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HomeMy WebLinkAbout5/21/2003 - STAFF REPORTS (22) DATE: MAY 21, 2003 TO: CITY COUNCIL FROM: DIRECTOR OF COMMUNITY AND ECONOMIC DEVELOPMENT APPROVALOFAN EXCHANGE AGREEMENT WITH THE BARNEYTRUST OF LOSANGELES, CALIFORNIA, EXCHANGING 45 ACRES OF CITY-OWNED OPEN SPACE LAND FOR 45 ACRES OFTRUST-OWNED LAND,WITH PERMANENT OPEN-SPACE RESTRICTIONS BEING RECORDED AGAINST BOTH PROPERTIES RECOMMENDATION: It is recommended thatthe City Council approve the Exchange Agreement with the Barney Trust of Los Angeles, California, exchanging 45 acres of City-owned land for 45 acres of Trust-owned land, with permanent open-space restrictions being recorded against both, thereby increasing the City's supply of dedicated open space land by 45 acres. SUMMARY: The Barney Trust has an interest in ensuring that 45 acres of City-owned land adjacent to property it owns in the Mesa area remains perpetually undeveloped. Even though the City has assured the Trust that the land was obtained for open space purposes, the Trust has offered an additional 45 acres in the Chino Canyon area to the City in exchange for the adjacent property. Both properties would record provisions prohibiting development. The Trust has agreed to absorb all of the costs of the transaction, including the Phase I environmental report, escrow costs, legal costs;and,to hold the City harmless in the event of any litigation that may arise from the exchange. BACKGROUND: The Barney Trust is the owner of unimproved real property located in the Chino Canyon area of the City, consisting of approximately sixty eight (45) acres, and the City is the owner of certain unimproved real property located in the Cahuilla Hills area overlooking the Mesa, consisting of approximately forty five (45) acres. The City Property consists of portion of one parcel conveyed to the City for open space purposes. In addition to the Trust Property described above, the Trust owns additional real property which is located adjacent to the City Property, which has been improved as a residential complex consisting of several residences and outbuildings. The Trust wishes to assure that the City Property shall always and in perpetuity remain in an undeveloped and natural state, with the exception of paths and trails and fencing. Notwithstanding the provisions of the deeds to the City and the intention of the City to maintain the City property in an undeveloped and natural state,the Trust desires further assurances that the City Property will not be developed, and to that end is willing to convey the Trust Property to the City in exchange for the City Property in the fashion set forth in the Exchange Agreement to ensure that neither the Trust Property nor the City Property shall be developed and that those properties shall remain as permanent open space. The City also wishes to ensure that both the City Property and the Trust Property shall always and in perpetuity remain in an undeveloped and natural state; it has a program of open space acquisition, and is always interested in adding to the open space inventory. The City, pursuant to its authority under Government Code Section 37350,to acquire and dispose of property for the common benefit, deems this exchange to be in the best interest of the City because it results in 45 additional acres within the City being held in an undeveloped and natural state for the long term benefit of the City and its residents without expense to the City. In addition,the Trust deems this exchange to be in its best interest because it assures that the City Property will, in perpetuity, remain in an undeveloped and natural state, to the benefit of the Adjacent Trust Property. As an additional incentive to the City,the Trust has agreed to coverall of the costs associated with the exchange. Because of the issue of the trail and pathways, the exact legal boundaries of the City Parcel to be traded for the Trust Parcel will be determined by the Director of Planning and Zoning. A"b 6�� — J HN . RAY O D Di r of Com nity and Economic Development APPROVED �r•� Executive Director ATTACHMENTS: 1. Resolution 2. Exchange Agreement i EXCIIANGE AGREEMENT THIS EXCHANGE AGREEMENT is made effective as of the day of 12003 by and between Gaily C. I{ief, as Trustee of the BARNEY TRUST ("TRUST"), and TIIE CITY OF PALM SPRINGS, CALIFORNIA, a California Chartered Municipal Corporation("City"). RECITALS A The Trust has the right to purchase and, as of the date of closing,will be the owner of that certain unimproved real property located in the City of Palm Springs, County of Riverside, State of California, consisting of approximately forty-five (45) acres which Real Property is more particularly described in attached Exhibit A ("Trust Property"). B The City is the owner of that certain unimproved real property located in the City of Palm Springs, County of Riverside, State of California, consisting of approximately forty five (45) acres which heal Property is more particularly described in attached Exhibit B ("City Property"). C In addition to the Trust Property,the Trust owns additional real property which is located adjacent to the City Property ("Trust Residence Property"). The Trust Residence Property, which consists of several parcels, has been improved as a residential complex, consisting of several residences and outbuildings. D Both The Trust and the City desire to assure that neither the Trust Property nor the City Property are developed, with the exception of paths and trails and fencing, and to that end are willing to accept the respective properties in the fashion set forth herehrafter to assure that neither the Trust Property nor the City Property are developed and that those properties shall remain as permanent open space. E The City,pursuant to its authority under Government Code Section 37350, to acquire and dispose of property for the common benefit, deems this exchange to be in the best interest of the City because it results in 45 additional acres witlxin the City being held in an undeveloped and natural state for the long term benefit of the City and its residents, without expense to the City. P The Trust deems this exchange to be in its best interest because it assures that the City Property will remain in an undeveloped and natural state, to the benefit of the Trust Residence Property. a � � 3 NOW, THEREFORE, in consideration of the mutual covenants and conditions.contained herein,the parties do hereby agree as follows: I EXCHANGE: The Trust agrees to convey the Trust Property to the City and the City agrees to convey the City Property to The Trust, subject to the terns and conditions hereinafter set forth,together with all rights and appurtenances thereto. 2 CONVEYANCE: Each of the parties agree that it shall convey its property to the other utilizing the form of Deed attached hereto as Exhibit C ("Deed"). 3 ESCROW Within 10 days from the date hereof the Parties will deliver signed escrow instructions to Chicago Title Company, 750 North Palm Canyon Drive, Palm Springs, California, ("Escrow Holder"), a copy of which instructions are attached hereto, marked Exhibit D ("Escrow Instructions"), and by this reference made a part hereof. Escrow fees shall be paid entirely by The Trust. The escrow instructions shall in all cases be consistent with the provisions of this Agreement, and in the event of a conflict between the terms of the escrow instructions and this Agreement,the terms of this Agreement shall prevail. At the close of escrow("Closing'),titles to the respective properties shall be conveyed by the duly executed and acicaowledged Deeds. 4 PHASE I HAZARDOUS MATERIALS REPORT Within 45 days from the date hereof, The Trust, at its sole expense, shall cause Earth Systems Southwest to inspect each of the properties and to issue its Phase l Report ("Hazardous Materials Report")to each of the Parties. In the event the Hazardous Materials Report indicates that either property is likely to have been contaminated by any Hazardous Material, either Party may terminate this agreement and the Escrow. 5 TITLE At closing, each of the Parties shall convey to the other party title to their respective property, free and clear of any and all liens, encumbrances, covenants, conditions, restrictions, easements, rights of way and assessments except those acceptable to both parties set forth on a preliminary title reports to be furnished by The Trust, at its sole cost and expense, within ten days after approval of this Agreement by the City. In the event the preliminary title report with respect to either exchange property contains any lien, encumbrance, covenant, condition, restriction, easement,right of way or assessment which is unacceptable to the party which is to receive that property in the exchange,that Party may terminate this agreement and the Escrow. 6 REPRESENTATIONS AND WARRANTIES Each of the Parties makes the following representations and warranties to the other which shall be true as of the date hereof and as of the Closing: A This ,Agreement and all agreements, instruments and documents herein provided to be executed or to be caused to be executed by each Party on or before the Closing will be duly authorized, executed and delivered by and binding upon that Party and enforceable in accordance with its terms; and each Party has the autbority to enter into this Agreement and to consurmnate the transactions herein provided. B Neither Party has (i) received notice of any outstanding violation of or been charged with the violation of any material legal requirement,restriction, condition, covenant or agreement affecting its Property or the marketing, construction, development, use, operation, maintenance or management of its Property which has not been cured, or (ii)been served in any unresolved litigation relating to its Property or the marketing, construction, development, use, operation, maintenance or management of the Property. Neither Party has actual knowledge of any actions, sluts, claims or proceedings, governmental or otherwise, pending or threatened against its Property or any portion thereof C Neither Parry is a party to any certificate, instrument, contract, deed of Trust, mortgage, indenture, agreement, covenant or other restriction, and there is no provision in any Trust Agreement, Charter or law, or any judgment, order,writ, injunction, or decree of any court, governmental body or arbitrator, which would prohibit or otherwise be breached or violated by the entering into, execution, delivery or performance by either Party of this Agreement or the consummation of the transactions contemplated hereby. D Both Parties acknowledge that they are required to disclose if their respective Properties lie within the Following natural hazard areas or zones: (i) a special flood hazard area designated by the Federal Emergency Management Agency (California Civil Code Section 1102,17); (ii) an area of potential flooding (California Government Code Section 8589.4); (iii) a very high fire hazard severity zone (California Government Code Section 51183.3); (iv) a wild land area that may contain substantial forest fire risks and hazards (Public Resources Code Section 4136); (v) an earthquake fault zone (Public Resources Code Section 2621.9); or(vi) a seismic hazard zone (Public Resources Code Section 2694). However, because the purpose of this transaction is to assure that neither the City Property nor the Trust Property are developed, each Party hereby waives this disclosure requirement. Neither Party shall have any responsibility .for matters not actually known to it. In addition, neither Party has knowledge of any hazardous materials or hazardous substances on its Property. E There are no service,maintenance, employment, supply, management or other agreements affecting either Property, either oral or written, which will remain in effect after the Closing. F There are no leases, licenses or other agreements permitting the use or occupancy of either Property which will remain in effect after the Closing. There are no persons entitled to use or 5 occupy either Property or any portion thereof by reason of any easements by prescription or necessity. G Neither Party has: (a) made a general assignment for the benefit of creditors; (b) filed any voluntary petition in bankruptcy or suffered the filing of an involuntary petition by its creditors; (c) suffered the appointment of a receiver to take possession of all or substantially all of its assets; or(d) suffered the attachment or judicial seizure of all, or substantially all, of its assets. H Neither Party has granted any person any right to acquire all or any portion of its Property, including, without limitation, any development, mineral or air rights relating to its Property_ I Neither Party has actual knowledge of: (a) any condemnation,pending or threatened, of its Property or any portion thereof, including any right of access to its Property; (b) any government plans for public improvements that might result in a special assessment against its Property; or, (c) any underground or above-ground storage tanks on its Property. J The exchange of the Properties and the performance of each of the Parties' obligations hereunder are not subject to any requirement to obtain any approval or consent of any other governmental agency or third party. K Neither Party is a"foreign person" within the meaning of Section 1445(0(3) of the Internal Revenue Code. L Except as otherwise expressly provided in this Agreement including this Article 6, neither Party makes any representation, warranty or guarantee whatsoever with respect to its Property, or any aspect thereof. Each Party acknowledges and agrees that if the exchange occurs, except as otherwise provided herein, it will be acquired"AS -IS," and each Party's decision in that regard shall be based on its own independent investigation and analysis of the Property. M The representations,warranties and covenants made by each Party in this Article 6 shall survive the Closing and the recordation of the deed. 7 BROKERAGE COMMISSION Each party represents to the other that no real estate brokers are involved in this transaction. 8 MISCELLANEOUS PROVISIONS A Unless otherwise provided herein, any notice, tender or delivery to be given hereunder by either party to the other may be effected by personal delivery or by registered or certified mail, postage prepaid,return receipt requested, and shall be deemed communicated as of the date of mailing. Mailed notices shall be addressed as set forth below but each parry may change its address by written notice in accordance with this paragraph: CITY: CITY OF PALM SPRINGS 3200 E Tahgtutz Canyon Way Palm Springs, CA 92262 Attn: City Manager Trust BARNEY TRUST PO Box 45348 Los Angeles, CA 90045 Copy to: Paul T. Selzer, Esq. 777 E. Tahgtitz Canyon Way Suite 328 Palm Springs, CA 92262 B This instrument contains the entire agreement between the parties relating to the matters contained within this Agreement. Any oral representations or modifications concerning this instrument shall be of no force or effect excepting a subsequent modification in writing signed by all parties. C In the event of any litigation or arbitration between the parties hereto, arising out of or relating to this Agreement, or the breach thereof, the prevailing party shall be entitled, in addition to such other relief as may be granted, to a reasonable sum as and for attorneys' fees in such litigation or arbitration which shall be determined by the court in such litigation or arbitrator or in a separate action brought for that purpose. b This Agreement shall be binding upon and shall inure to the benedt of the respective heirs,personal representatives, successors and assigns of the parties hereto. E This Agreement is entered into in the State of California, concerns real property located within this state, and all questions concerning the validity, interpretation and performance of any of its terms or provisions or any of the rights or obligations of the parties hereto shall be governed by and resolved in accordance with the laws of the State of California. F Each party hereto agrees to execute and deliver such other and further documents and perform such other acts as shall be necessary to effectuate the purpose of this Agreement. G Any waiver of the breach of any covenant, condition or promise contained wilhin this Agreement shall not be deemed a waiver of any succeeding breach of the same or of any other covenant, condition or promise set forth within this Agreement. No waiver shall be deemed to have been given unless given in writing and in compliance with the Notices section set forth above. (2 H Time is expressly deemed to be of the essence of this Agreement and each and every provision hereof. I Thi s Agreement may be executed in one or more counterparts, and bear the signature of each Party on a separate counterpart, each of which when so executed and delivered shall be deemed an original but all of which taken together shall constitute but one and the same instrument. Signatures on facsimile copies when so delivered shall be deemed to be originals and shall operate in the same manner as original counterparts. 7 All representations and warranties set forth in this Agreement and all provisions of this Agreement shall survive Closing and be£illy enforceable thereafter. K This Agreement does not confer any rights or remedies upon any person, fine or entity other than the Parties and their respective successors and permitted assigns_ L No officer or employee of the City shall have any financial interest, direct or indirect, in thus Agreement, nor shall any such officer or employee participate in any decision relating to the Agreement which affects its financial interest or the financial interest of any corporation,partnership or association in which he is, directly or indirectly, interested, in violation of any State statute or regulation. The Trust warrants that it has not paid or given and will not pay or give any third party any money or other consideration for obtaining this Agreement. M If either party to this Exchange Agreement is required to initiate or defend or aid a party to any action or proceeding in any way connected with this Exchange Agreement, the prevailing party in such action or proceeding, in addition to any other relief which may be granted, whether legal or equitable, shall be entitled to reasonable attorney's fees, whether or not the matter proceeds to judgment_ [signature page appended] IN WITNESS WHEREOF,the parties hereto have executed this Agreement and made it effective as of the day and year first above written. ATTEST: CITY OF PALM SPRINGS, a municipal corporation By: By: City Clerk City Manager REVIEWED AND APPROVED BURI,E WILLIAMS & SORI NSEN, LLP By: David J. Aleshire, Esq. City Attorney GARRY C. KIEF Trustee, The Barney Trust. ';7 g EXHIBIT A LEGAL DESCRIPTION TRUST PROPERTY The West half of government lots 2 and 3, in Section 33, T3S,R4E, San Bernardino Base and Meridian, according to the official plat thereof, in the County of Riverside, State of California. EXHIBIT B LEGAL DESCRIPTION CITY PROPERTY The southeasterly 45 acres of that certain parcel conveyed to the City of Palm Springs by Jeanette Stewart and Bank of California, NA, recorded July 11, 1977 in the official records of Riverside County, California as instrument number 129589, excluding therefrom all property currently used as a road and picnic area. A more precise legal description shall be completed and attached as a substitute legal description upon approval by Gary Kief, Trustee and Doug Evans, Director of Planning and Zoning of the City of Palm Springs, as evidenced by their signature on such substituted Exhibit. ExFIIBIT C FORM OF DEED TRUST TO CITY RECORDING REQUESTED BY AND WHEN RECORDED RETURN TO: ' THE CITY OF PALM SPRINGS 3200 E. Tahquitz Canyon Way _Palm Springs, CA 92262 MAIL 'FAX STATEMENTS TO: DOCUMENTARY TRANSFER TAX $ Computed on the consideration or value of Property conveyed, OR THE CITY OF PALM SPRINGS 3200 E. Tahquitz Canyon Way Computed on the consideration or value less Palm Springs, CA 92262 Liens or encumbrances remaining at time of sale. Sipaturc or Declarant or Agent determining tax-Firm Name GRANT DEED FOR A VALUABLE CONSIDERATION, receipt of which is hereby acknowledged, Garry Kief, Trustee of the Barney Trust, Grantor, hereby GRANTS to THE CITY OF PALM SPRINGS, CALIFORNIA, A MUNICIPAL CORPORATION the real property in the City of Palm Springs, County of Riverside, State of California, described as: [LEGAL DESCRIPTION.....ALL WITHIN THE CITY OF PALM SPRINGS, CALIFORNIA CONTAINING APPROXIMATELY 45 ACRES MORE OR LESS] This grant deed is made in consideration of the covenant of the GRANTEE that the property conveyed hereby shall, with the exception of trails, paths, fences or walls, he retained exclusively as natural open space and be managed and maintained as such, in perpetuity. Dated By: Garry Kief, Trustee of the Barney Trust STATE OF CALiFORNIA ) ss COUNTY OF RIVERSIDE ) On before me, personally appeared o personally known to me - or - 0 proved to me on the basis of satisfactory evidence, to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signatore(s) on the instrument the person(s), or Elie entiry upon behalf of which the persons(s) acted, executed the instrument. Witness my hand and official seal. (This area for official notarial seal) SIGNATURE OF NOTARY MAIL TAX STATEMENTS AS DIRECTED ABOVE 7 R City of Palm Springs Office of the City Clerk 3200 Tahquitz Canyon Way Palm Springs, California 92262 Tel. (760) 323-8204 • Fax. (750) 322-8323 • TDD (760) 864-9527 CERTIFICATE OF ACCEPTANCE THIS IS TO CERTIFY that the interest in real property conveyed by GRANT DEED dated: from, GARRY KIEF, TRUSTEE OF THE BARNEY TRUST Grantor, to the City of Palm Springs, a municipal corporation and charter city, Grantee, is hereby accepted by the City Clerk of said City of Palm Springs, on this_day of 2003, pursuant to authority granted by the City Council of said City, by Resolution No. made on the day of , 2003, and the Grantee consents to recordation thereof by the City Cleric, its duly authorized officer. Dated at Palm Springs, California, this_day of , 2003 City Clerk (seal) Post Office Box 2743 • Palm Springs, California 92263-2743 a MI `� EXHIBIT C FORM OF DEED CITY TO TRUST RECORDING REQUESTED BY AND 'W15EN RECORDED RETURN TO- Selzer,Ealy,Flentphill&Blasdell,LLP 777 E. Tahquitz Canyon Way, Suite 328 Palm Springs, CA 92262 MAIL TAX STATEMENTS TO: DOCUMENTARY TRANSFER TAX S Computed on the consideration or value of Property conveyed, OR The Barney Trust c/o Garry Kief Computed on the consideration or value less P. 0. Box 45348 Liens or encumbrances remaining at time of Los Angeles, CA 90045 sale. Signature of Declarant or Agent determining tan-Firm Name GRANT DEED FOR A VALUABLE CONSIDERATION, receipt of which is hereby acknowledged, The City of Palm Springs, California, a Municipal Corporation, Grantor, hereby GRANTS to GARRY KIEF, TRUSTEE OF THE BARNEY TRUST, the real property in the City of Palm Springs, County of Riverside, State of California, described as: [LEGAL DESCRIPTION--_ALL WITHIN THE CITY OF PALM SPRINGS, CALIFORNIA CONTAINING APPROXIMATELY 45 ACRES MORE OR LESS] This grant deed is made in consideration of the covenant of the GRANTEE that the property conveyed hereby shall, with the exception of trails, paths, fences or walls, be retained exclusively as natural opetl space and be managed and maintained as such, in perpetuity. Dated By: City of Palm Springs STATE. OF CALIFORNIA ) ss COUNTY OF RIVERSIDE ) On before me, personally appeared El personally known to me - or - ❑ proved to me on the basis of satisfactory evidence, to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signatuse(s) on the instrument the person(s), or the entity upon behalf of which the persons(s) acted, executed the instrument. Witness my hand and official seal. (This area for official notarial seal) SIGNATURE OF NOTARY MAIL TAX STATEMENTS AS DIRECTED ABOVE EXHIBIT D ESCROW INSTRUCTIONS SEE ATTACKED ESCROW INSTRUCTIONS FROM CI-IICAGO TITLE COMPANY ay�e � RESOLUTION NO. OF THE CITY COUNCIL OF THE CITY OF PALM SPRINGS,CALIFORNIA,APPROVINGAN EXCHANGE AGREEMENT WITH THE BARNEY TRUST OF LOS ANGELES, CALIFORNIA, EXCHANGING 45 ACRES OF CITY-OWNED LAND FOR 45-ACRES OF TRUST- OWNED LAND, WITH RESTRICTIONS ON THE FUTURE DEVELOPMENT OF BOTH PARCELS WHEREAS,the Bamey Trust is the owner of that certain unimproved real property located in the City of Palm Springs, County of Riverside, State of California, consisting of approximately forty five (45) acres which Real Property is more particularly described in attached Exhibit A ("Trust Property"); and WHEREAS, the City is the owner of that certain unimproved real property located in the City of Palm Springs, County of Riverside, State of California, consisting of approximately forty five(45) acres which Real Property is more particularly described in attached Exhibit B ("City Property"); and WHEREAS, the City Property consists of a portion of a parcels designated as Parcel 1 on Exhibit B. The deed which conveyed the Parcel to the City provides: "This gift deed is hereby granted to the City of Palm Springs subject to said property being retained for park or permanent open space purposes;" and WHEREAS, in addition to the Trust Property,the Trust owns additional real property which is located adjacent to the City Property ("Adjacent Trust Property'), improved as a residential complex, and the Trust wishes to assure that the City Property shall always and in perpetuity remain in an undeveloped and natural state; and WHEREAS, notwithstanding the provisions of the deed as hereinabove set forth and the intention of the City to maintain the City property in an undeveloped and natural state, the Trust desires further assurances that the City Property will not be developed, and to that end is willing to convey the Trust Property to the City in exchange for the City Property in the fashion set forth hereinafter to assure that neither the Trust Property nor the City Property shall be developed and that those properties shall remain as permanent open space; and WHEREAS, the City also wishes to ensure that both the City Property and the Trust Property shall always and in perpetuity remain in an undeveloped and natural state; and WHEREAS, the Trust deems this exchange to be in the best interest of the Trust because it assures that the City Property will, in perpetuity, remain in an undeveloped and natural state, to the benefit of the Adjacent Trust Property. NOW THEREFORE BE IT RESOLVED by the City Council of the City of Palm Springs, that: SECTION 1. The City, pursuant to its authority under Government Code Section 37350,� � to acquire and dispose of property for the common benefit, deems the exchange of property between the City of Palm Springs and the Barney Trust to be in the best interest of the City because it results in 45 additional acres within the City being held in an undeveloped and natural state for the long term benefit of the City and its residents without expense to the City. SECTION 2. In consideration of the mutual covenants and conditions contained therein, the Exchange Agreement between the Barney Trust of Los Angeles, California, and the City of Palm Springs, in a form approved by the City Attorney, is hereby approved. SECTION 3, The City Manager or his designee is hereby authorized to execute all contracts,deeds,declarations,or other documents related to the Exchange Agreement. ADOPTED this day of , 2003. AYES: NOES: ABSENT: ATTEST: THE CITY OF PALM SPRINGS, CALIFORNIA By City Clerk Mayor REVIEWED & APPROVED AS TO FORM