In a memorandum to Committee, District Engineer Denis Mulligan and General Manager Celia Kupersmith reported on staff’s recommendation to award Contract No. 2007-B-4, Golden Gate Bridge North Approach Viaduct Suspended Maintenance Scaffolding System, to Safway Services, Inc. (Safway), to purchase a suspended maintenance scaffolding system, for maintenance cleaning and painting of the North Approach Viaduct structures and other structural components of the Golden Gate Bridge, including training and inspection by the manufacturer’s certified technician.

The report provided background information regarding the seismic retrofit work on the North Approach Viaduct, work which did not include maintenance cleaning and painting of the existing steel orthotropic deck and super structure. These maintenance tasks must be performed by District forces as soon as possible, and a suspended maintenance scaffolding system, with full containment, is required in order to carry out the tasks safely, efficiently and in conformance with environmental regulations.

The report further stated that staff prepared plans and specifications for Contract No. 2007-B-4 and advertised bids on October 10, 2006. On Tuesday, November 7, 2006, one bid was received and publicly read. The sole bidder is Safway, with a bid price of $1,459,609.50. Staff has performed a price analysis of the sole bid and determined that the price is fair and reasonable and recommends award of contract to Safway. In addition, there are no Disadvantage Business Enterprise (DBE) requirements applicable to this contract. Safway is not a certified DBE; therefore, no DBE participation is anticipated during the performance of the contract.

After evaluation of the various suspended scaffolding systems on other Bay Area bridges, staff has determined that the Steel QuikDeck System (QuikDeck System), the system included in Safway’s bid, is best suited for application at the Golden Gate Bridge. The QuikDeck System will provide adequate working load capacity, with a level and rigid platform and will provide containment and environmental control for maintenance work. In addition, District forces will be trained by the manufacturer’s certified technician to remove and reinstall the QuikDeck System for maintenance operations at other locations of the Bridge, following completion of the work at the North Approach Viaduct.

This project is included in the FY 06/07 Bridge Division Capital Budget in the amount of $3,000,000 and is 100% District funded. A copy of the report is available in the Office of the District Secretary and on the District’s web site.

At the meeting, Denis Mulligan summarized the staff report and stated that staff is recommending approval to purchase approximately 1½ acres of rigid modular suspended maintenance scaffolding system that can be installed by District forces. He noted that the system has a flush deck for ease of walking and clean-up. He also noted that the scope of work in the contract includes training, as well as periodic inspections to ensure the District forces are proficient with the installation of the QuikDeck System.

Discussion ensued, including the following:

• Director Newhouse Segal inquired as to when the QuikDeck System will be delivered to the District. In response, Mr. Mulligan stated that due to the amount of fabrication associated with the QuikDeck System, staff anticipates delivery in approximately two months.

• Director Grosboll commented that the District received only one bid for this contract and inquired whether the District has previously worked with this company. In response, Mr. Mulligan acknowledged that only one bid was received; however, the sole bid was close to the Engineer’s estimate and was deemed fair and reasonable. He stated that one reason for reduced competition is that there are only a few manufacturers that produce rigid scaffolding systems with a flush deck, as was required in the specifications for Contract No. 2007-B-4. He noted that the District has had no past association with Safway.

Staff recommended and the Committee concurred by motion made and seconded by Directors STROEH/HERNÁNDEZ to forward the following recommendation to the Board of Directors for its consideration:

Status Report on Revenue-Generating Activities on District’s Underutilized or Excess Properties

In a memorandum to Committee, Property Development & Management Specialist Norma Jellison, Director of Planning        Alan R. Zahradnik, Deputy General Manager, Bus Division Susan C. Chiaroni and General Manager Celia G. Kupersmith provided a status report on revenue-generating activities on District underutilized or excess properties, and requested confirmation from the Committee regarding staff’s continuing efforts of leasing rather than selling the District’s assets.  The report also provided the status on the discussions with the City of Novato Redevelopment staff regarding the potential relocation of the Novato Bus Lot.

The report stated based on the 2004 direction of the Committee to generate lease revenue from District’s underutilized or excess properties and in furtherance of the strategic planning process to meet the deficit reduction targets, as outlined in the FY 06/07 Budget, including a strategic planning initiative program that would lease underutilized property resources to raise revenues in future years, staff has marketed the District’s underutilized or excess real estate assets.  Resulting revenues from underutilized or excess properties include:

1. License Agreement for a portion of the San Francisco bus lot for a weekend flea market (San Francisco Open Bazaar);
2. Lease of former Park & Ride Lot in San Rafael for an RV and boat storage facility; and,
3. Lease of a portion of undeveloped area behind the San Rafael employee parking lot for new vehicle storage.

The annual revenues represented by the above-listed real estate transactions on underutilized properties total $250,308 per year, with a projected five-year revenue total of $1,251,540. This projected revenue would meet the five-year deficit reduction goal of $1 million. The report noted that the San Francisco Open Bazaar is experiencing start-up difficulties and if it fails, would have a significant impact on meeting the five-year goal. The report also noted that staff has been cooperating with the consultants for the City of Novato Redevelopment Agency to move forward with the studies and analysis of the potential relocation of the District’s Novato Bus Lot, in furtherance of the Memorandum of Agreement between the District and the City.

The report also stated that in the 2004 Report to Committee, an undeveloped portion of the Santa Rosa Bus Lot was identified as underutilized or excess to District needs and staff began marketing for a potential lease. When response was minimal, staff solicited a Professional Services Agreement (Agreement), awarded to North Bay Commercial Real Estate, Inc., for real estate brokerage services, with a term ending on December 31, 2006. North Bay Commercial Real Estate, Inc., undertook intense marketing activities, including listing the property on the internet, sending flyers/leaflets by mail and networking with interested parties; however, no interest has been shown. The report further noted that the Agreement with North Bay Commercial Real Estate, Inc., does not require any payment for services performed until a property lease is executed.

The report further stated that in a recent re-evaluation of the undeveloped area of the Santa Rosa Bus Lot, staff has now identified an additional one acre, increasing the land available for lease to 2.5 acres. This would retain 8 acres for any possible future bus operations. More than one acre of these remaining 8 acres is undeveloped, affording adequate space for reconfiguration or expansion, if needed. Staff plans to continue marketing the 2.5-acre undeveloped area for lease or ground lease, although staff is not optimistic that this will be successful. The report further noted that if staff were directed to place this property up for sale, based on recent market analysis, the 2.5-acre property in Santa Rosa could generate between $1.3 and $1.6 million. A copy of the report is available in the Office of the District Secretary and on the District’s web site.

At the meeting, Norma Jellison provided a summary of the staff report and stated that leases and licenses associated with the District’s real estate assets, including the leases of underutilized real estate assets, generate approximately $815,000 per year in revenue. She noted that this figure includes the additional revenue generated from the recent leases for the underutilized properties in San Francisco and San Rafael. She described staff’s successes in regards to leasing underutilized properties in San Rafael and Santa Rosa, as well as described staff’s challenges in finding parties interested in leasing the undeveloped property at the Santa Rosa site. She stated that staff is seeking Board direction to continue the pursuit of obtaining a lease for the Santa Rosa site.

Discussion ensued, including the following:

• Director Stroeh inquired as to whether the properties identified as underutilized or excessive have been purchased with state or federal funds. In response, Ms. Kupersmith stated that some the properties have been purchased with federal funding, although the underutilized or excess property identified in Santa Rosa is wholly owned by the District and no federal funds were involved. She noted that the District would be required to return any federal funding from the sale of properties purchased with federal or state funds.

• Director Moylan inquired as to whether the District had a potential use for the undeveloped property in Santa Rosa. In response, Ms. Kupersmith stated that staff has determined that 2.5 acres of the Santa Rosa property likely will remain excessive to the District’s foreseeable future needs.

• Director Martini made the following comments and inquiries:
  • He commended staff for their presentation on the status of the District’s underutilized properties, as well as staff’s accurate portrayal of the challenges to obtain a ground lease for the property located in Santa Rosa. He commented that the Santa Rosa property is located in a light industrial land use area which is problematic for pursuing a ground lease. He noted that the market for leasing commercial land has significantly diminished.
  • He commented that, although staff has determined that there is no foreseeable use for the underutilized property in Santa Rosa, in his opinion, it would not be prudent to sell the property in the current market. He noted that the property is not losing money and that it would behoove the District to wait until the property appreciates, and not aggressively pursue a ground lease for the property in the current market.
  • He requested staff to perform an analysis of the comparative benefit, if any, of investing the proceeds from selling the Santa Rosa property for the District’s investment portfolio.

• President Middlebrook made the following comments and inquiries:
  • She inquired as to whether the market was strong enough to obtain a lease from other interested parties for the San Francisco Bus Lot, in light of the start-up difficulties for the San Francisco Open Bazaar. In response, Ms. Jellison stated that it would be very challenging to secure any alternative new lease at this location, due to its availability only at night and on weekends. Ms. Kupersmith added that the San Francisco Bus Lot is configured for bus operations, limiting its use for commercial purposes.
  • She commented that the loss of this particular lease would have a significant impact on the District’s five-year goal to increase revenue with property leases. In response, Ms. Kupersmith stated that the District is at the beginning of the five-year time period and other leasing opportunities may present themselves elsewhere, during that period. She added that staff will update the Committee and the Board regarding key issues and developments, and will present any recommended actions for consideration.

• Director Grosboll made the following comments and inquiries:
  • He inquired as to whether the projected timeframe in which the underutilized Santa Rosa property will not have a foreseeable use for the District spans over the next 20 years. In response, Mr. Zahradnik stated that currently bus passenger counts from Santa Rosa have fallen off and could improve with population growth; however, staff does not foresee opportunities in the immediate future for expanded bus service from that location. He also stated that the only foreseeable need for the 2.5 acres of underutilized property in Santa Rosa would be if the District chose to convert the site into a full bus maintenance facility. However, Mr. Zahradnik noted that, with the remaining 8 acres of property designated for District use, of which over one acre is undeveloped, the District could accommodate a future growth in service, including the construction of a fueling station for alternative fuels. Mr. Zahradnik also pointed out that this Bus Lot was built to house 50 buses and currently only 30 buses are housed there.
  • He inquired as to whether the projected five-year revenue total of $1,251,540 includes expenses, such as insurance, that could offset the projected revenue. In response, Ms. Jellison stated that, as part of the lease agreements, all lessees are required to carry insurance, naming the District as additional insured and to indemnify the District and the lessees are responsible for all utilities, permits and operating costs associated with their use of District property.
    

• Director Boro made the following comments and inquiries:

  • He inquired as to whether any parties have shown interest in leasing the remaining undeveloped property that is available in the rear of the San Rafael employee parking lot adjacent to Interstate 580. In response, Ms. Jellison stated that of the 90,000 square feet of undeveloped property, the District has leased 30,000 square feet to Toyota of Marin for storage of new vehicles. She further stated that there is remaining space available, and no interest has been expressed by outside parties to lease that remaining space. She noted that the criterion required by the City of San Rafael to use the property includes screening from the freeway, as well as compliance with environmental regulations.
  • He inquired as to whether or not the lease with the RV and boat storage facility is consistent with the zoning requirements with the City of San Rafael. In response, Ms. Jellison stated that both the RV and boat storage on the former Park and Ride Lot and the new vehicle storage on the undeveloped property in the rear of the San Rafael employee parking lot are located in a light industrial zone and have been permitted by the City of San Rafael.

Action by the Board – None Required

Discussion ensued, including the following:

• Director Boro commented that the newly formed Committee will address the key issues regarding the future campaign of Measure R and present its findings and recommendations to the SMART Board. He noted that, although Measure R did not receive the two-thirds majority vote, the results show a strong indication that both counties support it. Director Boro also stated that he met with Measure R stakeholders, including the Mayor of Larkspur, to resolve some of the issues that were brought up during the campaign.

  Action by the Board – None Required

In a memorandum to Committee, Deputy District Engineer Ewa Z. Bauer, District Engineer Denis Mulligan and General Manager Celia Kupersmith reported on current engineering projects. A copy of the report is available in the Office of the District Secretary and on the District’s web site.

Action by the Board – None Required