NEW HARMONY TOWN COUNCIL TABLES BIDS FOR SCHOOL

THE NEW-HARMONY GAZETTE.

by: Dan Barton-Publisher, March 2019

There were six bids and one request for a 120-day delay in the decision process, while a group of investors evaluates the condition of the neglected former New Harmony School building.

It was revealed at the February, New Harmony Town Council meeting that the highest bidder for the New Harmony School building and the surrounding 31 acres, in the most recent round of bids, was New Harmony resident Erik Arneberg. Mr. Arneberg’s bid was for $125,000. Arneberg was $44,500 higher than the next highest bid, which was from Joe Lupfer of Cynthiana, for $80,500.

Mr. Arneberg stated, “I don’t have a concrete plan today. I just want to assure you that my intentions are to do the utmost that I can to save the school. I felt it was my obligation to save the building. I don’t want to see it torn down for an asphalt plant or anything. I can assure you that I’m not going to use it for the storage of nuclear waste. My bid is on the table.” The nuclear waste statement brought a chuckle in the audience. It’s a relief to know that that’s not in his plans.

Joe Lupfer was not in the audience, nor did his bid say what he wanted to do with the school property, but Council President Alvin Blaylock, speaking on Lupfer’s behalf, said that he has had private conversations with Lupfer and was told verbally, “He wants to demolish the building and turn the property back to agriculture, but it’s not in writing.” Mr. Lupfer’s bid for the entire property was for $80,500.

Baize Contracting, Jason Baize owner, bid a total of $12,000 for the building, the shelter, the pole barn, the parking lot and the low lying four acres acres to the south of the building. While offering another $73,000 for the balance of the surrounding acreage, to be paid over a two year period. For a total bid of $85,000. Baize indicated that the Town of New Harmony would be responsible for the walking/cart path and that the second bid is void without the acceptance of the first bid. Council President Blaylock did not specify what Mr. Baize planned to do with the property.

Evansville Attorney Andrew Goodridge filed a secondary bid, it was revealed in the meeting, on behalf of Erik Arneberg, in the amount of $80,000. It was for five acres on the north end, possibly the baseball field and also for four acres to the south end, the low lying excavated area, also for 13.185 acres to the east, which includes the power line area, croplands and walking path. Neither Mr. Arneberg nor his attorney specified what the use for the land would be.

Tom Guggenheim of Mt. Vernon bid $40,000 for the five acre baseball field and $39,000 for the thirteen acres, or $3,000 per acre, for the land currently being tilled under the power lines. For a total of $79,000. Mr. Guggenheim’s intended use of the property is to run a small tree nursery with about 10 – 20 thousand trees, eventually expanding to a mulch yard, tree pruning and removal service. He plans to move to New Harmony in the near future, after he retires from SABIC.

The sixth bid was from Pastor Richard Giles and the New Life Apostolic Church of Carmi, Illinois. The bid was $10,000 for the school building and five acres of the parking lot. The intended use is for church services and church activities. The gymnasium would be used for community events and for youth retreats.

Though not a bid per se, a letter of support for Erik Arnsberg’s bid, and an appeal for time to evaluate the school building condition, was also filed by a group of businessmen; Jeremy Efroymson, Kent Parker, George Rapp and Dan Mason. They are asking for a 120 day pause in the proceedings in order to get a, “thorough and current assessment of the school building’s condition and the costs associated with necessary remediation and repairs.” This group has found a company that will do the assessment. They will pay for the study through a grant from the Efroymson Family Fund.

The discussion on the matter of the sale of the former New Harmony School and property went on for over half an hour. It was a full house with standing room only.

In the end no decision was made concerning which bid or proposal would be accepted. A motion to table the matter until the March meeting was passed by the Council in order for them to do an investigation and to have discussions with the bidders over the next month to determine their exact use.

According to Council President Blaylock, “There are certain steps we have to take under the state codes and that is the direction we will follow.” Up to this

point Blaylock and the Council have followed Indiana Code, and then some. They bypassed listing the property with a Real Estate agent in the prior Council meetings when they could have. They instead opted for another round of bidding. The bids this time were a little better but still not anywhere close to the $360,000 appraised value of the property.

Councilman David Flanders tried to interject the discussion with a prospectus from an Evansville Real Estate Marketing firm that he believed the Council should consider under the circumstances, but he was unable to get any serious consideration from the Council President. The Town lawyer Erin Bauer interrupted his appeal by asserting that, for the Council to take steps to hire a real estate agent they would have to publish a notice to all bidders and reject all of the current bids. She indicated that they would also have to have a reason to reject those bids. All of those current bids were over the minimum. Councilman Flanders ended this discussion by saying that he thought the Council should, “still reach out to a broader market, notwithstanding the ongoing discussions.”

A good deal of what the Council President and the Council’s lawyer talked about had to do with this investigation that was about to get underway for the next month. Mr. Blaylock said they were going follow the steps under Indiana Code. He initially said that he wanted to table the discussion on the bids, “Until we can get with Erik and his group and let them present their plan to us and see exactly what they want to do.”

Blaylock says he plans to follow Indiana Law, Indiana Code, to the letter. He says his plan is to “see exactly what they want to do,” particularly it seems, Erik Arneberg and his group. But Indiana Code does not demand this type of “investigation,” nor did the advertisement that the Town of New Harmony ran pertaining to the sale of the property have this requirement. Indiana Code -36-1-11, specifically addresses the issue of the steps to follow in selling surplus town property. It addresses the issue of bids by saying in paragraph 36-1-11-4, Sec.4, (f), “The disposing agent may, before expiration of the time set out in the notice, sell the property to the highest and best bidder.” In my opinion this is not ambiguous language in any way.

Blaylock went on to say, “ I would entertain a motion to table till we can have a further investigation as to what the uses are.” Later, after Town lawyer Bauer and Erik Arneberg had a conversation in the meeting, Council President Blaylock said, “The motion is to table the bids so we can have discussions with the

bidders as to their exact use.” He has changed his approach from just looking at Arneberg’s use of the school property alone, to the use by all the bidders. He is now looking at “exact use.” He says he is doing this, “To gather information and work with the people.” It’s not clear how he wants to work with them. All of the bids are on the table and state law says he can sell the property to the “highest and best bidder.” It says nothing about the bidders use.

Now, lawyer Bauer goes even further off course by saying, “Unfortunately the statute is not the most perfectly written statute. It doesn’t say, after the bids are closed what the council has to do. The option is that it’s the highest and best bidder.” There! She has answered her own question! The law is clear. But she goes on and says, “The question is, what does “Best” mean?

Here is what “Best” means, according to the real estate definitions I have read. It means that whichever bidder comes across with the highest dollar bid and the most efficient and advantageous way of paying that bid to the town, wins. In other words, if a bidder bids $125,000, and that is the highest bid, and he has the cash, then the award goes to that bidder. On the other hand if the $125,000 bidder does not have the cash and must seek financing, which could take weeks, and the lesser bidder has the cash, then the award can go to the lesser bidder.

It doesn’t require any more of an investigation than that. It’s town zoning laws that protect the use of the property for the public good, not Mr. Blaylock, and not the Town Council, from how I see it. A bidder who wants to build a factory or use the school property for industrial purposes would be barred by the town’s zoning laws, not some subjective judgement from Alvin Blaylock or the Town Attorney.

Lawyer Bauer then asks a question of the Council President, she says, “So the next step, because Erik is the highest bidder, is to have the Council, between now and March to further understand the purpose of Erick’s use. Correct?

Blaylock responds, “Yes!” She’s kidding, right? The town attorney is asking the Council president for his legal opinion on this subject? Who’s kidding who here?

Finally, Blaylock goes even further by saying, “So we’re looking at two items. One is the “Best Use” of the property for the Town of New Harmony and for the residents of New Harmony. That’s what we’re looking at.” So, who decides what’s best for New Harmony, a corn and bean field, a tree farm, offices for a construction contractor, a public use venue, or a church. Who decides this? Alvin Blaylock? You see he has now shifted from the term “Highest and Best” to another real estate term called “Highest and Best Use,” to close his meeting.

“Best Use” is not what the Indiana Code, the law, says. It’s a term used by appraisers to determine return on investment of a property for their client. To determine which property returns the best income and what particular use of that property gives it the best return for the buyer. It has nothing to do with the subject being discussed in this town council meeting, “Highest and Best Bid.” Lawyer Bauer sat silent!

Are you getting my point folks? I call this shift in language an “Alvinism” and I’ve seen it before. Pay attention bidders!