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FINALIZING THE DISPOSITION OF SUCCESSOR AGENCY REAL PROPERTY BY TRANSFERRING HOUSING ASSETS, FUTURE DEVELOPMENT AND GOVERNMENTAL USE PROPERTIES FROM THE SUCCESSOR AGENCY TO THE CITY OF STOCKTON
recommended action
RECOMMENDATION
It is recommended that the Stockton Successor Agency Oversight Board (“Oversight Board”) adopt two resolutions:
1. Approving the filing of Notice of Exemption No. CE017-16 under the California Environmental Quality Act (CEQA) for the disposition of Successor Agency real property;
2. Approving the transfer of housing properties from the Successor Agency to the City of Stockton (“City”);
3. Approving the transfer of certain Successor Agency-owned properties to the City for governmental use or future development; and
4. Authorizing the Executive Director, or his designee, to execute all documents, and take actions necessary and appropriate to carry out the purpose and intent of the resolutions.
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Summary
Upon dissolution of the Redevelopment Agency, properties owned by the former Agency were transferred to the Successor Agency to the former Redevelopment Agency of the City of Stockton (“Successor Agency”). The Successor Agency is not allowed to retain these properties. Therefore, the Successor Agency submitted a housing assets transfer form to the State Department of Finance (“DOF”) requesting approval to transfer housing assets, including real property, from the Successor Agency to the City of Stockton for affordable housing purposes. The housing assets were reviewed by DOF and the transfer of these assets was approved (Attachment A - Housing Assets Approval). Staff requests authority to convey the housing properties from the Successor Agency to the City for affordable housing.
The Successor Agency also submitted a Long Range Property Management Plan (“PMP”) which detailed the proposed disposition of the remaining Successor Agency-owned properties. The Successor Agency designated properties to be sold and those that would be transferred to the City for governmental use or future development. The DOF approved the PMP (Attachment B - PMP Approval). Staff requests authority to convey the government use and future development properties from the Successor Agency to the City.
DISCUSSION
Background
Assembly Bills x1 26 and 1484 (collective the “Dissolution Law”) dissolved all existing California redevelopment agencies and replaced them with Successor Agencies. The City of Stockton, elected to become the Successor Agency, and also elected to take on the housing responsibilities of the former Agency. The Successor Agency became effective on February 1, 2012. On this date, all assets and properties of the former Agency transferred to the Successor Agency. The Successor Agency is not allowed to retain these properties and must sell or transfer them in accordance with Dissolution Law.
Health and Safety Code (“HSC”) Section 34176(a)(2) required the Successor Agency to submit a housing assets transfer form to the DOF for approval. The form listed all of the former Agency’s housing assets and properties that were proposed to be transferred to the City to continue its affordable housing activities. The housing properties include five (5) parcels that were acquired as part of the Gleason Park Apartment project with the intent of being developed as affordable housing. The DOF approved the housing assets for transfer to the City on September 5, 2012. There is no charge to the City for these transfers as they will continue to be used for affordable housing activities. If the properties are not used for an affordable housing project within five (5) years of the date of DOF approval, the properties may be sold, but the funds must be used for affordable housing activities or projects.
To address the remaining properties, the Successor Agency submitted a PMP to the DOF indicating which properties would be sold and which would be transferred to the City for governmental purpose or future development. The PMP addressed the use of fifty (50) parcels divided amongst thirteen (13) sites. The DOF approved the PMP on December 29, 2015.
Six (6) of the sites were approved for sale. The use of any sales proceeds will be used in accordance with Dissolution Law. Net proceeds will be used to pay enforceable obligations of the Successor Agency, and any remaining funds will be disbursed to the local taxing entities.
One site, the Children’s Museum, was approved for transfer to the City as a governmental use property. This transfer will allow the Children’s Museum to continue providing services to the public.
The remaining six (6) sites were approved for transfer to the City to be retained for future development. By retaining these properties, the City will be able to ensure that the projects developed meet the needs, objectives, and goals of the City and the former Agency. The City will work with qualified developers who will acquire and develop the properties in accordance with an approved agreement or Disposition and Development Agreement. The agreement will set the terms of land acquisition between the City and the selected developer.
Present Situation
Housing Assets:
The properties to be transferred to the City for affordable housing purposes are identified below by Assessor’s Parcel Number (“APN”) and address, and are shown on the attached map (Attachment C - Housing Properties Map).
Housing Properties
• APN 149-095-02, 530 East Lafayette Street
• APN 149-095-03, 534 East Lafayette Street
• APN 149-095-04, 311 South American Street
• APN 149-096-18, 548 East Lafayette Street
• APN 149-261-20, 411 South Stanislaus Street
Governmental Use or Future Development
The properties to be transferred to the City for governmental use or future development are identified below by site number and name or description. Several sites are comprised of multiple parcels. A detailed listing of the associated APNs and addresses are included in Exhibit 1 to the resolution. The transfer properties are shown on Attachment D - PMP Transfer Properties Map 1 and Attachment E - PMP Transfer Properties Map 2.
Governmental Use
• Site 2, Children’s Museum (Attachment D)
Future Development
• Site 1, Van Buren, Washington, Market, Madison, and Monroe Streets (Attachment D)
• Site 3, Bob Hope Theatre (Attachment D)
• Site 4, 833 West Weber Avenue (Attachment D)
• Site 5, Lincoln Street and Weber Avenue (Attachment D)
• Site 6, Airport Way and Second Street (Attachment E)
• Site 7, Airport Way and Eighth Street (Attachment E)
The DOF determined that the Bob Hope Theatre could not be transferred as a governmental use property, but could be transferred to the City under the retain for future development category. This option allows the City to retain and continue operating the theatre. In accordance with Health and Safety Code section 34180(f), the City will enter into compensation agreements with the local taxing entities for the properties transferred to the City and held for future development. Terms of the compensation agreements may vary depending on the type of development planned for each of the properties and the economic development incentives that may be used to encourage projects that meet the City’s goals and objectives for the property. Compensation agreements will be developed and executed as plans or projects for the properties are identified.
NOTIFICATION
As required for the disposition of real property, a “Notice of Intention to Transfer Real Property Interest” in accordance with Health and Safety Code Section 34181(f); and the provisions of Article V, Section 510, of the Charter of the City of Stockton was advertised at least ten days prior to the Council meeting in the legal notice section of The Record. The public notice ran on October 6, 2016.
ENVIRONMENTAL CLEARANCE
It has been determined by the Community Development Department that this action/project is exempt from the requirements of the California Environmental Quality Act (CEQA) and is granted a “Categorical Exemption” under Article 19 and, specifically, by Section 15332, Class 32 of the State CEQA Guidelines.
FINANCIAL SUMMARY
There is no charge to the City or the general fund for the transfer of the housing properties. As required, a legal ad was posted at least ten (10) days prior to the transfer request. The cost of the legal ad was split between Low Moderate Income Housing Fund (“LMIHF”) 329-7380-640 and 010-1750-510 for the PMP transfer properties. If the housing properties cannot be used for an affordable housing project within the required timeframe, the properties may be sold. The net proceeds will be deposited into the LMIHF 329-0000-375, and will be used for affordable housing activities.
There are no other charges to the City or the general fund for the transfer of the governmental use or future development properties. Acquisition costs of the future development properties will be paid by the selected developer in accordance with an approved DDA. Net proceeds from the acquisition will be used to pay enforceable obligations of the Successor Agency. Any remaining proceeds will be disbursed to the local taxing entities in accordance with the PMP and Dissolution Law.
Attachment A - Housing Assets Approval
Attachment B - PMP Approval
Attachment C - Housing Properties Map
Attachment D - PMP Transfer Properties Map 1
Attachment E - PMP Transfer Properties Map 2