City staff are presenting this important, and hopefully long-term, planning policy during an uncertain climate. Though many development projects are on hold, others are in progress, and downtown is seeing an uptick in retail businesses. Inclusionary Zoning, a controversial policy that has been a touchstone in Oakland’s development politics for a decade, is in legal limbo after a Los Angeles developer successfully challenged an affordability mandate as a violation of Costa-Hawkins, the state law that banned vacancy control and restricted rent control to pre-1980 buildings. With the State Supreme Court declining to hear an appeal of what is being called the Palmer decision, it seems like a major potential barrier to new development is no longer an option.

On Monday, the Landmarks Preservation Advisory Board will be discussing the citywide rezoning as well, but within their subject area. If you’re interested in how rezoning may impact historic preservation, check out the agenda and the staff report. There are three opportunities to attend meetings about rezoning, so a student of Oakland’s future has no excuse but to attend!

Eagle-eyed followers of the City Council run-off election between AC Transit at-large Director Rebecca Kaplan and School Board District 1 Member Kerry Hamill will have observed that the two biggest PACs driven by real estate interests have chosen different candidates. Kerry Hamill’s signs were funded by the Coalition for Jobs and Housing, comprised of many of the largest developers and businesses in Oakland. The Oakland Builder’s Alliance, on the other hand, hosts a fund-raiser for Rebecca Kaplan this evening. Those who see city politics as developer-driven must be confused. Developers are split because the candidates’ differing views on city development policies, transportation improvements, and transit-oriented development have different impacts on smaller and larger developers.

As the Ada Chan debate highlighted, some non-profits are constantly pushing for “community benefits” that come out of a developer’s pocket. Currently, only very large projects receive the political and media attention that allow these groups to successfully demand concessions in the form of affordable housing or other “community benefit” funds. Those projects, which often receive city subsidy and involve publicly-owned land, are executed by large developers working on a national (like Forest City) or super-regional (like Signature) scale, represented by the Jobs & Housing PAC. Smaller developers, among the members of the Oakland Builders’ Alliance, are much more interested in the details of citywide policies, that would mandate “benefits” like Inclusionary Zoning, than the big boys, because they don’t currently have to cough up for them. Kerry Hamill blithely announced during a private endorsement interview that she would happily vote for the deeply flawed Inclusionary Zoning Ordinance proposed in 2006, and that she supports unlimited condo conversions with no restrictions. It’s Rebecca Kaplan’s strong understanding of Smart Growth and concern for its details that attracts smaller developers, while large developers see little impact to their bottom line and so are uninterested by Kaplan’s depth of knowledge on the topic.

Both candidates know details about public transportation from their work with the East Bay’s two biggest transit agencies. Development and transportation are deeply linked. But the differences between the transit agencies they represent has different implications for different developments. Smaller-scale, infill, and residential-only developers are much more likely to be near AC Transit routes than BART stations. Downtown and Jack London Square developers seethe over poor bus service, but rather than blame AC Transit Director Kaplan, they look to her transit leadership to advocate on their behalf on the Council. Ms. Hamill’s BART, as we recently learned, has no capacity to expand service, and is far from much of Oakland anyhow. Bus service is simply more important to smaller developers, who can’t afford to build fantastic monorails or even subsidize shuttles, than to large developers.

The ladies’ experiences at different transit agencies also informs their vision for Oakland’s future development. In her interview with Oakland Focus, Kerry Hamill dismissed infill development along the BRT corridor in favor of large-scale “walkable” projects around BART stations. She said:

We spend a lot of time at the City Council, Zennie, fighting about existing neighborhoods and their concerns about maintaining their local identity and whether a building should be four stories or six stories or this story or that story. I am interested in building new neighborhoods in places of Oakland where there’s not anything going on. Rather than fighting, and trying to put denser housing in existing neighborhoods than a lot of people want, I’d rather see us looking at that area around BART stations, for example, where we’ve got billions of dollars of infrastructure.

Smaller developers need to build denser housing in existing neighborhoods: they don’t have the marketing budget to create “a village for the future.” Big new BART transit villages are fine, but those are one-off projects that benefit only one or two large-scale developers. Rebecca Kaplan has embraced the longer-term vision, spelled out in the General Plan and the Conley Report, of well-planned, multi-party transformation of arterial corridors throughout the city. With more possible actors and a more comprehensive scope, it is no wonder that small builders dispersed throughout the city embrace Ms. Kaplan’s vision of green infill development along all transit routes over Ms. Hamill’s centrally-planned “new neighborhoods” at Oakland’s few BART stations.

Public safety is clearly the largest impediment to business attraction and real estate investment right now. Both candidates devote a great deal of attention to public safety, although observers like V Smoothe argue that Ms. Kaplan’s safety platform is superior. It is not public safety, but longer-term issues like the details of development policy, improving transportation for all neighborhoods, and valuing citywide redevelopment, that separate large-scale developers from smaller-scale builders in this City Council election. It will be seen tonight, and as the election progresses, which faction is able to raise more money and communicate a more sympathetic message to Oakland’s strongly pro-growth voters.

Last year, two Planning Commissioners sparked a stir when they attempted to hold up Trader Joe’s liquor licenses in an attempt to bully the store into accepting unionization. Recently, Inclusionary Zoning representatives told the Zoning Update Committee that they “demand” their pet policy as part of citywide zoning updates. This has led businesses to fear that political groups want to use the Planning Commission to force developers to implement policies they can’t get through the City Council, greatly complicating the already difficult zoning update. Tonight, the City Council will debate an appointment that crystallizes these fears: Mayor Dellums’ nomination of SF “anti-gentrification” activist Ada Chan to the Oakland Planning Commission (pdf).

The battle lines are starkly drawn. Ideological organizations have scheduled an evening rally outside City Hall, with anti-development group ONWRD joining with labor unions to press for Ms. Chan’s confirmation, and the top anti-development lobbyist, Margaretta Lin of the East Bay Community Law Center, working overtime for Ms. Chan. Jean Quan’s staff, Ms. Chan herself, and Joel Tena of East Bay Housing Organizations are promoting her appointment on District 4’s neighborhood listserves, leading some insiders to speculate that she is being groomed to replace Ms. Quan in 2010. With large and controversial projects moving through the pipeline (including four buildings that would be the tallest in Oakland), the stakes are high and developers are scared.

It doesn’t help that Ms. Chan, emphasizing her devotion to anti-development policies she worked on with Supervisor Chris Daly in the Mission and SOMA, won her nomination over a West Oakland resident who stressed the need for Planning Commissioners to live in areas impacted by development so they have a better understanding of the importance of design and context (Ms. Chan lives in the Laurel District). The Oakland Builders’ Alliance and the ethnic Chambers of Commerce, worried by Ms. Chan’s policy record as well as her refusal to meet with them to discuss her nomination, are explicitly opposing her appointment in an unusual and risky move. The scuttlebutt is that the Council is split along familiar lines, with Jane Brunner, Nancy Nadel and Jean Quan supporting the nomination, and Ignacio de la Fuente, Larry Reid and Henry Chang opposed, leaving Pat Kernighan and Desley Brooks as the deciding votes.

With the players aligned as in other controversial development issues, the fight over Ada Chan’s nomination increasingly appears to be a proxy fight over Inclusionary Zoning and other expensive policies that developers oppose as unduly burdensome. But that is not how Planning Commission appointments should be made. Planning Commissioners are not supposed to create de-facto development policy using the heavy hammer of planning permission, but to interpret the existing policy and apply it to specific projects. The groups pushing for anti-development policy along with this nomination clearly expect Ms. Chan to behave differently if confirmed to the Planning Commission.

This week, everyone but the Trib is making endorsements in the many competitive elections in Oakland and the East Bay. So, like Robert Kennedy, I thought Why not? Here are my endorsements for who will make decision affecting the future of Oakland, from a transit and Smart Growth perspective.

City Council District One: Jane Brunner

I have a lot of problems with Ms. Brunner, so this endorsement comes with serious caveats. I think that she is often illprepared for meetings, as V-Smoothe pointed out, and seems to vote however the last person who got to her wants her to vote, but her staff is not as scattered as she is. I’ve already decried using Inclusionary Zoning, a rare ideological split on the Council, as a litmus test, so I’ll forgive her decade-long quest to impose price caps on condos. The real housing issue is that District One builds no affordable housing, and very little entry-level housing. I grew up in Rockridge and I’ve been forced out by the lack of development! There are fewer apartments now than there were in 1987, when Market Hall opened, and no newly-built condos. Ms. Brunner has offered little leadership on development in Temescal, instead exacerbating the neighborhood’s battles by meddling in projects (with the full consent of the rest of the Council). However, Mr. McCullough has no position on development.

The hot issue is crime, but Ms. Brunner hasn’t been particularly worse than anyone else on the Council; unlike Jean Quan and Nancy Nadel, she’s not a ringleader of the anti-cops brigade. Her shameful refusal to condemn Black Uhuru’s slander of Mr. McCullough is disturbing, but she does listen to crime concerns and is belatedly pushing for the high-tech crime-reduction strategies championed by Sean Sullivan. Honestly, I don’t see Mr. McCullough offering much in the way of crime but attention. Unlike Sean Sullivan, he doesn’t have detailed plans or a clear policy direction. I think Mr. Pine has the same problem except that he talks about the number of police relentlessly. Mr. McCullough also has no support from other councilmembers or institutions so he would probably be an ineffective councilmember.

And effectiveness is exactly what Jane Brunner offers. IZ wouldn’t have a chance if it were pushed by Nancy Nadel, but Jane Brunner knows how to work the system. For her constituents she’s delivered bicycle lanes and bike parking, the only successful Measure DD project (Studio One), and a dog park at Mosswood (which Ms. Nadel took credit for). Her staff is involved in the negotiations with CalTrans over the Caldecott Tunnel, which is entirely appropriate. She makes noises about Smart Growth and will deliver the MacArthur BART project, even if has taken fifteen years. Without an experienced opponent with a clear alternative vision, Jane Brunner deserves reelection.

City Council District Three: Sean Sullivan

This is easy. V-Smoothe wrote an excellent essay entitled Nancy Nadel Has to Go. Now., and I have little to add. Sean Sullivan has impressed many people with his well-organized, aggressive campaign and positive, detailed vision for the future of the District (I’m part of his campaign). Greg Hodge barely got on the ballot, and has run an invisible campaign that is short on specifics. Sean Sullivan offers energetic, hands-on leadership at exactly the time Oakland needs it most, and his record delivering a multimillion-dollar youth center and effective violence prevention programs is the experience City Hall needs. He is endorsed by Desley Brooks and Pat Kernighan, the two swing votes on the Council who are also the most junior. The ranks of newer councilmembers, not beholden to the old power structure, deserve more members.

City Council District Five: Ignacio de la Fuente

Ignacio is the best member of the Oakland City Council. He is the most respectful and attentive to public speakers, his staff are the most open to new ideas and new activists, and he has been there for public transit and Smart Growth every time. He attempted to lobby the MTC for an East Bay HSR alignment (but was thwarted by Nadel), which is perhaps the biggest single transit issue of the decade. Under his leadership, Fruitvale has become a charming, thriving district. In the mid-nineties, when I lived in Rockridge, nobody thought of going to Fruitvale for dinner or shopping. Now many people do, and the Transit Village is a model for the entire region. Jingletown exists because of Ignacio’s vision of reclaiming industrial land and creating access to the waterfront. Even if his leading opponent wasn’t an inexperienced businessman with a checkered past, Ignacio de la Fuente would deserve reelection.

City Council Seven: Larry Reid

Larry Reid is good. He stands up for what’s right, not what’s politically correct, like with plastic bags or industrial zoning. He does a great job attracting retail and residential development to his economically depressed district. I hear his constituent services aren’t very good, but I don’t see Clifford Gilmore offering anything better. Running a terrible campaign doesn’t help matters. This is a great example of the Guardian’s endorsements revealing themselves to be utterly irrational.

City Council At-large: Clinton Killian

This is a crowded field but honestly the choice wasn’t that hard. Charles Pine is one-note and wouldn’t be effective on the Council. Frank Rose is awesome but he gives so much to the community without being on the Council, so I don’t think he really brings much to this particular role. Kerry Hamill doesn’t bother to campaign downtown at all, is nowhere on transportation and development (though the big developers love her for some reason), has no credibility on the crime issue that she’s pushing, and says annoying things that are obviously political, like we need fewer political staff, even though she is political staff (she was Don Perata’s Chief of Staff and is now a Policy Analyst for BART). Rebecca Kaplan is appealingly energetic, and says a lot of the right things, but she doesn’t really have a track record of clear positions. I need to know more about her.

Clinton Killian, despite some minor business troubles years back, offers a great mix of experience for the City Council. He’s been on the AC Transit Board, the Planning Commission, and serves on the Paramount Board. His commitment to downtown, smart growth, transportation and the arts is unquestionable, and those are my priorities. I also appreciate how he brings together two often-squabbling sectors of the business community, the mainstream businesses and the ethnic businesses. His campaign has a clear message and is well-targeted, and he has a great shot at the runoff despite being outspent. That’s a good sign.

School Board District One: Brian Rogers

Who cares that he’s a Republican? At least he has something to say about education that’s relevant. Jody London, who just oozes politician, managed to squeeze green-collar jobs, energy independence and Save The Bay into the School Board debate, and said that she had no position on charter schools but is against them. Her entire campaign appears to be based around the fact that Mr. Rogers is a Republican. I think the race is pretty clear-cut: Rogers represents reform, London the status quo. She’s endorsed by the outgoing Boardmember, the Teachers’ Union and all the usual suspects. Brian Rogers supports educational innovation and charters, involvement from business, and continuing the Expect Success reforms opposed by Jody London and the Teachers’ Union.

AD 14: Tony Thurmond

I agree with the Express, the Chronicle and the Trib that the Richmond Councilmember is best to represent the district, rather than a Berkeley politician. His resume, running a successful nonprofit serving at-risk youth, reminds me of Sean Sullivan. Kris Worthington and Nancy Skinner are awful, the perfect embodiment of everything that’s wrong with the Berkeley City Council (NIMBYism meets Communism). I worry that Phil Polakoff will take too many moderate North Oakland / Berkeley votes and hand the race to Nancy Skinner, unfortunately. No runoffs in a partisan primary! But if you live in this district, which I don’t, please vote Tony Thurmond.

State Senate: Wilma Chan

Since we’re all getting two pieces of mail a day about Loni Hancock and Wilma Chan, many people may have made up their minds. I think the mail itself is a pretty good way to judge the candidates: Ms. Chan has a clear argument, that she accomplished more when she was in the Assembly than Ms. Hancock did (that’s true). Ms. Hancock, on the other hand, is all over the place, bragging about big-time endorsements one day and then bashing Wilma Chan for not having enough endorsements the next. Her mailers are full of stupid quotes like “the courage to lead” and dumb photos of her staring over the Berkeley Marina or talking to college students. Anyway, this one is easy: Wilma Chan represented Oakland and Alameda, Loni Hancock Berkeley and points north. Gotta go with the home team.

Predictions:

City Council: all the incumbents win outright except Nancy Nadel. Nadel may be bested by Sean Sullivan, who has reached out to people his opponents haven’t contacted, and seems to have the momentum heading into the final weekend when the undecideds are making up their minds. As for the at-large, Rebecca Kaplan will make the runoff with either Hamill or Killian in second place.

School Board: Incumbents in D5 and D7, Olu in D3 (Jumoke Hodge will do as poorly as her husband, because they didn’t campaign very much). There will probably be a runoff in D1, since Tennessee Reed has some name recognition and Rogers and London seem to be dueling it out pretty evenly. Rogers has a clear message so he could win, though I may be overestimating the voters’ willingness to overlook party registration.

Assembly: Thurmond could make it, otherwise Skinner. Polakoff’s base is too narrow but he’s probably done lots of mailers. Thurmond’s mailers contain typos but the demographics are on his side (everyone else is from Berkeley, he’s from the other half of the district).

State Senate: Wilma Chan will pull it off. The endorsements Hancock’s touting aren’t going to matter all that much, since Ms. Chan has great name recognition. Ms. Hancock is a divisive figure in her own Assembly district, so she can’t count on her half of the Senate district serving as a base. Chan’s mailers have a clearer message, as I said before, and so are more effective. I guess we’ll see on June Third!

As the elections come closer, voters are deluged with mailers and get many calls from politicians and volunteers seeking their support. Candidates and their literature trumpet endorsements, which the organizations issuing find very important. Endorsements are thought to be representative of the various interests that make up the endorsing groups. Curiously, the County Central Democrat Committee, Alameda County Sierra Club, San Francisco Bay Guardian, Central Labor Council had strikingly similar endorsements: Rebecca Kaplan for at-large, Jane Brunner and Nancy Nadel for reelection, and against Ignacio de la Fuente and Reid for their own reelections. Given the supposed influence of incumbents, particularly the Council President, it’s unexpected that supposedly establishment organizations are joining many issue-oriented or simply rebellious voices to produce what can be termed a slate.

All of these endorsements are contradictory. Let’s look at blogger bete noire Nancy Nadel and her endorsements, which she trumpeted in a recent colorful mailer. She has the endorsement of the Bay Guardian, which looked like she wrote it (no journalist could be out-of-it enough to believe she’s a hard worker). The Guardian, as a supposedly youthful voice, consistently stands up for artists and musicians. Yet Nancy Nadel called the cops on the Art Murmur, shut down a dancehall concert and attempted to kick artists out of live/work in industrial West Oakland. Without mentioning her Gen X competitor, homeless shelter director Sean Sullivan, the Guardian stood on the wrong side of their carefully-cultivated generation gap. This also goes for the East Bay Young Democrats.

The Sierra Club’s endorsements were also bizarre, and not just regarding District 3. Nadel is attempting to limit transit-oriented development in the DTO, held up the City Council’s endorsement of the more environmentally-friendly Altamont Pass bullet-train route, and is nowhere on Bus Rapid Transit (and stood by idly as the Broadway Shopper Shuttle was ended in 2003). She did author the plastic bag ordinance but it was struck down in court, which isn’t very impressive. Ignacio de la Fuente has been an outspoken voice on transit and transit-oriented development, and he and Larry Reid have been the city’s most successful creators of new urban open space. Jane Brunner is also nowhere on transit, considers Transit-Oriented Development to be only government-sponsored mid-rise developments immediately adjacent to BART stations, and I can’t think of anything she’s done that seems very green.

The Central Labor Council endorsed Nadel for the first time, and declined to endorse Ignacio even though he is vice-president of a union, author of Oakland’s Living Wage and Local Hire ordinances, and reportedly did very well in their interview. The Alameda County Democratic Party declined to endorse incumbent de la Fuente, and gave Green-turned-Democrat Rebecca Kaplan the endorsement over longtime elected Democrats Clinton Killian and Kerry Hammill. The teachers’ union, Green Party, and ACORN also followed the slate, though without an interview process.

The Central Democratic Committee endorsements can be partly explained because the current committeemembers were elected when Dellums was elected mayor, so were part of his slate and therefore enemies of Ignacio. But Nadel has always voted for Ignacio for Council President, and Sean Sullivan had an early endorser in Desley Brooks (and is endorsed by Kathy Neal of the DCCC and Mario Juarez’s campaign). The Sierra Club didn’t give Sullivan an interview, explaining that they routinely endorse incumbents they’ve worked with before. But they had an interview in D5. Many of the Guardian’s endorsements were entirely out-to-lunch, but they certainly got the memo Brunner and Nadel should be reelected, Ignacio and Reid unseated, and Kaplan elected. If internal Council President politics don’t explain it, and it doesn’t fit with the agendas of the endorsing groups, what else is left?

Misplaced ideology is the common thread that links this slate. Though most Council business is conducted unanimously, and there is a strong consensus in Oakland over the general outlines of the future of the city, there have been a few policies that have split the Council and possibly the electorate. The main issue is Inclusionary Zoning, which the Council deadlocked on way back in October 2006. Mario Juarez, despite being a realtor and former ally of Ignacio de la Fuente, now supports a 25% mandatory set-aside. Nancy Nadel (and Jean Quan who is campaigning for her) keeps trying to bring up IZ, to little apparent success, and she also said last week people should vote for Rebecca Kaplan because she supports IZ (though I don’t really get that impression).

Beyond IZ, many of these groups are made up of non-Oaklanders (like the DCCC, East Bay Young Democrats, the Guardian, and the Sierra Club) or are dominated by the public-employee unions (the OEA teachers’ union, the County Central Labor Council, and arguably ACORN because they get a lot of help from EBASE). The unions want compliant councilmembers, and out-of-towners are easily swayed by ideology and abstract issues like IZ and don’t know anything about blight and food access.

I agree with the “slate” choices regarding the reelection of the four sitting Councilmembers. At least, I agree that Ignacio de la Fuente and Larry Reid stand for something different than Jane Brunner and Nancy Nadel. I outlined above how many of the endorsements, particularly the East Bay Young Democrats and Sierra Club, are counter to what the groups ostensibly represent. This election is a particularly good example of why it’s important for voters to make informed judgments for themselves. An environmentalist could mistakenly think that the Sierra Club’s endorsements have something to do with a politician’s ideas and track record on the environment, or a hipster could assume the East Bay Young Democrats are a proxy for forward-thinking and youth-friendly leadership. That would be entirely wrong.

Transportation and land use are intimately linked. The combination of better public transportation and transit-oriented development is the Bay Area’s best hope for reducing the pollution, congestion, and related problems associated with the region’s over-dependence on the private automobile. Yet, instead of leading the way, Berkeley, in the form of a relatively small group of activist neighbors, is fighting the trend vigorously.

This Tuesday, April 22, the Berkeley City Council will vote on a proposal that would significantly downzone the major transportation corridors. Essentially that proposal is exactly the same as Measure P, which 80 percent of Berkeley’s voters defeated in 2002.

I followed Berkeley’s protracted zoning-by-committee Downtown Plan process and always check the Berkeley Daily Planet, which seems to be that city’s only news source, but had never heard of any downzoning effort. Why would the Berkeley Daily refrain from applauding neighbors’ efforts to keep newcomers out with restrictive land-use policies? Then I remembered an ongoing and rather odd discussion of a density bonus that comes to the Berkeley City Council today:

Two different versions of a proposed municipal density bonus are on the council’s agenda, one recommended by the Planning Commission and the other by the city planning staff.

The regulations would govern the size and shape of multi-story mixed-use housing projects of the sort now being built along the city’s major traffic arteries.

The commission is urging the city to pass an ordinance that will take effect before the June 3 general election to offset the possible impacts of Proposition 98.

In Oakland, there has been a little discussion of density bonuses, which are available to developers who include price-restricted (“affordable”) units in residential projects by state law. The density bonus functions as a voluntary Inclusionary Zoning program, similar to Los Angeles or Massachusetts though much less used (one project in Temescal is applying for it; I don’t know of any other use of this ten-year-old law in Oakland). Desley Brooks specifically directed the Blue Ribbon Commission to look at density bonuses as they attempted to draft an affordable-housing ordinance, but of course the commission did not, and IZ advocates ignore the density bonuses that would be consequence of their proposal. As a result, few people understand that once cities adopt mandatory IZ regulations, they lose some control over development, which prevents municipalities from adopting IZ just to discourage development.

It appears that Berkeley’s planning staff is adept at using the state’s density bonus to move projects past a skeptical Zoning Adjustments Board and Planning Commission hearings dominated by outraged NIMBYs. Having caught on to the ruse, the ZAB has been for some time asking for an ordinance that allows them to limit development further. Much like Jane Brunner tried to pass a poorly-thought-out IZ ordinance before Prop 90 came to a vote in late 2006, it appears the Berkeley City Council is sufficiently cowed by the spectre of Prop 98, and will radically downzone their transit corridors in order to assure that Berkeley’s future development includes price-restricted units, and that there will be few of them.

In related news, it appears that State Senate candidate Loni Hancock (former “progressive” Mayor of Berkeley, current Assemblymember, wife of Tom “I stole the newspaper” Bates) is carrying some significant legislation to further placate NIMBYs who love affordable housing in theory. According to the Planet (I couldn’t find this bill), Hancock has introduced a bill that would exempt cities with IZ from the statewide Density Bonus without forcing them to create their own bonuses, thereby encouraging cities to pass the sort of IZ ordinances a recent pro-IZ study found to be the least effective: mandatory, unfunded policies without planning concessions. Politicians like Loni Hancock, Tom Bates and, in Oakland, Jane Brunner and Nancy Nadel advance a damaging anti-growth agenda under the auspices of providing more affordable housing, and inevitably their targets are transit corridors and other places that make growth smart. BRT proponents and other environmentalists are wise to connect the dots.

At the Community and Economic Development Committee, the Council was treated to the unpleasant spectacle of sharp disagreements over the city’s proposal to construct affordable housing next to Raimondi Park. The city staff and West Oakland residents supported the family-sized homeownership units aimed at households making around 60% of the Area Median Income. Several One non-profit housing developers strenuously objected, arguing that the city should somehow force the Central Station master developer to transfer a plot of land for free, and that more of the units be aimed at 100% AMI households (making up to $82k/yr), since that’s easier for them to develop.

Chair Jane Brunner told the nonprofits that if they wanted to set-aside land for subsidized housing, that should have happened years ago when the master plan was approved. She then speculated that subsidized housing units should be sprinkled within market-rate developments, “so you couldn’t tell which was which.” While I love her socialist idealism, it’s incredibly inefficient to do that. First, subsidized developers should take advantage of cost-saving measures that may not be available to market-rate developers, like low-quality finishes or less parking, since that helps lower the cost of housing. Second, land costs are a huge factor in housing prices. It makes sense to use lower-value sites for subsidized housing, and to allow more density for subsidized units. Both of these measures lower the relative cost of land as a portion of housing costs. Third, the press has reported a lot recently on how owners of BMR units can face steep condo fees since their incomes don’t match those of their neighbors. Luxury buildings should be able to have luxury amenities, and it doesn’t make sense to place people in those buildings if they can’t afford the upkeep. However, I wouldn’t be surprised if there’s another attempt to socialize the housing market early next year.

Because of the overly-long meeting, a periodic report (PDF) on the progress of the city’s redevelopment areas (it did not include the largest RDA, Central City East) was put off until the Council meeting next week. Overall, while the report provided valuable information on the collection and disposition of revenues, there were not detailed charts on affordable housing production or spending for every redevelopment area. While large amounts of money are being generated for housing subsidies, there’s not a direct explanation of where all of that money is going. However, it’s clear that downtown is doing very well, and almost every redevelopment area is meeting its goals and exceeding its revenue projections. While many say the city having some problems meeting its debt obligations, that was not clear from the charts, which showed all of the areas in the black.

The standout redevelopment areas included the Coliseum RDA (which is lower East Oakland from Fruitvale to San Leandro), which strongly outperformed in affordable housing production, with the vast majority of the units aimed at “Very Low Income” households. On the other hand, the Broadway / MacArthur / San Pablo RDA has not produced any affordable housing in its seven years of existence, despite being the pet agency of supposed affordable-housing champion Jane Brunner. The only planned subsidized housing is in the MacArthur BART transit village, which is taking forever and consuming huge amounts of money. The RDA is also cash-poor, so even though 52% of the Conley Report proposal area is in that RDA, Ms. Brunner is very unhappy about contributing to the Specific Plan for retail development.

Downtown (Central District), of course, had the most projects and programs ongoing. $29.7m was set-aside for affordable housing in the last three fiscal years, 568 affordable units were constructed, and $4m was transferred to schools and other agencies (also, the state stole $5.1m to balance the budget). Even though downtown has experienced recent losses of parking spaces, revenue for the city-owned parking garage in the UCOP fell 13%. Of $66.5m spent on projects, $51.9m went to the Uptown district, primarily to Forest City and the Fox Theater. Though the majority of the Tax Increment Funds (TIF) was spent on debt service, there was more than that amount available from bond funds. More stats on downtown at The DTO.

The Stanford-Adeline RDA is winding down, and Oak Center will expire next year, with no more TIF. Some folks, like the ORPN, want to see a rollback of redevelopment areas. It seems that many of the RDA boundaries are arbitrary, and that perhaps the last remaining inner West Oakland RDA could expire along with its neighbor Oak Center. But it is important to have the ability to capture and set-aside revenues from development for specific purposes, which could include public safety. And it’s not like the problem with the police is a lack of General Fund revenue! Without clear priorities and set-asides, the bureaucracy will just eat it all up. Of the redevelopment funds reported in the last three fiscal years, $29.2m went to personnel.

The large sum generated by a bond could jumpstart rehabilitation programs like those I discussed yesterday, and provide funds to purchase vacant lots or abandoned buildings, which could then be conveyed to affordable or market-rate developers. Alternatively, the long-term funding provided by the bond could go to programs like downpayment or first/last month’s payment assistance, as Just Cause asked in the last budget cycle. The bond should not be used to construct new housing, simply because it’s too expensive and the bond will not last forever. Also, it’s likely that new housing constructed by non-profit developers would be BMR condos, which provide very little value to the community and are only technically “affordable.” Because the bond is paid by existing residents, the funds should go to helping existing residents, not building median-income condos that will most likely be purchased by new residents.

There are many challenges facing floating a housing bond. First and foremost, it requires a 2/3s vote. In Los Angeles, where the debate over the city’s housing shortage is much more advanced than our own (because there is a strong consensus that the problem is lack of housing, not housing costs or “gentrification”), a housing bond failed narrowly in November 2006. Other challenges include the possibility that IZ activists will try to hijack the bond so that it goes to subsidizing non-profit developers instead of helping the poor. Finally, a careful campaign will have to persuade Oaklanders that low-income housing assistance will not lead to more run-down OHA units in their neighborhoods (thus the emphasis on rehabilitation and purchasing abandoned land). But these challenges are not insurmountable. Rather than trying to stick market-rate developers and their customers with outrageous fees and mandates, all Oaklanders should share in the responsibility to provide housing for the poor, through a progressively-funded bond.

First and foremost, Inclusionary Zoning policies strongly discourage housing construction. By being forced to give part of their units away below-cost, developers are subject to an implied tax that reduces their capital investment. Other uses of expensive land become relatively more profitable when housing is singled out for price controls, and developers lose their incentive to construct as much housing as possible (eg, if the IZ fee threshold is set at 20 units, we’ll see a lot of 19-unit buildings). There is a strong statistical relationship between IZ price controls and plummeting housing construction – check out Berkeley. Since they adopted strict IZ in 2000, there have been only eight condo units built. Because most of our affordable-housing dollars depend on taxes paid by new construction, a slowdown would jeopardize those funds.

Second, IZ targets exactly the wrong people to pay for “affordable” housing. The median price of a single-family home in Oakland is over $600,000, but most newly-built condos in Oakland cost between $400k and $500k. Ultimately, the owners of new condos have to pay for IZ, because developers will pass the costs on. Transit-oriented development for middle-class people will suffer, while people living in new mansions in the Hills or existing single-family homes aren’t asked to contribute a dime. Because IZ requires more units to be built for developers to capture the same profit, it is likely that IZ will lead to even more conflicts with neighbors over density, further delaying projects and increasing housing costs. Neighbors may also resent having to compete with subsidized units when reselling their own homes. Also, because the “affordable” units can be available to people making over $90k/year (more than what almost everyone in my market-rate condo complex makes), it is likely that market-rate homeowners making less money will subsidize the “affordable” homeowners, which is deeply regressive. If that’s not true, and there is a large gap between incomes within a condo complex subject to IZ, condo fees will be burdensome to the poorer residents.

Third, the end result of Inclusionary Zoning is of dubious value. The “affordable” units, usually called Below Market Rate (BMR), are price-restricted for 45 years or more, usually enforced by requiring the condo buyers to sell their units back to a non-profit developer at a fixed price. While the non-profit gets to hold units using their customers’ capital, the condo owners are limited in the appreciation they can capture. It is not homeownership, because the non-profit developer is the real owner. SF’s experience suggests that minority groups are less likely than whites to take advantage of the programs because they are more fearful of being exploited by the non-profit owners of the units. Using other sources of city housing funds to subsidize BMR units (like downpayment assistance) will further concentrate city housing funds in the hands of non-profit developers, while real homeownership opportunities are lost. Also, as with all price controls, there are strong incentives to game the system. In San Diego and Irvine, illegal resale or rerental of BMR units has been rampant.

This is only a quick primer on IZ. This series of blogs seeks to suggest other opportunities. The non-profit developers desperate for IZ, which to them represents a riskless and permanent source of housing units to control, are uninterested in any housing solutions that do not benefit them (like Section 8). The City Council members that are most interested in affordable housing are seemingly in thrall to the non-profits, while the largest for-profit developers already include subsidized units in their projects and so have no real incentive to fight IZ. Small-time developers, though, have little political clout, and of course there is nobody to speak for future residents. To maximize transit-oriented development, neighborhood revitalization, and city tax revenue, and to meet both market-rate and low-income housing demand, new ideas and solutions that encourage housing are vitally necessary.

Bibliography:

Non-profit developers’ study of IZ in California.

Economists’ study of IZ in the Bay Area.

Blue Ribbon Commission page, including loads of reference material.

Before Oakland can look at all sorts of sexy and lucrative proposals for this site, the staff has to create documents that will inform potential developers about the cost, constraints, and context of the site, a process called RFP. Fox Theater developer Phil Tagami, a member of the former Base Reuse Authority, stressed the importance of providing thorough documentation in a centralized, accessible place, and also suggested the RFP include the Port’s reuse plans. Nancy Nadel asked the council to have a Closed Session discussion to determine how the cost of the site will be presented. The city could buy OaklandArmyBaseRFP.com to provide information. I’m particularly curious to examine the already-completed EIR; if proposals can abide by its vision, reuse would be greatly eased.

Perhaps because expectations have been lowered, city leaders and interest groups strongly agree on a basic overall approach focused on maritime support, including a willingness to work with the market and hasten delivery. A complicating factor for this land is that it’s raw and in Oakland, but not really infill. There are limited transit possibilities, and no real opportunities for spillover economic benefit to West Oakland from office or retail development. As proponents of BRT, Central Waterfront, and Temescal projects point out, there are two sides to Smart Growth: limiting greenfield sprawl, and building up inner-city sites. The broad agreement that this isolated site is most appropriately used for dirty, noisy, and transportation purposes reflects a sophisticated understanding of Smart Growth on the part of both the City Council and, more importantly, local interest groups. Now if only Stuart Flashman would realize that stopping sprawl along the Pacheco Pass would be eased by permitting development in North Oakland!

By rejecting all of the consultant’s four reuse concepts, the City Council explicitly asked to see market-driven, project-specific proposals. The discussion began with Councilmembers Nadel and de la Fuente endorsing Eco-Oakland, but ended with a motion for the broadest RFQ/RFP. This decision rejects Mayor Dellums’ recent statement publicly endorsing the “Mixed-Use Oakland” scheme, when he said that we shouldn’t plan project-by-project. Though I personally favor Henry Chang’s take-the-money-and-run plan to sell the whole thing to the Port, a superb due-diligence package, distributed internationally, could result in some “spectacular” proposals.