HomeMy WebLinkAbout09-18-2018 Item 15 Miossi Brothers La Cuesta Ranch Open SpaceMeeting Date: 9/18/2018
FROM: Derek Johnson, City Manager
Prepared By:Robert A. Hill, Interim Deputy Director, Office of Sustainability
SUBJECT:MIOSSI BROTHERS LA CUESTA RANCH OPEN SPACE ACQUISITION
RECOMMENDATION
Approve a Resolution (Attachment A):
1. Authorizing the acquisition in fee simple title of approximately 266 acres of unimproved real
property that is a portion of the Miossi Brothers La Cuesta Ranch, located in unincorporated
San Luis Obispo County, for open space conservation and passive recreation purposes
(Attachment B); and
2. Authorizing the expenditure of $1,000,000, plus ancillary closing costs, from the City of San
Luis Obispo’s Open Space Acquisition Funds towards the purchase of the property; and
3. Authorizing the use of $200,000 from the City of San Luis Obispo’s Open Space Acquisition
Funds, if needed, that will be reimbursed by the State of California’s Habitat Conservation
Fund pursuant to the terms of that Grant Agreement; and
4. Authorizing the acceptance of a donation of $100,000 from the Forbes Family via The
Community Foundation of San Luis Obispo County in accordance with the City’s Donation
Acceptance Policy; and
5. Authorizing the Mayor to execute a Certificate of Acceptance for the real property interest
concurrent with the close of escrow for said transaction, and the City Manager to execute any
and all documents necessary to consummate the transaction; and
6. Authorizing the Mayor to execute a Deed Restriction, Access Easement Agreement,
Telecommunications Easement Agreement, and a Grazing Lease in forms subject to the
approval of the City Attorney.
DISCUSSION
Background
The Miossi family originally immigrated to the United States from the Canton Ticino,
Switzerland, from 1864 to 1870 and finally settled in San Luis Obispo County with the
establishment of the La Cuesta Ranch in 1917, among other ranch holdings in the area. The third
and fourth generations of the family continue to operate and steward the land, and desire to
maintain the agricultural and open space condition of the property. With prior City Council
direction, staff has been in continual dialogue with the Miossi family for over five years,
resulting in the completion of a purchase and sale agreement in March 2018.
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The purchase and sale agreement provides for the fee simple acquisition of a 266-acre portion of
the Miossi Brothers La Cuesta Ranch, located at the headwaters of San Luis Obispo Creek in the
northern portion of the City’s Greenbelt. The purchase and sale agreement also anticipates,
through its recitals, the completion of a conservation easement in the future for most of the
balance of the nearly 1,400-acre ranch that the City and Miossi family will work on as a
subsequent “phase II” project.
Conservation Values and Project Benefits
The Cuesta Canyon area has been a long-standing priority for the City’s Greenbelt conservation
efforts since at least 1995 (e.g. A Vision for Sustainability in San Luis Obispo: Recommendations
of the Environmental Quality Task Force and the series of Saving Special Places reports). The
subject property represents the keystone piece of the conservation vision set forth for the Cuesta
Canyon area to protect this area’s rich biodiversity and the headwaters of San Luis Obispo Creek
at a landscape level. Permanent protection of the property would provide recovery benefits to a
suite of rare plants and vegetative assemblages, as well as known habitat and migration corridors
for steelhead trout, mountain lion, and California black bear. The acquisition will also allow for
linking passive recreation trails connecting Poly Canyon to the West Cuesta Ridge area where
outstanding views of the Pacific Ocean can be gained and enjoyed.
In the time leading up to the City’s purchase agreement, a portion of the land to be acquired by
the City had been listed for sale on the open market. A sale to another private buyer could
potentially have led to the development of the three legal lots within the subject property, each
with recorded certificates of compliance, as rural-ranchettes.
General Plan Conformity
California Government Code Section 65402 requires that the Planning Commission make a
finding that an acquisition of real property for open space purposes, such as contemplated herein,
conforms with the City’s General Plan. The Planning Commission met on Augu st 22, 2018 to
review and consider this item, and found that the proposed acquisition is consistent with goals,
programs, and policies found in the Conservation and Open Space Element (COSE)of the City’s
General Plan, including:
COSE Goal 8.1: Secure and maintain a healthy and attractive Greenbelt around the urban
area, comprised of diverse and connected natural habitats, and productive agricultural land
that reflects the City’s watershed and topographic boundaries.
COSE Program 8.7.1(D): Protect Open Space Resources.
The City will take the following actions to protect open space, and will encourage
individuals, organizations, and other agencies to take the same actions within their areas of
responsibility and jurisdiction: D. Acquire land and interests in land for open space,
pursuant to City Open Space Guidelines and acquisition priorities.
COSE Policy 9.1.1 (A): Preserve natural and agricultural landscapes.
The City will implement the following policies and will encourage other agencies with
jurisdiction to do likewise: A. Natural and agricultural landscapes that the City has not
designated for urban use shall be maintained in their current patterns of use.
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Transaction Details
The City has entered into a purchase and sale agreement with Miossi Brothers La Cuesta Ranch,
Inc. for the purchase of the 266-acre property interest. The purchase and sale agreement has a
six-month term, and the parties have entered into an escrow that is set to close on or about
September 26, 2018, should Council approve the recommendation. The agreed upon purchase
price is $1,300,000, which is the appraised value for the property interest.
The appraisal was completed for the City by the firm Schenberger, Taylor, McCormick, and
Jecker (STM&J) as of February 12, 2018. The City also secured a third-party appraisal review
prepared by Hawkes Real Estate Appraisal, which concludes that STM&J’s “…report is
complete, consistent, and adequate, meeting all of the relevant standards, and that the opinions of
value are valid and re liable.” Additional purchase and sale agreement terms that were considered
as part of the appraisal evaluation include the following rights that will be retained by the sellers:
1.) an access easement through the property for emergency and maintenance purposes consistent
with historic uses; 2.) an easement and leasehold rights to an existing cellular
telecommunications facility located on a small corner of the property; and, 3.) the lease-back of
grazing rights for a period of ten years, with option to renew.The City has also agreed to install
new fencing and gates on the south side of the property prior to opening the land to the public to
prevent trespass to the remaining portion of the Miossi Brothers La Cuesta Ranch.
The layered funding strategy for the project relies on existing City Open Space Acquisition
Funds that have attracted two other funding accommodations, as follows:
Project Funding Sources Status Amount
City of San Luis Obispo, Open Space Acquisition Funds,
Local Revenue Measure
Budgeted $1,000,000
State of California, Habitat Conservation Fund, Grant In contract $200,000
Forbes Family, Private Donation Awarded $100,000
TOTAL $1,300,000
The City Council authorized the Habitat Conservation Fund (HCF) grant application and Grant
Agreement with the State of California on September 15, 2015 via Resolution No. 10665 (2015
Series). The HCF grant program is administered by the California Department of Parks and
Recreation’s Office of Grants and Local Services. An important condition of t he HCF Grant
Agreement is that the City shall record a permanent Deed Restriction concurrent with the Grant
Deed by which the City will take title to the property that will ensure the conservation purposes
of the HCF grant under the California Wildlife Protection Act of 1990. Funds for HCF
acquisition projects are typically disbursed directly to escrow in accordance with their published
Grant Administration Guidelines (2012), although City staff understands from their program
staff that there is a possibility, due to their staffing resources and timing considerations, that the
City may need to provide bridge funding in the amount of $200,000 to complete the transaction
until reimbursement is received from the State of California as obligated under the Grant
Agreement. As an abundance of caution, staff is seeking authority to provide this bridge funding
accommodation as part of the recommendation.
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The City is also exceptionally fortunate to be receiving a charitable donation of $100,000 from
the Forbes Family, which will be facilitated by The Community Foundation of San Luis Obispo
County. This level of private philanthropy is considered by staff to be a strong testament to how
deep ly citizens within the community value and cherish the City’s Greenbelt Pr otection Program.
The acceptance of a gift of this size requires City Council approval under the City’s Donation
Policy found in the Financial Management Manual, Section 760, and adopted by City Council
Resolution No. 8965 (1999 Series); staff is seeking authority to receive this donation as part of
the recommendation.
The Greenbelt Protection Program has a long history of matching City funds with other grants
and private donations for voluntary transactions, as well as dedications of land as conditions of
approval associated with land use entitlements. In the past two years since staff has reported to
the City Council on the status of the City’s Greenbelt, new additions including the subject are as
follows:
Property Acreage City Funds Grants / Donations Total Value
Waddell Ranch 154 $100,000 $1,000,000 $1,100,000
South Hills, MASP 1 71 -$177,500 $177,500
Righetti Hill, OASP2 40 -$100,000 $100,000
Miossi La Cuesta Ranch 266 $1,000,000 $300,000 $1,300,000
TOTAL 531 $1,100,000 $1,577,500 $2,677,500
Due Diligence and Title Review
A Phase I Environmental Site Assessment (ESA) was completed for the City by the firm Haro
Environmental as of June 8, 2018. The purpose of seeking a Phase I ESA is conduct due
diligence relative to potential liability to the City as the prospective property owner under the
federal Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA)
and other applicable environmental law. No “Recognized Environmental Concerns” (RECs)
were found, and the report concludes, “Because we have no evidence indicating that the Site has
been impacted by hazardous materials or petroleum products, no additional assessment appears
warranted at this time.”
The City has also received and reviewed a Preliminary Title Report for the property from First
American Title as of March 21, 2018 and has determined that there are no liens, judgements,
defaults, or exceptions to fee simple title that represent a title defect that would be legally
problematic or prior easements that would be deleterious to the conservation values and purposes
of the acquisition. Notable prior easements include easements for Stagecoach Road, U.S. 101,
telecommunications, and both natural gas and petroleum pipelines. Both the appraisal and the
Phase I ESA evaluated and considered these easements in their findings and conclusions.
CONCURRENCE
The City Attorney’s Office has reviewed the transaction and documentation described herein and
concurs with the recommendation.
1 Margarita Area Specific Plan (MASP), Tract 2428. Base donation value of $2,500 per acre.
2 Orcutt Area Specific Plan (OASP), Tract 3063. Base donation value of $2,500 per acre.
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ENVIRONMENTAL REVIEW
Acquisition of the subject property is categorically exempt from the provisions of the California
Environmental Quality Act (CEQA) because it involves “acquisition of lands for fish and
wildlife conservation purposes including (a) preservation of fish and wildlife habitat… and (c)
preserving access to public lands and waters where the purpose of the acquisition is to preserve
the land in its natural condition” (§15313), and because it involves the “acceptance of … fee
interests in order to maintain the open space chara cter of the area” (§15317).
Once acquired, it is anticipated that Natural Resources Program staff will prepare a Conservation
Plan consistent with the Conservation and Open Space Element of the City’s General Plan
(2006), the Conservation Guidelines for Open Space Lands of the City of San Luis Obispo
(2002), and the City’s Open Space Regulations (San Luis Obispo Municipal Code, chapter
12.22). An environmental review and determination will be conducted prior to any management
activities or property improvements that would constitute a Project under CEQA definitions
(§21065).
FISCAL IMPACT
Sufficient funds for the City’s portion of the transaction in the amount of $1,000,000 are
available in the following sources:
City Funding Sources Available Remaining
Local Revenue Measure –Open Space CIP $427,093 $0
Open Space Protection Fund CIP –Land Acquisition $290,000 $0
Open Space Protection Fund –Fund Balance3 $594,643 $311,736
TOTAL $1,311,736 $311,736
Long-term operating and maintenance costs are expected to be relatively modest, and the
property would be incorporated into the City’s existing maintenance regime articulated in the
Open Space Maintenance Plan (2015) and implemented by the City’s Ranger Service. As the
subject property is located in unincorporated San Luis Obispo County, the City would be subject
to annual property tax, albeit at a restricted property tax rate due to the deed restrictions required
by the HCF Grant Agreement that will ensure the property remains in open space uses. Property
taxes for City-owned open space lands located in the County of San Luis Obispo are handled
through the Natural Resources Program’s operating budget. Longer -term property
improvements and enhancements would be developed in detail through the Conservation Plan
process and included in future two-year Financial Plans for Cit y Council consideration.
3 Remaining funds include in-lieu fees collected as part of the Airport Area Specific Plan (AASP) fee program that
are designated for that purpose.
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ALTERNATIVES
The City Council could:
1. Request additional information or clarification from staff prior to taking action on the
recommendation.
2. Continue the item with specific direction if more information or discussion time is required
before taking action, although this is not recommended as the transaction described herein is
consistent with prior City Council direction and there are time sensitivities associated with
the expected close of escrow on or about September 26, 2018.
3. Deny the recommendation.
Attachments:
a - City Council Resolution
b - Acquisition Maps
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R ______
RESOLUTION NO. ________ (2018 SERIES)
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN LUIS
OBISPO, CALIFORNIA AUTHORIZING THE ACQUISITION OF A
PORTION OF THE MIOSSI BROTHERS LA CUESTA RANCH
PROPERTY IDENTIFIED AS ASSESSOR PARCEL NOS. 070-241-013;
073-231-008; 073-271-013; AND 073-341-003 (PORTION) TOTALING
APPROXIMATELY 266 ACRES IN UNINCORPORATED SAN LUIS
OBISPO COUNTY
WHEREAS,the City of San Luis Obispo has adopted policies for protection,
management, and public use of open space lands in the Conservation and Open Space Element of
the City of San Luis Obispo’s General Plan, and on August 22, 2018 the City’s Planning
Commission made General Plan Consistency Determination pursuant to Government Code
Section 65042; and
WHEREAS,the City of San Luis Obispo manages twelve open space areas totaling
approximately 3,750 acres, and now desires to acquire an approximately 266-acre portion of the
Miossi Brothers La Cuesta Ranch for permanent open space conservation and passive recreation
purposes; and
WHEREAS, the fair market value for the 266-acre property interest as of February 12,
2018 is $1,300,000, as determined by an Appraisal Report prepared by the firm Schenberger,
Taylor, McCormick & Jecker; and
WHEREAS,the City of San Luis Obispo has reached an agreement to purchase the
property from the seller, Miossi Brothers La Cuesta Ranch, who will sell the property to the City
of San Luis Obispo for the appraised fair market value; and
WHEREAS,the City of San Luis Obispo has Open Space Acquisition Funds in the
amount of $1,000,000 and will have successfully received grant funding from the State of
California ’s Habitat Conservation Fund in the amount of $200,000 and a charitable donation of
$100,000 from the Forbes Family in order to consummate the transaction.
NOW, THEREFORE, BE IT RESOLVED by the Council of the City of San Luis Obispo
that:
1. Finds that acquisition of the 266-acre portion of the Miossi Brothers La Cuesta Ranch is
exempt from the provisions of the California Environmental Quality Act because it
involves “acquisition of lands for fish and wildlife conservation purposes including (a)
preservation of fish and wildlife habitat… and (c) preserving access to public lands and
waters where the purpose of the acquisition is to preserve the land in its natural condition”
(§15313), as well as because it involves the “acceptance of … fee interests in order to
maintain the open space character of the area” (§15317);
2. Finds that the subject property possesses high ecological and habitat value;
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Resolution No. _____ (2018 Series) Page 2
R ______
3. Finds that the use of referenced City funds, grant funds, and donated funds for acquisition
of the subject property is an appropriate expenditure;
4. Adopts the Council Agenda Report and Recommendation for this item;
5. Authorizes the acquisition in fee simple title of approximately 266 acres of unimproved
real property that is a portion of the Miossi Brothers La Cuesta Ranch, located in
unincorporated San Luis Obispo County, for open space conservat ion and passive
recreation purposes;
6. Authorizes the expenditure of $1,000,000, plus ancillary closing costs, from the City of
San Luis Obispo’s Open Space Acquisition Funds towards the purchase of the property;
7. Authorizes the use of $200,000 from the City of San Luis Obispo’s Open Space
Acquisition Funds, if needed, that will be reimbursed by the State of California’s Habitat
Conservation Fund pursuant to the terms of that Grant Agreement;
8. Authorizes the acceptance of a donation of $100,000 from the Forbes Family via the San
Luis Obispo County Community Foundation in accord ance with the City’s Donation
Acceptance Policy;
9. Authorizes the Mayor to execute a Certificate of Acceptance for the real property interest
concurrent with the close of escrow for said transaction, and t he City Manager to execute
any and all documents necessary to consummate the transaction.
10. Authorizes the Mayor to execute a Deed Restriction, Access Easement Agreement,
Telecommunications Easement Agreement and a Grazing Lease for the subject property
consistent with the terms of the Purchase and Sale Agreement and in forms subject to the
approval of the City Attorney.
Upon motion of _______________________, seconded by _______________________, and on
the following roll call vote:
AYES:
NOES:
ABSENT:
The foregoing resolution was adopted this 18th day of September 2018.
____________________________________
Mayor Heidi Harmon
ATTEST:
____________________________________
Teresa Purrington
City Clerk
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Resolution No. _____ (2018 Series) Page 3
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APPROVED AS TO FORM:
_____________________________________
J. Christine Dietrick
City Attorney
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City
of San Luis Obispo, California, this ______ day of ______________, _________.
____________________________________
Teresa Purrington
City Clerk
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Subject – 266 ac.
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