The Bernero administration has rejected developer Joel Ferguson’s $2.9 million offer to buy the North Capitol Avenue parking ramp in favor of Lansing Community College’s bid, even though it is $100,000 less.
Jerry Ambrose, the city’s finance director and Mayor Virg Bernero’s chief of staff, sent Ferguson a letter on Jan. 6 rejecting the offer.
“Prior to receiving your communication, the decision had been made by Mayor Bernero that accepting the offer to purchase made by Lansing Community College would be in the best interests of the city,” Ambrose wrote.
On Nov. 18, Ferguson offered the city $2.8 million for the ramp, plus an offer to lease city office space in the ramp to the city for $6 per square foot.
Ferguson’s November offer was the latest for the ramp after a failed vote in City Council in May to sell the ramp to LCC for $2.7 million, and for the city office lease to be $12 per square foot.
Ferguson described in a letter to City Council that after Nov. 18 he entered into talks with the administration to revise his offer so that it would include a requirement that LCC be able to buy or lease the ramp within two years of Ferguson’s purchase. Until Ferguson expressed interest in the ramp after the May vote, LCC had been the only entity the city was in talks with to buy the ramp. The college’s parking shortage, combined with the city’s desire to rid itself of an aging parking structure, brought the two sides together.
On Dec. 14, LCC President Brent Knight wrote a letter to Bernero that stated, “Lansing Community College is not, at this time, making an offer to purchase the North Capitol Avenue parking ramp.”
However, on Dec. 22, the LCC Board of Trustees held a special meeting at which, after a closed session, it voted to allow Knight to make an offer on the ramp. On Jan. 4, LCC offered the city $2.8 million for the ramp and $6 per square foot for the city office lease.
On Jan. 5, Ferguson submitted another offer to the city, this time upping the purchase price to $2.9 million.
“I don’t see the problem,” Ferguson said about his offers.
Ferguson took his case to the Lansing City Council last Thursday, handing out a packet of information at the Committee of the Whole meeting that detailed his bid.
But the Council may never have an opportunity to vote on the offer. In order for a piece of city property to be sold, a buy/sell agreement has to be “placed on file” with the city clerk for public inspection for 30 days. After that, City Council can hold a public hearing on the issue, and then vote whether to accept the agreement.
A problem for Ferguson is that the mayor’s administration picks what is placed on file with the clerk and what is not, said City Attorney Brigham Smith. Smith said the Council could discuss the matter at a committee meeting, but it could not bring it up for an official vote.
When asked why LCC would submit an offer to buy the ramp after writing a letter to Bernero to the contrary, Knight said that the letter contained an important clause: “at this time.”
“We were exploring (leasing or buying the ramp from Ferguson) for several weeks,” Knight said. “The letter was indicative of that.”
“Our board simply said to me, ‘Let’s make one more attempt,’ which I think was a good recommendation: ‘Why don’t we try one more time?’’’ he continued.
Knight said that he and Bernero had an “ongoing dialogue” about the sale of the ramp, but that the mayor did not influence the board to vote to make another offer on the ramp. Both Ferguson and Knight, however, confirm that they had several meetings regarding the ramp.
Neither Bernero nor LCC Board Chairwoman Deb Canja returned calls seeking comment.
At-Large City Councilman Brian Jeffries says that the newest developments feel like the Abbot and Costello routine, “Who’s on first?” After a failed October 2008 vote to sell the ramp, Jeffries had tried to broker a deal with LCC that would have raised the sale price to $2.8 million, which Bernero rejected.
“The rental rate and purchase price is the same things we worked out in December 2008,” said Jeffries, who voted to sell the ramp in May. “(If that deal had worked out) it would’ve been an 8-0 vote. For whatever reason it was not good enough then, but it’s good enough now.”
Jeffries also said that there may be political issues floating around the sale — that the mayor might not want to sell a piece of city property to Ferguson after the storm of criticism of his deal to develop a new state police headquarters in downtown Lansing.
Asked about the possible political implications of selling him the ramp, Ferguson said that he hoped they were not behind Bernero’s decision to favor LCC.
“That’s why I put on the record how much city taxes I paid the city of Lansing,” Ferguson said, speaking of a list of properties in Lansing he included with his offer to buy the ramp. He said the list totals $1.7 million last year.
“I’m not somebody that just came to town.”
State Rep. Rick Jones, R-Grand Ledge, the loudest critic of Ferguson’s state police headquarters, said that the developer’s name alone is not a political liability. Moreover, he said, Bernero’s avoiding a “middleman” will save taxpayers money.
“I don’t want to see Virg elected as governor,” Jones said. “However, if Virg Bernero has made this move to sell the parking structure directly to LCC thus saving the taxpayers money by not having middleman, I would say he has made an astute decision, not only politically, but also for the taxpayers.”
Jeffries said that it could be advantageous for the city to open up bidding on the ramp to see if there is someone else out there who might make a higher offer.
“The bottom line for me is I want to take care of neighborhood concerns and quality of life — and I want to get the best price for city in these financial times,” Jeffries said.
At-Large Councilwoman Carol Wood, who has voted against selling the ramp on two occasions, said much the same.
“I want what’s best for the city in the long run — our goals as far as economic development, as well as the general fund bottom line,” she said.