City Council to Vote on Transit Center Funding

Funding for the Intermodal Transit Center, the city’s venture in an otherwise privately owned waterfront development project, will go before the City Council Tuesday. 

The council will vote on using $671,000 of the city’s Traffic Facilities Development Impact Fees Fund, made up of fees paid by developers for traffic-related improvements, for the project. Roughly one-third of the $671,000 would go to HDR Engineering for work already completed on the transit center.

The ITC is the lynchpin of the city’s waterfront development, a neighborhood filled with replicas of Craftsman-style homes and Victorian townhouses near San Pablo Bay.

Homeowners snatched up properties there in recent years on the promise that the bayside fields beyond the railroad tracks would soon transform into a walkable and bicycle-friendly neighborhood with cafes and shops as well as a ferry terminal, commuter train and bus connections, all within walking distance of one another.

In its application two years ago for federal grants to help pay for the three-pronged project, the city projected the total cost to be around $50 million.  That figure now appears to be climbing toward $70 million, according to a memo consultant and former interim city manager Charles Long submitted to the City Council last week.

The city has already spent $11.8 million on the project, Long said in his report, noting that future costs are anticipated to be an additional $57.8 million.

In 2009 alone, the City Council approved some $4 million in engineering costs for the project and an additional $300,000 for legal fees. For the remainder of this fiscal year, which ends June 30, City Manager Fred Deltorchio said, HDR Engineering will be paid almost $356,000 for their services to the Bayfront/ITC project.

Long was fired by the City Council last December and brought back in January to tackle the Bayfront ITC project. His first task, he told the council, was to stop all engineering work on the project until the city could earmark funds to pay for it. He also cut payments to the engineering project manager from $25,000 to $10,000, about $6,000 less per month than Long is being paid.

Long says in the memo that the city can count on $31.4 million in committed outside funding that will be lost if the project is abandoned.  In addition, the city will need to kick in an additional $10.5 million in local funding, he says in the memo.

He is proposing that the local funding come from a series of temporary cash transfers from funds with positive cash flow such as the city’s wastewater or developer impact accounts. Those advances would then be repaid from whatever proceeds might be realized from the sale of city-owned properties recently transferred from the faltering Redevelopment Agency.

Right of ways will also need to be granted for construction of the ITC, which is planned to be built on land currently owned by Hercules Bayfront LLC.  That challenge, combined with the funding hurdle and the mounting deficit the city is facing "might prove to be so significant that the City Council may decide it does not wish to pursue the ITC project," Long said in his memo.

The council will also vote on directing City Manager Fred Deltorchio to hire an independent third party firm to review the , which were approved by the council at a March 22 meeting. Two firms have submitted proposals, each for $25,000 for initial work on the review, said a report to the council put out by Deltorchio.

Tuesday's City Council meeting is at 7 p.m. at the Hercules City Hall Council Chambers.

Correction: Earlier, this article said Long was hired back by the city in March. He was actually hired back at the end of January.