REPORT TO THE CITY COUNCIL FROM: BRIAN BARR, Director General Services Department GREGORY A. BARFIELD, M.A. Director Department of Transportation SUBJECT ..Title Actions pertaining to a Lease Agreement between the City of Fresno and Eddie Fanucchi for office space located at 1360 L Street (Council District 3): 1. Adopt a finding of Categorical Exemption pursuant to Section 15301/Class 1 of the California Environmental Quality Act (CEQA) Guidelines 2. Approve a Lease Agreement between the City of Fresno and Eddie Fanucchi to lease office space for three years, starting at $58,059 a year with a 3% annual increase, totaling $162,648 over three years in rent ..Body RECOMMENDATION Staff recommends Council adopt a finding of Categorical Exemption pursuant to Section 15301/Class 1 of the California Environmental Quality Act (CEQA) Guidelines, and approve a Lease Agreement between the City of Fresno and Eddie Fanucchi to lease office space for three years, starting at $58,059 a year with a 3% annual increase, totaling $162,648 over three years in rent for office space located at 1360 L Street. EXECUTIVE SUMMARY Transit routes in the downtown area have been disrupted due to ongoing construction and service to the Courthouse Park Intermodal Transit Center has been significantly impacted. As a result, the Department of Transportation, Fresno Area Express (FAX), temporarily relocated the Courthouse Park Intermodal Transit Center to the intersection of L and Tuolumne Streets to avoid many of the street closures in the downtown area. Vacant office space located at 1360 L Street is immediately adjacent to the temporary transit hub and FAX seeks to enter into a Lease Agreement to provide bathroom access to Bus Drivers. FAX anticipates cost savings by leasing this building versus maintaining the current mobile restroom facilities. The term of the proposed lease shall be three years with a negotiated lease rate of $4,388 per month in rent with a 3% annual increase through the end of the term. The lease agreement also includes a non-appropriations termination clause which allows the City to terminate the lease with a 90-day prior written notice, should funding not be approved in the annual adopted budget. BACKGROUND Transit routes in the downtown area have been disrupted due to ongoing construction and service to the Courthouse Park Intermodal Transit Center has been significantly impacted. As a result, the Department of Transportation, Fresno Area Express (FAX), temporarily relocated the Courthouse Park Intermodal Transit Center to the intersection of L and Tuolumne Streets to avoid many of the street closures in the downtown area. Vacant office space located at 1360 L Street is immediately adjacent to the temporary transit hub. The building is a single tenant office building of approximately 3,250 square feet and offers onsite restrooms. FAX is seeking to primarily utilize this space as a convenient restroom stop for Bus Drivers. Bus Drivers previously had access to mobile bathrooms at Courthouse Park. The mobile bathrooms were porta-potty style units which require service several times per week at a significant ongoing operational cost. The mobile bathrooms were parked within the bus turnouts; however this is not possible at the temporary relocated transit center. If the Lease Agreement is approved, FAX will utilize this office space primarily for restroom access for Bus Drivers and other operational support. The restrooms will not be accessible to the public. FAX anticipates operational savings utilizing the office space for restrooms versus maintaining and staffing mobile restroom units. The term of the proposed lease shall be three years with a negotiated lease rate of $4,388 per month ($1.35 per square foot) in rent with a 3% annual increase through the end of the term. The lease agreement also includes a non-appropriations termination clause which allows the City to terminate the lease with a 90-day prior written notice, should funding not be approved in the annual adopted budget. The lease agreement has been approved by the City Attorney's Office as to form. ENVIRONMENTAL FINDING Staff has performed preliminary environmental assessments of this project and has determined this project is exempt under Section 15301/Class 1 (Existing Facilities) of CEQA Guidelines as it involves no alteration of existing facilities, with no expansion of use. Furthermore, none of the exceptions to Categorical Exemptions set forth in CEQA Guidelines, Section 15300.2, apply to this project. LOCAL PREFERENCE Local preference was not considered because this item does not include a bid or award of a construction or service contract. FISCAL IMPACT The lease payments have been included in the adopted FY2026 Department of Transportation budget. Funding for future years has been included in the proposed FY2027 budget and will be included in the appropriate fiscal year's budget subject to Council approval. Attachments: Categorical Exemption Lease Agreement Levine Act Disclosure