TITLE
Recommendation to adopt resolution declaring Successor Agency-owned property located at 101 West Willow Street (APNs: 7206-025-040 through -045) (Subject Property) as "surplus land" as defined in Government Code Section 54220 et seq.; and authorize City Manager, or designee, to take any actions and execute any documents necessary to ensure compliance with the Surplus Land Act and State regulations relating thereto. (District 7)
DISCUSSION
The Successor Agency to the Redevelopment Agency of the City of Long Beach (City) (Successor Agency) is currently fee owner of a parcel located at 101 West Willow Street, Assessor Parcel Numbers 7206-025-040 through -045 (Subject Property) (Attachment A). The Subject Property is approximately 12.41 acres and is improved as Wrigley Marketplace, including a grocery store and various retail and food establishments. The Subject Property is included in the Successor Agency’s Long Range Property Management Plan, which was approved by the State of California Department of Finance on March 10, 2015 and amended on June 24, 2015 (Revised Plan). The Subject Property was originally categorized with a permissible use of “Enforceable Obligation” given it is subject to a ground lease that was signed on January 26, 1998 and has a base period that extends through February 1, 2033. There are also ten sublessee-initiated potential extensions that may keep the lease in place until January 30, 2083. During the approval process for the Revised Plan, the Subject Property was re-categorized with a permissible use of “Sale of Property” at the direction of the State Department of Finance requiring the Subject Property to be sold and proceeds distributed as property tax to the local taxing agencies. Prior to taking any actions to sell the Subject Property, specific requirements must be met to comply with the State Surplus Land Act (SLA).
The SLA, as codified in Government Code Section 54220 et seq., requires all public agencies to prioritize affordable housing as well as parks and open space when disposing of surplus land. Surplus land is land owned by a local agency that is determined to be no longer necessary for the agency's use. Recent changes to the SLA, through Assembly Bill 2135 (AB 2135), (i) revise procedures for disposition by sale or lease of surplus land by local agencies, (ii) extend the good faith negotiation period with potential affordable housing developers to 90 days, (iii) deepen affordability requirements where an affordable housing project is developed on the site, and (iv) add a requirement that if negotiations with an affordable housing developer are unsuccessful, then any residential development on the surplus land over ten units must make at least 15 percent of the units affordable. Further, AB 2135 no longer allows exceptions and requires local agencies to adopt a Resolution declaring property as either “surplus” or “exempt surplus” at a regular public meeting of the agency’s governing body.
The Subject Property does not qualify as exempt under the SLA. The Subject Property is therefore considered to be non-exempt surplus land, as defined by the Government Code Section 54220 et seq. and it is recommended that the City Council, as the legislative body of the Successor Agency, adopt a Resolution making this finding. Upon determination that the Subject Property is non-exempt surplus land, the procedures set forth in the SLA must be followed. Procedures applicable to surplus land require the Successor Agency to issue a written notice of availability of the Subject Property to certain entities, for a period of 60 days, as follows:
• For the purposes of developing low- and moderate-income housing, a written notice of availability of surplus land shall be sent to any “local public entity” as defined in Health and Safety Code Section 50079 within whose jurisdiction the surplus land is located and to “Housing Sponsors” that have notified the California Department of Housing and Community Development (HCD) of their interest in surplus land. Local public entities include the Long Beach Community Investment Company and the Housing Authority of the City of Long Beach.
• For open space purposes, a written notice of availability of surplus land shall be sent to the Los Angeles County Department of Parks and Recreation, Los Angeles County Regional Park and Open Space District, the State Resources Agency or any agency that may succeed to its powers.
• For the purpose of use by a school district for school facilities construction or open space purposes, a written notice of availability of the surplus land shall be sent to the Long Beach Unified School District.
If the Successor Agency receives a letter of interest from any of the above entities, the Successor Agency would enter into concurrent good faith negotiations with all such entities for a period of 90 days. If terms cannot be agreed upon after 90 days (or if no entity gives notice of interest), the Successor Agency may proceed with disposition of the Subject Property. However, any residential development on the Subject Property that contains ten or more units must restrict 15 percent of the units for affordable housing. Any agreement for the sale of the Subject Property would be brought before the City Council, as legislative body to the Successor Agency, as well as the Oversight Board for consideration and submitted to the State Department of Finance for review.
This matter was reviewed by Principal Deputy City Attorney Richard F. Anthony on October 27, 2022 and by Revenue Management Officer Geraldine Alejo on November 7, 2022.
TIMING CONSIDERATIONS
Successor Agency action is requested on December 6, 2022, to allow the Successor Agency to implement actions necessary to comply with the SLA.
FISCAL IMPACT
This recommendation has no staffing impact beyond the normal budgeted scope of duties and is consistent with existing City Council priorities. There is no fiscal or local job impact associated with this recommendation.
SUGGESTED ACTION
Approve recommendation.
Respectfully Submitted,
CHRISTOPHER KOONTZ
ACTING DIRECTOR OF DEVELOPMENT SERVICES
THOMAS B. MODICA
CITY MANAGER