Mud-damaged home up for bid

CITY HALL — Officials on Monday announced the upcoming auction of one of five homes acquired by the city as a result of a $12-million settlement to homeowners whose properties were damaged in a January 2005 mudslide.

The mudslide Jan. 10, 2005, in the 1600 block of Gladys Drive came down onto Glenmore Boulevard during heavy rains, causing severe damage to several properties and forcing several residents to evacuate.

Nine residents filed lawsuits against the city, claiming shoddy construction of storm gutters with inadequate capacity to handle the rains.

A public auction will be held Aug. 24 for the parcel at 1338 N. Jackson St. — one of five acquired through the settlement. The city will continue to own four other propertiesas construction continues in the area.

Any funds raised in this month's auction would go toward filling a deficit in the city's liability insurance fund, which was hit hard by the massive payouts, officials said. The city has also filed a lawsuit against American International Group, claiming the insurance company failed to cover and investigate the claims.

The 9,260-square-foot property contains a residence and detached garage, although the structures were severely damaged during the mudslide. It will be sold "as-is."

At the auction, initial bids will start at $200,000, officials said, but the City Council is not required to accept any offer.

"It's a situation of let's see what happens and see what it gets," said Public Works Director Steve Zurn.

The City Council voted to approve the sale at last week's council meeting.

"I hope people will take advantage of this opportunity," Councilman John Drayman said. "Once purchased and cleared, that will be a terrific home site. That's an exciting, tiny bit of lemonade squeezed out of a lot of lemons."

Any prospective bidders can inspect the property Aug. 10, officials said. To bid on the property, interested parties must submit a 10% deposit in cash, cashier's check or certified check to the city clerk's office before the auction.

To make an appointment to view the property, contact the city engineer at (818) 548-3945.

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