101-staff report.pdf
ADMINISTRATIVE SERVICES DEPARTMENT
CITY HALL
1010300TORRE AVENUE • CUPERTINO, CA 95014-3255
TELEPHONE: (408)777-3220www.cupertino.org
CITYCOUNCILSTAFFREPORT
Meeting:June 21, 2011
Subject
Ratifythe sale of propertylocatedat 10346 ScenicBlvd.,Cupertino,California
RecommendedAction
Adoptaresolutionapprovingthe saleof propertylocatedat 10346 ScenicBlvd.,Cupertinointhe
amount of $1,440,000 andauthorizingCarolAtwood,theRealPropertyNegotiatortoexecuteall
necessary documentstocompletethetransaction.
Description
InJanuaryof 2011, theCity ManagerapproachedtheCouncilrequestingthe sale of his home.
TheCityisanequity partnerwiththeKnappsintheresidential propertylocated on ScenicBlvd.
AlthoughtheCaliforniaConstitutionActXIsection 10(b) does notallowcitiestorequireaCity
Managertobecomearesident oftheCity,this benefitwasextendedto himas part of hiscontract
when heacceptedtheCityManager positionin 2000. Itis Mr.Knapp’sintentiontomove back
to hisformerresidenceinLosGatos.He has no planstoretireatthistime.
The propertywaslistedfor salethisSpringandan offeris pendingat $1,440,000 withthe buyer
taking possession on July 14, 2011. The saleis betweenawilling buyerand sellerandfollowed
other offersandcounter-offerswhichwere ultimately not successful.Second,thefairmarket
valueisreflectedintheattachedrealestateappraisal. Theattachedresolutionandappraisalwill
formalizethistransaction.
TheCity purchasedthepropertyin 2000 fromtheformerCityManager.TheCity Manger,
DavidKnapp becameanequity partnerbycontributingatotal of $315,000. Thisconsisted of
$50,000.00cashandaloanfromtheCityof $265,000.Witha purchase price of $1,400,000 in
2000,Knapp’sequityinterest($315,000)is 22.5%. TheCity’sequityinterestis 77.5%.
Theterms ofthe housingagreement providethatuponthe sale ofthe propertytheremaining
balance on themortgagemust be paidtotheCity.Aftertheremaining balance ofthemortgage
is deductedfromthese proceedsandafterallcosts of saleare paid,theKnapp’swillreceive
22.5% ofthe proceedsandtheCity shallreceive77.5%.
FiscalImpact
The sale oftheresidenceprovidesapproximately$1,250,000in one-timerevenue/loan payments
totheGeneralFund.
____________________________________
Preparedby:CarolAtwood
Reviewedby:CarolKorade
ApprovedforSubmissionby:DavidW.Knapp,CityManager
Attachments:Appraisal;Resolution, Trackmap