Supervisors approve 20‑year lease for Twin Peaks service station, conditioned on biofuel grant

The Board of Supervisors approved a resolution July 30 authorizing the director of property to enter into a 20‑year lease with Twin Peaks Petroleum Inc., doing business as Twin Peaks Auto Care, for about 14,000 square feet at 598 Portola Drive. The initial base rent is set at $157,000 with annual 3% adjustments and one 15‑year extension option. The lease was approved 9–1.

Supervisor Myrna Melgar, who introduced the item, said the parcel is an odd‑shaped, city‑owned site at the top of the hill that has been leased to the legacy gas station for decades and that the business needs a long lease to amortize the cost of required tank replacement mandated by the state. Melgar said the owner will seek a state grant — available through state and federal programs — to transition pumps to biofuels and that acceptance of the grant is a requirement of the lease. She said the lease also requires cleanup at the end of the term, which the current lease does not require.

Supervisor Preston cast the lone no vote, saying he opposed extending lease terms on public land for fossil fuel uses and noted environmental groups that oppose the renewal. Melgar said city staff and her office evaluated other options, including affordable housing, community garden, or other retail, and found the site’s configuration, cleanup costs and federal funding restrictions made those alternatives infeasible.

Roll-call on the record showed nine ayes and one no. The resolution was adopted.

Why it matters: The item extends a long-term lease of city land for a gas station at a prominent site visible to tourists and neighbors, with the lease conditioned on a state/federal grant to support a transition to biofuels and a required end-of-lease cleanup obligation.

What’s next: The lease requires the owner to secure the state grant and complete the conversion work; ongoing monitoring will be the responsibility of the Port/Property departments.