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Council Asks for Study On Hotel Funding

By Judith Scherr
Friday October 26, 2007

Despite concerns of some residents that the city could end up subsidizing a downtown hotel-condo project, the council on Tuesday voted 8-1 to accept the developer’s funds to hire a consultant to figure out funding. 

Councilmember Dona Spring voted against the proposal. 

The council also approved a 13 percent salary hike for firefighters and named the Planning Commission as the lead commission on Bus Rapid Transit. The city manager restored funding to the Quarter Meal program. 


Downtown hotel 

A downtown hotel at Shattuck Avenue and Center Street is in the planning stages, spearheaded by UC Berkeley, which owns the land where the 210-room facility would be built.  

The project, to be named the Berkeley Charles Hotel, is being developed by Boston-based Carpenter and Company and is planned to include a conference room, ballroom, retail space and 50 residential condominiums. 

A report authored by Acting Economic Development Division Director Michael Caplan urged the council to accept funding from the developer to pay a consultant to look at “possible mechanisms to provide tax abatement or other subsidies to render the project feasible.” Caplan’s report notes a $30 million funding gap. 

At the council meeting, however, Caplan underscored the limitations on the consultant’s work: “This does not commit the city to a project subsidy,” he said. 

The report says the funding gap can be partially resolved if the city waives some hotel occupancy tax revenues, funds that some councilmembers said should be used for other city projects. 

The council vote means accepting $50,000 from the developer to contract with Keyser Marston and Associates to address the funding gap and “find creative ways to close this gap” that includes “partnering with the city to rebate some portion of the Transient Occupancy Tax [hotel tax] generated by the hotel in its early years of operation.” 

Councilmember Linda Maio said she thought the project would generate funds for the city and agreed with most of the council that an expert should be hired to analyze the feasibility of the project. 

“We want to hire our own person to go through the numbers,” said Councilmember Linda Maio. “I’m concerned the numbers are so high.” 

A few members of the public and Councilmember Spring were less enthusiastic about the contract for the study, which they said would lead to city subsidies. 

“It’s nuts,” former Planning Commission Chair Zelda Bronstein told the council. While Bronstein said she supports the idea of building a hotel downtown, she cautioned, “The idea of the subsidy needs to be killed.” 

Spring was the lone council vote opposing acceptance of funds for the fiscal analysis. The proposed project may do more harm than good, she said. 

“We’re asked to violate the height ordinance,” Spring said. The hotel could be as high as 20 stories. “They want us to give away the sidewalk and the street and build luxury condos,” she said. 

The council turned down an addition to the resolution by Councilmember Kriss Worthington, who had wanted to include in the resolution an addition, asking the developer to include “community benefits” in the project, including offering “card check” (a way to unionize workers through cards they submit), green building and affordable housing. 


Firefighters’ contract 

Following an 8-0-1 council vote to approve a four-year contract, firefighters will get a 13 percent raise over four years, retroactive to June 2006. A 2008 ballot measure may be needed to help pay for the salary hike in 2009-2010. 

Spring abstained, calling for the council to delay consideration of the raise to allow “for more discussion on the impact on future budgets.”  

Councilmember Gordon Wozniak disagreed. “The city has been in negotiations for a year and a half,” he said, pointing out that the firefighters’ contract expired in June 2006. In other years the raises have been 5 to 6 percent, he said, adding that the approximate 3 percent salary hike per year mirrors the city’s revenue growth. 

The proposed contract places firefighters near the median salaries of firefighters in nearby districts, wrote City Manger Phil Kamlarz in a report to the council. 

Kamlarz also noted in the report that the anticipated revenue increases would be sufficient only through 2008. “However, the [fiscal year] 2009 adopted budget does not include funding for full staffing, which is currently being considered as part of a potential ballot measure for November 2008,” Kamlarz wrote. 

Spring argued that the public had not had time to read the report, delivered to the council and public just before the meeting. “We should be willing to let the public scrutinize this before we vote. Who do you think pays the bills around here?” she asked. 


Bus rapid transit (BRT) 

The City Council unanimously approved a resolution directing the Planning Commission in cooperation with the Transportation Commission to lead Berkeley’s process for public discussion and input on Bus Rapid Transit, an AC Transit proposal that would, if fully implemented, dedicate lanes for buses on Telegraph Avenue and other streets in Berkeley, Oakland and San Leandro. 

A staff report on the question indicates that the commission should be ready to present its “preferred alternative” for BRT implementation to the City Council by March 25. In addition to dedicated lanes, BRT can include technology to turn traffic lights green, ticket machines at bus stops, more frequent bus service and other features. 

The debate among public speakers at the meeting was over whether the Planning Commission or Transportation Commission should take the lead on the question. The argument for the Planning Commission was that it would look at broader ramifications of BRT—economic development and more—while the Transportation Commission would have looked more narrowly at questions such as side-street congestion that could result from BRT. 

The Transportation Commission has been favorable toward BRT. 

The resolution includes a proposal to AC Transit to conduct a feasibility study among the communities along the BRT route on the eco-pass concept, where bus passes are subsidized by the community or by businesses. 


Quarter Meal 

A vote of the council wasn’t necessary on Councilmember Worthington’s resolution to restore funding to Berkeley Food and Housing’s “quarter meal” program. The program was asking for $23,000 that had been cut from the city’s budget in June. City Manager Phil Kamlarz, however, said there was $2,000 per month until February in the city coffers to fund the program.  

At midyear, when the city takes a fresh look at its balance sheet, it might be able to give the program another half year of funding, he said. 

The Quarter Meal Program serves hot meals, five evenings per week at Trinity United Methodist Church on Bancroft Way.  


Editor’s note: Zelda Bronstein is currently volunteering as a proofreader for the Planet.