SB-1124, As Passed Senate, June 23, 2004                                    

SUBSTITUTE FOR

SENATE BILL NO. 1124

                                                                             A bill to authorize the state administrative board to convey                      

or transfer certain state owned property in Alpena county; to               

prescribe conditions for the conveyance; to provide for certain             

powers and duties of certain state departments in regard to the             

property; and to provide for disposition of revenue derived from            

the conveyance.                                                             

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

1       Sec. 1.  The state administrative board, on behalf of the                   

2   state and subject to the terms stated in this act, may convey for           

3   not less than fair market value all or portions of certain state            

4   owned property now under the jurisdiction of the department of              

5   state police and located in the city of Alpena, Alpena county,              

6   Michigan, and more particularly described as follows:                       

7   Commencing at the section common to Sections 27, 28, 33, and 34,            

8   thence along the section line common to Sections 33 and 34, 210             

1   feet to the west line of State Street, thence along the west line           

2   of State Street, 1,005 feet thence at right angles to State                 

3   Street, 27 feet, to the point of beginning, thence at right                 

4   angles to State Street, 156.6 feet, thence along a curve having a           

5   radius of 2,704.58 feet, 218.2 feet, thence at right angles to              

6   State Street and towards State Street 69.5 feet, thence at right            

7   angles and paralleled to State Street 200 feet, to the point of             

8   beginning, said parcel containing 0.518 acres, more or less.                

9       Sec. 2.  Before offering the property described in section 1                

10  for public sale, the director of the department of management and           

11  budget shall first offer the property for sale for less than fair           

12  market value to the local units of government in which the                  

13  property is located.  In order to exercise its right to purchase            

14  the property under this section, a local government must enter              

15  into a purchase agreement within 60 days after the date of the              

16  offer and must complete the purchase within 120 days after the              

17  date of the offer.  If a local unit of government purchases the             

18  property and, within 1 year after the date of that purchase,                

19  conveys the property for use other than for public purposes, the            

20  local unit of government shall pay to the state 50% of the net              

21  profit, if any, realized from that conveyance.                              

22      Sec. 3.  Any conveyance to a local unit of government                       

23  authorized by section 2 shall provide for all of the following:             

24      (a) The property shall be used exclusively for public                       

25  purposes and if any fee, term, or condition for the use of the              

26  property is imposed on members of the public, or if any of those            

27  fees, terms, or conditions are waived for use of this property,             

1   resident and nonresident members of the public shall be subject             

2   to the same fees, terms, conditions, and waivers.                           

3       (b) Upon termination of the public purpose use described in                 

4   subdivision (a) or in the event of use for any nonpublic purpose,           

5   the state may reenter and repossess the property, terminating the           

6   grantee's estate in the property.                                           

7       (c) If the grantee disputes the state's exercise of its right               

8   of reentry and fails to promptly deliver possession of the                  

9   property to the state, the attorney general, on behalf of the               

10  state, may bring an action to quiet title to, and regain                    

11  possession of, the property.                                                

12      Sec. 4.  The fair market value of the property described in                 

13  section 1 shall be determined by an appraisal prepared by an                

14  independent appraiser.                                                      

15      Sec. 5.  If the property is offered for sale at not less                    

16  than fair market value, the sale shall be conducted in a manner             

17  designed to realize the highest price from the sale or the                  

18  highest value to the state.  The sale of this property shall be             

19  done in an open manner that utilizes 1 or more of the following:            

20      (a) A competitive sealed bid.                                               

21      (b) Real estate brokerage services.                                         

22      (c) A public auction.                                                       

23      Sec. 6.  A notice of a sealed bid, public auction sale, or                  

24  use of broker services regarding the property described in this             

25  act shall be published at least once in a newspaper as defined in           

26  section 1461 of the revised judicature act of 1961, 1961 PA 236,            

27  MCL 600.1461, not less than 10 business days before the sale.  A            

1   notice shall describe the general location and size of the                  

2   property to be offered, highlights of the general terms of the              

3   offer, and directions on how to get further information about the           

4   property, as available, prior to the sale.  The notice shall also           

5   list the date, time, and place of the sale or bid opening.                  

6       Sec. 7.  The description of the parcel in section 1 is                      

7   approximate and for purposes of the conveyance is subject to                

8   adjustments as the state administrative board or the attorney               

9   general considers necessary by survey or other legal                        

10  description.                                                                

11      Sec. 8.  The net revenue received under this act shall be                   

12  deposited in the state treasury and credited to the general                 

13  fund.  As used in this section, "net revenue" means the proceeds            

14  from the sale of the property less reimbursement for any costs to           

15  the department of management and budget associated with the sale            

16  of the property, including the cost of securing discharge of                

17  liens or encumbrances.  If the revenue received under this act is           

18  insufficient to reimburse the department of management and budget           

19  for its costs of using outside vendors in surveying, appraising,            

20  and closing the sale of the property offered in this act, those             

21  costs shall be reimbursed by the department of state police                 

22  within 30 days after being presented an itemized bill for those             

23  costs.                                                                      

24      Sec. 9.  The conveyance authorized by this act shall be by                  

25  quitclaim deed prepared and approved by the attorney general,               

26  subject to easements and other encumbrances of record.  The                 

27  quitclaim deed shall provide for both of the following:                     

1       (a) If the property is reentered and repossessed by the                     

2   state, the state shall have no liability for any improvements               

3   made on the property.                                                       

4       (b) The state reserves all rights in aboriginal antiquities,                

5   including mounds, earthworks, forts, burial and village sites,              

6   mines, or other relics, including the right to explore and                  

7   excavate for the aboriginal antiquity by the state or its                   

8   authorized agents.                                                          

9       Sec. 10.  The state shall not reserve the mineral rights to                 

10  the property conveyed under this act.  However, the conveyance              

11  authorized under this act shall provide that, if the purchaser or           

12  any grantee develops any minerals found on, within, or under the            

13  conveyed property, the purchaser or any grantee shall pay 1/2 of            

14  the gross revenue generated from the development of the minerals            

15  to the state, for deposit in the state general fund.                        

16      Sec. 11.  If the property described in section 1 is not sold                

17  pursuant to section 2 and fails to sell at a public sale for fair           

18  market value, the director of the department of management and              

19  budget with the concurrence of the state administrative board may           

20  do any of the following:                                                    

21      (a) Order a reappraisal of the property.                                    

22      (b) Withdraw the property from sale.                                        

23      (c) Offer the property for sale for less than fair market                   

24  value.                                                                      

25      Sec. 12.  If the property is offered for sale pursuant to                   

26  section 11, the sale shall be conducted in a manner designed to             

27  realize the highest price from the sale or the highest value to             

1   the state.