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City Manager's Weekly Report For Week Ending August 4, 2006
Mayor and Councilmembers:

This is the weekly report for the week ending August 4th, 2006.

1.      Meeting Notes

There are no City Council meetings scheduled until Tuesday, September 12, 2006.  As a reminder, there will be a public meeting on Tuesday, August 15th in the Bermuda Room of the Richmond Auditorium from 6:00 PM to 9:00 PM to review and hear comments concerning the Civic Center Master Plan.

2.      Results of Civic Center Lease Rate Arbitration

As you may recall, the City exercised its option to renew the lease at 1401 Marina Way South for a five year term, with an option to terminate after three years.  The option provided that the lease rate would be determined, and would be set at 95% of “fair market rent.”  Staff could not come to an agreement with the Landlord as to the fair market rent, and the matter was submitted to arbitration in accordance with the lease provisions.  The type of arbitration, known as “baseball” arbitration, does not seek to compromise opposing positions, but, instead, determines which party is closer to actual fair market rent, and sets the fair market rent for the lease at the rate submitted by the prevailing party.  We were advised earlier this week that the City prevailed in the arbitration, and that the rent for the building, starting September 15, 2006, will be set at $1.283 per square foot per month (95% of $1.35).  This equates to $83,138 per month, or $997,661 for the first year, with a 4% increase each year.  The current monthly rent is $130,084, which equates to $1,561,008 per year.  Thus, the City will receive a $563,347 reduction in rent during this year compared to the current rent.

3.      Update on the Hall of Justice Building

OSHA performed an inspection at the Hall of Justice on August 3, 2006, focusing on the basement and the property vault.  The property vault was closed due to a flaking pipe which may have asbestos concerns based on the visual inspection.  (Note:  Air samples that were previously performed showed NO evidence of asbestos.)  OSHA noted some other concerns and will provide a written report as well as citations, and will be returning next week to inspect the remainder of the building.  We do expect to receive some fines as a result of this process.  We are in the process of addressing the property vault issue first (this should be remediated by Monday, August 7, 2006), and then addressing any other areas of concern.  Swinerton Management and Consulting will be working with the City to address any citations, and to ensure that OSHA understands that, pending a peer review of the original water intrusion remediation report, the Police Department is likely to be relocating in approximately 4 months.  In addition, Risk Management is currently in consultation with an attorney who specializes in addressing OSHA complaints and who is a former OSHA employee.  A copy of the latest employee bulletin regarding this matter will be forwarded to you. 

4.      Rating Agency Update

Jim Goins and Susan Segovia had a conference call with Moody’s Investor Services (Credit Ratings Agency), regarding the interest rate swap portion of the proposed Wastewater Revenue Refunding Bonds.  Since this is the first interest rate swap agreement that the City will be executing, Moody’s requested assurance that the City was informed of and prepared for the complex monitoring requirements, as well as the risks associated with this type of transaction.  Since Finance Department staff has been preparing for and educating themselves on swaps since February, they were able to answer all of the questions, and received praise for the City’s comprehensive swap policy.   By issuing variable rate bonds and entering into the interest rate swap instead of conventional fixed rate bonds, the City will save 46 basis points on interest costs; this translates into approximately $800,000 in additional project funds for use on the Wastewater Enterprise capital projects.

We will keep you informed when credit ratings are finally received for this bond issue.

5.      Nystrom United Revitalization Effort (NURVE)

Design team members and staff representing the West Contra Costa County Unified School District, the Richmond Children’s Foundation, the East Bay Community Foundation, LISC, and the City attended a meeting this week to discuss further the Nystrom United Revitalization Effort (NURVE).  As you may know, this effort involves, among other things, improvements to the Nystrom School campus, improvements to the Martin Luther King Park and Community Center, a potential charter school, improvements to the Maritime Child Care Center, and a “new” Nystrom Village.  The meeting was facilitated by Daniel Iacofano, of MIG, the City’s General Plan consultant.  During the meeting, the group developed and discussed a number of different site development options for the area that would include these many public facilities.  One important consensus of opinion was that, if the new school campus and park is truly going to be transformational from a neighborhood perspective, there also needs to be a significant amount of redevelopment activity on Cutting Boulevard adjacent to the publicly owned spaces.  The next step in the process is for design team members to develop a single, comprehensive design proposal, with, perhaps, several options to evaluate within that proposal, which can be reviewed by community members.  We will continue to keep you informed as this effort progresses.

6.      General Plan Update

The last scheduled General Plan workshop was held last Saturday at St. Cornelius School, and, unfortunately, was fairly sparsely attended.  Richard Mitchell is working with the consultant (MIG) to try to enhance public outreach and develop more opportunities for public input into this planning process.

7.      Graffiti Abatement

You have hopefully become aware (unless you are keeping your eyes unwaveringly fixed to the roadway ahead of you) that there has been a significant graffiti abatement effort completed on the fences that align the railroad property adjacent to I-580.  Thanks go the Public Works Department for this effort.

Feel free to contact me if you have any questions or comments about these or any other items of interest to you.

Have a great week.

Bill Lindsay
City Manager
City of Richmond
1401 Marina Way South
Richmond, CA 94804

Phone:  510-620-6512
Fax:      510-620-6542
e-mail:   bill_lindsay@ci.richmond.ca.us