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ffm l E M a, # la e IBM „f+A ). 1 itics occasionally own real or per- sonal property that they no longer need and wish to dispose of. "Real. property" is real estate, or basically land and things attached to land such as buildings, Cities can often 8 convey, real property that is no longer i ceded."Personal property" is something subject to ownership that is not classified as real property, such as vehicles or equipment. Cities may own unneeded or unwanted personal prop- erty, such as obsolete office equipment, furniture or computers.There are a number of issues to consider when disposing of surplus city property. Cities should always consider the value of city property to be disposed. If the property has any morretary value, disposal of the property without rennr- neration arguably is akin to a municipal expenditure subject to the public pur- pose expenditure doctrine. In order for an expenditure of public funds to be lawful, there should be a public purpose for the expenditure, and there must be specific or implied authority for the expenditure in statute or in the city's charter. (See League research Menlo, Public Puipiose Expenditures available in the Library section of the LMC web site at: vwvw.lmnc.org.) State law authorizes statutory cities to acquire, manage, and dispose of real and personal property. Minnesota Stat- utes Section 412.211 specifically autho- rizes a statutory city to sell, convey, lease or otherwise dispose of real and personal property as its interests may require. Charter cities may have other provisions in their charters regarding their authority over real and personal property. Specific questions concerning a city's authority should be directed to the city attorney. Disposal of property by transferring it to another party is generally con- tractual in nature.Just like purchasing property, if property to be disposed of By Jed Burkett consists of supplies, materials or equip- ment, the contract is subject to the uniform municipal contracting law (Minnesota Statutes Section 471.345). If the contract is estimated to exceed $50,000, the city must use the corupeti- tive bidding process. If the contract is estimated to exceed $10,000 but not $50,000, the city has the option of using the competitive bidding process Or making the contract by direct nego- tiation. If the contract is estimated to be less than $10,000, the city has the option of making the contract upon quotation or in the open market. (See League research memo, Conipetitive Bid- ding. Requirements in Cities, available in the Library section of the LMC web site at: wwwlnnmc.org). Contracts concerning the purchase or sale of real property are not generally required to be competitively bid. Statu- tory cities may dispose of real property not held in trust for a specified public use. Cities generally have the power to sell or lease land or buildings they no longer need. Housing redevelopment authorities and economic development authorities must hold a public hearing before selling or leasing most land. There are a few limited situations tinder which a city may give away land or sell it for a nominal amount of money. (See League research memo, Purchase and Sale of Real Property, available in the Library section of the LMC web site at: tvww.lmnc.org.) Different considerations may arise depending on the intended recipient of the property The disposition of city equipment, supplies, materials or other property, including real property, to the federal government is not subject to the uniform contracting law or other char- ter: or statutory provisions (Minn. Stat. Sec. 471.64). Also, a city may uAnsfer its personal property for nominal value or without compensation to another public corporation such as a county or MARCH 2005 MI NNEso II, CI"I')Ls school district for public use (Minn. Stat. Sec. 471.85). Cities are generally prohibited from selling city property to city employees or officials. However, property owned by a city may be sold to a city employee after reasonable public notice at a pub- lic auction or by sealed response, if the employee is not directly involved in the auction or process pertaining to the administration and collection of sealed responses (Minn. Stat. Sec. 15.054). other requirements relate to disposal of unclaimed, forfeited or abandoned property. Property lawfully conning into a city's possession in the course of municipal operations, and remaining unclaimed by the owner for a period of at least 60 days, may be disposed of by the city under an unclaimed property ordinance providing for sale at public auction or through a community ser- vice nonprofit organization (Minn. Stat. Sec. 471.195). Disposition of prop- erty forfeited to the city in connection with criminal activity and the distribu- don of resulting proceeds is specifically governed by state law (Minn. Stat. Sec. 6095315). Similarly, state law governs the disposal of impounded abandoned motor vehicles (Minn. Stat. Ch. 168B). Additional information. For further information, or to request copies of relevant state statutes or League research memos, pleatie contact the League's Research Department at (651) 281- 1220 or (800) 925-1122. Research mennos are also available on the LMC web site. Please consult your city attor- ney for specific legal advice concerning the disposal of city property. Ir Jed Burkett is reseanrh attorney urith tine League ofAfinne.sota Cities. Phone: (651) 2814224. E-mail: jburkett(k�inrac. org.