Mar. 27--COLLINSVILLE -- The state has begun auctioning the Collinsville Holiday Inn, taking bids on the troubled property until mid-May.

The Illinois Secretary of State's Office announced Wednesday morning that sealed bids from prospective buyers for the 229-room hotel at 1000 Eastport Plaza Drive in Collinsville are being accepted until 5 p.m. May 13. Real estate auction firm Sheldon Good & Co. will conduct the sale and pre-qualify all bidders before making a formal presentation May 19.

The pending sale brings to a close a 25-year debacle in which a $13.4 million state-backed loan to investors B.C. Gitcho and Gary Fears under former Gov. Jim Thompson's "Build Illinois" program resulted in accrued debt of more than $32 million. Last year, Illinois Treasurer Alexi Giannoulias held a judicial sale to take the title and property from the owners. State treasurer spokesman Scott Burnham said the treasurer doesn't expect to recoup all of the debt owed to the state.

"The sale is important because the state can finally get this mounting debt off its books and end the 25-year ordeal," Burnham said.

He said Sheldon Good & Co. will analyze all bids and conduct background checks on each bidder before informing the treasurer's office about the winner.

State records reveal that after a judge appointed a receiver Jan. 12, 2007, to assume control of management and day-to-day operations at the hotel, the hotel's net profit increased dramatically. The treasurer's office revealed Wednesday that the latest report filed in court by the hotel's receiver, Hostmark Hospitality Group, disclosed that the hotel had earned a profit of $586,000 from January 2007 through November 2007. During that span the year before, the hotel lost $818,000 and resulted in a $1.4 million difference in reported income. During the first six months of last year, net profits were $502,638, compared to $49,060 reported during that same span the year before.

Contact reporter Will Buss at wbuss@bnd.com or 345-7822, ext. 24.

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