Eminent domain the last hurdle for San Jose

I want to point out something before we begin. Whether it’s this story or the quotes from Susan Slusser’s articles, let’s remember that none of it are statements from the A’s, MLB, or San Jose. As close as they seem to the situation, there’s a lot of conflicting information out there so take all of this with multiple grains of salt.

It’s always been there, lingering in the background. I even wrote about it only six weeks ago. It’s the boogeyman. It’s eminent domain. A frequent commenter has the gory details:

I was at a bachelor party in San Diego this past weekend. A San Jose city council member was part of the group and we discussed the A’s in detail.

What he told me was this:

1. ATT is being a “pain in the ass” and will not move unless forced to by eminent domain. Even re-zoning the land for ATT in West San Jose did not help the cause at all. In fact the city council in hindsight would have never agreed to it had they known ATT would still refuse to leave.

2. The city will not use eminent domain on ATT unless MLB gives the OK that the A’s can move to San Jose. Therefore this is not a “race” between OAK and SJ. San Jose like Oakland is in a holding pattern waiting for MLB to make a decision…..Two cities, same boat.
He told me that they cannot “justify” using eminent domain on ATT without MLB approval to move forward.

3. He stated to me their RDA is pretty much done and he “implied” to me Wolff will have to buy the last 2 parcels himself but would not out right say it when I tried to question him more on it. The city council knows full well that Wolff will pay for it because everyone knows it is a “drop in the ocean” of the overall cost of the stadium. He also mentioned SJ unlike most cities did not misuse their RDA funds and used it for several successful developments across the city.

4. He agrees with me Lew Wolff has some kind of “backdoor” deal with Selig as being a former lawyer he does not understand Wolff’s patience with the situation. The city has brought up an anti-trust lawsuit to Wolff and he has told the city “not to sue” and to let the process play out despite San Jose having an excellent case in anti-trust court, which he agreed with me is “solid”.

5. Without Wolff supporting an anti-trust lawsuit San Jose is stuck in mud and he is very pessimistic the A’s to San Jose will ever occur. Although he is still holding out some hope.

6. He also agreed San Jose is getting the “best ballpark deal” of any city in history of MLB. The city is not paying for anything outside of what they have so far. Diridon will be re-developed regardless of the ball park but not for several years to come. BART or High Speed rail would have to be within 3-5 years of being in San Jose.

I wanted to share this info with everyone as this is first hand info from a SJ city council member that is as recent as yesterday.

AT&T owns the largest remaining property within the Diridon site. Its reluctance to sell will force San Jose to use eminent domain to acquire AT&T’s land (and possibly one other piece) in order to complete the site. There is no way to build a ballpark without the AT&T land.

AT&T land is in blue. Most of the rest has either been acquired or is no longer part of the planned site.

Even though Lew Wolff has expressed a willingness and confidence in the ability to acquire all of the ballpark site, not having a willing seller creates a big time hitch. San Jose can’t force AT&T and the A’s to negotiate on land. Instead, San Jose can acquire the land, then negotiate on the relocation and replacement land costs, then have the A’s reimburse the City. Making things more complicated is the fact that public-to-private exchanges tend to be politically unpopular. That may cause a final step in which the A’s buy the land, then convey it back to San Jose for free so that the site (and maybe the ballpark) are publicly owned. The Quakes stadium site is a publicly owned “island” surrounded by Quakes-owned land. Wolff indicated there are numerous ways this could play out, and these are just a couple different permutations.

Adding to the complications is the still lingering fate of redevelopment, which won’t be decided until January. Right now no agency is allowed to buy anything even though the state Supreme Court granted RDAs a six month stay to operate. San Jose is trying to bypass this roadblock by moving assets to its San Jose Diridon Development Authority, a redevelopment wing thinly disguised as a joint powers body. Keep in mind that San Jose has not made its ransom payment to keep its barebones redevelopment group running, choosing instead to sue Governor Jerry Brown over the new redevelopment laws. For that matter neither has Oakland, and Oakland could require eminent domain on multiple landowners to clear Victory Court.

Despite this major hurdle, all we’ve heard over the last week is a growing confidence in public statements by both Wolff and Billy Beane, indicating Sid’s item #4 may well be in play. If that’s the case, here’s how I see this playing out:

  1. Wolff gets green light during November owners meetings.
  2. San Jose seizes upon this and makes one last offer to AT&T before the end of the year. If AT&T continues to holdout, City notifies that it will start the eminent domain process via SJDDA.
  3. City can’t actually start eminent domain without a referendum, so if it’s required a special election will be held during the early spring (with MLB picking up part of the tab).
  4. City procedes to acquire the land and begin relocation, which should take 3-6 months to complete.
  5. Demolition and site clearing would have to be done throughout the summer and fall of 2012.
  6. Groundbreaking happens in November or December 2012.

It’s important to note that there’s always that final offer. Eminent domain is every bit as much a threat as it is a tool and may be used simply to bring parties to the table. AT&T knows that San Jose is hamstrung by the referendum requirement and other political realities, so it may be playing its own special brand of hardball. A supposed quid pro quo deal between City and AT&T over rezoning an old work site near Santana Row may have been AT&T playing City like a fiddle. The Death Star of telecom is no stranger to strongarm tactics. This is the company that thinks eliminating a wireless carrier by acquiring it will actually bring more competition to the industry.

FWIW, I’ve been consistent in my feeling that no one in the South Bay camp has the stomach for a lengthy antitrust challenge to MLB. As for the “best ballpark deal”, with the A’s on track to pay for everything ($450 million ballpark and up to $100 million in land and improvements), yes, it would be better than the deal for AT&T Park and any other MLB ballpark deal in the last century.

61 Responses to Eminent domain the last hurdle for San Jose

  1. Sid says:

    @Tony- San Jose is so far ahead of Oakland it isn’t even funny. You are correct on that.

    Your wrong on the land acquisitions as San Jose will not moved forward despite what you want to believe is true or not.

    ATT is going to hold out since they see MLB has not ruled therefore why move unless they have to? If SJ gets the go ahead then the situation changes.

    ATT is smart with their thinking as they have made it clear they do not want to move.

  2. pjk says:

    …I almost switched to ATT Uverse last year. Glad I didn’t. Might be time to switch a cell phone account away from them, too.

  3. Genaro says:

    TonyD, the thing is that the Baer decision has to be approved relatively sooner than Wolff/Fisher/SJ resolving the ATT parcel. It could be that it’s part of the SJ package that’s approved in November or it could be the last thread for the Giants to fight.

  4. Genaro says:

    Sid, ML has commented and used the former city attorney’s comments that ED will require a referendum.

  5. Tony D. says:

    SJ city attorney could always issue another opinion regarding E.D. and a referendum. Its not etched in stone as is SJ Muni Code. Sid, you do have a point: why make a genuine move for AT&T parcel if you haven’t heard from MLB yet. However, even without a ballpark, development would be slated for that parcel anyway (Diridon station development). The city is going to have to acquire the land anyway, E.D. or straight up purchase. Perhaps we’re making to big a deal of the final parcels.

  6. bartleby says:

    @Nathan “Half of the Bay Area would be 22nd, just behind St. Louis and above Portland.”
    .
    The issue is, the A’s won’t get half the Bay Area in Oakland. They might get half the Bay Area in San Jose, especially if you’re measuring it by revenue.
    .
    Keeping the team in Oakland gives about 4 million people convenient access to two ballparks, and 2.5 million people convenient access to zero. This is not a logical way to try to maximize attendance. Putting the team in San Jose, however, gives 7 million people convenient access to a ballpark.
    .
    The bigger issue though is the location of the corporate base, about half of which is in the South Bay and most of the rest of which is in San Francisco. The A’s would be lucky to get 10% of that market in Oakland, because they are hellishly inconvenient to the rest.
    .
    In light of all this, San Antonio starts looking pretty attractive, especially if they threw some public money in.

  7. jk-usa says:

    @bartleby–”Putting the team in San Jose, however, gives 7 million people convenient access to a ballpark.”
    Convenient? Huh? Tell to that the east and north bay fans. The A’s will have to make the most of those 2.5 mill in the SB, if god forbid, SJ is their final destination.

  8. jk-usa says:

    Disregard previous post. I mis-read it. At first it sounded like SJ would give convenient access to the whole 7 mill bay area population, but after re-reading it, its a ballpark in SF and SJ would do that. My bad.

  9. Sid says:

    @Tony- You are correct they will eventually need the ATT parcels regardless of the ballpark. Without the stadium though it will be years before they acquire it just for the Diridon renovation as the HSR and BART are much further way than if a ballpark came to down.

    @Genaro- I did read why ML posted. I simply stated it “may not be needed” since Federal Law supersedes local and state law. It just depends how the city goes about it with ATT. Since ED would be used for a ballpark it “may be” possible. Although ML could be 100% right but at the same time a referendum is needed anyways to donate the land to the A’s. So they might just kill 2 birds with one stone anyways.

    @bartleby- I am with your statements 100%. MLB is not maximizing this market at all hence why its a “wash” via revenue sharing. If MLB was placing 2 teams in the Bay Area today and 2 stadiums were to be built from scratch you would put them in San Francisco and San Jose, not Oakland for the reasons you stated that it would give greater access to more people in the market.

    That is why the Giants arguments are so flawed. People in Santa Clara, Monterey, and Santa Cruz counties would be able to attend games far more in San Jose than in SF/Oak. Right now MLB is ignoring 2.5M people and a huge corporate base….unbelievable this is even possible.

  10. mainea'sguy says:

    I think the Giants issues with the A’s to SJ go beyond the corporate base and 2.5 million people in the South Bay. I think they’re more worried (legitimately, I suspect) that eventually a significant percentage of their Peninsula fanbase could be siphoned off by the A’s. SJ is easy to get to from most of the Peninsula, afterall, unlike Oakland. Not saying they should win the argument, just that I think that is an underlying reason for their stubburn stance on T rights.

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