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HomeMy WebLinkAboutOB Reso 03-2017 � City of South San Francisco �° o �-o P.O. Box 711 (City Hall, 400 Grand Avenue) _ South San Francisco,CA Oversight Board L o.g.- Resolution: RES 03-2017 File Number: 17-626 Enactment Number: RES 03-2017 RESOLUTION APPROVING THE RETENTION BY THE CITY OF SOUTH SAN FRANCISCO OF CERTAIN FORMER REDEVELOPMENT AGENCY REAL PROPERTY ASSETS PURSUANT TO THE APPROVED LONG RANGE PROPERTY MANAGEMENT PLAN AND HEALTH AND SAFETY CODE SECTION 34191.5, UPON THE PAYMENT OF SEVEN MILLION ONE HUNDRED EIGHTY THOUSAND DOLLARS ($7,180,000), WITH THE PROCEEDS TO BE DISTRIBUTED TO THE LOCAL TAXING ENTITIES. WHEREAS, on June 29, 2011, the Legislature of the State of California (the"State") adopted Assembly Bill xl 26 ("AB 26"), which amended provisions of the State's Community Redevelopment Law (Health and Safety Code sections 33000 et seq.); and WHEREAS, pursuant to AB 26 and the California Supreme Court decision in California Redevelopment Association, et al. v. Ana Matosantos, et al., which upheld AB 26, the former Redevelopment Agency of the City of South San Francisco was dissolved on February 1, 2012; and WHEREAS, the City of South San Francisco ("City") became the Successor Agency to the Redevelopment Agency of the City of South San Francisco ("Successor Agency"); and WHEREAS, the California Legislature subsequently amended AB 26 by the passage of AB 1484 and AB 107, and these statutes are collectively referred to as the"Dissolution Law"; and WHEREAS, pursuant to Health and Safety Code Section 34191.5(c)(2)(C), property shall not be transferred to a successor agency, city, county or city and county, unless a Long Range Property Management Plan(LRPMP)has been approved by the Oversight Board and the California Department of Finance("DOF"); and WHEREAS, pursuant to the Dissolution Law, the Successor Agency prepared an LRPMP, which was approved by a resolution of the Oversight Board for the Successor Agency to the Redevelopment Agency of the City of South San Francisco("Oversight Board")on May 21, 2015, and was approved by the DOF on October 1, 2015; and WHEREAS,pursuant to the Dissolution Law and the LRPMP,certain real properties located in the City of South San Francisco,that were previously owned by the former Redevelopment Agency, were transferred to the Successor Agency("Agency Properties"); and WHEREAS, the LRPMP establishes a plan for transferring nineteen (19) Agency Properties from the Successor Agency to the City for development consistent with an approved redevelopment plan City of South San Francisco Page 1 File Number: 17-626 Enactment Number: RES 03-2017 (the "Redevelopment Properties") pursuant to Health and Safety Code section 34191.5(c)(2) and in accordance with the requirements set forth in the LRPMP; and WHEREAS,on October 18, 2016,the City of South San Francisco entered into an Amended and Restated Master Agreement for Taxing Entity Compensation("Compensation Agreement") with the various local agencies who receive shares of property tax revenues from the former redevelopment project area ("Taxing Entities"); and WHEREAS,the Compensation Agreement provides that upon approval by the Oversight Board of the sale price, and consistent with the LRPMP, the proceeds from the sale of any of the Agency Properties will be distributed to the Taxing Entities in accordance with their proportionate contributions to the Real Property Tax Trust Fund for the former Redevelopment Agency; and WHEREAS, on February 8, 2017, the City adopted Resolution 16-2017 approving the transfer of the Redevelopment Properties from the Successor Agency to the City and in accordance with the requirements set forth in the LRPMP; and WHEREAS,on February 21,2017,the Oversight Board adopted a resolution approving the transfer of the Redevelopment Properties from the Successor Agency to the City; and WHEREAS, consistent with the LRPMP and the Oversight Board resolution, the Successor Agency and City executed and recorded grant deeds transferring the Redevelopment Properties to the City; and WHEREAS, four(4) of the nineteen (19) Redevelopment Properties, which are commonly known as the former PUC properties, are identified in the LRPMP for redevelopment activities consistent with the Redevelopment Plan and the LRPMP, and more specifically identified in Exhibit A ("PUC Properties"); and WHEREAS,the City, in partnership with the Grand Boulevard Initiative, conducted a market analysis for the site and prepared a development program that would be consistent with the Redevelopment Plan and the El Camino Real Chestnut Area Specific Plan; and WHEREAS, at the time of LRPMP preparation, the City and the consultants determined that a master-developer approach would yield the highest and best uses of the PUC Properties; and WHEREAS,the City is interested in retaining the PUC Properties in order to construct the City's proposed Community Civic Campus Project; and WHEREAS, the City's goal of developing a Community Civic Campus Project on the PUC Properties would achieve the same goals as the master developer approach identified in the LRPMP, which is to, "adopt a strategy most likely to maximize the long-term revenue to the taxing agencies while also maintaining the vision expressed in the former Redevelopment Agency's El Camino Corridor Project Plan,the El Camino Real/Chestnut Avenue Area Plan and the City's General Plan; (LRPMP p. 68)"; and WHEREAS,the LRPMP also contains the following additional statements regarding the objectives City of South San Francisco Page 2 File Number: 17-626 Enactment Number: RES 03-2017 for the PUC Properties: "The City of South San Francisco has identified the intersection of El Camino Real and Chestnut Avenue as a key opportunity site for new development and economic revitalization.The El Camino Real/Chestnut Avenue Area Plan, adopted in 2011, establishes a compelling long-term vision for the area as a new mixed-use neighborhood with residential, retail, and civic uses at a range of densities, along with public plazas and open space that benefit the broader community." (LRPMP, p. 68) "Strategic Economics worked with Successor Agency staff to devise a development program that is both market driven and consistent with the community's goals for the study area as expressed in the El Camino Real/Chestnut Avenue Area Plan and the goals of the El Camino Real Project Plan. The development program assumes redevelopment of all Successor Agency-owned parcels in a manner consistent with a master developer approach. In this approach,the property is redeveloped with the goal of maximizing the combined potential of all of the parcels"...1) economies of scale; 2) more efficient site design; 3) development of all properties. (LRPMP, pp. 71-72) In the event the Successor Agency elected to sell individual properties, Site C is the only site that would be developed consistent with the Agency's El Camino Corridor Project Plan, the El Camino Real/Chestnut Avenue Area Plan and the City's General Plan. Site Al would most likely be purchased by a business that would retain the existing use. Site A2 would not be developed or sold given the site's development constraints and environmental condition. The size and accessibility constraints of Site A3 and Site B would most likely preclude the development and sale of these properties as well. Such outcomes waste a tremendous opportunity to develop hundreds of housing units in a transit oriented area." (LRPMP, pp. 71-72) WHEREAS, the development of the Community Civic Campus Project,which would include a new joint library and recreation center,police station, and other civic uses,would be consistent with the stated goals of the LRPMP and maximize the development of all properties; and WHEREAS, appraisals completed in December 2016 by a qualified commercial real estate appraiser determined that the total fair market value of the PUC Properties based on the highest and best uses contemplated in the LRPMP, after reasonable deductions for environmental cleanup and infrastructure costs, is seven million one hundred eighty thousand dollars ($7,180,000); and WHEREAS, the deduction for an allocable share of infrastructure costs for the planned extension of Oak Avenue is based on projected trip generation from the subject parcels,which is an accepted and reasonable allocation methodology; and WHEREAS, the deduction for environmental cleanup is based on estimates of soil remediation costs for the PUC Properties; and WHEREAS, the City has offered to pay seven million one hundred eighty thousand dollars ($7,180,000) in order to retain the PUC Properties for use as the City's Community Civic Campus Project; and City of South San Francisco Page 3 File Number: 17-626 Enactment Number: RES 03-2017 WHEREAS, the retention of the properties and the implementation of the amended LRPMP through this Resolution itself does not commit the Oversight Board to any action that may have a significant effect on the environment and thus does not constitute a "project" subject to the requirements of the California Environmental Quality Act("CEQA"),pursuant to CEQA Guidelines section 15061(b)(3). NOW, THEREFORE, BE IT RESOLVED that the Oversight Board of the Successor Agency to the Redevelopment Agency of the City of South San Francisco does hereby take the following actions: (1) Finds and determines that the above recitals are true and correct and the proposed actions are consistent with the Long Range Property Management Plan. (2) Subject to the completion of environmental review pursuant to the California Environmental Quality Act (CEQA) and approval of the appropriate environmental document, the Oversight Board approves a purchase price of seven million one hundred eighty thousand dollars ($7,180,000) for the Agency Properties identified in the LRPMP as properties#2,#3,#6,and#7,and as also described in Exhibit A(the "PUC Properties"). (3) Approves the retention by the City of South San Francisco of the Agency Properties identified in the LRPMP as properties #2, #3, #6, and #7, and as also described in Exhibit A. The retention of the PUC Properties by the City is conditioned on the following terms: Pending compliance with CEQA, the City will pay a total purchase price of seven million one hundred eighty thousand dollars ($7,180,000) for the PUC Properties. The sale proceeds will be distributed to the taxing entities according to Section 5 of the Amended and Restated Master Agreement for Taxing Entity Compensation.Nothing in this Resolution shall be deemed to pre-commit the City Council to retaining the PUC Properties until the City Council formally approves the issuance of a Notice of Decision or any other appropriate environmental review required under the CEQA. Pending compliance with CEQA, the City will commit to including the Oak Avenue extension project in the City's Capital Improvement Plan,making reasonable efforts to prepare a full funding plan(including a five million, three hundred and seventy thousand dollars ($5,370,000) set aside) for the total cost of the extension which is estimated at fifteen million five hundred thousand dollars ($15,500,000) in 2017 dollars, and building the project subject to necessary processes and approvals, including environmental review and public discussions. If the final costs for any environmental remediation undertaken by the City on the PUC Properties is less than seven hundred and ninety thousand dollars($790,000),the cost estimate for soil remediation,the City will distribute the difference between the seven hundred and ninety thousand dollar ($790,000) soil remediation estimate and the final remediation costs to the taxing entities according to Section 5 of the Amended and Restated Master Agreement for Taxing Entity Compensation. Prior to the retention of the PUC Properties and the distribution of the net unrestricted City of South San Francisco Page 4 File Number: 17-626 Enactment Number: RES 03-2017 s from the sale price to the taxing entities, the City shall be given the opportunity to obtain a title free and clear of all liens,encumbrances,conditions,covenants, and restrictions that would affect the marketability or value of the Property. This condition may only be waived if the City expressly agrees to acquire title to the property subject to certain exceptions which may appear on the title report. In the event that the City retains the PUC Properties and pays a total purchase price of seven million one hundred eighty thousand dollars($7,180,000),upon distribution of the sale price to the taxing entities,the PUC Properties will no longer be subject to the provisions of the Amended and Restated Master Agreement for Taxing Entity Compensation, and the City will be entitled to retain any future revenue received from any of the PUC Properties.The City will accept the properties subject to any existing leases as of the date of this resolution. (4) Authorizes and directs the City Manager and any designees to execute and record any and all documents, and take all actions necessary to implement this intent of this Resolution, including without limitation the execution of Grant Deeds, Quitclaim Deeds, Certificates of Acceptance, and all other necessary instruments, as applicable, subject to approval as to form by the City Attorney and Oversight Board Counsel. (5) Finds that the adoption of this Resolution itself does not commit the City of South San Francisco or Oversight Board to any action that may have a significant effect on the environment and thus does not constitute a"project" subject to the requirements of the California Environmental Quality Act("CEQA"), pursuant to CEQA Guidelines section 15061(b)(3). At a meeting of the Oversight Board to the Successor Agency to the former Redevelopment Agency on 7/18/2017, a motion was made by Mark Addiego, seconded by Barbara Christensen, that this Resolution be approved.The motion passed. Yes: 4 Krause,Addiego, Christensen, and Friedman No: 2 Cullen, and Scannell Absent: 1 Farrales Attest " Krist. afelli ' City of South San Francisco Page 5 Exhibit A PUC Properties LRPMP Property# Address APN 2 093-312-050 3 Former PUC Properties 093-312-060 6 011-326-030 7 1 Chestnut Avenue 011-322-030