WEST SACRAMENTO (MPG) - In 2018 Aaron Laurel was appointed City Manager for West Sacramento and CEO of the Port of West Sacramento. Prior to being City Manager, Aaron served West Sacramento as Economic Development and Housing Director. The City of West Sacramento’s website says that Aaron oversees investments in infrastructure and real estate, business attraction, affordable housing, and management of the port.

Are these two jobs subject to a conflict of interest? It doesn’t seem like they would be. However, here’s the problem… Aaron oversees guiding the construction of the city as it grows. Many projects come before him – he has the job of figuring out how the different projects will merge and how they will be financed. This can be a very daunting job. There is no question about that. He must be a master at moving funds around to get everything paid for as things come up.

However, the recent sale of prime Port property is raising questions of conflict of interest and the appointments of the Port Commission. The prime real estate in question is the property located at 2440 Southport Parkway, directly across from Lowe’s. As prime real estate, with so many options available for that land, this land should be sold to a developer for $8 - $9 per square foot. Because a complete infrastructure will be required, it would not be uncommon for a deal to be made on the purchase price.

Well, a deal was made, but certainly not the deal anyone would expect. Smart Growth Investors (Mark Freeman - buyer) has been given the deal of a lifetime. For a $50,000 deposit Mark will get an option to purchase a portion of the 59 acres known as the International Seaway Property. The option lasts for three years and as long as Mark submits a planning application and design review package for the International Seaway property and submits construction documents for BioSpace at the Bridge District (a separate development) he gets an automatic two-year extension. The submissions do not have to be accepted by the City of West Sacramento or the Port.

Mark essentially has five years to purchase the Seaway property for $5 per square foot. But he does not have to buy it all at once. If he buys at least 30.74 acres of the property within the five years, he will get another three-year option to buy the remainder of the property for another $50,000 down. This will happen again in the third and final option period.

After the 6^th year (at the start of the second period) the price is finally raised to $5.50 per square foot, per year. That’s a good deal for land that should be sold at $8 - $9 per square foot. This is the kind of deal you would get if you were paying for the infrastructure in the development.

In this deal, the Port agrees to “assume financial responsibility for all cost of developing the project.” Development costs include the design, permitting, financing and construction of all infrastructure and improvements within the property including utilities, storm drainage, lighting, sidewalks, landscaping, curbs, gutters, and streets for the project. When you are selling prime real estate for so far under market value, it’s because the buyer will assume those costs.

In this deal, the seller’s financial responsibility for infrastructure and improvements is up to $8,000,000, which will be applied as credit to the purchase price for first phase purchase. This means that if the buyer spends $6,700,000 or more on development, the purchase price will be $0.00 for the land. In addition, if the first phase purchase price is less than $8 million, the seller must deposit the remainder of the $8 million in escrow. Therefore, they will owe him $1.3 million, when they close the deal, in either money or additional land.

If the buyer (Mark) defaults during the contract period, the seller’s only remedy will be the original $50,000 deposit and the Port will not automatically get the land back but will have to buy the land back at the price of $5.50 per square foot. That would be a $669,517 profit for the buyer (minus the $50K) if he defaults.

When the recent seat on the Port Commission came up, President of International Longshore and Warehouse Union Local 18 Tim Campbell applied for the position. In addition, President/Owner of Capital Estates LLC, Rick Hart applied to be appointed when the last seat came up. However, the Port CEO fought both diligently. Mayor Martha Guerrero was even willing to step down from the Commission to offer up her seat, knowing that the benefit of having these gentlemen on the Commission would be immeasurable. However, Aaron was strongly encouraging for the council to appoint a city council member for the next seat. Martha was outvoted with a three to two vote and except for County Supervisor Oscar Villegas, all seats on the Commission are now filled with City Council Members.

There are serious questions to be answered. Was this done so that the City Manager would have no resistance when he made deals like this? Did the council members realize what they were agreeing to? How was this presented to them? Why, when there was such a clear call by the public to appoint someone other than a city council member to the Port Commission, did it go unheard?

The question of whether the City of West Sacramento is working towards closing the port is a big and on-going question in the public. The ramifications of such a closure would be huge. Why would the CEO and the Port Commission, both of whom are supposed to be doing what is in the best interest of the port make a deal that clearly has no benefit to the port?

This newspaper welcomes any response from either the City of West Sacramento or the Port Commission to this article and we will gladly publish it for our readers and their right to know.