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City approves $1 lease with former land owner

A lease between the city of Covington and the former owner of a property on Williams Road was unanimously approved at the Covington City Council meeting on Wednesday, despite the questions raised about the agreement between the city and the former owner.

The city bought the property in 2008 for future expansion of the nearby airport. According to former owner Stephen Ratchford, he sold the 53-acre property at an amount well below the appraised property value. In return, he would lease the property back from the city for $1.

Thirteen years ago, Ratchford began leasing the property to Damascus Road Recovery (DRR), a long-term substance abuse and recovery residence, for $1,000. Prior to the lease with DRR, he was earning $2,500 a month in rental.

In a letter to the city dated Nov. 25, 2015, Ratchford told the council DRR had treated 400 men. Of those, 25 percent of the men who entered the program graduated and 65 percent of those are still sober. “This is three times the national success rate.”

Mayor Ronnie Johnston, while expressing appreciation for the program, saying it successfully served the men of the community, questioned the arrangement.

Though he said he did not remember what he sold the 53-acres to the city for, Ratchford said he sold it for less than its appraised value with the condition that he be able to rent it back for $1 until the city decided to develop it for the airport.

When asked, City Attorney Ed Crudup told the mayor and council that he was the city attorney at the time and had no knowledge of the agreement. He had, however, written the lease, which the city had with Ratchford for eight years.

“I think you need to have a paper trail,” said Post 1 West Council Member Kenneth Morgan. “From a liability standpoint, we have to have something in writing.”

The mayor asked if it would be possible to move away from leasing the property to Ratchford, and lease it directly to DRR.

“We’re not getting taxes from the property,” Johnston said. “It’s off the rolls. But I want to make sure we’re being fair, we’re being protected and the land is being kept nice.

“I want you to continue what you’re doing, and doing well,” Johnston told Scruggs. During the meeting, later, he invited Scruggs to tell the council about DRR.

Scruggs said, “Over the last 13 years, we’ve had 400 men come down our drive.”

An alternative facility

Combining spiritual care, individual and group counseling, relapse prevention, 12-step meetings, regimented schedules of work and recreation and family help, DRR is certified as an alternative to prison for men convicted of substance abuse. The minimum stay at DRR is two years, and there is zero tolerance for substance use enforced through regular drug testing.

“The population I deal with is very unstable,” he said. “I would like, for my own peace of mind, to be able to stay in place as long as we can.

“My belief is that every man has the right to how to live before they go to prison,” he said.

A recovering addict himself, Scruggs said, “I’ve kept a lot of men out of Jackson [a state prison].”

Post 1 East Council Member Chris Smith told the council that he had toured the property. “I was very impressed. The property was immaculate.”

Post 2 West Council Member Hawnethia Williams, a former teacher, said was amazed by the program at DRR. “Each man had an individual schedule. They treated [the facility] like it was home because it is their home.”

She reported she’d heard testimony about how a man’s hopelessness was interrupted by DRR.

Johnston agreed the program was important. “Obviously, what you all are doing that God put His hand on you. What you’re doing works. I’m going to assure you we’re going to do all we can do to support you. The work you’re doing is incredible and I’m proud you’re in Covington.”

Smith suggested renewing the contract for a year to give the city time to research the history of the property and lease and to “get the numbers in place. City Manager Leigh Anne Knight said they could have something ready for the next meeting.

In 2017, Smith said, the council could make a decision about whether or not it was fair to continue to sub-lease.

In an email following the meeting, Johnston said that Knight and he were in the process of gathering information on the history of the agreement between the city and Ratchford.

“I’m not sure why the City of Covington agreed to this transaction in 2008 and to be honest there may be a justified reason at that time,” he wrote.” However now I do not see any justification to continue this in its current form.

“In summary, the problem I have is the City of Covington seems to be allowing an individual to sell his land to the city, which takes the property off the tax digest and then lease said property back from the city for $1 and then lease it to another entity for profit.

“To be clear,” he continued, “I totally support the Damascus Road Recovery program and believe this program provides a great service to our community. The solution is simple end the lease with Mr. Ratchford and establish a new lease directly with Damascus Road Recovery with the current land owner, City of Covington for a profit.”

In other business, the council:


  • approved a resolution setting the charges for commercial use of electricity during summer and winter peak, super peak and off-peak periods.
  • approved the appointment of Liz Pope to the city’s Health Board for a four-year term. The Health Board is expected to meet on Jan. 28, in advance of when the council will appoint members to boards.
  • approved the purchase of two SUVs for police department canine units from Ginn Ford at a total cost of $102,176.74.
  • approved a invoice for $26,039.92 to Dial’s Diesel Parts and Services, Inc., for emergency repairs to a sanitation truck. The repairs included replacing the vehicle’s engine.