Coversheet


Agenda Item 3.5.2


TRANSPORTATION AGENCY FOR MONTEREY COUNTY *Memorandum*

To:	Board of Directors
From:	Todd Muck, Executive Director
Meeting Date:	August 28, 2019
Subject:	Fort Ord Property Development Update

RECOMMENDED ACTION:
RECEIVE update on activities related to management and development of TAMC’s Fort Ord property along Highway 1 and AUTHORIZE participation in Fort Ord Reuse Authority's building demolition program.

SUMMARY:
The Transportation Agency owns 12.1 acres of property in the former Fort Ord in the vicinity of Hwy 1 and 8th Street. Seven building built by the Army between 1941 and 1953 are located on the property. Staff is evaluating options to utilize the property including demolition and adaptive reuse. Fort Ord Reuse Authority is pursuing bonding for base-wide building removal.

FINANCIAL IMPACT:

The Transportation Agency maintains a reserve of Monterey Branch Line lease revenues to fund maintenance, repair and efforts to develop future transportation on the Agency owned rail right-of-way. At its March 27, 2019 meeting,The Board of Directors authorized using up to $100,000 to fund expenses related to managing the Agency's former Fort Ord properties, which is well within the available funding in the Branch Line reserve account.

DISCUSSION:

The Transportation Agency acquired 12.1 acres of property on the former Fort Ord as a Economic Development Conveyance after the closure of Fort Ord. Seven buildings totaling approximately 100,000 square feet are located on the property.

The buildings are currently being used for storage by public agencies and local non-profits. Electricity, water and sewer are currently not available at the buildings.These buildings were built between 1941 and 1953 constructed of concrete, or a combination of wood and concrete. Overall the buildings are in fair to poor condition.

To best understand and evaluate the strengths, weaknesses, opportunities and threats to TAMC’s continued ownership of the Fort Ord property, TAMC hired former County Redevelopment Agency Director Jim Cook as a retired annuitant to assist the Agency in conducting this analysis.The activities are required regardless of the development decision that TAMC makes for use of the property. A hazardous material survey has been conducted on the buildings. Tasks underway or to be initiated include completing an existing utilities infrastructure survey; graffiti removal; hazardous materials survey, accommodation and remediation to the extent needed for current uses; development of conceptual reuse alternatives; issuing leases for existing nonprofit tenants; vacating certain poor quality buildings, improving security of buildings, including fencing; and contracting for ongoing security services.

Fort Ord Reuse Authority (FORA) has been evaluating issuing bonds to expedite demolition of surplus buildings on the former Fort Ord. The increment of property taxes currently collected by FORA would be used to repay the bonds. FORA estimates that there is about $55,000,000 worth of building removal left and the bonds will only cover an estimated $37,000,000.

The underlying jurisdictions and other stakeholders are currently working to prioritize which buildings will be demolished. FORA staff produced a building removal prioritization matrix that identifies four of TAMC's seven buildings as high priority for removal. The remaining three TAMC buildings are good candidates for reuse. FORA staff has calculated a demolition cost per square foot based on recent demolition costs on the Former Fort Ord. They estimate that demolishing these four TAMC properties will cost $1,500,000. Demolishing all seven buildings is estimated to cost $3,500,000.

FORA may be ready for bond issuance at the November FORA Board meeting. Transportation Agency staff is seeking conceptual authorization for TAMC participation in the FORA building demolition program. Any financial obligation or policy commitment required from the Transportation Agency will be brought back to the Board for approval.