Auction planned for first Priest Lake cottage sites

BOISE — The state plans to put an undetermined number of Priest Lake cottage sites on the auction block Aug. 28 at the Coeur d’Alene Resort.

At the Idaho Department of Lands, acting public information officer Mary Fritz on Wednesday reconfirmed the date and Coeur d’Alene location for the first-ever open auction of state-owned cottage site properties at Bonner County’s Priest Lake.

In an email, however, Fritz wrote that the number of Priest Lake cottage sites to be put up for sale at the Aug. 28 voluntary auction isn’t yet known.

“We will know the number of cottage sites that IDL intends to auction at Priest Lake around the end of July,” Fritz wrote.

Currently, the 354 cottage site leases on state-owned land at Priest Lake operate under an arrangement in which “tenant improvements,” made by land lessees have included original cabin construction and upgrades.

Now the state of Idaho wants to sell — through a series of auctions — the land the cottages were built on. The structures would also be included in the auction deals — meaning that potential non-lessee winning bidders would be required to compensate current renters for tenant improvements at appraised prices.

Inclusion in the state auctions for cottage site land where lease rates have increased in recent years is done via lessee application — not by state order.

At the Priest Lake State Lessee’s Association, Spokane-based president Denny Christenson said after the April 15 state land commissioners meeting in Boise that the Priest Lake group had earlier recommended to the state that 72 sites per year be made available at auction.

“It (an auction) gives lessees who may be outbid, at least the opportunity to recapture some of the value of those improvements and be out from underneath the lease,” Christenson said. “And they give up their position at the lake. But that’s the way it goes, I guess.”

The state — including the Idaho Land Board — has recently made clear its intention of getting out of the cottage site leasing business. Proceeds from leases of the Priest Lake properties that include vacation homes are allocated to the state endowment fund — mainly to benefit public education.

Two auctions have occurred so far with state-owned cottage sites at Payette Lake at McCall, Idaho. In the most recent auction of Payette Lake properties — April 5 — 20 of 21 lessees held onto their leased properties, buying the parcels through the competitive bidding process. During the first Payette Lake cottage site auction, in October 2013, all 10 leaseholders bid successfully to buy the properties their cabins rest on.

In April, Christenson attended the second Payette Lake property auction at Eagle’s Hilton Garden Inn, and said he was encouraged by the results.

“There was a lot of happy lessees after that was over,” Christenson said.