At its Dec. 13 meeting, the St. Paul City Council will hear a proposed change to how it can dispose of its unneeded property. It is intended to change existing rules that were established to ensure an open and honest process.

Five years ago, I received an email from the City Planning Department (PED) using its early notification system. It said that they were planning to sell a city-owned 6,200-square-foot downtown plaza, on Robert Street, near Fifth Street. in the center of downtown, to an adjoining owner, Madison Equities. The amount agreed on was only $2,500, or about 40 cents per foot.

This was a great deal for Madison Equities. It looked like a special favor to me. The true value was about $50 per foot.

The City of St. Paul had its own appraisal for $30,000, while Ramsey County had it valued at $326,000. St. Paul’s Planning and Economic Development Dept. explained that the city’s valuation was so low because the plaza was an unbuildable location.

Being buildable isn’t the only thing that creates value, so I offered $30,000, the full appraised value and 12 times more than Madison Equities had been offered by the City. My plan was to both clean up and improve the site and then lease it to an ice cream food truck. I would first, however, give a right-of-first-refusal to Madison Equities, to rent the site for their use however they wished, possibly for patio seating for a new adjoining restaurant. Either way it would be improved and maintained, and I would be paying property taxes that did not otherwise exist.

I found out at the public hearing that Madison Equities was told they had to at least match my offer. So, they then agreed to pay slightly more than $30,000. I wasn’t given the opportunity to raise my offer and the sale was approved for Madison Equities. That looked to me like yet another special favor.

There is now a proposed change to how the City can dispose of unneeded property. It will allow property to be sold without a public bid process, including using sealed bids. While the current changes to the new ordinance will not make it any harder to do the right thing for the City, they will make it even easier to do the wrong thing. The public may not know if there are any special deals on the table. If this had been permitted five years ago, at 375 Robert St. North, I would never have known of the sale for such a low price.

To this day, the parcel has never been sold to Madison Equities or anyone else.  It continues to remain unimproved, and not generating any property taxes. The City could have allowed me or someone else to buy and improve this parcel, rather than have it remain unused and non-contributing. The question needs to be asked, why was it not sold in the first place? Why for such a small price? When Madison Equities didn’t buy the property, why wasn’t it then sold to someone else?

That was not transparent then and would be even less so now if the City Council changes the rules to allow non-public special deals. That would be the wrong decision. There should either be a required bid process or at least later disclosure of the final sale price and an explanation for it.

John Mannillo is a St. Paul real estate developer and current Chair of the civic group Saint Paul STRONG.

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