as mike luery shows us, some tenants have been getting free rent for years. >>> reporter: this steel company sits on nearly 500 acres of land in pittsburg, california owned by california taxpayers. the state rented it to to [ indiscernible ] for $235,000 a year until the lease expired in 1994. but after that, the state lands commission, which is supposed to collect the rent, failed to do so for 12 years and the company stayed there on state property at no charge. >> for 12 years without collecting rent on a lease that expired some people would say you guys weren't doing your job. >> i understand that. but again, this was a particularly difficult situation. the lease negotiations very tough. >> reporter: the state lands commission eventually collected just $67,000 in back rents. less than 3% of the money owed. and on this land, owned by taxpayers in martinez, the state lands commission failed to collect rents from an oil pipeline company for six years. instead of collecting $1.4 million in rent, the state lands commission settled the case for just more than a half million dollars, rou

. >> as mike luery of our sacramento sister station found out, many of them are collecting dust on a government auction lot. and the resale will not be pretty. >> reporter: this jet ski and mother half dozen power boats are hid -- more than half dozen power boats are hidden behind a gate checking dust about to be auctioned off, instead of here... on the open water. the state of california paid $271,000 for a total of 32 used watercraft and kept them for only a year. now they are destined for this auction lot. a cbs viewer tipped us off concerned that the government might collect only pennies on the hour. some boaters were also perplexed. >> i have never been a fan of government spending money on stupid things. >> reporter: the government insists they are not doing something stupid but smart policy testing the boats in the laboratory for a full year to measure pollution that escapes when the engines are turned off a big source of smog. the air resource board wants to use the data to create new standards for low emissions vehicles. why not just rent the investigationle or borrow them f

the city wants to take it over but mike luery reports that the owner says that would cost him millions of dollars and the city hundreds of jobs. >> this is the property that's been in my family for more than 40 years and it was originally developed by my father. >> reporter: this rancho cordova property is littered with weeds. sam had a plan to turn this vacant land into a community college. in fact, he even signed the contract three years ago with the los rios community college district. >> it was for over $8 million. and they were going to build a satellite campus here. >> reporter: but the deal fell through. and now the city of rancho cordova is trying to seize control of his property through eminent domain declaring it a blighted area. the city wants to take sam fong's property and sell it to the same people sam fong had a contract with. los rios community college district. >> i had a contract with los rios and they interfered with that contract. and they are taking the property for half of the contract price. >> reporter: that's right. los rios could buy the property for the curre