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MSU land deal swept up in debate over biz incentives, farmland preservation

Posted By: The Detroit News on April 26, 2023.  For more information, please click here to read the source article.

Michigan State University is preparing to sell about 1,000 acres of farmland for the assembly of an industrial megasite in a rural area west of Lansing — a potential $21.9 million transaction needed to make the land suitable for a semiconductor or electric vehicle battery plant.

The East Lansing university signed an option agreement with an economic development group in August, giving first choice of sale to a roughly 1,400-acre development effort that’s prompting increased opposition from community members in Clinton County’s Eagle Township just north of Grand Ledge.

Opposition to Michigan State’s sale — based in part on a pre-existing farming contract for the site — is baked into a larger debate over taxpayer-funded megasite incentives that have already secured promises of large battery operations in the Marshall and Big Rapids areas. Lawmakers approved $385 million in taxpayer funds in recent weeks for projects launched by Ford Motor Co. and Gotion Inc.

But the money approvals were made against a backdrop of clashing support and opposition from residents in both communities who were concerned about the use of agricultural land for the projects, the secrecy surrounding the plan and both companies’ ties to China.

In Eagle Township, similar complaints ramped up last year, when the township board agreed to have its supervisor sign a non-disclosure agreement on behalf of the government body to gain information on the site.

Nearly a year later, the property still is being marketed to potential investors even as community members mount an opposition campaign that’s resulted in the filing of recall petitions against two Eagle Township leaders, packed township meetings and an increase of yard signs saying “No Eagle Megasite” dotting properties around Michigan State’s farmland.

The change to the township’s way of life, should it eventually land a company with the magnitude of what’s being sought for the land, would be “incomprehensible” and concerns about those changes should be heard, said Dennis Strahle, a trustee for Eagle Township.

“I’m asking them to be a good neighbor and not go for the highest dollar,” Strahle said of MSU’s planned sale of the land. “This is a life-changing event. It is going to forever alter this township if it comes to be.”

Other township leaders see the sale of the MSU land as inevitable and the township’s responsibility as putting whatever guardrails in place it can for the upcoming development.

“How do you stop a freight train other than to be ahead and put some guidelines and stipulations in place?” Eagle Township Supervisor Patti Schafer said. “You don’t want it to run over you.”

The Lansing Economic Area Partnership, an economic development organization that is helping the state assemble land and attract businesses for the site, stressed there is support for the project.

“This site in Eagle Township in Clinton County is uniquely positioned to attract high-tech investment and bring our supply chain back to the U.S., to bring manufacturing back that has long been outsourced,” LEAP Chief Strategic Officer Victoria Meadows said. “It can bring thousands of local high-skill, high-wage jobs to folks right here in mid-Michigan.”

The future of farmland

The majority of the land comprising the Michigan Manufacturing Innovation Campus in Eagle Township currently belongs to Michigan State University, which signed an option agreement in August to sell the property for the development.

At about $21,500 an acre, the sale would bring in about $21.9 million if MSU were to sell the full 1,018 acres detailed in the option agreement, according to a copy of the deal. The option has not yet been executed by PG&W LLC, a subsidiary incorporated in April 2022 by the Lansing Economic Area Partnership to assemble the land needed for the industrial site.

The offer price per acre is nearly four times higher than the state’s 2022 average farm real estate value, which came in at about $5,850 per acre, according to estimates calculated by the Great Lakes regional office of the USDA’s Ag Statistics Service.

MSU acquired the land under an agreement with farmer and philanthropist David Morris in 2005 that anticipated an eventual sale of the property and stipulated that about 55% of the sale proceeds would go to MSU while the other 45% would head to the Clark Retirement Communities, according to a copy of the memorandum of understanding between Morris and MSU.

Morris, the former Eagle Township supervisor, died in 2009.

There’s been concern voiced in the community over Michigan State’s sale of Morris’ land, which was transferred to the university along with an area farmer’s 25-year crop lease of the property.

Any sale of the land will transfer the lease to the new owners, “who will work in partnership with the leaseholder to determine the future of that arrangement,” MSU spokesman Dan Olsen said.

“Importantly, it was the donor’s intention that the land eventually be sold and that subsequent proceeds MSU received would go toward endowments that invest in the education, research discoveries and outreach programs that strengthen Michigan agriculture,” Olsen said.

Patty Morris Raymond, David Morris’ daughter, said she was surprised last year to learn of MSU’s intent to sell the land. She believed her father would have wanted the university to wait until the expiration of the 25-year lease in 2031 before entertaining offers.

“Once the lease is up, it’s their land,” Raymond said. “They’re going to do what they want with it. But I think they should at least honor the 25 years.”

Jake Clark, who farms corn, soy beans and wheat on the property, said about eight years remain on the lease entered into with Morris, and he’s hoping that it will remain in place under the new owners.

Clark was limited in his remarks on the future of the lease agreement, noting Michigan State University required him to sign a non-disclosure agreement regarding the property. But he was freer with his thoughts on the megasite plans in general.

“As a farmer, you know that land is going to be used for housing and development, but not on a magnitude like this,” Clark said. “And not discussing it with the community is really unsettling for everyone in the community.

“Land is a resource that is overlooked all the time. They don’t make any more of it. And when it’s gone, it’s gone.”

Debate over transparency, support

LEAP officials said they started marketing the Michigan Manufacturing Innovation Campus in October 2022 for a potential development they hope will generate thousands of high-skill, high-wage jobs.

Besides MSU’s land, LEAP is amassing options for additional property in the area, with a total of 1,400 acres for the growing manufacturing campus. The “shovel-ready site” is being positioned to compete for large-scale economic development, including for industries such as semiconductors, electric vehicles and advanced batteries.

There’s currently no development agreement for the property, LEAP’s Meadows said.

“As it stands, we are just looking forward to moving forward with the community to shape something there that meets everyone’s needs,” Meadows said.

The community appears somewhat divided on the issue.

Two recall petitions have been submitted against members of the Eagle Township Board of Trustees: One against Schafer, the supervisor, for signing a non-disclosure agreement and one against Treasurer Kathy Oberg for tabling a discussion at a February meeting on establishing a planning commission to take over duties usually left to the county.

Schafer noted she signed the non-disclosure agreement on behalf of the board and with the board’s approval. Oberg noted the vote was unanimous in favor of tabling a discussion on the planning commission.

Strahle, another Eagle Township trustee, acknowledged that the board voted to allow Schafer to sign the non-disclosure agreement on behalf of the board. That vote in March 2022 marked the first time Strahle had heard of a potential development for that area.

“We trusted what she was telling us was the right thing to do, so we said OK,” Strahle said. But the nondisclosure agreement has proven ineffective in getting additional information on potential suitors for the land, he said, and the reach of the NDA has proven daunting.

During a press conference last week, Meadows called the recall petition “really disappointing”

“We should really be rallying around our leaders who are trying to bring jobs to our community and bring our supply chain back to the United States,” she said. “I sort of see that as an unfortunate distraction from the community process that we’re very eager to be engaged with the community around.”

Eagle Township Trustee Richard Jones said he would oppose a development that would bring in a Chinese-affiliated company, as was the case in the Big Rapids area. But he said, overall, an American manufacturing operation in Eagle Township would be a benefit to the community.

But he acknowledged the issue has created a whirlwind of controversy. In a township that usually draws one or two people to its board meetings, recent gatherings have drawn packed crowds, and last Thursday’s meeting focused on the development lasted at least four hours.

“I think there’s a lot of people who are mountain climbing molehills,” said Jones, noting no company has made an offer for the site. “They’re very heated about not wanting any involvement with it.”

The township can’t stop progress, nor can it stop a private land owner like MSU from selling for an eventual development, Schafer said. But she hopes the township will have a seat at the table to ensure the land is protected from contamination if such a development comes to pass.

“If everybody thinks that we’re not all scared, then they’re crazy,” Schafer said. “We’ve never had anything like this before. But MSU does have property rights. You just can’t stop something like this, in my opinion.”