Modesto’s courthouse land deal still awaiting state approval

More than six months have passed since the Modesto City Council voted to buy an entire block downtown for the new county courthouse.

That land deal, however, has yet to go through, and a deadline looms.

The $5,450,000 purchase continues to weave its way through the state approval process, but governmental officials insist escrow will close by the end of the year.

If it doesn’t, the controversial agreement to buy all the properties between Ninth and 10th streets and H and G streets may have to be renegotiated.

“The current conditional acquisition agreements are effective until the end of December,” said Brent Sinclair, Modesto’s community and economic development director. “Everyone is aware of that date, and all parties are working for a close of escrow by or before the end of the year. I am not sure what would happen if that timeline is not achieved.”

The planned purchase is a complicated deal involving six private landowners, plus property owned by the city of Modesto and the city’s now-defunct Redevelopment Agency.

The City Council in April approved a plan for Modesto to buy all the privately owned properties for $4,553,000, and then to resell the block – including 53,500 square feet of city property – to the state Administrative Office of the Courts for $5,450,000.

That deal triggered protests in the spring by community members who wanted the courthouse to remain on I Street. The alternate courthouse site was at 13th and I streets on the block where The Modesto Bee leases office space.

But state and city officials preferred the 10th Street location, and the City Council sweetened the deal by agreeing to have Modesto abandon its alley and move all the utilities out of the center of that block.

The Administrative Office of the Courts has completed its review of the land deal. Now other government officials must approve it.

“The Department of Finance is finalizing their review process of the documentation we submitted,” said Keby Boyer, the state courts spokeswoman. “When that’s complete, they’ll submit everything to the state Public Works Board for their review.”

That Public Works Board only meets once a month. The Modesto courthouse is not on this month’s agenda, leaving only the Nov. 14 or Dec. 12 meetings before the purchase agreement expires.

“We expect to close escrow by no later than the end of the year, and expect this not to be an issue,” Boyer said regarding the contract deadline.

Mayor Garrad Marsh said Modesto is ready to go once the state gives the go-ahead.

“There’s nothing here that’s stopping the process,” Marsh said. “We’re at the point that if they wanted to open escrow tomorrow we could do it.”

Here’s what the city has agreed to purchase and for how much:

▪ $2.5 million for 900 H St., a 28,000-square-foot parcel owned by Greg Reed’s G & K Enterprises.

▪ $625,000 for 711 10th St., a 7,000-square-foot parcel owned by Greg Reed’s G & K Enterprises.

▪ $492,000 for 712 and 706 Ninth St., a 10,500-square-foot parcel owned by Gary and Myrna Gervasoni.

▪ $325,000 for 716 Ninth St., a 3,500-square-foot parcel owned by Curtis Motel.

▪ $270,000 for 701 10th St., a 14,000-square-foot parcel owned by Charles W. Noble, Dorothy M. Noble, Von Deen Bubeck and Jerry Bubeck.

▪ $341,000 for 713 10th St., a 3,500-square-foot parcel owned by Gina Rugani, Michael Gene Rugani and Sandra Ann Heffernan.

The utility lines won’t be moved until after the sale closes escrow.

“Utility relocation would not commence until all tenants are relocated and buildings are vacated,” Sinclair said. “The soonest that could happen would be early 2016.”

Boyer said the state will tear down the buildings as part of its overall construction process, and that “will begin sometime after the site is acquired.”

The $277 million, 26-courtroom complex is expected to be finished by 2019.

This story was originally published October 21, 2014 at 8:29 PM with the headline "Modesto’s courthouse land deal still awaiting state approval."