By Mark Gutglueck
Questions remain about not only the propriety but the legality of the City of Yucaipa’s move to once again sell off for development property that was donated to the Yucaipa community two generations ago by the Finkelstein Brothers for the express purpose of public rather than private use.
Last week, the Yucaipa Planning Commission cleared the way for the Yucaipa City Council to sell off for the second time in less than a year land that for 52 years has been designated exclusively and what was said to have been irrevocably for use as parkland or variously for educational or public institutional purposes.
At the March 25, 2019 Yucaipa City Council meeting, the council approved the sale of 0.87 acres at the northwest corner of Yucaipa Boulevard and 13th Street to JADE Real Estate Holdings, Inc. for $500,000. That property is located east of the Crafton Hills Fire Station on the same parcel which included the footprint upon which the fire station was sited.
In 1964, Ruben and Lester Finkelstein gave indication that they would potentially provide, through their foundation, property upon which a community college in the then-unincorporated community of Yucaipa would be built. In 1966, the Finklesteins made good on that offer with an initial donation of 167 acres, following that original bequest with the provision of 76 more acres in 1970 and subsequently donating 251 acres of additional land.
Those donations entailed deed restrictions that limited the use of the land to those for charitable, educational and recreational purposes. A significant portion of the donated land was used for the campus of Crafton Hills College, which opened in 1972. When the City of Yucaipa incorporated in 1989, title to the remainder of the property not comprising the college campus transferred to the city. The deed restrictions remained in effect.
The land in the general vicinity of the college over the years has been utilized for public purposes, including one of the city’s sports complexes, which is administered by the Yucaipa Parks and Recreation District.
On November 19. 2018, the city received a letter from JADE Real Estate Holdings that expressed interest in purchasing 0.87 acres of property located at the northwest corner of Yucaipa Boulevard and 13th Street. JADE’s intention related to possible commercial development of the property. Shortly thereafter, during a closed session at its December 9, 2018 meeting, the city council gave direction to staff, despite the deed restriction relating to the property, to pursue disposition of the parcel.
For the property to developed commercially, the deed restriction had to be removed.
At the Yucaipa City Council meeting on March 25, 2019, a consideration of what that evening’s agenda designated as “the disposition of city property: 0,87 acre parcel, northwest corner of Yucaipa Boulevard and 13th Street (portion of assessor parcel number 299-321-62)” took place.
In a report to the city council relating to the item, Paul Toomey, Yucaipa’s director of community development, wrote that he recommended the city council “Find the city disposition of a portion of assessor parcel number 299-321-62 is consistent with the general plan; and adopt a categorical exemption pursuant to the California Environmental Quality Act of 1970 guidelines; and direct staff to file a notice of exemption; and approve the sale of city-owned property located at the northwest corner of Yucaipa Boulevard and 13th Street, further defined as a portion of assessor parcel number 299-321-62, for an amount of $500,000 to JADE Real Estate Holdings, Inc.; and authorize staff to establish an amount from the proceeds of the sale of the property sufficient to pay the city’s share of closing costs and expenses; and authorize the city manager to make any necessary non-substantive revisions and execute a purchase and sale agreement and other necessary documentation in order to complete the property disposition process; and allocate the net proceeds from the sale to the general fund one time capital projects fund for recreational facility improvements.”
Anticipating that the city council was amenable to designating the 0.87 acres as “surplus property” which could be sold, Toomey asserted in the body of the report that a necessary requisite of the rescission of the deed restriction on the property had been met. “In July 2018, the Finkelstein heirs executed a termination of deed restriction, permitting the property to be developed as proposed, subject to the condition that the net proceeds from the sale of the land be used for recreational purposes,” Toomey wrote in the report. Nowhere in the report, dated, March 25, 2019, did Toomey explain how it was that someone with the city had the prescience to obtain the termination of deed restriction from the Finkelstein heirs in July 2018, some four months before JADE Real Estate Holdings, Inc. sent the city a letter indicating its interest in purchasing the property.
This month, at its December 18 meeting, the Yucaipa Planning Commission took up a proposal that the city make a minor general plan amendment to change the land use designation of approximately 1.67 acres adjacent to the Crafton Hills Fire Station, yet another portion of the land gifted to the community by the Finkelstein Brothers, to general commercial zoning. The land use designation change requested is to impact portions of vacant property adjacent to 32664 Yucaipa Boulevard, referred to as assessor parcel numbers 0299-321-61, 84 and 85. The 1.67 acres of land is proximate to the 0.87 acres sold to JADE near the corner of Yucaipa Boulevard and 13th Street. One of the lots Is east of the Crafton Hills Fire Station, and the other west of the fire station.
As part of the March 25, 2019 action, the city council approved along with the sale agreement a land use designation/zoning change that was applicable to the 0.87 acre piece. Last week the planning commission recommended that the city council make the same change to the two other parcels totaling 1.67 acres.
In his capacity as director of community development, Toomey recommended that the planning commission upon conducting a public hearing on December 18 adopt a resolution approving the general plan amendment/land use district change to alter the zoning on both pieces on either side of the fire station to general commercial, make the necessary amendments to reflect the change in the city’s zoning ordinance and find that the commercial project to be built on the property is exempt from the environmental review requirements of the California Environmental Quality Act, despite the consideration that no specific use for the site or sites is planned.
The planning commission did as recommended by Toomey.
Questions attend the city’s action. At issue is whether the city, as the inheritor of the property donated under conditions specified by Ruben and Lester Finkelstein, can defy the Finkelstein Brothers’ wishes as articulated in the deed restriction. Moreover, the timing of sale of the 0.87 acres to JADE,Real Estate Holdings, Inc., four months after JADE made an overture to the city to buy the property, which followed by four months the alleged execution of the termination of deed restriction by the Finkelstein heirs, has pushed some Yuciapa residents to the conclusion that the sales arrangement was riddled with fraud. At issue is the influence that JADE Real Estate Holdings, Inc. has over Yucaipa city officials.
JADE Real Estate Holdings, Inc. is registered in Wyoming as a corporation and in California as a foreign limited-liability company. The filing with the California secretary of state’s office was made on April 9, 2018. The registered agent on file for the company in California is Debra Hanna, with the company headquartered at 25772 Lawton, Loma Linda, California 92354. The company’s principal address is 25772 Lawton in Loma Linda. The company has two principals on record, Hanna, who is shown as residing in Loma Linda, and Janet Jones, who lives in Redlands.
While Jade Real Estate Holdings, LLC was the purchaser of the 0.87-acre parcel, the purchaser or purchaser of the two parcels totaling 1.67 acres has or have yet to be identified, though it has been suggested JADE is the intended buyer.
Persistent suggestions are that JADE or its principals have provided inducements to Yucaipa city officials to obtain the city’s consent to sell the property.
For reasons that are not clear, Yucaipa Deputy City Manager/City Clerk Jennifer Crawford has elected to not post the campaign disclosure filings of Yucaipa’s mayor and city council members on the city’s website, making a determination of whether JADE, Hanna or Jones have made monetary contributions to the campaigns of Yucaipa Mayor David Avila, and council members Denise Allen, Greg Bogh, Bobby Duncan and Dick Riddell difficult.
Nor has Crawford posted on the city’s website the mayor’s or council members’ statements of economic interest, which would reveal if any of the city’s elected leadership has received money from JADE other than campaign donations.
By Mark Gutglueck