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Agenda Item
ASR
Control 22-000593 |
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MEETING DATE: |
07/19/22 |
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legal entity taking action: |
Board of Supervisors |
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board of supervisors
district(s): |
5 |
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SUBMITTING
Agency/Department: |
County Executive Office (Approved) |
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Department contact
person(s): |
Dylan Wright (714) 480-2788 |
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Thomas A. Miller (714) 834-6019 |
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Subject: Sale and Lease of Laguna
Beach Library with the City of Laguna Beach
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ceo CONCUR |
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Clerk of the Board |
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Concur |
Approved Agreement to Form |
Discussion |
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3 Votes Board Majority |
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Budgeted: Yes |
Current Year Cost:
N/A |
Annual Cost:
See Financial Impact |
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Staffing Impact: |
No |
# of Positions:
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Sole Source:
N/A |
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Current Fiscal Year Revenue: N/A
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Prior Board Action: 1/20/1970
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RECOMMENDED ACTION(S):
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1. |
Find that the project is categorically exempt from the California Environmental Quality Act (CEQA), Class 1 (Existing Facilities) pursuant to CEQA Guidelines section 15301. |
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2. |
Approve the purchase and sale agreement and grant deed authorizing the sale of the Laguna Beach Library property located at 363 Glenneyre Street in Laguna Beach to the City of Laguna Beach for the amount of $4,290,000, and authorize the Chief Real Estate Officer or designee to execute in substantially the form attached with minor modifications that do not increase the County obligations or liability. |
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3. |
Approve the lease agreement between the City of Laguna Beach and the County of Orange for Orange County Public Libraries’ use of the property as a public library for a 25-year term with one 25-year option to extend, and authorize the Chief Real Estate Officer or designee to execute in substantially the form attached with minor modifications that do not increase the County obligations or liability. |
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4. |
Authorize the Chief Real Estate Officer or designee to execute documents and take any actions necessary to effectuate the sale of the property to the City of Laguna Beach consistent with the purchase and sale agreement, as well as lease modification, option terms and amendments that make non-monetary and/or monetary changes that do not increase County liability, obligations or costs by more than $75,000 per year, as approved by County Counsel. |
SUMMARY:
Approval of the proposed purchase and sale agreement will allow the City of Laguna Beach to exercise its option to purchase the Laguna Beach Library property with all improvements and approval of the lease agreement will allow Orange County Public Libraries to continue occupying the property and providing free public library and related services.
BACKGROUND INFORMATION:
On January 20, 1970, the County of Orange (County) and the City of Laguna Beach (City) entered into an agreement (Library Agreement) for the purpose of conveying land for the construction and operation of the Laguna Beach Library located at 363 Glenneyre Street in Laguna Beach (Property). Per the Library Agreement, the County acquired parcels numbered 608-2 and 608-2.1 from private sellers and the City conveyed adjacent parcels numbered 608-1 and 608-1.1 to the County without monetary consideration to form the site of the Property. Additionally, the City reserved an option to purchase the Property with all improvements within 50 years of the execution date of the Library Agreement for a purchase price equal to the fair market value of the County’s investment in the underlying parcels of the Property. The City exercised its option to purchase on or about January 9, 2020, for a purchase price of $4,290,000 based on the valuation set forth in an appraisal report ordered by the City and reviewed by CEO Real Estate. The sale process was paused during the COVID-19 pandemic but has resumed. The County will retain the funds from the sale of the property (Purchase Price Principal) for use in connection with improvements to the Property or for public library related matters as agreed upon by both the County and the City.
Orange County Public Libraries (OCPL) provides free public library and related services on the Property which is comprised of a two-story building containing approximately 10,290 rentable square feet (RSF) of space along with approximately 29 parking spaces. OCPL occupies 9,840 RSF within the Property and has 10 parking spaces designated for staff. The City’s Chamber of Commerce occupies the remaining 450 RSF within the Property. Upon completion of the sale of the Property, the County will enter into the attached lease agreement (Lease) with the City to continue OCPL’s occupation of the space to continue operating the library. The Lease shall commence on the day after the completion of the sale of the Property and has a term of 25 years with an option to extend the term for an additional 25 years. The Lease will be rent-free in exchange for the valuable consideration of providing free public library and related services to the community.
The County or City may terminate the Lease by providing at least 18 months written notice to the non-terminating party. However, if the majority of the Purchase Price Principal is expended on the capital improvements to the Property, the Lease cannot be terminated for a period of 15 years after the completion of the capital improvements unless the County and City agree to a reimbursement plan for the costs.
COMPLIANCE WITH CEQA: The proposed project is Categorically Exempt (Class 1) from the provisions of CEQA pursuant to Section 15301, because it involves a lease agreement of existing facilities, involving no expansion of existing use.
FINANCIAL IMPACT:
The revenue associated with the purchase, in the amount of $4,290,000, will be deposited in Fund 120, OC Public Libraries. The funding will be used for future improvements at the Laguna Beach Library.
STAFFING IMPACT:
N/A
REVIEWING AGENCIES:
OC Community Resources
ATTACHMENT(S):
Attachment A – Purchase and Sale Agreement and Grant Deed
Attachment B – Lease Agreement
Attachment C – Location Map
Attachment D – Lease Summary
Attachment E – Real Estate Questionnaire