To: Board of Supervisors
From: John Kopchik, Director, Conservation and Development
Report Title: Purchase and Sale Agreement - North Broadway Property, Bay Point
☐Recommendation of the County Administrator ☒ Recommendation of Board Committee
RECOMMENDATIONS:
1. OPEN public hearing, RECEIVE testimony, and CLOSE public hearing.
2. ADOPT Resolution No. 2024/___, approving and authorizing the Director of Conservation and Development to execute a Purchase and Sale Agreement between the County and Mike Fernandes (the Developer) for the sale of approximately one acre of vacant County-owned property located at 187, 195, and 199 North Broadway Avenue in the unincorporated area of Bay Point, APN 096-041-001, -013, and -026 (the Property) to the Developer for $452,500, for the development of at least 17 residential units.
3. APPROVE and AUTHORIZE the Director of Conservation and Development Department to execute various legal documents in connection with the sale of the property, including a restrictive covenant, restricting at least 15% of the residential units to lower income households subject to the final approval of the County Administrator and approval as to form by County Counsel.
4. FIND that in accordance with Section 10561(b)(3) of the California Environmental Quality Act (CEQA) Guidelines the sale of the property is exempt from CEQA because it is covered by the commonsense exemption that CEQA only applies to projects which have the potential for causing a significant effect on the environment. Where it can be seen with certainty that there is no possibility that the activity (sale of property) in question may have a significant effect on the environment, the activity is not subject to CEQA.
5. DIRECT staff to file a Notice of Exemption with the County Clerk and pay the filing fee.
FISCAL IMPACT:
There is no impact on the County’s General Fund. The property is a housing asset under Health and Safety Code section 34176 and was acquired using the former Contra Costa County Redevelopment Agency’s tax increment funds. The revenue from the sale will be deposited into the Low- and Moderate-Income Housing Fund (LMIHF).
BACKGROUND:
Recommended Action
Staff recommend approval of the Purchase and Sale Agreement for the sale of approximately one acre of property for the development of 17 - 31 residential units. The sale is in accordance with the Surplus Land Act (SLA). As required by Gov Code section 54222, the Department of Conservation and Development issued a Notice of Availability (NOA) of surplus land in November 2023. No responses were received within the 60-day period following the issuance of the NOA. One response, from Mike Fernandes, was received after the 60-day period. The sale will be for fair market value, which is $452,500, based on an appraisal prepared in November 2021.
The SLA requires that if there is no response to the NOA by an entity to which the NOA was given pursuant to the SLA, and the land is subsequently disposed of and ten or more residential units are constructed on the property, at least 15% of the residential units be restricted to lower income households.
Before closing, the County will need to get the State Department of Housing and Community Development (HCD), the State agency that oversees compliance with the Surplus Land Act, to approve the form of the restrictive covenant recorded against the Property. The request for approval will be submitted to HCD following the Board of Supervisors’ approval of the sale and prior to the close of escrow. HCD has published a sample restrictive covenant and the form of that restrictive covenant is included as Exhibit C to the PSA. A restrictive covenant that is approved by HCD will be signed by the County and recorded prior to the sale (at closing), if the Board approves the recommendations.
CEQA
In accordance with Section 10561 (b)(3) of the California Environmental Quality Act (CEQA) Guidelines, the sale of the Property is exempt from CEQA because it is covered by the commonsense exemption that CEQA applies only to projects which have the potential for causing a significant effect on the environment. Where it can be seen with certainty that there is no possibility that the activity (sale of property) in question may have a significant effect on the environment, the activity is not subject to CEQA.
CONSEQUENCE OF NEGATIVE ACTION:
Failure to approve the Purchase and Sale Agreement will result in delays in the disposition of Housing Successor assets and development of affordable housing.
ATTACHMENTS
Resolution No. 2024/___
33433 Summary Report
Purchase and Sale Agreement and Form of Restrictive Covenant
Public Notice
Notice of Availability of Surplus Property
THE BOARD OF SUPERVISORS OF CONTRA COSTA COUNTY, CALIFORNIA
and for Special Districts, Agencies and Authorities Governed by the Board
IN THE MATTER OF AUTHORIZING EXECUTION OF A PURCHASE AND SALE AGREEMENT SALE OF AN APPROXIMATELY ONE ACRE SITE CONSISTING OF THREE PARCELS IN THE BAY POINT AREA
WHEREAS, the Board of Supervisors (the "Board") of the County of Contra Costa (the "County") adopted the Bay Point Redevelopment Plan by Ordinance No. 87-102 on December 29, 1987, and subsequently amended by Ordinance No. 94-64 on December 6, 1994 and Ordinance No. 99-05 on February 23, 1999, and as amended by Ordinance No.99-54 adopted October 19, 1999, and as further amended by Ordinance No. 2006-33 adopted July 18, 2006, and as further amended by Ordinance No. 2007-23 adopted June 5, 2007, and as further amended by Ordinance No. 2008-19 adopted June 6, 2008, (the "Redevelopment Plan"), which Redevelopment Plan sets forth a plan for redevelopment of the Bay Point Redevelopment Project Area.
WHEREAS, the Contra Costa County Redevelopment Agency (the “Former Agency”) purchased three parcels (APN 096-041-001, -013, and -026) located at 195, 199, and 187 North Broadway, Bay Point (the “Property”) in 2003 using the Former Agency's low and moderate housing fund, which was established pursuant to Health and Safety Code Section 33334.2.
WHEREAS, the County has become the Housing Successor of the Former Redevelopment Agency in accordance with Health and Safety Code Section 34176 and the Property has been identified as a "housing asset" pursuant to Health and Safety Code Section 34176.
WHEREAS, the disposition of real property housing assets is required to be done in accordance with the requirements of the Surplus Land Act.
WHEREAS, as required by Gov Code section 54222, the Department of Conservation and Development issued a Notice of Availability (NOA) on November 14, 2023.
WHEREAS, no responses were received for the Property within the 60-day period following the issuance of the NOA, and one response, from Mike Fernandes, was received after the 60-day period.
WHEREAS, the County desires to accept the offer from Mr. Fernandes at the fair market value of $452,500.
WHEREAS, the Surplus Land Act requires that if there is no response to the NOA by an entity to which the NOA was given pursuant to the SLA, and the land is subsequently disposed of and ten or more residential units are constructed on the property, at least 15% of the residential units must be restricted to lower income households.
WHEREAS the County and Mike Fernandes intend that (i) the Property will be used for the development of multiple-family residential housing at a density of 17-30 units per acre (the "Development"), (ii) a restrictive covenant in conformance with the SLA will be recorded against the Property prior to the sale, and (iii) the Property will be developed in three phases on three separate adjacent sites and that each phase will be the subject of a separate Disposition Development and Loan Agreement.
WHEREAS, the California Department of Housing and Community Development (“HCD”), the agency that oversees compliance with the Surplus Land Act, will review and approve a draft of the restrictive covenant that will be recorded against the Property prior to the sale (at closing).
WHEREAS, the County has established a Low- and Moderate-Income Housing Asset Fund (the "Housing Fund") pursuant to Health and Safety Code Sections 34176 and the revenue from the sale will be deposited into that fund.
WHEREAS, the County has placed on file a copy of the PSA and Summary Report called for in Health and Safety Code Section 33433 (the "33433 Summary Report") and has made the PSA and the 33433 Summary Report available for public inspection and copying pursuant to the 33433 Summary Report.
WHEREAS, the County desires to approve the 33433 Summary Report, which indicates that the net benefit of the sale to the County is $278,616.
WHEREAS, under Government Code §54266, no provision of the Surplus Land Act shall be applied when it conflicts with any other provisions of statutory law.
WHEREAS, the transfer of the Property is subject to the legislated requirements under Health and Safety Code Section 33334.2, 34176.1, 333430, and 33433, which authorize and require the transfer of the Property, a housing asset, for affordable housing and collectively conflict directly with the terms of the Surplus Land Act Government Code §54220 et. seq., as amended by State Assembly Bill 1486.
NOW, THEREFORE, BE IT RESOLVED, that the Board finds that the above recitals are true and correct and have served, together with the 33433 Summary Report and the staff report, as the basis for the findings and approvals set forth below.
BE IT FURTHER RESOLVED that the Board directs County staff to transmit a copy of this Resolution and PSA to HCD for review and approval of the disposition of the Property.
BE IT FURTHER RESOLVED, pursuant to Health and Safety Code Section 33433, that the Board hereby finds that the consideration to be given by the Developer under the PSA is not less than the fair market value of the Property. This finding is based on the facts and analysis set forth in the Section 33433 Summary Report accompanying this Resolution.
BE IT FURTHER RESOLVED, pursuant to Health and Safety Code Section 33433, the Board hereby finds that the conveyance of the Property pursuant to the PSA will assist in the elimination of blight in the Project Area, will provide housing for low-income persons, and is consistent with the implementation plan adopted pursuant to Section 33490 of the Redevelopment Law. These findings are based on the facts and analysis set forth in the Section 33433 Summary and the staff report accompanying this Resolution. Construction of the Development will create attractive, quality, and affordable housing designed to complement the surrounding developed area.
BE IT FURTHER RESOLVED, pursuant to Health and Safety Code Section 33433, the Board hereby approves the PSA and the 33433 Summary Report, in substantially the form on file with the Clerk of the Board, and all ancillary documents; approves execution by the Director, Department of Conservation and Development of the PSA and all ancillary documents in substantially the form on file with the Clerk of the Board of Supervisors, and subject to approval by the County Administrator and approval as to form by County Counsel, in case there are further edits before it is final, and approves the sale of the site as contemplated. These documents may be found at the office of the Department of Conservation and Development at 30 Muir Road, Martinez, CA 94553.
BE IT FURTHER RESOLVED that this Resolution shall take immediate effect from and after its passage.