Page One

In order to get enough money to build what has been billed as the greenest project in Berkeley, the city may have to ask federal officials to designate part of the downtown as a brownfield—a term that typically applies to contaminated industrial sites. 

The designation could mean $2 million in extra federal funding to help build the David Brower Center, a combination of affordable housing, retail and office space for environmental groups on Oxford Street. The project, estimated at $50 million, is facing $4 million in increased cost estimates with still a year to go before construction is scheduled to begin.  

Although there is no sign of contamination at the site, the development’s partners, the David Brower Center and affordable housing developer Resources For Community Development, are asking the city to apply for the federal grant for contaminated sites on the basis that the Oxford Street parking lot has potential for contamination and is in a low-income area. 

The City Council must approve the application, which has a June 17 deadline. 

Slated to rise above the Oxford Parking Lot at Oxford Street between Kittredge Street and Allston Way, the Brower Center, which has already received $2.5 million in city housing funds, has been heralded by city leaders as a future jewel of the city’s ailing downtown.  

However, a group representing downtown merchants has withheld its support for the project over fears that it would further diminish downtown’s reduced parking capacity. 

On Thursday Berkeley’s Housing Advisory Commission, over the staunch objections of several members, voted 5-3-1 to recommend that the City Council apply for the grant.  

“This is not a brownfield,” said Commission Chair Anne Wagley, who wanted to reserve applications for Berkeley projects proposed for actual contaminated sites. (Wagley is an employee of the Daily Planet.) 

But the Federal Department of Housing And Urban Development, which manages the grants, thinks otherwise, city officials said. 

Under HUD’s definition a project may qualify if it is complicated simply by the “potential presence of contamination.” Roger Asterino, a city housing official, said local HUD officers supervising the grant program were familiar with the site and recommended that the city apply for the grant. 

The HUD grants, unlike similar grants offered by the federal Environmental Protection Agency, are also designed to spur economic growth in low-income neighborhoods. Because downtown Berkeley, home to hundreds of UC students, qualifies as a low-income area and the Brower project is estimated to create 140 jobs, city officials have been led to believe they have a good chance to win the grant. 

Just last year, HUD issued a $2 million brownfield grant to the Ed Roberts Campus, slated to rise on the northeast parking lot of the Ashby BART Station, which also had little evidence of past contamination. 

If Berkeley applies for and receives the grant, it likely won’t be able receive another brownfield grant for the foreseeable future. Because each grant is coupled with a $5 million HUD loan that the city must guarantee, Berkeley only has means to take on two brownfield grants at a time, city officials said. 

Housing Commissioner Vicky Liu argued that the Brower center was too important a project not to seek the extra funding. 

“This is an opportunity we should take advantage of,” she said. 

Brower Center Project Manager John Clawson said the latest estimates for building one level of underground parking rose from about $4.8 to $6 million. Rising costs of steel and concrete, he added, had increased the total cost by about $4 million. Clawson said the developers could provide $2 million more, but needed the grant to help build the underground parking and some of the retail space. 

The project financing is one of the most complex ever attempted in Berkeley, said Housing Director Steve Barton, adding that all of the funding sources have not yet come together. 

Meanwhile downtown merchants are pushing for the city to find a way to build a second level of underground parking at the site. The merchants are angry that the underground lot will only have 105 spaces while the current lot has space for 130 vehicles. 

“We’re concerned about the vitality of that project as well as its domino effect on the downtown if the parking issue isn’t addressed,” said Deborah Bahdia, executive director of the Downtown Berkeley Association. 

Bahdia said the downtown has lost 400 parking spaces over the past five years to new developments. She said the organization had considered assessing itself a fee to pay the estimated $6 million for a second level of parking, but learned that it would be illegal because the lot will be private property, owned by the developers. 

Under a deal between the city and the developers, the city is to sell the property, valued at $4.2 million for $1. In return, the development is to lease the underground parking lot to the city, which would receive parking lot revenues, currently estimated at $300,000. Should the brownfield grant not come through, Clawson said the city would have to accept less revenue from the parking to pay for the cost overrun on the lot.