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HomeMy WebLinkAboutVI (D) Discussion/ Action re: Land Acquisition Agrement with Logan Family Trust Agenda 8-19-97 Item VID FOLEY & LARDNER ATTORNEYS AT LAW SUITE 1800 A MEMBER OF GLOBALEX wl 111 NORTH ORANGE AVENUE WITH MEMBER OFFICES IN ORLANDO, FLORIDA 32801 BERLIN JACKSONVILLE TELEPHONE14071423-7656 BRUSSELS TALLAHASSEE FACSIMILE 14071 648-1743 DRESDEN TAMPA FRANKFURT WEST PALM BEACH MAILING ADDRESS: LONDON MILWAUKEE POST OFFICE BOX 2193 PARTS MADISON SINGAPORE CHICAGO ORLANDO.FL 32802-2193 STUTTGART WASHINGTON, D.C. ���T7�T7� TAIPEI MEMORANDUM VM TO: The Honorable Mayor and City Commissioners of the City of Ocoee FROM: Paul E. Rosenthal , Esq. , City Attorney � V DATE: August 12 , 1997 RE: Relocated Public Works Facility: Condemnation of Lands Owned by Blanche E. Logan, as Trustee of the Logan Family Trust Mr. Corwin has previously presented to the City Commission information regarding the proposed purchase of commercial property located at 370 Enterprise Street for the purpose of relocating the Public Works Department . An appraisal was obtained indicating a market value of $358 , 000 . On May 20, 1997, the City Commission authorized the Staff to continue purchase negotiations . This has resulted in a Land Acquisition Agreement with Blanche E. Logan, as Trustee for the Logan Family Trust, which is the owner of the property. During the course of negotiations it was discovered that the Trust acquired title to the property by a Deed from the Internal Revenue Service which had taken the property from Ronald Allen Trucking Company, Inc. Due to the complexity of the IRS procedures, title standards in Florida preclude the issuance of title insurance based upon an IRS tax deed unless there is a judicial determination of the validity of such transfer of title or a quit claim deed from the taxpayer. In the case at hand, the Trust could not obtain a quit claim deed. Additionally, the Trust was not agreeable to pursuing a judicial determination. As part of the negotiations, the Staff proposed that the City would condemn the property provided there was an agreement addressing various issues, including the purchase price and environmental matters. This approach provides the following benefits : (1) it is a mechanism by which the City can obtain title free and clear of any claims of Ronald Allen Trucking Company, Inc. by naming them as a party to the condemnation action; (2) it allows E S T A B L I S H E D 18 4 2 for the acquisition of the property in a timeframe more consistent with the schedule for relocating the Public Works Department; and (3) it provides the Trust with certain tax advantages allowing reinvestment of the proceeds paid by the City. In order to acquire the property it is necessary for the City Commission to adopt the attached Resolution No. 97-08 authorizing the condemnation of the property. Subject to certain matters discussed below, the City would pursue a "quick take" which should allow for the obtaining of title within 90 days from the filing of the action. In connection with the condemnation action, the Trust has executed the attached Land Acquisition Agreement. The highlights of the Agreement are as follows : (1) The City will initiate condemnation proceedings at the City' s expense. (2) The Trust has agreed that it will not contest the City' s determination of the value of the property which has been agreed upon as being $375, 000 . The Trust further agreed not to seek any of its attorneys' fees and costs . (3) The Trust is responsible for the payment of the $10, 000 deductible under the Florida Department of Environmental Protection' s Florida Petroleum Liability Insurance and Restoration Program (the "Program" ) and will assign to the City all of its rights thereunder. The Trust has already incurred the expense of qualifying the site for participation in the Program. (4) The Trust will pay the cost of an owners title insurance policy. (5) The City will obtain a survey and a Phase I Environmental Assessment . (6) The Trust is responsible for the payment of all brokerage commissions . (7) The City may dismiss the suit at any time prior to acquiring title. As a result of the Land Acquisition Agreement, the City should have an uncontested condemnation proceeding. However, there is a possibility that other parties may litigate the entitlement to receive the monies paid by the City into the registry of the Court, but any such disputes should not affect the ability of the City to obtain title or the ultimate purchase price paid by the City. The proposed acquisition price exceeds the appraised value by $17, 000 (or approximately 5%) . This payment in excess of the appraised value is offset by certain other expenses to be incurred -2- by the Trust as set forth above and the agreement not to seek reimbursement of attorneys' fees and costs . The City Commission has previously been advised that the property has petroleum contamination. Attached hereto is a memorandum from Tom Maurer of my office dated June 4 which discusses in detail the petroleum contamination and the opportunity to have the Program fund the cleanup in an amount not greater than $300, 000 . Also attached is an approval letter from the FDEP. The City has obtained a proposal from Universal Engineering Sciences to conduct a Phase I Environmental Assessment for a fee of $1, 500 and in connection therewith to determine the estimated cost of cleanup. If the estimated cleanup costs are projected to exceed the funding available from the Program, then the City would discontinue its efforts to acquire the property. If, as anticipated, the estimated cleanup costs will be covered by the Program, then the City will proceed. While the condemnation, title and environmental issues make this transaction somewhat unusual , the combination of the City' s condemnation powers and the availability of funding through the Program create the opportunity to address the problems which might otherwise preclude the acquisition of the property. Mr. Corwin is providing you with a separate memorandum regarding the reasons why the staff is recommending that the City acquire the property as the site for the relocated Public Works facility. Additionally, Mr. Shira is providing you with a separate memorandum regarding agreements with respect to the obtaining of the Phase I Environmental Assessment and a survey of the property. The City staff recommends that the City proceed with this acquisition through the exercise of its condemnation powers. RECOMMENDATION: It respectfully is recommended that the City Commission (1) approve the Land Acquisition Agreement with Blanche E. Logan as Trustee of the Logan Family Trust, and (2) adopt Resolution No. 97-08 authorizing the condemnation of the real property owned by the Logan Family Trust located at 370 Enterprise Street, Ocoee. encl . C:\WP51\DOCS\PER\PUBWORK.MEM 18/1 2/97 1 1 8S008'PER Jed -3-