(a) In the event a lot or parcel of property fails to sell for the minimum price required by Section 8832, the city may petition the court to modify its judgment and authorize the property to be sold at a lesser minimum price or without a minimum price.
(b) Written notice of hearing on the petition under subdivision (a) shall be given by certified or registered mail to all registered owners of any outstanding bonds secured, in whole or in part, by the delinquent assessment or reassessment, to the original purchaser of any of the bonds from the city, to the city treasurer, and to any authenticating agents, transfer agents, registrars, and paying or other agents of the city appointed with respect to any of the bonds. If any of the outstanding bonds are payable to bearer and not registered to other than bearer, notice of the hearing shall also be given by publication at least once in a financial publication with national circulation and additionally as the court shall reasonably require. The hearing shall be held not earlier than 10 days after the notice is given.
(c) The court may, after a hearing held pursuant to notice as provided for by subdivision (b), modify the judgment and authorize the property to be sold at a lesser minimum price or without a minimum price, if the court determines, based on the evidence introduced at the hearing, any of the following:
(1) Sale at the lesser minimum price or without a minimum price will not result in an ultimate loss to the bondholders.
(2) Owners or holders of 75 percent or more of the outstanding bonds, by principal amount, have consented to the petition and the sale will not result in an ultimate loss to the nonconsenting bondholders.
(3) Owners or holders of 75 percent or more of the outstanding bonds, by principal amount, have consented to the petition and all of the following apply:
(A) By reason of determination pursuant to Section 8769, the city is not obligated to advance available funds to cure a deficiency.
(B) No bids equal to or greater than the minimum price have been received at the foreclosure sale.
(C) No funds remain in the special reserve fund, if any.
(D) The city has reasonably determined that a reassessment and refunding proceeding is not practicable, or has in good faith endeavored to accomplish a reassessment and refunding and has not been successful, or has completed reassessment and refunding arrangements which will, to the maximum extent feasible, minimize the ultimate loss to the bondholders.
(E) No other remedy acceptable to owners or holders of 75 percent or more of the outstanding bonds, by principal amount, is reasonably available.
(d) The assessment or reassessment lien upon property sold pursuant to this section at a lesser price than the minimum price shall be reduced by the difference between the minimum price and the sale price.
(e) The court shall permit participation by the bondholders in its consideration of the petition as necessary to its determinations.
(f) Neither the property owner nor the holder of a security interest in the property, nor any other defendant in the foreclosure action, nor any agent thereof, may purchase the property at the foreclosure sale for less than the minimum price determined pursuant to Section 8832. Each purchaser at less than the minimum price shall certify in writing to the levying officer at the sale the purchaser’s compliance with the requirements of this subdivision.
(g) The court may make provisions for the payment of attorney fees and costs incurred in proceedings pursuant to this section as the court deems proper, and need not require that the fees and costs be paid out of the proceeds of any sale authorized pursuant to this section.
(Added by Stats. 1988, Ch. 959, Sec. 11.)