City Auctioned Million-Dollar Property on eBay, Notified Only “Interested Parties”

According to a just-released statement that is garnering astonished responses from local business people, the City of East Lansing now says it used eBay to auction-off a million-dollar publicly-owned property.

The City’s statement appears to have been produced in reaction to mounting public pressure to release information about the property sale, a purchase agreement for which Council approved last night in a 4-0 vote with many questions left unanswered.

The contract is with a marijuana industry company and is for part of the old Public Works site at the intersection of Park Lake and Merritt Roads, near Costco. The City says the buyer intends to establish a medical marijuana provisioning center – the legal name for a dispensary.

The new statement seems to confirm that the City did not use any of its normal publicity channels to make potential buyers aware of the auction, which lasted one month, from January 7 to February 6.

Instead, according to the new statement, “Interested parties (approximately 12) were directly notified of the auction.”

We reached out for comment to East Lansing resident and business owner Bill Willbrandt, who told the City just last year that his moving company was interested in buying the site.

Willbrandt responded, “E-bay? Give me a break. We were not notified. I suspect that only marijuana businesses were notified.”

Willbrandt tells ELi the City “conveniently left out of the ‘history’ that we had inquired and were dismissed.”

The City’s statement does not say who was notified, indicating only that a total of “Three parties made 17 bids.”

ELi reported earlier today that City Council Members did not answer questions last night in advance of the vote about why the sale had been conducted with virtually no public notice if the goal was to maximize public profit from the sale.

Council also did not answer questions about why the property was being sold in advance of passage of an ordinance aimed at increasing the property’s value.

The City of East Lansing has been struggling with a financial crisis, with voters recently being urged by this City Council to pass an income tax to help. That income tax took effect January 1 of this year.

The City’s statement justifies the use of eBay by explaining that the site was “selected” because “they do not charge the typical 10 percent of sale price for land auctions, only a nominal $150 listing fee.”

The purchase agreement made with the winning bidder, Kodiak Landarc LLC, specifies that if City Council doesn’t approve the purchaser’s applications for a site plan and special use permit, the purchaser can walk away from the deal.