The state of Virginia paid a member of the General Assembly and a former Prince William County supervisor $500,000 more for a piece of land than the property was initially appraised for because state officials believed the appraisal was low, according to documents on the purchase.
The state bought the 3.8-acre parcel in November 1988 for $896,000 from state Del. David G. Brickley (D-Prince William) and G. Richard Pfitzner, according to state documents. Brickley and Pfitzner had purchased the property from the Veterans of Foreign Wars 15 months earlier for $315,000, according to Fairfax County land records.
Before the state offered to buy the property, it hired a private appraiser to determine the value of the parcel, state officials said. In a June 1988 report to the Virginia Department of Transportation, which was reported yesterday in the Journal Newspapers, the appraiser, Edward B. Atherton, estimated that the land was worth $395,000, according to the documents.
The parcel, which was needed for right of way for the future Fairfax County Parkway, apparently is the focus of a grand jury and FBI investigation of land purchases for the parkway, according to former landowners, attorneys and others interviewed by federal investigators.
In reviewing Atherton's appraisal shortly after it was submitted, a Transportation Department land acquisition official concluded that the appraisal was far too low because it was based on old property sales data and did not take into account more recent transactions in the area, according to the documents.
As a result, the Transportation Department official, J.M. Amos, recommended that the state offer Brickley and Pfitzner "a more realistic" price of $800,000. An attorney for the two landowners persuaded the state to increase the offer by $80,000, and after interest was added, a final sales price of about $896,000 was agreed to, the documents show.
Brickley, a mortgage banker and developer first elected to the General Assembly in November 1975, has said he did not know the parkway would cross the property when his partnership purchased the land. He said he wanted to combine the property with another parcel he owned across the street and eventually rezone all the land for a hotel or office.
Pfitzner has not returned phone calls about the transaction.
Atherton, who lived in Concord, N.C., died recently of a heart attack, according to state officials.
VFW members and others familiar with land values in the area have said that VFW officials simply may not have realized the potential value of the parcel when they sold it to Brickley and Pfitzner.
Members of the VFW said they assumed the value of the land was based on its zoning, which would permit one house per acre. The appraisal, however, was based more on the development potential of the land, which in the county's Comprehensive Land Use Plan is set aside for four to five units per acre, dramatically increasing the parcel's worth.
According to a Atherton's appraisal, county land use officials said the property might even be appropriate for more units than allowed in the Comprehensive Plan because some surrounding town house developments had as many as eight units per acre.
Three other parcels in the same area that had the potential for eight units per acre had sold in 1987 for $100,000 an acre, according to a copy of Atherton's appraisal. Noting that Brickley and Pfitzner had purchased the 3.8-acre parcel for $315,000 in August 1987, and given inflation and other factors, Atherton concluded the land was worth about $395,000, his report said.
However, according to a Sept. 13, 1990, memo by the Transportation Department's reviewer, Amos, another private appraiser also had been working in the same area.
This appraiser, Thomas Reed, had more recent sales data, according to Amos's memo; in fact, Reed found that two of the properties that Atherton had said sold for $100,000 an acre had been combined a month later and resold for double that amount.
"The big difference was that Mr. Reed possessed knowledge of the market Mr. Atherton . . . didn't have," the memo states in explaining why the higher price was paid to Brickley and Pfitzner. "Mr. Reed recognized the market was accelerating and applied sales in his appraisal to back this up."