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The South Pasadena City Council is set to take big steps tonight in its quest for a satisfactory final disposition for the remaining 68 properties in town that Caltrans acquired for its ill-fated 710 freeway extension project. Meantime, Caltrans is revving up to start offering the properties for sale.
In a single vote, the Council is set to release a request for qualifications from prospective partners with whom to develop a community land trust–a legal entity that promotes affordable housing by decoupling land and housing costs; a request for proposals to inspect and prepare repair estimates for the properties; and a deal with the South Pasadena Preservation Foundation (SPPF) to inspect the vacant historic Caltrans houses for “character-defining features.” The Council will also approve a $5,850 extension to its $75,000 contract with CivicStone LLC, the city’s principal consultant in SB 381 implementation process.
Caltrans has indicated it expects to start selling the homes this year, starting with unoccupied units. Occupied property sales in lots of 20 each will be released every few weeks starting as early as this summer. Occupants with tenancies exceeding 25 years will get first crack.
The city gained greater authority in the process under last year’s passage of SB 381, the city-sponsored bill facilitated by Sen. Anthony Portantino. It gave the city a higher priority to purchase the properties, authorized it to do so at Caltrans’ original acquisition prices and resell at fair market value and requires it to use what are expected to be the considerable proceeds for the creation of affordable housing. The city intends to resell under conditions preventing displacement of existing tenants, supporting tenants interested in ownership and preserving the houses’ historic elements.
SPPF President Mark Gallatin, vice-chair of the Cultural Heritage Commission, said the city has been working cooperatively with the group on SB 381 implementation since November—he particularly praised City Manager Arminé Chaparyan and Community Development Director Angelica Frausto-Lupo. A draft of the MOU to leverage SPPF’s inspection skills was provided early this month. The city agreed to few minor changes but at SPPF’s meeting Monday, April 18, the draft was rejected by the majority of the 13-member board.
Gallatin said the board “agreed with the spirit of the MOU but not necessarily with its letter.” It was too late to remove the MOU from the Council’s agenda, but Gallatin said he spoke with Frausto-Lupo, who readily agreed the MOU portion of tonight’s SB 381 implementation item could be postponed until the Council’s next meeting in May.
One of SPPF’s interests is securing assignment as administrator of preservation covenants for the historic Caltrans homes. SPPF already holds seven such assignments for houses previously owned by Caltrans in South Pasadena. The covenants authorize it to make annual inspections and guarantee preservation of historic features.
SB 381 provides for the disposition of 68 properties—two vacant lots, 46 occupied properties and 20 unoccupied residential structures, but the draft SPPF MOU deals only with the eight unoccupied properties that are already listed on state or national historic registers. But the city’s own inventory of historic properties lists 26 of the Caltrans properties. SPPF would like a shot at examining all 66 of the SB 381 Caltrans houses. Gallatin said Caltrans, impressed by the qualifications of SPPF’s board members, has been receptive to the idea of making it the preservation covenant assignee for any homes with historic elements.
Gallatin also noted preservation covenant assignees are eligible for stewardship fees—something SPPF did not avail itself of for six of the seven convents it already has. But the fees are only available for resources listed on state or national registers, and Gallatin wants time to talk to Caltrans about that. He said Caltrans historic preservation staff were in town last month. The one-time Caltrans stewardship fees can be as much as $30,000 per house. “That would be a huge windfall for us,” he said. Over the last three tax years for which it has reported, SPPF has averaged total revenues of $28,836.
“The bottom line,” he said, “is I am very confident we can come back with a revised MOU in May that has been ratified by our board.”
But there is still considerable opposition to the SB 381 process, said Joanne Nuckols, a SPPF board member. She cited a petition signed last year by 66 opponents of SB 381, who demanded that the city not involve any outside housing-related entities to manage the properties; immediate sale of the unoccupied homes to “qualified owner-occupied buyers”; “homeownership for current Caltrans tenants residing in their homes”; and no “lot splits or zone changes.”
Nuckols also noted Caltrans’ gave very little time to review the “emergency” rules it proposed for implementation of SB 381. The state released a 16-page draft of complex provisions March 28; the Council’s two-member Ad Hoc SB 381 Implementation Committee reviewed them March 31; the city submitted comments April 4; and the state approved the rules April 7. The city’s comments sought a few clarifications and removal of some sales restrictions.
“There are a lot of balls in the air pertaining to SB 381,” Nuckols said. “It is critical for the City Council to take time to know what it is doing before moving into action.”
As the city’s closed agenda for tonight also reflects, the city is in the middle of a lawsuit with Caltrans over its separate desire to purchase a multi-unit Caltrans property at 626 Prospect. The staff report is silent on any impact the rules may have on that suit, or how either may be affected by a recent ruling in another in 710 lawsuit in which Caltrans 710 corridor tenants won the right to purchase their homes at Caltrans’ original acquisition price.
