Efforts to revive the dilapidated Lompoc Theatre cleared another hurdle Friday morning when a panel took a step toward removing a $700,000 lien and transferring ownership of the property to the community group leading the restoration project.
There still are several other milestones before the Lompoc Theatre finally is untangled from the legal web stemming from the collapse of the nonprofit Lompoc Housing & Community Development Corporation (LHCDC) and complicated by the state’s elimination of redevelopment agencies.
On Friday, the RDA Oversight Board — a panel to handle property that belonged to the old Lompoc Redevelopment Agency — adopted a resolution that essentially agrees to eventually forgive the loan and lift the lien for a fee of $1. Eliminating the lien then sets the stage for LHCDC to hand over ownership to the community group.
“We are exhilarated,” said Mark Herrier, president of the Lompoc Theatre Project, a group working to revive and renovate the old facility. Herrier grew up in Lompoc and appeared in the Porky’s series of films in the 1980s.
But he tempered the excitement, noting Friday’s action was one of several still needed before the nonprofit group finally takes possession of the property.
“That doesn’t mean it’s over,” Herrier said. “We still have to work out some details and a lot of times the devil is in the details.”
The LHCDC acquired the old theater building in the 100 block of North H Street in 2006 for $850,000 and had plans to restore it, city officials said in a staff report. But the plans fizzled amid allegations of financial mismanagement for the now-defunct nonprofit organization.
In 2011, Gov. Jerry Brown ordered the elimination of redevelopment agencies with special oversight boards created to handle transferring property for the successor agencies. Redevelopment agencies were formed to direct property taxes to special government organizations to remove blight in cities. Typically, a city council also served as redevelopment agency board.
In its resolution adopted Friday, the Oversight Board determined it “would be in the best interest of the taxing entities to release liability in the property.”
The panel cited a Sept. 18, 2014 appraisal that claims the property actually has a negative value.
If empty, the land would be worth $700,000, according to the report by Santa Maria-based Reeder, Gilman & Associates.
“However, the subject property is not vacant and unimproved, and the existing improvements require demolition and removal,” the appraisers said.
Demolition of the structure would cost $800,000, creating a final value of minus $100,000, the appraisal report noted.
“The existing structure has no economic value,” the appraisers’ report said. “In fact, it has a negative value of demolition.”
The appraisers contend the costs of a new theater building at about $220 per square foot would run approximately $2.3 million. However, the community group’s proposed renovation plan equates to $440 per square foot, according to the appraisal report.
Last month, the Lompoc Theatre Project unveiled plans to restore and expand the existing structure for $5 million, money they intend to get through donations, fundraisers and grants. They ambitiously hope to mark the building’s 90th anniversary in 2017 with the completion of renovations.
While the negative appraisal could be viewed as daunting, Herrier said they see as a sign of just how well-developed the theater building is based on a demolition estimate.
Demolishing a building with historical status wouldn’t be simple, he noted.
“Luckily for all of us, the only viable option is that it remain a theater there,” Herrier said.
In the resolution adopted Friday, the Oversight Board said restoration plans actually would be positive for other agencies that receive property taxes.
“Should the property be transferred to an organization willing to assume this liability and rehabilitate this property, the property’s value would increase and the taxing entities would receive increased property tax revenues and potentially, increased sales tax revenue due to increased activity in the downtown area,” the Oversight Board noted.
While the California Department of Finance has blessed the steps needed for eliminating the lien and transferring the building to the Theatre Project, the matter still must return to the state agency for final approval, Herrier said. He expects to get the state’s approval within 90 days.
However, the Oversight Board wants some matters addressed, such as how the property title will be given to the defunct LHCDC and then handed over to the new owners.
Lompoc Theatre Project members were not deterred by those final questions Friday.
“The bottom line is we’re going forward,” Herrier said. “This was a big one and we got past it.”