Successor Agency Properties and Long-Range Property Management Plan

Under 2011 Redevelopment Dissolution Laws, all former Redevelopment agencies in California were required to sell their asset, retire all debt and dissolve. Any net unrestricted proceeds earned by the Successor Agencies prior to dissolution are to be distributed to the taxing entities (e.g., County, school districts, and special districts) on a pro rata basis.

Ownership of the properties owned by the former Redevelopment Agency of the City of Santa Clara) was assumed by the Santa Clara Successor Agency.

Per State Dissolution Laws, Santa Clara Successor agency prepared a Long-Range Property Management Plan (LRPMP) which was subsequently approved by the Santa Clara Oversight Board and the California Department of Finance. The LRPMP directs the Successor agency to sell the properties subject to the LRPMP expeditiously and for a maximum value pursuant to Health and Safety Code Section 34181(a).

The Surplus Land Act (SLA) and the Surplus Land Declaration

Effective January 1, 2020, Assembly Bill (AB) No. 1486 amended the SLA by prohibiting local agencies from commencing negotiations over the sale or lease of surplus property prior to sending notices about available, surplus local public land to designated entities (Eligible Entities), including:

• California Department of Housing and Community Development (HCD).
• Any local public entity within the jurisdiction where the surplus local land is located.
• Developers who have notified HCD of their interest in developing affordable housing on surplus local land.

Importantly, AB 1486 now requires a local agency to declare property as “surplus land” before taking any actions to dispose of such property, including issuance of a NOA or request for proposals (RFP). The declaration must be made by the legislative body of the local agency.

Following the declaration of surplus, the Successor Agency must provide a NOA to the Eligible Entities for specified uses, including affordable housing, parks and recreation, and schools. An Eligible Entity desiring to purchase or lease the surplus land for any of the purposes described above must notify the Successor Agency in writing of its intent to purchase or lease the land within 60 days after the receipt of the Successor Agency’s notification of intent to dispose of the land.

If the Successor Agency receives notice of interest from any Eligible Entities, the SLA mandates a 90-day negotiation period with any designated entities that submit timely offers. If no notice of interest is received or negotiations do not result in a disposition, the City may proceed with disposing of the land. The SLA does not require the Successor Agency to dispose of surplus land at less than fair market value. (In fact State Dissolution Laws require that the Successor Agency dispose of the property at the highest value.)  However, the SLA requires that, at a minimum, any subsequent development of 10 or more residential unites on the site must designate at least 15 percent of units as affordable.

To receive notices for new NOAs, interested developers must notify the State's HCD of their interest in receiving notices by completing HCD's Developer Interest Survey.

For more information regarding the SLA, please visit the State's Surplus Lands webpage.

Notices of Availability and Noticing Period

Per the SLA, after City Council issues the surplus declaration, staff will issue NOAs to the Eligible Entities, beginning a minimum 60-day noticing period. Staff will release NOAs.  During the 60-day noticing period, the SLA restricts Successor Agency discretion in negotiating with potential buyers, prioritizing NOA responses, and limiting project design features. State law requires the Successor Agency to first respond exclusively to Eligible Entities and to give priority to proposals that provide at least 25 percent of a project’s housing units affordable to lower-income households (at or below 80 percent of area median income). If multiple proposals provide at least 25 percent affordable units, State law requires prioritizing the project with the greater number of affordable units. If multiple proposals contain the same number of affordable units, staff are required to prioritize projects that provide the deepest average level of affordability for its affordable units. The Successor Agency is also prevented from negotiating terms that would prevent residential use (even if not permitted by the existing zoning), reduce density below what is allowed by zoning, or impose design requirements that would have a substantial adverse effect on viability for affordable housing.

Surplus Property 

There are two Successor Agency parcels remaining to be sold: the Techmart parcel and the Santa Clara Hyatt Regency parcel.

Relevant Documents and Information

October 19, 2021 – City Council Staff Report

For More Information

For questions, contact the City Manager’s Office at (408) 615-2210 or email Jennifer Acuña at jacuna@santaclaraca.gov