Staging area
Half Moon Bay city leaders say every municipality needs a corporation yard, in part to store the many things necessary to run a city. Review file photo

The Half Moon Bay City Council is continuing to pursue finance options to purchase the property at 880 Stone Pine Road for about $3 million despite a precarious economic situation caused by the coronavirus pandemic.

Earlier this year, the city entered into a purchase agreement with the Peninsula Open Space Trust to acquire the 20-acre parcel. The city plans to continue using the space as its corporation yard — a place to park vehicles and stage for Public Works projects.

“We’re now in escrow, which was done before this current situation, so it makes for an interesting challenge in looking for the best way to finance it,” City Manager Bob Nisbet said. “Everything is a choice. So, if we make this expenditure, it’s a risk of not making another expenditure. Are we spending precious resources that are going down?”

The property was first purchased by the city in 2004 as a possible site for a community park and maintenance yard. POST assisted in that purchase by providing a loan for the sale. Plans for a park never fully materialized after opposition from the community. Financial difficulties brought on by litigation over the Beachwood property and the subsequent recession kept the city from realizing its plans. POST took title to the property, and the land trust allowed the city to use it as a corporation yard in exchange for management of the land.

About two years ago, POST indicated it wanted to sell the property, offering it first to the city.

Deputy City Manager Matthew Chidester said having a corporation yard is vital for the city’s operations. It’s the site where the city’s vehicles are stored, construction materials are kept, and where garbage is sorted before it’s picked up.

“In any circumstance, a city needs a corporation yard,” Chidester said.

The property on Stone Pine Road is seen as the only option for available land the city can use for such a purpose.

“The options are limited on the coast. We only found one viable option and that would take a lot of effort to make it work,” he said.

Public Works Director John Doughty said initially the city owned land next to the Sewer Authority Mid-coastside treatment plant that could have been used for a corporation yard, but the California Coastal Commission deemed that land environmentally sensitive habitat.

City staff would like the maintenance yard to remain at 880 Stone Pine Road, leaving the council to decide how to complete the $2.2 million sale and how to finance an additional $1 million of improvements needed to protect vehicles from the Coastside climate. Before COVID-19, city staff was looking at utilizing available cash to make the acquisition.

“Now, that is not an option at all,” Nisbet said.

Two remaining alternatives are seeking a commercial lender or, the more favorable option, getting a loan through the California Infrastructure and Economic Development Bank, which was established to finance public infrastructure.

Nisbet said city staff is exploring options with the state’s I-Bank. With the city expecting to have a multimillion-dollar deficit by the end of this fiscal year — and even larger losses the following year — some wonder whether the city can afford the land. Others view it as a long-term investment the city needs to make.

Councilwoman Debbie Ruddock said she is in favor of proceeding with this sale.

“It would be short-sighted of us to kill this,” she said.

Mayor Adam Eisen agreed with Ruddock, but acknowledges the optics of the purchase do not look good under the circumstances.

“The timing of this couldn’t be worse,” he said. “But this is something we have to do.”

City staff will present more information about the two feasible options at an upcoming council meeting.

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