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Supervisors Refer Two Parking Garage Leases After Debate Over Nonprofit Management and Costs
Summary
The Budget & Finance Committee referred two SFMTA parking garage lease agreements — for the Japan Center and Sutter Stockton garages — to the full Board without recommendation after testimony from merchants and neighborhood leaders defending nonprofit management and questions from supervisors about annual management costs and governance.
The San Francisco Board of Supervisors— Budget & Finance Committee on Wednesday referred two proposed lease agreements with neighborhood nonprofit garage corporations to the full Board without recommendation after sharply different views from supervisors and extensive public comment.
Ed Ryskin of the San Francisco Municipal Transportation Agency told the committee the leases are standardized documents created after a 2011 controller—s audit and changes following the 2008 Proposition A that allowed the MTA to issue its own debt. The proposed leases would keep the Japan Center Garage Corporation and the Uptown Parking Corporation in place as the local managers of their respective garages while enabling citywide capital financing and oversight.
Chair Supervisor Mark Farrell said the committee supports neighborhood input but repeatedly asked why the city—s MTA could not perform the day-to-day management functions rather than pay outside nonprofit corporate managers. Farrell cited management cost figures mentioned in the hearing, including roughly $276,000 per year in corporate management costs and about $125,000 for accounting for a Japan Center-related entity, and asked whether an unpaid advisory board could provide the same community voice.
Supporters from Japantown and downtown business districts told the committee the nonprofits produce measurable economic and community benefits. Claudine Chang, legal counsel for the Japan Center Garage Corporation, said the garage has contributed more than $1.1 million annually to the city—s transportation fund and cited a 70.7 percent sales-tax increase in the Japan Center area compared with a city average of 4.2 percent. Haegen Choi, board chair, and multiple merchants emphasized the board—s role in coordinating events (Cherry Blossom Festival, Nihonmachi Street Fair), addressing operational issues quickly for local businesses and preserving neighborhood cultural ties.
"If the Board is replaced by the advisory committee, the level of input will be advisory only, and is not the same," Haegen Choi said in public comment.
Opposing supervisors said the nonprofit structure appears to create a middleman that draws city funds for services the MTA could provide. One committee member said he saw "no quantifiable" public benefit to justify the annual payments; another said he was uncomfortable approving what appeared to be unquantified activity and preferred to send the leases to the full Board for further consideration.
Following the public comment and questions, the committee adopted technical amendments and referred both Item 4 (Japan Center Garage lease) and Item 5 (Sutter Stockton lease with Uptown Parking Corporation) to the Board of Supervisors without recommendation. The committee record shows no roll-call vote against the referral.
What happens next: The leases will appear on the full Board agenda where supervisors can debate the policy question further and decide whether to approve the contracts as amended, approve them with conditions, or reject them.
