Land Swap Is A Bad Deal For SCSU—What Else Is New!
by Silence Dogood
On April 17, 2015, this St. Cloud Times article announced a proposed land swap between the city of St. Cloud and St. Cloud State University. The article states: “The city of St. Cloud plans to swap three pieces of land with St. Cloud State University for the 50-acre park. The St. Cloud City Council will vote on the land exchange Monday.” The city property to be swapped is shown in blue in the following satellite image:
The property owned by SCSU to be swapped is shown in red in the following satellite image:
The scale in the two images is not the same. The following satellite image shows the two properties at the same scale. Clearly, the 50-acre parcel owned by SCSU is much larger than the combined three parcels owned by the city:
According to the article: St. Cloud owns three pieces of property near Fourth Avenue and 15th Street South that the university wants. Those pieces of land are worth $294,000. The park land is worth $328,000. From just the valuations stated in the article, SCSU is coming up on the short end by $34,000. However, if you look closely at the blown-up images of the properties, the city is clearly coming out way ahead!
Just by way of a historical reminder, the last time the city and SCSU worked out a deal it was for the “5th Avenue Live Project.” There’s no other way to say it. That deal was a complete failure and was cancelled after stage one. Unfortunately, as part of the project, SCSU entered into a lease with the Wedum Foundation and has lost $6,400,000 in the first four years of the project. It is on track to lose another $1,300,000 this year to bring the total to $7,700,000 lost in the first five years of operation! Since the lease runs for a minimum of an additional five years, SCSU may lose an additional $6,000,000 bringing the total amount lost to nearly $14,000,000 in the ten years required in the lease!
Since there has not been any discussion on campus of a potential land swap, it is not possible to know exactly why SCSU wants the city property. One might guess that it is to add parking spaces for students. In the satellite photo in the article, you can see the picture was taken during the winter while construction of the ISELF building was underway:
Clearly, classes are in session when the satellite image was taken because the faculty parking lots are fairly full. However, the student parking lots are clearly less than half-full! So much for needing additional parking. Also, since this picture was taken, the enrollment at SCSU has declined by over 20% so the argument that SCSU might need additional parking is simply a joke! In fact, SCSU has two mothballed high-rise dorms that have a total capacity of approximately 900 students. There is even discussion about demolishing one of them! Clearly, SCSU is not expecting these students to return.
In the satellite image, if you carefully examine the land SCSU is getting in the swap, it is pretty hard to see a lot of value in the storage yard where the city stores vehicles and stuff that it considers of such little value that the city chooses not to store it at the indoor storage facility in East St. Cloud.
Just for fun, let’s do a mental exercise. Let’s pretend that SCSU owned the three parcels of land south of the campus and the city owned the 50 acres of woods and quarries. Would it be a good deal for SCSU to accept an even up trade of its small three parcels of land for the 50 acres of woods? The answer is obviously YES! Not only would SCSU be getting a more valuable piece of real estate, it would be getting something that had the potential for development.
In fact, rather than the land swap, what if SCSU simply put the 50 acres up for sale to see if some developer might want to develop the property? While being adjacent to a maximum-security prison might not be the most desirable location for high-end homes, the city certainly thinks it’s a good location for a park. No matter what the use, SCSU might be able to sell the property for more than the valuation of $328,000, then buy the three parcels of property from the city and make $34,000 or more on the deal. SCSU is currently in the process of cutting $12,000,000 from its budget for FY16. While $34,000 might not make a lot of difference to a $12,000,000 deficit—every little bit helps! That $34,000 might even cover another trip to China for President Potter and his entourage.
The St. Cloud City Council is going to vote on the land swap on Monday evening. I’m going to bet that the vote approving the land swap is going to pass! I might even take bets about the outcome and be willing to give odds. In fact, it is hard to imagine that the vote by the City Council won’t be unanimous! It really is hard to think anyone on the City Council won’t vote in favor of the land swap. In my humble opinion, once again, the City of St. Cloud has stuck it to President Potter, SCSU and ultimately, the taxpayers.
Based on the recent history, I really wonder what Mayor Kleis has against President Potter and his alma mater. First, he got SCSU to buy into the “5th Avenue Live Project,” which will ultimately cost SCSU $14,000,000. Second, he got SCSU to pay $720,000 for three police officers over a three-year period to patrol the area around the SCSU campus. Lastly, he got SCSU to agree to a land swap that certainly looks like a pretty good dealfor the City of St. Cloud!
The only hope for SCSU is that the MnSCU Board of Trustees will say no to another bad deal for SCSU. However, this is the same board that recommended hiring Earl Potter as President of SCSU in the first place and then extended his contract. I guess there isn’t much hope for sanity prevailing.