City ready to sell unfinished downtown parking ramp

Megan Raposa -

Simplified: The City of Sioux Falls is ready to be rid of the unfinished parking ramp on 10th Street – though they're still open to a lease. City Councilors on Tuesday heard the next steps in how the city will negotiate a sale of the property. Here's what you need to know.

Why it matters

  • The ramp was initially built as part of the since-failed Village on the River development – based on a 2017 agreement between Legacy Developments and the city. That whole thing ended with the city paying a $500,000 settlement which allowed them to cut ties with Legacy and move forward with a new plan.
  • Since that settlement – which happened back in March –  the city has had months of discussion on what comes next with various developers and industry groups, as well as several presentations to the City Council.
  • On Tuesday, the council heard plans for how the city could go about selling the property (and, though it's far less common in a negotiated sale process, leasing is technically still on the table, Business Development Coordinator Dustin Powers said.)
  • The council's biggest concern moving forward was that the city doesn't repeat its mistakes made in previous agreements on this property. They want to see the city take a close look at qualifications of buyers/developers – especially when it comes to their financial backing – something city leaders say they're already planning to do.
"All of those things will become very important in this project, both because of its history and because of its complexity," Planning and Development Director Jeff Eckhoff said.

What's different this time around?

The last time the city was looking for a partner in developing this process, they went through what's called a "request for proposals" (RFP).

  • The RFP process is a bit more rigid than the negotiated sale process, Powers said. It requires strict deadlines, and any questions applicants have must be posted publicly.

This time, the city is using a negotiated sale process.

  • The negotiated sale process lets the city chat with developers and prospective applicants at any stage of the process.
"At the end of the day what we like about this (sale) process is it leads to a better project," Eckhoff said.

The negotiated sale process also means different requirements for what information the public has access to along the way.

  • Applications will not be made public, Powers said, but once a proposal is chosen, a list of applicants will be released.
  • The city will also have to "self-govern" more in the negotiated sale process, Councilor Greg Neitzert said.
"In a process like this, if there’s a (application from a) disfavored developer it could just be thrown in the garbage," Neitzert said. "I’m not saying that would happen here, but there need to be guardrails."

How will the sale process work?

The first step is getting approval from City Council to put the property up for sale (or lease). That's expected to happen at the regular council meeting on Nov. 1.

Then, the city is expected to announce on Nov. 7 that it's ready to solicit proposals for the sale or lease of the property.

  • These applications must include project descriptions, financing, site plans, renderings and details about the development team and its past experience.

Applications will then move to a project team – members listed below – who will start reviewing applications on Jan. 7.

  • Once they select a proposal, the applications will close, and the city will enter negotiations.
  • After negotiations, it'll move to the City Council for final approval.

Project team members are expected to include:

  • Councilor Marshall Selberg
  • Business Development Coordinator Dustin Powers
  • Planning and Development Director Jeff Eckhoff
  • Finance Director Shawn Pritchett
  • Public Works Director Mark Cotter
  • Public Parking Manager Matt Nelson
  • A representative from the Public Parking Advisory Board
  • A representative from the 2035 Downtown Plan Advisory Committee

What happens next?

The City Council is expected to pass a resolution of intent to lease and list the property during their Nov. 1 meeting.

If that passes, city plans to start accepting applications Nov. 7.

Applications will be reviewed starting Jan. 7, and then it'll be up to the project team to conduct interviews, review proposals and ultimately present their recommendation to the council.

  • Then, it'll be up to the buyer or lessee to set the timeline for construction and development moving forward.
"It’s going to be a couple years before a final project is completed on this property," Powers said.