A $48 million funding increase for a new Metropolitan Transportation Commission office building in San Francisco was approved by an oversight committee this morning in Oakland.
MTC Executive Director Steve Heminger presented an updated cost and funding plan for the new building at 390 Main St. in San Francisco to the Bay Area Toll Authority Oversight Committee.
The MTC is now housed at 101 Eighth St., along with the Association of Bay Area Governments.
The Bay Area Headquarters Authority, an MTC subgroup heading the efforts to establish a new MTC headquarters, purchased the downtown building in late 2011 for $93 million.
The initial budget for the building purchase and renovations was totaled at $167 million, Heminger said.
The total budget has been revised to an estimated $215 million, and was unanimously approved this morning by the committee.
“I regret coming to you and asking for more money,” Heminger said.
The revised budget presented today included more seismic retrofit costs and the construction of an atrium, which will provide natural light and lessen the mass of the building.
Initial seismic estimates were $1 million and have been raised to $11 million, Heminger said.
The atrium is estimated to cost $3 million to construct, but the MTC hopes it will help attract commercial tenants to rent about 25 percent of the building to offset long-term costs.
Also contributing to the inflated budget is the inclusion of furniture, fixtures and other equipment costs, which are usually not included at this part of the budgeting process, Heminger said.
Those costs total about $15 million.
The new funds from the toll authority is only expected to be $32 million after ABAG and the Bay Area Air Quality Management District contribute funding for their portion of construction costs as co-tenants of the new San Francisco building.
Other deductions expected to lower the cost include MTC-held reserves and federal grants, Heminger said.
Heminger said that according to conservative estimates from the Bureau of State Audits about returns on the project over the course of the next 30 years, depending on different tenant scenarios and building and land value, the building is expected to lose $14 to $20 million, which experts consider a minimal loss.
“I consider that a good day’s work,” Heminger said.
Sasha Lekach, Bay City News