Inter-Departmental Correspondence

County Manager’s Office



December 10, 2008


December 16, 2008







Honorable Board of Supervisors


David Boesch, Assistant County Manager


Transfer of Trial Court Facilities to the State



Adopt a resolution authorizing the County Manager, or his designee, to execute transfer agreements, a joint occupancy agreement and other documents between the County and the Judicial Council of California, Administrative Office of the Courts (AOC) for the transfer of responsibility for court-related portions of the Hall of Justice and the transfer of responsibility and transfer of title for the Traffic/Small Claims Annex.



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.


The transfer of court facilities to the State contributes to this commitment and goal by further defining the respective operational and financial roles and responsibilities of the County and the State with regard to trial court facilities.



The Lockyer-Isenberg Trial Court Funding Act of 1997 (AB 233) transferred the primary obligation for funding court operations from the counties to the State, ending a dual system of county and state funding. The Trial Court Facilities Act of 2002 (SB 1732) was adopted to provide for the transfer of responsibility for funding and operation of trial court facilities from counties to the State. Some of the guiding principles for the transition contained in SB 1732 include:

    The transfers shall occur as expeditiously as possible and be completed by June 30, 2007;

    The transfers shall be negotiated on a building-by-building basis between the State and the counties with negotiated agreements governing each facility;

    Counties shall provide in-lieu funding for future facilities operation and maintenance costs based on historic funding patterns through a county facilities payment (CFP) to the State; and

    Counties can retain title to certain facilities under certain circumstances, including the historic nature of the facility.


Because only a few buildings statewide had transferred through the negotiation process outlined in SB 1732 by June 30, 2007, the Court Facility Re-Authorization Bill (AB 1491) was signed into law in April 2008. This bill extended the court facility transfer deadline to December 31, 2009 and established deadlines with tiered inflationary adjustments intended to encourage expeditious transfers. On September 16, 2008, the Board approved a tolling declaration with the AOC extending the deadline for the first adjustment by three months to December 31, 2008, effectively providing that for facility transfers executed by both parties by December 31, 2008, no adjustment would be applied. Accordingly, for any transfer agreement executed between January 1, 2009 and on or before March 31, 2009, there is a "Tier 1" penalty of 2.4%. For any transfer agreement executed between April 1, 2009 and on or before December 31, 2009, there is a "Tier 2" penalty factor of 4.95%. The penalties are applied to the final CFP amount, but are not cumulative.


Staff has been working diligently with the AOC to ensure that mutually acceptable transfer agreements can be executed in a reasonably timely manner. Minimizing any penalties is of particular importance as once a transfer occurs the CFP, without further adjustments, will be paid in perpetuity. The CFP is a fixed amount for each facility, based on the County’s cost of maintaining and operating that facility for the five year period FY 1995-96 to FY 1999-00, adjusted for inflation. The components include operations and maintenance, utilities, and insurance.


The County has six court facilities that that will ultimately transfer to the AOC, in one form or another, as follows: i) the Hall of Justice (52.7% Court occupied) in Redwood City; ii) the Traffic/Small Clams Annex (100% Court occupied) in Redwood City; iii) the Central Branch (100% Court occupied) in San Mateo; iv) the Youth Services Center (7.93% Court occupied) in San Mateo; (v) the Northern Branch (79.88% Court occupied) in South San Francisco; and (vi) the Jail Annex (29.28% Court occupied), commonly known as Courtroom “O”, in South San Francisco.

The first two facilities to transfer, pursuant to the attached agreements, are the Hall of Justice and the Traffic/Small Claims Annex.



The transfer agreements for each facility are designated to address the type of transfer. Based on square footage calculations provided by the AOC and confirmed by the County, the County occupies 47.3% of the Hall of Justice and the Court occupies 52.7%. County Administration recommends a transfer of responsibility (TOR) with a joint occupancy agreement (JOA) for the Hall of Justice. The County will retain title of the building and will be the managing party, meaning that the County will be responsible for maintaining building-wide systems, but the cost will be prorated based on the entities’ share of the building. The Court will be responsible for maintaining its court-exclusive areas at no cost to the County. The Court will also share in the building’s utility costs, again based on its share of the building. The CFP for the Hall of Justice has been calculated to be $1,054,477. It has been reviewed and approved by the AOC but still requires approval by the Department of Finance (DOF). The final fixed CFP will be adjusted one last time to factor in the inflationary adjustment from December 31, 2008 to the actual date that the Court assumes responsibility for maintaining its portion of the building. This date has been tentatively set as March 1, 2009.


The Court is the sole tenant of the Traffic/Small Claims Annex (Annex). Based on the provisions set forth in SB 1732, County Administration concurs with a transfer of title for the Annex. The Court will be solely responsible for the maintenance and utilities of the building. The CFP for the Annex has been calculated to be $73,698. Like the Hall of Justice CFP, it has not yet been reviewed and approved by the DOF and it will also be adjusted upward one last time based on the final transition date. In keeping with the County’s long-range plan to build a third County office building on the parcel of land that includes the Annex, the AOC and the local Court have agreed to a recital in the agreement that acknowledges the County’s intent to build a new office building on the site and states their intentions to reasonably cooperate with the County in its efforts to develop the new building.


The County will continue to maintain parking at the Redwood City campus at the County’s expense, including the parking structure, the juror lot and smaller lots located around the campus and behind the Law Library. As such, no parking costs are included in either CFP.


Public Works has kept a number of Stationary Engineer positions vacant in anticipation of this shift in workload as the Court assumes responsibility for maintaining its areas. Staff currently providing services to the court-exclusive areas will be reassigned. No layoffs will occur as a result of these transfers.



The two CFPs will create a new maintenance of effort provision for the County that will require annual transfers to the State of $1,128,175, pending one more inflationary adjustment. The County Support of the Courts budget unit currently pays approximately $1.8 million in annual rent for these two facilities to Public Works. Once the transfers take effect, the Court will assume responsibility for maintaining its share of these facilities. We anticipate that some portion of the difference between the CFP amounts and the annual rent paid to Public Works may be needed to provide rent stabilization to other County tenants in the Hall of Justice. Though further analysis is required, no additional Net County Cost is anticipated.


The County’s best efforts fell short in transferring the four remaining facilities by December 31, 2008. Those transfer agreements will be brought to the Board during the first quarter of 2009. As a result, the CFPs for those facilities will be adjusted by the 2.4% Tier 1 penalty.