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Home My WebLink About6.3 Sale Surplus Real Prop CITY CLERK File # D~[2[Q]-[8]~ AGENDA STATEMENT CITY COUNCIL MEETING DATE: April 17, 2007 SUBJECT: PUBLIC HEARING: Amendment of Dublin Municipal Code Chapter 2.38 Relating to the Sale of Surplus Real Property Report Prepared by Elizabeth H Silver, City Attorney Melissa Morton, Director of Public Works, Leah Peachey, Associate Attorney ATTACHMENTS: 1) Ordinance Amending Chapter 2.38 of the Dublin Municipal Code Relating to the Sale of Surplus Real Property RECOMMENDATION: /I VI) A{/V'U 2) 3) 4) 5) Receive Staff presentation; Open public hearing; Receive public testimony; Close public hearing and deliberate; Waive the reading and INTRODUCE the Ordinance Amending Chapter 2.38 of the Dublin Municipal Code Relating to the Sale of Surplus Real Property (Attachment 1). FINANCIAL STATEMENT: None. DESCRIPTION: The existing Dublin Municipal Code (DMC) Chapter 2.38 relating to the sale of surplus real property sets forth the procedures relating to determination and sale of surplus real property within the City of Dublin ("City"). As part of the comprehensive update to the DMC, Staff has reviewed Chapter 2.38 and proposes revisions for purposes of clarification and to ensure compliance with state law (Attachment 1; the "Surplus Real Property Ordinance"). . City's Authority to Regulate Procedures for Sale of Surplus Real Property Pursuant to California Government Code Section 37350, a city may adopt reasonable regulations for the disposal of real property for the common benefit. This procedure applies to the sale or disposal of City- owned land ownership either in total or through granting an easement. These situations do not occur frequently because most City-owned property is held for public purposes (i.e. streets, parks, etc.). However, it is important to have updated procedures in the DMC to address any situations which arise. COPY TO: Page 1 of3 ITEM NO. M StfRpt Sale of Surplus Property--final.DOC; 114.1015 (Y The City's existing regulations provide a procedure for the determination of whether property is surplus, including an annual departmental evaluation of real property owned or controlled by the City that is no longer used by the City and is in excess of the needs ofthe City. Upon finding that the property is not required for any other use, the City Manager shall report to the City Council, which has the authority to declare the property surplus. Prior to the disposal ofthe property, the City Manager must meet certain notice requirements set forth at Government Code Section 54220 et seq., which provides that prior to the disposal of the property, the City shall make a written offer to sell or lease the property to certain public agencies, such as regional park authorities and local agencies certified to provide affordable housing. The City's existing regulations provide a procedure for the sale of surplus property, in the event that none of the public agencies wishes to purchase or lease the property. For surplus real property with an estimated market value ofless than $5,000, the City Manager may dispose ofthe property administratively, without Council approval. The existing regulations prov.ide the City Manager with authority to negotiate to sell the property to an adjoining property owner if the City's property is not a buildable parcel by itself, or to negotiate a sale with an adjoining property owner if the combination of the City's property and the adjoining property would provide improved development potential, subject to Council approval of the final agreement of sale for properties with an estimated market value of $5,000 or more. For surplus real property with an estimated market value of $5,000 or more, the City Manager shall conduct a public notice and bid process to determine the highest responsible bidder. Upon such determination, the City Manager shall obtain City Council approval 'Of the final agreement of sale. Finally, the regulations provide that incidental fees such as escrow fees and commissions shall be paid by the purchaser. Staff proposes the following minor amendments to the Surplus Real Property Ordinance. Proposed Amendments to Surplus Real Property Ordinance The proposed Surplus Real Property Ordinance will make the following amendments: Conformance with the General Plan The proposed Surplus Real Property Ordinance would add a requirement imposed by state law to provide that the Planning Commission shall review the disposition of the surplus real property for conformance with the City's General Plan and issue a report confirming such conformity. (See Government Code Section 65402.) City Council Approval of the Agreement of Sale The existing ordinance provides that the City Council shall have approval over the final agreement of sale of the property in various sections of the ordinance. (See Sections 2.38.030.B and 2.38.060.) However, the proposed Surplus Real Property Ordinance clarifies this requirement by incorporating it into the section providing the procedure for sale of the property. (See Section 2.38.050.F.) Determination of Buildable Property ~~J The proposed Surplus Real Property Ordinance clarifies that the Director of Community Development shall make the determination of whether a parcel of surplus real property is buildable and whether development potential would be improved in combination with an adjoining lot, for purposes of negotiation by the City Manager. (See Sections 2.38.030.B and 2.38.030.C.) City Manager Negotiation Authority The proposed Surplus Real Property Ordinance would clarify the existing negotiation authority of the City Manager to negotiate a sale with adjacent property owners where: 1) the parcel is not a buildable parcel itself under the current zoning, or 2) the development potential of the parcel would be improved in combination with the adjoining parcel(s). (See Section 2.38.030.D.) In these situations, the City Manager need not satisfy the bidding requirements set forth in Section 2.38.050; provided, however, that the City Manager must obtain the approval of the City Council for the final agreement of sale. Finally, the proposed Surplus Real Property Ordinance amends various provisions of the chapter for purposes of improved organization. RECOMMENDATION: Staff recommends that the City Council: 1) Receive Staff presentation; 2) Open public hearing; 3) Receive public testimony; 4) Close public hearing and deliberate; 5) Waive the reading and INTRODUCE the Ordinance Amending Chapter 2.38 of the Dublin Municipal Code Relating to the Sale of Surplus Real Property (Attachment 1). .J~ J l~' ORDINANCE NO. AN ORDINANCE OF THE CITY OF DUBLIN AMENDING CHAPTER 2.38 OF THE DUBLIN MUNICIPAL CODE RELATING TO THE SALE OF SURPLUS REAL PROPERTY RECITALS WHEREAS, pursuant to California Government Code Section 37350, the City of Dublin ("City") may adopt reasonable regulations for the disposal of real property for the common benefit; and WHEREAS, the City of Dublin Municipal Code Chapter 2.38 provides regulations and procedures for the determination and sale of surplus real property within the City; and WHEREAS, the City Council desires to amend these regulations to clarify the regulations and ensure that the regulations conform to current law. NOW, THEREFORE, the City Council ofthe City of Dublin does hereby ordain as follows: Section 1. Chapter 2.38 ofthe Dublin Municipal Code is revised as follows, with deletions indicated in strikethrough and additions indicated in underline: 2.38.010 Applicability. The procedures set forth in this chapter shall be applicable to the disposal of real property owned by the Ceity of Dublin and determined to be surplus and excess property no longer necessary for public purposes. The provisions of these rules this chapter shall not apply to the abandonment of streets or the vacation of easements owned by the Ceity of Dublin and governed by the statutes of the state of California, nor shall the pro'lisions of these rules apply to the termination, rejection or abandonment of offers ef of dedication pursuant to Section 66477.2 ofthe Government Code. or the purchase of real property bv a public agency pursuant to Section 54220 et seq. ofthe Government Code. 2.38.020 Determination of surplus property. A. On or before December 31 of each year. A~ll departments within the Ceity of Dublin shall submit to the City Manager a report showing any real property in the possession, custody or control of such department that is no longer used and is otherwise surplus and excess for the needs of the department in compliance with Section 50569 of the Government Code. If the City Manager finds that such real property is not required for any other public use, he or she shall so report to the City Council and the City Council may declare it surplus. authorize a public sale of the property. and cause to be prepared a Page 1 of6 4/11 (Q7_ I1e.m#~' 3 ATTACHMENT 1 2.~t. written estimate of its market value. B. Prior to disposal of surplus real property by public sale,~ L. The Planning Commission shall review the disposition of the surplus real property for conformance with the City's General Plan and issue a report confirming such conformity pursuant to Section 65402 of the Government Code: and 2. Ithe City Manager shall provide notice to public agencies in the manner prescribed by Section 54220 et seq. of the Government Code. In the event that no public agency wishes to sell or lease the property pursuant to Section 54220 et seq. of the Government Code. the property shall be disl'osed of pursuant to the provisions of this chapter. C. The following procedures apply if the property is not purchased by a public agency pursuant to Section 54330 54220 at seq. of the Go',ernment Code. 2.38.030 Manner of disposal. A. The City Manager may dispose of any surplus real property whieh that has an estimated market value ofless than five thousand dollars ($5,000) without ad,.'ertising for bids complying with Section 2.38.050. B. If the surplus real property has an estimated market value of five thousand dollars ($5,000) or more, the City Manager shall dispose ofthe property in the manner set forth herein and shall require City Council approval for final agreement of sale in Section 2.38.050. C. If the parcel whieh that is surplus real property is an uneconomic remnant such that it is not ~ buildable parcel by itself under the current zoning, as determined by the Director of Community Development. then the City Manager may negotiate a sale price with the adjoining property owner(s) without advertising for bids complying with Section 2.38.050: provided. however. that the City Manager shall obtain City Council approval for the final agreement of sale. I* If the parcel whieh that is surplus real property is a buildable parcel under the current zoning, and the combining ofthe parcel to an adjacent parcel would provide better development from a planning perspective than development ofthe surplus property by itself, as determined by the Director of Community Development. then the City Manager may negotiate a sale with the adjoining property owner(s) without complying with Section 2.38.050: provided. however. that the City Manager shall obtain City Council approval for the final agreement of sale. If an acceptable price (to the City) is not reached, thon the City shall dispose of the property in tho manner set forth herein. 2.38.040 City personnel prohibited. Page 2 of6 3~' No Ceity official, officer or employee shall bid, or be financially interested in any bid for surplus real property sold in accordance with these rules this chapter. 2.38.050 Sale procedure. The conveyance of surplus real property by the Ceity shall be by quitclaim of all right, title and interest in said property held by the Ceity of Dublin to the highest responsible bidder who submits a responsive bid pursuant to the following procedures: A. A notice inviting bids shall be published at least once ten (10) days before the opening of the bids in a newspaper of general circulation in the Ceity printed and published within the Ceounty of }.Jameda. Notice inviting bids shall include a legal description of the subject property, a vicinity map showing the general location ofthe subject property, the time and place of opening of bids, specifications for bids, and a statement that transfer of the surplus real property shall be by quitclaim deed. B. Sealed bids, including a ten percent (10%) bid deposit, shall be submitted to the City Clerk. Said bid deposit shall be in the form of cash, cashier's check, certified check, or bidder's bond executed by an authorized surety company. C. At the time and place fixed in the notice to bidders, all sealed proposals which have been received shall be publicly opened, examined and declared by the City Clerk. Of the proposals submitted which conform to all terms and conditions of sale, the proposal which is the highest shall be accepted unless a higher oral bid is accepted, or the City Manager rejects all bids. D. In his or her sole discretion, the City Manager may set a minimum acceptable bid amount and may reject any and all bids presented. E. After opening bids the City Clerk shall call for oral bids from those bidders tendering written proposals. If, upon the call for oral bidding, any responsible person offers to purchase the property, upon the terms and conditions specified and for a price exceeding by at least five percent (5%) of the highest written proposal, and thereafter by successively higher bids by at least five percent (5%) of the highest written proposal, then the responsible oral bid which is the highest shall be accepted. Final acceptance by the City Manager shall not be made, however, until the oral bid is reduced to writing and signed by the offerer and an additional cash deposit (in cash, cashier's check or certified check) in the amount often percent (10%) of the bid over the offerer's original bid is tendered. This reduction of the bid to writing with signature and cash deposit shall be completed within twenty-four (24) hours after determination ofthe highest bidder has been declared by the City Manager, or the offerer shall forfeit his or her bid deposit. F. Upon determination of the highest bidder pursuant to Section 2.38.050.E. the City Manager shall obtain City Council approval for the final agreement of sale and authorization to execute a Quitclaim deed on behalf of the City.Unless otherwise specifiod in the notico to bidders, sale of surplus property shall be made f{)r cash, cashier's check or certified eheck. Page 3 of6 *~~ G. The successful bidder shall pay the balance of the purchase price plus all incidental and ancillary costs within fourteen (14) days of acceptable of the bid City Council approval of the final agreement of sale, unless an extension is agreed to by the Ceity. Failure to submit the balance and all such costs within fourteen (14) days (or as may be extended) shall result in forfeiture of the bidder's deposit. Unless otherwise specified in the notice to bidders. sale of surplus property shall be made for cash. cashier's check or certified check. H. All bidder's deposits shall be retained until the quitclaim deed is recorded and shall then be returned, except as provided in subsection G of this section. 2.38.060 Deed-Additional costs. Upon rocei-pt of the amount of the highest bid and City Council appro'lal, the City Manager shall e:xecute a quitclaim deod on behalf of the city for the real property. All incidental and ancillary costs, including but not limited to escrow fees, commissions, title and recording fees shall be borne exclusively by the purchaser. 2.38.070 Funds. The amount received for any property sold pursuant to these rules this chapter shall be credited to the appropriate fund as the City Manager may determine. 2.38.080 Effect on validity. Nothing in these rules this chapter shall affect the validity of any transfer of title to real property. 2.38.090 Forms. The following form for notice to bidders and resolution accepting bids may be used: CITY OF DUBLIN STATE OF CALIFORNIA NOTICE TO BIDDERS OF SALE OF SURPLUS PROPERTY 1. The City of Dublin has determined that the real property described in Exhibit A which is attached hereto is surplus and no longer necessary for public purposes. Said real property is generally located at (DESCRIPTION OF PROPERTY). 2. The City of Dublin desires to sell the herein described property to the highest responsible bidder by quitclaim deed. The City makes no representations regarding this property, including but not limited to its size, zoning, utility service or accessibility. or presence of hazardous materials. While the subject property was acquired in fee by the City of Dublin in connection with (DESCRIPTION OF PROJECT), the City of Dublin makes no warranties express or implied with regard to title of this property Page 4 of6 ~ c::t ; 3. Sealed bids, subject to the conditions named herein, addressed to the City of Dublin will be received at the office of the City Clerk up to 2:00 p.m. (DATE BIDS DUE), at which time they will be publicly opened and read. The right is reserved as the interests of the City may require, to reject any and all bids, to waive any informality in bids, and to accept or reject any items of any bid. 4. The City further reserves the right to accept oral bids at the time the bids are publicly opened and read from responsible bidders who have submitted written bids exceeding by at least five percent (5%) of the highest written bid. 5. All incidental or ancillary fees associated with the transfer ofthis property by quitclaim deed, including but not limited to title insurance, escrow fees, commission, notaries, recording fees and the like shall be borne exclusively by the purchaser without recourse to the City. 6. A Bid Deposit shall be placed in an envelope attached to the outside ofthe sealed proposal. The Bid Deposit shall be in one of the following forms: cash. cashier's check, certified check, or bidder's bond executed by an authorized corporate surety. The Bid Deposit Checks or bonds shall be in an amount equal to at least ten percent (10%) of the total amount ofthe bid. Section 2. Severability. The provisions of this Ordinance are severable and if any provision, clause, sentence, word or part thereof is held illegal, invalid, unconstitutional, or inapplicable to any person or circumstances, such illegality, invalidity, unconstitutionality, or inapplicability shall not affect or impair any of the remaining provisions, clauses, sentences, sections, words or parts thereof of the ordinance or their applicability to other persons or circumstances. Section 3. Effective Date. This Ordinance shall take effect and be enforced thirty (30) days following its adoption. Section 4. Posting. The City Clerk ofthe City of Dublin shall cause this Ordinance to be posted in at least three (3) public places in the City of Dublin in accordance with Section 36933 of the Government Code of the State of California. PASSED, APPROVED AND ADOPTED this day of , 2007. AYES: NOES: ABSENT: Page 5 of6 ABSTAIN: ATTEST: Fawn Holman, City Clerk 942263_4; 114.1015 Page 60f6 ~'~, Janet Lockhart, 11ayor