For: City Council Meeting November 15, 2022
TO: Honorable Mayor and City Council
APPROVAL: Marcus Fuller, City Manager
FROM: Kathy Brann, Economic Development Manager
Title
Request the City Council Adopt Resolution No. 8009 Declaring Its Intention to Sell Surplus Real Property and Calling For Bids For 136 S. Riverside Avenue, Rialto, California, Assessor’s Parcel Number 0130-241-30
Body
BACKGROUND
The City of Rialto (“City”) owns a 3000 square foot parcel located at 136 S. Riverside Avenue (APN 0130-241-30) (the “Property”) improved with a 2400 square foot commercial building, as depicted on Exhibit “A”. The structure is in poor condition and is not suitable in its current state for occupancy. The former Redevelopment Agency of the City of Rialto (“Successor Agency”) had scheduled the improvements to be demolished and the parcel improved as a breezeway/walkway. However, the dissolution of redevelopment occurred prior to commencing the demolition. Subsequently, the City acquired the parcel for governmental purposes in 2015 from the Successor Agency.
On August 9, 2022, the Rialto City Council adopted its Resolution No. 7955, declaring the Property surplus in accordance with the Surplus Land Act, Government Code Section 54220 et seq. (“SLA”). City staff completed the noticing and negotiation periods in accordance with the SLA, and the City received a clearance letter from the California Department of Housing and Community Development, dated October 14, 2022. The parcel was not transferred by the Successor Agency to the City subject to a compensation agreement or any deed restrictions. Accordingly, the City may now dispose of the parcel without Oversight Board review or approval.
DISCUSSION
The attached Resolution calls for bids on the Property and sets December 16, 2022 as the date for conducting an oral bid auction sale of the Property. The sale of the Property shall tentatively be awarded to the highest bidder, subject to the City Council’s final award and approval of a purchase and sale agreement within 45 days of the bid date. The minimum bid is set at $190,000 based on the lower amount of two broker opinions of value with deductions for the poor condition of the interior of the building on the Property. The successful bidders will be required to submit a deposit of 3% of their bid amount at the time they are declared the successful bidder. Within 5 business days of the City Council’s approval of a PSA, the successful bidder is required to deposit with the City an additional 7% of their bid amount for a total deposit amount of 10% of the bid price. The deposit will be applied to the purchase price of the Property at close of escrow. Subsequent to the 60 day due diligence period, if the purchaser fails to complete the purchase, the deposit amount is forfeited to the City as liquidated damages.
ENVIRONMENTAL IMPACT:
The sale of the Property as surplus is exempt from environmental review under the California Environmental Quality Act (“CEQA”) pursuant to CEQA Guidelines Section 15312 (Surplus Government Property Sales).
GENERAL PLAN CONSISTENCY:
This action is consistent with Guiding Principle 3A of the General Plan:
Our City government will lead by example, and will operate in an open, transparent, and responsive manner that meets the needs of the citizens and is a good place to do business.
LEGAL REVIEW:
The City Attorney reviewed and approved this staff report and resolution.
FINANCIAL IMPACT:
Operating Budget Impact
Once the Property is sold the City will realize increased revenue based on the net proceeds of the sale.
Capital Improvement Budget
RECOMMENDATION:
Staff recommends that the City Council adopt the proposed Resolution and proceed with an auction to dispose of the property.