Planning Workshop on Car Dealerships Raises Questions By RICHARD BRENNEMAN

Friday January 13, 2006

Wednesday night’s Planning Commission workshop on finding sites for car dealers in industrial West Berkeley raised as many questions as it did answers. 

Mayor Tom Bates and the City Council have asked the commission to consider zoning changes and plan amendments to allow car sellers to set up shop close to the freeway on land now zoned solely for manufacturing and industrial uses. 

The city is losing two major dealerships and is in danger of losing a third, and the question before planning commissioners is whether or not allowing them to move close to Interstate 80 will keep them in the city. 

City Economic Development Director Dave Fogarty said dealers are important for the city because new-car sales generate 11 percent of the city’s sales tax revenues. 

The city has lost one dealership—McNevin Cadillac at 1500 San Pablo Ave.—when it was sold to the Oakland Auto Center in December, and Fogarty said the ongoing boycott of Berkeley Honda has also probably led to a decline in sales tax revenues. 

A second dealership—McKevitt Volvo at 2700 Shattuck Ave.—will soon be moving to a new facility on Shellmound in Emeryville.  

Even the future of Berkeley’s dealer closest to the freeway and the biggest source of new car sales taxes, Weatherford BMW at 735 Ashby Ave., is questionable, Fogarty said. BMW doesn’t approve of the dealership architecture that seems more suited to a manufacturing plant than a luxury car sales facility. 

Fogarty said the pressure for moves is coming from car manufacturers, who want their dealers located in regionally accessible—“freeway close”—locations while Berkeley’s dealers are mostly located on Shattuck and San Pablo avenues, venues that were more suitable in the 1950s and 1960s. 

Weatherford’s lease expires in four years, “and they have told their landlords they’ll be leaving at that time,” Fogarty said. 

While Berkeley officials want to keep the dealership—which has the highest volume of sales of any Northern California BMW dealership—Oakland is recruiting the firm to relocate at the site of the old Oakland Army Base, Fogarty said. 

Even though several dealers have told Fogarty they’d be interested in moving to West Berkeley, he told commissioners that the most likely scenario would see the move of only one or two. Because dealerships typically have very low profit margins on new-car sales, they couldn’t afford to buy new sites where they have to compete with other more profitable commercial uses. 

“One of the original justifications of the manufacturing district was the fear that office and retail development would bid up the price of the land and price manufacturers out of the district,” he said. 

West Berkeley residents and business owners, already well organized in opposition to the mayor’s call to open up the Ashby Avenue and Gilman Street corridors, turned out in force to oppose any significant incursions on land now zoned for manufacturing and industry. 

“It looks like a nice idea, but if it means it will come at the cost of destroying an area plan, you have to be very careful going forward,” said Dale Smith. 

“What are the other options,” asked West Berkeley resident Ann Armstrong. “What are the other potential ways to gain sales tax?” 

Several supporters of the ongoing union job action at Berkeley Honda said that dealership shouldn’t be allowed to relocate until they settle with workers. 

John Curl, a West Berkeley woodworker and a leading opponent of the proposed zoning changes, said that any changes should come with mitigations to protect against the piece-by-piece dismantling of the existing manufacturing zones. 

“I suggest instead that the Planning Commission should give some thought about how to create the manufacturing zone of the future,” he said, “the manufacturing zone that Berkeley needs for the next century.” 

Several speakers mentioned that manufacturing jobs offer the highest blue-collar wages. 

Tim Southwick, who as the owner of Toyota of Berkeley for the last 33 years is the city’s new car dealer with the greatest longevity, said the ideal cost for dealership property is $25 a square foot—though a dealer like Weatherford could possibly pay as much as $85. 

“Volvo, Toyota—all the manufacturers want these new facilities, They want their customers to come into very nice facilities,” Southwick said. 

“It’s a wonderful paradox that the price of the land is low because it is zoned for manufacturing and protected by the West Berkeley Plan,” said commissioner Gene Poschman. 

Another opponent of reducing manufacturing zoning was consultant Neil Mayer, who in an earlier incarnation as founding director of the city’s Office of Economic Development, played a key role in bringing Weatherford to Berkeley. 

“Dealerships are not appropriate to the West Berkeley Plan,” he said, noting that the plan calls for any commercial uses to serve the neighborhood rather than the region. He said that a better location would be where self-storage units are located on the freeway frontage road, a use that creates few jobs and generates little revenue for the city. 

Susan Libby of Libby Labs said the city should look at long-term impacts of zoning changes rather than short-term sales tax gains. 

Southwick suggested that one possible change would be to allow smaller, boutique-type dealerships along the commercial corridors. 

By the time Commission Chair Harry Pollack adjourned the hearing, it was obvious that a lot more remained to be discussed, so he continued the workshop until the commission’s next meeting on Jan. 25.›