The mayor is proposing to remove public input from the final sale of any land owned by the city. In a lot of cases, these land sales will be conducted by private brokers. In comparison, the Union-Tribune reported last Sunday, that most other cities use public auctions to sell land. This is a significant issue, since the mayor intends to sell $100 million worth of “surplus” land in the next five years to help finance our neglected infrastructure.

So there are two significant parts in the mayor’s proposal:

1)Reduce public input in sale of public land.
2)Use private brokers to sell public land.

In this post, I will be discussing the first part of the proposal.

The first part of the mayor’s proposal is to remove the public from impacting the final sale of public land. Current Council Policy 700-10 regarding the sale of land requires the council to direct the mayor’s staff to sell land using the criteria voted on by the council. The current policy also requires the mayor’s staff to come back to the council for final approval of land sales, after they have got an offer. The policy proposed by the Mayor keeps the first hearing (regarding direction on sale of land) but eliminates the final public hearing (regarding the sale itself). The “public” owns this land, but will be excluded from the final say.

Ostensibly, the rationale for this proposal is to increase revenue. Public input creates uncertainties, which adds to the cost of doing business with the city. Therefore, reducing public input will reduce the risk-premium from offers by developers. This rationale is played out in several reform measures in land-use proposed by the mayor. The intent is that savings by developers will be passed on to savings for the public.

This comes at the cost of sacrificing some level of public input. Regardless of what one’s opinion is on the performance of the city or the council, the only way the John Q. Public can have a voice on a particular transaction is through a City Council hearing. It is thus appropriate to look beyond personalities, and short-term gains, and address questions about the long-term public good:

1) Without a public hearing or vote, how do we know what’s best for the public? Let us suppose there are competing bids for a price of land, over the pre-approved price set the council. The lower bid proposes some public benefits such as affordable housing or community parks. The higher bid proposes a hotel paying higher taxes. Or an even higher bid from a strip club owner. Whom does the mayor sell the land to?

2) Are council criteria set at the beginning of the process the best deal for the public? As most real estate experts will acknowledge, you never know the real gem in your properties, till you actually place it on the market. If the property was originally under-valued, or during the course of time became a prized jewel, the original criteria may be irrelevant. Is the Council (and by default the public) being treated as an obstacle to overcome early on, rather than a serious partner in making final decisions?

3) Future Uses of the Public Land?Can the public be certain of the future use when public land sales are done behind closed doors? When there is a public hearing in which a developer/buyer has to show up, they will inevitably be quizzed about what they will do with the public land. They may need to offer public uses to get political support, and possibly sign a development agreement. This informs the decision on whether to sell the land or not. When you separate the land sale from the development approval, lo and behold, the property gets transferred from the public to private sector, and then it’s nobody’s business what a developer does with it.


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