The City Manager recommends approval of Resolution No. SA-330 approving a Purchase and Sale Agreement (“PSA”) between the Successor Agency to the Redevelopment Agency of the City of Coalinga (“Successor Agency”), as seller, and Walid Saif Muharram (“Purchaser”), as buyer, for disposition of 163 East Elm Avenue (“Property”), Property No. 17 of the Successor Agency’s Long Range Property Management Plan (“LRPMP”).
As a result of the dissolution of redevelopment, the Successor Agency was created to administer enforceable obligations and wind down the affairs of the former Redevelopment Agency of the City of Coalinga (“Former Agency”). As part of that process, the Successor Agency must dispose of all non-housing properties of the Former Agency in an expeditious manner aimed at maximizing value, pursuant to the requirements of the Dissolution Law and in particular in compliance with the LRPMP approved by the State of California, Department of Finance (“DOF”) on December 30, 2015. Should the Successor Agency approve the PSA, it will be submitted to the Fresno County Consolidated Oversight Board for final review and approval.
The Successor Agency is performing its functions under the Dissolution Law to administer the enforceable obligations and otherwise wind-down the Former Agency's affairs. Under the Dissolution Law, a successor agency’s actions are subject to review by a seven-member oversight board. Until June 30, 2018, each successor agency had a local oversight board that served this purpose. As of July 1, 2018, local oversight boards were replaced by consolidated countywide oversight boards as part of the streamlining and wind-down of redevelopment affairs. For the Successor Agency, its new oversight board is referred to as the Fresno County Consolidated Oversight Board and consists of seven members representing various public agencies in Fresno County. The Fresno County Consolidated Oversight Board reviews and takes action on Successor Agency action items under the Dissolution Law, including the approval of this Purchase and Sale Agreement.
The Former Agency acquired the Property in 1988 and held ownership until dissolution in 2012, when the Property was transferred by operation of law to the Successor Agency. The LRPMP calls for the sale of the Property (Property 17 in the LRPMP), as well as ten other properties, along with the transfer of 11 properties to the City of Coalinga (“City”) for governmental use. The Property is approximately 0.51 acres of vacant land, zoned as Central Trading District C-4 in the City’s Zoning Ordinance.
DOF’s role in the review of a purchase and sale agreement under an approved LRPMP was amended in 2015 by Senate Bill 107, effective that October. Under the Dissolution Law Section 34191.5(f), actions to implement the disposition of property pursuant to an approved long-range property management plan shall not require review by the DOF. If the Fresno County Consolidated Oversight Board approves the PSA, then that will be the final action to proceed with implementation of the sale under the PSA.
The Purchaser desires to acquire the Property, which is currently vacant and provides no revenue for the City. Per the Dissolution Law, the Successor Agency must either submit the net proceeds of the sale to the County Auditor-Controller for distribution to the affected taxing entities, including the City of Coalinga, or spend the proceeds on recognized enforceable obligations. Under the terms of the PSA, the Purchaser will acquire the Property from the Successor Agency for $100,000 cash.
Under Section 3A of the PSA, within three (3) business days after the Purchaser has received a copy of the PSA and accepted the terms and executed the PSA, the Purchaser is to deposit $1,000 into escrow. Per an addendum to the PSA, the Purchasers intends to pay all cash. The deposit shall be applied to the purchase price. In the event the escrow is terminated, the deposit is refunded to the party entitled to the funds. If the Successor Agency receives any funds from a canceled escrow, such proceeds would be available for and restricted to enforceable obligations on a future ROPS.
Do not approve Resolution No. SA-330.
V. FISCAL IMPACT:
Net proceeds of the sale of this property will be submitted to the County Auditor-Controller for distribution to the affected taxing entities, including the City of Coalinga.