JUNE 21, 2005 PURCHASE OF TAX DEFAULTED PROPERTY JUNE 21, 2005 PURCHASE OF TAX DEFAULTED PROPERTY

TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL

FROM: ASSISTANT CITY MANAGER/CITY CLERK

DATE: JUNE 21, 2005

SUBJECT: PURCHASE OF TAX DEFAULTED PROPERTY

RECOMMENDATION

Authorize the Mayor and City Clerk to sign an Agreement to Purchase Tax-Defaulted Property for a 0.17-acre vacant parcel located at the end of East Crest Road, adjacent to the federal radar dome facility at San Pedro Hill.

BACKGROUND

Pursuant to the State Revenue and Tax Code, properties that are determined to be in default for unpaid property taxes for five years or more are periodically put up for sale at public auction by the Los Angeles County Tax Collector. However, if it is determined that the parcel is needed for public purposes, the City may request to have the parcel removed from the auction and acquire title to the property. The cost of acquisition is the minimum bid for the property as approved by the Los Angeles County Board of Supervisors. However, parcels may be subject to removal from the auction if the owner pays the defaulted taxes or enters into a legal process, such as bankruptcy.

DISCUSSION

Staff has received notice that ten vacant parcels in the City will be offered at public auction on August 8 and 9, 2005. If the City determines that any of the properties are needed for public purposes, the City must file a written statement setting forth the purpose of the acquisition and the necessary agreement forms prior to July 6, 2005.

Of the ten properties currently up for auction, staff feels that the City should try to acquire a vacant parcel located adjacent to the federal radar dome facility at the end of East Crest Road. This same lot was previously up for auction in March 2004 and although the City Council authorized staff to submit a letter of interest on January 20, 2004, staff was informed by the County Tax Assessor that another non-profit agency had already requested to purchase the property, effectively shutting out the City’s request. Apparently, the transaction was never completed and the property is back up for auction, providing the City with a second opportunity to acquire the property.

The minimum bid on this parcel is $2,732 (up from $1,809 eighteen months ago). This property is zoned RS-2 (Single Family Residential). The lot is rectangular in shape and is 75 feet in width along East Crest Road and is 100 feet in depth, for a total of 7,500 square feet or 0.17 acres in size (see attached Site Plan). The first 30 to 40 feet of the lot is level, with the remainder sloping down rapidly into the adjacent canyon. In addition, the first 50 feet of the lot is encumbered by a public right-of-way easement. The first 14 feet of the lot depth is paved as part of Crest Road. Two utility poles and an underground electrical vault are located beyond the roadway, but within the public right-of-way.

Staff believes the primary benefit of purchasing the property would be for public trail purposes. If the City acquires this property, it could provide an important link in completing the Palos Verdes Loop Trail through this portion of the City. Due to its location, at the head of Miraleste Canyon and with access to Crest Road where parking is available, the parcel could serve as a small trailhead park for Upper Miraleste Canyon Segment of the Palos Verdes Loop Trail, as described in Section 4 of the City’s Conceptual Trails Plan (see attached). Further, due to its location near the highest elevation on the Palos Verdes Peninsula (San Pedro Hill), there may be a possibility that the parcel could be used as a location for governmental and commercial telecommunications facilities. However, further studies would be required to determine if this use is viable.

There are nine other properties included in the August 2005 public auction. Staff does not recommend City acquisition of any of these properties due to the fact that one is a landlocked, narrow lot (possibly a drainage course) between the developed lots on Avenida Aprenda and Redondela Drive, another is an extremely steep residential lot on Crownview Drive, and the remaining eight lots are small fragments less than 1,000 square feet in size that are completely within private access road easements in the Portuguese Bend area. Staff feels that City ownership of any these properties would not serve any reasonable public purpose.

ADDITIONAL INFORMATION

The City has previously purchased two tax-defaulted parcels from the County. The first was a vacant lot on Cherry Hill Lane in the Portuguese Bend landslide area that was acquired in 2001 for $2,721 for landslide abatement purposes. The second property was a 17.44 vacant parcel surrounding Del Cerro Park. This open space lot was purchased in 2002 for $17,772 to increase the size of the adjacent public park, provide future trail connections to the Portuguese Bend Nature Preserve and further the City’s efforts to complete the Natural Communities Conservation Plan (NCCP).

CONCLUSION

The Los Angeles County Tax Collector has notified the City that ten properties in the City will be offered for sale at a public auction on August 8 and 9, 2005. The City has the opportunity to purchase these properties prior to the public sale, provided that the City files the necessary paperwork with the County prior to July 6, 2005 to establish that the properties are needed for public purposes. Of the ten parcels up for auction, staff recommends that only the parcel located adjacent to the federal radar dome facility at the end of East Crest Road be acquired by the City. The property could serve as a trailhead park for Upper Miraleste Canyon Segment of the Palos Verdes Loop Trail. In addition, due to its location near the highest elevation on the Peninsula, there may be a possibility that the parcel could be used as a location for governmental and/or commercial telecommunications facilities.

FISCAL IMPACT

The City would be required to purchase the subject parcel for the minimum bid amount, which is $2,732, plus some minor processing costs. The money for the purchase would come from the General Fund. If and when easements are obtained from the other property owners to complete this segment of the Palos Verdes Loop Trail, the City would incur some additional capital costs to improve the property as a trailhead park, such as grading the trail tread, signage, a drinking fountain, benches, etc. In the meantime, the only on-going cost to the City of owning this property would be the annual cost of weed control and trash clean up. In addition to the possibility of using the property for its own telecommunications needs, the City may be able to derive lease income from telecommunications carriers to locate their antenna equipment at the site.

Respectfully submitted:

Carolynn Petru

Assistant City Manager/City Clerk

Reviewed,

Les Evans

City Manager

Attachments:

Notice from the County of Los Angeles dated June 3, 2005

Assessor Maps showing the location of the subject parcel

Site plan of Crest Road parcel

Excerpt from the City’s Conceptual Trails Plan