CC 07-09-2024 Item No. 1 Conference with real property negotitor_Written CommunicationsCC 07-09-2024
#1
Closed Session
Conference with real
property negotiator
Written Communications
From:Kitty Moore
To:City Clerk; Kirsten Squarcia; Lauren Sapudar
Subject:Written Communications Closed Session
Date:Tuesday, July 9, 2024 5:49:41 AM
Attachments:Brown Act Real Property Negotiations cal-a-g-op-10-206.pdf
Dear City Clerk,
Please include the attachment for written communications for today’s closed session City
Council meeting.
Thank you,
Kitty Moore
Councilmember
City Council
Kmoore@cupertino.org
(408) 777-1389
_________________________
________________________________________________________________________
TO BE PUBLISHED IN THE OFFICIAL REPORTS
OFFICE OF THE ATTORNEY GENERAL
State of California
KAMALA D. HARRIS
Attorney General
:
OPINION : No. 10-206
:
of : December 27, 2011
:
KAMALA D. HARRIS :
Attorney General :
:
MARC J. NOLAN :
Deputy Attorney General :
:
THE HONORABLE TONY RACKAUCKAS, ORANGE COUNTY DISTRICT
ATTORNEY, has requested an opinion on the following question:
What items may be discussed under the real-estate-negotiations exception to the
open meeting requirements of the Ralph M. Brown Act—an exception which states that
the legislative body of a local governmental agency may meet in closed session with its
real estate negotiator “to grant authority to its negotiator regarding the price and terms of
payment” for a proposed purchase, sale, exchange, or lease of identified real property?
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CONCLUSION
The real-estate-negotiations exception to the open meeting requirements of the
Ralph M. Brown Act permits discussion in closed session of: (1) the amount of
consideration that the local agency is willing to pay or accept in exchange for the real
property rights to be acquired or transferred in the particular transaction; (2) the form,
manner, and timing of how that consideration will be paid; and (3) items that are essential
to arriving at the authorized price and payment terms, such that their public disclosure
would be tantamount to revealing the information that the exception permits to be kept
confidential.
ANALYSIS
The open meetings law known as the Ralph M. Brown Act (Brown Act or Act)1
was adopted “to ensure the public’s right to attend the meetings of public agencies,”2 as
well as “to facilitate public participation in all phases of local government
decisionmaking and to curb misuse of the democratic process by secret legislation by
public bodies.”3 In enacting the Brown Act, the Legislature declared its intent as follows:
[T]he Legislature finds and declares that the public commissions,
boards and councils and the other public agencies in this State exist to aid
in the conduct of the people’s business. It is the intent of the law that their
actions be taken openly and that their deliberations be conducted openly.
The people of this State do not yield their sovereignty to the
agencies which serve them. The people, in delegating authority, do not
give their public servants the right to decide what is good for the people to
know and what is not good for them to know. The people insist on
remaining informed so that they may retain control over the instruments
they have created.4
1 Govt. Code §§ 54950-54963. All further references to sections of the
Government Code are by section number only.
2 Freedom Newsp. Inc. v. Orange Co. Employees Ret. Sys., 6 Cal. 4th 821, 825
(1993).
3 Cohan v. City of Thousand Oaks, 30 Cal. App. 4th 547, 555 (1994).
4 § 54950.
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As we have recently observed,5 the Brown Act both implements and furthers the
command set forth in the state constitution that “[t]he people have the right of access to
information concerning the conduct of the people’s business, and therefore, the meetings
of public bodies and the writings of public officials and agencies shall be open to public
scrutiny.”6
To effectuate these purposes, the Brown Act “requires that the legislative bodies
of local agencies . . . hold their meetings open to the public except as expressly
authorized by the Act.”7 While the Brown Act makes exceptions for specified matters8—
such as litigation,9 employee discipline,10 and negotiations for real estate transactions11—
these exceptions must be construed narrowly, in favor of the public’s right of access to
public information.12
The courts and this office are occasionally called upon to construe the parameters
of a given Brown Act exception. For example, in a recent opinion, we concluded that the
Act’s real-estate-negotiations exception does not justify a closed-session discussion of a
rehabilitation agency’s proposed loan to a private business.13 It had been argued that the
exception should apply because the proposed loan agreement (1) pertained to the use of
5 See 93 Ops.Cal.Atty.Gen. 51, 53-54 (2010).
6 Cal. Const. art I, § 3(b)(1); see Cal. Const. art. I, § 26 (“The provisions of this
Constitution are mandatory and prohibitory, unless by express words they are declared to
be otherwise.”).
7 §§ 54953, 54962; Kleitman v. Super Ct., 74 Cal. App. 4th 324, 331 (1999).
8 § 54957; Hamilton v. Town of Los Gatos, 213 Cal. App. 3d 1050, 1055 (1989).
9 § 54956.9.
10 § 54957.
11 § 54956.8.
12 Shapiro v. San Diego City Council, 96 Cal. App. 4th 904, 917 (2002); San Diego
Union v. City Council, 146 Cal. App. 3d 947, 954-955 (1983); see Rudd v. Cal. Cas. Gen.
Ins. Co., 219 Cal. App. 3d 948, 952 (1990) (statutory language “must be construed in the
context of the statutory framework as a whole, keeping in mind the policies and purposes
of the statute, and where possible the language should be read so as to conform to the
spirit of the enactment”); see also Cal. Const. art. I, § 3(b)(2) (legal authority “shall be
broadly construed if it furthers the people’s right of access, and narrowly construed if it
limits the right of access.”).
13 93 Ops.Cal.Atty.Gen. at 55-59.
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real property that the redevelopment agency was subleasing to the private business, (2)
referred to the sublease, and (3) incorporated certain terms of the sublease. After
analyzing the real-estate-negotiations exception, we concluded that the proposed loan
agreement did not “effectuate the acquisition, disposal, or modification of any property
rights under the existing sublease.”14 Whereas that opinion was tailored to the factual
circumstances underlying the question, here we have been asked to provide more general
guidance as to what kinds of matters may be discussed under the real-estate-negotiations
exception.
The starting point for our analysis is, necessarily, the language of the exception
itself, together with related provisions of the Brown Act.15 The real-estate-negotiations
exception provides, in relevant part, as follows:
Notwithstanding any other provision of this chapter, a legislative
body of a local agency may hold a closed session with its negotiator prior to
the purchase, sale, exchange, or lease of real property by or for the local
agency to grant authority to its negotiator regarding the price and terms of
payment for the purchase, sale, exchange, or lease.
However, prior to the closed session, the legislative body of the local
agency shall hold an open and public session in which it identifies its
negotiators, the real property or real properties which the negotiations may
concern, and the person or persons with whom its negotiators may
negotiate.16
The disclosure requirement set forth in the second quoted sentence mirrors a more
general Brown Act provision to the same effect.17 Both of these notice provisions
reinforce the Act’s general notice requirement that, “[a]t least 72 hours before a regular
meeting, the legislative body of the local agency, or its designee, shall post an agenda
containing a brief general description of each item of business to be transacted or
discussed at the meeting, including items to be discussed in closed session.”18
14 Id.
15 See Shapiro v. San Diego City Council, 96 Cal. App. 4th at 924.
16 § 54956.8.
17 § 54957.7(a) (“Prior to holding any closed session, the legislative body of the
local agency shall disclose, in an open meeting, the item or items to be discussed in the
closed session . . . .”)
18 § 54954.2(a) (emphasis added).
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With regard to the real-estate-negotiations exception, the Act provides that it is
sufficiently specific (or within a “safe harbor”) to describe the agenda item as follows:
CONFERENCE WITH REAL PROPERTY NEGOTIATORS
Property: (Specify street address, or if no street address, the parcel
number or other unique reference, of the real property under negotiation.)
Agency negotiator: (Specify names of negotiators attending the
closed session.) (If circumstances necessitate the absence of a specified
negotiator, an agent or designee may participate in place of the absent
negotiator so long as the name of the agent or designee is announced at an
open session held prior to the closed session.)
Negotiating parties: (Specify name of party (not agent).)
Under negotiation: (Specify whether instruction to negotiator will
concern price, terms of payment, or both.)19
The Act provides that, “in the closed session, the legislative body may consider only
those matters covered in its [agenda] statement.”20
An oft-cited commentator has described the purpose of the real-estate-negotiations
exception this way:
The need for executive [closed] sessions in this circumstance is
obvious. No purchase would ever be made for less than the maximum
amount the public body would pay if the public (including the seller) could
attend the session at which that maximum was set, and the same is true for
minimum sale prices and lease terms and the like.21
But, as we recently remarked, “[o]bvious though the need for it may be, this is still a
narrowly-crafted exception.”22 The question for us now is, how narrow?
19 § 54954.5(b).
20 § 54957.7(a).
21 Schwing, Open Meeting Laws § 7.76, 416-418 (1994); see also Kleitman v.
Super. Ct., 74 Cal. App. 4th at 324.
22 93 Ops.Cal.Atty.Gen. at 55; see Shapiro v. San Diego City Council, 96 Cal. App.
4th at 924 (real-estate-negotiations exception presents a “narrowly defined exception to
the rule of open meetings”).
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To aid our analysis, we employ well established rules of statutory interpretation.
Our primary goal is to ascertain the Legislature’s intent.23 In doing so, we look “first to
the words of the statute themselves, giving to the language its usual, ordinary import and
according significance, if possible, to every word, phrase and sentence.”24 Here, we are
particularly concerned with what is meant by the phrase “regarding price and terms of
payment for the purchase, sale, exchange, or lease,” which describes the authority that a
local agency may convey to its negotiator in a closed session.
Consulting the dictionary to give the statutory language its “usual, ordinary
import,”25 we believe that the word “price” in this context must be understood as the
amount of consideration given or sought in exchange for the real property rights that are
at stake.26 Further, we believe that the phrase “terms of payment” is best understood as
the form, manner, and timing upon which the agreed-upon price is to be paid—for
example, an all-cash transaction (either up-front or in installments), a seller-financed
mortgage, an exchange of property or property rights, or the like.27 It is significant that
the word “terms” is immediately modified by the words “of payment.” In our view, this
modification rules out any possibility that the statute is meant to authorize closed-session
discussions of any and all terms of the transaction as a whole.
23 See Freedom Newsps. Inc. v. Orange Co. Employees Ret. Sys., 6 Cal. 4th at 826.
24 Dyna-Med Inc. v. Fair Empl. & Hous. Commn., 43 Cal. 3d 1379, 1386-1387
(1987).
25 Dyna-Med, Inc., 43 Cal. 3d at 1387; see also Smith v. Selma Community Hosp.,
188 Cal. App. 4th 1, 30 (2010) (“In scrutinizing the words of a statute, courts generally
give them their usual, ordinary meaning, which in turn may be obtained by referring to a
dictionary.”).
26 “Price” in the economic sense is defined alternately as “the quantity of one thing
that is exchanged or demanded in barter or sale for another”; “the amount of money given
or set as the amount to be given as a consideration for the sale of a specified thing”; or
“the cost at which something is obtained or offered.” Webster’s New International
Unabridged Dictionary 1798 (3d ed., Merriam-Webster 2002).
27 As relevant here, “terms” are defined as “conditions,” as in “terms of a sale,” or
“credit granted on liberal terms of repayment.” Webster’s New International Unabridged
Dictionary 2358. “Payment” is defined simply as “the act of paying or giving
compensation,” or “something that is paid.” Id. at 1659.
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This view is bolstered by the legislative history of the exception,28 which reveals
that the phrase “terms of payment” came about after a series of amendments
incorporating other possible wordings. As introduced, the statute would have allowed a
county board of supervisors to conduct a closed session “with other persons for purposes
of negotiations for the purchase, sale or lease of property.”29 An early amendment
applied the exemption more broadly to “the legislative body of a local agency,” but
simultaneously narrowed the scope of discussion to a “meeting with [the local governing
body’s] designated negotiator to give instructions” concerning the “terms or price, or
both” of a specified real property transaction.30 Next, the language was amended to limit
the scope of discussion to only the “price” of the proposed transaction.31 A final
amendment settled on “price and terms of payment” for the particular purchase, sale,
exchange, or lease of real property.32 From this history, we can see that the Legislature
considered and rejected the broader phrase (“terms” of the proposed transaction) in favor
of the narrower phrase (“terms of payment”). Moreover, the reported appellate decisions
in which the phrase “terms of payment” appears reveals a consistent understanding that it
is meant to describe how and when the price is to be paid.33
Thus, we see that the real-estate-negotiations exception includes two topics that a
local agency may discuss in closed session: (1) the negotiator’s authority regarding the
price, and (2) the negotiator’s authority regarding the terms of payment. Well established
rules of statutory construction hold that “the expression of some things in a statute
necessarily means the exclusion of other things not expressed,”34 and that we “may not
rewrite a statute by inserting thoughts that have been omitted . . . .”35 Applying those
28 “Both the legislative history of the statute and the wider historical circumstances
of its enactment may be considered in ascertaining the legislative intent. [Citation.]”
Dyna-Med, Inc., 43 Cal. 3d at 1387. The real-estate-negotiations exception was enacted
in 1984. 1984 Stat. ch. 1126 §§ 2, 3 (Sen. 2216).
29 Sen. 2216, 1983-84 Reg. Sess. (Feb. 17, 1984).
30 Sen. 2216 (as amend. Apr. 23, 1984).
31 Sen. 2216 (as amend. May 7, 1984).
32 Sen. 2216 (as amend. Aug. 16, 1984); see 1984 Stat. ch. 1126 § 2; Govt. Code §
54956.8.
33 See Segura v. McBride, 5 Cal. App. 4th 1028, 1034 (1992); E & H Wholesale,
Inc. v. Glaser Bros., 158 Cal. App. 3d 728, 735 (1984); Kawasho Intl. v. Lakewood Pipe
Serv., Inc., 152 Cal. App. 3d 785, 792 (1983).
34 Gikas v. Zolin, 6 Cal. 4th 841, 852 (1993); Dyna-Med, 43 Cal. 3d at 1391 n. 13.
35 Gillett-Harris-Duranceau, etc. v. Kemple, 83 Cal. App. 3d 214, 219 (1978); 78
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rules to this statute leads us to reject the argument that closed-session discussions may
extend to issues that might affect “the economic value of the transaction,”36 or what might
be called “the price that the local agency is willing to pay or accept.” It is undoubtedly
true that any number of issues might fall into this broad category—for example, the
availability of easements on the subject property, or credit worthiness of the buyer or
seller, or the financial condition of the local agency itself. But we cannot agree that
collateral matters of this sort fall within the meaning of the statutory exception such that
they may be discussed out of public hearing. We believe that such an expansive reading
of what is meant by “price” would render virtually meaningless the phrase “terms of
payment,” because payment terms themselves commonly affect the price that a party may
be willing to pay or accept.37 We are not free to construe a statute in a manner that would
render any words or phrases redundant.38
Moreover, the California Court of Appeal has rejected an argument that the real-
estate-negotiations exception implies a “rule of reason” that would allow closed-session
consideration of items “reasonably related to the purpose of giving direction to a
legislative body’s negotiator.”39 In Shapiro v. San Diego City Council, a city council was
considering a development project that included the construction of a new baseball
stadium for the San Diego Padres. The city council argued that the complexity of the
proposed transaction justified closed-session discussion of various matters “reasonably
related” to the ballpark deal.40 Among these matters were: briefing on land acquisition
Ops.Cal.Atty.Gen. 192, 194 (1995); 66 Ops.Cal.Atty.Gen. 217, 222 (1983); see Code
Civ. Proc. § 1858.
36 Ltr. from League of Cal. Cities to Dep. Atty. Gen. Marc J. Nolan (Aug. 6, 2010)
3-4.
37 For example, a party’s agreement to make a full lump-sum payment at the outset
would typically bring about a lower total payment price than would a series of installment
payments made over time. See, e.g., E & H Wholesale, Inc. v. Glaser Bros., 158 Cal.
App. 3d at 735 (“cash discount” is “discount granted in consideration of immediate
payment or payment within a prescribed time” [citation]).
38 Metcalf v. Co. of San Joaquin, 42 Cal. 4th 1121, 1135 (2008); Cooley v. Super.
Ct., 29 Cal. 4th 228, 249 (2002); see Commn. on Peace Officer Stands. & Training v.
Super. Ct., 42 Cal. 4th 278, 294 (2007) (quoting Moore v. Cal. State Bd. of Accountancy,
2 Cal. 4th 999, 1011-1012 (1992)) (restrictive meaning must be adopted “‘if acceptance
of a more expansive meaning would make other items in the list unnecessary or
redundant . . . .’”).
39 Shapiro v. San Diego City Council, 96 Cal. App. 4th at 922.
40 Id. at 923.
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matters; design work of architects and engineers; infrastructure and parking
developments; capping interim expenses; environmental impact report considerations;
issues of alternative sites, traffic, stadium naming rights, expert consultants, and staff;
and such policy considerations as the impact of the ballpark project on the homeless.41
The Shapiro court acknowledged the “perceived value of confidentiality” in negotiations
and did not “denigrate [this] important consideration.”42 Nevertheless, it concluded that
the council’s closed-session discussions exceeded the scope of the “safe harbor notice
provisions” on the council’s agenda (which stated that closed-session discussions would
be conducted as to price and terms of payment), and that the topics ranged “far afield of a
specific buying and selling decision.”43
We note that the city council in Shapiro failed to identify a specific parcel of
property in its agenda when it referenced the closed-session item of business,44 and we are
aware that an argument may be made that the Shapiro case is distinguishable on that
basis. But we believe that Shapiro’s reasoning is robust enough to support the point we
make here, which is that the real-estate-negotiations exception (like the safe harbor notice
provision) simply cannot be read so broadly as to incorporate any and every topic that
might have a bearing on a public real estate transaction.
We do not mean to say that a closed session must be absolutely limited to the
specification of a particular dollar amount (or other specified consideration) that the local
agency is willing to pay or accept in a given real estate transaction. While exceptions to
the Brown Act must be given a narrow construction,45 they must still be interpreted in a
manner that gives effect to the underlying purposes of the law.46 Among the purposes at
play in this situation is the need to conserve scarce public resources through effective
negotiation of real estate transactions. In our view, therefore, a closed-session discussion
regarding price or terms of payment must allow a public agency to consider the range of
41 Id. at 923-924.
42 Id. at 924.
43 Id.
44 Id. at 908 (agenda merely specified “real property interests in the East Village
area of downtown San Diego, and at Qualcomm Stadium in the City of San Diego” or, on
other occasions, “real estate interests in the Centre City East area of downtown San
Diego”).
45 Shapiro, 96 Cal. App. 4th at 917.
46 See Duval v. Bd. of Trustees, 93 Cal. App. 4th 902, 909-911 (2001) (eschewing
overly narrow reading of “evaluation of performance” as used in Brown Act’s personnel
exception).
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possibilities for payment that the agency might be willing to accept, including how low or
how high to start the negotiations with the other party, the sequencing and strategy of
offers or counteroffers, as well as various payment alternatives. Information designed to
assist the agency in determining the value of the property in question, such as the sales or
rental figures for comparable properties, should also be permitted, because that
information is often essential to the process of arriving at a negotiating price.47
Ultimately, of course, each case must be decided on its own facts. But, for the
reasons stated, we cannot accept the view that the real-estate-negotiations exception
permits the closed-session discussion of any and all aspects of a proposed transaction that
might have some effect on price and payment terms. The purpose of the exception is to
protect a local agency’s bargaining position, not to keep confidential its deliberations as
to the wisdom of a proposed transaction.
For the reasons stated, we conclude that the real-estate-negotiations exception to
the open meeting requirements of the Brown Act permits the closed-session discussion
of: (1) the amount of consideration that the local agency is willing to pay or accept in
exchange for the real property rights to be acquired or transferred in the particular
transaction; (2) the form, manner, and timing of how that consideration will be paid; and
(3) items that are essential to arriving at the authorized price and payment terms, such
that their public disclosure would be tantamount to revealing the information that the
exception permits to be kept confidential.
*****
47 In this connection, we note that section 6254(h) exempts from public disclosure
under the Public Records Act (§§6250-6276.48) the “contents of real estate
appraisals . . . made for or by the state or local agency relative to the acquisition of
property” until after the property has been acquired.
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From:Rhoda Fry
To:City Clerk; City Council; City Attorney"s Office
Subject:RE: Closed Session, City Council July 9 2024 Purchasing a Building
Date:Tuesday, July 9, 2024 1:41:22 PM
CAUTION: This email originated from outside of the organization. Do not click links or open attachments unless you
recognize the sender and know the content is safe.
And I would like to add on that this building does not adhere to newer indoor air quality
standards – which keep people healthy and reduces the spread of COVID and other diseases.
From: Rhoda Fry <fryhouse@earthlink.net>
Sent: Tuesday, July 9, 2024 1:39 PM
To: 'City Clerk' <CityClerk@cupertino.org>; 'citycouncil@cupertino.org'
<citycouncil@cupertino.org>; 'City Attorney's Office' <CityAttorney@cupertino.org>
Subject: Closed Session, City Council July 9 2024 Purchasing a Building
Dear City Council,
I have a number of concerns regarding the purchase of a new building.
1. Typically, it only makes sense to purchase a building when the plan to hold it is at least
10 years. In this case, the idea is to use it for 2 years. It makes no sense to buy a
building.
2. Because the intended use is only for 2 years, it looks like a real-estate investment. What
is the City investment policy for real estate? And, if it is a good investment, it would
have been purchased by now. There are plenty of newer buildings in the City and there
will be plenty of even newer ones. I don’t see this as being a good investment and I
don’t think that the City should get into real-estate investing anyway.
3. We also need to be looking at either leasing or buying a building for the sheriff
substation because the current location is expected to go away. This has been on the
City’s radar for quite some time (I recall seeing it on some sort of work plan around the
time of public safety forum at Quinlan before the most recent one as I had spoken with
Mr. Morely about it). We should not be doing anything with another building that might
risk resources that need to be applied to public safety.
4. Because this building is an older building, by definition, it is not built to the most
modern seismic standards and energy-efficiency standards and more.
5. If this building were such a great deal, it would have been purchased by someone else
by now.
It is your fiduciary duty to protect our City’s coffers, please do not move forward on
purchasing this building.
Warm Regards,
Rhoda Fry
Virus-free.www.avg.com
From:Santosh Rao
To:City Council; Pamela Wu; Christopher Jensen; City Clerk
Subject:Please do not buy or proceed with the office building negotiation or transaction.
Date:Tuesday, July 9, 2024 2:14:02 PM
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recognize the sender and know the content is safe.
Respected Mayor Mohan, Manager Wu, Members of the Cupertino City
Council, City Attorney Jensen,
CC: City Clerk
I am writing to express my strong opposition to the proposed acquisition of
the 1979 Class C office building located at 19400 Stevens Creek
Boulevard. As the council deliberates this significant investment, it is
crucial to consider several compelling reasons why this purchase is not
only economically unwise but also strategically unsound.
First and foremost, the current office market conditions in the Bay Area are
deeply troubling. Silicon Valley ended 2023 with a record high office
availability rate of 27.5%, while San Francisco faced an even graver
situation with a 36.7% vacancy rate. These statistics underscore a broader
regional trend of declining demand for office space, fueled by remote work,
downsizing, and economic uncertainties. Investing in additional office
space under such conditions would likely exacerbate the financial strain on
the city.
Moreover, the rising capitalization (CAP) rates in the office market further
reflect the declining asset values and increased risk associated with office
investments. With CAP rates on the rise, the potential return on investment
diminishes, making it an unfavorable time to allocate significant city
resources to an asset class experiencing heightened volatility and decreased
demand.
The specific building in question, which has been vacant for four years,
presents additional risks. The prolonged vacancy indicates potential issues
with the property's desirability or structural conditions. This history of non-
occupancy suggests that the building may not be easily marketable or
attractive to potential tenants, especially in an already saturated market.
Furthermore, the ongoing economic recalibration in the tech sector, which
is a major driver of office space demand in our region, suggests that
recovery and renewed demand for office space will not occur in the near
term. According to recent analyses, despite some interest from sectors such
as artificial intelligence, overall leasing activity remains low, with
significant space left unoccupied.
Adding to these concerns are the challenges associated with debt financing
for a Class C 1979 office building that has sat vacant for four years.
Lenders are likely to view this property as a high-risk investment due to its
age, prolonged vacancy, and potential lack of modern amenities and
compliance with current building codes, including seismic retrofitting.
Securing favorable financing terms would be difficult, if not impossible,
and the city could face high interest rates and stringent lending conditions.
Furthermore, the risk of future capital calls by the debt provider or bank is
a significant concern. Should the building fail to attract tenants or require
unexpected major repairs, the city could be compelled to inject additional
capital to meet financing obligations, thereby straining public finances and
diverting resources from other essential projects.
The eventual disposal of this property poses yet another challenge. Selling
a 1979 Class C office building that has not been seismically retrofitted and
has a history of prolonged vacancy would be a daunting task. Potential
buyers would be wary of the significant investment required to bring the
building up to current standards and the uncertain return on such an
investment, particularly in a market already saturated with vacant office
space.
High insurance costs and the potential lack of adequate insurance coverage
for such an aged and vacant building further compound these financial
challenges. Insurers may impose prohibitive premiums or decline coverage
altogether due to the building's age, vacancy status, and potential structural
deficiencies. This lack of insurance or high insurance costs would expose
the city to substantial financial risks in the event of damage or liability
issues.
Additionally, the removal of this property from the commercial tax rolls
would result in a significant loss of property tax revenue for the city.
Transferring ownership to a municipal entity eliminates a valuable source
of ongoing tax income, further straining the city's budget and reducing
funds available for essential public services and community projects.
Investing in this property at this juncture would not only be fiscally
irresponsible but also detracts from other critical areas that require funding,
such as affordable housing, infrastructure improvements, and social
services. These sectors have a more immediate and tangible impact on the
well-being of our community and the quality of life for Cupertino residents.
I urge the city council to reconsider this purchase and instead focus on
priorities that align with the current and future needs of our community. By
doing so, we can ensure that Cupertino remains fiscally resilient and well-
positioned to navigate the evolving economic landscape.
Thank you for considering my perspective. I trust that the council will
make a decision that reflects the best interests of Cupertino residents.
Thanks,
Santosh Rao
From:Griffin
To:City Council
Cc:City Clerk; City Attorney"s Office
Subject:2024-07-09 City Council Meeting CLOSED SESSION building purchase
Date:Tuesday, July 9, 2024 2:22:43 PM
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recognize the sender and know the content is safe.
PLEASE INCLUDE THIS AS PART OF WRITTEN COMMUNICATION FOR THE
ABOVE MEETING AGENDA.
Dear City Council and Manager Wu,
This purchase does not make financial sense!
-The building is not anymore seismically safer than the current City Hall but you are planning
to buy it and pay to upgrade it then pay again to upgrade City Hall?!?
-NO public discussion of the condition of the building.
-NO public discussion of what exact requirements are needed for a relocation!
-NO publicly discussed plan!
-NO discussion in public of why this is being done.
Safety is not addressed!
-Where will the EOC be located?
-Where will the Sheriff be located?
Funding
A recent memo from City Manager Wu to all employees dated June 18, 2024 states that she
will look at the “disposition of “ city properties to pay for this!
-This was not even discussed in public. It was a public record request!
-Which properties are being considered and why? Discuss in public!!
These issues cannot be discussed in a CLOSED SESSION. They MUST be in an open
meeting.
This is irresponsible.
Please do not continue without a public discussion of the plan and the steps and the funding
source!
Peggy
From:Lisa Warren
To:City Council; City Clerk
Cc:City Attorney"s Office
Subject:City Council Meeting CLOSED SESSION commercial real estate purchase July 9,2024
Date:Tuesday, July 9, 2024 3:03:32 PM
Attachments:Exception to Brown Act for closed session Real Estate transaction discussion .DOC.docx
summary of key points from Supl Rpt re PULLED consent #12 CC mtg June 18, 2024.docx
CAUTION: This email originated from outside of the organization. Do not click links or open attachments unless you
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I REQUEST THAT THIS EMAIL COMMUNICATION AND ATTACHMENTS BE
INCLUDED THIS AS WRITTEN COMMUNICATION FOR THE JULY 9, 2024 CLOSED
SESSION MEETING OF CUPERTINO CITY COUNCIL.
Please note the two attachments to this email, in addition to the Turnkey
definitions below. They are meant to be informational and available to the
public in relation to today's closed session agenda.
As you already know, I have great concerns related to the misrepresentation
that Cupertino City Manager used in the Supplemental 'slide deck' that was in
no way part of the June 18, 2024 agenda - consent item 12.
The supplemental came into play when members of the public and city
councilmember 'pulled' the consent item for discussion.
What Is a Turnkey Property?
A turnkey property is a fully renovated home or apartment building, or other commercial building that
an investor can purchase and immediately rent out. A turnkey home is often a property purchased from a
company that specializes in the restoration of older properties. Those same firms may also offer property
management services to buyers, minimizing the amount of time and effort they have to put into the rental.
--- Lisa Warren
Definition of Turnkey property
…
what is a turnkey property
A turnkey property is one that you can buy and immediately occupy. That's because it is fully renovated
and repaired.
The Real-Estate-Negotiations Exception To The Brown Act Permits
Closed-Session Discussion Of The Amount Of Consideration The Public
Agency Is Willing To Pay, The Form, Manner, And Timing Of Payment, And
Items Essential To Arriving At Authorized Price And Payment Terms
By Heather DeBlanc
Liebert Cassidy Whitmore
Apr 12, 2012
The Attorney General has issued an opinion as to what items may be discussed under
the real-estate-negotiations exception to the open meeting requirements of the Ralph
M. Brown Act. The Brown Act permits a governing body to meet in closed session with
its real estate negotiator "to grant authority to its negotiator regarding the price and
terms of
payment" for a proposed purchase, sale, exchange, or lease of identified real property.
The real-estate-negotiations exception does not permit closed-session discussion of
any and all aspects of a proposed transaction that could effect price or payment terms.
The wisdom of the proposed transaction cannot be discussed in closed session. The
Attorney General opined that the real-estate-negotiations exception to the open
meeting requirements of the Brown Act permits closed-session discussion of the
following:
1. the amount of consideration the local agency is willing to pay or accept in exchange
for the real property rights to be acquired or transferred in the particular transaction;
2. the form, manner, and timing of how that consideration will be paid; and
3. items essential to arriving at the authorized price and payment terms, such that their
public disclosure would be tantamount to revealing the information that the exception
permits to be kept confidential.
The agenda item must specify the property, identification of agency negotiator, names
of negotiating parties, and whether the negotiation concerns, price, terms of payment,
or both. The Attorney General noted that the word "terms" is modified by "of payment"
which rules out the possibility that all terms of the transaction as a whole may be
discussed under the exception.
The AG concluded that "a closed-session discussion regarding price or terms of
payment must allow a public agency to consider the range of possibilities for payment
that the agency might be willing to accept, including how low or how high to start the
negotiations with the other party, the sequencing and strategy of offers or
counteroffers, as well as various payment alternatives. Information designed to assist
the agency in determining the value of the property in question, such as the sales or
rental figures for comparable properties, should also be permitted, because that
information is often essential to the process of arriving at a negotiating price."
Attorney General Opinion No. 10-206 (Dec. 27, 2011) [2011 WL 6917511].
This article was written by Heather DeBlanc, an attorney with the full service education
law firm of Liebert Cassidy Whitmore. Ms. DeBlanc is an Associate in the Los Angeles
office and can be reached at (310) 981-2000 or at hdeblanc@lcwlegal.com. For more
information regarding the information above or our firm please visit our website at
www.lcwlegal.com, or contact one of our offices below.
Liebert Cassidy Whitmore publishes the Business and Facilities Update as a service to
our clients and other friends for informational purposes only. It is not intended to be
used as a substitute for specific legal advice or opinions and the transmission of this
information is not intended to create an attorney-client relationship between sender and
receiver. You should not act upon this information without seeking professional counsel.
Read on lcwlegal.com
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Comments from another source:
The starting point for our analysis is, necessarily, the language of the
exception itself, together with related provisions of the Brown Act.15
The real-estate-negotiations exception provides, in relevant part, as follows:
Notwithstanding any other provision of this chapter, a legislative body of a
local agency may hold a closed session with its negotiator prior to the
purchase, sale, exchange, or lease of real property by or for the local agency
to grant authority to its negotiator regarding the price and terms of payment
for the purchase, sale, exchange, or lease.
However, prior to the closed session, the legislative body of the local
agency shall hold an open and public session in which it identifies its
negotiators, the real property or real properties which the
negotiations may concern, and the person or persons with whom its
negotiators may negotiate.
16 The disclosure requirement set forth in the second quoted
sentence mirrors a more general Brown Act provision to the same effect.
17 Both of these notice provisions reinforce the Act’s general notice
requirement that, “[a]t least 72 hours before a regular meeting, the
legislative body of the local agency, or its designee, shall post an agenda
containing a brief general description of each item of business to be
transacted or discussed at the meeting, including items to be discussed in
closed session.”
18 14 Id. 15 See Shapiro v. San Diego City Council, 96 Cal. App. 4th at 924.
16 § 54956.8. 17 § 54957.7(a) (“Prior to holding any closed session, the
legislative body of the local agency shall disclose, in an open meeting, the
item or items to be discussed in the closed session . . . .”) 18 § 54954.2(a)
(emphasis added). 4 10-206 With regard to the real-estate-negotiations
exception, the Act provides that it is sufficiently specific (or within a “safe
harbor”) to describe the agenda item as follows:
CONFERENCE WITH REAL PROPERTY NEGOTIATORS Property: (Specify
street address, or if no street address, the parcel number or other unique
reference, of the real property under negotiation.) Agency negotiator:
(Specify names of negotiators attending the closed session.) (If
circumstances necessitate the absence of a specified negotiator, an agent or
designee may participate in place of the absent negotiator so long as the
name of the agent or designee is announced at an open session held prior to
the closed session.) Negotiating parties: (Specify name of party (not
agent).) Under negotiation: (Specify whether instruction to negotiator will
concern price, terms of payment, or both.)
19 The Act provides that, “in the closed session, the legislative body may
consider only those matters covered in its [agenda] statement.”
The [agenda] statement
Type: Consent Calendar Status: Agenda Ready
File created: 6/5/2024 In control: City Council
On agenda: 6/18/2024 Final action:
Title: Subject: Consider acquisition of property located at 19400 Stevens Creek Blvd,
and appointment of real property negotiator for acquisition of property
CC 06-18-2024
#12
Consider acquisition of property located at 19400 Stevens Creek Blvd
Bullet points from slide #4 of ‘Supplemental Report’ to Consent Item
#12 on June 18 City Council meeting Agenda
Key Elements and Opportunities
• Turnkey office space located at 19400 Stevens Creek Boulevard
• 1.2-acre lot, 20,700 square feet of office
• Accessible location for the community
• Could serve as an interim City Hall while potential partnership and
funding options are explored for current site