The City of Billings owns lots 1-8, block 226 of the Billings Original Town, generally located at 716-724 S. 27^th Street.  The Community Development program acquired the properties in the 1980s and held them for redevelopment.  The CDBG program subsequently released all CDBG restrictions on selling the property.  City staff received expressions of interest to acquire the property and advertised for sealed bids.  The City received two bids and the Council is being asked to consider selling the property to the highest bidder.   
 

The City Council must conduct a public hearing per BMCC 22-902 and then may:
 

• Approve the resolution transferring ownership of the property to A. L. Koelzer, or
• Approve the resolution and transfer ownership to G&L Properties/SNG Inc., or
• Disapprove the resolution and give guidance to staff about the property’s disposition.

The City received two (2) bids as follows:
            G&L Properties/SNG, Inc.                 $112,000
            A.L. Koelzer                                       $196,500

G&L Properties/SNG, Inc. owns the 3Gs store that is located on the north end of this block.  The owner intends to use the land to expand the business. Mr. Koelzer is a well known commercial real estate broker and has no specific plans for the property at this time.  Both bidders are obligated to meet the building and landscaping requirements of the S. 27th Street permit zoning district.

The CDBG program purchased the properties but released sale restrictions in 2012.  Those restrictions would have required that the land be used to benefit low and moderate income residents of the neighborhood and the funds would be returned to the CDBG program.  Since these restrictions are no longer valid, the funds may be used for any purpose.  Three options would be to deposit the funds in the General Fund, of which approximately 60% would go to Public Safety, or; deposit the funds in the Home Reinvestment Revolving Loan Fund, in which case the money could be used to assist the First Time Homebuyers Program, the Home Repairs Program or the Foreclosure, Acquisition and Rehabilitation program, or; deposit the funds in the Downtown Tax Increment District Fund and use the money for eligible downtown reinvestment projects. 
 

Staff recommends that the City Council conduct a public hearing and approve the resolution that authorizes selling lots 1-8, block 226, Billings Original Town to A.L. Koelzer for $196,500.  Further, staff recommends that the funds be used to supplement the Home Reinvestment Revolving Loan Fund.