The Transportation Agency for Monterey County is proposing to extend passenger rail service from Santa Clara County south to Salinas. The service is scheduled to start with two round trips, expanding to up to six round trips as demand warrants. The property in question is 0.09 acres located at 30 W Market Street in the City of Salinas, California, known as Monterey County Assessor’s Parcel No. 002-172-001. The parcel will be needed for the parking lot planned for the area of the Salinas Rail Station.

The Transportation Agency Board previously approved a Purchase and Sale Agreement with Frank Favaloro to purchase 30 West Market Street, Salinas on April 27, 2016.  Escrow on the property closed on February 22, 2017. Prior to the purchase of the property by the Agency, Mr. Favaloro has been renting a portion of the building (addressed 14 Station Place) to Olivia's Cafe for $1,600 per month in rent.  The Transportation Agency Board approved a short-term lease agreement at the December 7, 2016 meeting to allow Olivia's Cafe to remain on-site while efforts to relocate the business continue.

The Transportation Agency's real estate acquisition consultants, Overland, Pacific & Cutler, have been working with the owners of Olivia's Cafe since April 2016 to find suitable relocation sites for the business. Any person, household, business, farm, or nonprofit organization displaced by a public project may be entitled to relocation benefits if they are in occupancy of the property being acquired at the time of the initiation of negotiations. Persons and entities displaced by a project and determined to be eligible for benefits are classified as a “displacee.” Displaced persons must be fully informed of their rights and entitlements to relocation assistance and payments provided by the Uniform Act.

While Overland, Pacific & Cutler have provided a number of potential relocation sites in Salinas, Monterey, Seaside, and Watsonville to Olivia's Cafe, the owners have not selected one of the potential sites to move the business. As such, with the Agency taking ownership of the property, the proposed short-term lease agreement provides additional time for the relocation team to continue working with Olivia's on a replacement site. Agency staff originally anticipated that escrow on the property would close by December 31, 2016.  However a lien against the property that was never cleared by Mr. Favaloro delayed the close of escrow until the matter was resolved.  As such, the lease agreement with Olivia's Cafe is set to expire as of April 30, 2017 based on the original close of escrow date.  However, with the Agency not taking possession of the property until February 22, 2017, Agency staff is seeking to extend the term of the lease agreement until June 30, 2017 to allow for continued efforts to relocate the business and cover the legally-mandated 90-day notice to vacate requirement.

For this agreement, the Agency is seeking to continue the current market-rate monthly payments of $1,600 per month for the term of the lease agreement.  Olivia's Cafe would also be responsible to payment of the utilities and maintaining insurance on the property.  Given the short-term nature of the agreement, no modifications to the property or extensions of the agreement are contemplated.