DATE: November 6, 2018
TO: Board of Supervisors
SUBMITTED BY: Delfino E. Neira, Director of Social Services
Robert W. Bash, Director of Internal Services/Chief Information Officer
SUBJECT: First Amendment to Lease Agreement 17-646
RECOMMENDED ACTION(S):
TITLE
Approve and authorize the Chairman to execute First Amendment to Lease Agreement No. 17-646 with Pontiac 2, LLC, at 3500 Pelco Way, Clovis, CA 93612, for Tenant Improvements, increasing the office space from 21,966 square feet to 172,000 square feet and reducing the warehouse space from 87,117 square feet to 0 square feet, and Renewing the lease for one (1) nineteen-year period upon completion of Tenant Improvements, total not to exceed ($146,277,990).
REPORT
Approval of the recommended action will amend the current agreement to create a nineteen-year lease for 172,000 square feet of office ($1.35/square foot, with increases every year) for the Department of Social Services (DSS). The Agreement maximum for the first year is $ 7,135,614, with no increase in Net County Cost. This item pertains to a location in District 3.
It should be noted that this Lease Amendment contains a provision that if the County terminates this Lease prior to the completion of the amortization period to pay for the Tenant Improvements, then the County must pay to the Lessor, in one lump sum, an amount equal to the unamortized principal balance of the County's share of the cost of the Tenant Improvements ($40,932,435) within forty-five (45) days after the Lease termination date. It is the opinion of the DSS Finance Chief that any lump sum payments caused by the County terminating a lease early would not be claimable to State and Federal funding, and would need to be paid through the County General fund.
ALTERNATIVE ACTION(S):
Your Board could direct the Department of Social Services to not renovate the building. However, this would result in an office space which does not meet the long term operational needs of the Departm...
Click here for full text