
COUNTY OF SAN MATEO Inter-Departmental Correspondence
COUNTY MANAGER’S OFFICE

DATE:		June 15, 2005
BOARD MEETING DATE:		June 21, 2005
SPECIAL NOTICE/HEARING:		None
VOTE REQUIRED:		Majority

TO:	Honorable Board of Supervisors
FROM:	Mary McMillan, Deputy County Manager
SUBJECT:	City of South San Francisco Redevelopment Funds for County improvements

RECOMMENDATION:

Adopt a Resolution making findings regarding public improvements in the City of South San Francisco and authorizing the execution of an agreement with the City of South San Francisco and the Redevelopment Agency of South San Francisco for payment of up to $5,000,000 in assistance for County projects.

VISION ALIGNMENT:
Commitment: Responsive, effective and collaborative government
Goal 20: Government decisions are based on careful consideration of future impact, rather than temporary relief or immediate gain.

BACKGROUND:
The Redevelopment Agency of the City of South San Francisco is considering a proposal to fiscally merge its four project areas into one; and to enlarge the project area to include the 97-acre Oyster Point Marina. Existing "pass-through" agreements between the City and the County provide the County with 26 percent of the tax increment from the U.S. Steel/Shearwater project area; 80 percent of the tax increment from the El Camino Corridor project area; and 25.65 percent of the tax increment from the Downtown/Central project area. These existing agreement would not be changed by the proposed merger. The proposed merger would extend the terms of two project areas, which would result in an estimated loss over 25 years of between $20 and $40 million to the County General Fund; and an estimated $9 and $11 million loss of revenue to the Colma Creek Flood Control Zones of San Mateo County Flood Control District (District).

The Gateway Project area will reach its current cap of $80,000,000 in FY 2009/10. The proposal amendments would extend its term to FY 2029 and result in an estimated loss of $36 million to the County.

DISCUSSION:

The County objected to the proposal so to mitigate any adverse impact on the County, the City and its Redevelopment Agency have agreed to modify the proposal and reduce the term of the Gateway Project area; and have agreed to enter into an agreement with the County wherein the Redevelopment Agency would contribute up to $5 million to help fund County projects within the City in order to mitigate adverse impacts of the proposal. The mitigation funds can be used for mutually agreed upon projects, including improvements to the Safe Harbor Homeless Shelter, rent and facility improvement cost waivers for the County Clinic located in South San Francisco, reimbursement to the County for the costs associated with the improvements to the Westborough Boulevard guard rail, and construction and installation of access and other improvements, including a Habitat Conservation Plan Amendment ,as necessary in those areas of the San Bruno Mountain Habitat adjacent to the Agency project areas. The proposed Settlement and Release Agreement implements this mitigation plan. The City and the Agency have passed resolutions approving the Agreement.


With regard to the impacts on the San Mateo County Flood Control District, staff of County Public Works, representing the District, met with representatives of the South San Francisco Redevelopment Agency to discuss the impacts of the property tax loss on proposed flood control projects in the Colma Creek Zones. The District is concerned that it will be unable to meet its maintenance obligations for additional capital improvements in Colma Creek due to the loss of property tax revenue resulting from the redevelopment amendment as proposed. The cost of meeting regulatory requirements associated with maintaining channel improvements is becoming more expensive - due in part to presence of endangered species in Colma Creek and its environs, and the costs associated with maintaining both riparian and tidal habitats that exist in the lower reaches of Colma Creek. The District informed the Agency that as a result of the current and proposed ongoing loss of property tax revenue resulting from the Agency’s proposals and actions, no additional projects would be undertaken in the Colma Creek Zone until such time as an equitable solution has been reached. An alternative for consideration is the Agency or the City of South San Francisco themselves implementing and maintaining the Colma Creek Zone improvements.

Staff will present its findings to your Board after their evaluation has been completed and reviewed by the Colma Creek Advisory Committee.

FISCAL IMPACT:
The payment by the City/Agency of the agreed upon $5 million will not impact the County’s fiscal situation, but will allow the value of the improvements to made on County property and or programs.