STAFF REPORT - CITY COUNCIL/SUCCESSOR AGENCY/PUBLIC FINANCE AUTHORITY

Under the Dissolution Act, the City is required to dispose of real property it received as housing assets from the former Redevelopment Agency. Based on updated to the Surplus Land Act, staff is recommending to initiate this by commencing a surplus property disposition process as described herein. 

Under the Surplus Land Act and HCD's implementing guidelines, public agencies are now obligated to first make properties that are not under contract available as surplus properties before entertaining other offers. Pursuant to Surplus Land Act, public agencies must first designate the properties as surplus property, then provide notice of their availability to specified nonprofit housing providers and certain other entitities before engaging in negotiations to dispose of the properties with any other entity. The City Council, acting as the Housing Successor Agency ("Housing Successor"), may approve this resolution. 

The City of Coalinga ("City") is the Housing Successor to the former Coalinga Redevelopment Agency ("Agency"). As part of the completion of the statewide redevelopment dissolution process in 2012, the Agency transferred three real properties to the Housing Successor on the HAT, including Property (3), or APN 071-162-16ST ("Property"). The 3.77 acre property is a vacant residential parcel located on Locus Avenue. Under state law, the City has until December of 2022 to redevelop or dispose of the Property received from the former Agency. The City has now determined that the Property is of no further use and requested RSG staff to prepare the necessary documentation for disposition by the end of the year. 

The Property currently has interest from potential buyers but under the state's Surplus Land Act, public agencies are now obligated to first make properties that are not under contract available as surplus properties before entertaining other offers. The process for surplus property disposition entails these main actions: 

1. Under the Act, once the surplus designation is made, a notice of availability is prepared and transmitted to housing sponsors and other parties as required by law. 
2. Those entities have (60) days to notify the City that they are interested in the property by providing a notice of intent. 
3. Thereafter, the City must negotiate in good faith with any qualifying entity expressing interest in the property.
4. If the City and the qualifying entity cannot come to an agreement within the ninety (90) days of the commencement of negotiations, or no qualifying entity expresses interest in the property during the sixty (60) days notice period, the City is able to market and sell the property to any entity. 
5. The City is not required to sell the property to a qualifying entity for less than fair market value, but is required to negotiate with qualifying entities in "good faith". Among other things, the City is prohibited from negotiating with a potential buyer, other than a qualifying entity, until the ninety (90) day period has ended. In short, the City could enter into an agreement within the 90 day period, or wait until the 90 days period lapses before proceeding with negotiations with another buyer. 

The tentative disposition schedule is detailed below.

April 21, 2022 - Declare APN 071-162-16ST as Surplus Property 

April 28, 2022 - Distribute Notice of Availability

June 27, 2022 - Notice of Intent Due from Qualifying Entities 

September 26, 2022 - Good Faith Negotiation Period Ends