Here's the pitch: Oakland mayor Jerry Brown wants to build housing in Oakland's uptown area; City Manager Robert Bobb wants to build a new ballpark for the A's. The disagreement has led to an uncharacteristically public clash between Bobb and Brown, complete with a bizarre mayoral gag order on his erstwhile enforcers. The issue also divides the city council, which is set to vote next week on whether to renew a no-bid contract with an urban housing developer that has contributed generously to the mayor's political interests. The result is an odd game of chicken involving one of the city's most notorious parcels of land. One side has warned that without a new ballpark the A's might leave town, while the other insists that a hard-won housing deal might evaporate if the developer doesn't get an exclusive negotiating agreement next week.
Though geographically desirable, the neighborhood bounded by 18th and 20th streets, San Pablo Avenue, and Broadway has nevertheless languished for the better part of three decades. A succession of mayors has faced mounting public pressure to do something with it, but the city has never been able to stick with a master plan, even though almost everyone agrees that the uptown needs a makeover. Former mayor Elihu Harris once envisioned it as an entertainment zone crowned by a refurbished Fox Theater. Planners later reconceived the area as a shopping district anchored by a department store. Thanks in part to the mayor's push to entice ten thousand new and mostly upscale residents to the downtown area, the city's recent focus has been on building about a thousand apartments on what is now mostly a grid of crumbling parking lots. And now there's the ballpark idea. "We never know what we want, and when people do come up with some proposals, we always say we want something bigger," sighs District 2 Councilmember Danny Wan.
When it comes to a possible ballpark, the A's won't yet comment, and the ink is hardly dry on their recent Coliseum lease extension. The mayor says the absence of a bid from the baseball team gives him the willies, saying that the team prefers an even more expensive location, the waterfront Howard Terminal, which would cost an estimated $517 million to build. In the meantime, Brown warns that pursuing an elusive ballpark deal might scuttle the very real housing plan. "The chances of the stadium happening are very unclear, but not the chances of it killing the development downtown one more time when it's happened three times over the last quarter of a century," says Brown. "I'm looking at dead dirt at the end of my term as mayor unless the Forest City project comes forward."
But even negotiations with Brown's favored developer, Forest City Residential West, have been subject to fluctuation. Over the last four years, the Cleveland-based developer has signed two previous exclusive agreements with the city, each calling for a different housing and retail mix on the uptown site, and each of which was allowed to expire. Oakland even once put talks with Forest City on a six-month hiatus while it carried out top-secret talks with Sun Microsystems, hoping the uptown might host a corporate campus.
Forest City's most recent set of preliminary plans, which were released this July, called for an eight-hundred-unit gated community and a reduced retail component. Although the developer will not comment publicly on its proposal, one week before the council vote it was still being tweaked. Forest City quickly axed the universally reviled gate, and proposes to boost the number of units to a thousand, while adding enough new units to house a thousand UC Berkeley students. Twenty percent of the units would be set aside for renters earning fifty percent of the area's median income.
The city council remains divided, although a majority seems to lean in favor of the Forest City plan. The last time the council voted on Forest City's exclusive negotiating agreement, it split 5-3 with Henry Chang, Ignacio De La Fuente, Moses Mayne, Nancy Nadel, and Danny Wan in favor, and Jane Brunner, Larry Reid, and Dick Spees opposing it. As the council prepares to vote, Spees has put forth a motion that would allow the city to pursue negotiations with the A's without violating its exclusive negotiating agreement with Forest City, leading to speculation that the council might ask Forest City to work up a hybrid plan that would include a ballpark and housing.
Although housing advocates are happy to see new apartment construction, especially a high-density plan with an affordable housing component, it's not easy for them to like Forest City's plan. They worry that the high level of proposed subsidies make Oakland's projected $51 million investment far too steep. The city normally pays no more than forty percent of affordable housing construction. According to the preliminary July plans, Forest City was asking for about 96 percent, a whopping subsidy of $225,000 per unit, and expects an unusually high 12 percent return on its investment. Skeptics worry that the Forest City deal would swallow up several years' worth of funds for other redevelopment projects.
Dan Vanderpriem, redevelopment manager for Oakland's Community and Economic Development Agency, says that when you break it down, the $51 million price tag is not as imposing as it seems. "The $51 million number is the entire cash flow that the agency needs to do everything having to do with uptown," he says. "It's not a check that's written to Forest City." According to Vanderpriem, that figure includes $2 million for public improvements such as sidewalks and streetlights, a $12 million subsidy for affordable housing, and the $8 million difference between the land's market value and what it will cost for the city to rehabilitate it and relocate pre-existing businesses. Altogether, he says, the subsidy pocketed by Forest City would actually be closer to $26 million.
But Forest City also is asking for a giant tax break in addition to hefty subsidies. In many redevelopment areas, certain property taxes are handed over to the city's redevelopment agency for revitalization projects; by state law, twenty percent of those funds must go to affordable housing. Brown has encouraged the building of market-rate developments by noting that the higher tax revenues would ultimately be used to build affordable housing. But Forest City's current plan asks for an exemption from paying these taxes, which Elissa Dennis of East Bay Housing Organizations says defeats the whole purpose of allowing market-rate development. "They're letting these guys off the hook," Dennis says. "It's just hypocrisy; it's classic trickle-down mentality."
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