REPORT TO THE CITY COUNCIL FROM: NICHOLAS D. MASCIA, PE, Assistant City Manager Interim Director - Capital Projects Department SCOTT L. MOZIER, PE, Director Public Works Department BY: KEVIN GROSS, PE, Assistant Director Capital Projects Department, Transportation Project Management Division AUSTIN M. BAIN, Licensed Professional Engineer Capital Projects Department, Transportation Project Management Division SUBJECT ..Title Action pertaining to the declaration of surplus personal property in support of the Blackstone McKinley BNSF Grade Separation Project: (Council Districts 1 and 7) 1. ***Resolution - Declaring certain City-owned materials and equipment as surplus personal property and authorizing their sale at public auction to the highest bidder. (Subject to Mayor's Veto) ..Body RECOMMENDATION Staff recommend the City Council declare certain materials and equipment as surplus personal property and authorize their sale at public auction to the highest bidder. EXECUTIVE SUMMARY In support of the Blackstone McKinley BNSF Grade Separation Project (Project), the City is in escrow to acquire parcels and associated business assets located at Assessor's Parcel Numbers 451-071-07, 451-071-08, 451-071-09, 451-071-10, 451-071-23, 451-071-25, and 451-071-38 (previously owned by Rocking Rail LLC). As the use of grant funds are restricted to Project-related purposes, the business assets acquired are ineligible for general municipal use. Staff seeks Council approval to declare these materials and equipment as surplus personal property and authorize their sale at public auction. Proceeds from the sale will be returned to the Capital Improvement Project account in compliance with Measure C and California Local Partnership Program Formulaic grant requirements. The project is funded with Measure C Grade Separation Program funds, Local Partnership Program Formulaic grant funds, and by Transit and Intercity Rail Capital Program grant funds. BACKGROUND The City of Fresno is undertaking the Blackstone McKinley BNSF Grade Separation Project to enhance public safety and traffic flow by eliminating two at-grade railroad crossings. As part of this Project, the Council approved an Agreement for Purchase and Sale of Improvements Pertaining to the Realty and Business Furniture, Fixtures, and Rolling Stock and Escrow Instructions to acquire all improvements, business fixtures and rolling stock as identified in the associated Bill of Sale, owned by Jet Black Logistics, Inc., a California corporation, doing business as E-Z Haul Ready Mix and Star Building Supplies for an amount of $2,872,250.00 for the construction of the Blackstone McKinley BNSF Grade Separation Project located on Assessor's Parcel Numbers 451071-07, 451-071-08, 451-071-09, 451-071-10, 451-071-23, 451-071-25, and 451-071-38 on January 9, 2025. The acquired business assets are ineligible for municipal use due to grant funding restrictions. Measure C and California Local Partnership Program Formulaic funds require that proceeds from the sale of these assets be returned to the Capital Improvement Project account with any remaining funds at the conclusion of the project to be returned to the granting agency. In accordance with Fresno Municipal Code Section 4-202, the City Council must declare the assets as surplus personal property and direct their disposition. The materials and equipment described in Exhibit A of the Resolution must be sold through a public auction to ensure compliance with grant requirements. Proceeds from the sale will be deposited into the appropriate Capital Improvement Project account, with any remaining funds returned to the granting agencies, as required by grant funding guidelines. Unsold items will be evaluated for scrap material value, donation, or disposal as appropriate. Seeking Council authorization of the City Manager, or their designee, to execute any and all documents necessary to carry out these actions. The project is funded with Measure C Grade Separation Program funds, Local Partnership Program Formulaic grant funds, and by Transit and Intercity Rail Capital Program grant funds. The City Attorney's Office has reviewed and approved the Resolution as to form. ENVIRONMENTAL FINDINGS In 2020, the City determined that the Blackstone Avenue & McKinley Avenue BNSF Grade Separation Project is exempt from environmental review under the California Environmental Quality Act (CEQA), pursuant to California CEQA Guidelines section 15282(g). Declaring City-owned personal property as surplus and disposing in accordance with 4-202 of the Fresno Municipal Code does not create an exception to the exemption. Therefore, no further CEQA compliance action is necessary. LOCAL PREFERENCE Local preference was not considered because this item does not include a bid for or award of a construction or services contract. FISCAL IMPACT The Blackstone Avenue & McKinley Avenue BNSF Grade Separation Project is within Council Districts 1 and 7. This request will have no impact to the General Fund. The project is funded with Measure C Grade Separation Program funds, Local Partnership Program Formulaic grant funds, and by Transit and Intercity Rail Capital Program grant funds. Attachment: Resolution w/attached Bill of Sale with Exhibit A to the Bill of Sale - List of Business Assets and Appraisal Vicinity Map