Special Notice / Hearing: None
Vote Required: 4/5ths
To: Honorable Board of Supervisors
From: Ann M. Stillman, Director of Public Works
Subject: 795 Skyway Road Building Replacement Project [County Project No. AS033]
RECOMMENDATION:
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Recommendation to:
A) Adopt a resolution:
1. Authorizing the County Executive Officer to execute a Financing Agreement with the Airports Division of the Department of Public Works to authorize financing in the amount of $5,500,000 for the 795 Skyway Road Building Replacement Project at the San Carlos Airport, and to make non-substantive additions, clarifications, and other changes as the County Executive Officer deems necessary or advisable after consultation with the County Attorney; and
2. Authorizing the President of the Board to execute an agreement with SC Builders, Inc. for demolition and construction of the 795 Skyway Road Building Replacement Project, in the amount of $10,340,000; and
3. Authorizing the Director of Public Works to:
a) Execute subsequent change orders to grant time extensions for project completion and payment up to a maximum aggregate amount not to exceed $1,034,000, or approximately 10 percent of the agreement amount; and
b) Approve payment up to the not-to-exceed amount of $11,374,000 for items requiring adjustment based on unit bid prices without execution of a change order; and
c) File a Notice of Exemption for a California Environmental Quality Act Categorical Exemption.
B) Approve an Appropriation Transfer Request (ATR) to appropriate revenue and expenditures in the Department of Public Works in the amount of $5,500,000, to fund the 795 Skyway Building Replacement Project.
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BACKGROUND:
On January 27, 2026, this Board adopted Resolution No. 081664, which adopted plans and specifications, including conformance with prevailing wage scale requirements and calling for sealed bids for demolition and construction of the 795 Skyway Road Building Replacement Project (Project) at the San Carlos Airport. The Airports Division of the Department of Public Works (Department) ensures the safe and efficient operation and maintenance of the two County-operated Airports: San Carlos and Half Moon Bay.
The Project was originally designed in 2019 and was delayed due to the COVID-19 pandemic. The Project will demolish and replace the existing 795 Skyway Road Building which has far exceeded its useful life and presents ongoing safety and code compliance issues. The building currently houses flight schools displaced by the 2019 Skyway Center development, located on private property adjacent to the San Carlos Airport. These long-standing airport businesses are essential to preserving small-aircraft flight training at San Carlos Airport.
The Project will construct an all-electric 12,592 square foot building with five office suites, ADA-compliant restrooms, and 1,820 square feet of meeting space which will be available for use by airport users, County staff, and the local community. Upon completion of the Project, the five office suites will be leased to aviation service providers at fair market value in accordance with Federal Aviation Administration (FAA) regulations. Demand for aviation office space and meeting space at San Carlos Airport remains high, and this Project directly supports continued economic activity, small-aircraft flight training, aviation sector workforce development, youth science, technology, engineering, aviation, and mathematics (STEAM) education, scholarship programs, and public engagement.
DISCUSSION:
On Monday, March 2, 2026, bids were accepted for the Project and subsequently referred to the Department for checking and recommendation. Based on the review of the bids submitted, the Department finds the proposed cost for the items of work to be reasonable and recommend award in the amount of $10,340,000 to SC Builders, Inc. in accordance with the conditions of award contained in the Contract Documents.
The bid of:
SC Builders, Inc.
910 Thompson Place Sunnyvale, CA 94085
at $10,340,000 was the lowest responsible bid received for the work. The Engineer’s Estimate was $11,400,000. A summary of the bids received is attached as Exhibit “A”.
The FAA issued a Categorical Exclusion to the National Environmental Policy Act (NEPA) for the Project. Department staff has determined that the Project qualifies for a Categorical Exemption pursuant to Section 15301(d) of the California Environmental Quality Act (CEQA) Guidelines for Implementation, which provides that rehabilitation of deteriorated or damaged structures or facilities to meet current standards of public health and safety is exempt from review. Upon approval of the resolution the Department will file a Notice of Exemption for a CEQA Categorical Exemption for this Project.
The County Attorney has reviewed and approved the resolution and ATR as to form.
COMMUNITY IMPACT:
The Project will deliver long-term benefits to San Carlos Airport users and the larger community by supporting essential aviation services, expanding access to meeting space, and reinforcing the airport’s role as an educational and economic resource. The Project also advances sustainability, strengthens local businesses and aviation sector workforce development, and creates new opportunities for public engagement, ensuring that San Carlos Airport remains a valued community asset for years to come.
FISCAL IMPACT:
The total estimated cost (including permitting, inspections, construction management, engineering support, and construction) for the Project is $12,500,000. The Project is planned to be financed with $3,500,000 from the Airport Enterprise Fund, $3,500,000 in Measure K Jet Fuel Tax revenue, and $5,500,000 is proposed to be financed by the General Fund. Funding from the Airport Enterprise Fund and Measure K Jet Fuel Tax is already included in the FY 2025-26 Adopted Budget.
The proposed Financing Agreement includes the provision of $5,500,000 from the General Fund to be repaid over a 15-year term at an interest rate equal to the County investment pool interest earnings. Repayment will begin approximately two years after the financing is provided to allow sufficient time to complete the Project and lease the new office suites and will be made with revenue generated from the newly constructed Project.