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By DAMON LAWRENCE
Were his dreams crushed by disaster or were those dreams bigger than his wallet?
Joseph Armes II insists the TVA ash spill, not investing beyond his means, is the reason he’s on the verge of financial ruin.
Armes is the owner of an extravagant lakefront home tucked away on secluded acreage north of Kingston. The home was supposed to be the centerpiece of an affluent lakefront community Armes was going to develop in Roane County.
“I put every penny that I had saved, and everything that I had earned into this project,” Armes said. “This was going to be the project that took me to another level financially. Now this investment has almost single-handedly destroyed me.”
The home isn’t finished. It has only a dirt road leading to it, and the yard is a mess, but it still has an appraised value of nearly $1.2 million, according to the state’s real estate assessment data Web site.
Armes said he had the home appraised by a private company, who gave it a much higher value than what the state shows.
Armes said his plan was to complete the home, sell it and then build another pricey place on the lakefront property. He was going to repeat that pattern until the land was fully developed.
“This was my lifelong dream to buy this property and develop this land,” Armes said.
Ash spill factor
To complete the first home, he needed to borrow some more money. He said that’s where the ash spill comes into play.
Armes’ budding development consists of a 40-acre parcel that includes lake frontage. He said he recently attempted to borrow money using the house and the land as collateral and was denied by two different banks.
“Both banks refused to loan me the funds because they thought the ash spill devalued my property too much,” Armes said.
Many developers have fallen on hard times because of the downturn in the economy.
Armes said he thought his investment was such a good one that it would be immune to any economic downturn.
“My thoughts were, when I built it, that I could always sell it, even with a down economy and the housing market being down,” he said. “Had this ash spill not hit, you could have still sold property even if you had to take a lesser price for it, but nobody even wants to look at it now.”
Stuck with what he says is a $14,000-a-month interest-only mortgage payment and his chances of securing financing to finish the home looking bleak, Armes was so desperate that he sent out an SOS to federal, state and local politicians.
“I can’t borrow money,” Armes said. “I can’t do anything with it. It’s just at a standstill. Financially I can’t keep going on and making payments on this thing when I can’t even finish it.”
TVA spokeswoman Barbara Martocci said the agency is aware of Armes’ situation.
“We recently received a claim from Mr. Armes and, at his request, are now working through his attorney on that claim,” she wrote in an e-mail.
Armes said he has had an attorney reach out to TVA, but said the agency has been non-responsive.
“I want to negotiate something out, but I’ve not heard anything from them,” Armes said. “As far as I’m concerned, they’ve not even gotten back with me.”
The smoke stacks at TVA’s Kingston Fossil Plant are visible in the distance from the lakefront home.
A dike failure at the plant on Dec. 22, 2008, released 5.4 million cubic yards of impounded fly ash into the environment.
The Emory River was glutted with ash as a result of the disaster. Armes recalled the hoopla he witnessed in the aftermath.
“The news, the media, helicopters flying over; it was crazy for the first month after the spill,” he said. “I’d come down here and there were people constantly in the water testing stuff.”
Armes said the lakefront home has five bedrooms, six bathrooms and has more than 6,000-square-feet of living space.
It has an abundance of windows and amenities such as granite countertops, elaborate molding, custom-tile work, a huge kitchen and immaculate wood and marble flooring.
An unfinished movie theater room is on the second floor.
“I think it has potential to be a beautiful home once it’s finished,” Roane County Property Assessor Teresa Kirkham said.
Armes said knowing the home’s potential makes it more difficult to cope with his situation.
“I’m very proud of this place,” he said. “It hurts that much more to be so proud of something and be on the edge of losing it.”
Armes said he had wanted to purchase the land that the home sits on since he was in high school.
He bought it from the Dickey family in 2006 for $850,000.
“I felt like there was potential to put 25 homes in here, and those were my intentions,” Armes said.
A lot of investments don’t look as good as they once did in today’s ailing economy.
County records show that Armes has had trouble taking care of the tax obligations on his property.
His 2008 and 2009 property taxes have not been paid, although the 2009 taxes will not be considered past due until March 1, 2010.
The 2008 taxes are seriously past due and Armes is drawing a penalty for every month they go unpaid.
To date, he owes Roane County more than $13,000 in unpaid taxes.
“I’m not spending money that at the time I don’t have on something that I can’t get anything out of, to be honest with you,” he said.
Armes could be turned over to the county’s back-tax attorney if he doesn’t pay his property taxes.
That seems to be the least of his worries at this point.
Armes said his budding development has left him with a $2-million debt.