sr-082581-7fCA:RMM:BB:se
City Council Meeting 8-25-81
STAFF REPORT
TO• Mayor and City Council
FROM: City Attorney
AUG 2 5 1981
SUBJECT: Claim for ~?ested Right from Emergency Building
Moratorium, Claim Number M-057, b_<<~ Santa Monica
Employees Federal Credit Union To Remodel Existing
Structures for Credit Union Offices at 3205 Santa
Alonica Boulevard.
PROJECT DESCRIPTION
Claimant seeks to remodel a vacant structure at
3205 Santa Monica Boulevard, previously used for office for use
by the Santa Aionica City Employees Credit Union. The cla m.
«as filed because claimant seeks to convert a 4-car garage
within the structure into office space. Parking spaces for
3 cars will be provi,?ed in front of the structure.
The property is zoned C-4. It was purchased by claimant
on May 19, 1981.
VESTED RIGHT
A determination of vested right depends on whether the
claimant has secured the last governmental approval necessary
for construction and, in good faith reliance thereon, performed
substantial work or incurred substantial liabilities in further-
ance thereof.
In connection with this project, claimant did not obtain
any of the necessary governmental approvals prior to the adoption
of the moratorium. Since April 22, 1981 claimant has obtained an
Santa Monica, California
AUG ? 5 1981
exemption from Rent Control as non-residential rental property.
ARB approval and a building permit will be necessary:
No expenditures were made nor liabilites incurred prior to
adoption of the moratcrium.
Claimant does not have a vested right to proceed in that no
governmental approvals were obtained prior to April 22, 1991 and
no expenditures were made and liabilities incurred in reliance on
such approvals prior to that date.
unRnaurp
According to claimant, it purchased the subject property
and sold the structure currently occupied by the Credit Union
under orders from the National Credit Union Administration.
The reasons stated for the order concerned the building's size
and cost - too much money was being spent on too large a building,
and- the fact that the Credit Union was acting as a landlord
with respect to the building, apparently an impermissible funr_tion.
The subject property was purchased after the rent control
exemption was granted. Claimant has also sold property it
currently occupies. Since claimant cannot u£ilize .the entire
structure without exemption from the moratorium, it continues to
operate at its present location. It now pays $6000 monthly rent
to the new owners of that property and, at the same time, makes
mortgage payments for the subject property.
According to claimant, delay in being able to move inter the
new location will require continued monthly payments of rent and
mortgage ,thereby potentially diluting c'_aimant's liquidity and
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preventing funds now used for rental from being used to strengthen
the financial position of the Credit Union.
RECOMMENDATION
1. It is resne.^_tfully recommended that the claim for
vested right be denied. Prior to April 22, 1981, claimant had
not obtained the last necessary governmental approval and di~i
not perform substantial work or incur substantial liabilites
in reliance thereon.
2. If, under the fact as presented above or as may be
determined at the ti*_*ie of the hearing, the City Council should
determine that application of the moratorium to claimant's
project wou13 result in an unfair hardship to claimant, an
exemption on the basis of unfair hardship should be granted.
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