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Home My WebLink About04.a. Review draft Position Paper to consider adopting new Board Policy No. BP 043 - Buffer Property Management, effective May 1, 2021 Page 1 of 5 Item 4.a. Algi CENTRAL SAN BOARD OF DIRECTORS POSITION PAPER DRAFT MEETING DATE: MARCH 9, 2021 SUBJECT: REVIEW DRAFT POSITION PAPER TO CONSIDER ADOPTING NEW BOARD POLICY NO. BP 043 - BUFFER PROPERTY MANAGEMENT, EFFECTIVE MAY 1, 2021 SUBMITTED BY: INITIATING DEPARTMENT: DANEA GEMMELL, PLANNING AND ENG-PDS-DIVISION MANAGER DEVELOPMENT SERVICES DIVISION MANAGER REVIEWED BY: JEAN-MARC PETIT, DIRECTOR OF ENGINEERING AND TECHNICAL SERVICES ISSUE Board of Directors (Board) approval is required for adoption of new Board Policies. BACKGROUND Over the years, Central San has obtained buffer properties surrounding the treatment plant in order to reduce any disturbances to nearby neighbors due to noise, odors, and land use. Some of these properties have been leased out to tenants with compatible uses in compliance with Health and Safety Code §6514.1 (see Attachment 1), which provides a procedure to lease public lands that are unneeded for a period up to ten years. It would benefit Central San to adopt a policy on buffer properties to provide guidance to staff in evaluating prospective and existing tenants. Criteria for consideration are proposed that prioritize Central San's needs for its own use to operate and maintain the sanitary sewer system and wastewater treatment and disposal facilities of the District. Secondarily, buffer properties provide additional lease revenue that help keep sewer service charges lower for ratepayers. Finally, tenants that can provide a public benefit for either the short term or long term, should be considered. Development of this criteria provides a transparent metric for all tenants requesting use of Central San's buffer properties. On January 21, 2021, staff presented an overview of District properties, including buffer properties (located between the treatment plant and the surrounding properties not owned by Central San). The Board directed staff to draft a new policy on buffer property management and present to the Administration Committee for consideration. March 9, 2021 Regular ADMIN Committee Meeting Agenda Packet- Page 4 of 44 Page 2 of 5 Attached for the Board' s consideration is a proposed new Board Policy No. B P 043 - Buffer Property Management. ALT ERNAT IVES/CONSIDERAT IONS The Board may choose not to adopt the proposed policy or may provide other direction to staff. FINANCIAL IMPACTS For Fiscal Year 2020-21, Central San anticipates approximately$719,000 in lease rental revenue. This annual revenue is projected to escalate by approximately three percent per year. COMMITTEE RECOMMENDATION The Administration Committee reviewed this matter at its March 9, 2021 meeting and recommended RECOMMENDED BOARD ACTION Adopt new Board Policy No. BP 043 - Buffer Property Management, effective May 1, 2021. Strategic Plan Tie-In GOAL THREE:Fiscal Responsibility Strategy 1—Maintain financial stability and sustainability, Strategy 2—Ensure integrity and transparency in financial management ATTACHMENTS: 1. Health and Safety Code Section 6514.1 2. Proposed BP 043 - Buffer Property Management March 9, 2021 Regular ADMIN Committee Meeting Agenda Packet- Page 5 of 44 Page 3 of 5 II STATE OF CALIFORNIA LEGISLATIVE AUTHENTICATED COUNSEL BuaEAU ELECTRONIC LEGAL MATERIAL Attachment 1 State of California HEALTH AND SAFETY CODE Section 6514.1 6514.1. (a) A district may lease, for a term not exceeding 99 years, subject to periodic review, district property that will not be needed for district purposes during the term of the lease,as a means of providing revenues to the district for the operation and maintenance of sanitary sewer system and waste water treatment and disposal facilities of the district,and to finance the acquisition,construction,and improvement of these facilities. (b) Prior to entering into a lease, the board shall, except as otherwise provided in subdivision (e),publish notice pursuant to Section 6066 of the Government Code of the time and place of the meeting of the board at which the proposed lease will be considered, and at that time and place shall afford all persons present an opportunity to be heard with respect to the proposed lease. (c) If the board finds that the subject property will not be needed by the district and that it is in the best interests of the district and the users of its sanitary sewer system that the lease be entered into, it may, by ordinance setting forth the findings, authorize the lease. The ordinance shall be subject to Article 2 (commencing with Section 9340) of Chapter 4 of Division 9 of the Elections Code. (d) Every lease shall be awarded to the bidder which, in the determination of the legislative body, offers the greatest economic return to the district after competitive bidding conducted in the manner determined by the legislative body. Notice inviting bids may be published pursuant to Section 6066,in one or more newspapers of general circulation within the district. (e) If the board makes a finding at a noticed public hearing that the subject property will be used for compatible uses,that it will be of public benefit, and that the term of the lease will not exceed 10 years, subdivisions (c) and (d) shall be optional. (Amended by Stats. 1994,Ch. 923,Sec. 122. Effective January 1, 1995.) March 9, 2021 Regular ADMIN Committee Meeting Agenda Packet- Page 6 of 44 Page 4 of 5 Attachment 2 Number: BP 043 Authority: Board of Directors Effective: May 1, 2021 Revised: N/A ZN- Reviewed: N/A Initiating Dept./Div.: Engineering/Planning & Dev. CENTRALSAN BOARD POLICY BUFFER PROPERTY MANAGEMENT PURPOSE To provide guidance for management of Central San's buffer properties. This policy is for buffer properties that are located between the treatment plant and the surrounding properties not owned by Central San. Leasing criteria and prioritization will be utilized for any unneeded buffer property that is proposed for lease to others. POLICY It is Central San's policy to obtain and manage buffer property around the treatment plant to avoid incompatible land uses and minimize disturbances to the community. In applying this policy, Central San shall review, every ten years at a minimum, its buffer properties to determine the need and use thereof. Central San will maintain a priority for its own use to operate and maintain the sanitary sewer system and wastewater treatment and disposal facilities. Central San will then prioritize prospective projects interested in leasing a buffer property that enhances Central San's vision, mission, and purpose over those projects that do not relate to wastewater. LEASING CRITERIA For leasing the unneeded real property, Central San will comply with Health and Safety Code §6514.1. The following factors will be taken into consideration when evaluating new lease proposals for buffer properties. 1. Land use must be compatible with Central San's land use. (All leases shall include clauses allowing Central San to request termination, if the Board declares property is needed for public use.) 2. Adherence to all applicable laws, rules, and regulations. 3. Market lease rates or a comparable public benefit shall be charged to provide additional revenue to Central San and its ratepayers. 4. Other Public Agencies needs shall be given priority for temporary uses over private entities. 5. Public acceptability and aesthetics. March 9, 2021 Regular ADMIN Committee Meeting Agenda Packet- Page 7 of 44 Page 5 of 5 Number: BP 043 BUFFER PROPERTY MANAGEMENT Page 2 of 2 6. Avoid potential for adverse environmental impacts, such as hazardous material spills. 7. Financial stability to pay rent timely and address needed environmental cleanup. 8. Housekeeping performance of existing tenants. [Original retained by the Secretary of the District] March 9, 2021 Regular ADMIN Committee Meeting Agenda Packet- Page 8 of 44