Deal for bargain downtown site unravels Deal for bargain downtown site unravels (July 29, 2005)

City loses court battle to buy S.F.-owned parcel
by Jeb Bing

Pleasanton's five-year effort to force San Francisco to abide by a handshake agreement to sell a three-acre vacant parcel near City Hall at a bargain price of $500,000 is over.

The City Council decided against pursuing a review by the state Supreme Court of a decision by the Third District Appellate Court rejecting Pleasanton's claim.

The site, across from the Pleasanton Public Library on Old Bernal Avenue was rezoned two years ago from commercial to public use. It is part of the city's long-range plan to expand the Civic Center and library complex.

City Atty. Michael Roush said the acreage was supposed to have been part of a broader agreement that was negotiated with San Francisco in 2000 with regard to the purchase of the 510-acre Bernal property that San Francisco owned for $126 million. But when the final deal was struck just before the midnight deadline of Oct. 31 that year, city staff realized that the three-acre site was not included. The city proceeded with the agreement so as not to jeopardize the rest of the deal that included a gift of 318 acres of the Bernal property to the city free of charge for public uses.

Before taking that action, Roush said Pleasanton had received verbal assurances at public hearings from Bruce Lymburn, an attorney then representing the San Francisco PUC, and confirmation of the city's intention to sell the acreage for $500,000 in a letter dated Aug. 22, 2000, from then-Mayor Willie Brown.

But later, after the Greenbriar sale had been completed, PUC General Manager Patricia Martel advised Pleasanton officials that a new appraisal showed that the three-acre site had a market value of $3,485,000, or almost seven times Pleasanton's proposed offer of $500,000.

"While the SFPUC is willing to consider a sale of the parcel to Pleasanton, a sale at such a discounted rate would violate San Francisco Administrative Code, Chapter 23," she wrote in a letter to the city.

Since the PUC has a policy of offering discounts to other public agencies, she offered to sell the land to Pleasanton for $3 million. Pleasanton sued to force San Francisco to sell the land at the price promised, but Judge Thomas Cecil of the Sacramento Superior Court, where the suit was filed, ruled that the verbal agreement and Mayor Willie Brown's letter did not constitute a sales contract. He dismissed the suit and the Appellate Court concurred with that decision.

Roush said that if the city still wants to acquire the property, it will now have to deal directly with the San Francisco PUC.

E-mail a friend a link to this story.