Community & Economic Development Department DISPOSITION OF SUCCESSOR AGENCY OWNED PROPERTY 720 SOUTH B STREET Kymberly Horner, Economic Development Director May 22, 2018
SALE OF SUCCESSOR AGENCY OWNED PROPERTY AB X1 26 (Dissolution Act) was approved by Governor Brown on June 30, 2011, thus ending California s Redevelopment Agencies February 1, 2012, pursuant to AB X1 26, the City of Oxnard elected to serve as the Successor Agency ( SA ) Successor Agencies and Oversight Boards ( OB ) are required to dispose of certain property assets pursuant to AB X1 26 and AB 1484 A Long Range Property Management Plan ( LRPMP ) is required by all SA s to determine how the assets are to be disposed of 1
SALE OF SUCCESSOR AGENCY OWNED PROPERTY On December 31, 2015 the State Department of Finance ( DOF ) Approved of the Oxnard Successor Agency s LRPMP The DOF approved of the disposition and use of all properties listed 720 South B Street is a SA asset listed in the LRPMP in the For Sale category 2
3 SALE OF SUCCESSOR AGENCY OWNED PROPERTY The Oxnard Community Development Commission Successor Agency is currently in possession of an offer to purchase 720 South B Street
720 SOUTH B STREET BACKGROUND 720 South B Street ( Property ) is a 822 square foot building located within Heritage Square Property is a small gabled-roof two story building that is a replica of the original building, commonly referred to as the Maulhardt Winery Building In June 2017, the SA retained the services of Lee & Associates Commercial Real Estate to sell the Property 4
720 SOUTH B STREET BACKGROUND The Broker Opinion Value ( BOV ) of the property by Kosmont Companies identified a value of $70,000 The property was placed on the market in May 2017 Offers were presented to Lee & Associates from: Oxnard Peace Officers Association Juan Carlos Guerrero & Daniel Guerrero Friends of Heritage Square (verbal offer) 5
720 SOUTH B STREET BACKGROUND City Staff requested a Final and Best Offer from all Parties by December 1, 2017 The Final and Best Offer was to include the purchase price with Heritage Square Property Association ( HSPOA ) voting rights deeded to the City and a second Final and a Best with the buyer retaining the Voting Rights. Following slides represents the offers: 6
720 SOUTH B STREET OFFERS Oxnard Peace Officers Association - $185,000 Juan Carlos Guerrero & Daniel Guerrero - $185,000 Friends of Heritage Square - $25,000 (verbal) City of Oxnard - $50,000 Staff was directed to negotiate with the City of Oxnard The City offered to Purchase the building for Public Use 7
720 SOUTH B STREET OFFER TO BE CONSIDERED On January 23, 2018, the City of Oxnard City Council ( City ) and the SA approved an agreement for the City to purchase the Property Agreement authorized a budget appropriation from the General Fund for $76,122: $50,000 for the Property $25,000 for building repairs $1,122 for the property owners assessment 8
720 SOUTH B STREET BACKGROUND On January 29, 2018, staff presented the City/SA Purchase & Sale Agreement to the OB After careful consideration & deliberation, the OB rejected the proposed sale by a vote of 2-4 OB member comments indicated the $50,000 purchase price to be too low considering the $70,000 BOV as referenced on the LRPMP 9
720 SOUTH B STREET RECOMMENDATION Staff recommends the City to negotiate the purchase of the Property for an amount not to exceed $125,000 As a result of the approved prior purchase price $50,000 (General Fund), a budget appropriation for $75,000 is required (Downtown Improvement Project Settlement Funds) 10
BENEFITS OF CITY OWNERSHIP OF PROPERTY Keeps with the City s Economic Development Strategy Priority Goal of Downtown Revitalization City ownership of Property would allow greater public control over how the asset is used in the future Affords additional economic opportunities & tourism for Heritage Square 11
720 SOUTH B STREET ALTERNATIVE RECOMMENDATION That the City decline to submit a revised offer. Staff recommends the Successor Agency direct staff to accept an offer from the December 1, 2017 process; or Staff recommends the Successor Agency direct staff to accept new offers from those that submitted on or before December 1, 2017. 12
13 720 SOUTH B STREET OFFER NEXT STEPS Step 1 Successor Agency Approval Escrow and Due Diligence Period Step 2 Oversight Board Approval Oversight Board Meeting: June 2018 Step 3 State Department of Finance
720 SOUTH B STREET FINANCIAL IMPACT Net proceeds from sale of Property would be either (i) retained by the Successor Agency, reducing on a dollar-for-dollar basis the amount of new funding (RPTTF) to be requested in a successive ROPS period, or (ii) transferred to the Ventura County Auditor-Controller for distribution to the other taxing entities City s General Fund, as a taxing entity, of distribution would be approximately 20% of sale price 14
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