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Committee forwards proposed 20-year Bayshore lease for SFMTA operations amid questions about costs and tow fees
Summary
The committee forwarded a resolution to lease 12.72 acres at 2650 Bayshore Boulevard for SFMTA towing and transit operations and adopted a budget analyst technical amendment; staff described net present value scenarios and site constraints, and supervisors pressed SFMTA on high tow fees and cost recovery under Prop 218.
The Budget and Finance Committee heard an extended presentation from SFMTA staff on a proposed long-term lease for approximately 12.72 acres and 255,420 rentable sq ft at 2650 Bayshore Boulevard (a site just over the San Francisco–Daly City border) to house towing operations, vehicle storage and other transit-related functions.
Director Ed Rieskin (recorded in the transcript also as Wyskin) told the committee the SFMTA must leave Pier 70 and that market supply of suitable industrial properties in San Francisco and adjacent areas is extremely limited. He said the agency has no viable “Plan B,” that prices are rising, and that the proposed lease would allow a three-month overlap between old and new leases. He emphasized stewardship of agency funds and said staff did not bring the request lightly.
SFMTA described how the lease fits into a real estate master plan intended to accommodate projected fleet growth (roughly 20% over 20–30 years). Kirsten McGarry, senior manager of real estate, outlined site-selection criteria (roughly 13 acres for towing operations, M1/M2 zoning, proximity to transit, and existing structures of ~200,000 sq ft to avoid costly remediation) and reviewed alternatives that were impractical (including privately held parcels, sites requiring hazardous remediation, flood-zone parcels, and port-owned properties that have complex state approvals).
McGarry presented net present value scenarios for the lease: including building expenses, a 10-year NPV of roughly $21 million and a 20-year NPV of roughly $38 million; excluding building expenses lowered the NPVs (10-year ~$17.8M; 20-year ~$33M); a scenario that also excluded certain lease offsets produced significantly lower NPVs (10-year ~$2.9M; 20-year ~$6.2M). Staff promised a corrected NPV figure page for committee members.
Supervisors questioned the makeup of tow-related fees. The transcript lists a contractor towing fee (~$200–$210), a contractor storage fee ($63 per day), and an MTA administrative fee (~$243). Director Rieskin said Prop 218 governs cost recovery for the fees and that the agency believes it is recovering costs; he said SFMTA would look for efficiencies when bidding contracts and during the move but had not identified specific mechanisms to reduce the fees.
Public comment on the Bayshore item was closed with no speakers. Supervisor Kim moved to forward the lease item to the Board without recommendation and indicated she planned to support it at the full board; the committee also adopted the budget analyst’s technical amendment to correct figures and sent the item forward without objection.
Next steps: The lease resolution and the adopted technical amendment will proceed to the Board of Supervisors. SFMTA said it will continue pursuing efficiencies and refine the master plan, and staff will provide corrected NPV materials to supervisors.
