CITY OF ELK GROVE CITY COUNCIL STAFF REPORT AGENDA ITEM NO. 10.1 AGENDA TITLE: Adopt resolution declaring certain Cityowned real properties to be surplus, finding that disposition of the properties by listing with a qualified broker is in the best interest of the City, and directing such listing be conducted in a manner to ensure a competitive bid process for the disposition of real properties MEETING DATE: September 26, 2012 PREPARED BY: DEPARTMENT HEAD: Julie Cline, Real Property Manager Richard Shepard, Public Works Director/City Engineer RECOMMENDED ACTION: Staff recommends the City Council of the City of Elk Grove declare certain City-owned real properties to be surplus, find that disposition of the properties by listing with a qualified broker is in the best interest of the City, and direct staff to so list the real properties, in a manner to ensure a competitive bid process for the disposition of real properties. BACKGROUND INFORMATION: During the course of constructing the Sheldon Road / Highway 99 Interchange Project and the realignment of Bond Road where it intersects Grant Line Road, the City has accumulated a number of remnant properties that are no longer necessary for City use. Five properties have been identified as potential surplus property in the vicinity of the Sheldon Road / Highway 99 Interchange. An additional property is located near the 1
Elk Grove City Council September 26, 2012 Page 2 of 4 intersection of Bond Road and Grant Line Road, which is a remnant from the realignment of that intersection. Under the Surplus Property Land Act, Government Code Section 54200-54232, surplus property is defined as land owned by any agency of the state, or any local agency, that is determined to be no longer necessary for the agency s use, except property being held by the agency for the purpose of exchange. Staff has identified a list of potential surplus real property. The list was created and distributed internally to City management staff to ensure none of the properties are needed for internal City use. The listing of each Cityowned property is shown on Table 1 below and an aerial exhibit depicting each property is attached hereto as Attachment 2. There is no requirement that the City Council formally declare real property as surplus before seeking disposition of the property. However, for the identified properties, for which the City has received no specific interest from a potential buyer, having the Council identify the properties as surplus will provide policy direction to staff and assist City staff in the management of its real property stock. Upon Council declaring the properties surplus, and before the properties are marketed, the City will seek an appraisal for each of the properties to ensure the City receives fair market value. Pursuant to Government Code Section 54222, the City will send a written offer to sell the surplus property to various local agencies. If one of the local agencies desires to purchase the property after having received notice, it must indicate its intent to do so in writing within 60 days of receiving the notice, and the City and the other local agency may negotiate price and terms for the disposition of the property. Staff recommends Council adopt a resolution for the disposition of real property by listing the properties with a qualified broker, in the event the City does not receive a response from an interested local agency. Pursuant to Elk Grove Municipal Code Section 3.42.300(C), the disposition of real property is to be by competitive proposals unless the City Council, by resolution, determines other procedures are in the best interest of the City. In lieu of a traditional competitive bidding, staff recommends listing the properties through a professional broker, which is the functional equivalent to competitive bidding. Staff believes a broker will reach the 2
Elk Grove City Council September 26, 2012 Page 3 of 4 broadest market of potential buyers, including requiring the selected broker to make direct contact with the adjoining property owner in order to provide equal opportunity to all concerned at a fair market price. Staff recommends soliciting a Request for Proposals in order to enter into a contract with a qualified real estate broker and pay a brokers commission as incentive for selling the properties. In an effort to reach a broader market and increase the surplus properties visibility, listing the properties with a real estate broker will increase the chances of providing a qualified buyer who is ready, willing and able to consummate the surplus property purchase. Staff is also evaluating the option of marketing the two properties within the City of Sacramento limits utilizing the City of Sacramento s existing contract with C.B. Richard Ellis. The City of Sacramento and C.B. Richard Ellis are in the early stages of investigating the process of bundling properties and marketing them in a manner that would result in the highest return. Staff recommends the City Council adopt a resolution declaring certain City-owned properties, and any rights, title and interest therein, to be declared surplus, find that disposition of the properties by listing with a qualified broker is in the best interest of the City, and direct staff to so list the real properties, in a manner to ensure a competitive bid process for the disposition of real properties. The subject properties are listed below. Property Address or Location APN Description Acres Zoning 8729 E. Stockton Blvd. 115-0162-011 Vacant Land 1.30 E. Stockton Blvd. just north of Sheldon Road 115-0162-023 Vacant Land.43 8169 Sheldon Rd. 117-0220-020 Vacant Land.59 8165 Sheldon Rd. 117-0220-021 Vacant Land.45 8340 Sheldon Rd. 116-0030-097 Vacant Land 1.12 Intersection of Bond Road and Grant Line Road 127-0120-096 Vacant Land.49 * City of Sacramento Zoning & General Plan RD-20 Residential 20 units per acre RD-20 - Residential 20 units per acre C-2 General Commercial Zone* C-2 General Commercial Zone* AR-5 Agricultural Residential 5 Acre Min. AR-5 Agricultural Residential 5 Acre Min. 3
Elk Grove City Council September 26, 2012 Page 4 of 4 If the Council elects to list the properties for sale, the City will commence with an appraisal of all the surplus lands. The appraised value sets forth the listing price of each individual property and provides the measure for the Council to decide whether to accept or deny a competitive bid or offer to purchase. ENVIRONMENTAL REVIEW: Sales of surplus government property are exempt from the California Environmental Act (CEQA) pursuant to Title 14 Section 15312 of the California Code of Regulations. FISCAL IMPACT: The broker s commission will be paid out of the sale proceeds. Because the purchases of the properties were made with Roadway Fee Fund monies, any revenue generated from the sale of the properties will be credited to the Roadway Fee Fund. There is no impact to the City s General Fund due to this action. ATTACHMENTS: 1. Resolution 2. Aerial Exhibits of City-owned properties 4
ATTACHMENT 1 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ELK GROVE DECLARING CERTAIN CITY-OWNED REAL PROPERTIES TO BE SURPLUS, FINDING THAT DISPOSITION OF THE PROPERTIES BY LISTING WITH A QUALIFIED BROKER IS IN THE BEST INTEREST OF THE CITY, AND DIRECTING SUCH LISTING BE CONDUCTED IN A MANNER TO ENSURE A COMPETITIVE BID PROCESS FOR THE DISPOSITION OF THE REAL PROPERTIES WHEREAS, during the course of constructing the Sheldon Road / Highway 99 Interchange Project, and the realignment of Bond Road where it intersects Grant Line Road, the City has accumulated a number of remnant properties that are no longer necessary for City use. Six (6) properties have been identified as potential surplus property, five of which are in the vicinity of the Sheldon Road / Highway 99 Interchange and one property is located near the intersection of Bond Road and Grant Line Road; and WHEREAS, under the Surplus Property Land Act, Government Code Section 54200-54232, surplus property is defined as land owned by any agency of the state, or any local agency, that is determined to be no longer necessary for the agency s use, except property being held by the agency for the purpose of exchange. ; and WHEREAS, those certain City-owned properties, and any rights, title and interest therein, to be declared surplus for disposition by the City are shown in Table 1 below; and Table 1 City-owned Surplus Properties Property Address or Location APN Description Acres Zoning 8729 E. Stockton Blvd. 115-0162-011 Vacant Land 1.30 E. Stockton Blvd. just north of Sheldon Road 115-0162-023 Vacant Land 0.43 8169 Sheldon Rd. 117-0220-020 Vacant Land 0.59 8165 Sheldon Rd. 117-0220-021 Vacant Land 0.45 8340 Sheldon Rd. 116-0030-097 Vacant Land 1.12 Intersection of Bond Road and Grant Line Road 127-0120-096 Vacant Land 0.49 RD-20 Residential 20 units per acre RD-20 - Residential 20 units per acre C-2 General Commercial Zone* C-2 General Commercial Zone* AR-5 Agricultural Residential 5 Acre Min. AR-5 Agricultural Residential 5 Acre Min. WHEREAS, the City does not anticipate using said real property at any time in the future; and 5
WHEREAS, pursuant to Elk Grove Municipal Code Section 3.42.300(C), the disposition of real property shall be by competitive proposals unless the City Council, by resolution, determines other procedures are in the best interest of the City. In lieu of a traditional competitive bidding, staff recommends listing the properties through a professional broker, which is the functional equivalent to competitive bidding, which staff believes will reach the broadest market of potential buyers and achieve the highest price for the properties. NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Elk Grove hereby declares the above-identified city-owned real properties, and any rights, title and interest therein, surplus, finds that disposition of the properties by listing with a qualified broker is in the best interest of the City for the reasons presented by City staff, and hereby directs staff to so list the real properties, in a manner to ensure a competitive bid process for the disposition of real properties. BE IT FURTHER RESOLVED, that the City Manager is authorized and directed to solicit proposals from qualified real estate brokers for the sale of the property, and to enter into a broker agreement with the broker or brokers who best meets the City needs for the disposition of the property, as determined by the City Manager. PASSED AND ADOPTED by the City Council of the City of Elk Grove this 26 th day of September 2012. JAMES COOPER, MAYOR of the CITY OF ELK GROVE ATTEST: APPROVED AS TO FORM: JASON LINDGREN, CITY CLERK JONATHAN P. HOBBS, CITY ATTORNEY 6
WOOD KAYE K/KAREN DEMANDANTE JANIGA 8627 BOW ST KOCHOO WILLIAM 0 E STOCKTON BL KOCHOO WILLIAM 0 E STOCKTON BL E STOCKTON BLVD Potential Surplus APN SITUS_ADDRESS ZONING GENERAL PLAN ACRES 11501620110000 8729 E STOCKTON BL RD-20 High Density Residential 1.30 LEGEND Potential Surplus Property Neighboring Parcel 0 200 Feet 7
WOOD KAYE K/KAREN DEMANDANTE JANIGA 8627 BOW ST KOCHOO WILLIAM 0 E STOCKTON BL TSAKOPOULOS INVESTMENTS LLC 0 E STOCKTON BL E STOCKTON BLVD Potential Surplus APN SITUS_ADDRESS ZONING GENERAL PLAN ACRES 11501620230000 0 E STOCKTON BL RD-20 High Density Residential 0.43 8 LEGEND Potential Surplus Property Neighboring Parcel 0 200 Feet
TSAKOPOULOS INVESTMENTS LLC 0 SHELDON RD SHELDON RD W STOCKTON BLVD Potential Surplus APN SITUS_ADDRESS ZONING GENERAL PLAN ACRES 11702200200000 8169 SHELDON RD *C-2 *Suburban Center 0.59 *Potential Surplus Property is located within Sacramento City Limits, Zoning and General Plan reflect City of Sacramento information. LEGEND Potential Surplus Property City of Elk Grove Owned Neighboring Parcel 0 200 Feet 9
TSAKOPOULOS INVESTMENTS LLC 0 SHELDON RD SLC SHELDON LLC 8163 SHELDON RD SHELDON RD W STOCKTON BLVD Potential Surplus APN SITUS_ADDRESS ZONING GENERAL PLAN ACRES 11702200210000 8165 SHELDON RD *C-2 *Suburban Center 0.45 *Potential Surplus Property is located within Sacramento City Limits, Zoning and General Plan reflect City of Sacramento information. LEGEND 10 Potential Surplus Property City of Elk Grove Owned Neighboring Parcel 0 200 Feet
E STOCKTON BLVD SHELDON RD JAIN CENTER GREATER SACRAMENTO 8360 SHELDON RD Potential Surplus APN SITUS_ADDRESS ZONING GENERAL PLAN ACRES 11600300970000 8340 SHELDON RD AR-5 Commercial 1.12 LEGEND Potential Surplus Property Neighboring Parcel 0 200 Feet 11
LEONG REVOCABLE TRUST 9180 GRANT LINE RD LEONG PING T/MABEL Y/ETAL 0 GRANT LINE RD BOND RD (Old Bond Rd - To be abandoned) GRANT LINE RD BARBARA J CLAICHE LIVING TRUST/ETAL 9290 GRANT LINE RD Potential Surplus APN SITUS_ADDRESS ZONING GENERAL PLAN ACRES 12701200960000 0 BOND RD SPA-TRI EGTPA 0.49 12 LEGEND Potential Surplus Property Neighboring Parcel 0 200 Feet