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Committee backs PUC lease with Mission Valley Rock, citing permitting and operational ties
Summary
The committee recommended approval of a 25-year lease for Mission Valley Rock on PUC-managed parcels, with annual rent of $60,000 and 4% annual increases; the PUC declined competitive bidding citing county permits and operational integration and the budget analyst found the noncompetitive approach reasonable.
The Budget & Finance Committee on Sept. 9 voted to forward a proposed 25-year lease between the San Francisco Public Utilities Commission and Mission Valley Rock for the S & P 24 premises, with an initial annual rent of $60,000 and annual 4% increases.
A PUC presenter told the committee the lease includes an early termination option exercisable by either party after five years and covers additional operational uses (water management, aggregate conveyance and water storage) rather than mineral extraction. The PUC estimated total revenues over the 25-year term at about $2,498,754.
The PUC explained it did not competitively bid the lease, telling the committee that Mission Valley Rock holds relevant Alameda County permits, owns a portion of the land covered by the permit and integrates the parcel operationally with its existing quarry. PUC staff said re-bidding would risk disrupting aggregate conveyance and might put about $1.1 million in royalty revenues from another site at risk.
The budget analyst, presenting the report, said the PUC—s determination that noncompetitive bidding was reasonable was supported and recommended approving the resolution. There was no public comment; the committee moved the item forward to the full Board of Supervisors with a positive recommendation.
Peter Somerville of the Treasure Island Development Authority introduced earlier Treasure Island lease items during the meeting but the Mission Valley Rock presentation was made by PUC staff.
