Bidders look to lure Colorado Department of Corrections

   The state agency overseeing Colorado prisons has 15 suitors after announcing it was seeking a new home for its central offices and would consider moving from Colorado Springs if the price was right.

   Bids were received by Wednesday's deadline from Cañon City, the University of Colorado at Colorado Springs and more than a dozen developers and real estate companies. The details of the proposals were not released.

   The Colorado Department of Corrections sent out a request for bids in May, saying it had outgrown its 65,000-squarefoot office building in southeast Colorado Springs and was looking for nearly double the office space for its 240 administrative employees.

   In addition to more space, DOC Director Ari Zavaras told prospective bidders the agency expected the sort of incentives that cities have used to entice private companies and nonprofits, such as the recent deal that kept the U.S. Olympic Committee headquarters in Colorado Springs - a break on rent, free furniture and an allowance for building improvements.

   Among the 13 bids submitted by developers and real estate companies are proposals by some of the biggest players locally, including LandCo Equity Partners, which was part of the USOC deal, Norwood Development Group and Corporate Office Properties Trust.

   Mike Kazmierski, president of the Colorado Springs Economic Development Corp., initially said the city wasn't likely to bow to the demand for incentives from another government agency, but that apparently wasn't the final decision.

   A tax break is "up for grabs," he said Thursday, although he declined to elaborate on other perks the city might give a developer to help in keeping the DOC offices in Colorado Springs.

   Rep. Mike Merrifield, D-Colorado Springs, criticized the DOC for what he termed a subtle form of extortion by one tax-supported agency on another, a pay-us-to-stay threat that could set a precedent of public agencies being for sale to the highest bidder.

   "If they're not happy with what (Colorado Springs) has to offer, we'll wave them goodbye," he said. "I don't want to see this become a common practice in public policy. What goes to the highest bidder next?"

   Zavaras declined to comment on anything related to the request for bids or the proposals, but he has the support of Gov. Bill Ritter in seeking the best deal on a new headquarters.

   "Gov. Ritter supports the process DOC Executive Director Zavaras has laid out. It's fair, responsible and prudent," his spokesman Evan Dreyer wrote in an e-mail.

   Jay Fawcett, a former candidate for Congress who now heads think tank Western Strategies Center, disagreed with Ritter.

   "What happens when the sheriff gets a good deal on a piece of land?" he asked. "Do they just pick up and leave too?"

   He said this is a trickle-down effect of similar federal government practices.

   "We finance the government for public good," he said. "So, don't privatize it and tell me it's still a public service."

   Proximity to Interstate 25 and other state highways was one of the preferences the DOC listed for its relocation.

   Last month, the DOC requested proposals from locations in Douglas, El Paso, Pueblo and Fremont counties

   Ken West, president of HW Houston Construction of Pueblo, said he doesn't see his bid as an attempt to steal an employer from Colorado Springs; it's just another construction job.

   "We've got as good of a chance as bidders in Cañon City or Colorado Springs if you want to talk about convenience to the major roads," he said.

   He would not comment on whether Pueblo would assist the company in its bid.

   Rep. Bob Gardner, R-Colorado Springs, initially said he didn't think it was appropriate for one governmental agency to solicit incentives from another.

   "The idea that a city should come forward with taxpayer dollars is over the top," Gardner said Thursday. "That's robbing Peter to pay Paul."

   Later, he said he was confident Colorado Springs would put forward a competitive offer and that the DOC was getting "the most bang out of the taxpayer buck."

   He said the DOC offices were not being auctioned and soliciting incentives was the best route for the DOC because the state is strapped for money.

   UCCS already has an office building the DOC could move into on North Nevada Avenue that is in the area the city is hoping to redevelop.

   The vacant 144,000-square-foot building, formerly known as the TRW building, was sold to the university in 2007 for $2.78 million, well below its appraised value of $8 million.

   The university plans to rent or sell the building for a profit, using the money to pay down debt on a new $54 million science and engineering building under construction on campus.

   The DOC is one of about a half-dozen prospective buyers or tenants for the property, said Chancellor Pamela Shockley-Zalabak, adding UCCS is not receiving incentives from the city to sweeten the deal.

   DOC is expected to pick the finalists on July 2.

BIDDERS

• Canon City
• DC Real Estate LLC - no information available
• Mortenson Construction - Minneapolis-based design and construction firm
• Sierra Commercial Real Estate - Colorado Springs based real estate company
  
• Lazy D LLC - no information available
• HW Houston Construction - Pueblo-based construction and design company
• LandCo Equity Partners - real estate advisor to the U.S. Olympic Committee
• Griffis Blessing - real estate services firm headquartered in Colorado Springs with offices in Denver and Pueblo
• Corp Office Properties Trust - specialty office real estate investment trust with offices in Colorado Springs, Maryland and Northern Virginia
• Front Range Commercial - Colorado Springs real estate brokerage and property management company
  
• SDA Inc - Denver-based real estate development company
• Aardex - no information available
  
• Norwood Development Group - Colorado Springs- based developer of office, retail and commercial space
  
• UCCS - Colorado Springs campus of the University of Colorado
• Colorado Structures - Colorado Springs retail and commercial development company