For City Council Meeting July 28, 2026
TO: Honorable Mayor and City Council
FROM: Tanya Williams, City Manager
AUTHOR: Christina Taylor, Community Development Director
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Request the City Council to: (1) Consider and Approve a Purchase and Sale Agreement with TLC Properties, LLC for the Purchase of Easements for the Location and Maintenance of Existing Billboards on Properties with Assessor’s Parcel Nos. 0132-102-13, 0264-152-54, and 1119-241-28; (2) Consider Terminating Existing Billboard Lease Agreements Related Thereto; (3) Consider Making Findings that this Action is not Subject to CEQA Pursuant to CEQA Guidelines Section 15378(b)(5); and (4) Authorize the City Manager or Their Designee to Finalize Negotiation of and Execute the Purchase and Sale Agreement, Including, but not Limited to, Non-substantive Modifications/Amendments, and All Related Documents Necessary to Effectuate and/or Implement the Agreement on Behalf of the City, Subject to City Attorney’s Approval as to Form.
(ACTION)
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RECOMMENDATION
Staff recommends that the City Council:
1) Approve a Purchase and Sale Agreement with TLC Properties, LLC for the Purchase of Easements for the location and maintenance of existing billboards on properties with Assessor’s Parcel Nos. 0132-102-13, 0264-152-54, and 1119-241-28 in which the TLC Properties, LLC will pay of $3,872,987.00 to the City for such easements;
2) Authorize the City Manager or Their Designee to Finalize Negotiation of and Execute the Purchase and Sale Agreement, including, but not limited to, non-substantive modifications/amendments, and All Related Documents Necessary to effectuate and/or implement the Agreement on behalf of the City, subject to City Attorney’s approval as to form;
3) Authorize the City Manager to terminate Four Existing Billboard Lease Agreements relating to Assessor’s Parcel Nos. 0132-102-13, 0264-152-54, and 1119-241-28 in a manner consistent with the Purchase and Sale Agreement and related documents, subject to City Attorney’s approval as to form; and
4) Determine that this action is not subject to CEQA pursuant to CEQA Guidelines Section 15378(b)(5).
BACKGROUND
The City currently owns (or has property interests in) properties with Assessor’s Parcel Nos. 0132-102-13 and 0264-152-54 (“Properties”) with an existing billboard on each property. The City also currently owns a “Sign Location Easement” and a related “Maintenance, Utility, Access, Visibility, and Overhang Easement” on the real property owned by Travel Center Realty LLC, located at 2325 Sierra Lakes Parkway, San Bernardino, CA 92336 with APN 1119-241-28 (“Travel Center Easement”) with 2 existing billboards located on the Travel Center Easement.
Lamar Central Outdoor, LLC and City previously entered into four (4) leases concerning the placement of advertising billboards on the Property and within the Travel Center Easement (“Billboard Leases”).
As part of the City's ongoing commitment to responsible fiscal stewardship, staff continually evaluates opportunities to strategically monetize underutilized City assets that are not essential to the delivery of municipal services or planned public improvements. Following negotiations, TLC Properties, LLC has offered to purchase easements from the City for the location of the four billboard locations mentioned above. The Purchase and Sale Agreement provides for a purchase price of $3,872,987.
The proposed Purchase and Sale Agreement provides an opportunity for the City to strategically monetize underutilized real property interests associated with four existing billboard locations. Under the agreement, the City will convey two permanent billboard easements over Properties and assign the Travel Center Easement to TLC Properties, LLC, (the easement being assigned is not located on City property) while simultaneously requiring the termination of the City's existing billboard lease agreements with Lamar Central Outdoor, LLC. Under the Purchase and Sale Agreement, TLC Properties, LLC is only acquiring easement interests and not the underlying property.
In exchange, the City will receive $3,872,987 in one-time revenue. The transaction allows the City to realize the current value of these easement interests while transferring future ownership and maintenance responsibilities to the purchaser. The easement documents preserve protections for the City by maintaining restrictions on advertising content, requiring indemnification and insurance, and providing public service advertising opportunities.
ANALYSIS/DISCUSSION
As stated above, the Purchase and Sale Agreement provides for the conveyance of two perpetual easements over City-owned property, assignment of the City's existing Travel Center Easement, termination of Lamar Central Outdoor, LLC’s four existing billboard leases, and payment of $3,872,987 to the City. The easement documents retain important protections including advertising restrictions, indemnification, insurance requirements, and public service advertising opportunities. The transaction converts underutilized City property interests into immediate one-time revenue while eliminating future administrative responsibilities associated with the billboard leases. However, the following major items are still pending:
1. Access easement for the billboard located at Ayala Drive and Renaissance Parkway. Current access to both the billboard and the adjacent City facility appears to run through the Southwest. City staff and TLC Properties are currently working to ensure that they continue to have access. Once this issue is resolved, it will be included in the easement documents.
2. Subordination and Non-Disturbance Agreement. Relating to the billboard located at Ayala Drive and Renaissance Parkway, the title report indicates that there is a Deed of Trust relating to a loan with Lewis-Hillwood Rialto Company, LLC. The purpose of this Subordination and Non-Disturbance Agreement would be to ensure that TLC Properties’ easement would not be affected due to the loan. However, City staff and TLC Properties are working to determine the current status of this loan and whether this agreement is needed. If it is, it will be included as a part of the Purchase and Sale Agreement’s requirements.
3. Existing Permits. The City and TLC Properties, LLC are currently in the process of clarifying the approved permits and the conditions of approval relating to the 4 billboards and whether the Purchase and Sale Agreement (specifically the easement-related documents) will need to account for the permits and any potential mechanisms to address any future City concerns related to their use of the easements.
Because of these pending items, the approval of the Purchase and Sale Agreement includes an authorization for the City Manager to finalize the negotiation of Purchase and Sale Agreement before executing.
ENVIRONMENTAL IMPACT
The proposed action is not a Project under CEQA pursuant to CEQA Guidelines Section 15378(b)(5) because it consists of an organizational and administrative activity that will not result in a direct or indirect physical change in the environment.
GENERAL PLAN CONSISTENCY
The proposed action is consistent with the City's General Plan by promoting sound fiscal management, responsible stewardship of public assets, and long-term financial sustainability.
LEGAL REVIEW
The City Attorney's Office has reviewed the Purchase and Sale Agreement, its attachments, and related documents.
FINANCIAL IMPACT
Operating Budget Impact
The proposed transaction will generate $3,872,987 in one-time revenue through the conveyance of permanent easement rights and assignment of an existing easement. Net proceeds, less customary escrow and closing costs, will be deposited into the appropriate City fund as determined by the Finance Department. No new appropriation is required.
Capital Improvement Budget Impact
There is no impact to the Capital Improvement Budget.
Licensing
This action does not require a business license
ATTACHMENTS
1. Purchase and Sale Agreement