LBREPORT.com streamed the Council proceedings live on our front page. Among public speakers, six supporters of LB's Reform Coalition (which opposed a Nov. 2018 Charter Amendment sparing incumbents write-in requirements for third terms) and taxpayer advocates focused on costs and questioned and sought public release of a City-hired appraisal of the property.

They were outnumbered roughly five to one by supporters of the transaction who cited a need for homeless services and included individuals with ties to homeless services providers and advocacy groups. Supporters of the transaction included residents of the adjoining NLB neighborhood who joined a number of speakers beyond in urging Councilmembers to locate similar homeless facilities in other Council districts (with no audible objection from Councilmembers present.)

Mayor Garcia initially proposed to limit public speakers to 90 seconds seconds each but ultimately limited members of the public to 120 seconds each for roughly half an hour before limiting the public to 90 seconds each. No Councilmembers objected to this.

Three Councilmembers were absent on the vote, two of whom were present earlier in the Council meeting. Councilwoman Lena Gonzalez (currently seeking a vacated state Senate seat) began the Council meeting via teleconference from Sacramento but had vanished by the time the vote was called. Councilwoman Stacy Mungo (the Mayor's choice to chair the Council's "Budget Oversight Committee") was also present earlier in the meeting but was captured on video leaving the Council Chamber before the item was called.

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Councilwoman Stacy Mungo exits Council Chamber prior to Council item approving NLB property purchase for year-round homeless shelter. Screen save from Council webcast, Feb. 5, 2019

Councilman Roberto Uranga (a Coastal Commission member) was absent for the entire Council meeting, with Coastal Commission meetings scheduled to begin the next morning in Half Moon Bay.

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Councilman Rex Richardson, who made the motion to approve the transaction (seconded by Councilwoman Jeannine Pearce) said Councilmembers Mungo and Gonzalez had reached out to him prior to the evening's vote to indicate their support for the transaction.

During public testimony, Megan Kerr, an LB School Board member representing NLB, commented, "I want to thank the Councilmembers who stayed in the Chamber for this entire discussion." Her remark drew a sharp response from Councilwoman Suzie Price, who'd exited the Council meeting during the two hour-twenty minute item but returned in time to join in a unanimous approval vote. "We had a recital at my son's school, Lowell Elementary School tonight, so I did go to his recital and was back within an hour. I was the only parent he had there tonight so I felt it was important to me to be there," Price said. "In five years, it's the first time I've ever walked away from a Council meeting to do something for my family" and pointedly added "I have never walked out of Council Chambers for a vote ever [emphasis in her voice.] I frankly think that's cowardly and I'd never do it and anyone who knows me knows that I don't take those issues lightly."

[Ed. note: In September and October 2018, Councilmembers Gonzalez, Pearce, Uranga and Richardson exited the Council Chamber for what they later called a "protest" over a Council item (without casting a recorded "no" vote.) In February 2017, Councilmembers Mungo and Andrews vanished on a vote to put Long Beach on record as supporting then-advancing Sacramento legislation (SB 31 and SB 54) to create statewide immigration sanctuary policies; Mungo returned after the vote; Andrews did not.]

LB Municipal Code section 2.03.100B, titled "Decorum," specifies that "No member of the Council shall leave the Council chamber without permission from the Mayor " Councilmembers Mungo, Gonzalez and Price exited the Council Chamber without receiving the Mayor's audible permission. The practice of LB Councilmembers simply leaving Council meetings as they please has been commonplace for years notwithstanding the LB Municipal Code secton and hasn't drawn objections or points-of-order from any Councilmembers.) On the Feb. 5 Council item, Councilwoman Price returned and cast a vote; Councilmembers Mungo and Gonzalez didn't.

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The sole oblique reference by LB electeds to ongoing taxpayer costs to operate, maintain and staff the future City-owned facility came from Mayor Robert Garcia (who three weeks earlier in his "State of the City message said LB has a "fiscally responsible government.") After thanking the transaction's supporters, stating he was proud to be Mayor of a city with residents who support the action, crediting CA's "Big 10" Mayors (a group that includes him) for persuading the state legislature and Governor Brown for last year to allocate half a billion dollars from a FY19 state budget "surplus" to cities for homeless services, Mayor Garcia indicated that the same Mayors' group is urging the state legislature to do the same again this year.

Speakers from the Reform Coalition and its supporters questioned (and sought a copy of) a City-hired appraisal that put the property's value at roughly $7.5 million (although it sold most recently in December 2013 for $2 million.) City management (without audible objection from Councilmembers) declined to release the appraisal until the sale was completed (citing a section of the Public Record Act allowing (but not requiring) the City to withhold release of the appraisal.

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• The City's independent appraisal was conducted by Hawran & Malm, LLC., subject to the reporting requirements defined by the Uniform Standards of Professional Appraisal Practice (USPAP), in accordance with the Appraisal Institute Code of Ethics.

• The appraisal utilizes Sales Comparison, Cost, and Income Capitalization approaches to establish the total value of the property.

• The land and improvement fair market value is $7,540,000 including the income-generating potential of the industrial, residential, and retail (liquor store) buildings, parking areas, undeveloped areas of the property, furniture and equipment.

• The appraisal indicates that the property was purchased for $3 million by the Long Beach Rescue Mission Foundation but sold to the current ownership in 2013 for a below-market sales price of $2 million due to undisclosed, extenuating circumstances. The below-market sale was not considered "arms length" which likely impacted the below-market assessed value recorded by the Assessor.

• The appraisal indicates that demand in the submarket for industrial properties in North Long Beach (driven by adjacency major freeways and the busiest ports in the United States), is extremely high with a vacancy average between 3-4 percent.

• Additionally, the 2018 City ordinance allowing for marijuana-related businesses in the Subject area significantly increased the regional value of the property. As an example, the property owner had recently executed a lease with a marijuana business valued at $40,000 per month, which dramatically increased the income-based valuation of the property.

• The City intends to release the appraisal May 31st, after the closing of escrow, to protect the negotiating process. Technically, the negotiating process is considered active until due diligence by both parties is complete. The appraisal will not be made available until acquisition and due diligence of all of the property is completed pursuant to California Government Code 6254(h).

LB mortgage broker Lauren Boland cited the transaction's cost (roughly $9.5 million, which includes acquiring and phasing out a liquor store on the site by Jan. 2020), questioned its reliance on what she called a price inflated by a marijuana gold rush that's over...and said, the homeless need every dollar spent appropriately and suggested the $8 million obtained from state taxpayers might be better used to provide homeless services instead of funding a single property transaction.

In his motion to approve the transaction, Councilman Richardson included requested that city staff provide a report within 30 days outlining the upcoming process (with "robust community outreach") related to operation of the future shelter plus a broader description of larger visioning for uses on the site.

Years ago, the property was the home of "Atlantic Farms" which offered consumers fresh produce (and butcher on site for freshly cut meat.) In recent years, it was used as winter homeless shelter.;

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