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HomeMy WebLinkAboutMINUTES - 05252010 - C.16RECOMMENDATION(S): APPROVE and AUTHORIZE the County Administrator to execute on behalf of the County a Memorandum of Understanding (MOU) among the County, the City of Lafayette, and the Lafayette Redevelopment Agency in connection with the sale of real property located at 952 Moraga Road in Lafayette to the Lafayette Redevelopment Agency. FISCAL IMPACT: No impact on General Funds. Costs incurred by the County in connection with the transaction are to be paid from sale proceeds. Sale proceeds in excess of costs will be used for mutually-agreed Lafayette library purposes. BACKGROUND: The County owns real property in Lafayette that, from 1962 to 2009, was the site of the Lafayette library. The County and the City recently opened a new Lafayette library. APPROVE OTHER RECOMMENDATION OF CNTY ADMINISTRATOR RECOMMENDATION OF BOARD COMMITTEE Action of Board On: 05/25/2010 APPROVED AS RECOMMENDED OTHER Clerks Notes: VOTE OF SUPERVISORS AYE:John Gioia, District I Supervisor Gayle B. Uilkema, District II Supervisor Mary N. Piepho, District III Supervisor Susan A. Bonilla, District IV Supervisor Federal D. Glover, District V Supervisor Contact: Anne Cain (925) 646-6423 I hereby certify that this is a true and correct copy of an action taken and entered on the minutes of the Board of Supervisors on the date shown. ATTESTED: May 25, 2010 , County Administrator and Clerk of the Board of Supervisors By: EMY L. SHARP, Deputy cc: County Counsel, Librarian, County Administrator C.16 To:Board of Supervisors From:David Twa, County Administrator Date:May 25, 2010 Contra Costa County Subject:Lafayette Library – MOU Re Property Transfer to Lafayette Redevelopment Agency BACKGROUND: (CONT'D) In 1995, the County and the Lafayette Redevelopment Agency agreed that the Redevelopment Agency could elect to purchase the site of the old library from the County if the sale of the property were completed by June 30, 2011, and the Redevelopment Agency paid a price determined by an established formula. The agreement also stated that proceeds from the sale would be used only for mutually-agreed Lafayette library purposes. The Redevelopment Agency has informed the County that it would like to buy the property. The MOU implements the 1995 agreement by outlining the terms under which the parties may proceed with the sale. The MOU establishes a sale price of $1,690,000, in accordance with the formula agreed to in 1995. If the sale is not concluded by December 23, 2010, the sale price may be adjusted by the formula. The MOU also provides that proceeds from the sale may only be used for: (i) additional hours for the new Lafayette library, above the minimum service levels provided to all libraries by the County, (ii) additional books and other materials to be housed at the new Lafayette library, (iii) servicing, maintaining, and replacing technical equipment at the new Lafayette library, and (iv) other items agreed to by the City Manager and the County Librarian. In addition, the MOU provides that all costs incurred by the County in connection with the transaction will be paid for from the proceeds of the sale. A preliminary title report indicates that there is a cloud on the title that relates to transfer documents recorded in 1939 and 1941. The Redevelopment Agency would like the cloud removed before it buys the property. The MOU states that the County will attempt to clear title but provides that the County may recoup its costs for doing so from the sale proceeds. If the County successfully removes the cloud from title, the County and the Redevelopment Agency intend to enter into a purchase and sale agreement for the sale of the property to the Redevelopment Agency. CONSEQUENCE OF NEGATIVE ACTION: The sale of the property to the Lafayette Redevelopment Agency will be significantly impeded. CHILDREN'S IMPACT STATEMENT: ATTACHMENTS Lafayette Library MOU 1 MEMORANDUM OF UNDERSTANDING This Memorandum of Understanding is dated __________, 2010 and is between the County of Contra Costa (“County”), the Lafayette Redevelopment Agency (“Agency”), and the City of Lafayette (“City”). Recitals A. County is the owner of real property located at 952 Moraga Road, Lafayette, California, which is the former site of the Lafayette branch of the Contra Costa County library (the “Real Property”). City and County recently opened a new library at 3491 Mt. Diablo Boulevard, Lafayette, California (the “New Library”). B. County, Agency and City are parties to an agreement dated January 9, 1996 (the “Settlement Agreement”). As part of the Settlement Agreement, Agency agreed to purchase the Real Property from County on or before June 30, 2011. C. The Settlement Agreement specifies that the purchase price to be paid by Agency will be the fair market value of the Real Property on the date of purchase. The Settlement Agreement further specifies that in no event will the purchase price exceed $1.25 million, increased by a percentage equal to the percentage increase in the CPI (as defined in the Settlement Agreement) (such adjusted amount, the “Cap”). D. The Cap, as of August 2009, is estimated to be $1,845,975. E. The current fair market value, as determined by an appraisal obtained by County in September 2009, is $1,690,000. F. A Preliminary Report from North American Title Company dated June 2, 2009 (the “Title Report”), is attached as Exhibit A. The Title Report lists two exceptions to title that concern Agency and City. Those exceptions are set forth in items 4 and 5 on pages 2 and 3 of the Title Report (the “Exceptions”). G. County is willing to attempt to remove the Exceptions from title on behalf of Agency, subject to the terms and conditions contained herein. Now therefore, for good and valuable consideration, the receipt and adequacy of which are acknowledged, the parties agree as follows: Agreement 1. Essential Terms. During the term of this agreement, County, Agency and City staff will meet and confer to finalize a real property purchase and sale agreement. The essential terms of that agreement will include the following: 2 a. The “Purchase Price” is the amount paid by Agency to purchase the Real Property. In accordance with the Settlement Agreement, the Purchase Price will equal the lesser of (i) the fair market value of the Real Property on the date of purchase, and (ii) the Cap. If Agency’s purchase of the Real Property is completed on or before December 23, 2010, the Purchase Price is $1,690,000. b. Agency will take title subject to exceptions 1, 2, 3, and 6 shown on the Title Report. c. Neither County nor its agents or employees have made any warranty, guarantee or representation concerning any matter or thing affecting or relating to the Real Property, nor does County assume any responsibility for the conformance to the codes or permits of the City or County in which the Real Property is located. If an agreement is reached to transfer title to the Real Property to Agency, Agency will accept the Real Property in an “as is” condition. County makes no representation as to the physical condition of the Real Property. 2. Quiet Title. County will file and litigate a quiet title action for the purpose of removing the Exceptions from title. If the County does not obtain a judgment in quiet title to remove the Exceptions from title, this agreement will be of no further force or effect. 3. Costs. All County costs incurred in connection with transferring the Real Property to Agency, including the cost of litigating the quiet title action, settling the quiet title action, and maintaining the Real Property until title is transferred to Agency, are to be paid by Agency (together, the “Costs”) by payment of the Purchase Price. Notwithstanding the preceding sentence, in no event will the Agency be responsible for Costs in excess of the Purchase Price. 4. Net Proceeds. The “Net Proceeds” from the sale of the Real Property to the Agency will be an amount equal to the Purchase Price paid by the Agency to the County less the Costs. The County shall deposit the Net Proceeds in a “Special Account” within the County’s Library Fund. 5. Use of Proceeds. a. By County. The County’s use of the Net Proceeds is restricted to the following: (i) additional hours for the New Library above the County minimum service levels provided to all libraries in Contra Costa County, (ii) additional books and other materials to be housed at the New Library, and (iii) servicing, maintaining, and replacing technical equipment at the New Library that is used in the County’s operation of the New Library (together, the “Permitted Uses”). Funds in the Special Account may only be used for 3 Permitted Uses, unless another use is agreed to by both the County Librarian and the City Manager. The County Librarian shall meet with the City Manager annually to discuss the projected uses of the Net Proceeds in the upcoming fiscal year. In addition, the County Librarian, or her designee, will provide Agency with at least fourteen days’ prior written notice of County’s use of the Net Proceeds. County shall maintain an accounting of the uses of the Net Proceeds and shall provide a copy of such accounting to the City following receipt of a written request for same from the City. b. By Agency. If Agency sells the Real Property within ten years of its acquisition from County, the Agency’s use of the net proceeds from such sale is restricted to the Permitted Uses. City’s City Manager, or his designee, will provide County with at least fourteen days’ prior written notice of City or Agency’s use of the sale proceeds. City shall maintain an accounting of the sources and uses of the sale proceeds. c. Dispute Resolution. If City or Agency disputes County’s use of the Net Proceeds, or if County disputes City’s or Agency’s use of proceeds from Agency’s subsequent sale of the Real Property, the parties will first attempt to resolve the dispute through informal discussions. If the parties are unable to resolve the matter informally within 30 days after first meeting, either party may submit the matter to a non-binding, structured mediation procedure fashioned by persons or organizations experienced in alternative dispute resolution. The mediation may be requested by any party and must be initiated within 30 days after the date of the request, unless extended by both parties. The alternative dispute resolution procedures used for the mediation will include the exchange of written claims and responses, with supporting information, at least seven days before the mediation. The positions expressed and the mediator’s recommendations are not admissible as evidence in any subsequent legal proceeding. If the matter is submitted to mediation and the matter is not resolved, an affected party may pursue any legal remedy available. If an applicable statute of limitations would run during the pendency of the dispute resolution process described above, the parties may agree in writing to toll the statute of limitations period to complete the dispute resolution process, but no statute of limitations may be tolled for more than 90 calendar days. 6. CEQA. All real property transactions are subject to appropriate review under the California Environmental Quality Act (“CEQA”). County will act as lead agency under CEQA with respect to the transfer of the Real Property to Agency. City has or will act as lead agency under CEQA with respect to the relocation of library services to the New Library. 7. Assignment. This agreement is non-assignable. Nothing in this agreement, express or implied, is intended to confer on any person, other than the parties, any rights or remedies by reason of this agreement. 4 8. Settlement Agreement in Effect. Except as explicitly set forth in this agreement, the terms of the Settlement Agreement are in full force and effect. [Remainder of Page Intentionally Left Blank] 5 9. Modifications. This agreement may not be modified or amended except in a writing signed by the County Administrator, the City Manager, and the Agency’s Executive Director. The parties are signing this agreement as of the date stated in the introductory clause. COUNTY OF CONTRA COSTA CITY OF LAFAYETTE By: _______________________ By: _______________________ David Twa Steven Falk County Administrator City Manager LAFAYETTE REDEVELOPMENT AGENCY By: _______________________ Steven Falk Executive Director APPROVED AS TO FORM: Sharon L. Anderson, County Counsel By: _______________________ Kathleen M. Andrus Deputy County Counsel Malathy Subramanian, City Attorney By: _______________________ Malathy Subramanian