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Committee advances AirTrain contract, prevailing-wage update and sends 1440 Harrison lease to full Board without recommendation

San Francisco Board of Supervisors Budget and Finance Committee · February 2, 2017
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Summary

The committee approved a Bombardier AirTrain modification and a new prevailing-wage classification, advanced a tax-auction procedural resolution, and sent the HSA's 1440 Harrison lease renewal to the full Board without recommendation after questions about a nearly 194% rent increase and the SFUSD master lease that extends through 2040.

The Budget and Finance Committee took several administrative and fiscal actions Thursday and forwarded a contested lease renewal for further Board consideration.

Item 8: Bombardier/AirTrain modification Kathy Weidner of the San Francisco International Airport described a contract modification that exercises a one-year option for Bombardier to operate and maintain the AirTrain and to replace obsolete parts. The Budget Analyst recommended approval of the roughly $14.9 million increase and the committee sent the item to the full Board with a positive recommendation.

Item 9: Prevailing wage classification Pat Mulligan of the Office of Labor Standards & Enforcement presented a new prevailing-wage classification for workers who load and unload materials at special events and for drivers tied to a Teamsters bargaining package. Supervisors asked for a benefits breakdown; Mulligan agreed to provide details to Supervisor Yee's office. The committee approved the classification with a positive recommendation.

Item 10: Tax-defaulted property auction The Treasurer's office asked the committee to authorize the sale at public auction of tax-defaulted parcels; staff said most parcels are small slivers or timeshares and that auctions support local revenue. The committee moved the resolution forward with a positive recommendation.

Item 11: HSA sublease at 1440 Harrison HSA and Real Estate staff presented an eight-year, three-month initial renewal (with two five-year options) of the Human Services Agency sublease at 1440 Harrison, proposing $63 per square foot with 3% annual increases. The Budget Analyst calculated the rent rise from about $23/sf to $63/sf as roughly a 194% increase and noted the city's sublease is constrained by a master lease held by the San Francisco Unified School District that extends through 2040, with renewal and appraisal mechanics that could trigger arbitration. Supervisors expressed concern about the steep increase and the lack of an exploration of alternatives; Supervisor Tang offered an amendment clarifying extension terms recommended by the BLA. The committee sent the lease to the full Board without recommendation so that members can review additional due diligence.

Next steps: Items 8, 9 and 10 will be considered by the full Board with the committee's recommendations; the 1440 Harrison lease will return to the Board for fuller debate and possible additional negotiation.