LOUISVILLE, Ky. (WDRB) – In 2012, Kentucky state government paid $8.3 million to acquire a Prospect estate whose location and debatable significance led transportation officials to spare it as part of the Ohio River Bridges Project.

The purchase price was $1.5 million more than the state’s own appraisal – and $5 million more than the property’s owners had paid in 2000. But rather than let the house sit empty, the Kentucky Transportation Cabinet agreed to let the former owners rent it for $2,700 a month.

But the tenants of the Drumanard estate, the Soterion Corp., failed to make any rent payments since last October and owe the state $13,500, according to documents obtained under the Kentucky Open Records Act.

“They were in arrears on rent, and it wasn’t the first time,” said Chuck Wolfe, a Transportation Cabinet spokesman.

Wolfe said the state ordered Soterion to vacate the property, but he wasn’t sure as of last week whether the move was complete. Federal law does allow moving expenses for relocations related to federal projects, Wolfe said, but he wasn’t aware of how much assistance, if any, was provided.

In addition, he said, the amount owed has climbed to $14,850 since WDRB’s open records request was returned earlier this month.

A Louisville telephone number for Soterion was disconnected last Friday. A message for N. Taylor Jones, a Soterion vice president who signed the rental agreement, left through attorney Bissell Roberts, who represented the company in its deal with the state, wasn’t returned.

Louisville Gas & Electric and Louisville Water Co. officials declined to provide information about whether the property’s utility and water payments were current.

The Drumanard property, located along the Kentucky approach to a bridge between Prospect and Utica, Ind., is one of the most controversial aspects of the bridges project.

Purchased in 2000 and listed on the National Register of Historic Places, Drumanard’s protected status led the federal government to approve a tunnel underneath the estate grounds in 2003. That move was an effort to comply with federal transportation law that requires that “feasible and prudent” alternatives be used to avoid historic properties, if possible.

But in the years that followed – and the cost of the project soared – critics seized on the tunnel and the actions that gave the estate historic status as examples of waste and obstruction.

The house was first placed on the National Register in 1983, and Jefferson County preservation officials moved to broaden the protection in 1988 as part of a review of dozens of properties around the county.

At that time, an official with the Jefferson County Office of Historic Preservation and Archives told the house’s owner that being listed on the National Register could weaken the case for taking all of the property. Discussions were then underway about building an eastern bridge, although it’s route wouldn’t be decided for more than a decade.

In 2010 and 2011, there were multiple efforts to remove Drumanard from the National Register. Those pushing for delisting argued that without the historic status, the tunnel could be scrapped and a cheaper bridge approach built overland. At that time, the tunnel was expected to cost $261 million, part of a larger $547 million approach on the Kentucky side. (Construction of the approach is now estimated at $338 million;
a January financial plan update did not break out the specific tunnel cost

State and federal preservation officials rejected the petitions.

The Kentucky Transportation Cabinet ultimately bought the house and its land. The federal approval for the bridges project required the state to buy the property and add a preservation easement if the owners didn’t add an easement on their own. Soterion didn’t.

Wolfe said the state is in the process of adding a preservation easement before looking for a buyer.

The order to vacate occurred around the time last fall that Soterion made its only rental payment -- $18,900. Although it was obliged to pay rent starting in May 2013, according to the rental agreement, the October 2013 payment was the only one submitted.

Asked why the Transportation Cabinet didn’t evict its tenant after nearly six months of failing to pay rent, Wolfe said: “It is to your advantage to have someone occupy the property. That is a fact.”

Wolfe did not rule out suing Soterion as a way to recoup the money Kentucky is owed.

“It would be reasonable to expect the Cabinet to pursue payment if it hasn’t been made,” he said.

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