City makes millions from its old junk

Hoping this year's online auction tops $4 million.

By Sandra Guy - Business Reporter sguy@suntimes.com

City Officials are doing what frantic penny-pinchers have done for years: They're searching every nook and cranny for old fax machines, abandoned SUVs, unsold sports banners and other surplus property to auction online.

Their efforts, per Mayor Rahm Emanuel's do-more-with-less edict, collected $3.6 million in winning bids in 2011 - double the$1.8 million take in 2010. City officials now aim to collect $4.6 million from the online auctions this year by finding even more junk to get rid of.

"We started an aggressive outreach campaign when I said, "If you're not sitting on your chair, I'm going to sell it," said Jamie Rhee, the city's chief procurement officer in charge of the process. "When we can reuse something, we will, but when something is outdated and we can make money off of it, we're going to sell it."

The city hired Public Surplus, a Provo, Utah-based Internet auction company that specializes in government auctions, to conduct the auctions. Public Surplus collects 6.75 percent of the take up to $1 million, after which it collects 6.25 percent. The city held 661 auctions of surplus and abandoned equipment last year.

The most surprising winning bidder was a South American government that wanted old stand-alone fax machines, said Rhee, an 18-year city government veteran who worked as general counsel for the O'Hare Airport modernization program before being named chief of procurement two-and-a-half years ago.

Other winning bids included $20,105 for a 2008 Mercedes Benz SUV; $18,900 for a 2008 Land Rover; and $1,700 for "Walter Payton-Sweetness" Chicago Bears banners. Bidders fought for 330 Xerox copier toners, which sold for $913, and a Black & Decker table saw, which went for $26.