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CITY OF SAN MATEO
Agenda Report
City Hall
330 W. 20th Avenue
San Mateo CA 94403
www.cityofsanmateo.org
Agenda Number: 24 Section Name: {{section.name}} Account Number: 10-3133 File ID: {{item.tracking_number}} TO: City Council
FROM: Alex Khojikian, City Manager
PREPARED BY: Community Development Department
MEETING DATE: August 19, 2024
SUBJECT:
Worker Resource Center at 171 North Amphlett Boulevard – Lease Amendment RECOMMENDATION:
Adopt a Resolution to appropriate $5,000 from the General Fund to the Worker Resource Center Fund to cover the additional cost of leasing the property at 171 North Amphlett Boulevard; approve Amendment No. 1 to the lease agreement for the property at 171 North Amphlett Boulevard for a period of one year at the rate of $5,627.54 per month for use as the Worker Resource Center; and authorize the City Manager to execute the lease amendment in substantially the form presented.
BACKGROUND:
The Worker Resource Center (WRC) is a facility that links day laborers to potential employers. The facility was established in order to address the issue of day laborers congregating on the street and to provide services to help them negotiate a fair wage for their work. The WRC has been located at 171 North Amphlett Boulevard (171 N. Amphlett) since 2020. The WRC previously operated out of a repurposed trailer on the City-owned surface parking lot at 5th Avenue and Railroad Avenue, prior to the redevelopment of the site as a parking garage as part of the Kiku Crossing affordable housing development.
The City contracts with Samaritan House to staff and operate the WRC and provides them with the facility for their use.
The term of the current operations contract with Samaritan House, with a not-to-exceed amount of $195,000 per year, runs through June 30, 2025.
On August 17, 2020, the City Council approved the lease of the 2,700 square-foot commercial space located at 171 N.
Amphlett at a rate of $5,000 per month for the space, plus an additional $410.39 per month for common area maintenance fees, for a total annual cost to the City of $64,925. The lease is a triple net lease, which means that the City is responsible for the utility costs and for any minor interior repairs, such as plumbing or electrical issues in the space.
Since the FY2020-21 Budget cycle, funds for the lease have been budgeted in the Community Development Department’s General Fund budget for the Worker Resource Center. The lease contained an option for three one-year extensions, with an increase of 3 percent for each extension. The third and final extension under the current lease expires August 31, 2024.
The current (2023-24) rent plus common area maintenance fees is $5,912 per month, or $70,952 for one year.
The owner of 171 N. Amphlett has agreed to continue to rent the space to the City for operation of the WRC for an additional 12-month period under the same terms as the current lease, with a three percent increase in the monthly rent and common area expenses. Samaritan House is also supportive of continuing to operate the WRC out of the 171 N.
Amphlett space. The lease rate of $5,627.54 per month for the space, plus an additional $462 per month for common area
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maintenance fees, results in a total annual cost of $73,075.
Staff recommends that the City Council approve the lease extension, as this will allow Samaritan House to continue operating the WRC without disruption and bring the lease term into alignment with the term of the operations agreement with Samaritan House, which runs through June 30, 2025.
As part of Community Development’s Fiscal Year (FY) 2024-25 Budget, $69,000 from the General Fund were allocated to fund the continued lease of this building for use as the WRC. To fund the three-percent increase, an additional appropriation of $5,000 from the General Fund, for a total annual cost of $74,000, is necessary to support monthly rent and common area expenses for the full 12-month lease period. A resolution for a supplemental appropriation of $5,000 is included as Attachment 1 and the Lease Agreement Amendment is included as Attachment 2.
During this 12-month period, staff will work with the owner of 171 N. Amphlett and Samaritan House to negotiate a new lease and operations agreement and return to the City Council in the spring/summer of 2025 to seek approval of these agreements.
BUDGET IMPACT:
The negotiated lease rate is $5,627.54 per month for the space plus an additional $462 per month for common area maintenance fees. The total annual cost to the City is $73,075 from the General Fund. In Community Development’s FY 2024-25 Budget, $69,000 from the General Fund was appropriated to pay for costs associated with the rental of 171 N.
Amphlett. The attached resolution appropriates an additional $5,000 from the General Fund to cover the full 12-month lease period.
ENVIRONMENTAL DETERMINATION:
This lease is categorically exempt from CEQA as an “existing facility,” because it consists of the operation, repair, maintenance, permitting, leasing, licensing, or minor alteration of existing public or private structures, facilities, mechanical equipment, or topographical features, involving negligible or no expansion of use. (CEQA Guidelines Section 15301.)
NOTICE PROVIDED:
All meeting noticing requirements were met.
ATTACHMENTS
Att 1 – Proposed Resolution
Att 2 – Amendment No. 1 to the Lease Agreement for 171 North Amphlett Boulevard
STAFF CONTACT
Rachel Horst, Housing Manager
[email protected]
(650) 522-7223