V Hugh Lewis II/Jefferson Jimplecute
JEDCOs acquisition of 16 acres on US59N hit a few roadblocks Tuesday evening as members debated the needs of a new survey, mineral rights research, and an agenda wording issue preventing the board from approving the contract.
JEDCO attorney Pinky Palmer converted last month’s Letter of Intent, which was signed by the seller prior to JEDCO approval to present the letter, to a Contract for Sale.
The contract had a $177,500 sales price instead of the proposed $285,000, due to a change in ownership of the mineral rights on the property. The lower sales price, nor a contingent on price increase due to mineral rights was never discussed in open session.
Board President Charles “Bubba” Haggard told the board that originally, he understood the sellers’ owned all the mineral rights on the property, but it turns out that there are at least two other parties which own part of the rights.
The acquisition would give JEDCO a 25% interest in the mineral rights on the property.
“We’ll have to get somebody because we’re paying $2,500 for the four acres [of mineral rights],” Haggard said. “We need to have somebody to make sure that’s what we’re getting.”
Board member Lynn Daughrity questioned the need to spend an additional $500 for the research when the sale contract specified the mineral right interest being sold.
“I don’t know why we’re considering paying extra money,” Daughrity said, “I don’t know why we’re worried about the mineral interest. They either own the mineral interest or the don’t. They represented they have a quarter interest and if we later discover they don’t have a quarter interest, they’ve violated the contract to us. I don’t know why we have to do additional research on that. They’re confirming it to us by contract.”
Palmer explained that the Title Insurance policy does not cover mineral interests and that if an issue came about in the future, JEDCO would need to send a demand letter requesting the funds be returned, and then if they weren’t, consider litigation.
Haggard, when asked, said he was thinking of getting James Parsons to do the research
Ultimately the minerals research action died for lack of a motion. No action was taken on the matter.
The property was last surveyed in 2019 but a topographical survey was not done at the time.
“The property, at this stage of where it is, we understand there’s some possibility it can flood, and without a topo we have no knowledge of what we’ve got,” said JEDCO VP/Secretary Raymond Sanders. “I think we need a couple bids.”
Haggard said he had a couple calls out, but until he got three bids, he did not know how much a topographical survey would cost.
The board approved getting a boundary and topographical survey from three different contractors.
The contract of sale could not be approved during the meeting as it was listed on the agenda as a discussion/update and not an action item.
JEDCO will meet again on May 9.