Req. #1 3318
RESOLUTIONNO. JF,529
1 A RESOLUTION relating to economic development; adopting the Policy for the
2 SalelDisposition of City-owned General Government Real Property.
3 WHEREAS this resolution was initiated by the City Council's request for
4 the development of a policy that establishes a framework for the disposition of
5 City-owned property, and
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WHEREAS City laws and procedures govern the mechanisms for the
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8 disposition of City-owned real property, which currently include three established
9 processes for surplus sale: (1) direct negotiated disposition; (2) request for
10 proposals; and (3) bid sale to the highest bidder, and
1 1 WHEREAS, following a series of four meetings with the Economic
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Development Committee ("EDC") to discuss and revise the proposed policy
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14 based on City Council feedback, City staff generated a proposed policy that will
15 establish: (1) guiding principles for the sale of City-owned property, which are
16 based on the core philosophy that the City should retain properties that meet its
1 7 property ownership objectives and sell properties that do not; (2) a system for
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the classification of properties for sale, which is comprised of three tiers with
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20 differing policy objectives and correlative disposition processes; and (3) guiding
21 principles for direct negotiated dispositions, and
22 WHEREAS, on August 7, 2012, the proposed policy document received a
23 do pass" from the EDC- Now, Therefore,
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Res13318.doc-JHC/ajs
1 BE IT RESOLVED BY THE COUNCIL OF THE CITY OF TACOMA:
2 That the Policy for the SalelDisposition of City-owned General
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Government Property, attached hereto as Exhibit "A" and by this reference
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5 incorporated herein, is hereby adopted.
6 Adopted AuG 2 1 2012
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K'Aw
8 Mayor
9 Attest:
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1 1 City Clerk
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Approved as
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14 Deputy CityAttorney
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48 Res13318.doc-JHC/ajs
1 EXHIBIT "A
2 Policy for the Sale/Disposition of City-owned
3 General Government Real Property
4 A. Background
5 The City owns a variety of properties to meet its objectives, including properties which
site City buildings and facilities, parks, open spaces, tidelands, and rights-of-way. The
6 City also owns properties which support specific community programs such as
7 libraries, senior centers, public assembly facilities, and centers for performing arts.
Further, the City owns certain properties which the City has either acquired or retained
8 ownership for the specific purpose of redevelopment or for partnering with the private
sector to redevelop. Lastly, the City owns certain properties which it has acquired over
9 the course of the past 128 years since incorporation, and for which the City no longer
has an interest in retaining ownership.
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Overall, the City should retain properties which meet its property ownership objectives
1 1 and sell properties which do not.
1 2 B. Guiding Principles for the Sale of City-owned Property
1 3 1 . The City should retain ownership of properties necessary for conducting its
business operations, supporting community and economic development
14 initiatives, and for the preservation of public spaces and open space.
1 5 2. The City should endeavor to sell those City-owned properties which do not
meet the City's property ownership objectives. Among the City's goals in
1 6 property dispositions are: private development which meets the City's economic
development objectives, development of affordable housing, historic
1 7 preservation, and increasing density and improving walkability in support of the
1 8 City's Comprehensive Plan objectives.
3. The City has three established processes for selling City-owned property: (1)
1 9 direct negotiated disposition; (2) request for proposal process; and (3) bid sale
to the highest bidder. Having several tools for the sale of City property gives
20 the City useful options and flexibility when selling property to meet the needs of
21 the City and community.
4. City staff should classify its properties to be sold in order to help guide the
22 determination of which sale process should be utilized for selling specific City
properties. This classification is helpful because the City owns a variety of
23 properties with varying levels of value and interest to the City and community.
24 In sum, not all properties need to be sold the same way.
5. The City should establish appropriate processes for notifying the City Council
25 and the public prior to selling property. This notification will vary based on the
classification of the property. This process shall be transparent to the Council
26 and the public.
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Res13318.doc-JHC/ajs
C. Property Classification
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Property that has been identified for sale or transfer will be classified into three tiers
3 with differing policy objectives. City staff will develop and maintain processes for each
property tier that are consistent with the policy objective.
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Tier 1 properties are generally those properties that: (1) are strategically located in the
5 downtown or a mixed-use center with high visibility; (2) are high value (greater than
6 $500,000) and sizable (one-third of an acre or greater); (3) have the potential to
generate a high level of community interest due to substantial neighborhood or
7 City-wide impact that may result from their development; and (4) can be instrumental in
meeting the City's economic development goals and/or in implementing its key policies.
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Overall goals for sale of these properties will be to achieve a reasonable return on
9 investment through such outcomes as: generate new property taxes, sales tax,
business and occupation taxes, and other taxes, generate new family wage jobs,
1 0catalyze new private investment and/or leverage existing public facilities, minimize
public liability, implement City master plans, encourage density, and promote
sustainability.
1 2 Tier I Disposition: The process for property disposition will generally involve
1 3 outreach and high levels of participation. The Request for
Qualifications/Request for Proposals approach will be the preferred method of
1 4 disposition. Exceptions to this policy may include property sales to other public
entities and property transfers which are the result of public-private
1 5 development partnerships - in these situations, the property will likely be
6 conveyed via the direct negotiated disposition process.
1 7The City will maintain an inventory of Tier 1 properties and the City's associated
objectives through its economic development strategy. Additional guidance on direct
1 8negotiation is found in Section D of this policy.
1 9Tier 2 properties are those properties which have some development potential, are
important to the surrounding neighborhood, and have a value greater than $250,000,
20 but have no significant alignment with the City's economic development interests or
other City goals and policies.
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22 Overall goals for sale of these properties will be to support goals and strategies of
applicable neighborhood councils and neighborhood business districts through such
23 outcomes as: increase affordable housing, improve the quality of life and property
values in the neighborhood, improve walkability, foster a safe environment for
24 residents, reduce crime and blight in the community, and increase tax revenue for the
City.
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Tier 2 Disposition: Because of the importance to community stakeholders,
26 Tier 2 properties will likely be sold via a Request for Proposals or negotiated
disposition process to put the City in a better position to influence the future
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ResI3318.doc-JHC/ajs
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1 use(s) of the property. Because of potential community impacts and interest,
there will be opportunities for community feedback and outreach and the City
2 has a vested interest in influencing the future use(s) of the property.
3 Tier 3 properties are those properties which may be important to the adjacent or
4 surrounding property owners but have a minimal level of interest to the community at
large. Tier 3 properties will be sold to minimize the City's liability and turn ownership
5 back the private sector or to public partners. These properties include: remnant
parcels that have little or no financial value and may negatively impact the adjacent
6 owner; properties that would only be considered for acquisition by abutting neighbors;
vacant City parcels that have no operational, development, or open space potential to
7 the City; properties that by virtue of their location or functionality would be better owned
by another government agency; and other properties which have little financial value.
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9 Overall goals for sale of these properties will be to reduce City liability for property
maintenance and operations, return underutilized properties to the tax rolls and private
10 ownership, and initiate sale and development that encourages improvement for the
neighboring residences.
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Tier 3 Disposition: Tier 3 properties will likely be sold by direct negotiated sale
12 when selling to neighbors. In most other cases, Tier 3 properties will be sold
via bid-sale to the highest bidder. Because of the limited impact of these
13 property sales, community outreach efforts will generally be more direct and
limited.
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15 D. Guiding Principles for Direct Negotiated Dispositions
City code allows the City, upon City Council authorization, to approve the negotiated
16 disposition of real property (see TIVIC 1.06.280). This authority provides the City with
1 7substantial flexibility to sell property to governmental and nonprofit agencies, adjacent
property owners, and public-private development partners. While competitive selection
18 for surplus sales is ordinarily preferred, there are circumstances where direct
negotiation is in the best interests of the City. In considering whether a direct
19 negotiated disposition should be pursued, City staff will consider the following
guidelines, ranked in order of procedural clarity:
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1 . The City should consider selling surplus property directly to adjacent/abutting
21 property owners when the adjacent/abutting property owner(s) are the only
22 feasible or likely candidates for acquisition and when selling to another party
would have significant detrimental effects to the adjacent/abutting property
23 owners; and when selling to the adjacent/abutting property owner(s) will allow
for expansion and development of a profit or nonprofit enterprise increasing
24 economic and community improvement opportunities within the City; and further
when said sale is an ancillary component of a street vacation.
25 2. The City should consider selling surplus property directly to other governmental
26 agencies and nonprofit agencies when the proximity or functionality of said
surplus property improves the ability of the organization to achieve its mission
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Res13318.doc-JHC/ajs 5i
1 and where the City can achieve economic benefit through an increase in sales
tax, admissions tax, or other revenues.
2 3. The City may transfer property to a City-formed Public Development Authority
3 to develop according to a City-approved plan or development strategy.
4 4. Where feasible, the City should consider selling surplus property suitable for
housing directly to governmental and nonprofit agencies who will repurpose the
5 property to include affordable housing, or to negotiate components of affordable
housing in sale documents or development agreements.
6 5. The City should consider selling surplus property directly to a private
7 development partner when the conveyance of the property is an element of a
public-private partnership agreement between the City and a third party that
8 has been approved by the City Council and is necessary to achieve the desired
development; and when (even if the City is not a development partner) the
9 development will help the City achieve its economic development goals and is
more suitable than existing alternatives and potential partners.
10 6. In the circumstance where the City has previously completed a Request for
1 1 Proposals process and an acceptable proposal was not received, the City may
directly or through a third-party agent contact potential developers/investors
12 and directly negotiate a sale.
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Res13318.doc-JHC/ajs
CITY CLERK USE ONLY
REQUEST FOR qF,(,F un#:
bomia
0 ORDINANCE Z RESOLUTIO@@ Ord./Res.
Oj id
1. DATE: August 8, 2012
w6l laz
2. SPONSORED BY: COUNCIL MEMBER(S) N/A %,s ? #L4L
3a. REQUESTING 4a. CONTACT (for questions): PHONE:
DEPARTMENT/DIVISION/PROGRAM Conor McCarthy 253-591-5320
PWD/Facilities Management/ Asst. Division Manager
Real Property Services
3b. "Do PASS" FROM Economic
Development Committee - 4b. Person Presenting: PHONE:
August 7, 2012. Conor McCarthy 253-591-5320
Yes Asst. Division Manager
No
0 To Committee as information
only 4c. ATTORNEY: PHONE:
F1 Did not go before a Committee Jeff Capell 253-591-56
3c. DID THIS ITEM GO BEFORE THE Deputy City Attorney
PUBLIC UTILITY BOARD?
F@ Yes, on
Not required
WA
McKinley, Public Works Director Jeff Litchfield, Interim Finance Director a ard. Asst Citv Man
r5. REQUESTED COUNCIL DATE: August 21, 2012
(If a specific council meeting date is required, explain why; i.e., grant application deadline, contract
expiration date, required contract execution date, public notice or hearing required, etc.)
6. SUMMARY AGENDA TITLE: (A concise sentence, as it will appear on the Council agenda.)
Approve the Policy for the Sale/Disposition of City owned general government real property.
7. BACKGROUND INFORMATIoN/GENERAL DISCUSSION: (Why is this request necessary? Are there legal
requirements? What are the viable alternatives? Who has been involved in the process?)
The City has laws and procedures which govern the mechanisms for the disposition of City owned real
property, including three established processes for surplus sale: (1) direct negotiated disposition, (2)
request for proposals, and (3) bid sale to the highest bidder.
While the City has established procedures for the sale of property, the City Council asked staff to develop
a policy which establishes a framework for the disposition of City owned property
This policy establishes (1) Guiding Principles for the Sale of City owned property; (2) Classification of
properties for sale; and (3) Guiding Principles for Direct Negotiated Dispositions.
Overall, the City should retain properties which meet its property ownership objectives and sell properties
which do not. Property for sale will be classified into three tiers with differing policy objectives and
correlative disposition processes.
In addition, this policy will provide guidelines for staff to use when negotiating the disposition of real
property. This authority provides the City with substantial flexibility to sell property to governmental and
nonprofit agencies, adjacent property owners, and public-private development partners.
City staff has met with the Economic Development Committee (EDC) on four separate occasions to
discuss and edit the policy based on Council feedback. A'do pass'from the EDC was received on
Tuesday August 7, 2012. 53
cotclerk\forms\RequestResoltitionOrdinance.doc
CITY CLERK USE ONLY
REQUEST (CONT) Request --3. @ IL
36bZ9
Ord/Res
8. LIST ALL MATERIAL AVAILABLE AS BACKUP INFORMATION FOR THE REQUEST AND INDICATE WHERE FILED:
Source Documents/Backup Material Location of Document
Sale/Disposition of City Owned Property Policy City Clerk's Office
9. WHICH OF THE CITY'S STRATEGIC GOALS DOES THIS ITEM SUPPORT? (CHECK THE GOAL THAT BEST APPLIES)
A. A SAFE, CLEAN AND ATTRACTIVE COMMUNITY
B. A DIVERSE, PRODUCTIVE AND SUSTAINABLE ECONOMY
C. A HIGH-PERFORMING, OPEN AND ENGAGED GOVERNMENT
IO. SUSTAINABILITY: Does this request meet the City's Sustainability Priorities? (check all that apply)
F-1 Environment: improve regional and local ecological well-being.
Z Equity: promote meeting basic needs and equitable access to opportunities for all city residents.
F] Culture: improve the cultural and quality of life for all citizens.
ZEconomy: contribute to economic development and serve as a responsible steward of public resources.
Describe how this request supports the above sustainability priorities.
This policy encourages citizen participation and the consideration of community safety, neighborhood
needs, and affordable housing when disposing of City owned property. This policy encourages the
development of unused properties to generate new property taxes, sales tax, B&O and other taxes and
generate new family wage jobs. In addition, this policy will encourage the return of underutilized
properties to the tax rolls and private ownership.
11. IFTHISCONTRAC'fISFORANAMOUNTOF$200,OOOORLESS,EXPLAINWHYITNEEDSLEGISLATIVEAPPROVAL:
12. FINANCIAL IMPACT: F@ EXPENDITURE F1 REVENUE
A. No IMPACT (NO FISCAL NOTE)
B. YES, OVER $1 00,000, Fiscal Note Attached
C. F@ YES, UNDER $ 1 00,000, (NO FISCAL NOTE)
Provide funding source information below:
FUNDING SOURCE: (Enter amount of funding from each source)
Fund Number & Name: State $ city $ Other $ Total Amount
If an expenditure, is it budgeted? F] Yes El No Where? Cost Center:
Acct
. . . . . .4- Office of the City Clerk (011071201 1)
13 8 529
bcoma
City of Tacoma Memorandum
TO: T.C. Broadnax
City Manager
FROM: Dick McKinley
Public Works Direct r
SUBJECT: Council Action Memo - Request for Resolution - August 21, 2012
Policy: Sale/Disposition of City-Owned Property
DATE: August 14, 2012
Public Works is requesting City Council to approve the Policy for the Sale/Disposition of City-owned
general government real property.
Background
The City has laws and procedures which govern the mechanisms for the disposition of City-owned
real property, including three established processes for surplus sale: (1) direct negotiated
disposition; (2) request for proposals; and, (3) bid sale to the highest bidder.
While the City has established procedures for the sale of property, staff was asked to develop a
policy which establishes framework for the disposition of City-owned property.
This policy establishes: (1) Guiding Principles for the Sale of City-owned property; (2) Classification
of properties for sale; and, (3) Guiding Principles for Dire6t Negotiated Dispositions.
Overall, the City should retain properties which meet its property ownership objectives and sell
properties which do not. Property for sale will be classified into three tiers with differing policy
objectives and correlative disposition processes.
In addition, this policy will provide guidelines for staff to use when negotiating the disposition of real
property. This authority provides the City with substantial flexibility to sell property to governmental
and nonprofit agencies, adjacent property owners, and public-private development partners.
City staff has met with the Economic Development Committee (EDC) on four separate occasions to
discuss and edit the policy based on Council feedback. A'do-pass'from the EDC was received on
Tuesday, August 7,.2012.
55
1@i P 5 29
Resolution No.
Adopted: AUG 2 1 2012
Maker of Motion: P",N/,o L- ^ ^ ,-,
Seconded:
Voice Vote:
MEMBERS AY NAYS ABSTAIN
Mr. Boe ABSENT
Mr. Campbell- L/
Mr. Fey
Mr. Ibsen
Mr. Lq@j@n@
Mr. Mello
Ms. Walker
Ms. Woodards
Mayor Strickland
Roll Call Vote:
MEMBERS AYES-- NAYS ABSTAIN ABSENT
Mr. Boe
Mr. Campb!,Il
Mr. Fev
Mr. lb@en
Mr. -onergan
Mr. Mello
Ms. Walker
Ms. Woodards
Mayor
m1ccagendalagenda Pro-dures and fo-sVesoltAionvotingrecorddoc