Coversheet


Agenda Item 5.


TRANSPORTATION AGENCY FOR MONTEREY COUNTY *Memorandum*

To:	Board of Directors
From:	Michael Zeller, Director of Programming & Project Delivery
Meeting Date:	December 7, 2016
Subject:	Salinas Rail Extension - Property Acquisition Update

RECOMMENDED ACTION:
RECEIVE an update on the proposed property acquisitions for the Salinas Rail Extension Kick-Start project.

SUMMARY:
The Transportation Agency for Monterey County is proposing to extend passenger rail service from Santa Clara County south to Salinas. The Salinas Rail Extension Kick Start project requires acquisition of parcels near the Salinas Rail Station in order to construct an extension of Lincoln Avenue, improve parking and access to the rail station, and to build a train layover facility.

FINANCIAL IMPACT:
The Salinas Rail Extension project includes funding for consultant work related to right-of-way acquisition. Staff proposes to use Traffic Congestion Relief Program or Proposition 116 bond funds for the property acquisitions. The total project budget is estimated at $70 million; the right-of-way phase is estimated to cost $24.1 million, which includes relocation costs.

DISCUSSION:

For over the past year, the Transportation Agency's real estate acquisition consultants, Overland, Pacific & Cutler, have been negotiating with the property owners near the Salinas Rail Station to purchase the properties for the Salinas Rail Extension Kick-Start project. The project involves the extension of rail service from Santa Clara County, and would involve the potential purchase of these properties to allow for the construction of an extended Lincoln Avenue and parking for the rail station. In total, there are nine properties that are the subject of acquisition for this phase of the Kick Start project.

In 2015, the Transportation Agency retained an independent, accredited appraisal firm familiar with local property values to appraise the subject properties. The property owners were contacted by the appraiser to provide any information about improvements and any special features that may affect the value of their property. After a property inspection, the appraiser completed an appraisal report, which included the determination of the property's fair market value and information upon which the fair market value is based. The agency then contracted with a review appraiser to verify the appraisal report and the determination of fair market value. With the approved appraisal report, the Agency then made a written offer to purchase the properties in the fall of 2015.

With the written offer letters submitted to the property owners for all nine properties, the Transportation Agency also notified the property owners of their rights in the property acquisition process. This includes the option for an owner to obtain their own appraisal of the property in negotiating the fair market value with the Agency. At the time of making its initial offer, the Agency must offer to reimburse the owner the reasonable costs of an independent appraisal of the property, not to exceed $5,000.

Since the initial offer letters were sent, the Agency's acquisition consultant has been continually in contact with the property owners to finalize the purchase of the properties. To date, the Agency has negotiated a settlement on one property - 30 West Market Street - with escrow set to close on December 31, 2016. The remaining properties are in varying stages of negotiation, and the Agency's acquisition consultant is continuing to reach out to the property owners to seek a negotiated settlement on all of the properties. Currently, due to the length of time that negotiations have been undergoing, the Agency is in the process of updating the appraisal reports to re-verify fair market value on the properties and will submit revised offer letters to each of the property owners. Agency staff willl provide an update on the acquisition process during the meeting.