To pursue alternatives to its management of the SR 710 properties, Caltrans should prepare a cost-benefit analysis to determine if the State would save money by hiring a private vendor to manage the properties. If such savings would occur, Caltrans should seek an exemption under Government Code, Section 19130 (a), to hire a private vendor.
Because the cost-benefit analysis did not lead to a clear preferred option for property management, Caltrans and CalSTA decided to not pursue any of the three alternatives evaluated in the consultant's report. Instead, Caltrans will continue to perform property management activities. As noted in the status to recommendation No. 39, the Affordable Sales Program regulations were recently approved and Caltrans is moving forward with the sale of surplus properties. Selling the properties will allow Caltrans to reduce its inventory and associated property management activity.
Caltrans and CalSTA are continuing to pursue the goal of eliminating Caltrans' role in managing SR 710 properties. As stated in the status to Recommendation No. 39, Caltrans and CalSTA are currently in the process of submitting proposed Affordable Sales Program regulations to be adopted by the Office of Administrative Law by the end of the year. Caltrans recently submitted a request for proposal for consultant contract management of the sales process. Although the scope of work for the Sales Program does not include property management, the sales effort is directed toward expeditious reduction in property management activity.
Caltrans and CalSTA are continuing to pursue the goal of eliminating Caltrans' role in managing SR 710 properties. Caltrans and CalSTA are currently in the process of adopting Affordable Sales Program regulations which will result in the sale of surplus properties beginning in 2015. A component of the Sales Program may result in contract management of all or part of the sales process by another entity. If so, the scope of work for the Sales Program may include some elements of property management. Therefore, Caltrans and CalSTA are no longer evaluating any of the three options investigated in the consultant's report.
Please refer to our one-year response.
In light of the Cost-Benefit Analysis Study, which led to no clear preferred option, Caltrans and CalSTA continue to hold discussions with legislators to pursue the goal of eliminating Caltrans' role in managing the SR 710 properties.
Caltrans hired a consultant to perform an independent cost-benefit analysis of the following property management options for the SR 710 properties: hiring a private vendor, establishing a JPA, and transferring the properties to a local transportation entity. The consultant completed the analysis and concluded that none of the options would be deemed favorable to the State from a financial perspective. Caltrans and the agency are reviewing the final report and will work with the Legislature to determine the best option for Caltrans, the State, and the tenants.
Caltrans stated it hired a consultant to perform an independent cost-benefit analysis of the following property management options for the SR 710 properties: hiring a private vendor, establishing a JPA, and transferring the properties to a local transportation entity. The local transportation entity would take over ownership and management of the properties and use the proceeds of the sale for local transportation improvements. Caltrans also stated that its first meeting with the consultant would be held in October 2012 to develop a work plan with target dates. (See 2013-406, p. 178)
†Response Type refers to the interval in which the auditee is providing the State Auditor with their status in implementing recommendations made in an audit report. Auditees must submit a response regarding their progress in implementing recommendations from our reports at three intervals from the release of the report: 60 days, six months, and one year or subsequent to one year.
*Agency responses received after June 2013 are posted verbatim.