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A sharp schism between city staff and veterans of the panel charged with formulating policies for a new city density bonus law revealed itself at the Planning Commission Wednesday night. 

The heart of the issue is just what the city can and cannot require of developers who say they can’t build their projects unless the city waives some of its restrictions on the size and shape of their projects. 

Only one developer attended the Wed-nesday night session, but Chris Hudson is one half of the team that created the project that sparked creation of the Joint Density Bonus Subcommittee. 

Hudson McDonald LLC is developing the “Trader Joe’s building” at 1885 University Ave., which has become the target of a lawsuit filed by neighbors, including Steve Wollmer, a Housing Advisory Commission (HAC) appointee to the density- bonus subcommittee. 

The two legal adversaries sat separated from each other by a single row of folding chairs. 

The Trader Joe’s project—called “The Old Grove” by its developers because it’s on the corner of Martin Luther King Jr. Way, formerly Grove Street—won a city permit to rise to its projected five stories—one more than current zoning allows—in part because city staff held that more size was needed to accommodate parking spaces for the popular grocery store the developers said they were bringing to the ground-floor commercial space. 

The subcommittee, originally created by the Zoning Adjustments Board (ZAB) and later expanded by the City Council to include members from HAC and the Planning Commission, made clear that they wanted the law to allow bonuses only in return for low- and very low-income tenant housing. 

“I would call for a density penalty,” said Hillegass Avenue resident George Oram during the public comment period. 

“I agree,” said Bruce Kaplan, the manager and part owner of Looking Glass Photo & Camera, a 34-year-old Telegraph Avenue business. 

While acting City Attorney Zach Cowan and acting Land Use Manager Debra Sanderson say the subcommittee’s recommendations go beyond what the law allows, subcommittee members point to similar or-dinances already in place in San Rafael, Santa Monica, Los Angeles and—closer to home—San Leandro, Albany and El Cerrito. 

Those governments use what subcommittee members have called a “two-menu approach,” one that places different requirements on developers, depending on the level of legal exemptions they seek. 

While a base menu allows exemptions for moderate exceptions for development standards, the second menu demands that developers submit financial evidence proving their projects aren’t feasible without significant deviations from zoning standards. 

Bob Allen, a ZAB member and architect who served on the subcommittee, urged commissioners “to keep your eye on the big picture because it’s such a messy and complex issue.” 

Allen said ZAB created the subcommittee initially “because we felt we didn’t have control over our own zoning” because the state density bonus law preempted city regulations absent a city density bonus ordinance. 

“We have to approve buildings 35 percent larger than anything” in the existing zoning code, “and neighbors there are really angry, and reasonably so,” Allen said. “They had no idea when they bought their homes that they would get projects this size” in the immediate neighborhood. 

“We want to get some way that we’re actually in the driver’s seat of what goes on,” because “state law has obliterated the intent of our zoning law,” he said. 

The subcommittee proposals would grant developers a maximum 40 percent bonus, but only if they provided affordable housing and financial data to back their claims that the bonus was needed to make their buildings economically feasible. 

Wollmer said the staff memo challenging the legality of two-memo approach was “somewhat deficient,” and called Cowan’s legal opinion “the equivalent of a signing statement.” 

“We think we have provided enough op-tions for a developer to achieve their dens-ity bonus with the least detriment to neighbors,” he said. 

“I hope you take the subcommittee’s recommendations very seriously,” said HAC Chair and subcommittee member Jesse Arreguin, charging that currently city policy had hindered development of affordable housing in commercial projects, while market rate units had multiplied. 

He cited the 25 market rate units granted Hudson McDonald for commercial parking in the Trader Joe’s project. 

“I’m that pesky developer at 1885 University, and I got the density bonus to make the project viable—not for any particular element,” said Hudson, who said that “almost every project since 1997 has contained affordable units.” 

Without the bonus, he said, Berkeley probably wouldn’t be getting any new housing at all, while the subcommittee’s proposals “are really down-zoning.” 

Because of current economic conditions, he said, “the pace of applications is going to slow down dramatically. There’s no money, and there is a slowdown in demand,” making it a good time “for more holistic planning,” he said. 

Commissioner Gene Poschman challenged the developer, stating that Berkeley’s first density bonus project came in 2003, not 1997, under former Planning Manager Mark Rhoades. He said less that 14 percent of new units in commercial projects were reserved for low- and very low-income tenants.  

Sanderson disagreed, saying “there are some myths in Berkeley about what is being built and about the size of the units.” 

Commissioner Harry Pollack, a land-use attorney, said the tension boiled down to the conflict between the state density bonus law and ZAB’s desire to manage projects. 

“There’s a lot of tension here about this issue. I understand it, but I don’t think it’s helpful,” he said. 

Prop 90 concerns 

What makes the matter more urgent, said Commissioner and subcommittee member Gene Poschman, is the looming deadline mandated by Proposition 98 on the June state ballot. 

That measure is a revised version of Proposition 90, which was narrowly defeated in November 2006, and would end rent control and limit the ability of government to take private property by eminent domain. 

Proposition 90 allowed property owners to sue governments for any laws that reduced the maximum possible profits they could extract from their properties, which included zoning changes to restrict land use as well as outright eminent domain actions. 

Opponents argued that Proposition 90 would have effectively prevented California cities and counties from enacting any zoning law changes that restricted development. 

While proponents of the measure—the Howard Jarvis Taxpayers Association—claim the new version eliminates that most controversial provision of its predecessor, Proposition 98 would also end rent control in California—which would undoubtedly impact the ability of cities to offer affordable housing in commercial projects, say opponents. 

“I guess I’m shocked,” said Poschman when Principal Planner Alex Amoroso said that staff hadn’t made special provision to analyze the ballot measure’s impact in advance of the election. 

Prior to the November 2006 vote, the City Council rushed through temporary measures to have in place in the event Proposition 90 had passed—something the staff hadn’t considered for the coming vote. 

“I never agreed to put off development standards to March or April,” Poschman said. 

Commissioner Susan Wengraf, another subcommittee member, joined Poschman in asking for a staff analysis of Proposition 98 and its impact, a call echoed by Helen Burke. 

“Okay, we can do that,” Amoroso said.