HomeMy WebLinkAbout2682 Policies and Procedures for Disposition of Surplus PropertyOrdinance No. 2682
AN ORDINANCE OF THE CITY OF PORT TOWNSEND ADOPTING A NEW
CHAPTER 3.44, DISPOSITION OF SURPLUS PROPERTY, OF THE PORT
TOWNSEND MUNICIPAL CODE, ESTABLISHING POLICIES AND PROCEDURES
FOR THE DETERMINATION THAT PROPERTY IS SURPLUS TO THE CITY'S
NEEDS, AND PROVIDING POLICIES AND PROCEDURES FOR THE
DISPOSITION OF SURPLUS PROPERTY
WHEREAS, the City of Port Townsend owns public property, acquired for various public
needs and purposes. The City Council, acting in a legislative, proprietary capacity, has the
discretion and authority to determine the best management practices for the City's public property,
including making determinations from time-to-time that public property should be leased or sold.
In making these decisions, the Council acts as stewards of public property, obligated to consider
the long-term needs and interests of the public; and
WHEREAS, Washington law requires that the City follow certain procedures prior to
disposing of certain properties, including requirements set forth in Chapters 39.33 and 35.94
RCW. It is the intent of this Ordinance to establish procedures and policies to govern the
disposition of public property in accordance with Washington law, and also to establish locally-
adopted policy criteria for the City Council to consider prior to making any legislative decision
to dispose of property acquired for utility purposes, as well as property of significant dollar value;
and
WHEREAS} in enacting this Ordinance, the City Council intends that all legislative
decisions to declare public property "surplus," and the disposition of surplus property, shall be
subject to public notice and, to the greatest extent possible, conducted in public meetings, with
the opportunity of the public to comment upon decisions to dispose of public property. The
Council intends to adopt policy criteria by which the public may measure the Council's decisions
to dispose of public property, thereby ensuring that the decisions to dispose of public property are
made in accordance with the best interests of the public; and
WHEREAS, the City Council's Parks, Recreation and Properties Committee has
conducted a series of public meetings for the review and consideration of this Ordinance. The
Committee has considered public comments made at the Committee meetings. Additionally, on
January 19, 1999, the City Council held a duly noticed public hearing to accept public comments
and testimony concerning this Ordinance. Based upon the information presented to Council,
including public comments, the Council finds that this Ordinance is necessary and in the best
interests of the public,
NOW, THEREFORE, the City Council of the City of Port Townsend does ordain as
follows:
Section 1. A new Chapter 3.44, "Disposition of Surplus Property," of the Port Townsend
Municipal Code is hereby adopted and shall read as follows:
Chapter 3.44
Disposition of Surplus Property
3.44.010
3.44.020
3.44.030
3.44.040
3.44.050
Purpose
Def'mitions
Policies for determining that property is surplus
Procedures for determining that property is surplus
Process for disposition of surplus property
3.44.010 Purpose
The City of Port Townsend owns and operates real and personal property needed for the
effective provision and management of municipal services, including but not limited to parks,
recreation and utility services. The City Council recognizes that unlike private enterprises, the
City owns and manages public property for many purposes, including many activities which do
not produce revenues or profits for the City. It is the policy of the City of Port Townsend to
provide the best possible stewardship and management of municipal assets in the best interests of
the citizens of Port Townsend and for the enhancement and protection of the natural and built
environment. In furtherance of this policy, the City Council shall make ail decisions that real
property is surplus to the City's needs in accordance with Chapter 39.33 RCW and Chapter 35.94
RCW, and based upon established criteria, and only after seeking public review and comment
regarding all proposed determinations that property which is subject to this chapter is surplus to
City needs. This chapter requires that the City Council shall hold a public hearing prior to
disposing of real property and all real and personal property acquired by the City for utility
purposes.
3.44.020 Defmitious
"Property" as defined by this chapter means all real property (real estate) owned in fee
simple title by the City of Port Townsend, located both within the City's incorporated municipal
boundaries and outside City limits. "Property" shall also mean all personal property (non-real
estate) with an estimated value in excess of $5,000 and all real and personal property originally
acquired for public utility purposes. "Property" shall not include public streets, alleys and rights
of way which are subject to vacation and disposition in accordance with Chapter 12.20 PTMC.
"Disposition" means the lease or sale of property as defined in this Chapter 3.44 PTMC.
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3.44.030 Policies for determining that property is surplus
A. Real property. The City Council shall review, every three years, or other regular
basis, the City ownership of real property. The intent of this review shall be to ensure the
optimum u 'tflization of the capital assets of the City of Port Townsend. All determinations by the
City Council in accordance with this Chapter 3.44 shall be within the discretion of the City
Council, acting within its legislative, proprietary authority as provided in Chapter 35A. 11 RCW.
Determinations that real property is surplus to City needs shall be made after holding a duly-
noticed public hearing, and shall be based, at a minimum, upon the City Council's consideration
of the following criteria:
1. Real property should perform a valuable public function. In making this
determination, the Council should consider both current use and any foreseeable future use.
Property may serve a valuable public function if the property provides both tangible and intangible
returns to the City, including but not limited to: preservation of sensitive natural habitat;
stormwater or flood management and control; current or future utility-related needs; passive or
active open space and recreation enjoyment; implementation of comprehensive plan goals and
policies; future investment potential; etc.;
2. If the property is determined to serve a valuable public function, the City
Council should determine if this function could be served more effectively, and/or more
appropriately, by. another property in current City ownership;
3. If the property is determined not to serve a valuable public function, the
City Council should determine if a potential future use, or other COmpelling reason exists to retain
this prope/ty, based upon the following non-exclusive criteria:
(a) The Council should determine if the property has been identified in
the Port Townsend Comprehensive Plan or any functional or subarea plans, as having potential
future value to the City;
Co) The Council should request that the City Manager and/or department
heads review and identify whether there are any previously unidentified potential future uses of
the property;
(c) The Council should determine whether there are contractual or other
resWaints on the title to the property which would limit or preclude sale. If such restraints exist,
upon consultation with the city attorney, the Council should determine the difficulty in removing
such restraints;
(d) The Council should determine whether the net future value of the
current appreciation, is greater than what would be reasonably expected
property, based upon
through fund returns;
(e) The Council should determine whether the return on investment
would be greater through management of the property, and/or property development for City use,
rather than through sale; and
(f) The Council should determine all tax consequences of the decision
to retain the property versus a decision to declare the property to be surplus and dispose of the
property.
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B. Personal property.
1. Public utility property. Upon the recommendation of the public works
director or designee, and after conclusion of a duly-noticed public hearing, the City Council shall
consider whether personal property owned by the City and originally acquired for utility purposes
is obsolete or not required for providing continued utility service.
2. Other personal property. Upon recommendation of any department director
or designee, the City Council shall consider whether any personal property with estimated valUe
in excess of $5,000 is obsolete or is otherwise no longer needed for public purposes. For personal
property with an eStimated value less than $5,000, the Council may dispose of the property
without first holding a public hearing. A public hearing shall be required prior to the Council
making a decision to dispose of personal property with an estimated value in excess of $5,000.
3.44.040 Procedures for determining that property is surplus -- Real and utility
property.
A. All final determinations of the City Council to declare real property, real and
personal property acquired for utility purposes, and personal property with an estimated value in
excess of $5,000 as surplus to the City's needs and the sale of surplus property shall be undertaken
only after conclusion of the public process as provided in this section 3.44.040 PTMC; provided,
however, this chapter 3.44 PTMC shall not be construed as limiting the authority of the City
Council to conduct executive sessions as authorized by Washington law:
1. Prior to making any final determinations that property owned by the City
is surplus to the City's needs, and prior to negotiating any conveyance, the City shall hold a public
hearing. The public hearing shall be held prior to undertaking any brokerage or real estate agent
listing arrangements;
2. At least ten days, and not more than twenty-five days before the hearing,
the City shall publish a public notice in display advertising form, setting forth the date, time and
place of the public hearing, published at least once in the official newspaper. The City shall also
circulate a news release;
3. The public hearing notices shall identify the property by an easily
understood description (i.e. not exclusively by metes and bounds legal description), and shall
describe any proposed use of the land involved, if any is contemplated;
4. After the public hearing, if the City Council determines that the property
is surplus to the City's needs, the City Council shall adopt a resolution making findings that the
property is surplus to the City's needs, .and finding conformity with the adopted policies of the
City which govern disposition of surplus property. The resolution shall state the estimated fair
market value of the property. With real property, the resolution shall state the appraised value;
and
5. The resolution should state the terms and conditions for the actual
disposition of the property which the Council finds to be in the best public interest.
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3.44.050 Process for disposition of surplus property
A. CommerciallY reasonable sale or conveyance. The actual sale or other conveyance of
property shall be commercially reasonable. A commercially reasonable sale or other conveyance
shall be an "arms length" arrangement, for the fair market value of the property. A commercially
reasonable sale or conveyance may be by auction, private sale, trade-in as a component of
replacement of obsolete property for new property, sealed bids, or by broker or agent listing.
City employees and elected officials shall be prohibited from purchasing or otherwise acquiring
any interest in any City surplus property.
B. Intergovernmental transfers of property. For all intergovernmental transfers of property,
the Council shall make its determination that the property is surplus to the City's needs in
accordance with this chapter, and all transfers shall be made pursuant to chapter 39.44 RCW, or
such other state statute as may be applicable. With all intergovernmental transfers of property,
the City Council shall consider'conveying the property subject to a restrictive covenant which
describes the allowed intended use of the property and prohibits the acquiring municipality from
conveying the property to non-governmental parties or entities.
C. Utility property. In the event property declared surplus was originally acquired for public
utility purposes, the revenues must be used for utility-related purposes, related to the utility which
funded the original purchase, or in the event there shall remain no such utility, said funds shall
be otherwise distributed as allowed by state law. All revenues from the sale of utility property
shall be deposited in the appropriate utility account or fund. Proceeds from the sale of capital
property shall be used for capital purposes.
D. Disposition of proceeds -- Non-utility property. Proceeds from the sale of non-utility
property shall be deposited and appropriated as determined by the City Council. Proceeds from
the sale of capital property shall be used for capital purposes.
E. Restrictive covenants. Prior to disposing of real property, the City Council shall consider
the need to impose restrictive covenants for the purpose of protecting important public interests,
including, but not limited to: preservation and protection of environmentally sensitive areas
identified on properties; stormwater control; open space protection; shoreline development use;
and other restrictions controlling land use to implement City policy or to ensure that the property
is used and developed in a manner which is compatible with neighborhood character.
F. Release and hold harmless agreement. Prior to disposing of any personal property, the
City shall require the transferee to execute an acknowledgment of risks, release and waiver and
hold harmless agreement, including a provision that the property is accepted "as is," without
express or implied warranties as to merchantability or fitness for any particular purpose. This
agreement shall be made on a form approved by the city attorney.
Section 2. ;~?,3kelalz[1.[~. If any clause,' sentence, paragraph, section or part of this
Ordinance or its application to any person or circumstance is held to be invalid or unconstitutional
by a court of competent jurisdiction, such order or judgment shall not affect the validity or
constitutionality of the remainder of any part of this Ordinance. To this end, the provisions of
each clause, sentence, paragraph, section or part of this law are declared severable.
5 Ord. 2682
This ordinance shall take effect and be in force five days after the date of its publication
in the manner provided by law.
Read for the first, second, and third times and passed by the City Council of the City of
Port Townsend, Washington, at a regular meeting thereof, held this 19th day of January, 1999.
Ju[~cCulloch, Mayor
Attest:
Approved as to Form:
~ ttomey
01/22/99 [99-02] [PTMC]
ca§Ord{cta-44.doc} Ord. 2682
6 Ord. 2682