Developers sue over state’s move to revoke sale

The developers who had been selected to purchase the vacant Idaho Transportation Department campus sued the state over the Legislature’s move to unwind the sale through the agency’s budget bill.

Attorneys on behalf of Hawkins Companies, the Pacific Companies and FJ Management filed a lawsuit with the State Supreme Court on Thursday arguing that the contentious ITD budget bill and the Department of Administration budgets were unconstitutional because of intent language included that tanked a planned sale of the old ITD headquarters.

The lawsuit argues the bills violate the state constitutional requirement that legislation address only a single subject.

The court documents allege that certain lawmakers sought to kill the sale through the budget bills, which are not supposed to include policy changes. It argues that the agency correctly adhered to the process outlined in Idaho’s laws for selling surplus property.

“Of course, the Idaho Legislature is in the position of authorizing all appropriations and controls agency spending. … This does not, however, mean that the Idaho Legislature may use an appropriations bill to perform a ‘shadow’ amendment of general law,” Clark Wardle LLP partner, and Attorney T. Hethe Clark wrote in the court filing. “Instead, all appropriations bills must be consistent with — and cannot amend — general law.”

The ITD and administration budgets were the subject of much debate and contention in the final days of the 2024 legislative session, with several lawmakers disagreeing over whether it was appropriate to change course on the planned sale using a budget bill.

House Speaker Mike Moyle had been vocal about his opposition to the sale of the 44-acre campus. Senate President Pro Tem Chuck Winder, who is a former transportation board member, had supported the agency’s decision to surplus the property and strongly opposed the effort to disrupt the process.

Those who supported it said that the intent language was meant to ensure the state was better utilizing its funds and assets.

The first version of the $592 million ITD budget passed the House by a single vote and then died in the Senate; all of the opposition was to the included “intent language,” which said, “the authority of the Department of Administration dispose of the state administrative facility and property at 3311 W State Street, Boise, Idaho 83703 is revoked.”

The budget also included $32.5 million to renovate the vacant headquarters.

The budget-writing Joint Finance and Appropriations Committee later returned a nearly identical budget, with just a $100 reduction. Winder challenged this legislation over a parliamentary objection that is was too similar to the rejected bill. JFAC approved a third version of the budget, with a $200 reduction from the original budget; the Senate narrowly approved this version.

The State Street campus had been vacant for two years after it flooded in 2022. The agency had been working out of temporary offices and had plans to move into the state’s Chinden Campus.

Under current Idaho code, once agencies declare that property has no further use to the state, they may declare them surplus, and the Department of Administration is tasked with selling the surplussed property.

Gov. Brad Little allowed the bills to go into effect without his signature, citing concerns over the intent language.

“I did not sign these bills because the intent language unwinds statutory policy language about how the state handles surplus properties and it increases overhead for office space needs across the state,” Little wrote in his transmittal letter. “In addition, it unfairly cancels an agreed upon sales process, causing future reputational risk for the state of Idaho.”

The developers are asking the Idaho Supreme Court to declare the provisions in the budgets unconstitutional, and either deem just those sections invalid or the entire budgets. The lawsuit also asks the court to require the Department of Administration to go through with the planned sale.

“While disappointed we must turn to the courts to enforce fair business practices in the state, we believe it is necessary to challenge the Legislature’s heavy-handed and plainly unconstitutional interference into a competitively bid land sale,” Hawkins Companies CEO Brian Huffaker said in an emailed statement.

“We are confident the outcome of this litigation will be a win for small government and free-market advocates across Idaho.”

Guido covers Idaho politics for the Lewiston Tribune, Moscow-Pullman Daily News and Idaho Press of Nampa. She may be contacted at lguido@idahopress.com and can be found on X @EyeOnBoiseGuido.