Resolution No. 2022-43 | Surplus Land Act - 5925 Monterey Frontage Road | Adopted 07/05/2022
RESOLUTION NO. 2022-43
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF GILROY
DECLARING PURSUANT TO GOVERNMENT CODE SECTION 54221
THAT REAL PROPERTY OWNED BY THE CITY AT 5925 MONTEREY
FRONTAGE ROAD IS “SURPLUS LAND” WITHIN THE MEANING OF
THE SURPLUS LAND ACT, FINDING THAT SUCH DECLARATION IS
EXEMPT FROM ENVIRONMENTAL REVIEW UNDER THE
CALIFORNIA ENVIRONMENTAL QUALITY ACT, AND TAKING
RELATED ACTIONS
WHEREAS, the City of Gilroy is the owner in fee simple of that certain unincorporated
real property commonly known as the Gilroy Sports Park, which comprises approximately 80
acres, more or less, and which is located at 5925 Monterey Frontage Road, Assessor’s Parcel Nos.
808-21-026, -028, and -030 (the “Sports Park”); and
WHEREAS, the City’s Sports Park Master Plan (the “Master Plan”) contemplates
construction of an indoor sports complex (the “Sports Complex”) within the Sports Park on land
comprising a portion of Assessor’s Parcel Nos. 808-21-026 and -028, and more particularly
designated as the “project site” in Exhibit A, attached hereto and made a part hereof by this
reference (the “Property”), which comprises approximately 9.1 acres, more or less; and
WHEREAS, on May 19, 2019, the City entered an Exclusive Negotiating Agreement (the
“ENA”) with Sharks Sports & Entertainment LLC (“SSE”) to attempt in good faith to negotiate
an agreement with SSE to assist in the development of the Sports Complex and to operate it for
the benefit of the City (“Operating Agreement”); and
WHEREAS, on January 1, 2020, AB 1486 took effect, which revised the Surplus Land
Act, Government Code Section 54220, et seq., to impose new obligations on local public agencies
with respect to the disposition of land, and which conferred new enforcement powers on the
California Department of Housing and Community Development (“HCD”); and
WHEREAS, Government Code Section 54234 provides that a disposition of local public
agency land is subject to the law as it existed prior to January 1, 2020, if the land was subject to
an existing exclusive negotiating agreement effective as of September 30, 2019, and is disposed
of by December 31, 2022; and
WHEREAS, the ENA has been extended by the City Council multiple times, including
most recently on June 20, 2022; and
WHEREAS, to provide adequate time for both parties to conduct due diligence and to
complete negotiations, it now appears that an Operating Agreement with SSE will not be
concluded by December 31, 2022; and
WHEREAS, the City desires to retain the Property for recreational use by members of
the public, but the proposed use of the Property as a Sports Complex is not “agency use” within
the meaning of Government Code Section 54221(c), as construed by HCD; and
DocuSign Envelope ID: A2478A41-DC8F-4F91-84C3-89B29E965525
Resolution No. 2022-43
Surplus Land Act – 5925 Monterey Frontage Road
City Council Regular Meeting | July 5, 2022
Page 2 of 5
WHEREAS, unless and until negotiations are concluded, the City is unable to determine
whether an Operating Agreement would constitute a “disposition,” as that term is used in the
Surplus Land Act, and as it is construed by Section 102(h) of HCD’s Surplus Land Act Guidelines;
and
WHEREAS, the Property is not exempt surplus land in the that none of the circumstances
stated in Government Code Section 54221(f) applies; and
WHEREAS, the Property is not in active use by the City for any purpose except to be held
for future use as part of the Gilroy Sports Park, the City does not have any current plan for the
Property other than to develop the Sports Complex , and the City has never committed itself to
developing the Sports Complex; and
WHEREAS, based on the foregoing facts and circumstances, the City is unable to
determine at this time whether entry into an Operating Agreement would be subject to compliance
with the Surplus Land Act, as amended by AB 1486, including by declaring the Property surplus,
providing Notice of Availability, accepting offers from eligible parties to acquire the Property, and
negotiating in good faith upon receipt of any such offer or offers; and
WHEREAS, to obtain financing to construct the Sports Complex, the City and any
potential lenders require certainty that entry into an Operating Agreement will not subject the City
to penalties pursuant to Government Code Section 54230.5, so that it has been determined to be in
the City’s best interest to pause negotiations with SSE to provide an opportunity to complete the
process outlined in the prior recital, and not to resume negotiations unless and until HCD confirms
such compliance as provided for in its Surplus Land Act Guidelines; and
WHEREAS, the Property is designated as a park and recreational facility in the Master
Plan and in the City’s General Plan, so that first priority in negotiations pursuant to Government
Code Section 54277 shall be given to a public agency that agrees to develop the Property for parks
and recreational purposes; and
WHEREAS, the City Council’s action in adopting this resolution is exempt from review
under the California Environmental Quality Act (“CEQA”) pursuant to CEQA Guidelines Section
15061(b)(3) because it can be seen with certainty that declaring the Property surplus and directing
staff to issue a written Notice of Availability will not have a foreseeable significant effect on the
physical environment in that the City has not committed the Property to any particular use at this
time, predicting the impacts of any future use of the Property following its disposition by the City
would be wholly speculative, and none of the circumstances in CEQA Guidelines Section 15300.2
applies;
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Resolution No. 2022-43
Surplus Land Act – 5925 Monterey Frontage Road
City Council Regular Meeting | July 5, 2022
Page 3 of 5
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Gilroy as
follows:
1. That the City Council finds that the foregoing recitals are true and correct.
2. That the City Council hereby declares that the Property is surplus and not necessary
for the City’s use.
3. That the City Clerk is hereby directed to send a Notice of Availability to the entities
designated in Government Code Section 54222. The Notice of Availability shall
be sent in a manner set forth in Section 201 of HCD’s Surplus Land Act Guidelines.
4. That the officers and staff of the City are authorized hereby to do all things
necessary or proper to effectuate the purposes of this Resolution, and that any such
actions previously taken are hereby ratified and confirmed.
PASSED AND ADOPTED this 5th day of July, 2022, by the following vote:
AYES: COUNCIL MEMBERS: ARMENDARIZ, BRACCO, HILTON,
LEROE-MUÑOZ, MARQUES, TOVAR,
BLANKLEY
NOES: COUNCIL MEMBERS: NONE
ABSTAIN: COUNCIL MEMBERS: NONE
ABSENT: COUNCIL MEMBERS: NONE
APPROVED:
Marie Blankley, Mayor
ATTEST:
_______________________
Thai Nam Pham, City Clerk
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Resolution No. 2022-43
Surplus Land Act – 5925 Monterey Frontage Road
City Council Regular Meeting | July 5, 2022
Page 4 of 5
EXHIBIT A
DEPICTION OF THE PROPERTY
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Resolution No. 2022-43
Surplus Land Act – 5925 Monterey Frontage Road
City Council Regular Meeting | July 5, 2022
Page 5 of 5
DocuSign Envelope ID: A2478A41-DC8F-4F91-84C3-89B29E965525
CERTIFICATE OF THE CLERK
I, THAI NAM PHAM, City Clerk of the City of Gilroy, do hereby certify that the attached
Resolution No. 2022-43 is an original resolution, or true and correct copy of a city Resolution,
duly adopted by the Council of the City of Gilroy at a Regular Meeting of said held on Council
held Tuesday, July 5, 2022, at which meeting a quorum was present.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the Official Seal of
the City of Gilroy this Tuesday, July 5, 2022.
____________________________________
Thai Nam Pham, CMC, CPMC
City Clerk of the City of Gilroy
(Seal)
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