A dispute over a piece of state land in north Scottsdale has two multimillion-dollar car auctions speeding toward a head-on collision. On one hand, the Russo and Steele Collector Automobile Auction claims the much larger Barrett-Jackson Collector Car Auction is trying to gobble up land Russo and Steele has used for several years southeast of Scottsdale Road and Loop 101.

View map of land in dispute

On the other hand, Barrett-Jackson maintains it needs more parking for its West-World at Scottsdale event, and that Russo and Steele had been using state land without permission.

The two auction houses hold their events concurrently each January, with Russo and Steele admittedly capturing high-dollar overflow from the Barrett-Jackson auction.

“It’s a bit of a stretch of the imagination to think that this is benign,” said Russo and Steele founder Drew Alcazar. “The very existence of our event is dependent on our use of that parcel.”

Russo and Steele has received a permit annually from the state Land Department since 2002 to use a nearly 19- acre site on Scottsdale Road for its car auction, which had more than $20 million in sales at its January 2007 event.

But last year, a Scottsdale inquiry into a potential sign code violation by the auction turned up the fact that the site actually contained two parcels, and that the permit only applied to the southern 7-acres, said Mark Winkleman, state land commissioner.

“It appears that Russo and Steele did occupy land they did not have a permit for,” Winkleman said.

The discovery led the state to require Russo and Steele to submit new permit applications for both parcels, Winkleman said.

Alcazar, who served as Barrett-Jackson’s general manager from 1996 too 2000 until differences with Barrett-Jackson owner Craig Jackson prompted his resignation, said the discovery merely brought to light an oversight. Russo and Steele submitted new permit applications on March 22.

“The event has always encompassed both parcels,” he said. “At this juncture we’re working diligently to get this whole unfortunate situation rectified.”

He said he was surprised when he learned that Barrett-Jackson had filed an application for a permit on the northern 12-acre property on May 3. The dueling applications set up a state review process, and Russo and Steele can’t move forward with plans for an auction on the site in January until the review is resolved.

“Right now we don’t have an event site for Russo and Steele,” Alcazar said.

He accused Barrett-Jackson of adversarial, combative, bullying and anti-competitive tactics with the goal of driving him out of Scottsdale.

“They’re still achieving their objective of creating a lot of chaos and discontent in my company because our livelihoods are in jeopardy,” he said.

In a July 4 letter to the City Council, Alcazar asked city officials to lobby in support of his bid for permits to continue operating in Scottsdale. He said the company hasn’t looked at other Valley sites yet.

“Scottsdale is our home. We’ve always been here in Scottsdale,” he said.

City spokesman Pat Dodds said the Russo and Steele auction is good for Scottsdale, but the matter is between the auction house and state land officials. The city doesn’t have any immediate plans to intervene, Dodds said.

Barrett-Jackson spokesman Jason Rose said Russo and Steele has been squatting on land it wasn’t permitted to use.

“Not only do these guys have an inferiority complex, they have their facts wrong,” Rose said. “Listening to criticism from a rinky-dinky ruleviolating thing like Russo and Steele is comical.”

Barrett-Jackson, which holds its $100 million-plus auction at WestWorld, 16601 N. Pima Road, applied for a permit on the property in dispute to park trucks and trailers there.

“Barrett-Jackson’s been looking for a way to get nonrevenue-producing stuff off-site for years,” Rose said.

He said Russo and Steele isn’t entitled to that particular plot of land, and that the smaller auction house owes its existence to Barrett-Jackson.

“Their business plan is to be close to Barrett-Jackson,” he said. “Now, ironically, they’re complaining about Barrett-Jackson being too close to them.”

Winkleman said the two parties have until July 7 to file statements intended to tell the Land Department which has the better case for a permit. If the two cases are found to be equivalent, the state would schedule an auction in early August in which only Russo and Steele and Barrett-Jackson could bid, he said.