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Title:
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Adopt a Resolution to Approve and Authorize the City Manager to Execute a Lease Agreement Between the City of San Leandro and As Kneaded for the Food Service Space and One Specific Parking Space at the Main Library for $2,550.00 Per Month for a Two-Year Term, with Three One-Year Extension Options for a Total Term Not to Exceed Five Years
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Title
Adopt a Resolution to Approve and Authorize the City Manager to Execute a Lease Agreement Between the City of San Leandro and As Kneaded for the Food Service Space and One Specific Parking Space at the Main Library for $2,550.00 Per Month for a Two-Year Term, with Three One-Year Extension Options for a Total Term Not to Exceed Five Years
Staffreport
COUNCIL PRIORITY
* Quality of Life
* Economic Development
SUMMARY
The City looks to fill the Main Library food service space with an outside vendor. An RFP was issued March 10, 2025. It was posted on the City's website and advertised in the Daily Review. Eight responses were received. All eight responses were first given qualification scores by three reviewers on six criteria that totaled to a possible of 100 points. The three highest qualified candidates with responsive bids were interviewed separately. The decision to move forward with As Kneaded was made based on this process.
RECOMMENDATIONS
Staff recommend that the City Council authorize the City Manager to approve a lease agreement with As Kneaded for the food service space and one specific parking space at the Main Library for $2,550 per month for a two-year term, with three one-year extension options for a total term not to exceed five years. The lease is inclusive of all utilities and possessory interest tax.
BACKGROUND
When the Main Library was expanded in 2000, a food service space was created to sell items to the public. The Library Department operated that space as a caf? with paid City staff for 24 hours out of 58 possible library open hours per week. The operation was costly and was difficult to staff. The City lacks the food service expertise, staff with health code credentialing, and it was challenging to recruit for the caf? job duties. The COVID-19 pandemic caused the closure of the caf?. While the caf? and Library were closed, the three part-time staff that had worked in the caf? began to prioritize other jobs and/or other life goals as they were nearing retirement. When the Library reopened and attempted to reopen the caf?, the existing staff could no longer work the hours they used to that would have kept the caf? open 24 hours per week. Furthermore, all three caf? staff began retiring over the next few years. In 2023, the Library analyzed the caf? operation and found that for the past 10 years it operated at a significant loss each year, averaging a $23,390 deficit annually.
In 2023-2024 the Library conducted 35 strategic planning community focus group sessions with different ages, ethnicities, and backgrounds. A desire for a food service vendor at the Main Library was expressed in nearly every focus group. The groups further expressed a desire for the Library Rules of Conduct to allow food items in the Library. February of 2024, the Library Rules of Conduct were updated to allow snack items.
Upon the retirement of the final City staff caf? employee on April 27, 2025, the Library operated caf? closed.
To fulfill the demand for a food service provider in the Main Library, the City issued RFP #63018 For Food Service Provider at Main Library on March 10, 2025. It was open until 5:00PM April 10, 2025.
Analysis
Subsequent to the closure of the RFP, a panel of three staff reviewers scored the proposals on the following six factors contained in the RFP:
* Fit with the existing facility;
* Fit with the Library's food policy;
* Hours of operation overlap with Library hours of operation;
* Experience in retail food service;
* Monthly rent proposed; and
* Business readiness.
How proposers responded to these factors were scored by the three reviewers to generate a composite score for each proposer with a total possible maximum of 100 points. From this review, three finalists with the highest qualification scores and fully responsive bids were selected for in-person interviews, which led to a final selected vendor.
Based on the qualification scores and interviews with the three highest qualified candidates with fully responsive bids, As Kneaded was chosen as the proposer with the first right of refusal to negotiate a lease with the City. As Kneaded accepted that opportunity, negotiated, and it has signed the lease included with this report for City Council approval. Out of all eight bids, As Kneaded's proposed rent was the most reliable fixed revenue proposed. A strong fixed revenue proposal was preferred over other candidates' variable rent revenue options that offered a percentage of monthly revenue. Additionally, in the interview As Kneaded demonstrated a good fit and a willingness to meet the Library's operational needs. As Kneaded has a history of success in food service retail, starting from scratch in 2016 in San Leandro as a minority and female owned and operated business. As Kneaded was named as one of the Top 100 Bakeries in America by Food & Wine Magazine.
Staff have received inquiries and public records requests for information and data from the RFP. This information and data is not public information at this time. Pursuant to the California Public Records Act, proposals submitted in response to a RFP and master averaged score sheets from the initial evaluation shall be made available upon a public records request only after all of the following three steps in the process have been met:
1. The proposal evaluation process is complete;
2. A contract has been negotiated; and
3. Notice of intent to award has been made and the contract has been approved by the City Council.
Once all three of these steps have been met, staff will be able to respond to inquiries and public records requests on this matter.
Summary of Public Outreach Efforts
* July 2023, 35 Library Strategic Planning Focus Groups were conducted, with nearly every focus group supporting food service at the Main Library, and no opposition.
Legal Analysis
The City Attorney drafted and/or reviewed the applicable documents and agreements and approved them as to form. The Lessee has agreed to the terms of the lease.
Financial Impacts
The Fiscal Year 2025-2026 General Fund is positively impacted with an increase in revenue source. Once fully executed, this agreement will generate $2,550/month or annually $30,600 in revenue. There are no expenditures for this agreement.
ATTACHMENTS
Attachment A: Resolution to Approve and Authorize the City Manager to Execute a Lease Agreement Between the City of San Leandro and As Kneaded for the Food Service Space and One Specific Parking Space at the Main Library for $2,550.00 per Month for a Two-year Term, with Three One-year Extension Options for a Total Term Not to Exceed Five Years.
Attachment B: Original Lease of Real Property between the City of San Leandro and As Kneaded
PREPARED BY: Brian Simons, Library Director, Library Services Department