Article IV — Sale or Lease of City-Owned Real Property for Development

This article is intended to facilitate the City's sale, lease, or disposition of real property for development to promote the economic development, housing, environmental, and community development goals of the City under the procedures set forth in this article. Any sale, lease, or other disposition of City-owned real property that conditions the transaction on the development of the property by the purchaser or tenant shall be governed by this article.

(Ord. No. 13287, § 3, 1-6-2015)

The City Administrator shall have the authority to make the initial determination whether a property should be conveyed for development under this article, or under other disposition provisions in this chapter.

(Ord. No. 13287, § 3, 1-6-2015)

The City shall comply with the Surplus Lands Act (California Government Code Sections 54220, et seq.) if and to the extent applicable to the disposition of the property. Should the property be intended for development as affordable housing, the City shall also comply with California Government Code Sections 37362, et seq., if and to the extent applicable.

(Ord. No. 13287, § 3, 1-6-2015)

A.

The City Administrator shall market the real property by issuing a public and competitive NODO to potential developers and other interested parties. The NODO shall request potential developers and other interested parties to submit written purchase or leasing and development proposals for the property.

B.

Notwithstanding the above, the City Administrator may elect to waive the competitive NODO process and negotiate a disposition transaction with a selected developer, if the City Administrator determines that (1) disposition through a competitive NODO process is impractical, or (2) disposition through a process other than a competitive NODO process is otherwise in the best interests of the City. The City Administrator must explain the basis for any such waiver when he or she presents the proposed disposition to the City Council,

and the City Council shall make findings in support of any waiver of the NODO process as a condition to approving any transaction.

C.

In evaluating development proposals for real property under this article, the City Administrator may consider, without limitation, in addition to price any of the following factors:

The value of the proposed use of the real property to the community and the City as a whole.

The compatibility of the proposed development and use with current zoning and community plans applicable to the real property.

The compatibility of the proposed development and use with the character of the surrounding neighborhood.

The experience, capacity and financial resources of the proposed developer.

The quality of project design.

The environmental sustainability of the proposed development.

Community and public objectives achieved by the proposed development, such as creating jobs, expanding the tax base, providing other fiscal benefits, providing needed commercial or social services, providing or improving needed infrastructure, increasing, improving or preserving the stock of housing affordable to low and moderate income households, eliminating physical or economic blight, and contributing to the economic vitality of the neighborhood.

Other factors, as the City Administrator may deem applicable.

D.

Following his or her evaluation of development proposals, the City Administrator shall make his or her recommendations as to the proposed development and the terms and conditions of one (1) proposed

development to the City Council. The City Council may evaluate the City Administrator's recommended development proposal and any other proposals based on the considerations set forth above.

E.

Per the City Charter, any such approval of a lease (longer than one year) or a sale of the property requites a Council ordinance.

(Ord. No. 13287, § 3, 1-6-2015)

A.

The real property may be disposed of either at its fair market value, fair rental value, or at its fair reuse value, based on the City's assessment of the proposed development and use, prevailing market conditions and development climate at the time of disposition, and other economic and noneconomic factors. The City Administrator shall complete an analysis of the property's fair market value, fair rental value, or fair reuse value, as applicable, in determining an appropriate disposition price.

B.

The ordinance authorizing the disposition of the real property shall include either a finding that the property is being conveyed at its fair market value or fair rental value; or, if the property is being conveyed for less than fair market value or fair rental value, a finding that the property is being conveyed at its fair reuse value with the reasons for the below-market conveyance.

C.

The City shall comply with the procedures set forth in California Government Code Sections 52201, et seq., and California Government Code Sections 53083, et seq., to the extent applicable to the disposition of the real property for development.

D.

If the property is being conveyed at less than fair market value or fair rental value, all City employment and contracting programs pertaining to subsidized projects shall apply.

(Ord. No. 13287, § 3, 1-6-2015)

A.

Any disposition of real property pursuant to this article shall be conditioned on the development and use of the property as negotiated. The City and the purchaser shall enter into a disposition and development agreement, lease disposition or development agreement, or similar agreement governing the transaction. Such agreement shall set forth the terms and conditions of the disposition of the property, the obligations of the purchaser to develop the agreed-upon project, and any long-term restrictions on the use of the property. The agreement may contain covenants or conditions running with the land, and may include rights

of reverter, repurchase rights, termination rights, or other provisions securing the satisfactory performance of development covenants and other purchaser obligations.

B.

The City Administrator is authorized to negotiate and execute agreements and to take whatever other action is necessary with respect to the approved development. The City Attorney shall review and approve all documents and agreements related to the transaction as to form and legality, and a copy shall be placed on file with the City Clerk.

(Ord. No. 13287, § 3, 1-6-2015)