City Council Agenda
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Memo to: |
Manteca City Council |
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From: |
Toni Lundgren, City Manager |
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Prepared by: |
Barbara Harb, Deputy Director Economic Development |
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Date: |
April 15, 2025 |
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Subject: |
Declaration of Surplus Property: Approximate 3.75-acre portion of the city-owned parcel located at 1403 W. Atherton Dr. (APN 226-160-22) |
Recommendation:
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Adopt a resolution pursuant to Government Code Section 54221(b) declaring an approximate 3.75-acre portion of the city-owned subject property (“Property”) located at 1403 W. Atherton Dr. (226-160-22) is surplus land and taking related actions to determine the Property exempt from CEQA review under sections 15378 and 15061 (b) (3) of title 14 of the California Code of Regulations.
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Background:
The property at 1403 W. Atherton Dr. (APN 226-160-22) was purchased by the City of Manteca in February 2024 using general fund revenue. The City initially intended to purchase only a small portion of the western most section of the parcel; however, the Property-owner would only agree to the sale of the Property if it was sold in its entirety. Therefore, the city purchased the Property and is now taking the proper steps to dispose of the portion of the property that is not planned for City use.
The City aims to attract developments that can provide sustainable revenue to the City. However, in selling, leasing, or transferring the Property, the City must comply with the Surplus Land Act (“SLA”) (Government Code Sections 54220-54234) and therefore staff recommends that the City undertake the appropriate proceedings as required to notice the Property in accordance with the Surplus Land Act.
The SLA defines “surplus land” as land owned in fee simple by a local agency (including the City), which is not necessary for the local agency’s use. The SLA requires the governing board of the local agency to take formal action in a regular public meeting to declare such land surplus land or exempt surplus land. There are limited situations in which property qualifies as exempt surplus land, which are not applicable to this Property; therefore, the City must follow the requirements of the SLA.
When disposing of surplus land, a local agency must undertake certain proceedings under the SLA. The local agency must send a Notice of Availability (“NOA”) of the surplus land to designated entities set forth in the SLA for authorized purposes set forth in the SLA prior to participating in negotiations to dispose of the property. The designated entities include housing developers, local public entities, park and recreation departments, regional park authorities, the State Resources Agency, and school districts. The authorized purposes include low- and moderate-income housing, park, recreation, open-space, and school purposes. A designated entity that is interested in acquiring surplus land for the development of low- and moderate-income housing must agree to restrict at least 25% of the units for low-income households.
Designated entities will have 60 days to respond to the NOA. The local agency must then enter into good faith negotiations with those designated entities that responded to the NOA for not less than 90 days in an attempt to agree to a mutually satisfactory sales price and terms or lease terms. If more than one designated entity responds, the local agency must give negotiating priority to the entity that agrees to use the surplus land for low- and moderate-income housing, regardless of the current zoning of the property. If there is more than one such entity, the local agency must give negotiating priority to the entity that proposes the greatest number of affordable units, and, if there is a tie, the local agency must give negotiating priority to the entity that proposes the deepest average level of affordability for the affordable units.
At the conclusion of the good faith negotiating period, if the local agency does not agree to price and terms with any of the designated entities, or if no designated entity responded to the NOA, the local agency may dispose of the property outside of the SLA. However, the local agency must record a covenant against the land, which provides that if 10 or more residential units are developed on the property, not less than 15% of the units will be affordable for low-income households.
At the conclusion of the good faith negotiation period and prior to finalizing any agreement or disposing of the surplus land, the local agency must report certain information to the California Housing and Community Development Department (“HCD”). Such information must include a summary of any negotiations and a copy of any covenant to be recorded against the property. HCD will have 30 days to review the information and determine if the proposed sale or lease complies with the SLA. The local agency will have an opportunity to correct any issues identified by HCD or explain how its process complied with the SLA. If HCD ultimately determines that a disposition violates the SLA, HCD will impose a penalty on the local agency (equal to 30% of the sale price for a first violation and 50% for subsequent violations, which penalty cannot be paid with funds already dedicated to affordable housing).
The resolution does not approve a sale of the Property; an agreement will be presented to the City Council for its consideration at a future meeting. The resolution only declares that the Property is surplus land and initiates the required proceedings under the SLA. The resolution directs that a NOA be sent to the designated entities in accordance with the SLA and authorizes actions to implement the resolution and the SLA, including negotiating with designated entities that respond to the NOA.
CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA):
Pursuant to the resolution, the City Council finds that the declaration of the Property as surplus land does not constitute a project under the California Environmental Quality Act (CEQA), as set forth in Section 15378 of title 14 of the California Code Regulations. The declaration of the Property as surplus land does not have the potential for resulting in either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment. Furthermore, to the extent that the declaration is construed as a project under CEQA, it is nonetheless exempt from review under section 15061 (b) (3) of title 14 of the California Code of Regulations because it can be seen with certainty that there is no possibility that the mere declaration of the Property as surplus may have a significant effect on the environment.
Fiscal Impact:
There is no fiscal impact associated with declaring the properties surplus land.
Documents Attached:
Attachment 1 - Resolution