REPORT TO SHASTA COUNTY BOARD OF SUPERVISORS

BOARD MEETING DATE:  August  21, 2018
CATEGORY:  Consent - General Government-1.

SUBJECT:

Approve a Second Amendment to the Property Acquisition Agreement between Shasta County and the State of California Judicial Council of California.

Supervisorial District No. :  All

DEPARTMENT CONTACT:  Terri Howat, County Chief Financial Officer, 530-225-5561

STAFF REPORT APPROVED BY:  Terri Howat, County Chief Financial Officer

RECOMMENDATION

Approve and authorize the Chairman to sign a Second Amendment, effective date of signing, to the July 8, 2011 Property Acquisition Agreement with the State of California Judicial Council of California and the State Public Works Board (State) to subordinate the County's interest in a use restriction as a condition to the issuance of lease revenue bonds to finance the new courthouse construction.

SUMMARY

N/A

DISCUSSION

Pursuant to the July 8, 2011 Property Acquisition Agreement (PAA), the County conveyed to the State fee title to the real property commonly known as 1525 Court Street and certain real property adjacent to 1525 Court Street (the "Public Safety Building Site").  The PAA contains language essentially requiring that the property the County of Shasta transferred to the State be used by the Superior Court for Court purposes (the "Use Restriction").  Bond Counsel for the State is of the opinion that this "Use Restriction" gives the County an interest in the Public Safety Building Site.

In order for the State to obtain financing for the Shasta County New Redding Courthouse, the State Public Works Board requires that the County of Shasta subordinate its interest in the property at 1525 Court Street and certain real property adjacent to 1525 Court Street to the bond financing agreements.   

The subordination agreement will not extinguish the County’s interest in the Use Restriction.  It will place it behind the interests in the Public Safety Building Site created by the bond financing agreements.  The County has been informed that the bond financing agreements will also have requirements that the site be used as a courthouse.

ALTERNATIVES

If the amendment does not go into effect then, in all likelihood, construction of the Shasta County New Redding Courthouse will not move forward.

OTHER AGENCY INVOLVEMENT

County Counsel has reviewed this Second Amendment and approved it as to form.

FINANCING

No General Fund impact.