of the Blackwater Canyon," said Vivian Stockman, spokeswoman for the WV Highlands Conservancy Blackwater Canyon Committee. "His words put us all one step closer to a national park."

"The Congressman is acting in the interests of his constituents," Stockman added, noting that over 18,000 thousand people have signed petitions and hundreds have written letters asking for protection of the Blackwater Canyon.

The Highlands Conservancy and a coalition of grassroots environmental, church, labor and social groups are calling for the establishment of the Blackwater Canyon National Park. Allegheny Wood Products is logging in the canyon and has applied for wastewater treatment permits for condominium developments on the canyon rim and along the Blackwater River.

"Congressman Mollohan’s statement reflects clear foresight in understanding the importance of public lands to West Virginia’s economy and environment," Stockman said. "He also has a notable track record in working for the protection of other special landscapes in the state. For instance, he helped create the Canaan Valley National Wildlife Refuge.

"We are very pleased that Mollohan has indicated a willingness to work in this area of the public interest to find the funding necessary for federal protection of the Blackwater Canyon."

Stockman explained that, given its scenic and economic values and its irreplaceable endangered species habitat, the Highlands Conservancy believes that protection of the Blackwater Canyon is undoubtedly in the public interest.

The United Methodist Church of West Virginia recently passed a resolution calling for "open dialogue and principled negotiation" on efforts to preserve the Canyon. State park director Cordie Hudkins has also publicly stated that development in the canyon could potentially devastate the Blackwater Falls State Park.

"We are so glad both the United Methodists and the director of the state parks recognize the importance of preserving the Blackwater Canyon," Stockman said. "The government should move now to create Blackwater Canyon National Park for all West Virginians."

About 55 acres of the scenic Blackwater Canyon will be turned over to the state under an agreement announced Wednesday by Gov. Cecil Underwood. Allegheny Wood Products will give the state 50 acres near the popular Lindy Point overlook and along the Canaan Loop Road just west of Blackwater Falls State Park, the governor said. The Petersburg-based company will sell another 5 acres – including the actual Lindy Point site and land immediately surrounding it -- for $250,000, Underwood said.

The deal, signed by Underwood and Allegheny Wood President John Crites, will earn the company 30 times the per-acre price Allegheny Wood paid for the property two years ago. Crites also gave the state the right to -- within 5 years -- match any offer to buy another 130 acres northeast of Lindy Point and north of Canaan Loop Road. Underwood spokesman Dan Page said money for the purchase would come from either the state Division of Natural Resources or the governor’s contingency account. The land would become part of the state park, Page said.

"This agreement with Mr. and Mrs. Crites and Allegheny Wood Products will result in a significant addition to our state park system," the governor said in a news release.

"Lindy Point holds great value for the people of West Virginia, and I am pleased that we have been able to establish an agreement that respects private property ownership rights and, at the same time, preserves a natural icon in the Blackwater area for future generations."

Crites said, "We are pleased to be able to preserve this special area for future generations, and you can be assured that Allegheny Wood Products will continue to manage the forests of West Virginia in a responsible manner."

The 55 acres turned over under the deal represents less than 2 percent of the land Crites owns in the canyon. It will increase the size of the 1,688-acre state park by 3 percent. Crites paid $5 million for his 3,000 acres, or about $1,700 per acre. Under the deal Underwood signed, the state will pay Crites $50,000 per acre for the 5-acre Lindy Point.

Allegheny Wood Products has submitted permit applications to build a 600-acre resort on its canyon property. The company says it wants the permits so it can obtain accurate appraisals of the property’s worth. Earlier this year, Crites pulled out of a proposed plan to trade part of the canyon to the federal government because he said the two sides were "millions of dollars" apart on their appraisals.

Judy Rodd, spokeswoman for the West Virginia Highlands Conservancy, said her group will continue to campaign for all of the canyon to be made into a national park.

"It's a good first step," Rodd said of the governor’s deal. "I think that it shows Mr. Crites is a willing seller. "It also shows that public pressure can change people's minds," Rodd said. "We wouldn't want the best viewing spot in the canyon to look down on condos and timbering, so we’re going to continue working hard on obtaining the entire canyon." _

Blackwater Falls in Tucker County is one of the best known recreational areas in West Virginia. The stunning views in that region

appeal to West Virginians and out-of-state tourists alike. A recent agreement with the owners of Allegheny Wood Products Inc. of Petersburg will

expand Blackwater Falls State Park to include Lindy Point, an outcropping above the Blackwater Canyon that many consider to be the crown jewel of the West Virginia landscape. The agreement will result in a significant and lasting addition to our state park system.

John W. and Patricia A. Crites, who own Allegheny Wood Products Inc., joined me on June 17 at the Capitol to sign a Memorandum of Understanding that spells out the details of the transaction. They have agreed to sell the

state a 5.02-acre tract that includes Lindy Point for $250,000 and to donate an additional 50 adjoining and nearby acres to the state. The agreement will permit our park personnel to improve access to Lindy Point so more people will be able to enjoy its grandeur.

In addition, Mr. and Mrs. Crites agreed to give the state the "first right of refusal" for five years on an additional 130 acres northeast of

Lindy Point and north of Canaan Loop Road. That means the state will have an opportunity to acquire the additional land should Allegheny Wood Products receive and accept an offer for the property during those five years. The 130 acres will not be timbered for at least five years.

First and foremost, I am grateful to Mr. and Mrs. Crites for their generosity. As owners of Allegheny Wood Products, they are responsible for the operation of a business that supports about 500 families. I also recognize the care with which Allegheny Wood Products manages its properties. As stewards of a great West Virginia natural resource -- our forests -- Mr. and Mrs. Crites are recognized for responsible and professional practices that protect the future value of the forests of West Virginia.

In addition, I want to reinforce my support for the private ownership of property and recognize its importance as part of our economic system and our social fabric. Many West Virginians own and protect the mountains and

valleys of our beautiful state, and they depend on that property to earn their livings and support our economy. They are among our very finest citizens, and I respect the enormous contributions they make to our state and people.

Lindy Point holds great value for the people of West Virginia, and I am pleased we have been able to establish an agreement that respects private property ownership and, at the same time, preserves for future generations a natural icon in the Blackwater area. Without question, this gift demonstrates that John and Patricia Crites fully appreciate the unique quality of the Blackwater area, as well as the attachment the people of West Virginia have to the area.

I have stressed over the years that we can resolve complex issues if we are able to identify common ground upon which to build. That is how we approached the negotiations with Mr. and Mrs. Crites and Allegheny Wood Products. I am pleased to say that by working together we have been able to strengthen our state park system for generations to come.

(pardon redundancy)

For Immediate Release Contact: Dan Page

June 16, 1999 (304)558-6343

CHARLESTON, W.Va. -- Gov. Cecil H. Underwood today joined John W. and Patricia A. Crites of Allegheny Wood Products Inc. to announce that the Grant County company has agreed to sell to the state a five-acre parcel of land at Lindy Point in the Blackwater Falls area of Tucker County and to donate an additional 50 acres.

The governor and Mr. and Mrs. Crites signed a Memorandum of Understanding that outlines an agreement that will expand Blackwater Falls State Park and reaffirms Allegheny Wood Products’ use of best forest management practices on the land it owns in Tucker County.

"This agreement with Mr. and Mrs. Crites and Allegheny Wood Products will result in a significant addition to our state park system," Gov. Underwood said. "Lindy Point holds great value for the people of West Virginia, and I am pleased that we have been able to establish an agreement that respects private property ownership rights and, at the same time, preserves a natural icon in the Blackwater area for future generations."

The agreement calls for the state to pay Allegheny Wood Products $250,000 for five acres, which include Lindy Point. The company will donate to the state about 50 nearby acres, which include an access road from the state park to Lindy Point.

As part of the agreement, Mr. and Mrs. Crites also have agreed to give the state the "first right of refusal" for five years on an additional 130 acres northeast of Lindy Point and north of Canaan Loop Road. The arrangement will provide the state an opportunity to acquire the additional land should Allegheny Wood Products receive and accept an offer for the property during those five years.

The Memorandum of Understanding also states the 130 acres will not be timbered for at least five years and also will restrict Allegheny Wood Products’ right of easement across parkland. The existing deed has no restrictions regarding easement.

"This gift demonstrates that John and Patricia Crites fully appreciate the unique value of the Blackwater area," the governor said. "They have an excellent reputation for their business practices, and this agreement demonstrates their commitment to the responsible management of the resources of our state."

Joined by his wife, the Allegheny Wood Products president expressed his appreciation for Gov. Underwood's willingness to listen and negotiate an arrangement that will benefit the people of West Virginia.

"We are pleased to be able to preserve this special area for future generations, and you can be assured that Allegheny Wood Products will continue to manage the forests of West Virginia in a responsible manner," Crites said. "Through this arrangement, we will preserve this area for our employees, our neighbors and future generations of West Virginia residents."

Allegheny Wood Products, which employs about 500 people, is recognized widely for its modern forest management practices.

From The Charleston Gazette on 6-25-99

By Ed Maguire,

Gov. Underwood’s announcement of the state’s purchase of five acres in the Blackwater Canyon for a quarter-million dollars is being hailed by some environmentalists as a first step toward eventually turning the entire 3,000 acres into a national park. Perhaps that’s true. But for some of us who work professionally on acquiring large tracts of undeveloped properties for conservation buyers, there is a concern that the announced purchase may turn out to be a first step in precisely the opposite direction.

It has been well publicized that the Blackwater Canyon’s owner has endeavored to develop appraisals for his property that reflect a value significantly higher than the price paid for the land. The owner has been totally up front about those efforts, claiming that his motivation is to justify a higher price were the property to ever be sold to a government agency.

By structuring a sale of the five-acre Lindy Point parcel separate from his donation of an adjoining 50 acres, the owner has substantially enhanced his appraisal process by establishing a highly inflated comparable sale.

This might seem like negative speculation on my part. But within hours of the announced sale and donation to the state, the owner’s spokeswoman was on statewide public radio boasting about this very point. This makes one wonder about the true motivation behind the transaction.

Perhaps more troubling is the question as to why the governor’s office agreed to the deal as structured? Why did they agree to two separate transactions, one involving the donation of 50 acres and the other the sale of five acres at such an inflated per-acre price? The governor’s office could have instead insisted that the two properties be sold together to the state via what is termed a "bargain sale." Under that scenario, the canyon owner would have received the same amount of cash. Presumably he has appraisals showing that the value of the combined parcels is in excess of the sale price of $250,000. If so, he would be entitled to a tax deduction for the difference between the bargain sale; price as paid by the state and whatever higher value is reflected in his appraisal. Thus he would have still received a tax write-off for the gift portion of the transaction.

The difference with the bargain sale versus the sale-plus-donation scenario is that the amount of the resulting charitable contribution would be determined strictly between the canyon owner and the Internal Revenue Service.

But with the sale and accompanying donation announced by the governor, the state has provided the canyon owner with a comparable sale at a value of $50,000 per acre. Thus the state has become a party in establishing values -- and perhaps the future selling price -- for the balance of canyon property. Was the governor’s office a willing ally? Was it focusing exclusively on some sort of short-term piecemeal victory for political purposes? Or was it just dumb?

The appraised value for the balance of the Blackwater Canyon has likely just gone through the roof. If it wasn't priceless before, it may now very well be.

A surprising number of West Virginia’s other crown jewels are privately owned. I know firsthand of owners of some of those places who have been closely following the controversy involving Blackwater Canyon. My guess is that they likely viewed the governor’s Lindy Point announcement with a lot more enthusiasm than I did.

Recently, Gov. Underwood announced the acquisition and donation of 55 acres of land around Lindy Point near Blackwater Falls State Park, a parcel of land commonly referred to as a "natural icon" and the "crown jewel" of West Virginia.

The Gazette characterized the $250,000 purchase price of Lindy Point as high, based on a misleading comparison of the original purchase price per acre for the canyon. The Gazette complained that the $50,000 price per acre was 30 times the original price per acre for the entire canyon. Such a comparison is unfair and unrealistic. All the acreage in the canyon is not worth the same amount. One cannot compare the value of Lindy Point, which the Gazette describes as one of West Virginia’s scenic locations, with other acreage of the canyon, which is on the side of a mountain and virtually inaccessible.

Such as comparison would be tantamount to saying all the property in the Kanawha Valley is worth the same amount. We know this isn’t true. The value of property in this valley deviates significantly. If one reads the classified ads or the property transfer sections of the newspaper, it is apparent that lots in subdivisions such as Foxchase and Quarry Creek sell for 30 times the cost of land in less-desirable locations.

Likewise, the value of property in the canyon deviates significantly. The old real estate maxim holds true: location, location, location! Lindy Point is arguably the best piece of property in Blackwater Canyon. While many West Virginians may not have ever heard of Lindy Point, they have certainly seen it in tourism promotions and television advertising. It is one of the most widely photographed locations and, as such, is worth a lot of money. I have no doubt that the owner, John Crites, could have found a developer more than willing to pay $50,000 per acre for this relatively flat land with breathtaking views. In Charleston, lots in certain subdivisions sell for more than $150,000, and the view is not nearly as beautiful as the view from Lindy Point.

If Gov. Underwood had turned down the opportunity to acquire for the state 55 acres around Lindy Point, including an access road, logging restrictions, a first right of refusal on another 130 acres of the canyon, and other benefits for the park, the public outcry would be enormous.

He did the right thing in preserving this beautiful piece of land for future generations, and I look forward to taking my family to this beautiful spot. We are fortunate to have generous neighbors like John and Pat Crites who would sell this incredible piece of land and donate to the state so much more.