MX’d message

Those Alamedans who would like to see the City require that every new “mixed-use” development project provide more “workforce” housing and reserve more space for job-creating businesses will have longer to wait – maybe a lot longer.

For months, Councilman Frank Matarrese has been trying to get his colleagues to write mandates on these subjects into law.  Finally, at the June 6 Council meeting, staff presented a draft resolution reflecting Mr. Matarrese’s intent – and Council rejected it by a 3-to-2 vote, with only Mayor Trish Spencer joining Mr. Matarrese in favor.

Proponents of workforce housing may get a second bite at the apple in September, when staff will present its recommendation for changes in the inclusionary housing ordinance that covers all new development projects, not just those on land zoned MX.  But the split between commercial uses and residential development will continue to be determined on a project-by-project basis by staff, the Planning Board, and ultimately the majority of the five Council members in office when the project comes up for approval.

If that prospect – especially the last part of it – gives you pause, you’re not alone.

Mr. Matarrese’s quest – we hesitate to call it a crusade – began in January 2016 when he submitted a Council referral proposing to re-write the City’s mixed-use zoning ordinance “in order to aid retention of beneficial commercial uses within areas zoned for mixed use.”  Among other things, the referral asked Council to consider “establish[ing] proportions of commercial use to residential use” and “retaining or increasing jobs in areas zoned for mixed use.”

The referral did not mention any specific project, but it was no accident that virtually every one of the nearly two dozen citizens who spoke in favor of the referral talked about the Alameda Marina, for which a developer had just floated a plan to replace existing maritime businesses with high-density housing.  If Council changed the mixed-use zoning ordinance along the lines suggested in the referral, this plan might never see the light of day.  Or so the speakers apparently hoped.

In response to the referral, Council agreed to “provide direction” to staff at its April 19 meeting, but then ended up adjourning the session without having taken a vote because the clock was nearing 11 p.m.  Mr. Matarrese promptly submitted another referral renewing the original one.  (Around the same time, he also offered a referral for amending the inclusionary housing ordinance to increase the required percentage of “affordable” housing in every new residential development – and to add a new requirement that every project also include “workforce” housing.)

Four months and five Council meetings passed without either referral being heard.  Finally, on November 1, 2016, Council decided to schedule a “workshop” on mixed-use zoning (and a separate workshop on inclusionary housing).  After another six months and 13 meetings, the mixed-use “workshop” made it onto Council’s June 6 calendar.  (The inclusionary housing workshop will take place in September.)

After January 2016, when Mr. Matarrese made the original referral, the developer of the Alameda Marina site submitted a draft master plan for a mixed-use project with 670 new housing units and a maximum of 250,000 square feet of commercial use.  In addition, since then mixed-use developments have been proposed for the MX-zoned sites located at:

  • Encinal Terminals (589 new housing units and 30,000-to-50,000 square feet of commercial/office use);
  • The Alameda Landing waterfront (375 new housing units and 25,000 square feet of retail/office use); and
  • Shipways (292 new housing units and no commercial use).

(For reference, the Safeway store at Alameda Landing occupies 45,000 square feet all by itself.)  When Council finally took up Mr. Matarrese’s referral on June 6, it thus had the opportunity to establish a policy that would affect four major pending projects along the northern waterfront.

Assistant Community Development Director Andrew Thomas made it easy for the Council members to act by providing them with a draft resolution that, if adopted, would impose specific requirements for non-residential use and workforce housing for every mixed-use project.  Under the resolution,

  • If a mixed-use development is planned for a site with existing businesses, it must not “result in a net loss of jobs in the plan area over the life of the proposed plan.” If there are no existing businesses on the site, the “acreage of land devoted to commercial purposes, maritime uses, and public open space should not be less than the amount of land devoted to residential uses.”
  • In addition to meeting the requirements set by the City’s Housing Element and inclusionary housing ordinance for “very low,” “low,” and “moderate” income households, the development must “design” at least 10 percent of the “market-rate units” to be affordable to households earning between 120% and 180% of the area median income.

In drafting the resolution, Mr. Thomas said, staff had “tried to articulate what we had heard [from Council] into objectives and standards that are not currently in the MX zoning district legislation.”  Council had made “very clear” that commercial and maritime development as well as job retention and creation were “extremely important,” and staff kept those goals in mind as it reviewed development proposals.  “Your policies and your direction already have influenced the shaping” of the pending mixed-use proposals, Mr. Thomas told the Council members.

Unfortunately, the politicians seized upon Mr. Thomas’s remarks as an excuse for dismissing the proposed resolution as superfluous.  As Vice Mayor Malia Vella put it, “If Council already is giving instruction on some of this, and it’s already taking place, do we have to codify it in a way to make it real?  It seems like we’re already getting the output that we want.”  Council members Marilyn Ezzy Ashcraft and Jim Oddie leapt on the bandwagon, and the triumvirate – which is quickly becoming the latter-day incarnation of the Gilmore-Bonta-Tam bloc that controlled Council between 2010 and 2012 – voted the resolution down.

Since Council never reached the merits, it fell to the public speakers to address the specific requirements proposed by resolution.  Two commenters focused on the stated exception to the proportionality rule:  the 50/50 split between residential and non-residential could be waived “if it is determined that the additional residential land is necessary to fund the site and infrastructure improvements needed to support the public open space and/or employment areas.”  This exception, the commenters argued, could swallow the rule.  In any event, the new law should create procedures for deciding whether additional housing in fact is essential; the City shouldn’t just take the developer’s word for it.

The proposed proportionality rule raised a couple of other issues.  Some of the northern waterfront projects now in the pipeline include “submerged” as well as dry land in their acreage totals.  How, if it all, should uses on the water – e.g., a marina – be counted in determining whether the mix of uses in the project is appropriate?  (Mr. Thomas told us that the Encinal Terminals project would pass the 50/50 test if water uses were counted but would not if they weren’t.)  Likewise, many of the projects include so-called “housing over retail” with, e.g., a shop on the ground floor and several stories of apartments above it.  How should such a building be counted – retail, residential, or both?

More fundamentally, the proposed resolution treated all non-residential uses – commercial, maritime, and open space – as one category for purposes of applying the proportionality rule.  This would seem to allow a developer to meet the 50/50 test by devoting half of the project to only one of those uses – and the rest to residential.   Imagine a project – and this, of course, is strictly hypothetical – where the developer – we’ll call him “Tim” – leaves half of the acreage as open space and builds a bunch of 14-story apartment buildings on the other half.  He’d comply with the resolution as drafted – even though the project wouldn’t create a single new job.

Moreover, the proposed resolution dealt with each project on a stand-alone basis.  But both the Alameda Landing waterfront project and the Shipways project represent the last piece of a larger master plan (the Bayport/Alameda Landing plan and the Marina Village plan, respectively).  Should those projects and their proposed uses be evaluated in isolation – or in the context of the overall scheme (which may have been approved years ago)?  If the latter, it could be argued that, given the 787 housing units already approved for Bayport/Alameda Landing (most of which have been built), no additional residential development should take place on the waterfront.  By the same token, given the predominantly commercial character of the existing Marina Village development, a housing-only project might seem entirely fitting for the Shipways site.  And if, like Planning Board member Ron Curtis, one wants to take an even broader view, maybe the uses proposed for a particular project should be judged against the aggregate of uses for all projects along the northern waterfront.

Yet these are all policy or drafting issues that, if it wanted to, Council could resolve (with the assistance, of course, of Mr. Thomas and City Attorney Janet Kern).  From where we sit, there is a lot to be said for writing specific requirements for all mixed-use developments into the zoning ordinance rather than asking staff or the Planning Board to apply Council’s “objectives” on a project-by-project  basis.   (And yes, Mr. Oddie and Ms. Ashcraft, we are suggesting that “one size fits all” – as your law school professors might have told you, that’s what a “law” does.)

For one thing, as much as we respect Mr. Thomas, he cannot force a developer to comply with a requirement that isn’t on the books.  Should a developer propose a project that fails to contain the percentages of affordable housing set forth in the inclusionary housing ordinance, planning staff can show her the door.  But if the developer proposes a project that doesn’t reserve 10 percent of its housing for units affordable by middle-income households, planning staff can’t reject it simply because it doesn’t meet Council’s “objectives.”

Moreover, absent a resolution or ordinance passed by Council, the City planners face the unenviable task of discerning those “objectives” from statements made at Council meetings.  That’s not easy with any group of elected officials – and especially not with this one.  We’re sure we can find sound bites from everyone now sitting on the dais – even Ms. Ashcraft and Mr. Oddie (and maybe Ms. Vella) – endorsing the goal of “preserving a working waterfront.”  But at the same time, the Council members routinely bemoan the “housing crisis” and vow to fix it.  Which Council “objective” is staff supposed to prioritize when it reviews a mixed-use development proposal?

And even if staff is able to discern a consensus among the sitting Council members about a particular “objective,” it may turn out to be ephemeral.  The collective view, if one exists, is likely to change as the composition of Council changes:  replace Tony Daysog with Malia Vella and the pro-housing voices suddenly become the loudest on the dais.  Indeed, with the current Council, it may be too much to expect consistency even from the same Councilman.  Recent events have shown that it doesn’t take an epiphany to cause one of our Council members to change his views virtually overnight; a threat of retribution at the polls will do the trick.

For all these reasons, we tend to agree with Mr. Matarrese’s comment:  “It’s fine to have a verbal direction.  But if it ain’t written, it doesn’t count.”

As it happened, Monday’s Planning Board meeting offered the public a chance to see how the current ad hoc system is working.  For proponents of commercial development, the verdict is equivocal at best.

First up on the agenda was an item asking the Board to recommend an amendment to the Bayport/Alameda Landing master plan to conform it to the latest proposal for the waterfront site.  Both Mr. Thomas and Sean Whiskeman, the spokesman for the developer (Catellus), portrayed the most recent plan as reflecting goals espoused by City officials, and, in fact, the uses proposed for the site had changed.  The original “framework” presented in May 2016 called for 375 new housing units, 15,000 square feet of retail use, and 10,000 square feet of office use – and no maritime use.  Since then, Mr. Whiskeman told the Planning Board, “we heard you loud and clear, we heard about your interest in expanding the commercial, we heard about expanding maritime,” and Catellus responded by increasing the “maritime commercial” portion of the project to 364,000 square feet.  (The latest plan also includes 5,000 square feet of “ground floor commercial” space.)

As it turns out, the reason that the “maritime commercial” component expanded so dramatically is that Catellus has entered into a contract to sell 18.3 acres on the west side of the site to Bay Ship & Yacht, which intends, for the time being, to retain the existing warehouses located there.  According to Bay Ship’s Leslie Cameron, the firm plans to keep one existing tenant and to seek new ones, including “displaced maritime companies currently needing to leave Alameda Marina.”  Which means that, if one takes the larger view, the net gain to “maritime commercial” uses along the northern waterfront will be hard to measure.  In addition, one wonders whether Catellus would have “heard” the Planning Board so clearly if it had not been able to cut what presumably is a mutually lucrative deal with Bay Ship & Yacht.  Nevertheless, the fact remains that the latest proposal does include far more space for commercial enterprises than the original one did.

The next agenda item involved Alameda Marina.  All staff was asking was for authorization to re-issue the Notice of Preparation for the EIR, but since the reason for the request was a revision to the draft master plan, the project as a whole became the topic of discussion.  The change occurred after a three-person subcommittee consisting of Board members Kristoffer Koster, David Mitchell, and John Knox White approved an increase in the residential portion of the project from 670 to 760 units.  In so doing, they accepted the developer’s contention that more housing was needed to finance the changes in the rest of the project requested by the subcommittee, such as preserving the “graving dock” to “create a more unique [sic] project design.”

The revised plan may have pleased the members of the subcommittee, but others on the Planning Board, and the majority of the public speakers, were less than ecstatic.  Among other things, the new plan reduced the commercial space from 250,000 square feet (which included 115,000 square feet for maritime use) to 153,000 square feet (which included 75,000 square feet for “maritime commercial” use).  In addition, Liz Taylor, owner of DOER Marine, one of the Marina’s best-known businesses, reported that current long-term tenants, including her own company, were “being pushed out now,” even before a final plan had been approved.  (Apparently, the developer saw the need to make room for more housing – or for a different sort of tenant.)  Other speakers criticized the smaller size of the boat yard and the lower number of dry-storage spaces.

Lorre Zuppan, perhaps the Board’s least ideological member, summed up the public reaction to the new plan this way:

The whole reason we agreed to allow [multi-family residential] development on this site was to preserve the working waterfront and the marina here, not to destroy it. . . .  From the community input process . . . I’m hearing that this plan is not there yet. . . .  We’re not even close, from what I’ve heard tonight.

Mr. Thomas then suggested initiating another “process” that would start with a “peer review” of the developer’s infrastructure cost estimate.  The Board agreed.

Would a decision on the fate of the Alameda Marina be any closer if Council had accepted Mr. Matarrese’s idea and adopted specific requirements for mixed-use projects?  We don’t know – but we’re pretty sure the public would have been spared a lot of frustration.  And we won’t be surprised if, when Mr. Matarrese runs for mayor, he reminds voters how he tried to convince his colleagues to set standards rather than merely “provide direction” and the Big Three brushed him off.

Sources:

Mixed-use workshop: 2017-06-06 staff report re MX zoning2017-06-06 draft Resolution

Alameda Landing: 2016-05-23 staff report to PB2016-05-23 Ex. 1 to staff report to PB – Site Plans and Illustrations2017-06-12 staff report re master plan amendment2017-06-12 Ex. 1 to staff report to PB – Proposed Master Plan Amendment text2017-06-12 Ex. 2 to staff report to PB – Environmental Assessment

Alameda Marina: 2016-11-14 Ex. 3 to staff report to PB – Notice of Preparation (NOP)2017-06-12 staff report to PB2017-06-12 Ex. 1 to staff report to PB – Revised Plans; 2017-06-12 Ex. 2 to staff report to PB – Revised Notice of Preparation

 

About Robert Sullwold

Partner, Sullwold & Hughes Specializes in investment litigation
This entry was posted in City Council, Development, Housing and tagged , , , , , , , , , , , , . Bookmark the permalink.

4 Responses to MX’d message

  1. Steve Gerstle says:

    We have a city council to pass laws,not to give directions. If we don’t have the rule of law, then we have the rule of individuals and political winds can quickly change directions. All sorts of garbage can get sucked into a power vacuum.

  2. Dennis Evanosky says:

    I always enjoy riding on your Merry-Go Round. Sure you can’t do a shorter version for the Sun?

  3. Robert. Great information here. It appears that it may be time to move away from the island and find a place that has greater interest in the residents vs. the power and process of being re-elected?

  4. Linda Soulages says:

    As always Robert your blogs are filled with imformative imformation and very respectful. I’m with Dennis a column in the Sun would go a long way. Thank you for your resurch and the time you take for each and everyone of your topics.

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