2024-12-17 Special CC Minutes MINUTES OF THE SPECIAL CITY COUNCIL MEETING
TUESDAY- -DECEMBER 17, 2024- -6:15 P.M.
Mayor Ezzy Ashcraft convened the meeting at 6:20 p.m. Councilmember Jensen led the
Pledge of Allegiance.
ROLL CALL - Present: Councilmembers Daysog, Herrera Spencer, Jensen, Vella,
and Mayor Ezzy Ashcraft— 5.
Absent: None.
CONSENT CALENDAR
The City Clerk announced the resolution approving a final map [paragraph no. 24-693] was
withdrawn by staff and would return at a later date.
Mayor Ezzy Ashcraft requested the agreement with Lincoln Property Company [paragraph no.
24-682] be withdrawn from the Consent Calendar for discussion.
Expressed concern about the election, Tidelands Trust funds and California Environmental
Quality Act findings: Tod Hickman.
Expressed concern about the building demolition: Shelby Sheehan.
Councilmember Herrera Spencer recorded a no vote on the declaration of unsafe building at
2450 Saratoga Street [paragraph no. 24-684], amendment to the agreement with ELS
[paragraph no. 24-687], and the resolution approving the Fire Memorandums of Understanding
[paragraph no. 24-696].
Councilmember Vella moved approval of the Consent Calendar.
Councilmember Jensen seconded the motion, which carried by unanimous voice vote - 5. [Items
so enacted or adopted are indicated by an asterisk preceding the paragraph number.]
(*24-677) Minutes of the Special City Council Meeting, the Joint City Council and Successor
Agency to the Community Improvement Commission Meeting and the Regular City Council
Meeting. Approved.
(*24-678) Ratified bills in the amount of$4,159,199.46
(*24-679) Recommendation to Accept the Police and Fire Construction Impact Fee Annual
Report. Accepted.
(*24-680) Recommendation to Accept the 2013 Local Library Bond Measure Annual Report.
Accepted.
(*24-681) Recommendation to Accept and File Various Community Facilities Districts (CFD)
Reports for Fiscal Year (FY) Ending June 30, 2024, including: CFD No. 03-1 (Bayport Municipal
Services District); CFD No. 13-1 (Alameda Landing Public Improvements); CFD No. 13-2
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(Alameda Landing Municipal Services District); CFD District No. 14-1 (Marina Cove II); CFD No.
17-1 (Alameda Point Public Services District); and CFD No. 22-1 (Alameda Marina). Accepted.
(24-682) Recommendation to Authorize the City Manager to Execute an Agreement with Lincoln
Property Company for Management of the City's Real-Property Asset Portfolio, Including City-
Owned or Controlled Commercial and Residential Property at Alameda Point and Other Select
Locations Throughout Alameda for an Initial Term of Two Years for a Total Not-to-Exceed Cost
of $3,462,138 Plus Commission, with Two Options for Two-Year Renewals for a Total Possible
Duration of Six Years And a Total Not-to-Exceed Amount of$11,436,037 Plus Commission.
Mayor Ezzy Ashcraft stated that she cannot support the item as it is currently constituted with
paying over $11 million over a six year period for a property management company, which is
about $1.8 million per year; the indemnification agreement is basically handing indemnification
back to the City; she is concerned the property management company wants to be limited to
liability to the maximum of available insurance proceeds or the maximum insurance proceeds
that would have been available; making the City kicks in and provides the coverage; the City
should not just kick in and provide the remainder of the coverage for negligent acts caused or
allowed to happen by the property management company; the City is also supposed to provide
primary defense in court; there are too many unknowns, including what it could cost the City; the
most she could approve is a six-month contract to allow the City to go back out to bid; the
agreement is too financially risky for the City.
The Base Reuse and Economic Development Director gave a brief presentation.
In response to Councimember Jensen's inquiry, the City Attorney stated that he has shared
communications from the City's insurer with the Council outlining general concerns and not
wanting to take on the liability; the City's insurer has not committed to insure the City in the
excess layer; the skepticism could be viewed as concern that the dollars may ultimately impact
the agency.
Councimember Jensen inquired how it would play out for the City if the limited liability
agreement with the property management company is approved and there is an act of
negligence, violence, or any intentional act that is the subject of a lawsuit for$10 million dollars.
The City Attorney responded there is going to be a difference between intentional and reckless
acts versus negligent acts; Lincoln Propety Company (LPC) is taking liability for intentional and
reckless acts; however, liability is limited to LPC's insurance maximum, which is somewhere
between $1 to 2 million; anything above that, such as $10 million, $8 to 9 million would be the
responsibility of the City and, potentially, California Joint Powers Risk Management Authority
(CJPRMA).
Councimember Jensen inquired if CJPRMA agrees to provide the insurance and the City has to
pay $8 million for an act that is not in any way the fault of the City, what would likely be the
outcome, to which the City Attorney responded the City's insurance premiums would likely
increase.
In response to Councimember Jensen's inquiry regarding what the property management
company does, the Base Reuse and Economic Development Director stated LPC is the current
property manager for all City owned real property not being used as a City facility; LPC
administers all property management functions, such as calculating and collecting rent,
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providing monthly financial reports, handling all tenant communications, managing the City's
licensing program, initiating repairs and maintenance at the City's direction, collecting estimates
with the City authorizing and executing the contracts; LPC also manages private security and
landscaping and minor repairs at the former Base.
In response to Mayor Ezzy Ashcraft's inquiry regarding landscaping services, the Base Reuse
and Economic Development Director stated there are separate contracts for all services.
The City Manager stated given the terms that are being negotiated, the City does not take the
contract lightly; Alameda Point is a large asset that is very complex and very different than most
public land holdings in the State and privately managed properties, such as a shopping center,
mall, or office building; Alameda Point does not fit the box of a typical property management
scenario; the City has identified and corroborated with other private property managers; when
companies like LPC act as an agent of a property owner, it calls on the owner's insurance first
because it is acting as the agent; the model is not the model for how the City manages property;
Alameda Point is a very different asset than any other public land owned by a city; very few
other cities have the scale of complexity of Alameda Point, which does not fall in the typical box
of the City's insurance way to do a contract; the City is stuck in the middle, trying to negotiate
with two parties that are being forced to look at a contract that does not fit in typical ways of
doing business; staff has been trying to negotiate with both parties to try to limit the City's
liability; the deal is the best that the City can get, including covering gross negligence and willful
misconduct, which is really important; not having a property manager for Alameda Point is of
greater risk to the City than moving forward with the contract; there are financial contingencies
in the Base Reuse fund in the event there are lawsuits or other issues to try to insulate the
General Fund from any impacts; the City is getting squeezed by two parties that are not quite
sure what to do with Alameda Point.
Councimember Jensen stated that she appreciates the work of the Base Reuse and Economic
Development Director and staff, as well as the uniqueness of the asset; to the extent that it is
unique, there is no model; the City is a public agency, she tends to agree with Mayor Ezzy
Ashcraft's point that perhaps the work should be done in house; the City has to react to issues
that come up through the property manager; it has become very apparent that the City will be
taking on substantial liability if the contract is approved.
Councilmember Herrera Spencer stated the hypothetical amount of $10 million is significantly
low; she appreciates the scenario, however, as a City, there is significantly more exposure; she
agrees with the concerns that have been raised; inquired what is so unique about the Base that
makes it not fit into any box.
The City Manager responded Alameda Point has large spaces and numerous buildings are
vacant; most of the buildings that are leased have insurance from the tenants; the large vacant
buildings are difficult to secure and manage; securing the buildings would also be costly; she is
fine with exploring the idea of bringing the services in-house; she cautions it will take time to
create job descriptions and figure out how to phase it in the budget; the recommendation would
be to enter into the contract; then, staff could come back with an update in several months with
a plan for how the service might be brought it in-house and get further direction at that point.
Councilmember Herrera Spencer inquired whether the large vacant buildings will be sold, have
tenants, or be left indefinitely; to which the City Manager responded staff would follow the
disposition strategy the Council has given direction on.
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Councilmember Herrera Spencer stated that she thinks the City should move forward with trying
to sell as much as possible at Alameda Point; $1.9 million is actually a very small part of what
the City's real costs are of managing Alameda Point properties.
The Base Reuse and Economic Development Director stated the City has a separate residential
property management contract with Cerda-Zein, which is smaller scale than the commercial
side.
In response to Councilmember Herrera Spencer's inquiry, the Base Reuse and Economic
Development Director stated the City's brokers, Cushman and Wakefield, get a 5% commission
on sales and leases.
The City Manager stated the City generates between $15 to $17 million annually in revenue
from the Base with about two million square feet of commercial space; it is a significant land
holding that generates significant revenue annually.
Councilmember Herrera Spencer stated the City needs to move forward with trying to sell or
occupy the buildings to reduce the cost.
The City Attorney advised Councilmember Herrera Spencer to limit the conversation to the
issue; direction on whether to sell or lease property may be outside of the agenda.
Stated that he agrees with the Mayor; expressed support for getting rid of River Rock and
concern about the Tidelands Trust: Tod Hickman.
Mayor Ezzy Ashcraft left the meeting at 6:50 p.m. and returned at 6:52 p.m.
***
Councilmember Herrera Spencer inquired whether the City is confident that the source of funds
is separate from any Thailand's trust money.
The City Manager responded the City is confident about the source of funds; stated the
revenues from buildings within the Thailand Trust are put into a separate account.
In response to Councilmember Herrera Spencer's inquiry as to what happens if the contract is
not approved tonight, the City Manager stated if the direction is to enter into a contract and
come back with a plan for trying to bring services in house within 3 months, staff could have a
conversation and spend time creating a plan; she would need to consult with the Human
Resources department regarding job descriptions and the timeline; the preferred direction would
be to come back and terminating the contract without a timeline; direction on how quickly it
could be brought in-house would be the ideal recommendation.
Councilmember Herrera Spencer stated even a six-month contract would still have exposure for
the City.
The City Manager stated the City would have more exposure if the contract is not entered into;
the City cannot manage the Base and would have no one to manage it; all RFPS would stop,
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including for housing; staff would have to work on all real estate transactions, in which case the
City would have an even greater liability.
Councilmember Herrera Spencer requested a legal opinion regarding the liability, to which the
City Attorney responded from an insurance perspective, everything done internally will be
covered by CJPRMA; stated there is a significant self-insurance deductible, which is between
$750,000 and $1 million; anything in excess will be insured by CJPRMA.
The Base Reuse and Economic Development Director stated Lincoln Property Company
currently has five full-time staff, plus two part-time staff, to do the property management for the
City; it is a very extensive job; current City staff could not do the job.
Vice Mayor Vella stated it is clear that more thought needs to go into the long term; an overview
and a visit to the Base and prioritization over next steps for Alameda Point could come back
when the new Council reconvenes at some point; in the short term and hearing the City
Manager about the need for something to happen, she is happy to support something on the
shorter side.
Mayor Ezzy Ashcraft stated more time is better than less; there has been great improvement in
the insurance indemnification agreement just since the staff report was published, because the
City Attorney and staff all kept working; if the agreement gets to a reasonable point that does
not put so much burden on the City, she would accept it; she would like to see a two-pronged
approach with a six-month contract to give the City the time to keep negotiating, but also be
preparing an RFP to see if the City can get another firm and also looking at the steps needed to
bring the process in-house; she cannot agree to a two-year contract at this point in time.
Vice Mayor Daysog stated that he believes the City is better served by having a private entity
assist the City in managing the commercial and some of the residential properties at Alameda
Point; private companies are a lot more nimble and have experience dealing with tenants;
however, Alameda has to guard against having the liability hoisted on the City; he wonders
whether there are other entities that might not have the same practice as LPC.
In response to Vice Mayor Daysog's inquiry regarding Clear Blue Commercial, the Base Reuse
and Economic Development Director stated the issue was not addressed with Clear Blue
Commercial; research showed it is standard for the landowner to accept primary responsibility
for simple negligence; staff is open to finding more information regarding gross negligence and
willful misconduct.
Vice Mayor Daysog stated that he shares the concerns raised by the City Manager regarding
managing the property; the City does not have the same capacity as the private sector; the
wiser course of action is to punt for a six to eight month period, figure out if there is an interim
approach, and, if necessary, come back to LPC with a long term contract after research is done;
maybe the City can devise some kind of instrument to self-insure even more than what is being
paid to guard against situations where someone might be asking for $15 to $20 million.
The City Manager stated if the direction is going to be six months, staff wants to be able to
disclose the total contract amount; the contract is $3.5 million for 2 years, so a six-month
contract would be $875,000; she would ask for some wiggle room for a total amount not to
exceed $1.2 million just in case there is a big repair or something else happens.
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Mayor Ezzy Ashcraft stated if the City is going to pay that amount of money, there has to be a
balance; she has faith in staff to keep hammering these folks or the City will find another
property management company; eventually the Council would like to take the service in-house;
noted there is a new Council coming.
Vice Mayor Daysog moved approval of a contract for a period of six months in an amount not to
exceed $1.2 million, and during that time period staff would continue to negotiate an
indemnification agreement, possibly preparing an RFP for another property management
company, and ultimately looking at the steps to take the process in-house.
Councilmember Herrera Spencer seconded the motion.
Under discussion, the City Attorney addressed the form of contract.
On the call for the question, the motion carried by unanimous voice vote - 5.
(*24-683) Recommendation to Authorize the City Manager to Execute a One-Year Agreement
with Bay Ship & Yacht Company in an Amount Not-to-Exceed $110,600, with the Option of Two
One-Year Extensions, for a Total Three-Year Expenditure Not-to-Exceed $303,800, for Port
Management Services for Piers1 through 3 at Alameda Point. Accepted.
(24-684) Recommendation to Authorize the Continued Action to Address Declaration of Unsafe
Building and Notice to Vacate, Case Number X24-0470, for the City-Owned Building Located at
2450 Saratoga Street, Alameda, California.
Note: Since Councilmember Herrera Spencer recorded a no vote, the item carried by the
following vote: Ayes: Councilmembers Daysog, Jensen, Vella and Mayor Ezzy Ashcraft — 4.
Noes: Councilmember Herrera Spencer— 1.
(*24-685) Recommendation to Authorize the City Manager to Accept the Work of Ranger
Pipelines, Inc. for Cyclic Sewer Replacement Project, Phase 19, No. PW 02-22-18. Accepted.
(*24-686) Recommendation to Authorize the General Manager to Execute the Transmission
Owner Rate Case Program Agreement between The Northern California Power Agency and
Alameda Municipal Power. Accepted.
(24-687) Recommendation to Authorize the City Manager to Execute an Amendment to an
Agreement with ELS Architects, Inc. in an Amount Not-to-Exceed $1,009,434, for City Aquatic
Center Preliminary/Conceptual Design Services, Including Design Development, through July 1,
2025, for a Total Compensation Amount Not-to-Exceed $1,513,121.50.
Note: Since Councilmember Herrera Spencer recorded a no vote, the item carried by the
following vote: Ayes: Councilmembers Daysog, Jensen, Vella and Mayor Ezzy Ashcraft — 4.
Noes: Councilmember Herrera Spencer— 1.
(*24-688) Recommendation to Authorize the City Manager to Execute an Agreement with ELock
Technologies LLC for Electronic, Shared-Use Public Bicycle Locker Maintenance and Services
for Five Years for a Total Amount Not-to-Exceed $90,000. Accepted.
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(*24-689) Recommendation to Authorize the City Manager to Execute a Two-Year Agreement
with RRM Design Group to Prepare a City Facilities Plan in an Amount Not-to-Exceed
$497,462. Accepted; and
(*24-689A) Resolution No. 16229, "Amending the Fiscal Year 2024-25 Operating Budget
Appropriating $500,000 of Earned Interest from Project C99300 to the Fiscal Year 2024-25 Non-
Departmental Operating Budget." Adopted.
(*24-690) Recommendation to Authorize the City Manager to Execute and Modify All
Documents Deemed Necessary and Appropriate to Submit an Application to Round 3, and
Future Rounds, of the Prohousing Incentive Program to the California Department of Housing
and Community Development. Accepted; and
(*24-690A) Resolution No. 16230, "Authorizing the City Manager to Apply for, Accept, and
Appropriate Prohousing Incentive Program Grant Funds for the Day Center Relocation Project
and the Linnet Corner Supportive Services." Adopted; and
(*24-690B) Recommendation to Authorize the City Manager to Provide Funding from the
Prohousing Incentive Program to the Alameda Housing Authority (AHA) in an Amount Not-to-
Exceed $250,000 for the Provision of Supportive Services in the Linnet Corner Permanent
Supportive Housing. Accepted.
(*24-691) Resolution No. 16231, "Declaring Canvass of Returns and Results of the
Consolidated General Municipal Election Held on Tuesday, November 5, 2024." Adopted.
(*24-692) Resolution No. 16232, "Approving the Records Retention Schedule." Adopted.
(24-693) Adoption of Resolution Approving a Final Map and Accepting the Dedications and
Easements for Tract 8696, West Midway Large Lot. Not heard.
(*24-694) Resolution No. 16233, "Amending the Fiscal Year 2024-25 American Rescue Plan Act
Fund (Fund 223) Operating Budget Appropriating $87,113 from Available Earned Interest to
Project C99300 (American Rescue Plan 2021) Guaranteed Basic Income Pilot Program and
Reducing the Appropriation of ARPA Funds by $87,113." Adopted.
(*24-695) Resolution No. 16234, "Receiving and Filing the Fiscal Year 2023-24 Development
Impact Fee (DIF) Report and Five-Year Report, Containing Both Development Impact Fees and
Fees Otherwise Subject to Development Agreements, and Making Certain Findings as Required
by Government Code Sections 66000 et seq." Adopted.
(24-696) Resolution No. 16235, "Approving Workforce Changes and Amendments to the
Memorandums of Understanding between the City of Alameda and the Alameda Fire Chiefs
Association and the City of Alameda and the International Association of Firefighters, Local 689
in Support of the Fire Department Reorganization." Adopted.
Note: Since Councilmember Herrera Spencer recorded a no vote, the item carried by the
following vote: Ayes: Councilmembers Daysog, Jensen, Vella and Mayor Ezzy Ashcraft — 4.
Noes: Councilmember Herrera Spencer— 1.
(*24-697) Resolution No. 16236, "Amending Fiscal Year 2024-25 General Fund (Fund 100) and
Golf Fund (Fund 250) Operating Budgets Appropriating $800,000 from General Fund Residual
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Fund Balance to Golf Fund for Expenses for Ongoing Litigation Against Greenway Golf
Associates, Inc." Adopted.
ADJOURNMENT
There being no further business, Mayor Ezzy Ashcraft adjourned the meeting at 7:06 p.m.
Respectfully submitted,
Lara Weisiger
City Clerk
The agenda for this meeting was posted in accordance with the Sunshine Ordinance.
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