Lowe v. City of Hot Springs

Summary

The South Dakota Supreme Court held that the City of Hot Springs's agreement with Pete Lien & Sons, Inc. was a bona fide lease of municipal real property rather than a contract for the procurement of services. Accordingly, the service-procurement requirements of SDCL chapter 5-18A did not apply, and the City was required only to comply with the municipal-property leasing procedures in SDCL 9-12-5.1 and 9-12-5.2. The court affirmed summary judgment for the City and Pete Lien.

Holdings

1. The agreement was not a contract for the procurement of services. It was a bona fide lease of municipal real property, even though the lease included conditions requiring Lien to undertake certain efforts related to farming, biosolids disposal, and land exchange or payment.
2. The City complied with SDCL 9-12-5.1 and SDCL 9-12-5.2 by adopting a resolution of intent, setting a public hearing, publishing notice more than ten days before the hearing, and authorizing the lease by majority vote.
3. Summary judgment for the City and Pete Lien was proper because the statutory service-procurement requirements did not apply to the bona fide lease and the City complied with the applicable municipal-lease procedures.

Questions Presented

1. Whether the City's RFP and resulting agreement with Pete Lien & Sons constituted procurement of services governed by SDCL chapter 5-18A.
2. Whether the agreement was instead a bona fide lease of municipal real property governed by SDCL 9-12-5.1 and SDCL 9-12-5.2.
3. Whether summary judgment for the City and Pete Lien was proper.

Disposition

affirmed