Minutes - October 2020 Board Meeting
Regular Meeting of the Board of Directors
City of San Francisco Japan Center Garage Corporation
(A California Non-profit Public Benefit Corporation)
Thursday, October 15, 2020 – 11:00 a.m.
Zoom Meeting
MINUTES
Present: Ed Ong, Green Chang, Rodney Chin, Hagen Choi, Arcadi Kolchak, Vas Kiniris, Kim Kolbe, Keiko Murase, John Noguchi, Jerry Ono and Jan Masaoka
Absent: None
Also present: Rob Malone, MTA; Claudine Cheng, Corporate Counsel; Richard Hashimoto, Corporate Manager; Alan Wong, Fred Bekele and Solomon Abayneh, IMCO; Grace Horikiri, Japantown Community Benefits District and Benjamin Lau, Macias, Gini and O’Connell
1. Call To Order
President Ong called the meeting to order at 11:04 am
2. Approval of Minutes from Regular Meeting of August 20, 2020 (Action Item)
A motion to approve the Minutes was made by Director Ono and seconded by Director Kiniris.
The motion was unanimously approved.
3. Board President’s Report (Action Item)
Board President Ong announced an action item for the meeting will include discussion of the CPMC parking agreement and that Director Chang has agreed to chair the Nomination Committee.
4. Corporate Manager’s Report
a. Submission was filed with the SBA for the forgiveness of the $41,600 PPP loan.
b. Following up on last meeting’s discussion, the following domain names were purchased – japantowngarage.org, japantowngarage.com and japancentergarage.com
c. After the reopening of the Japan Center Malls on September 1, there was an increase in transient and monthly parking.
d. For the past 6 and a half months of shelter-in place, usage and revenues both saw drastic decreases. There was a slight increase in transient vehicles from the malls reopening, but revenue was still negative at 55% from prior year/month.
e. On September 28, a termination letter was received from CPMC and matter will be discussed during Contract Committee report.
f. Garage Manager Alan Wong was re-assigned to another garage and the new manager is Solomon Abayneh.
g. The garage hours were adjusted to the Mall’s schedule. Also, both the janitorial and security services were suspended and some of these duties were taken up by corporate and operation staff.
h. Picnic in the Plaza is a big success, averaging around 1,300 visitors over the weekends.
However since the reopening of the malls, the number has gone down slightly.
i. A total of 12 businesses have closed of which 9 was attributed to the pandemic. The 3 others closed for economic reasons unrelated to Covid-19 or lease expirations.
Directors’ Questions:
Director Noguchi asked about increases in transient parking over the weekends.
Corporate Manager responded that since the malls have reopened, there are
noticeable increases in foot traffic and the restaurants were doing well despite the
health order but not sure for how long.
Director Choi asked if any restaurants were taking advantage of the shared spaces
program. There are four restaurants participating in the program.
President Ong asked whether there was any news from AMC Theater. Corporate
Manager responded that he did meet with the AMC owners and future plan was
uncertain.
5. Corporate Counsel’s Report
Corporate Counsel indicated that she would defer her comments to the committee reports.
6. SFMTA Updated
a. Mr. Malone shared that in response to the termination of the CPMC parking
agreement, the SFMTA has approved a decrease of the monthly parking rate from
$205 to $180 to match parking rates offered by garages in the area.
b. MTA was also considering a debit card program for parking at the flat rate of $15 day.
Hopefully, this will appeal to those who only come in to work couple days a week.
c. Throughout the city, there was a gradual increase in parking from week to week. The
financial picture was satisfactory for the time being but the long-term effect of the
pandemic is uncertain.
Directors questions:
Director Murase asked if CPMC has requested a fee decrease. Corporate Manager
responded that with the SF Park program in place, the MTA evaluates the parking
demand and adjusts parking rates quarterly to ensure maximum utilization. Due to
demonstrated demand, there has been no adjustment in the fee.
Director Kiniris indicated that he was working with Cruise to deploy the driverless cars
and asked about possibilities if there is a need for parking space. Mr. Malone
responded that the MTA has been in touch with Cruise to access the company’s
parking needs and considering couple of MTA locations.
Director Chin asked about the Geary Street Rapid Transit. Corporate Manager is a
member of the Citizens Advisory Committee and shared that work is in progress for
the pedestrian walkways including the Buchanan St. crosswalk. There was a need to
make sure that the construction work does not interfere with entrance to the garage.
7. Treasurer’s Report
Treasurer Chin discussed highlights of the May and June financial statements. The new fiscal
year started on May 1, shortly after the shelter-in-place order was issued. At the beginning,
revenue was below 10% of budget and expenses were down as well. In June, due to partial
re-opening, the revenue went up to 16% of budgeted revenue.
Director Masaoka asked Mr. Malone about how other city garages were doing. Mr. Malone
responded that back in March and April, the MTA had to make very difficult choices with the
parking operators to furlough and layoff employees. Pre-pandemic revenue was about $3.25
million and FTE was at 200 and now, FTE was at about 95. There was a 50% cut in the budget.
Labor costs are typically 85% - 80% of expenses. In April and May, income was negative then,
starting in July, the expense side of the budget started to clear down to bare minimum. As of
mid-June, revenue started to go up as some businesses re-opened. In July / August, revenue
went back to about 1 million; it was stabilized but nowhere near the pre-Covid times.
Director Masaoka then asked how the private sector parking garages were doing and Mr.
Malone said he would follow up.
A motion to accept the Treasurer's Reports was made by Director Noguchi and seconded by
Director Kochak. The motion was approved unanimously.
8. Committee Reports
A. Audit and Finance Committee
Benjamin Lau from accounting firm Macias, Gini and O’Connell (MGO) presented highlights of
their audit report.
It was a ‘clean audit’ with no material issues or conflicts to report.
With Covid-19 in the last two months of the fiscal year, there was a clear impact from
the uncertainties.
Ref. P. 6. Compared to the previous fiscal year, there was a significant difference in
economic and other factors due to the impact of Covid-19 starting in March 2020. In
March and April, the corporate revenue was less than expected and showed a deficit.
Pursuant to agreement with MTA, if there was positive net revenue, the set monthly
distribution of $37,500 would go into the corporation’s capital account. If there is a
net deficit, then the corporation would defer the monthly distribution that will be
reflected in the corporation’s financial statement.
Ref. P.13. Pursuant to the lease agreement, there is a formula to calculate monthly
distribution. If there is a net deficit, the corporation should be able to carryover.
More discussion with MTA is needed to determine how to manage deficit.
Corporate Manager thanked Mr. Benjamin Lau and MGO for their hard work, especially
related to COVID-19 impacts and numerous discussions with MTA Finance.
A motion to approve the audit report was made by Director Noguchi and seconded by
Director Choi. The motion was approved unanimously.
B. Contract Review Committee
1. Amendment to IMCO contract adding a year.
Since the pandemic, the MTA has requested the parking corporation to consider extending
the existing operator Agreement that is currently on final extension. The contract started
in May 1, 2012 for a 5 years term, and then in April 2017, it was extended for a 2 years
term, and again in April 2019 for another 2 years, ending the agreement in April 2021
(final extension). Due to Covid-19 and problems related to issuing RFP, the proposal is to
extend the contract for one year ending in April 2022.
Corporate Manager clarified that the extension will not involve any increase in fees and
that this would be the last extension.
Counsel Cheng indicated that she has reviewed the proposed amended document and
supports an increase in concept pending final wording of the document.
A motion to approve the proposed extension was made by Director Choi and seconded by
Director Masaoka. The motion was approved unanimously.
2. Proposed new parking rate in response to termination of CPMC parking agreement.
Upon receipt of the termination letter from CPMC, the Corporate Manager, Corporate
Counsel and President Ong met with Mr. Malone of SFMTA to discuss rate adjustment in
the hope of retaining and attracting parkers. Corporate Counsel Cheng reported on
successful effort to change monthly rate to mitigate the loss of revenue from CPMC and
the exploration of the debit card program.
Corporate Manager elaborated that the CPMC agreement accounted for 340 spaces at
$205/month, bringing in revenue of $69,700 a month and $836,400 a year. With the
termination of the contract on November 30, there would be a loss of approximately
$348,500 in revenue for the fiscal year.
In response to a question from a Director, is the new parking rate available to the general
public? Mr. Malone responded that all rates must be offered to the public.
Corporate Counsel also thanked MTA for making the rate adjustment in a timely manner
and emphasized the importance of publicizing the new rates. Mr. Malone said the agency
will start publicizing the information towards end of October.
Director Kirinis asked if debit card program is for an individual or a vehicle. Mr. Malone
stated that typically a card is assigned to one vehicle but accommodations can be made
taking into consideration various reasonable scenarios. The key is that each card is only
good for the use of one parking space. Corporate Manager added that the access card
must match the license plate upon entry and confirmed that it can only be used for one
parking space.
A motion to adopt the new rate adjustments and debit card program was moved by
Director Noguchi and seconded by Director Kirinis. The motion was unanimously
approved.
Corporate Manager thanked Mr. Malone for his advocacy on behalf of the garage and that
the $180 monthly rate will be competitive. Mr. Malone added that the MTA has adopted
general policies that it will remain flexible for the period during the Shelter in Place, such
as the shared space program and other ideas that are out of the box, subject to review in
the future when circumstances change.
Lastly, Mr. Malone responded to an earlier question regarding the status of private
parking garages, the information he obtained during the meeting, about 40% of the
private garages in the city remained closed.
C. Community and Marketing Funds Committee
1. Update on website – Corporate Manager shared website designer Greg Viloria’s
report. The new website is live and page views have increased as businesses re-
opened. Regarding changing the domain name of the website, that has to wait until
the third week of October.
2. CPMC parking termination – To offset the lost revenue, the new parking rates will be
posted on the garage’s website and social media. Corporate Manager indicated that
with the new rates, he expects to see an increase in monthly parking.
9. Community Updates
Grace Horikiri from the Japantown Community Benefit District provided an update:
A community walk with Police Chief Bill Scott took place earlier in October.
The safe camera program was being implemented according to plan and Grace
thanked Corporate Counsel Cheng for helping for obtaining crime statistics data from
SFPD and the program resulting in 12 arrests.
The Heart of Japantown Resiliency Fund was successful and raised a total of $504,000.
A total of about 80 businesses have received grants of $5,000 from the Fund.
13 restaurants participated in the outdoor dining shared space program.
It is anticipated that 2 Japantown CBD staffs will take up monthly parking.
10. Garage Operations and Security Report
Alan Wong provided a summary of the Report He also introduced his replacement, Mr.
Soloman Abayneh who has 30 years of experience with parking garages, including as site
manager of 6 MTA garages. Mr. Malone also expressed confidence in Mr. Abayneh’s
experience and would do an excellent job for the Japan Center Garages.
11. Recess to Closed Session
There was no closed session.
12. General Public Comment on Items Not on Agenda
Corporate manager indicated that there was no member of the public in the queue.
13. Old/New Business, Future Board Agenda Items, Announcements, etc.
None
14. Regular Meeting Adjournment (Action Item)
Adjourned at 12:24 pm.
Respectfully submitted,
Jan Masaoka
Secretary