Category Archives: Politics
The other day Wendy Thurm asked me if there was a page of links and material related to Coliseum City that she could check out. There wasn’t, so I took some time to create one. The result is a curated, reverse chronologically-ordered list of posts, with a brief overview of the project. The link is simple enough:
There’s a new link in the sidebar as well, so you can reference it after this post disappears. Eventually I’ll do the same for other sites, but it will take awhile.
It’s been awhile. Today’s unusual joint meeting of the Oakland City Council and the Alameda County Board of Supervisors was the first such joint session in several years. It’s also been more than a couple of years since I wrote a post titled The adult conversation, which implored Oakland (and Alameda County) to start talking about what it will truly take to keep the pro sports franchises in town, and what it might mean to lose one or more of them. After watching today’s proceedings, I can say that we’ve had our first session, one of many to come.
If you were an unabashed supporter of Coliseum City, things didn’t get off on the right foot as AlCo District 5 Supervisor and Board President Keith Carson demanded to know the state of the Coliseum’s outstanding debt. Oakland City Council President Pat Kernighan tried to reel the discussion back in, but Carson insisted, and eventually he got what he wanted – a plain telling of debt for both the stadium ($113,790,000) and arena ($90,290,000) by County Auditor Pat O’Connell, who also happens to be the JPA’s auditor. That’s $200 million combined for the complex, though that figure goes down every year thanks to a $20 million annual debt and operating subsidy paid by City and County. Carson emphasized that there will be no future project if debt isn’t addressed first. The debt may prove to be a structural problem, since whatever public borrowing has to be made for infrastructure or other uses will be on top of or consolidated with the existing debt. The City and County want the teams or the private development group, BayIG, to cover that debt as part of the plan. Incidentally, Carson’s district covers Berkeley, Albany, and much of Oakland.
The debt talk lingered for 10 minutes, then Kernighan got the discussion back on the rails. Assistant City Administrator Fred Blackwell gave an overview of the current situation, with the renewed leases for the Raiders and A’s, their desires, and the Warriors’ plans. Blackwell said that the funding gap for the Raiders stadium, which he called a “sunken cost,” was $400-500 million after the Raiders’ contribution. AlCo Supe Scott Haggerty cast doubt on the viability of the three venue configuration of Coliseum City, noting that so far only the Raiders have been willing to listen. Haggerty suggested that the most effort should be put towards the Raiders’ venue because of that reality, and that the A’s, who don’t even have a set date for their Phase III ballpark, could easily show that information to MLB and say, “we’re not even on the radar.” CM Desley Brooks, a previous JPA Board member, expressed doubt in a different way, citing the need for multi-use venues instead of single-sport venues. Brooks was also concerned that the project wouldn’t pencil out, asking for a pro forma for that configuration (and others, presumably).
Next up in the presentation were two members of Oakland’s Office of Neighborhood Investment, Larry Gallegos and Gregory Hunter. Gallegos gave more detail about the project’s phases and master plan. Due to the photocopied quality of the images, I skipped over this slide initially. Upon closer inspection, something needs to be explained further.
The top image, Phase I, shows an outdoor football stadium, some ancillary development, and outlines for the “spine” of the project and the ballpark. The next image shows a dome on top of the stadium and the spine in place. Hold the phone – is the dome part of Phase II? There’s no other mention of a dome anywhere else in the presentation, nor was it brought up during today’s session. That dome, assuming that it is part of Phase II, is no trivial matter at $300 million to construct. Oakland Mayor Jean Quan has been pushing for a dome, and while the interest in holding conventions and other types of events is understandable, it seems like this rather important detail was merely snuck into the preso with no explanation whatsoever.
Discussion then centered on the phases and once again, the venue configuration. Blackwell admitted that if only the Raiders’ stadium were built, ancillary development potential may be limited as few examples of such a plan were found. The limited number of football game dates contributes to this problem. CM Rebecca Kaplan, a staunch supporter of Coliseum City, talked up the need for more density within the project as that’s where the payoff is. Of course, that brings to mind the question of whether Coliseum City is even feasible if it never goes past Phase I. In addition, how dependent is the project on Phases II and III to provide enough funding for everything? Those questions won’t be answered until the spring.
Mayor Quan repeated her usual hackneyed sports metaphor and pushed for more information. If that’s the case, why did this meeting occur because of a letter from Carson to the City of Oakland? Quan, who hastily made her remarks before heading to the airport, is supposed to be the champion of this project. Yet Kaplan is clearly the more informed, more passionate advocate. Someone desperately needs to grab this thing by the reins and control it, as it’s considerably late for all this confusion given the very tight timeline imposed on the City and County. CM Libby Schaaf was silent during the session, just hours after she filed papers to run against Quan for mayor in 2014.
Hunter talked about the goals and key elements of the project, one of which is the property transfer element. It’s unclear what that means. City has indicated in the past that it’s not willing to give away land, and may not even be interested in selling land. Unfortunately for them, the only valuable resource the JPA has at its disposal is land. Discussion of this topic was deferred to the DDA, though it will clearly become a hot topic before then.
Members of the public spoke, followed by questions and remarks by members of the City Council and Board of Supervisors. General bewilderment gave way to soapbox speeches. CM Larry Reid, already on the outs with the JPA, claimed that Quan took credit for his concept while calling Coliseum City “insane.” Supe and JPA board president Nate Miley asked if there had been an appraisal on land the JPA owns. Hunter said it wasn’t. Miley expressed frustration that developer BayIG hasn’t put down earnest money to kickstart some of these studies. Blackwell said that only recently the agreement was finalized in which BayIG (Colony Capital & HayaH Holdings) replaced Forest City as the investor group. Miley then dropped a mini bombshell when he asked if the City could buy out the County’s half of the JPA. Blackwell laughed it off, replying that the City didn’t have the resources to pull off such a move. Nevertheless, it’s quite telling that Miley could even suggest that the Coliseum is such an albatross that the County would be fine divesting its share. There’s also a situation in which the County could buy the City’s half. Judging from the across-the-board sentiments from the Supes, that seems even less likely.
- District 2 Supe Richard Valle: “Gifting of public funds to any franchise is not part of my political framework.”
- There was continued confusion over Howard Terminal. Blackwell mentioned that the Port of Oakland has to explore all possible maritime uses before moving to non-maritime uses like a ballpark. That would explain why a recent RFP for Howard Terminal makes no mention of a ballpark.
- There was no discussion about how long the teams would be displaced or where they would play if Coliseum City came to fruition.
- Blackwell mentioned that the market study, which is key to determining the project’s feasibility, would be delayed 30 days.
- I tweeted that the football stadium deal could come by the end of the 2014 NFL season, but that seems like a long ways away considering the amount of work that has to be done.
- Brooks got in a shot when she said that leverage had “walked out the door” when the new lease extensions were approved.
As the first substantive meeting of this kind for Coliseum City, it was bound to be at times painful and awkward, and it sure delivered. That’s part of the process and a welcome one, because there’s no way in hell this thing moves forward without much greater detail. Everyone on the dais was keenly aware of the political fallout that could occur with a bad deal. The Board of Supervisors felt that Oakland was leading and dragging them into the deal, which brought about Carson’s letter and this session. There was a general consensus that communication about the project has been poor. Right now there’s a lot of skepticism to go around, most of it healthy. Project proponents have every opportunity to whip up sentiment and numbers to back their claims of renaissance and jobs. As long as the numbers are there, Coliseum City has a fighting chance. If it doesn’t pencil out, that information and the new short-term leases will conspire to make MLB’s and NFL’s decisions easy. And they’ll make today’s recriminations look like a civil dinner party.
The City of Anaheim is poised to give away development rights for virtually all of the land surrounding Angels Stadium in exchange for two simple things: the team staying in Anaheim, and the city no longer having to pay to maintain the old stadium. Is that too much to give? We’re about to find out in Orange County, and the same could be said in Oakland, where Colony Capital is being asked to provide hundreds of millions to bridge a funding gap at Coliseum City.
How big a funding gap? It depends on the scope of the project. Planning aspects of Coliseum City will be shown in presentation Monday to the Alameda County Board of Supervisors and the Oakland City Council for discussion and a vote. The session will be held at 1:30 PM, which means that there probably won’t be many members of the public on hand.
Initially, the football stadium would be built along with needed infrastructure to support future development. Included would be transportation improvements, which indicates to me that they’re counting on the transit funding that was narrowly voted down in 2012. Stadium capacity remains within a broad range, and there’s no indication of whether it will have a retractable or fixed dome.
Phase II looks relatively modest, as it includes a lot of housing and limited retail (40,000 square feet). By comparison, Bay Street Emeryville has 382,000 square feet of retail and 400 housing units. It would commence in 2019, the year following the completion of the Raiders’ stadium. Also included would be a 220-room, 3.5 star hotel, signifying a mainstream brand such as Sheraton, Hilton, etc.
The final phase is most aggressive, as it likely anticipates a boom sufficient enough to make Phase III buildout feasible. Along with the ballpark there would be over 15,000 parking spaces (presumably in garages), an “Upscale” hotel, much more retail space, and nearly a million square feet of office towers. At any point one or more of these components could be removed or scaled back, which is often the case in such large projects. Since the A’s haven’t signed on with the project in any capacity, there’s no date for the ballpark’s opening. Also not included is the replacement arena, which is technically part of Area B from a planning standpoint (the focal Area A is the Coliseum and land east of 880).
We’ve covered the complexity of Coliseum City as a development project in the past. The presentation works to delineate the many issues. Compared to the DDA of the 49ers stadium in Santa Clara, Coliseum City is several orders of magnitude more complex. The big X factor is the $100+ million in remaining debt on Mt. Davis, which Mayor Quan and the City Council have said has to be baked into the new deal. There will be some sort land sale agreement that will invite scrutiny, as that’s a major key for the cost assessment for Colony Capital. Colony has some limited experience in the football realm, having recently partnered with the Chargers on their stalled (or failed depending on who you ask) plans in Downtown San Diego. This is an important framework from which many important questions about Coliseum City will be answered. Better late than never.
Lost in all the owners’ meetings, MVP awards and other sports news was a little story out of Sacramento. It involves a stadium for a second-tier soccer team – that will be built in five months.
That’s right, five months. And it was only announced today. The stadium will have a capacity of 8,000 and be constructed on a parking lot at Cal Expo for the Sacramento Republic soccer club. The Republic is aiming to become a future expansion team in MLS. By building this 8,000-seat facility (nearly the size of Buck Shaw Stadium), the hope is that MLS will be impressed enough to grant the franchise’s “promotion”, leading to a deal for a larger MLS stadium in a few years. The neat trick to the deal is that the club is partnering with Cal Expo’s concessionaire to build the stadium, a potential win-win for both parties.
How could all of this come together in only five months? The stadium is considered temporary. When we envision stadium projects, we usually see the dark side of environmental review because these structures are meant to last for 30-40 years or longer. However, if you build a temporary facility, you can largely sidestep CEQA law. After all, the point of CEQA is to understand and mitigate against long-term environmental impacts, so if you can prove that your project won’t have a huge impact, you may be able to get a CEQA exception. One of those exceptions is for temporary or seasonal structures. They’re planning to put in the stadium, which will only be used 15-20 times per year during a 6-7 month window, and take it apart when the new stadium is ready. Project proponents can argue that there’s little impact since the stadium site is already a parking lot. Stretching the definition of temporary to nine years in this case is a little suspect, but there isn’t a hard and fast definition to use. Here’s what the law says:
15304. Minor Alterations to Land
(e) Minor temporary use of land having negligible or no permanent effects on the environment, including carnivals, sales of Christmas trees, etc;
Similar exceptions are available for additions to existing structures, such as the musical chairs situation I described last month. It would involve temporary additions to Raley Field and San Jose Municipal Stadium. A tougher case could even be made for a larger, 20,000-seat ballpark in San Jose. Let’s say that there’s some currently undeveloped or underutilized but properly entitled land somewhere within San Jose city limits. It could be publicly or privately owned. If the A’s struck a deal with the landowner, they could get permitted to build a temporary ballpark on that land. Sites could include the Airport West site near the Earthquakes stadium (though we’ve seen the difficulty building there), the County Fairgrounds, or other privately owned land. There are even sites near downtown.
That said, we’re at a late enough stage that it’s practically impossible to pull off a temporary new ballpark in time for the 2014 season. Expanding Raley would make more sense in that timeframe. As transient the whole thing sounds, it’s definitely a path of relatively little bureaucratic resistance as long as you get willing partners. Since it wouldn’t involve public money, a referendum wouldn’t be required.
… it’s Major League Baseball.
The fallout started early this morning, when KTVU reached out to the A’s to get their reaction to MLB’s threat to move the A’s to AT&T Park.
That was followed by AP sports scribe Janie McCauley reporting something similar, but without the weaselly-sounding “intend to” in it. Included was a statement from the Coliseum Authority (JPA):
“We are working on a deal that we believe will be beneficial for both our tenant and the people of this community,” the statement said. “We are confident that everyone involved sees the value in continuing for as long as possible the 45-year relationship between the A’s and the City of Oakland. While we cannot comment on the specific issues now under discussion or on whether there is any basis to recent rumors that Major League Baseball has played a role in the discussions, we are optimistic that a final deal is close at hand.”
Later, BANG’s Matthew Artz dug deeper, picking up more sentiment from East Bay pols.
Sources with knowledge of the Coliseum authority’s private deliberations Friday said there was movement toward softening its stance that the A’s relinquish control over concessions and signage revenue at O.co Coliseum, which comes at the expense of the Raiders.
“The key point is that the authority wants the A’s to stay in Oakland and is not willing to risk losing them over that issue,” said one source privy to the discussions.
Then Mark Purdy got into the JPA’s thinking in holding out over the extension:
Naturally, the A’s balked at the Coliseum’s original terms for a longer lease. Miley and his fellow board members reportedly held firm, believing that the A’s had no other options but to play at O.co in 2014. And at that point, MLB voices tossed out the concept of the A’s playing temporarily at AT&T Park until a new ballpark project could be developed elsewhere.
Also, don’t forget that the JPA hasn’t exactly shown a lot of urgency on behalf of the A’s. Consider what JPA board member and Oakland City Councilmember Rebecca Kaplan said a month ago:
And the six- to eight-year window should give Oakland plenty of time to get serious about building a replacement ballpark and luring the A’s to stay, Kaplan said.
You have to think that Selig’s threat action was motivated by this rather cavalier attitude towards the A’s.
It certainly appears that all that remains is for the A’s and JPA to make certain compromises and finalize the terms. One of the chief issues will be the $3 million in parking fees the A’s owe the JPA. A good compromise would be for the A’s to pay that money, which the JPA would turn around and use for the belated scoreboard revamp and other capital improvements. And the A’s should get that flexibility they’re seeking.
Concessions revenue is another matter. The A’s could retain control with their own cut of each beer or hot dog (this was originally negotiated when the A’s settled a lawsuit with the JPA after Mt. Davis was built). But how would the Raiders and Mark Davis react? Unlike the A’s, who are continuously profitable, the Raiders frequently flirt with the red – a seemingly impossible feat given the NFL’s extensive revenue sharing and TV contracts. Much of that is due to cap mismanagement during the Al Davis era. Some of that is attributable to lacking stadium revenues, especially concessions. It seems unlikely that Mark Davis will bolt just because of maintaining the status quo, but he could also choose to build a case for leaving based on this. He and the NFL have been pushing the JPA on the Raiders’ own extension, Davis going so far as to prefer to demolish and build anew at the site of the current Coliseum. Such a plan would force the A’s out, a possibility that Lew Wolff has been rightly concerned about. MLB’s involvement has pushed the pendulum in the A’s direction.
It’s cruel that the NFL and MLB are (not so) stealthily playing tug-of-war with the JPA over the Coliseum. As the Giants would say regarding sharing AT&T Park or giving up territorial rights to the South Bay, It’s not personal, it’s business.
As for AT&T Park? Who knows, that threat may resurface down the road.
Two competing narratives define Howard Terminal at the moment. The first, proffered by Oakland ballpark boosters, insists that because of the summer move to attain “site control” over the Port locale, getting a ballpark built should be a mostly a matter of procedure that can quickly result in HT being shovel-ready. The other narrative, promoted by this site and other skeptics, argues that because of the land’s heavy industrial and maritime uses over the last several decades, it could be prohibitively expensive and time-consuming to even attempt it.
Adding to the information fog surrounding Howard Terminal are suggestions that the permitting and CEQA processes for the site could somehow be streamlined. One Twitter follower even explained to me a few months ago that the site wouldn’t need rigorous environmental review because HT was somehow zoned for a convention center. That’s not true, and even if it was that’s a wholly different use and set of impacts compared to a ballpark. No, HT is zoned as heavy industrial, Port land. No commercial uses are allowed there. I’ve also heard that there’s a way to build at HT without breaching the thick contamination cap already there. That’s patently ridiculous. Now if someone wants to offer up some great technology that allows for building a code-compliant, earthquake-safe, 10-story tall permanent ballpark whose foundation doesn’t require digging out some dirt, I’m all ears. Pardon me for being cynical.
Or if you don’t want to pardon my cynicism, take it from the Port. In the aftermath of the SSA consolidation deal inked between the Port and one of its bigger operators, Port staff prepared a report for a forthcoming RFP to find bidders who could use HT in the short-term. The concern is that the Port is losing $10 million a year while Howard Terminal remains vacant post-consolidation. I’ve bolded some of the more noteworthy language, and summarized the issue below each quoted graf.
Urgency of Revenue
With the loss of about $10 million/year of revenue at Howard Terminal starting October 1, 2013, finding a new tenant that can quickly establish operations and pay rent to the Port is critical. Because the property is already generally permitted and entitled for maritime and maritime-related uses, maintaining land use consistency will help expedite occupancy. However, it should be noted that even some maritime uses may require additional entitlement work; for example, construction of extensive break bulk facilities may require some California Environmental Quality Act (“CEQA”) analysis and permitting work. This work, however, is expected to be relatively limited as compared to non-maritime uses of the property.
Issue #1: The Port is trying to maintain maritime use so that they can get a tenant in there tout de suite. That doesn’t mean that the Port is against a ballpark, but it’s clear that a non-maritime use like a ballpark is bound to be tied up in red tape for some time to come.
BCDC Seaport Plan
Howard Terminal is included in the Bay Conservation and Development Commission (“BCDC”) Seaport Plan as a “Port Priority Use” area. This designation is based on a Bay-wide study performed by BCDC periodically to determine whether enough capacity exists across all Bay Area ports to accommodate anticipated cargo growth in the long-term future. Using Howard Terminal for non-maritime uses conflicts with this designation, and de-designation of lands from Port Priority Use requires a Seaport Plan amendment, which is a fairly lengthy and involved process. To pursue an amendment, the Port would be required to provide evidence that sufficient capacity exists within the remaining Port seaport properties, or elsewhere within the Bay Area Port priority lands, to support the long term maritime growth demands for the region. BCDC would then independently analyze that information before proceeding with an amendment.
Issue #2: In order to accept non-maritime reuse of Howard Terminal, that red tape would include a Seaport Plan amendment, proof that the consolidation properly makes up for HT’s lost cargo handling capacity. If the consolidation doesn’t prove enough, more capacity would have to be found elsewhere, even somewhere outside Oakland city limits.
Tidelands Trust Compliance
Howard Terminal is currently encumbered by the Tidelands Trust. Uses of the property are therefore generally limited to water oriented commerce, navigation, fisheries, and regional or state-wide recreational uses. Approval from the State Lands Commission would be required for any uses of the property that are not Tidelands Trust compliant. Many non-maritime activities are not considered Trust compliant uses and thus may require lengthy negotiations with the State Lands Commission, and potential legislation, before the Port could proceed with such non-Trust uses for the property.
Issue #3: This is a very similar situation to what the Warriors face with their planned arena at San Francisco’s Piers 30/32. Howard Terminal is on the water, on the bay, thus any plans there mandate special consideration of the effects of such a project. Since that process could take years to shake out, project proponents have pushed local legislators to write “streamlining” bills that can cut down review time normally associated with EIR-challenging lawsuits.
Other Entitlement, Environmental & Regulatory Issues
Howard Terminal is subject to a complex set of regulatory permits and deed restrictions related to the hazardous materials in the soil and groundwater underlying the property. Development of new structures that penetrate the ground surface or changes in land use will require notices to regulatory agencies, and compliance with existing health, safety and soil management plans. Non-maritime uses will likely require extensive and expensive clean-up or other protective environmental measures, precluding expeditious turn-over of the property to a new rent-paying tenant. Further, non-maritime uses will likely require numerous land use entitlements including local land use permits, an amendment to the Oakland General Plan, and CEQA review. These activities could take several years to complete.
Issue #4: The cap problem.
Remarkably, there was no mention of a ballpark anywhere in the proposal for the RFP. There was also no mention of an EIR for a ballpark or any other Howard Terminal-related project. That makes sense when the goal is simply to get a tenant in there in the next year. No chance that can be anything but a shipping concern. Staff’s recommendation is to carry forward an RFP focusing only on maritime uses. That could change if City Hall leans hard on the Port to formally open up HT for non-maritime uses. Then again, as staff pointed out, Broadening the RFP scope further would complicate the evaluation process. SSA’s transition was originally supposed to complete at the beginning of this month. Now it may slip until January, which seems more realistic considering the work involved.
When it comes to Howard Terminal, you can read this site or listen to some story that some people are selling. Or you could disregard both and read Port staff’s own words. Don’t worry, I won’t be offended if you do. Mayor Jean Quan has been claiming for some months that some good news would be coming by the end of the year regarding HT. Hopefully the news isn’t limited to announcing that the Port has identified a new operator at the site for negotiations. That’s what happened with the Coliseum City RFP. In February 2012. The Port of Oakland has is semi-autonomous. It has to be fiscally responsible and self-sufficient. A $10 million hit per year is a big hit no matter how long it lasts. The Port also has another project, the Oakland Army Base reuse plan, which may now be counted upon to replace the jobs lost if Howard Terminal can’t find a new tenant. All of these issues and others are why I suggested caution when Howard Terminal came into play again. Now let’s see what site proponents can do about all the obstacles in their path.
P.S. – Don’t forget, the issues identified by Port staff don’t include issues that could arise specific to the construction of a ballpark: pedestrian and vehicular bridges needed over the Embarcadero railroad tracks, and potential resistance from Oakland residents over the prospects of a tall stadium on the waterfront.