|Published Saturday, May 19, 2001
Want a hardware store? Or golf course? Write an essayRobert Franklin / Star Tribune
For $100, you can buy a small-town hardware store in western Minnesota. Or how about a northern Minnesota golf course for $50?
But there's a catch. First you've got to win an essaycontest.
Yes, the idea of selling property by essaycontest is still around, although perhaps not as strongly as it once was.
Across the country, people have offered houses, bed-and-breakfasts, an inn, a hobby farm and restaurants for sale by essay. Douglas Knight of Minneapolis won a 150-year-old pub in Ireland four years ago in a contest sponsored by the Guinness brewery.
Just write an essay of 500 words or less on your desire to win a hardware store. Or at least 25 words on one of your most memorable golf experiences.
For many, it seems like a win-win situation. Some sellers get more money through thousands of entry fees than they could selling a property outright. A winner may get a debt-free business or other property.
Buyers do have to pay income taxes on the winnings, federal and state officials said. "Of course that would be income," said Leslee Lane Hoyum, spokeswoman for the Minnesota Revenue Department. "Yeah, definitely."
Unsuccessful entrants may spend less than they would on a night of buying pulltabs at a local bar.
Ah, yes, the gambling question.
An essaycontest isn't an illegal lottery if the prize winner is determined on the basis of skill, not chance. But Minnesota's Alcohol and Gambling Enforcement Division doesn't much believe the skill part.
"Generally, we find that essaycontests are illegal because most times they get so many entries [that] unless you have some real structured criteria, unbelievably structured, it's hard to do it all by skill," said Norm Pint, special agent in charge of the division.
"Our concern is that people disguise raffles as essaycontests, and they end up just picking one out of the bunch," he added, and if you ask the sponsors, "they can't even tell you what the criteria is for the winner."
Pint said his staff looks at essaycontests on a case-by-case basis, and he can't say that his division ever has taken any criminal action against a seller. Pint said he has worked with the Itasca County attorney's office, which discouraged the golf-course contest.
A golf course for $50
Mike LaCoursiere, of Bloomington, who is running the $50-an-entry raffle for the 180-acre Wendigo Golf Club property near Grand Rapids, decided to have a Nevada company take over the contest. LaCoursiere said he hopes there will be 34,000 entries by the Aug. 1 deadline.
Meanwhile, the course is in foreclosure. It opened in 1995, but LaCoursiere said it didn't produce the cash flow needed to finish the clubhouse and some other items, and he needs $1.5 million in entry fees to pay off banks and transfer it to a new owner. In addition, the course was hit by some bad weather and big increases in everything from taxes to power bills, he said.
Clair Wilcox, retired owner of Grand Rapids State Bank, agreed that LaCoursiere "didn't have the cash flow" to make the golf course successful. He has until November to work out a deal that would stave off the bank selling the course, Wilcox added. "So they've got to move along."
Wendigo was designed by former Minneapolis Golf Club pro Joel Goldstrand and has been rated eighth in the state in one ranking, LaCoursiere said. The contest put its value at $2.6 million.
The course is being run for the second year by Ruttger's Sugar Lake Lodge under a bank contract, and "it's in beautiful shape, the best it's ever been," LaCoursiere said.
He said contest entries have been "pretty slow," and the deadline originally was supposed to have been this month. At Wendigo, however, pro shop attendant Adam Leistikow said that "we've been getting a lot of calls" about the contest.
At Hoffman, Minn., 20 miles west of Alexandria, Todd and Danni Nelson are seeking 2,500 to 3,500 entries by Aug. 31 for their contest to sell Hoffman Home and Hardware. Others in town will judge the essays, they said.
They bought and combined the town's two hardware stores three years ago when both owners were ready to retire. The Nelsons added a line of clothing. The store was "basically my wife's whole deal," said Todd Nelson, executive director of the town's employment service for developmentally disabled adults.
Then Danni took a job teaching in Alexandria, and Todd said they found that, with four teenaged children, "we are just running ragged." And Nelson said he's an avid golfer.
Although "we had a bad year financially last year," he said, "if we had the debt out of there, the store makes money." The couple would like to get out from under the debt load, free the next owner from the debt and keep a hardware store in town, he said.
Nelson said he was told that typically not many entries come in until near the deadline, but they have been handing out contest rules at the store, and "we've gone through piles of them."
Danni Nelson said the business, with two rented apartments upstairs, is "probably worth $200,000, [but] in a small community, we could never sell it for that. This way, there's no risk for people going in."
Hoffman, a town of nearly 700 people, is in a great area of low crime, good schools, hunting, fishing and quiet living, the Nelsons said. "Everybody who comes in the door you know, and you can talk smart to them," Danni added.
The Nelsons saw an ad for the Wendigo contest and decided to try the same tactic.
For $10 a month apiece, the Nelsons and LaCoursiere are advertising their essaycontests on the Web site http://www.essaycontests.com. Webmaster Mark Samwick, of Wilmington, N.C., said most such contests are not successful because most owners don't put the needed work into publicizing and showing their properties.
Nevertheless, the site continues to list a variety of prizes -- a South Carolina wedding chapel, a Colorado picture-framing business, a Lamborghini auto, vacation packages and a $35,000 kitchen remodeling.
And a space shuttle trip to Mars. But that's not until 2013.
-- Robert Franklin is at email@example.com .© Copyright 2001 Star Tribune. All rights reserved.