Birds of Prey 
By Mary Souza, June 12, 2008
It feels like defiant birds are circling, circling, circling. Their target: The taxpayers of Coeur d’Alene. And the prey doesn’t stand a chance.
I attended the General Services meeting at the City of Coeur d’Alene this past Monday. Three city council members listened as City Administrator Wendy Gabriel described the proposed agreement to “lease” the Harbor Center building and land to the University of Idaho for 99 years. If the college chooses to renew the lease after 99 years, (mark that date on your calendars!) they can extend it out to 198 years.
What kind of foolishness is this? 99 year lease? or 198 years? This building was purchased through a Public Revenue Bond for the expansion of the city’s Wastewater Treatment Plant. We, the citizens of CdA, voted to approve the Bond and we paid higher utility rates for many years to pay it off. Now the City is virtually giving the riverfront building and land to University of Idaho without so much as a public hearing to give the ratepayers a voice.
And the price for this huge building with 7.5 acres of riverfront property? Only about $1,000 per month. Less than most people pay for their home mortgage. It’s a total of $1.3 million dollars over a 99 year lease.
There is no appraisal on this building, it’s value is undocumented. But I bet even we average citizens could estimate it’s worth pretty closely. If the DeArmond Mill site on the other side of the sewage plant is supposedly worth $588,200 per acre, then the Harbor Center’s 7.5 acres are worth $4.5 million dollars. Add another million and a half for the large building and we’re up to $6 million, easily.
So why would our city leaders take a $6 million dollar asset and basically give it to a State University for $1000. per month?
This asset is owned by the citizens of CdA. We are a city. Cities do not tax for public education. NIC taxes everyone in Kootenai County. But the University of Idaho and all other public 4 year colleges are funded by taxes paid to the State. Not to cities. So our city money should be going for city needs, not state level higher education.
Our Mayor and City Council will decide this Tuesday, June 17th, whether the taxpayers of Coeur d’Alene will have a $6 million dollar asset leased away forever to a state college. This value will be in addition to the $10 million dollar DeArmond Mill site NIC wants us to fund with the other taxpayers of Kootenai County. The birds of prey are getting closer and they seem hellbent on their target: Our tax dollars without our input.
State Legislators Mike Jorgenson, Bob Nonini and Frank Henderson have all publicly asked the City and NIC officials to wait and review these proposals. Business leaders like Dennis Wheeler of CdA Mines and Bob Potter, retired head of Jobs Plus have advised reevaluating the process. But City and NIC officials are not taking heed. The Editor of the local paper has twice asked for caution, time and more public involvement before these decisions are made. Yet no public hearings are planned.
At the city’s General Services meeting,I was the only member of the public present. Jack Dawson from U of I, ever the gentleman, was sitting next to me in the front row. I raised my hand several times trying to ask one question: “Will you wait and hold a public dialog on this important decision?” But the three council members on the panel, John Bruning, Deanna Goodlander and Ron Edinger, would not call on me. They all looked away and pretended not to see me. They approved the Harbor Center lease quickly and directed it onto the Agenda for next Tuesday’s full City Council meeting.
I approached the panel of council members after the meeting and carefully expressed dismay at not being able to ask my question. They responded, “We don’t have to allow questions from the public.” Deanna Goodlander then added, with a sneer, “but you can write about it”. I assured her I would. She then told me about the City Council meeting next Tuesday, warning “it’s not a public hearing”.
There have been no open meetings to give citizens clear and specific information about this decision; no opportunity for public questions or input. There was no public hearing back in 2002, when Mayor Bloem signed the first MOU (Memorandum of Understanding) giving lease rights to U of I for 5 years. There was no public hearing when that MOU was renewed in 2006, again signed by the same Mayor. The ’06 lease is good until 2010, so why is there such a rush to get this new agreement pushed through the system this month? Why not wait and include the public as our State Legislators and business leaders have requested?
The rush is probably because NIC needs the City’s $1.3 million dollars from the U of I to help buy the DeArmond Mill site. But that’s city money. How will the City of CdA transfer $1.3 million in city money to NIC, which is a totally different taxing entity?
Your guess is as good as mine, but rest assured, they will finagle a way. The Harbor Center was the old Osprey Restaurant, and that seems appropriate. The Osprey…one of Idaho’s famous birds of prey. They are circling, closer and closer, and we, the taxpayers, don’t have a chance…or a voice.
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BUT, but, but they are not “trustee representatives” of the City of Coeur d’Alene. What standing have they, eh? Trust the Mayor and Council, after all they are simply elected officials doing their best, right?
It is passing odd that the City that demanded a public advisory vote on the Hagadone garden proposal feels that nothing else is worthy of a vote or even public input. It is even more passing odd that SD 271 and both their Board of Trustees, management and Long Range Planning Committee seem to interloc so well with LCDC, NIC and the City of Coeur d’Alene on these irresponsible and massive transfers of assets without public input.
There may be legal issues as well. A Bond voted by the people brought this for a specific purpose. To dispose of it may be governed by that Bond and/or real estate sales and purchase agreement. There maybe Federal Laws that need to be examined. But then again, we elected these people, we must trust them. And their Inside Connections. Right?
Comment by Pariah — June 12, 2008 @ 6:55 pm
Well done Mary. No doubt the birds at City Hall will be screeching again.
Comment by Pariah — June 12, 2008 @ 7:05 pm
Excellent analysis on this latest fiasco, Mary. Questions. Is the city going to get the 1.3 million up front for the 99 year lease – or just $1,000 a month for 99 years?. BTW, the math does not match. If on a month to month payment from the U of I, how does that help NIC pay it towards the 10 million for the purchase of the EC? And then as you point out, in either case does the city just write a check to NIC?
Comment by Gary Ingram — June 12, 2008 @ 7:53 pm
LCDC Gary, LCDC!
Comment by Pariah — June 12, 2008 @ 8:18 pm
Gary, the contract between the City and U of I, which you can find on the City’s website, states the following:
” Rent for Term of Lease shall be one million three hundred thousand dollars
($1,300,000.00) and shall be paid to Landlord no later than September 30, 2008.”
There you go. They want/need the money now. It equates to just over $1000/mo for 99 years, but pay it now because we need it!
Comment by mary — June 12, 2008 @ 9:22 pm
Too bad the U of I isn’t interested in the old Library building . . .
Comment by Dan — June 12, 2008 @ 9:28 pm
We need to send our public officials a message, by voting out an incumbent
from office.That hasn’t happened lately,so it’s business as usual for them and the public has no say over their decisions.I certainly, don’t feel represented by these people.
Maybe a recall is in order,so these elected public officials receive the message that we want to have a say,on the decisions our local gov’t makes.
I remember working on the Osprey,
back in 1984 and am ambivilent about the U of I 99 year lease of the building.On the one hand,it’s good for the community for a university to maintain a presence in CDA.On the other hand, the people have no say on what actions the city council takes.Couldn’t NIC use the building,
to expand their campus?
I’d say the university of Idaho,is getting a helluva’deal!
Comment by kageman — June 12, 2008 @ 9:45 pm
Dan,mentioned the old library building on Harrison.It’s a smaller
building,so why not lease it to LCSC?
They also, have a presence here in CDA but,on a smaller scale.
Comment by kageman — June 12, 2008 @ 9:57 pm
“They want/need the money now. It equates to just over $1000/mo for 99 years, but pay it now because we need it!”
There is this pesky thing called the “time value of money”. If the gross amount due under the lease is $1,000.00 per month for 1,188 months or $1,188,000, then the net present value of that future income stream is FAR less. Like way, way less.
Comment by Pariah — June 12, 2008 @ 9:59 pm
Great call, Kageman. I do believe “RECALL” will be the only thing that might open their eyes. The sooner the better.
Mary, your awesome! Thanks for being on top of things.
Comment by longshot — June 12, 2008 @ 10:02 pm
What is being missed here is the confidence on the part of the powers that be that this is a “done deal”. That can only be the case if the key player, Mr Chesrown has signed off on the “fix is in” . So when did that happen?
Look at the State of Idaho Business organization for June 2006 and you will find registration of “The Mill Sites, LLC”.
Mr.Chesrown separate from his other FORTY business entities registered to do business in the state of Idaho.
Who are these guys and what do they know that we do not?
Roger A. Nelson signing as Rutro, LLC. for Mr. Chesrown and ????
Guess the everyday citizen is going to need a detective or two to figure this out.
Comment by Granny — June 12, 2008 @ 10:57 pm
The current lease on the Osprey is to the U of I for what? Something like $1,000/year? Regardless, the U of I then turns around and charges other tenants in the building rent, which makes the Osprey a profit center for the U of I. I believe they charge LCSC $6,500/month for rent. They also charge the ISP for its lab. The City knows that and yet they continue to give U of I a sweetheart deal while U of I gouges the other tenants unnecessarily. What’s to say the U of I won’t continue to do that? How is that fair to the other agencies and how does it benefit City taxpayers?
Comment by Dan — June 13, 2008 @ 7:28 am
Dan, the current lease, that’s good until 2010 is for $10 bucks a year. Ten.
Comment by mary — June 13, 2008 @ 7:58 am
Heck, I would have given the city $2000 MAYBE even $3000 a year for the next 99 years for my business!
Comment by concerned citizen — June 13, 2008 @ 7:52 pm
landlords often give discounted rents for advance payment.
Comment by reagan — June 14, 2008 @ 6:54 am
True . . . in the real world! But in the real world you also don’t charge $10/year for multi-million dollar waterfront property, which is what the wastewater rate payers of Coeur d’Alene paid for the building. This again shows that respecting the taxpayers is not on the list of priorities for CdA City Hall.
Comment by Dan — June 14, 2008 @ 8:18 am
“landlords often give discounted rents for advance payment.”
Comment by reagan — June 14, 2008 @ 6:54 am
How many square feet and acres for $1000 per month not to mention the $10 a year? Discount? How much does this total per square foot? Talk about giving the tax payers the shaft. I wonder if the city has any more property I could lease from them. I would be MORE than happy to pay in advance for a lease that is pennys on the dollar.
Comment by concerned citizen — June 14, 2008 @ 4:23 pm
Where’s Mark Altman when you need him? Like Mark points out WE elect public officials to be the voice of the people. So I ask who trumps who? We have two state representitives asking for accountibility who seem to have absoutely no power in the program and the University of Idaho is a state college, seems there is a hole in the bucket. And our tax dollars are pouring out.
Comment by casper — June 16, 2008 @ 6:40 am
Well said, Casper. It is amazing that our state level elected officials can’t seem to get the respect they deserve from the City and NIC. Rep. Bob Nonini is the Chairman of the House Education Committee and both Senator Mike Jorgenson and Rep. Frank Henderson sit on the Joint Financing Committee that sends state money to NIC and U of I. I don’t think these Legislators should be ignored!
(note: NIC gets a large portion of it’s money from the taxpayers of Kootenai County, but a significant amount also comes from the State. U of I is primarily funded by the State.)
Comment by mary — June 16, 2008 @ 7:17 am