REPORT/RECOMMENDATION TO THE BOARD OF SUPERVISORS
OF SAN BERNARDINO COUNTY
AND RECORD OF ACTION
November 17, 2026
FROM
TERRY W. THOMPSON, Director, Real Estate Services Department
ARLENE MOLINA, Director, Preschool Services Department
SUBJECT
Title
Amendment to Lease Agreement with First Evangelical Lutheran Church for Classroom and Office Space, Playground Area, Shared Gymnasium Space, Land, and Parking Spaces in Fontana
End
RECOMMENDATION(S)
Recommendation
1. Find that approval of Amendment No. 4 to Lease Agreement No. 06-234 with First Evangelical Lutheran Church for Classroom and Office Space, Playground Area, Shared Gymnasium Space, Land, and Parking Spaces, is an exempt project under the California Environmental Quality Act Guidelines, Section 15301 - Existing Facilities (Class 1).
2. Approve Amendment No. 4 to Lease Agreement No. 06-234 with First Evangelical Lutheran Church, utilizing an alternative procedure pursuant to County Policy 12-02 - Leasing Privately Owned Real Property for County Use, to:
a. Extend the term of Lease Agreement No. 06-234 by five years, from January 1, 2027 through December 31, 2031.
b. Adjust the rental rate schedule and certain utility costs.
c. Add three additional five-year options to extend the lease agreement term.
d. Continue leasing approximately 9,008 square feet of classroom and office space, approximately 35,355 square feet of playground area, shared use of approximately 3,880 square feet of gymnasium space, approximately 5,300 square feet of land for a 720 square foot modular unit, and 30 parking spaces at 9315 Citrus Avenue (Assessor’s Parcel Number 0193-171-01-0000) in Fontana, for the Preschool Services Department.
e. Increase the total lease amount by $769,032, from $1,805,169 to a new total amount of $2,574,201.
3. Direct the Real Estate Services Department to file the Notice of Exemption in accordance with the California Environmental Quality Act.
(Presenter: Terry W. Thompson, Director, 387-5000)
Body
COUNTY AND CHIEF EXECUTIVE OFFICER GOALS & OBJECTIVES
Operate in a Fiscally-Responsible and Business-Like Manner.
Provide for the Safety, Health and Social Service Needs of County Residents.
FINANCIAL IMPACT
Approval of this item will not result in the use of Discretionary General Funding (Net County Cost). Preschool Services Department (PSD) lease costs are 84% federally funded and 16% state funded. The total cost of Amendment No. 4 (Amendment) to Lease Agreement No. 06-234 (Lease) with First Evangelical Lutheran Church is $769,032. Lease payments will be made from the Real Estate Services Department (RESD) Rents budget (7810001000) and reimbursed from PSD’s budget (5911612220). Other costs associated with the Lease include interior electricity, the County’s pro-rata share of water and trash services, certain sewer fees, and janitorial costs, which will be paid from the PSD budget. These costs are separate from the $769,032 in base rental payments associated with the Amendment. Sufficient appropriation is included in the 2026-27 budgets and will be included in future recommended budgets. Annual Lease costs are as follows:
|
Year |
Lease Cost |
Estimated Other Lease Cost |
|
January 1, 2027 - December 31, 2027 |
$144,852 |
$105,056 |
|
January 1, 2028 - December 31, 2028 |
$149,196 |
$108,208 |
|
January 1, 2029 - December 31, 2029 |
$153,672 |
$111,455 |
|
January 1, 2030 - December 31, 2030 |
$158,280 |
$114,799 |
|
January 1, 2031 - December 31, 2031 |
$163,032 |
$118,243 |
|
Total Cost |
$769,032 |
$557,761 |
BACKGROUND INFORMATION
The recommended action will amend the Lease with First Evangelical Lutheran Church (Church) to extend the term of the Lease for five years, for the period of January 1, 2027 through December 31, 2031, and add three five-year options to extend the term of the Lease for the continued use of approximately 9,008 square feet of classroom and office space, approximately 35,355 square feet of playground area, shared use of approximately 3,880 square feet of gymnasium space, approximately 5,300 square feet of land for a 720 square foot modular unit, and 30 parking spaces at 9315 Citrus Avenue (Assessor’s Parcel Number 0193-171-01-0000) in Fontana (Premises). The Lease extension is necessary due to PSD’s continued need for the facility to provide services in the Fontana area.
On March 21, 2006 (Item No. 32), the Board of Supervisors (Board) approved the Lease with the Church for an initial term of 10 years, with two five-year options to extend. The original Lease term commenced on April 1, 2006 and expired on March 31, 2016.
During the approximately 20 years since the Lease was originally approved, the Board has approved three amendments that extended the Lease term, modified the rental rate schedule and utility costs, increased the size of the Premises, added 10 additional parking spaces for a total of 30, and provided additional options to extend the term.
|
Amendment No. |
Approval Date |
Item No. |
|
1 |
November 18, 2008 |
54 |
|
2 |
March 22, 2016 |
66 |
|
3 |
December 14, 2021 |
53 |
PSD has requested that RESD process an amendment to continue its occupancy of the facility beyond the current Lease expiration of December 31, 2026. The proposed Amendment will extend the Lease for an additional five-year term, from January 1, 2027 through December 31, 2031, and provide the County with three additional five-year options to extend the term. All other terms and conditions of the Lease will remain unchanged.
The project to approve the Amendment was reviewed pursuant to the California Environmental Quality Act (CEQA) and determined to be categorically exempt under Section 15301 - Class 1 Existing Facilities because the proposed Lease will secure property to operate within the existing structure with negligible or no expansion of existing use.
County Policy 12-02 provides that the Board may approve the use of an alternative procedure in lieu of a Formal Request for Proposal (RFP) process whenever the Board determines that compliance with the Formal RFP requirements would unreasonably interfere with the financial or programmatic needs of the County, or when the use of an alternative procedure would otherwise be in the best interest of the County.
The use of an alternative procedure is recommended to support PSD's continued operations at the existing facility, which has served its programs since 2006. Extending the Lease will allow PSD to maintain uninterrupted services while avoiding potential relocation costs, facility improvements, and operational disruptions associated with securing an alternative location. Additionally, RESD's market survey indicates that the proposed rental rate is competitive with comparable properties in the surrounding market. Based on these considerations, the alternative procedure is recommended as being in the County's best interest.
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Summary of Lease Terms |
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Lessor: |
First Evangelical Lutheran Church Jane Herrera, Board President |
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Location: |
9315 Citrus Avenue, Fontana (Assessor’s Parcel Number 0193-171-01-0000) |
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Size: |
Approximately 9,008 square feet of classroom and office space, approximately 35,355 square feet of playground area, shared use of approximately 3,880 square feet of gymnasium space, approximately 5,300 square feet of land for a 720 square foot modular unit, and 30 parking spaces |
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Term: |
Five years; January 1, 2027 through December 31, 2031 |
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Options: |
Three five-year options |
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Rent: |
Cost per square foot per month: $1.34* modified gross |
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Monthly: $12,071 |
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Annual: $144,852 |
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*Mid-range for comparable facilities in the Fontana area per the competitive set analysis on file with RESD |
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Annual Increases: |
Approximately 3% |
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Holdover: |
Upon the same terms and conditions, including rent, as existed and prevailed at the time of the expiration of the term |
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Improvement Costs: |
None |
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Custodial: |
Provided by County |
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Maintenance: |
Provided by Lessor |
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Utilities: |
To be provided by Lessor, subject to County reimbursement for electric, pro-rata water and trash services, and janitorial costs for interior space, and certain sewer fees |
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Insurance: |
The Certificate of Liability Insurance, as required by the Lease, is on file with RESD |
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Right to Terminate: |
County may terminate the Lease with 90 days’ notice |
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Parking: |
Sufficient for County needs |
PROCUREMENT
Not applicable.
REVIEW BY OTHERS
This item has been reviewed by County Counsel (Josiah Houck, Deputy County Counsel, 387-5455) on November 4, 2026; Preschool Services (Arlene Molina, Director, 383-2028) on October 27, 2026; Purchasing (Dylan Newton, Buyer III, 665-4793) on October 27, 2026; and County Finance and Administration (Allegra Pajot, 387-4351, and Eduardo Mora, 387-4375, Administrative Analysts) on October 29, 2026.
(AH: 840-266-8977)