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OCII holds FY2016-17 budget workshop, flags $99,000 administrative fee and SB 107 bond plans
Summary
OCII presented a $15.4 million FY2016‑17 operating budget and discussed a $99,000 gap from an unexpected 10% Administrative Services fee; staff also outlined planned bond issuances enabled by SB 107 and asset‑transfer priorities such as Yerba Buena Gardens and Shoreview Park.
OCII staff presented the second of two workshops on the agency’s FY2016‑17 operating and asset management budget on April 19 and sought commissioner guidance on how to handle a $99,000 shortfall that resulted from an Administrative Services (ADM) 10% fee on six FTE contracted back to OCII.
Deputy Director Brie Mahorder said OCII’s overall operating budget is $15,400,000 and noted that only $5.3 million of that would be paid from property‑tax increment, with the bulk of operations funded by developer payments and other sources. Mahorder said OCII is requesting 2% of total tax increment for administrative costs, below the 3% allowed by law.
Staff explained the $99,000 imbalance stems from ADM’s new 10% administrative charge assessed on labor costs for six employees who are technically city staff contracted back to OCII. Mahorder presented three policy options: seek an amendment to the ROPS/ACA to request additional authority, negotiate the fee or timing with Administrative Services, or reduce expenditures elsewhere. Commissioners and staff discussed timing constraints (one amendment to recognized obligations payment schedule allowed per year) and signaled a preference to negotiate invoice timing or fee rather than immediately use the single amendment opportunity.
On debt and capital financing, staff explained that SB 107 enables certain successor agencies to issue new tax allocation bonds. OCII staff outlined planned issuances next year, including roughly $103 million in housing bonds (to fund about 730 units in Mission Bay South and Hunters Point/Candlestick Point) and $37 million for Transbay infrastructure (Folsom Streetscape, Underramp Park, Essex Park, and Transbay Park). Staff also described two refundings intended to lower interest costs and free up future bonding capacity.
Christine Maher, Real Estate and Development Services Manager, reviewed asset management priorities under the Department of Finance‑approved Long Range Property Management Plan (PMP). Priority transfers this year include Shoreview Park (to Recreation and Parks), the Fillmore Heritage Center commercial parcel and garage, and Yerba Buena Gardens. Maher said the Yoshi’s restaurant space on Fillmore remains vacant, OCII retains ownership of the commercial parcel, and the city has stepped in as master tenant and launched short‑term activation programs (which currently exclude the Yoshi’s restaurant for liability reasons).
During public comment, representatives of the Fillmore community urged more direct engagement and criticized past development approaches; a neighbor also urged more open space and neighborhood‑sensitive planning for 72 Townsend. Commissioners asked clarifying questions about Yoshi’s, certificate‑of‑preference marketing for affordable units, and next steps for handling the ADM fee.
Staff said they will pursue discussions with ADM about invoice timing and will reserve a potential ROPS amendment for September if necessary. Commissioners indicated they prefer to avoid a premature amendment and to seek negotiated timing or a lower fee.
