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HomeMy WebLinkAboutReso 94-142 - Adopting a policy regarding disposition of City-Owned Real Property RESOLUTION NO. 94- 111Z— A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF REDDING ADOPTING A POLICY REGARDING DISPOSITION OF CITY-OWNED REAL PROPERTY. WHEREAS, the City Council of the City of Redding is charged with the responsibility of establishing municipal policies to guide the various functions of the City and, where necessary, to establish procedures by which functions are performed; and ` WHEREAS, regulatory policies established by the City Council are usually adopted by Ordinance and included in the Municipal Code. However, other policies are also established, which by their nature do not require adoption by Ordinance; these policy statements, adopted by Resolution of the City Council, need to be consolidated in a reference document for easy access; and WHEREAS, on August 4, 1987, by Resolution No. 87-261, the City Council adopted a Council Policy Manual to achieve said objectives; and WHEREAS, the City Council wishes to adopt a policy regarding the disposition of City-owned real property; NOW, THEREFORE, IT IS HEREBY RESOLVED by the City Council of the City of Redding that the attached policy, to be incorporated in the Council Policy, be and hereby is adopted as the Council' s policy on the disposition of City-owned real property. I HEREBY CERTIFY that the foregoing Resolution was introduced, read, and adopted at a regular meeting of the City Council of the City of Redding on the 17th day of MaY , 1994, by the following vote: AYES: COUNCIL MEMBERS: P. Anderson, Kehoe, McGeorge, Murray, and R. Anderson NOES: COUNCIL MEMBERS: None ABSENT: COUNCIL MEMBERS: None ABSTAIN: COUNCIL MEMBERS: None R ERT C. ANDERSON, Mayor City of Redding A ST: FORM APPROVED: CONNIE STROHMAYER, ' ty Clerk RANDALL A. HAYS, City Attorney CITY OF REDDING, CALIFORNIA COUNCIL POLICY SUBJECT RESOLUTION POLICY EFFECTIVE NUMBER NUMBER DATE PAGE DISPOSITION OF CITY-OWNED REAL PROPERTY 94-142 1901 5-17-94 1 of 13 BACKGROUND The City of Redding is the owner of real property which is used for various municipal purposes. As public service needs change, the requirements for these properties may be revised, and on occasion, certain parcels may be found to be in excess of the City's current need. This requires that the site be reviewed in terms of its potential for future public use as well as its potential economic benefit to the City. PURPOSE It is the purpose of this policy to: (1) establish a procedure whereby unused or marginally used City-owned real estate is reviewed for its potential public use and for designating unneeded parcels for lease or sale; (2) provide guidance for the auction, negotiated sale, or exchange of City-owned real estate; and (3) establish the conditions under which City-owned real property may be leased. POLICY It is the City's policy to manage its real estate assets so that municipal needs which rely on these assets may be properly implemented. It is not the City's policy to speculate in real estate. The City Council will review all City-owned real estate not adequately used for municipal purposes and determine the appropriate use of the property. Those properties needed for municipal purposes may be so designated. If a property is not needed for public use within the foreseeable future, it may be made available for lease or sale; or if it will be needed at a future time, it may be suitable for lease in the interim. Those properties not required for municipal use or are designated for lease may be designated for sale or reserved to be exchanged for other land the City needs. The City shall optimize the sale price or lease rent from City-owned real estate based on relevant factors including: (1) an appraisal of the property which is no more than 12 months o/d at the time the sales agreement is presented to the City Council, (2) prevailing economic conditions and recent applicable trends, and (3) any special benefits to accrue from the sale or lease. Discounts will not be negotiated unless an extraordinary need or circumstance is recognized by City Council resolution prior to negotiation, setting forth the amount of the discount and the justification for it. The purpose of this is to demonstrate to the community that the City is not making a gift of public assets. Since it is generally not in the City's best interest for a property transaction to be negotiated in open session, pursuant to Section 54956.8 of the Government Code, the City Council may discuss either approval, disapproval, or continuation for further negotiation or study any recommendation regarding the disposition of City property in closed session. Any final action, however, shall occur in open session and shall disclose the revenue from any sale or lease and the appraised value of the property involved. CITY OF REDDING, CALIFORNIA COUNCIL POLICY SUBJECT RESOLUTION POLICY EFFECTIVE NUMBER NUMBER DATE PAGE DISPOSITION OF CITY-OWNED REAL PROPERTY 94-142 1901 5-17-94 2 of 13 PROCEDURE A. Real Estate Review All unused and marginally used City-owned real estate will be reviewed on a continuing basis to determine public facility needs and to implement the General Plan on a timely basis. The following procedure shall apply: 1 . Review by appropriate City departments and other utilities. 2. Review by any applicable City commission. 3. Review by the Planning Commission for consistency with the General Plan and environmental impact. 4. The staff's recommendation and relevant comments are submitted to the City Council. 5. The City Council then determines the designation to be applied to the property, i.e., public facility, open space, surplus, sale, or lease. 6. Referral as required to other agencies prior to soliciting offers. Genera/Plan and Rezoning. Prior to marketing a parcel, staff shall review the parcel for likely changes in density or intensity of use since the City acquired the property. If such changes are likely, then staff shall initiate a necessary rezoning and General Plan amendment through the Planning Commission to market the property at its highest and best use. When projects are divided by different land-use classifications, staff shall seek lot splits, lot mergers, or property-line adjustments to divide the property along use lines, to reserve rights-of-way for streets and utilities, and to be able to disclose the terms of development of the property. B. Referral to Other Agencies Before selling any surplus property, the City must comply with Government Code 54220 et seq. and shall offer to sell surplus land to parks and recreation agencies or to local housing authorities. The City shall only refer property to the agencies if the property is usable and the General Plan and zoning would allow the property to be used for residential purposes. C. Lease Versus Sale City-owned real property not required for municipal uses may be designated for lease or sale using criteria listed below. At the time staff recommends whether the property should be sold, leased, or reserved for exchange purposes, Council shall be provided with an appropriate analysis of the alternatives. 1 . Criteria for Sales. Property may be sold when: a. The property is unleasable because of location, access, topography, or other considerations. CITY OF REDDING, CALIFORNIA COUNCIL POLICY SUBJECT RESOLUTION POLICY EFFECTIVE NUMBER NUMBER DATE PAGE DISPOSITION OF CITY-OWNED REAL PROPERTY 94-142 1901 5-17-94 3 of 13 b. The sale would maximize the total economic return to the City. 2. Criteria for Lease. Property shall be leased when: a. The land can only be leased because of legal restraints such as grant restrictions, airports, dedicated parks, agricultural preserves, open space, watershed,floodplains, etc. b. The property is now needed or may be needed in the future to provide the City with a site for public facilities or unusual services not otherwise obtainable or obtainable later at greater cost. c. The property is in an area of uncertain future development and can be leased as an interim measure until future public needs or land-use designations can be determined. d. The City requires substantial control over development, use, and reuse of the property. 3. Industrial Properties. Generally, City-owned industrial and airport properties will be used to facilitate increased employment and otherwise enhance the local economy. The sale of such properties may be linked to job generation. The lease of land at the Municipal Airport will be in accordance with Council Policy 301 —Airport Development Policies. D. Sale of Real Estate 1 . Auction. Unless otherwise directed by the City Council, land which is readily marketable and unrestricted in its sale potential will be sold to highest bidder at public auction either by oral or sealed bid provided that the highest bid equals or exceeds the minimum unpublished price established by the City prior to bid opening, which price shall not be lower than the amount shown on the appraisal. Notice of the sale by bid shall be published in a newspaper of general circulation at least ten days prior to bid opening. If sealed bids are requested, each bid must be accompanied by a deposit in the form of certified or cashier's check made payable to the City in an amount equal to at least 10 percent of the bid amount. After sealed bids are opened, oral bids are permitted from bidders who can meet the 10 percent deposit requirement. The initial oral bid must be at least 5 percent higher than highest sealed bid. Subsequent oral bids must be in increments of not less than $100.00. If the person whose bid is accepted fails to pay the total bid price within 60 days from acceptance of bid, the bidder's deposit is forfeited, and at the sole option of this City, property may be offered for sale to the next highest bidder on the same terms as granted the high bidder. The Council shall be notified of bids received or, if applicable, the fact that no bids had been received. The Council may reject any and all bids. The minimum acceptable bid will usually be the appraised fair market value as determined by an independent Member of Appraisal Institute (MAI) appraiser. The intent of this procedure is to efficiently set a minimum bid which will ensure a fair return to the City for its property, while encouraging maximum participation in the bidding process. CITY OF REDDING, CALIFORNIA COUNCIL POLICY SUBJECT RESOLUTION POLICY EFFECTIVE NUMBER NUMBER DATE PAGE DISPOSITION OF CITY-OWNED REAL PROPERTY 94-142 1901 5-17-94 4 of 13 2. Negotiated Sales If no bids are received or no bids are deemed acceptable to the City Council, the City may seek to sell land by one of the following: a. Marketing - Competitive offers for lease or sale may be solicited from the open market place. This may be accomplished through a number of marketing techniques such as requests for proposals (RFPs), a marketing subscription system, direct advertising, exposure through real estate services, posting the property, and any other appropriate means. Lands designated for industrial and airport uses at the Municipal Airport shall be marketed in accordance with Council Policy 301 . b. Direct marketing- by seeking to sell the property through direct contacts under the following circumstances: (1) When the land is not readily marketable because of its odd shape or lack of sufficient area to meet minimum space requirements for building in the particular zone in which it is located or which is landlocked or otherwise lacking in sales potential may be sold by taking offers or by negotiation with adjoining landowners provided the purchase price agreed upon is within 10 percent of the appraisal or the land is exchanged for public improvements of equal or greater value that would otherwise be the obligation of the City. (2) When the sale to a contiguous owner would correct a site deficiency or improve access to the other property in a manner desired by the City. (3) When a fee interest in public right-of-way is no longer required, it may be sold to a contiguous owner or exchanged for public improvements of equal or greater value. A restrictive easement of adequate width or other required easements may be reserved from said sale. (4) When other governmental, public, and quasi-public agencies submit proposals to acquire City property, the City shall consider such requests prior to making the land available to the general public. Such sales shall be at fair market value, unless the Council finds that selling at a lesser value is in the City's interest. Selling land at less than the appraised fair market value shall require a four-fifths vote of the City Council to do so. (5) When qualified, nonprofit institutional organizations offer to purchase City-owned land, a negotiated sale may be consummated at fair market value providing there is (1) a development commitment and (2) a right to repurchase or a reversion upon a condition subsequent. Nonprofit and institutional organizations are required to develop under the City's conditional use permit procedure. CITY OF REDDING, CALIFORNIA COUNCIL POLICY SUBJECT RESOLUTION POLICY EFFECTIVE NUMBER NUMBER DATE PAGE DISPOSITION OF CITY-OWNED REAL PROPERTY 94-142 1901 5-17-94 5 of 13 (6) When a property has been offered by public auction and no acceptable bids have been received, it may be sold on a negotiated basis to any applicant submitting an acceptable offer within six months following the date of auction. After 12 months, any offer must be based on an updated appraisal. (7) Real property exchanges may be consummated by direct negotiation; however, exchanges will be considered only when there is an advantage to the City, when it results in land needed for a public purpose, or to further the goals and objectives of the City's General Plan. E. Easements. Where the City or other governmental agency has paid for easements, rights-of-way, or access rights and requests to vacate such interests are received and approved, the City shall receive the current fair market value or equivalent compensation for the removal of the restriction. Easements may be exchanged for other easements or relocated to other locations without compensation. F. Exchanges When land is exchanged, it shall be done on the basis of the fair market value of each property as determined by an MAI appraisal. Any difference in value shall be made up by the party with the lower appraisal value. G. Payment for City Surplus Property Sales of real property shall be on an all cash basis with the following exceptions: 1 . Upon written recommendation and approval by the Council, a parcel of surplus real property may be sold on such credit terms as are deemed to be necessary in each case. After the required down payment has been made,the balance of the purchase price shall be secured by a note and deed of trust. The credit payment period shall not exceed five years from the date of execution of the trust deed. Interest shall be at the prevailing rate in the community, and the use of term payments shall be linked to job generation for the sale of commercial or industrial property. 2. Sales to nonprofits performing a public purpose may be in the form of a loan or residual receipts note at less than the prevailing interest rates and for more than five years provided the note is tied to affordable housing. H. Leasing 1 . Rate of Return. Except for the areas listed below,the City shall obtain a fair market rate of return on City-owned property being considered for lease and negotiate terms and conditions which will continue to sustain a fair rate of return through rent review, consumer price index adjustments, reappraisals, or the application of percentage rents to gross income. The rate of return shall be based upon the highest rate commensurate with the highest and best use of the property or a fair rate of return commensurate with the designated public use. Rental rates shall be established by the City Council based on a current appraisal, comparative studies, or past rents received. • CITY OF REDDING, CALIFORNIA COUNCIL POLICY SUBJECT RESOLUTION POLICY EFFECTIVE NUMBER NUMBER DATE PAGE DISPOSITION OF CITY-OWNED REAL PROPERTY 94-142 1901 5-17-94 6 of 13 a. Nonprofit Office Park. Land and buildings in the Nonprofit Office Park will be leased at a rate sufficient to provide for the upkeep and maintenance of the property, administrative costs, and the replacement of equipment or facilities at the end of their useful life. b. Construction Sites. City land temporarily used for construction purposes by other agencies shall be leased based on prevailing rates for that practice. c. Grazing Lands. The use of City land for grazing purposes shall be at a rate sufficient to cover any administrative or maintenance costs associated with the lease. d. Airport Properties. Land or space at the airports shall be leased in accordance with policies applicable to those properties. e. City land leased for recreation open to the general public without a fee shall be leased at a rate sufficient to provide for administrative and maintenance costs. 2. Renta/ Terms. Rental terms may be negotiated on the basis of fixed rates, deposits, percentages of gross income, or combinations thereof—whichever is commensurate with the market place. 3. Minimum Rent. Both percentage and flat-rate leases will provide a minimum rent which shall be adjusted at appropriate intervals based on escalation clauses, CPI adjustments, or appraisals, which shall be no more than every five years to reflect 80 percent of the average annual rent actually paid during the preceding interval. In no event shall the adjusted minimum rent be less than the minimum rent in existence preceding the adjustment nor less than that amount necessary to maintain the premises. The initial rent shall be based on current market conditions. 4. Long-Term Lease. A lease in excess of one (1) year requires Council approval. 5. Short-Term Lease. Unless there are special circumstances, a lease term of less than one (1) year may be executed by the City Manager without Council approval. A short-term lease may not be renewed without Council approval. Council will be notified of a short-term lease not later than 15 days following its execution. 6. Selection of Lessee. Lease proposals shall be evaluated in terms of: a. Consideration offered in the form of rent. b. Financial capability. c. Expertise regarding the proposed leasehold development and operation. d. Nature of proposed development. e. Special public benefits to be derived (if any). f. Consistency of the intended use with the General Plan and zoning. CITY OF REDDING, CALIFORNIA COUNCIL POLICY SUBJECT RESOLUTION POLICY EFFECTIVE NUMBER NUMBER DATE PAGE DISPOSITION OF CITY-OWNED REAL PROPERTY 94-142 1901 5-17-94 7 of 13 7. Leasehold Assignments. Requests for assignment of leasehold interest shall be evaluated on the same basis as the criteria used in evaluating a leasehold proposal. The City Manager may authorize assignments which do not require amendment of the master lease provisions and do not extend beyond the term of the lease. 8. Subleases. Requests for sublease approval will be considered on the merits of each individual transaction. No sublease shall be approved which would be detrimental to the City's rights under the master lease. The City Manager may authorize subleases which meet this condition and which do not require amendment of the master lease nor extend the term of the lease. 9. Amendments. Amendments of long-term leases require Council authorization.Whenever there is a substantial amendment,staff shall provide the Council an indication of the fair return for the leasehold. This can be accomplished by appraisals, a survey of the market rate of return, a combination of the above, or any other relevant information. 10. Updating Lease Terms. Lease terms shall be updated as often as practicable whenever there is a request for assignment or significant amendments or subleases are proposed. 11 . Financial Encumbrances. The City will generally not subordinate its fee interest to encumbrances placed against the leasehold by the lessee without specific authorization of the City Council. 12. Tenant Improvements. Improvements installed by the lessee will be removed at termination without cost to the City or they will revert to the City. In the event of removal, the property will be returned to "as was" condition. All leasehold improvements and alterations require prior approval by the City Manager or City Council, depending on the term of the lease. Any improvements within a public right-of-way by a lessee shall be deeded to the City. 13. Lease Term. Lease terms will be limited to the shortest practical time commensurate with the amount of capital investment in permanent improvements to be made by the lessee in accordance with State law. 14. Audits. All percentage leases may be audited by the City in the first year of operation to establish proper reporting procedures and at least once every three years thereafter. More frequent audits may be made if appropriate. The City shall reserve the right to audit all other leases and agreements if determined warranted by the Director of Finance or City Manager. Absent a City audit, a lessee shall submit an annual report certified by a certified public accountant each year within 30 days of the anniversary date of the lease. 15. Cancellation Clauses. Short-term leases shall not have cancellation clauses unless they are month-to-month leases. 1 CITY OF REDDING, CALIFORNIA COUNCIL POLICY SUBJECT RESOLUTION POLICY EFFECTIVE NUMBER NUMBER DATE PAGE DISPOSITION OF CITY-OWNED REAL PROPERTY 94-142 1901 5-17-94 8 of 13 16. Lease Provisions. Generally, leases shall be prepared either by the City Attorney or by the Department of Planning and Community Development for review by the City Attorney and submitted to the City Council or City Manager. Provisions in leases for City property shall cover the following: a. Term. b. Payment of taxes. c. Use of premises. d. Subleases and assignments. e. Insurance. f. Nondiscrimination. g. Tenant improvements. h. Signage. I. Rents and payment schedule. j. Hold harmless. k. Maintenance and repairs. I. Unlawful use. m. Right to inspect. n. Cancellation. o. Breach of contract. p. Litigation and attorneys' fees. q. Failure to pay rent. r. Surrender of premises. s. Bankruptcy or insolvency. t. Notices. u. Deposits. v. Successors in interest. w. Other provisions as applicable. 17. Month-to-Month Leases. The City Manager may enter into month-to-month leases for use of City property. After one year, such leases shall be subject to ratification by the City Council and revaluation of the rent rate. I. Option Agreements 1 . Option to Sell. When properties have been put up to sealed or oral bids and bids have either not been received or have been rejected by the City, the City Manager may enter into an option agreement of up to 90 days with someone interested in purchasing surplus property. Any such option agreement shall be subject to the following minimum terms: a. Shall not exceed 90 days without approval of the City Council. b. Shall be for the purpose of the prospective buyer, doing due diligence to see if the property is feasible for his/her purposes. CITY OF REDDING, CALIFORNIA COUNCIL POLICY SUBJECT RESOLUTION POLICY EFFECTIVE NUMBER NUMBER DATE PAGE DISPOSITION OF CITY-OWNED REAL PROPERTY 94-142 1901 5-17-94 9 of 13 c. Shall require a minimum nonrefundable deposit of not less than '/2 percent of the value of the property per month of the option agreement. d. Shall require forfeiture of the deposit if the property is not placed in escrow within 90 days. e. Shall set the minimum purchase price of the property at not less than the appraised fair market value based on an appraisal that was prepared within 12 months of the date escrow was opened and shall provide a nonrefundable deposit in an amount agreed upon by the City Council and the length of escrow. f. Shall disclose all realtors involved, if any. g. Shall disclose the name of the buyer and his/her intended use of the property. 2. Option to Lease. The City Manager may enter into a 30-day, option-to-lease agreement. Such option shall require a deposit equal to the first month's rent, of which 50 percent shall be forfeited if a lease is not entered into. Generally, the provisions of Section I, Option Agreement, will apply to Option to Lease. J. Real Estate Listing When it is determined that any real property owned by the City is to be disposed by sale, the City Council may authorize a written listing contract with a real estate broker licensed by the State of California. Absent such a contract, it will be the presumption that the City will act as its own agent and that any real estate agent or broker will represent the buyer. Selecting a real estate broker to provide real estate services will be accomplished through a competitive recruitment process based on the type of property to be marketed, relevant experience, knowledge of the community, proposed commission, qualifications, necessary licenses in good standing, and demonstrated competence. It will be the policy of the City to first solicit realtors in Shasta County as long as there are not less than three qualified firms to interview. If there are not at least three eligible candidates, then the City Council may authorize broader recruitment to ensure a competitive process, to demonstrate the best value to the public, or to reach a broader market. Absent a real estate listing, the Council may still designate certain surplus property for sale or lease for which the City would pay a partial commission upon the successful conclusion of a sale or lease. Basically, the agent or broker that procures a buyer or lessee to the City would be eligible for a commission. A commission would not be paid for subleases and existing leases on City property. While the City will allow agent or broker participation on designated properties in the sale and lease of land not covered by contract, inherent in this is the right of the City to solicit and obtain sales or leases through in-house capabilities. There will not be any discount in land values or lease rates due to the absence of a commission to real estate brokers. • CITY OF REDDING, CALIFORNIA COUNCIL POLICY SUBJECT RESOLUTION POLICY EFFECTIVE NUMBER NUMBER DATE PAGE DISPOSITION OF CITY-OWNED REAL PROPERTY 94-142 1901 5-17-94 10 of 13 K. Time of Payment of a Rea/Estate Commission for a Sale In the event an agent or broker covered by contract with the City procures a buyer who submits either the highest bid or an offer to purchase based on the fair market value of the parcel and the sale is made and completed in due course, the commission provided in said contract shall be paid to the agent or broker by the escrow agent from the sales proceeds. L. Rea/Estate Commissions The City may pay a real estate brokerage fee for qualified representation of a selected lessee or purchaser of City property. When the amount of rental or purchase price offered are criteria for selecting a lessee or purchaser in competitive situations, the selection will be based on the highest net rental or net purchase price, without taking into account any brokerage fees involved in the competition. Unless there is a written contract between a real estate agent or broker and the City, the City shall represent itself and practice good business practices in all real estate transactions. Listing contract. Any listing contract shall set forth the maximum commission to be paid if the property is sold or leased. The amount of commission will be based on various factors including, but not limited to, the following: 1 . The value of the property. 2. The amount of work to be performed by City staff. 3. How fast the City wants to move the property. 4. The term of the lease. 5. The net proceeds from the sale or lease. 6. How much work is done to conclude the sale or lease by the agent or broker. 7. How long the property is listed. 8. The price offered in relation to the appraised value. As a general rule, the following commissions to real estate agents or brokers would apply for sales of designated City property under $500,000. Type of Sale Agent Under Contract' Agent Not Under Contract Single Family Residence 6% 3% Land With Structure 6% 3% Undeveloped Land 10% 5% Sales in excess of 5500,000 are subject to negotiation and would be expected to occur at lesser percentage rates. CITY OF REDDING, CALIFORNIA COUNCIL POLICY SUBJECT RESOLUTION POLICY EFFECTIVE NUMBER NUMBER DATE PAGE DISPOSITION OF CITY-OWNED REAL PROPERTY 94-142 1901 5-17-94 11 of 13 M. Payment of a Real Estate Commission for a Lease of City Property In the event an agent or broker procures with the City a lessee for City property or a City building at the prevailing lease rates and a lease is entered into in due course, a leasing commission shall be paid to the agent based on the term of the lease, the value of the lease, and the degree of risk associated with a cancellation of the lease. As a general rule of thumb, the following would apply for commissions for successful leases: Lease Terni Agerit Under Contract i Agent N!ot Under Contract Month to month One month's rent One month's rent 5 percent of gross up to a 3 percent of the gross up Longer than one year maximum of five years to a maximum of five years The City Council may authorize greater percentages for difficult property to lease or if the property is vacant for an extended period of time or for longer lease terms where entering into such long-term lease is in the best interests of the City. The actual commission for a successful lease would be a function of the term of the lease and the income from the lease. Shorter leases will generally be at a higher percentage commission than longer leases if not based on a flat fee. One-half of a commission for a lease would be paid upon execution of the lease, the payment of deposits, and the delivery of acceptable insurance. The other one-half would be paid at the end of one year of continuous occupancy. Commissions will not be paid on unsuccessful leases or lease offers not accepted by the City. N. Real Estate Agent or Broker Certification For any sale or lease involving a real estate agent or broker not under contract to the City on designated properties, the City shall require the following: 1 . That the buyer or lessee certify that the real estate agent or broker is his/her agent in the transaction and has performed a service and procured the sale or lease. 2. That the real estate agent or broker certify that he/she is not an employee of the lessee or buyer. 0. Split Commissions In the event more than one agent or broker is involved in a sale or lease, the City shall only pay a single commission for designated property, as set forth above, to the agent or broker who procured the sale. Any division of a commission paid by the City shall not be the obligation of the City. CITY OF REDDING, CALIFORNIA COUNCIL POLICY SUBJECT RESOLUTION POLICY EFFECTIVE NUMBER NUMBER DATE PAGE DISPOSITION OF CITY-OWNED REAL PROPERTY 94-142 1901 5-17-94 12 of 13 P. Responsibility The Department of Planning and Community Development shall have the responsibility of marketing and identifying surplus properties. The action of the department shall include, but not be limited to, the following: 1 . Identify potential parcels. 2. Refer the property to other City departments. 3. Refer the property to housing agencies. 4. Submit the property to the Planning Commission and initiate General Plan amendment. 5. Obtain toxic or environmental studies. 6. Prepare initial studies and CEQA findings. 7. Prepare the paperwork for City Council and City Manager consideration. 8. Order "for sale" signs. 9. Order appraisals. 10. Place ads in the newspaper. 11 . Notify real estate firms and adjoining property owners that a parcel is for sale or lease. 12. Obtain any necessary lot splits. 13. Prepare option agreements, sales agreements, use agreements, or leases for review and approval by the City Council, City Manager, and City Attorney. 14. Prepare bid or proposal packages as needed in conformance with this policy. 15. Conduct sealed-bid openings. 16. Maintain a mailing list of parties interested in surplus City property. The Department of Planning and Community Development shall develop and maintain a map and list of City-owned lands other than street rights-of-way or easements. The Department of Public Works shall maintain an atlas depicting road and utility easements. The City Clerk shall maintain a copy of deeds of City-owned land, streets, and easements. The Department of Finance shall collect rent payments. The Risk Manager shall review insurance certificates for leases. CITY OF REDDING, CALIFORNIA COUNCIL POLICY SUBJECT RESOLUTION POLICY EFFECTIVE NUMBER NUMBER DATE PAGE DISPOSITION OF CITY-OWNED REAL PROPERTY 94-142 1901 5-17-94 13 of 13 Q. Use of Proceeds Unless otherwise directed by the City Council, proceeds from sales or leases shall be assigned as follows: 1 . To enterprise accounts if the property was purchased using rate-payer funds. 2. To the General Fund account established by Council Policy No. 407. 3. To the Airport Fund if at the Redding Municipal Airport. 4. To a program or grant that requires refunding if the land were purchased using a source of money with that type of restriction. R. Costs to Sell, Lease, and Market Surplus Properties Unless otherwise directed, the costs to sell, lease, exchange, or market surplus properties shall be charged to the fund established by Council Policy No. 407. To that end, the Department of Planning and Community Development shall submit, as part of the annual budget proposal, an estimate to administer the surplus property program. S. Public Utilities Installed by Private Entities An applicant for the use of unimproved City land for public purposes such as streets, sewers, and other public utilities shall compensate the City for the fair market value of the easement rights to be granted by the City if the cost of allowing the improvement reduces the value of the property or is not the reason for which the City acquired or accepted a deed to the property. The amount of compensation shall be established by appraisal. However, lands which have been gifted or deeded to the City without compensation by private entities shall at the option of the grantor carry a reservation to the grantor for a period of ten years following the date of conveyance to the City which would permit the grantor to install public utilities serving the grantor's adjacent land without the payment of compensation to the City therefor and provided further that such installations shall not adversely affect any prospective use of the City's property. T. Severability If any section, subsection, sentence, clause, phrase, or portion of this policy is for any reason held to be invalid or unconstitutional by the decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this policy. The City Council hereby declares that it would have adopted this policy and each section, subsection, sentence, clause, phrase, or portion thereof, irrespective of the fact that any one or more sections, subsections, sentences, clauses, phrases, or portions be declared invalid or unconstitutional. U. Priority Handling Since time is of essence in land transactions, all such actions shall be given the highest priority and special handling. 5-17-94 PROJ\POLICY\PROPDISP.POL