The End of Non-Binding Season

All I wanna do is zoom-a-zoom-zoom-zoom

Best moment of last night’s Alameda County Board of Supervisors meeting came shortly after Oakland Mayor Libby Schaaf presented her Howard Terminal pitch over Zoom. In the discussion that followed nearly 2 hours into the item and 5 hours into the meeting, questions came up about what the Supervisors wanted to do with the resolution at hand that night. Eventually it became a matter of semantics with a debate over whether the Supes were putting together a “declaration of intent” or a “declaration of willingness.” I started to chuckle at the absurdity of that display as the County Counsel tried to verify whether the language of the resolution properly referred to it being “non-binding” (it did). Here’s the relevant language:

Section 2. The Board hereby declares the non-binding intent of the County to contribute the County’s share of the incremental property taxes, inclusive of property taxes in lieu of vehicle license fees, that will be generated from development of the Waterfront Ballpark District at Howard Terminal into an EIFD to be formed over the project site for the purpose of financing affordable housing, parks, and other infrastructure of community-wide significance, for a period of 45 years and that the County’s commitment to contribute would not guarantee a specific amount, would solely be limited to contributing such taxes actually received.

And to put a finer point on it:

Section 3. The Board hereby finds that this declaration of non-binding intent to is not subject to CEQA because this action is non-binding, does not result in any discretionary approval or grant vested development rights, and does not commit the County to any definite course of action; accordingly, this action does not constitute a “project” under CEQA Guidelines.

Supervisor Wilma Chan declared support for the motion with a hedge, saying that the Board could easily go back on the non-binding vote. That stands in stark contrast to Board President and Supervisor Keith Carson, who said that he didn’t want to vote in that manner. In fact, he said that a non-binding vote once cast, is hard to walk away from. Debate aside, the question of a non-binding vote’s political power will be rendered moot soon as far as Howard Terminal is concerned. That’s because with Alameda County voting 4-1 to pledge its share of property taxes from the development, they’re now a party to this as long as the project continues to move forward. Let’s be clear on this point, however: last night was for all intents and purposes the last “non-binding” vote for Howard Terminal. Just about everything from here on it, whether it’s a decision taken by the City of Oakland, Port of Oakland, Alameda County, BCDC, or SLC, is very much a binding decision.

The takeaway is that it’s hard to play Kool and the Gang’s “Celebration” after all of this. The fact of the matter is that these were supposed to be the easy votes, the rubber stamps. They weren’t. There’s little reason to take a single item marked by its legal impotence and turn it into a 7.5-hour marathon session.  The votes from this point forward only become more difficult, whether we’re talking about the EIR certification or the actual business deal to develop the land. Those will be make or break votes, the ones where truly tough decisions will have to be made. But first, the EIR.

I assembled a full thread of observations from the day’s proceedings.

Under the radar, Chan mentioned that the A’s, who are providing the loans for the infrastructure at Howard Terminal, will charge interest to the City and County for those loans. This should be interpreted a couple of ways. First, as the A’s are a private entity, they aren’t expected to be eligible for tax-free loans even if it’s for public infrastructure, which is mostly funded by municipal bonds. Here’s where I will have to defer to an expert on public finance, as it’s unclear where the private part ends and the public part begins. I also have no idea what would happen if, in the next 2-3 years, interest rates go up. Would that cause the A’s to back out of some part of the private financing pledge because it doesn’t pencil out compared to traditional municipal bonds. It’s worth considering the implications. Note that the current discussions have City and County pulling together to create a PFA (public financing authority) for infrastructure bonds.

Former City of Alameda Mayor and current Councilperson Trish Herrera Spencer spoke during the public comments period about a letter drawn up by the City of Alameda in support of the Howard Terminal project. It was nixed apparently because resoundingly negative feedback (43 comments against, 2 for).

Not to be forgotten is how the state of Washington put up hundreds of millions in infrastructure including the surface roads and ramps connecting the freeways to the Port. And we can’t forget the the big public subsidies in both stadiums. A better, more current example of this conflict is the SoDo arena proposal, planned for the same area to the south of the stadiums. It was harshly opposed by the Port of Seattle and died during the process, which allowed the existing arena (Key Arena/Seattle Center Coliseum) to be rebuilt as a NHL venue which opened this year, Climate Pledge Arena.

Alameda County also asked for the A’s to pay for a further Howard Terminal study whose scope is uncertain. A’s President Dave Kaval responded positively to that request. I think there’s already supposed to be a thorough economic impact study encompassing the regional impact. I’m not sure if Alameda County wants to help define or expand that.

There was also some confusion about who initiated the City’s request of the County to enter the EIFD. Kaval confirmed that the A’s did not make such a request, which apparently was a rumor dating back from earlier in the spring. The A’s also didn’t want the City to scrap the second IFD proposed at Jack London Square either. For better or worse, the City of Oakland has the reins now. The ball is fully in the City’s court.

The off-site cost estimate is currently $351.9 million and is the sole responsibility of the City, which is hoping a state windfall will help. Federal funds are looking less likely with each passing day. Memorize that number for future reference.

Responses to the public comments are coming. If the Final EIR drops before the December break, it will kick off a new comment period which will probably be extended like the Draft comment period was. After that, we’ll get proper breakdowns for mitigation cost estimates and alternative steps, if not wholesale changes in the plan. If everything goes well, there’s a chance it could all be approved by Opening Day. Given how this project’s only constant is its inability to stick to its timeline, I wouldn’t bet on it.

6 thoughts on “The End of Non-Binding Season

  1. You seem to be less skeptical of the eventual outcome than a few months ago, no?

  2. BTW, regarding the off site cost estimate at (currently) $351 million: I’m thinking more like $400-450 million in the near future! Can I wager some funds on that ML?..

  3. HA! Yesterday’s development was soo Earth shattering that Bob Melvin left! Congrats to BoMel, who’s now in a beautiful city, with a beautiful ballpark… and a beautiful payroll! He’d never get that in Oakland!

  4. ML,
    Any idea what universe Casey Pratt resides in?.. (It’s definitely not this one!)

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