LAFCO adopts final municipal service review for San Mateo County Harbor District; urges improved planning and meeting accessibility

San Mateo Local Agency Formation Commission on March 19 adopted the final municipal service review (MSR) for the San Mateo County Harbor District, finding the district able to cover ongoing operations but noting substantial unfunded capital needs and public concerns about recent land acquisitions and transparency.

The commission’s final MSR, presented by LAFCO management analyst Rob Bartoli, states the Harbor District receives about 70% of its revenue from property taxes and identified roughly $80 million in capital projects, with approximately 15% of that funding identified as of August 2024. Bartoli said those capital costs “may require finding multiple funding sources such as grants and loans,” and that annual revenues are insufficient to fully fund the listed projects.

The MSR also documents public comments received during the review. Sid Young and other speakers at the meeting said they were concerned about the district’s purchase of several parcels in El Granada and a related request for proposals for a Burnham Strip parking project, arguing the buys occurred with limited public notice. A member of the public who identified himself as long-time harbor-area observer said the district "spent that money on property instead of maintaining the property they had," urging the commission to examine deferred maintenance. Kathleen Slater Carter, identified at the meeting as Harbor District board president, was present and offered to answer commissioners’ questions.

The staff report records that the district has improved financial transparency and budgeting practices since a 2015 review, that ongoing operations and maintenance are currently covered by existing revenues and enterprise activities, and that the district remains heavily reliant on property tax revenue. The report recommends the Harbor District update its 2019 strategic plan and master plan to align with the most recent capital improvement plan, reassess recent land purchases, and identify potential funding sources for capital projects.

The MSR also recounts comments from county staff. Gerson Kelly, manager of the San Mateo County Airports, told LAFCO staff the county is not supporting any Harbor District proposal to assume operation of San Carlos or Half Moon Bay airports; the county has not discussed such a transfer with the district and believes maintaining county oversight is in the public interest. Bartoli noted that under the California Harbors and Navigation Code (section cited in staff slides as “6000, etc.”) harbor districts do not have airport powers without reorganization or special legislation, and that any change could require reorganizing the district or a countywide vote.

After discussion, the commission voted to adopt the final MSR. Commissioners also approved a separate recommendation directing staff to prepare a LAFCO statement encouraging public agencies to make meetings accessible to people with access and functional needs, and to return that language to the commission via the policy committee. Chair Mueller moved the adoption; the motion and the accessibility direction passed on roll call.

The LAFCO report notes two written comments on the MSR: one from Gerson Kelly (San Mateo County Airports) and one from John Ullam, a member of the public, both summarized in staff materials. A letter from Sid Young received the day before the meeting is included in the staff packet and is summarized in the MSR as raising transparency issues about a recent presentation before the Midcoast Community Council and about the district’s use of a request for proposals for the Burnham Strip project.

The commission’s actions on the MSR are recommendations and advisory; the MSR does not itself change Harbor District powers, budgets or land ownership. Staff told commissioners any change in powers (for example to operate airports) would require a separate LAFCO reorganization proposal that evaluates fiscal and operational capability and is subject to community and agency comment.

The commission recorded the MSR adoption and the accessibility direction as formal actions in its minutes. Staff said the Harbor District has begun work on an updated strategic plan and a public meeting on that plan was scheduled for April 8, according to district representatives in the room.

The commission moved on to other agenda items after the vote.