The Menlo Park Fire Protection District will soon become a landlord.
On May 15, the district’s board voted unanimously to hire a property management firm to rent out a home — purchased by the district in March for $3.2 million — on the open market.
District Chief Harold Schapelhouman had earlier asked the board to consider renting the house to a fire district employee for a $3,000-per-month salary reduction, but he told the board that the two district employees who had expressed interest in renting the home are no longer interested.
The board also voted to charge the federal government’s Urban Search and Rescue Task Force $10,000 a month to rent approximately 10,000 square feet of space in a warehouse the district purchased in 2017 for $5 million. The district has begun to move into the warehouse and has budgeted $500,000 to making improvements in it.
The task force is currently paying $4,115 monthly to rent warehouse space from Facebook in Menlo Park, but the space will no longer be available because Facebook plans to develop the property.
Schapelhouman had also asked the board to consider renting out the three-bedroom, two-bathroom house at 2110 Valparaiso Ave., next door to the district’s Alameda de las Pulgas fire station, to the town of Atherton. The town has recently been looking for a place for police officers and dispatchers to sleep between 12-hour shifts.
The relationship between Atherton and the fire district has been strained at times during the past several years, since the town began closely examining how much in tax revenue from the town’s property owners goes to the fire district and how much the district spends providing service to the town. After a consultant’s report showed town taxpayers were contributing nearly twice what their services cost, Atherton asked for further study of options for separating from the fire district.
However, said Schapelhouman, “I’m sympathetic toward law enforcement’s conundrum.”
“Let’s not lose sight of the fact that we’re public safety partners,” he said. “Out on the street we all work together, and we work for the same people.”
Board member Peter Carpenter, who has been one of the biggest critics of Atherton, said there is nothing to prevent the town from renting the house at fair market value.
The board had originally considered the chief’s proposal to rent the house to a district employee in March, but asked for a lot more information before making a decision. After the meeting, the district received some negative feedback about the idea.
“I think we crossed the bridge of using this for any public employee purposes,” Carpenter said. “Given what we felt was the heat, the scrutiny, et cetera, et cetera, et cetera, we weren’t going to do that.
“Having made that decision, I think the only responsible thing for us to do is say, ‘OK, until we need the property for expansion of Station 4, we’ll rent it out at fair market value.'”
The house had been listed by its previous owners for lease at $6,000 per month when the district began negotiating for its purchase. The owners had listed it six months earlier for $7,400 a month. Schapelhouman said the property manager the district has been talking to says he can rent it for between $5,000 and $6,000 a month.
Nino Gaetano with Pacific Union International has offered to manage the property for $325 a month, the chief’s report says.
While public entities such as the fire district do not have to pay property taxes on their property, they do have to pay a different tax, called possessory interest tax, if renting it out for nongovernmental purposes. Schapelhouman’s report said the district would pay the possessory interest tax of about $2,680 a month.
