Housing development manager Elsa Brown recommends City acquisition of two Habitat parcels for $1

Elsa Brown, development manager in the Housing Department, presented a resolution asking the City Council to approve a settlement agreement for the City of Oxnard to acquire two adjacent vacant parcels at 5230 and 5208 Cypress Road from Habitat for Humanity Ventura County for a conveyance payment of $1 in exchange for forgiveness of two promissory notes totaling $1,060,000.

Brown said the properties were acquired by Habitat in 2009 using two CDC loans — agreement A-7202 ($300,000) and agreement A-6940 ($760,000) — and that the promissory notes and deeds of trust were reassigned to the city after state redevelopment agencies were dissolved. "The proposed resolution approves the settlement agreement and the grant deed for the city to acquire the property from Habitat for a conveyance payment of $1," Brown said.

Brown told the council that Habitat had requested in about 2019 to amend the loan agreements to develop 28 affordable rental housing units on the site, but that design, entitlements and construction funding have not been completed or secured. Given the elapsed time, she said Habitat agreed to the settlement that allows the city to acquire the property rather than pursue repayment or non-judicial foreclosure.

Key terms listed in Brown's presentation include the city's acceptance of forgiveness of the two promissory notes (combined $1,060,000), the city's agreement to pay transaction fees and related closing costs (estimated up to $10,000), and a contractual option for the city to terminate the settlement if it disapproves any title exceptions. Brown said that following council adoption and execution of the settlement agreement, escrow would be opened to transfer the property to the city within 90 days and staff would return to council to seek authorization to surplus the property in accordance with the State Surplus Land Act (SLA).

Brown explained the SLA process the city would follow: the property must first be offered for the development of affordable housing; if no interest or negotiations fail the city may offer the property for other uses including market-rate housing; and if a market-rate proposal for 10 or more homes is proposed the SLA requires at least 15% of units reserved for households earning at or below 80% of area median income.

On environmental review, Brown reported that on April 4, 2024 the Planning Commission adopted Resolution No. 2024-07, finding the acquisition is consistent with the Oxnard 2030 General Plan and is not a project under CEQA, citing CEQA Guidelines sections 158061 B3 and 15378 B5 because the acquisition would not result in a direct or reasonably foreseeable indirect physical change to the environment.

Brown also stated there is sufficient funding in the Fiscal Year 2025-2026 Housing Department General Fund operating budget to fund acquisition-related costs. She closed by recommending that the City Council adopt a resolution approving the settlement agreement, accept the grant deed, and authorize the Housing Director or designee to execute any documents necessary to complete the acquisition. The transcript records the presentation and recommendation; it does not record a motion, a second, or a council vote.