BEND, Ore. (CNN/Money) -
Claudia Johnsen is giving away more than $3 million in property for a song. Or a poem. Or an essay.
"I don't care what it is as long as it isn't anything vulgar," said the 79-year-old Alexandria, Va. resident and sponsor of U.S. Dream Properties, the largest essay contest of its kind.
Anyone with $100 for the entrance fee and 75 creative words has a shot at winning one of five of Johnsen's properties, including a 5,000 square-foot house near Hot Springs, Va. and a $1.7 million plot of land on the Potomac River -- which comes with a 9-carat diamond ring if at least 118,300 essays are submitted for the Potomac property.
|Johnsen's property in Hot Springs, VA can be yours for $100 and 75 words stating why you want it. Appraised value: $575,000.
It's not that Johnsen is hard up for cash. "I'm very comfortable financially," she said, explaining that she plans to give the proceeds to charities benefiting children in Virginia, as well as to her four college-age grandchildren. "I just want to settle my estate before I die."
Johnsen's giveaway isn't the first of its kind. Such contests are completely legal, and are creative alternatives for turning over everything from bed and breakfasts, to Volkswagen Beetles and Mail Boxes, Etc. franchises.
Essay contests enable owners to collect enough money in entrance fees to cover the value of their property while giving participants a shot at winning something for almost nothing.
There's just one problem. Rarely are these contests a success.
A novel idea...
The first high-profile giveaway was in 1993, when Bil & Susie Mosca made headlines by offering their historic inn in Central Lovell, Maine as the grand prize of a 250-word essay contest that cost $100 to enter.
After receiving more than 7,000 essays and returning 2,000 of them, they collected $500,000 and handed over the keys to Janice and Richard Cox of Annapolis, Md.
A decade later the story is still an inspiration.
"I think of a young couple who would spend $100 going to a movie and dinner and hiring a baby sitter. Instead they might stay at home one night, look at television and write an essay," said Johnsen, who pays a staff of ten at DCPages.com to promote and manage her contest, which ends June 26, 2004.
But most property owners don't have an extra $15,000 a month -- what Johnsen says she's spending -- to promote their competitions. And in most cases they can't generate enough interest to make their contests viable.
In fact, last year, after running the inn in Central Lovell for about nine years, Janice and Richard Cox, tried to pass it on in the same fashion it was given to them -- and they too failed.
"For a while I thought people were not entering (essay contests) because of the economy, but then I realized that it's not the money...A lot of people just don't want to sit down and write" said Mark Samwick, who runs the site Essaycontests.com.
"I tell people to consider running an essay contest only if they think they can put their heart and soul behind it," he added.
Mistaken as a scam by some
Though the rules for contests are different in every state, many states simply say that as long as a contest is a game of skill and not chance, it is legitimate. Despite (or because of) this lack of regulation, most sponsors must go out of their way to show that their contests are legitimate.
Like all of the property owners CNN/Money spoke with for this story, Lee and Kevin Greenan hired a lawyer, opened an escrow account and made sure they got the go ahead from the proper state agencies before kicking off their essay contest.
Yet, when they invited the world to pay $250 and write 300 words for the chance to win their $590,000 Seattle house they also invited a lot of criticism. "We got so many nasty e-mails, even threats," said Lee.
On Aug. 31, after extending their deadline by a month, the Greenans canceled the contest because they didn't get nearly enough entries to reach their minimum of 2,500 (2,500 entries times the $250 entry fee would yield $625,000.)
The Greenans returned $230 of the $250 entry fee and used the balance to pay for the $40,000 they spent on legal, administrative and marketing costs.
"I just think there are too many cynical people in the world," said Giulia Wuttke, who organized a 300-words and $150 essay contest for her parents' Woodridge, Ill. home. She too went out of her way to show that the contest was for real. But after receiving only 20 essays – and plenty of hate emails -- the family called off the contest and returned the money.
Taken seriously by others
When Giles and Kami Kolakowski set out to give away their Ice Palace Inn, a bed and breakfast in Leadville, Colo., they too saw their share of cynicism. "We got e-mails that called us bad names and said we were scum for doing this," said Giles.
But they also saw an amazing display of heart and hope.
"It was incredible what people said and how they said it," said Kami of the 150-word, $230 challenge. "One person made a quilt and stitched her essay onto that, and another made a replica of our inn out of sugar cubes with a recipe as her essay." (see a sample submission below.)
"The stories some people told took our breath away," said Giles.
But despite publicity from CNN, Good Morning America, National Public Radio and other news organizations, the Kolakowskis collected only 2,000 of the 2,500 essays they needed, even after extending their deadline.
"It's crushing that after all of that you can't award it to somebody," said Giles, adding that the inn is now for sale. "I just don't think these contests work."
Last week the couple sent out the last of the refunds.
"When we returned the money, one lady said it was the only time in her life she was so disappointed to get a check in the mail," said Kami.
This is just one submission received by Giles and Kami Kolakowski for the Ice Palace Inn.
I've heard that in Leadville...
There's "THE ICE HOUSE PALACE B&B"!
That if we could WIN IT...
It would ALMOST be FREE!
We need a new start...
This comes from within!
I'm entering this contest...
And hope that we WIN!
But that came to an end!
My husband had a Main Artery
That they needed to mend!