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Judge Overturns Council Decision On Gaia Building ‘Cultural Bonus’

By Richard Brenneman
Friday December 14, 2007

Berkeley City Councilmem-bers acted illegally a year ago when they handed developer Patrick Kennedy a victory in the ongoing battle over the cultural uses of the Gaia Building. 

That decision by Alameda County Superior Court Judge Frank Roesch, filed exactly one year after the council’s Dec. 12, 2006 vote, ends the latest round in the ongoing battle over the city’s controversial “cultural density bonus.” 

It was “inescapable,” the judge declared, that the council’s action setting forth rules for applying the bonus “was an abuse of discretion and must be struck down.” 

Roesch cited three specific discretionary abuses he said the council made in their decision, which was portrayed as implementation of a council resolution of the previous April 25 that tackled an ongoing sore point in Berkeley politics. 

But just what his decision means remained a matter of dispute Thursday.  

“This is a victory for the cultural use the community was promised long ago,” said Anna de Leon, the Gaia tenant who waged a long battle backed by Councilmember Dona Spring and others—to reopen the question of cultural use at the Gaia Building. 

“Simply put, the court overruled the lawless act of the council majority that favored the profit of one developer over the rights of the community.” 

But Zach Cowan, Berkeley’s acting City Attorney and the lawyer who represented the city in Roesch’s court, said the judge’s decision effectively restores provisions that are less favorable for the cause championed by de Leon. 

“It seems like the decision leaves them worse off than where they started,” he said. 

Dona Spring also hailed the judge’s decision as a victory, overturning what she called “a blatant violation of the city’s own laws” and the actions of former City Attorney Manuela Albuquerque, who she charged had “always sided with Patrick Kennedy against the interests of the city zoning board and the community.” 

“I am delighted but not surprised that we won,” said Patti Dacey, a private investigator and city planning commissioner who served on the Downtown Area Plan Advisory Committee and was one of three plaintiffs in the action. 

The others were musician Ellen Hoffman and sculptor Fredric Fierstein. 

“I’m not exactly sure what it means,” said city Planning and Development Director Dan Marks. “You’ll have to talk to Zach Cowan.” 

One of the three reasons Roesch declared the council’s December vote illegal was because city ordinance doesn’t allow the council to change a building’s use permit except when acting on an appeal from a decision by the city’s Zoning Adjustments Board (ZAB). 

The council had pre-empted ZAB action, and this “was simply without the statutory authority to modify the use permit.” 

Even if the council did have authority to modify the permit without a ZAB appeal, the action couldn’t be made without a public hearing. The council’s action without a hearing was yet another abuse of discretion. 

Finally, the council abused its discretion because it hadn’t reserved the power to alter or revoke a permit it had already approved and which gave ZAB broad discretion for modification or revocation.  

Kennedy, who did not return a reporter’s call, isn’t de Leon’s landlord anymore. In April, the developer’s Panoramic Interests sold his seven major Berkeley apartment projects with their 368 units to Equity Residential, one of the nation’s largest landlords and the source of the fortune which investor and corporate chief Sam Zell is now using to buy the Los Angeles Times.  

Kennedy remains a Gaia leaseholder. 


Battle of numbers 

The council’s action in April 2006 came a month after a March 23 vote by the Zoning Adjustments Board—triggered in part by complaints from de Leon. 

That action was followed by letters from an attorney for Gaia developer Patrick Kennedy threatening legal action. 

After the April vote, Kennedy said the council had reaffirmed what he understood was his original June 6, 2003 agreement with former city Planning Director Carol Barrett. 

The crucial paragraph of that agreement states: “We commit to the following performance standard: in the performance (theater) area, we will program performance use on 30 percent of the days of each month on average. In the reminder of the ground floor and mezzanine we will program arts related activities 15 days per month on average.” 

The council added language that the 30 percent figure applied to actual performance, “but must be expanded to include preparation time,” with performances given priority scheduling. 

Roesch’s decision voids the council’s Dec. 12, 2006, vote on a measure cited as action needed to implement the council’s action of eight months earlier. 

At issue is just how the building’s cultural space is to be used, with one critical question being the division of time devoted to public performances, including preparation and rehearsal time, and private, for-profit activities.  

With the help of city bonuses, Kennedy and partners—who include UC Berkeley business professor and entrepreneur David Teece—built the nine-story structure in a part of downtown Berkeley zoned for five floors. 

One of the extra floors of apartments was added explicitly because Kennedy had applied for the city’s cultural density bonus, which gives additional height and mass in exchange for providing community cultural space. 

Additional space was allotted under the city’s inclusionary ordinance, which at the time required housing projects of five or more units to add dwellings for low-income tenants. (Developers can now pay in-lieu fees, which fund units in affordable housing projects.) 

But the cultural space that won the bonus—the first floor and mezzanine—in the 2116-2120 Allston Way building was specifically created for the Gaia Bookstore, a local business that also hosted readings and seminars, rather than for a performance group or gallery. 

The bookstore closed before the building was completed, and the space was vacant and unfinished for several years until the Gaia Building LLC leased space to Anna’s Jazz Island and the owners of Glass Onion Catering. 

As a provision of the building’s use permit, profit-making businesses were allowed in the cultural space.  

Both de Leon’s business and the catering company are for-profit businesses, though the jazz club is specifically a performance venue. 

While a theatrical troupe offered shows in the theater space within the spaced leased by a partnership between Kennedy and Glass Onion, the group gave up because they couldn’t schedule enough performances to break even. 

Instead, the larger volume of space has been leased for private events served by the catering company and, for a time, church services. 

De Leon and other critics charged that use of the bonus space for private parties breached the intent of the cultural bonus statute. 


Troubled history 

The building has a troubled legal history, first from lawsuits over alleged construction defects that infested the building with mold and twice forced a resurfacing of the stucco-clad structure. 

Total costs of repairs reportedly topped the original construction costs. 

The city’s fire inspectors also found significant problems with the ground and mezzanine floors, including inadequate sprinkler systems, improperly installed and uninspected fixtures, and illegally posted signs which created greater occupancy levels that allowed by code. 

But the source of the current controversy, the cultural bonus, was created in the city’s current Downtown Area Plan, adopted in 1990. 

City planning staff didn’t adopt specific language for implementing the bonus laying out the requirements and limitations needed to qualify for the additional space, and when Kennedy applied to use it for the Gaia Building, city planning staff was left to figure out how it would apply to his project. 

One additional project won the bonus, the proposed Arpeggio Building, which would rise to nine stories across Center Street from Berkeley City College. Though approved more than a year ago, developers have yet to begin construction, with one source close to the project reporting that more funds needed to be raised. 

Specific language drafted for that project detailed precisely how the space was to be used, with Berkeley Repertory Theatre being the main beneficiary. 

The committee which prepared the proposed draft of the new downtown plan now making its way through the city planning staff before it moves on to the Planning Commission and City Council specifically declined to include the cultural bonus in their proposal. 

The fate of the Gaia’s Building’s cultural space remains in question, with a final decision still to be signed.