Santa Monica to Consider Selling Civic Auditorium to Developers in a Closed Session

The Santa Monica Civic Auditorium was built in 1958 and holds about 3000 people. The City closed it permanently in 2002, stating that it was too small and acoustically challenged to serve as a concert venue any longer.

One local resident says that in a closed session, the Santa Monica City Council could sell it off to developers in a desperate attempt to close a budget shortfall.

Tricia Crane, Chair of the Northeast Neighbors Association, believes the potential sale is a violation of the State's Surplus Land act, which requires that any potential sale first be offered to Housing and Community Development. Her email is below.

Monday, July 17, 2023 7:29 PM. Subject: NE Neighbors: Our history is being sold and we are in the Dark - Will the City sell the Civic? Tuesday Council Closed Session

Dear Northeast Neighbors and friends,

Our cultural legacy and future cultural potential is fast disappearing. The people of Santa Monica have not been told why.

Tomorrow night, July 18, City Councilmembers will meet in Closed Session to discuss with a real estate negotiator the possible sale of the Santa Monica Civic Auditorium. Closed Session Items 3E and 3F can be found on the Council Agenda at this link:

https://santamonicacityca.iqm2.com/Citizens/Detail_Meeting.aspx?ID=1389

The people of Santa Monica have not been informed of the scale of the financial hole that needs to be filled, what justifies its size, how fast it needs to be filled nor what all the other options are. All we know is that the need for cash is so pressing that it justifies the on-time irrevocable sale of irreplaceable cultural assets that will be needed more than ever in a densifying city. But, we have no way of assessing the priority tradeoffs being made. None.

There must be other options. The City's Proposed FY24 revenue budget was $747.1 million. Of that, $438.7 million (59%) was for the General Fund, which allows for completely discretionary spending decisions. Yet savings could not be found from this massive pool of General Fund money to replenish reserves or pay for whatever priority is driving these decisions? These general fund revenues increased $24 million, or 6%, since FY22. Department budgets have ballooned. For example, the City Manager's proposed FY24 department budget for consultants ("Professional Services") has increased by $587,171 (101%) since FY2022.

Without any case being made to the voters, we have no idea if a sale makes any sense. Nor do we have any idea of the structure of any proposed sale. For example, will the Civic: Landmark status be maintained in any transaction regarding its future? Be allowed to be torn down if sold?

Also on the proverbial chopping block in Closed Session Tuesday is a parcel the city owns near the light rail station on 4th Street. How will negotiations go for that parcel, which could be developed by the city into 100% affordable housing to help meet state requirements but instead sold to a developer who will likely produce 10% affordable and 90% market rate as has been done with Gelson's.

Then there is compliance with state law, which has not been disclosed. The state's Surplus Lands Act (SLA) requires local agencies to contact HCD twice. First, when a local agency declares land surplus and issues a Notice of Availability (NOA), the local agency must send the NOA to HCD. (Gov. Code, § 54222, subd. (a)(1).) Second, the local agency must contact HCD again once at least 60 days have passed after the issuance of an NOA and any required 90-day good faith negotiations have concluded. At that time, the local agency must provide HCD with disposition documents that include the following: a copy of the Resolution declaring the land surplus, a copy of the NOA, a copy of the draft affordability covenant, proof of NOA delivery to all required entities per Government Code section 54222 (see Noticing Requirements below), and a description of any negotiations that have taken place. (Gov. Code, § 54230.5, subd. (b)(1).)

The overarching issue here is completely deficient governance. This fiscal responsibility deficit is a subset of a much larger governance deficit. Why should elected officials meet in secret to negotiate the sale of a public landmark without the respect to the voters of making a compelling case, and without any public input?

If the Council had integrity and any respect for the voters, it would pull these items from the Closed Session and openly discuss what the realities and options are.

Tricia Crane, Chair, Northeast Neighbors