It was legal for the Metropolitan Transportation Commission to use $180 million in bridge toll money to buy an office building in downtown San Francisco but the transaction exposes toll payers to undisclosed financial risk, an audit concluded Tuesday.
California State Auditor Elaine Howle said in a 51-page report that legal counsel advised her that a court likely would decide that the costs for acquiring a former U.S. Postal Service building at 390 Main St. in San Francisco for the MTC and its staff "are direct costs that can be paid from gross annual revenues" from the seven state-owned bridges in the Bay Area.
However, Howle said the MTC, which is the transportation coordinating and financing agency for the nine-county Bay Area, "could have done more to clearly articulate to both their board and the public the financial risks" of the building purchase, which was completed last October after several years of planning and meetings.
Howle said the MTC didn't discount the value of future cash flows to Tuesday's tax dollars and her analysis indicates that cash flows could fall short of repaying contributed toll revenues by $30 million.
The MTC has been located at 101 Eighth St. in Oakland, across the street from the Lake Merritt BART station, for more than 40 years but announced several years ago that it wanted to move to a new location because it has grown and needs more space.
Several other regional government agencies, including the Bay Area Air Quality Management District, the Association of Bay Area Governments and the Bay Conservation and Development Commission, joined the MTC in searching for a building that could accommodate all of their space needs.
The air district plans to join the MTC when it moves into the building at 390 Main St. in San Francisco in the fall of 2013 but the other agencies haven't yet made a final decision.