MEETING DATE:
September 10, 2024
SUBJECT:
Title
RESOLUTION NO. 2024-9345 - DECLARING THAT TRANSFER OF REAL PROPERTY located within the University District Specific Plan Area at 318 E. Barham Drive, San Marcos, CA (Assessor’s Parcel Number 220-202-27-00) TO FACILITATE the construction and installation of public infrastructure improvements IS EXEMPT FROM THE sURPLUS LAND ACT, AUTHORIZING THE CITY ATTORNEY TO SEEK ASSISTANCE FROM THE California Department of Housing and Community DevelopmenT WITH RESPECT TO SUCH EXEMPTION, and authorizing the City Manager and City Attorney to finalize, and execute all documents necessary for the TRANSFER OF real property and improvements AND TO process and implement such transfer in the event said exemption FROM THE SURPLUS LAND ACT is CONFIRMED by the California Department of Housing and Community DEVELOPMENT
Body
Recommendation
Recommendation
ADOPT resolution declaring the proposed transfer of real property and improvements located within the University District Specific Plan Area, addressed as 318 E. Barham Drive, San Marcos, CA (Assessor’s Parcel Number 220-202-27-00) to be exempt from the Surplus Land Act, authorizing the City Attorney to seek assistance from the California Department of Housing and Community Development with respect to such exemption, and authorizing the City Manager and City Attorney to complete negotiations, finalize, and execute all documents necessary for the to facilitate the construction and installation of public infrastructure in the event said exemption from the Surplus Land Act is confirmed by the California Department of Housing and Community Development.
Body
Board or Commission Action
Not Applicable
Relevant Council Strategic Theme
Planning for the Future
Executive Summary
San Marcos adopted the University District Specific Plan (“UDSP”) in 2009 with the goal of creating a vibrant, university-based district with the City of San Marcos. As reflected in the approved UDSP and associated map approvals, acquisition of certain properties or portions thereof is necessary for the installation of required public infrastructure and associated improvements including, but not limited to, the widening of Barham Drive to accommodate multi-modal circulation demand through the widening of travel lanes, the installation of sidewalks for pedestrian circulation, the provision of bike lanes, and the installation of parkway landscaping. The real property and improvements that were previously acquired pursuant to direction from the City Council and are now proposed for consideration to be declared exempt from the Surplus Land Act and subsequently transferred to the master UDSP developer are located within the UDSP at 318 E. Barham Drive, San Marcos, CA, and identified as Assessor’s Parcel Number 220-202-27 (“Property”).
Discussion
As reflected in the aerial view provided with this agenda packet, the subject Property is located at the corner of Barham Drive and Industrial Street and is improved with a single-family residence currently being utilized as an office and an outbuilding formerly used as an industrial/commercial space. Acquisition was previously accomplished following City Council authorization to ensure the cohesiveness of development in conformance with the UDSP, from a seller who did not wish to have any remnant portions of Property returned to him. The Property is proposed to be utilized to widen travel lanes on Barham Drive to accommodate vehicular circulation, to install sidewalks to facilitate pedestrian circulation, provide bike lanes, and to install parkway landscaping. The construction of the described public improvements is not only required pursuant to the UDSP, but also the conditions of approval placed on development entitlements issued to Urban Villages San Marcos, LLC (UVSM). If the Property could not be acquired through negotiation, the City would be in a position of considering the initiation of eminent domain proceedings.
Previously, in similar circumstances with agreements negotiated with property owners within the UDSP, the City Council has approved acquisition of real property needed for improvements, and transfer of the same to UVSM for installation of the same. However, since the date of the last acquisition and transfer to UVSM, the provisions of the Surplus Land Act (Act) and associated California Department of Housing and Community Development (HCD) Guidelines are applicable to proposed transfers of property. Even for transfer of properties determined to be exempt from the provisions of the Act, the Guidelines require that property be acquired by the local agency in fee, and that the agency declare the proposed transaction to be exempt from the Act, before opining with finality as to whether a proposed transfer from the agency is in fact exempt under applicable provisions.
Pursuant to initial direction received from HCD, the City must own the Property in fee simple prior to declaring it surplus or exempt surplus. Said initial guidance stated that “[w]e have completed our review of the draft resolution, pursuant to the [sic] Section 400(e)(2) of the Surplus Land Act (SLA) Guidelines, and have concluded that, if or when the City owns the property in fee simple, the property can comply with and qualify for Government Code Section 54221(f)(1)(B).” That Government Code section relates to a definition of exempt surplus land consisting of less than ½ acre in area which is not contiguous to land owned by a state or local agency that is used for open-space or low- and moderate-income housing purposes.
Accordingly, the City closed escrow on the Property to facilitate the exemption finding. Following such acquisition, the most recent direction from HCD is that the resolution declaring the transaction exempt must be adopted by the City Council before HCD will issue its determination whether the transaction is in fact exempt from the SLA, and it will not opine before such a resolution is adopted.
Accordingly, staff is requesting that the City Council issue its exemption determination by adopting the proposed Resolution, so that said Resolution may be submitted to HCD for its determination on the exemption finding. Such a submission would need to be made to HCD at least 30 days prior to the proposed disposition, pursuant to Section 400(e) of the SLA Guidelines.
Staff recommends that the City Council adopt the exemption finding, and that it authorize the City Manager and City Attorney to negotiate, finalize, and execute associated documents relating to such acquisition provided HCD does issue a determination that the transaction is in fact exempt. A draft of the proposed agreement with Seller is included with the agenda packet.
UVSM was responsible for the deposit and payment of the initial purchase price as well as any and all costs and expenses incurred by the City relating to post-close activities including, but not limited to, this exemption finding. Any risk to the City associated with this transaction has been minimized by UVSM’s agreement to indemnify the City. As a condition of the City’s participation in the described transaction, any and all City costs associated with the same, and each of them, will be borne by UVSM, with UVSM obligated to defend, hold harmless, and indemnify the City against any and all claims of whatever nature may arise from any and/or all of the transactions described herein, which obligation shall survive all potentially applicable limitations periods.
Environmental Review
The proposed action does not have the potential to cause either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment, which has not already been evaluated and addressed in the environmental review documents relating to the University District Specific Plan, and is consistent with said environmental review documents.
Fiscal Impact
There will be no net fiscal impact to the City for this transaction, as UVSM has paid all costs to date associated with the acquisition of the Property, and is responsible for any and all costs associated with the process by which the City will complete its request for an HCD finding that transfer of the Property is exempt from Surplus Land Act requirements, as well as any costs arising from and/or associated with the subsequent transfer of land to UVSM in the event such exemption finding is confirmed by HCD.
Attachment(s)
Site Map/Overhead
Proposed Resolution 2024-9345
Draft Purchase and Sale Agreement
Prepared by: Helen Holmes Peak, City Attorney
Reviewed by: Michelle Bender, City Manager