Ron Cowan once stood atop the world. He owned a mansion in Tiburon, commuted to work in his own helicopter, and helped many of his politician friends win elections. In Alameda, he was nothing short of a legend. He built 3,000 homes, constructed a 350-acre office park, and had a road named after him. But five years ago, his fortunes hit bottom when he defaulted on $43.1 million in loans and lost most of his business park. Cowan was down, but not out. He still owned twelve acres of the park and was determined to make money.
For the past three years, the developer has attempted to recoup some of his losses with a plan to build 104 market-rate houses on his remaining land, not far from Oakland International Airport. But Alameda city officials have indicated that if they approve the project, Cowan would also have to construct affordable housing as required under the city's "inclusionary" housing law. Building housing for poor people, however, would cut into his profits, so instead he sued the city last month in Alameda County Superior Court.
In the 34-page lawsuit, Cowan's company, Harbor Bay Isle Associates, accuses the city of holding its plans "hostage in order to force HBIA to agree to the city's position" that it must build affordable homes or pay to construct them elsewhere in Alameda. As a result, the suit asks the court to block the city's demands. Cowan maintains that the city awarded him the right to build more market-rate homes back in 1989, fifteen years before it adopted the inclusionary housing law.
Alameda Assistant City Attorney Donna Mooney refused to comment on the suit, saying her office needed to "digest and evaluate" it. But some city officials and other businesses said they are more concerned about the location of Cowan's project than the affordable housing issue. City Councilman Doug DeHaan noted that its proximity to the airport could reignite a battle with the Port of Oakland over noise. He also said Peet's Coffee and Tea, a recent addition to the office park, has expressed doubts about having homes next to its new $17 million headquarters and roasting plant. "There are concerns that the residential housing that he's proposing doesn't fit," DeHaan said. "It's in a business park."
Cowan's attorney, Stephen Cassidy, did not return a phone call seeking comment, but Cowan has successfully used litigation to extract concessions from Alameda in the past. He sued the city in the 1970s and '80s while erecting 2,973 homes in what is now known as Harbor Bay Isle. Each time, the litigation resulted in settlements that allowed his plans to move forward. In the current case, Cowan wants the city to rezone his twelve acres as residential and exempt him from building homes for the poor.
It should be interesting to see whether Alameda Mayor Beverly Johnson urges another favorable settlement for Cowan. After all, he helped her win election in 2002. Johnson also did not return a phone call seeking comment, but campaign finance records show that in 2002, Cowan donated $25,000 to Californians for Neighborhood Preservation, a political committee that papered Alameda with mailers supporting her mayoral candidacy.
Kim's Hit List
State schools Administrator Kimberly Statham last week continued her purge of her predecessor's top lieutenants with the firing of Javetta Robinson, chief financial officer of the district. Statham's decision to can Robinson, who was handpicked by former Administrator Randy Ward to stabilize the Oakland schools' finances, had cruel twists that left district insiders shocked, afraid, and bewildered.
According to two knowledgeable district sources, state Superintendent Jack O'Connell might not have picked Statham as Ward's replacement were it not for Robinson's input. Last August, Robinson, who is well regarded among school officials statewide for her financial acumen, gave Statham a glowing reference, helping convince O'Connell that she was right for the job. "She probably wouldn't have got it without Javetta," one of the sources said.
Not only did Statham fire the woman who helped her, she didn't even have the guts to do it herself. The two sources said that Statham dispatched district counsel Roy Combs to deliver the bad news on Combs' last day on the job prior to retirement. "It was his last act of official business," the source said.
Through a spokesman, Statham refused to comment, citing "personnel" reasons. But according to one source, Combs did not provide Robinson with a reason for the dismissal. Some insiders said they believed Statham felt threatened by Robinson, who is known for being blunt and candid. For example, she regularly questioned whether Oakland Unified, which still owes the state $86 million of a $100 million loan, could afford to pay for novel programs. "We've spent millions of dollars on people who have come in here to make spreadsheets and charts that now just sit on the shelf somewhere," one of the sources said.
Robinson has not yet left she's staying for a short transition period. But her departure will leave Oakland schools without a competent financial manager. Earlier this year, district budget director Barak Ben-Gal, also hired by Ward, left in frustration and took a job with Yahoo. According to a Wall Street Journal article last month, Ben-Gal was fed up with the district's culture of incompetence. "There were people in accounting [who] didn't know the difference between a debit and a credit," the Journal quoted him as saying.
Robinson had worked with Ward in Compton schools before coming to Oakland in 2004; she was the second of Ward's top deputies to be fired by Statham in the past ten months. Last September, Statham fired Katrina Scott-George, one of the architects of the school district's reform efforts, also without giving a reason. Statham also felt threatened by Scott-George, who has since filed suit against the district, demanding her job back (see Full Disclosure, 6/13).
Earlier this week, the state returned limited control of the district to the Oakland school board. But now, thanks to Statham, who is not a budget expert, it's an open question as to who will ensure the district won't get in financial trouble again.
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