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HomeMy WebLinkAboutH9 1811 W Durston Disposal 9-25-06 Commission Memorandum REPORT TO: Honorable Mayor and City Commission FROM: Debbie Arkell, Acting City Manager for Chris Kukulski, City Manager SUBJECT: Determination whether or not Real Property owned by the City is no longer needed, Lot 24, Block A, Maple Terrace Subdivision, 1811 West Durston MEETING DATE: September 25, 2006 BACKGROUND: On May 2, 2005, the Commission authorized the City-Manager to Sign a Buy-Sell Agreement for Lot 24, Block A, Maple Terrace Subdivision, as the property had recently come on the market, and the purpose of the property was found to be in the city’s best interest with regard to the pending improvements on Durston Road. The subject property is adjacent to a small city-owned parcel, and by owning both parcels, we could better control the street construction and future access issues. The City’s offer was accepted, and the City attained ownership of the property on May 25, 2005. The property is zoned R-1, Residential Single-household, Low Density, as is the city-owned property to the west and the vacant lot to the east. The property to the north is zoned R-O, Residential-Office, and is occupied by a multi-story office building. A 3 bedroom, 2 bath home sits on the subject property, and the home has been rented since shortly after our purchase to various renters. Aspen Properties property management is under contract with the City to manage the property. The home is currently rented on an $875/month month-to-month lease, of which the city generally nets approximately $750 (after management expenses and utilities). Access to the home has been difficult, at best, in the last few weeks, due to construction. Future access to the existing garage will likely not be feasible. Over the past year, I have received inquiries from two adjacent property owners asking if the City was planning to sell the property. Both parties were advised of the process that must be followed to dispose of City-owned real property, and that until the construction was nearing completion and we knew the amount of land needed from this property for existing and future right-of-way, that decision would not be made. One party is interested in using the property for parking for their adjacent office. The other party did not reveal potential plans for the property. Lot 24, Block A, Maple Terrace Subdivision (1811 West Durston Road) September 25, 2006 Page 2 The extent of the subject property and of the adjoining city property that will be needed for the current Durston Road improvements, as well as for any potential future improvements, will soon be finalized. Documents will then be drafted to retain all necessary right-of-way. Once that is accomplished, the city’s intended use of the property will be completed. At that time, we will also be able to determine if the city-owned property to the west of the subject property has a need to the city, and if not, this process will be followed for the potential disposition of that property as well. All City Department Heads and key Division Heads were asked if they could think of any use for the structure or property for any reason. I asked that they “think outside the box” and to consider uses such as sub-stations, satellite offices, records storage, etc., while keeping in mind the fact that access to the property may be difficult at certain times due to its proximity to the North 19th/Durston Road intersection. There was some discussion of the use of the home for an “on- call apartment”, where personnel who were “on-call” for emergency services could stay overnight, rather than going to their homes. On-call personnel are currently not required to stay within city limits, but are required to be available and able to respond should an emergency occur. Other than that, no suggestions for future use of the property were made. The property could continue to be rented for housing, but when the final determination is made as to the extent of property needed for right-of-way, we expect the garage to not be accessible to vehicles. The driveway would have to be relocated as far east as possible, which would remove a considerable amount of front yard area. Staff has considered selling the home, with the condition that the home be removed from the property, and we have been told the re-location of a brick structure is quite expensive. Even with the home gone, use of the property independent from other lots, will be limited, due to the size and shape of the lot. Section 2.5.040 of the Bozeman Municipal Code requires the Commission to determine if property owned by the City is no longer needed, and if not, whether the property may be sold by bid, auction with reserve, or negotiated sale. Notice of this public hearing to make such a determination was published in the Bozeman Daily Chronicle on September 10 and 17, 2006. RECOMMENDATION: Conduct public hearing. 1. If the Commission determines the subject property is not necessary to the conduct of City business, find that the property may be sold by bid, auction with reserve, or negotiated sale. If such findings are made, direct staff to have the property appraised as required in Section 2.05.060, BMC, and proceed with the sale of the subject property under the provisions of Chapter 2.05, BMC, once the extent of needed right-of-way is finally determined. 2. As suggested by the City Commission Lot 24, Block A, Maple Terrace Subdivision (1811 West Durston Road) September 25, 2006 Page 3 FISCAL EFFECTS: The cost of the required appraisal is unknown at this time, but will be an expense of the city. The minimum sale price will be determined based on the appraised value of the land for its intended use. The original purchase price of the property should be returned to the fund used to purchase the property (G.O. Transportation Bond). Any funds in excess of that may be credited to any account that is in the best interest of the City. Once the property reverts to private ownership, property taxes and assessments will be generated. Respectfully submitted, ___________________________ ______________________________ Debra H. Arkell, Director of Public Services Chris A. Kukulski, City Manager Report compiled on September 13, 2006 Copy to: Shane Lutey, via email Steve Homec Bob Murray, Staff Engineer File 634a(iii)