REPORT TO THE CITY COUNCIL
FROM: JENNIFER CLARK, Director
Planning and Development Department
PHILIP SKEI, Assistant Director
Planning and Development Department
BY: DANNY TOHME, Housing & Neighborhood Revitalization Manager
Planning and Development Department
SUBJECT
Title
Actions pertaining to the City-owned 10.27 acre property located at the southwest corner of S. Willow Avenue and E. Byrd Avenue (APN: 481-110-42T) (City Council District 5):
1. ***RESOLUTION - Revoking the declaration of Assessor’s Parcel Number (APN) 481-110-42T, as exempt surplus land (Subject to Mayor’s Veto)
2. ***RESOLUTION - Declaring the vacant 10.24-acre of Assessor’s Parcel Number (APN) 481-110-42T to be surplus and directing staff to comply with the Surplus Land Act (Subject to Mayor’s Veto)
Body
RECOMMENDATION
Staff recommends the City Council: 1) Adopt a Resolution revoking the declaration of the 10.27-acre property located at the southwest corner of S. Willow Avenue and E. Byrd Avenue (APN: 481-110-42T), to be exempt surplus land, and 2) Adopt a Resolution declaring the 10.27-acre property located at the southwest corner of S. Willow Avenue and E. Byrd Avenue (APN: 481-110-42T) to be surplus real property.
EXECUTIVE SUMMARY
On September 1, 2022, the City Council declared APN 481-110-42T (Property) exempt surplus land under the provisions of the California Surplus Land Act by Resolution No. 2022-196. City staff have published three separate Requests for Proposals (RFP) since that time and has only received two responses, neither of which were viable to be recommended for disposition. Due to changing development conditions staff has received renewed interest in this property by the development community, but without the additional restrictions required by State of California’s Surplus Land Act exemption. Therefore, staff is recommending that City Council adopt a Resolution revoking the previously adopted Resolution No. 2022-196 declaring this property surplus exempt, and instead adopt a Resolution declaring this property surplus real property and directing staff to dispose of the property pursuant to the Surplus Land Act.
BACKGROUND
On June 30, 2005, the City used $335,000 in program income received from a HUD program closed out in 1999 known as the Rental Rehabilitation Program to purchase the 10.24-acre property from the Fresno Irrigation District for the development of future affordable housing. In 2006 the City released an RFP seeking a developer for the property but received no proposals. Through 2007 and 2008, the City received proposals from two developers, both of which decided against moving forward with their proposed projects. To facilitate sale of the property, the City worked on off-site improvements from 2007 to 2010 and eventually contracted with Cornerstone Structural Engineering Group to widen a portion of the Willow Avenue Bridge which spans over a canal located adjacent to the property. Improvements also included sidewalk, curb and gutter, minor transition paving, and installation of a concrete barrier. Additionally, the City rezoned the property from Exclusive Five Acre Agriculture Urban Growth to Single Family Residential Urban Growth Management.
The Housing and Community Development Division released an internal memo in 2010 offering sale of the property for another City use but did not receive any interest. In early 2016, Habitat for Humanity inquired about the land for donation to a land trust. The request led to an Exclusive Negotiation Agreement with Habitat for the preparation of a Disposition and Development Agreement (DDA) for the property. However, in May 2022, Habitat for Humanity canceled its proposed project at the property. Staff published an RFP in October 2022 for a Community Housing Development Organization in the place of Habitat for Humanity and did not receive any official responses. Staff published another RFP in July 2023 open to all affordable housing developers and received one response but it was not a viable project.
Since the purchase of the property in June 2005, it was the intent of the City’s Housing and Community Development Division to transfer the property to a developer for the development of affordable housing. This decision was made and is part of the City of Fresno 2020-2024 Consolidated Plan (page 134-135) approved by the City Council in May 2020 and thereafter submitted to HUD confirming the use of the property for future affordable housing. In addition, the property was purchased with former/closed U.S. Department of Housing and Urban Development Rental Rehabilitation Program Income and is there further restricted in its use for any other development purpose.
Staff is recommending the adoption of a separate resolution revoking Resolution No. 2022-196, which had previously declared the property (APN 481-110-42T) as exempt surplus land under the Surplus Land Act. The revocation is necessary due to a change in the intended disposition strategy for the property. The City seeks to shift from the previously proposed development strategy and declare the property surplus to allow for broader development opportunities available to the City through the Surplus Land Act (SLA).
The City’s intent to declare the subject property as surplus land in accordance with SLA, in order to initiate the required procedural steps for potential disposition. The property has remained undeveloped for several years despite various planning and outreach efforts, and it is no longer needed for the City’s operational use. Declaring the land as surplus will allow the City to formally notify interested housing entities and comply with state-mandated requirements for future uses.
Surplus Land Act Amendment Highlights
Effective January 1, 2020, the Surplus Land Act (SLA) was amended to include additional requirements that must be followed when disposing of surplus property. The SLA requires that land shall be declared either “surplus land” or “exempt surplus land” supported by written findings before a local agency may take any action to sell or lease land. The primary modifications are summarized below:
• Prohibits negotiating disposition of property prior to compliance with the procedural requirements of the Surplus Land Act (SLA);
• Requires local legislative bodies to take formal action in a regular public meeting to declare land surplus or exempt;
• Prohibits the negotiations between a disposing agency and interested entities from including deal terms that would reduce or disallow residential use of the property;
• Requires disposing agency to send a notice of availability to specified agencies and housing sponsors that have notified the Department of Housing and Community Development of their interest. Agencies have 60 days to respond;
• Requires disposing agency, prior to agreeing to the terms for the disposition of surplus land, to provide specified information about its disposition process to the Department of Housing and Community Development (HCD). HCD then has 30 days to review the information and submit written findings to the disposing agency if HCD determines the proposed land disposal will violate requirements of this new law. Violations would be subject to monetary penalties or enforcement action.
Notice of Availability/Offer to Sell Surplus Property
Pursuant to SLA Section 54222 a Low- and Moderate-Income Housing Availability Notice (NOA)/Offer to Sell Surplus Property will be sent to certain public entities and housing sponsors that have notified HCD of their interest. Local agency conditions or restrictions must be reviewed by HCD; however, an agency may seek the appraised value.
An interested entity must notify the Agency in writing within 60 days after the Agency’s notice. If a timely notice of interest is received from a proper entity a negotiation period of no less than 90 days may begin at the end of the 60-day notice period. The negotiation process is under the purview of HCD. An entity proposing to use the surplus land for developing low- and moderate-income housing shall agree to make available not less than 25 percent of the total number of units to lower income households with applicable covenants. Any proposed disposition and terms would be presented to the Council for consideration and approval.
If the Agency does not agree to price or terms with an entity to which a NOA was given or if no entity responds after the 60-day NOA period, the Agency may proceed with an RFP under the SLA provision that not less than 15 percent of the total number of residential units shall be sold or rented to lower income households with applicable 45 or 55 year covenants.
ENVIRONMENTAL FINDINGS
This is not a project for the purposes of CEQA.
LOCAL PREFERENCE
Adoption of this Resolution to declare real property surplus is not subject to local preference.
FISCAL IMPACT
There is no fiscal impact to the City at this time.
Attachments:
Resolution Revoking Surplus Exempt Declaration
Resolution Declaring Surplus
Location Map