A city board on Monday will consider an offer for a city parking lot on King Street that is less than the city paid for it 10 years ago.
Developer Hiren Desai is offering $134,700 for the lot that the city paid $195,000 for in 2007.
Mr. Desai is also offering to lease 85 parking spots at the site back to the city. Helen Burns Sharp of Accountability for Taxpayer Money said in three years the developer would get back the money he paid for the lot.
Mr. Desai is planning a nearby development, including the planned Moxie Hotel.
The Chattanooga Downtown Redevelopment Corporation will consider the offer at a meeting at 3 p.m.
Ms. Sharp also said that information about the offer for the lot was not posted on the city's website as it normally would be.
She said, "We have studied the proposed sale of a city owned parking lot on King Street to Seaford/Rivermont LLC (Hiren Desai). The CDRC is being asked to accept this proposal. ATM respectfully requests the board table the resolution until members get more information about the purchase price and the proposed lease back arrangement.
"This is about the board’s fiduciary responsibility to represent Chattanooga taxpayers.
"The CDRC currently owns a parking lot at 1200 King Street. The city bought it in 2007 for $195,000. It accommodates about 85 cars and is full during the day with city employee and fleet parking. Mr. Desai plans a mixed-use development adjacent to the lot. He is offering to pay $134,700. Further, he proposes to lease back the 85 parking spaces for $45.77 per space monthly for three years ($140,000).
"The purchase offer is less than what the city bought it for 10 years ago. Under the leaseback proposal, within three years the “city” would give the developer more than he paid for the parking lot. This lot is located in the Southside, a very hot real estate market. Very close by, at 1225 Cowart Street, another gravel parking lot sold for $700,000 in 2014 and $2,056,800 in 2016.
"We are perplexed as to why the RFP package did not give a minimum purchase price of at least $500,000 and a maximum leaseback amount much lower than the one proposed.
"Citizens expect the board to negotiate a fair deal for taxpayers. Please do so.
"This is about government transparency.
"When meetings are posted on the city’s online calendar, the meeting notice normally contains links to the most relevant documentation about agenda items. For this meeting, the only things posted were the resolution and the letter from the Purchasing Department recommending Mr. Desai’s proposal. The letter did not mention his proposed purchase price or his leaseback proposal. This letter alludes to evaluation criteria but does not list them. It alludes to multiple proposals but does give the names of the other “proposers” or how much they offered.
"When ATM asked for a copy of the recommended proposal, the criteria and the names of others submitting proposals, we were told to file an open records request through the city attorney’s office. This information is readily available at City Hall. Why did the City not post more information initially? Why did they make citizens jump through bureaucratic hoops to get it?
"This is about public trust.
"If the CDRC accepts a financial proposal that is one-sided in favor of the purchaser and makes it difficult for citizens to access public records, it creates the impression that a political deal has already been struck and that they are merely going through the motions. Thoughtful discussion by the CDRC at this meeting and the willingness to revisit the terms could help restore that trust."