REPORT TO THE CITY COUNCIL October 12, 2017 FROM: JERRY DYER, Chief of Police Police Department SUBJECT ..Title Actions pertaining to Lease Agreement for Northwest District Police Station to be located at 3080 - 3082 W. Shaw Avenue: 1. Adopt a finding of Categorical Exemption Class 1 Section 15301 (Existing Facility) and Class 32 Section 15332 (In-Fill) of the California Environmental Quality Act Guidelines 2. Approve Lease Agreement between the City of Fresno and Ami Winepress, L.P. to lease commercial space along Shaw Avenue for the Northwest District Police Station and authorize the Chief of Police to execute related documents. (Council District 2) ..Body RECOMMENDATION Staff recommends that Council make the above-noted environmental findings and approve and authorize the Chief of Police to enter into the attached Lease Agreement with Ami Winepress, L.P. to lease the office space located at 3080 - 3082 W. Shaw Avenue, Fresno, California 93711, for a Northwest District Police Station (the "Proposed Shaw Station"). EXECUTIVE SUMMARY The Fresno Police Department (FPD) has located space along the West Shaw Avenue corridor to establish a police station in the Northwest Policing District. Due to reorganization of the City's policing district's the existing police station for this district is now outside of the service area. Further, due to an increase in rent and need for additional space, Staff began exploring a new location for the station. The FPD engaged the City's Asset Manager, Cushman & Wakefield, to identify potential locations for the station and to negotiate a lease. Upon selecting the subject location, the Asset Manager negotiated a lease term of ten years for approximately 10,240 square feet of commercial office space. BACKGROUND Last year the FPD reorganized the City's policing districts and adjusted their respective boundaries to improve response times to calls for service. As a result, the current Northwest District Police Station, located at 3789 N. Hughes Avenue, (the "Hughes Station") is no longer located within the boundaries of the Northwest Policing District. Additionally, in January of 2017, the FPD also received a rent increase letter from the owner of the property of the Hughes Station, stating that the Lessor would be exercising its right to increase the base rent since the City was on a month-to-month basis as a holdover tenant. The rent has increased incrementally since April 2017 and will continue to do so unless the City enters into a new lease at this location. As the Hughes Station is approximately 6,450 square feet, it no longer meets the needs of the FPD. Under the above circumstances, staff began exploring a new location for the Northwest District Police Station and engaged the City's Asset Manager, Cushman & Wakefield, to determine potential locations and negotiate a lease. Following negotiations with the owner of the Proposed Shaw Station location, it has been agreed, among other terms, that: * The initial lease term will be ten years; * The lease shall be for approximately 10,240 square feet; * The owner will be responsible for completing all tenant improvement, but the City will reimburse the owner for up to $500,000 in tenant improvements; * Initial monthly rent will be approximately $15,565 per month ($1.13 per square foot rent plus $0.39 per square foot for common area maintenance); * The City will be responsible for utilities (including electricity, water and gas); The proposed Lease Agreement is attached hereto and has been reviewed and approved as to form by the City Attorney's Office. ENVIRONMENTAL FINDINGS Staff has performed a preliminary environmental assessment of this project and has determined that it falls within the Categorical Exemption set forth in CEQA Guidelines 15301 and 15332. Section 15301/Class 1 exempts the permitting, leasing, licensing, maintenance or minor alteration of existing facilities involving negligible or no expansion of the use beyond that existing at the time of the lead agency's determination. The project proposes to lease an existing building and will involve negligible expansion. Section 15332/Class 32 exempts' projects characterized as in-fill development as follows: (a) the project is consistent with the applicable general plan and zoning designation; (b) occurs within city limits on a project site of no more than five (5) acres surrounded by urban uses; (c) has no value as habitat for endangered, rare or threatened species; (d) does not result in any significant effects relating to traffic, noise, air quality, or water quality; and (e) can be adequately served by all required utilities and public services. The proposed Police substation is allowed in the RMX (Regional Mixed Use) zone district, subject to a conditional use permit and is within the City of Fresno on a property that is less than 5 acres. The project site is located within a completely urban area on a completely built out site with no potential for impacts to endangered species. In addition, the proposed police substation will not result in significant impacts related to traffic noise or air quality given that property was previously used for retail uses and no new square footage is being added. The site can be adequately served by all required utilities and public services. Furthermore, none of the exceptions to the Categorical Exemptions set forth in CEQA Guidelines Section 15300.2 apply to the project. LOCAL PREFERENCE Local preference is not applicable because this is not a contract for goods, services, or public work of improvement. FISCAL IMPACT Pursuant to the proposed Lease Agreement, the City will not be responsible for rental payments until the completion of the required tenant improvements. Nonetheless, staff anticipates that rent and reimbursements will be due during the Fiscal Year ("FY") 2018 and included in the Police Department's FY 2018 Budget. Rents and reimbursements for tenant improvements will be made from the General Fund. Attachment: Lease Agreement