It was after 11 p.m. last Tuesday, and the council chamber was nearly empty, when Dave Blake stepped up to the lectern and used his two minutes of public comment to warn the council that its secretive ways were undermining Berkeley’s ability to generate revenue at the ballot box. Describing himself “as a citizen who’s been involved in raising money for the city”—Blake has campaigned for measures to fund the city’s library, parks and warm water pool—the former Zoning Adjustments Board member obliquely referred to the failure of the four city tax measures in November 2004: “A lot of people think that the reason we’re no longer successful in passing items in this city,” he said, “is that we’re not generating the feeling of trust between the council and the people in the city … I don’t think we’re going to be passing any two-thirds measures in the near future, unless we start to be open and clear about big decisions like this one.”
The decision at hand was whether the city should accept $50,000 from the developer of the proposed downtown UC hotel/conference center, with its 19-story tower of luxury condominiums, to pay a “consultant team” to do what the staff report called “feasibility analysis and review of possible mechanisms to provide tax abatement or other subsidies to render the project feasible.”
The project is currently unfeasible, the report explained, because it is now estimated to cost $30 million more than the revenues it’s expected to yield. The developer, Massachusetts-based Carpenter and Company, says it may be able to reduce the overrun by “nearly half” through “creative measures, including value engineering.” To close the remaining $15 million gap, the developer and the city are contemplating a “public-private partnership” that involves rebating “some portion of the Transient Occupancy Tax generated by the hotel in the early years of its operation.”
This was a big decision, all right, and not just because of the size of the proposed bailout. Berkeley has never subsidized a project of this sort—a private, for-profit hotel/conference center-cum-luxury housing. Indeed, it was the novelty of such a subsidy that led City Attorney Manuela Albuquerque, at the Agenda Committee’s Oct. 15 meeting, to defy Mayor Bates. Ever averse to public scrutiny of his backroom deals, the mayor wanted the item to go on the consent calendar, where it could be approved without any discussion. In a welcome show of independence, Albuquerque insisted that the matter had to go on the council’s October 23 action calendar. At the start of the Oct. 23 meeting, Councilmember Wozniak tried to move it back onto consent. Before the city attorney could weigh in, Councilmember Spring intervened, saying she wanted it to stay on action, and there it remained.
It was about three and half hours later that Blake objected to having an item of such magnitude squirreled away “in an obscure part of the agenda” and then taken up late at night. He asked the council to send the proposal to the Downtown Area Plan Advisory Committee and to the Planning Commision for review and recommendations. Other citizens, including myself, expressed even stronger objections, recommending that the mere idea of a massive tax rebate for a hotel/conference center topped by (mostly) luxury condominiums should be rejected outright.
In the spring of 2004, when I was chairing the Planning Commission, I helped convene and then served on the UC Hotel/Conference Center Citizens Advisory Group. The group’s extensive recommendations said nothing about tax rebates (or, for that matter, luxury condos). Indeed, the project was sold to the community as a major revenue generator. With a city budget balanced with deep cuts in staff and services, $160 million in unfunded municipal liabilities and three revenue measures under consideration by the council for the November 2008 ballot, the thought of rebating $15 million worth of taxes to a private developer of luxury condos atop a hotel/conference center intended primarily for UC clientele is unconscionable.
But the fix was in—indeed, it’s been in for a while: According to the staff report, the consultant team has already been chosen, from interviews conducted last summer. In other words, months before the item appeared on a council agenda, city officials were moving it forward as if it were a done deal. Shades of the Ashby BART “transit village” fiasco!
The back story helps explain why last Tuesday the council majority insisted that the developer’s gratuity had to be accepted that very night. Throwing Blake a sop, Councilmember Maio averred that the council would “share” the consultant’s “results” with DAPAC. But Blake had asked that DAPAC (and the Planning Commission) review the hiring of the consultants, not their findings.
Mayor Bates didn’t bother with sops. “I think it was really an error,” he said, “to put in [the staff report] the $30 million hole.” (Replied the report’s author, Office of Economic Development Acting Director Michael Caplan, “That was the developer’s latest estimate.”)
But it was Kriss Worthington, of all people, who offered the most fulsome defense of the developer and the proposal. Carpenter & Co., he said, had made all sorts of promises to the community, agreeing, for example, to build affordable housing into the project. Nobody thought to remind the councilmember, now completing his eleventh year in office, that Berkeley law requires any project of 5 units or more to include at least 20 percent affordable housing.
Worthington’s sometime ally, Dona Spring, challenged his tribute to the developer’s generosity on other grounds. She pointed out that, far from bending over backwards to accommodate the city, Carpenter & Co. was already asking to violate Berkeley’s 7-story downtown height limit and to be granted rights to the sidewalk and part of the street adjacent to the project site as well. The consultant’s findings, she predicted, would be used to justify massive tax rebates to the developer. To Spring, that prospect was unacceptable. When the council approved the staff recommendation on an 8-1 vote, she was the lone dissenter.
So much for restoring the public trust. Worse yet, this was the second time that night that the council majority denied their constituents an opportunity to scrutinize a very big-ticket item: They’d already disposed of the first item on their consent calendar, the new contract with the Berkeley Fire Fighters Association, in a peremptory manner.
That the firefighters’ contract appeared on the consent calendar in the first place was deplorable. The four-year memorandum of understanding with the BFFA will have a greater impact on Berkeley’s future, fiscal and otherwise, than any other action the council will take in the next four years. With that impact in mind, Spring moved it onto the action calendar.When the item came up, she asked that it be held over until the next council meeting on Nov. 6, so that the public could study the information that the city manager had distributed at the start of the meeting. That information, which ostensibly supported the 13 percent salary raise and the various increases in benefits in the MOU, had not been provided to the public when the contract first appeared on the council agenda, on Oct. 9. It was made available on Oct. 23 only because Spring had requested it.
Once again, her appeal “to show the taxpayers a little respect” was rebuffed by her eight colleagues, all of whom insisted that the council had to act right away, and that “dragging it out” for two more weeks, after 17 months of negotiations, was unthinkable. Yet on Oct. 9, nobody on the council uttered the slightest protest when, in response to a mysterious request from the firefighters’ union, the city manager pulled the MOU from the council agenda and held it over until Oct. 23.
Seeking to defuse the issue, the mayor asserted that the item had “been out for at least a month.” Spring immediately disputed his claim. “The info,” she said, “has only been available since tonight. I have not had a chance to read it. The people who came to the meeting—” Bates cut her off mid-sentence with a curt rejoinder: “Then you should abstain.” Boos and hisses filled the then-packed chamber. Banging his gavel, Bates snapped, “This is not a kangaroo court. If you’re going to act like that, we’re going to ask you to move—right now—full stop!” Someone called the question, and the council voted 8-0-1 (Spring did abstain) to approve the contract.
I wish that the mayor had cleared the room, and that the council had continued to meet and to take action in a venue from which the public had been expelled. That scenario would have made starkly palpable what’s going down in Berkeley City Hall.