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Your City Council Report
For July 27, 2010
By Katy (ADQ) Miessner
DOWNTOWN PART I
We can forget all our troubles, forget all our cares and go
Council approved unanimously a loan agreement of $1.16 million to Domus Development, to support their proposal to convert the historic Masonic Temple (built in 1917) and the old (1872) Vallejo Municipal building, next to each other on Marin between Virginia and Jeffry Alley into affordable artists’ lofts (“Temple Art Lofts”). Yes, yes people are already saying: how can a bankrupt city be giving loans to developers? These complainants obviously have not read Paul Norberg’s excellent article “Fund Accounting for Dummies” here on VIB. It’s our General Fund that’s bankrupt, not the Housing and Redevelopment Funds to be used for this project. Why there are so many pots of money that have so many restrictions is a different story—that’s another discussion which requires a white paper. In the meantime, the City of Vallejo has very stringent legal obligations on how they can spend these funds which are clearly designated for affordable housing. But, since these funds are considered “local matching”, using them could bring in the State and Federal dollars that require local matching funds, increasing what we already have. So, cleverly, the City of Vallejo—also required to create 8 more units of very low income housing to satisfy the last bit of the Buchongo Settlement—has partnered with Domus to rehab the Masonic Temple for affordable artists’ lofts, which also meets the Buchongo settlement. The Temple which some may remember as the host to the 2003’s “Bad Gas Ball” (LNG Plant opponents’ victory party)—is now in such disrepair: copper wire all gone, birds nesting inside, a stream of water running through the basement, needs to be retrofitted. Everyone agrees that rehab of this historic building requires such a huge investment that it would never happen as a market rate project, and that likely without this proposal the Temple would have to be bulldozed (or left to disintegrate; Who has the cash to bulldoze?).
For those interested in the Buchongo Settlement, court documents posted on the City’s website show that a lawsuit was filed on June 17, 1996. A “significant dispute” exists between the City of Vallejo and the Plaintiffs, Munto Buchongo, Jerald Holcomb and James Thurlo. I assume the plaintiffs sued Vallejo because had the City not misused (allegedly) funds, but rather used them properly to develop low income housing, Buchongo et al would have been eligible for this housing.
The dispute—as inferred in the document—is that the City of Vallejo improperly used Southeast Vallejo Redevelopment Project (Glen Cove/Home Acres) Funds that were required for “housing production requirements” among other things, instead for improvements to Benicia Road (“validity of past expenditures for Benicia Road”).
Oops.
The end result is that even though the City denies any malfeasance, they did agree to produce more affordable housing. And thus created Sereno Transit Village and Avian Glen Apartments--the City has produced all but 8 of the 425 units required by the settlement.
No one wants more affordable housing in the downtown, but there is willingness to make an exception if these units truly are for responsible working artists and their families. There weren’t any objections from the public last night. But there is concern—understandably—that somehow the artist requirements will be circumvented by some.
Meea Kaang, the Principal from Domus, reassured council that the law allows the City to establish tenant selection criteria, or preference, and applicants will be required to produce a portfolio and proof of income. She said that “in our world, we have more applicants than units and gainfully employed, working artists will rise to the top.”
The project is not fully funded—there is a gap of about $1.16 million on a $12.9 million project. And in the worst case scenario—if the gap of funds isn’t filled—the City would have to foreclose on the property and they would still be required to develop affordable housing elsewhere. Kaang expressed confidence that the needed additional funding would eventually be secured, and that her company has a 100% success rate in getting the most competitive funds in the state. She stressed that in a perfect world, all the funds would be identified up front, but Domus has positioned the project to attract federal dollars. And they already successfully negotiated the asking price for the buildings down from $3 million to the current $half-million.
Mayor Davis expressed worries about the parking. Here in the ‘burbs, we are so used to having a parking space right outside the businesses we drive to. And why do we always have parking spaces right out front of businesses? Because businesses don’t have enough customers. A parking problem would be a good thing.
If all works out—escrow closes August 30—Domus could start work as soon as next year. Plans include a first floor with an arts and music café and possible space for arts programs to help replace those cut from public schools. Quoting Kaang, the building lends itself to a creative space. I personally think this is an excellent catalyst for the downtown—affordable artists’ spaces that are truly appointed with all the niceties (i.e. not just a cold warehouse in a bad part of town, like the space I used to rent in SF) are simply at a premium and I bet the demand will be huge.
DOWNTOWN PART II
Downtown Where the folks are broke. Downtown Where your life's a joke. Downtown When you buy your token, you go Home to skid row.
What was expected to be a quiet, boring little item had the top blown off it. In a “joint meeting of the Vallejo City Council and Vallejo Redevelopment Agency” (all the same people), city staff presented the RDA 5-Year Housing and Redevelopment Implementation Plan.
Osby Davis looked as if he was laying pterodactyl egg. City staff—especially Craig Whittom—tried to dance gingerly around and not step in the middle of the big doo-doo made by the recent contract termination with downtown developer Triad. But it was impossible to sidestep under the perceptive questioning by Councilmember Brown. She started off by asking why—(when the list of major programs implemented in last 5 years included the Triad Agreement for Downtown Development)—was there no mention of Triad for the next five years? Annette Taylor answered that the city has terminated. Assistant City Manager Whittom stated that Triad’s agreement was terminated because they were not meeting their goals and objectives.
Brown went on to compare the City’s relationship with Callahan DaSilva (CDS), the Waterfront developers. Their Development and Disposition Agreement (DDA) was signed well in advance of Triad and yet the CDS agreement hasn’t been terminated (and may I point out that Lennar on Mare Island, here in Vallejo the longest of the three, still has their agreement intact). She went on to point out that CDS’s DDA has been around longer but their work is still anticipated in the next five years – and asked has CDS been meeting their performance objectives?
Craig Whittom explained that CDS has until 2011 to meet objectives, but doesn’t believe that CDS will even be able to by then, and he expects this to come back to the council in a few months (for an extension?!?). In his dance, he explained that certain pieces of the waterfront are underway, the mapping, transfer, Georgia Street improvements and other certain elements, which Brown reminded him were all City projects—and she asked, does CDS have any money in the Vallejo transfer Station or Parking Garage? To which Whittom had to answer, “NO.”
Callahan DaSilva’s DDA was signed in 1999, and Brown asked if at the time it was signed, was 2011 their deadline, to which clearly the answer was NO, but Whittom attempted to justify the several amendments given to CDS extension by pointing out delays in entitlements and the CEQA action (The Waterfront Coalition lawsuit). And of course the obvious retort from Brown was, why did the City not do the same thing with Tria and amend Triad’s DDA?
Osby Davis, getting hotter under the collar at this point brought up the Triad lawsuit and asked if the Council should be discussing the issue—brought up concerns that what Brown was saying could support Triad in litigation.
Brown went on to point out that the plan did not explain how termination of the Triad agreement would meet the goals and objectives listed on page 9 to which Whittom answered that the termination was based on Triad’s “lack of performance.” And Brown said she could not see literally how this could even meet the goals and objectives, to which Whittom again brought up the termination based on “lack of performance.” Brown asked, oh, so CDS has been meeting goals and objectives and Triad hasn’t? Whittom again tried to point to public projects and attempted to dance around the issue some more with no clear or satisfactory answers. Methinks something squishy between Whittom's toes ?
The discussion ended with Brown asserting that she did not agree with many of Whittom’s remarks and that there are a number of vague sections in the plan. She stated that because these redevelopment areas are blighted, the City needs to work as hard as we can, and that the current plan and past plans don’t meet up with goals and objectives – but instead are filled with inconsistencies.
We, the public, will never know exactly why Triad’s agreement was terminated and “not meeting performance standards” doesn’t make sense in light of the same charge that could be brought against other developers with currently intact if decrepit agreements.
But let’s not forget that Mayor Osby Davis was Callahan DaSilva’s legal representative as he led an “Astroturf” group in support of the CDS Waterfront Plan, during the time the Vallejo Waterfront Coalition (VWC) was shopping around an alternative. Did Osby Davis push for termination because he has a grudge against Triad—since “we” supported the downtown development and not the waterfront? Does he think the Triad plan is supported by—egads—gay people? At one point one of the Astroturf people “accused” the Waterfront Coalition of being made up of gay people which I heard second-hand, but I did hear first-hand, Osby Davis’ apology for his colleague’s remark when he came down to the Waterfront Coalition booth at the Farmers' Market.
Or maybe he knows of someone waiting in the wings to take over the downtown now that Triad has invested time and energy to create the downtown plan and design guidelines? Or maybe he’s envious that, once the VWC filed a lawsuit, he was out of the picture when the big legal guns were brought in. Whatever the reason, it makes no sense from the outside looking in that the City would not agree to work with Triad, especially now while the market is down along with costs. Now’s the time to develop and be ready for when the market turns around.
Brown stated after the meeting, it isn’t fair that the City is treating developers differently. CDS has been in Vallejo 3-4 times longer than Triad and they have been able to renegotiate and Triad has not. Instead, Triad’s agreement was summarily terminated.
Triad spent $10 million on the Environmental Impact Report, the Design Guidelines, the Specific Plan and they orchestrated a transparent public process—while in contrast CDS fought the public every step of the way. I served on Triad’s Downtown Advisory Group (DAG) and was impressed by the experts brought in to develop the plan, including Ken Kay Associates. It’s my opinion that the public—especially those who served on the DAG—needs an answer why Triad was terminated, better than “they didn’t meet performance measures” . The fact is, no one else has either.
“FLOSDEN” AND JETSAM
Councilmember Brown wasn’t quite done with her questioning. She brought up the fairgrounds portion of the Flosden Redevelopment area and pointed out that the County will get sales tax money from their agreement before the City sees any money back. And that seemed to contradict the stated goal for Flosden which is to increase tax revenue – revenues will be a long way off because the county gets theirs first. And that the 460K square feet of mixed use at the fairgrounds contradicts the stated goal to diversify our economic base since it's more retail.
Whittom responded that the sales tax issue remains to be seen because agreements have not yet been negotiated, and the retail would be a regional “destination” (please read the excellent article posted on VIB that busts the myth of “destination retail”) which currently doesn’t exist in Vallejo and so wouldn’t compete with Vallejo’s other retail centers. He also brought up other diversification efforts – a sports field, exhibition center, and a “water feature” (how a water feature generates revenue is beyond me – water feature reminds me of the water fountain at UNPlaza where I used to work. On a windy day, it had to be shut off because one did not want to be sprayed by the urine-filled fountain water, if you know what I mean.
FLOTSAM AND JETSAM
Mostly Flotsam The Council gave City Staff permission to negotiate with Recology (formerly known as Vallejo Garbage Services). Recology was given an astounding 30-year lease with a 10% profit margin built in (reminds me of the 50-year leases Vallejo used to hand out at $1 year). The contract expires in 2017 and Recology wants to renegotiate and extend it. We know about contract extensions here in Vallejo, now don’t we? Recology seems to be using a little bit of extortion: the Garbage fund is underfunded by $2.7 million, which means a 13% rate hike to our garbage bills. Recology wants to renegotiate to bring this down, and in return, extend the contract. But with this “cost-plus” contract, there is absolutely no incentive for Recology to reduce costs; they just pass it all along to us rate payers. It really is an untenable situation, but since this item was merely to give permission to talk to Recology, it was passed unanimously. Council members expressed concern that the City should go out to bid, especially in light that anecdotally at least, Vallejo pays a lot more than the surrounding cities. An email from a former Vacaville resident, now in Vallejo, stated that Vallejo’s rates are 2 times more than Vacaville for the exact same service. Of course, if the City negotiates with Recology, we have to pay for a lawyer. Councilmember Schivley asked if there was any way of breaking the current contract, with Gary Leach responding that Recology would have to be in breach of their contract. To which Brown quipped: “outrageous rates don’t count as defaults?”
JETSAM – consent calendar community forum.
Erlinda Gunn & Gerri Spearman of the Summerset Highlands neighborhood spoke on Item A (the item where Council encourages The School District and GVRD to work together in swapping land for development the Hiddenbrooke Park, which is already fully funded).
They spoke on this issue because they want the same support from council for Regents Park as Hiddenbrooke received for their park.
While I completely agree that it is not fair for Summerset Highlands to have lost access to Regents Park for an undetermined amount of time, the Hiddenbrooke Park issue has a completely different set of circumstances. The Summerset Highlands neighborhood collected signatures to block the Bordoni Ranch housing development (I helped collect a few). They succeeded in getting enough signatures, and were able to force Braddock and Logan (B&L) the developers of Bordoni Ranch, and the City of Vallejo, to settle, with concessions that the neighborhood was satisfied enough with to allow the development to move forward. It was agreed that Regents Park would be fenced off and the playgrounds removed so B&L could use it as staging and for access to their property. Then the housing market crashed and Bordoni development came to a screeching halt. But not before the park was blocked off and now weeds are growing at a dangerously high fire hazard level. The speakers asked that the weeds be mowed and the fence be taken down for the time being while there is no activity at Bordoni Ranch. A little different than the land swap at Hiddenbrooke, but certainly not an unreasonable request to ask that the City put pressure on the developers.
MORE JETSAM– community forum.
Jim Fisher of the Battleship Iowa Group expressed his concern that Vallejo could lose the opportunity to berth the battleship; the Navy has reopened the bidding and San Pedro wants it. The problem is that the City and Lennar have shown no commitment to finding an alternate berth now that ship-scrapping is approved. Fisher asked Council to support the Iowa in getting a berth.
Uptown downtown or out to sea, it seems like the city just can't make up it's mind. Maybe that's part of the problem. |
