Agenda

Return

C. 41

To:	Board of Supervisors
From:	Julia R. Bueren, Public Works Director/Chief Engineer
Date:	July 12, 2016

Contra

Costa

County

Subject:

Lease of a to-be-constructed building near Gateway Ave. in San Pablo

APPROVE	OTHER
RECOMMENDATION OF CNTY ADMINISTRATOR	RECOMMENDATION OF BOARD COMMITTEE

Action of Board On: 07/12/2016

APPROVED AS RECOMMENDED

OTHER

Clerks Notes:

VOTE OF SUPERVISORS

AYE:

Candace Andersen, District II Supervisor
Mary N. Piepho, District III Supervisor
Karen Mitchoff, District IV Supervisor
Federal D. Glover, District V Supervisor

ABSENT:

John Gioia, District I Supervisor

Contact:

David Silva, (925)313-2132

I hereby certify that this is a true and correct copy of an action taken and entered on the minutes of the Board of Supervisors on the date shown.
ATTESTED: July 12, 2016
David Twa,

BY:	, Deputy

RECOMMENDATION(S):

AUTHORIZE the Public Works Director, or designee, to execute a ten-year lease with the City of San Pablo to lease a building that is to be constructed by the City of San Pablo on approximately 5.88 acres near Gateway Avenue in the City of San Pablo for use by the County’s Health Services Department – Women, Infants & Children Program. Based on the estimated size of the building (7,000 square feet) and the negotiated price per square foot, the annual rent for the first year is estimated to be $155,400, with annual step-ups each year thereafter. After the initial ten-year term, the County will have the option to renew the lease for two additional ten-year terms.

FISCAL IMPACT:

100% General Fund.

BACKGROUND:

The Health Services Department – Women, Infants & Children Program (WIC) is a federally-funded health and nutrition program that helps pregnant and postpartum women, infants and children under five years old to eat healthy foods and live a healthy, active life. WIC is the last occupant of the old Richmond Health Clinic in Richmond, as all other services have relocated to the new West County Health Clinic in San Pablo. The Richmond Health Clinic is slated to be disposed of as surplus property. The City of San Pablo (City) owns the vacant land adjacent to the West County Health Clinic. Under the terms of the lease, the City will construct an approximately 7,000 square foot building on the vacant lot and lease the entire building to the County for the WIC program. The City is responsible for the cost of constructing the building. The City is also providing the County with a $25 per-square-foot allowance for tenant improvements. The County is responsible for the cost of tenant improvements in excess of that amount.

The exact location of the building on the vacant lot is not yet known but will be determined by the mutual agreement of the City and the County. In addition, the City and County must agree on the final plans that are to be used to construct the building. The actual size of the building will be determined based on the final plans. Finally, the City and the County have agreed on the rental price per square foot. Based on the estimated size of the building and the agreed upon rent per square foot, the estimated rent for the first year is $155,400, with annual increases thereafter.

The initial term of the lease is ten years. The County will have two ten-year renewal options and a right of first refusal to purchase the building. The County will be responsible for the cost of maintaining and operating the building.

CONSEQUENCE OF NEGATIVE ACTION:

If this lease is not approved, the County will have to find an alternative location for the operation of the WIC program. An alternative location will result in the WIC program being further away from the site of other services provided by the County at the West County Health Clinic. And finding a new location will result in the County incurring additional expenses.