2010-03-16 Joint CC ARRA CIC MinutesMINUTES OF THE SPECIAL JOINT CITY COUNCIL, ALAMEDA REUSE
AND REDEVELOPMENT AUTHORITY (ARRA) AND COMMUNITY
IMPROVEMENT COMMISSION (CIC) MEETING
TUESDAY- -MARCH 16, 2010- -7:01 P.M.
Mayor /Chair Johnson convened the meeting at 1:44 a.m. on March 17, 2010.
ROLL CALL - Present: Councilmembers / Board Members / Commissioners
deHaan, Gilmore, Matarrese, Tam and Mayor /Chair
Johnson —5.
Absent: None.
MINI ITFO,
(10 -13 CIC) Minutes of the Special CIC Meeting Held on March 3, 2010. Approved.
Commissioner Matarrese moved approval of the minutes.
Commissioner deHaan seconded the motion, which carried by unanimous voice vote — 5.
AGENDA ITEM
(10 -129 CC /ARRA/10 -14 CIC) Consider SunCal's Requests for 60 -Day Tolling Period
regarding Notice of Default Issued by Alameda on February 4, 2010.
The Deputy City Manager — Development Services gave a brief presentation.
Councilmember /Board Member /Commissioner Tam inquired what section of the Executive
Negotiating Agreement (ENA) explicitly uses the terms "Measure A" and "Measure A
Compliant ".
The City Attorney /Legal Counsel responded no such terms are used; stated an
interpretation suggests the terms; under the ENA, the developer had a chance to submit
an initiative for a non - Measure A compliant plan; the initiative failed; under the terms of the
ENA, SunCal is permitted to submit an Optional Entitlement Application (OEA) which
complies with existing law, which in this case is Measure A; regardless of the fact that the
ENA does not say "Measure A ", that is the interpretation.
Councilmember /Board Member /Commissioner Tam stated the City found SunCal in default
because the OEA is not consistent with existing law; requested an interpretation of Section
3.2.5.1 of the ENA.
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Reuse and Redevelopment Authority, and 1
Community Improvement Commission
March 16, 2010
The City Attorney /Legal Counsel responded the issue tonight is whether or not to agree to
a 60 -day tolling period.
Councilmember /Board Member /Commissioner Tam stated that she is trying to understand
the reason for the tolling period request and whether there is an ability on the part of the
City's partner to cure the deemed default her understanding of Section 3.2.5.1 is that the
developer shall use best efforts to submit all required supplemental information sufficient
for the entitlement application to promptly be deemed complete by Alameda; inquired
whether the City deemed the application incomplete.
The City Attorney /Legal Counsel responded the Notice of Default sets forth the analysis
and reasoning; stated SunCal can be asked whether they feel capable of curing by the
deadline; the City's position is that SunCal is clearly capable of curing; the Notice of
Default is very specific about the problem with the OEA and what needs to be done to be
in compliant with existing law.
Councilmember /Board Member /Commissioner Tam stated the ENA states that the
developer may include: General Plan amendments, Zoning amendments to the MX Mixed
Use zoning, and other entitlements and approvals the developer may request for the
project site; inquired whether said action has occurred.
The Planning Services Manager responded the OEA includes a submittal for a MX
amendment and specific plan for the site; stated neither submittal can be processed under
the current City Charter and would require another initiative.
Councilmember /Board Member /Commissioner Tam inquired whether the submittals cannot
be processed because of non - compliance with the Charter provisions or because the
submittals do not include a request to deal with some General Plan and Zoning
amendments or other entitlements including the Density Bonus Ordinance passed in
December.
The Planning Services Manager responded General Plan, Rezoning, and Master Plan
amendments were included; stated the problem is that the submittals cannot be processed
because of inconsistency with the City Charter.
The Deputy City Manager — Development Services stated that ENA does not allow for a
second initiative.
Councilmember /Board Member /Commissioner Tam inquired what is the typical process
that the Community Development Department goes through when reviewing and
considering non Measure A Compliant submittals; referenced the Francis Collins' project.
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March 16, 2010
The Planning Services Manager responded the Collins project requested a density bonus;
stated a Measure A compliant plan was submitted and was denied; a second submittal was
a Measure A compliant plan and included more units than allowed under Measure A
because it would be eligible for certain [density bonus] waivers, which is not what SunCal
submitted.
Councilmember /Board Member /Commissioner Tam inquired whether staff has worked with
SunCal since the OEA was submitted on March 14 to determine whether there is a way to
be in compliance rather than providing a brand new submittal.
The Planning Services Manager responded staff cannot process a non Measure A project;
stated an initiative is the only way to get the project approved; staff has met with SunCal
many times and has explained the deficiency in the submittal; the Notice of Default is
specific regarding some of the deficiencies; the current Density Bonus Ordinance is a
bonus above either the Zoning or General Plan designation for the site.
The Deputy City Manager — Development Services stated the SunCal submittal does not
include a density bonus application.
Councilmember /Board Member /Commissioner Tam inquired whether SunCal has the
opportunity to submit a density bonus application, to which the Deputy City Manager —
Development Services responded SunCal has been advised that they would need to
submit a base project that is Measure A compliant and then submit a density bonus
application that is consistent with the Density Bonus Ordinance.
Councilmember /Board Member /Commissioner Tam inquired who makes the determination
on whether the Density Bonus Ordinance is applied appropriately.
The Deputy City Manager— Development Services responded an interdepartmental team
would review the matter.
Councilmember /Board Member /Commissioner Tam inquired whether the matter would
come to the Council /Board /Commission at any time, to which the Interim City Manager/
Interim Executive Director responded the process is administrative.
Speakers: Janet Gibson, Alameda; Andeas Cluver, Alameda County Building Trades
Council; Andrew Slivka, Carpenters Union Local 713 and Alameda resident; Frank Faye,
SunCal; Jim Sweeney, Alameda; Jean Sweeney, Alameda; Gretchen Lipow, Alameda;
Ashley Jones, Alameda; Dorothy Freeman, Alameda; Rosemary McNally, Alameda; and
Karen Bay, Alameda.
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Mr. Faye stated that SunCal came to tonight's meeting in good faith and is trying to create
positives; the ENA term runs through July; SunCal's intent is to move forward in a positive,
transparent manner; SunCal has entered into a project labor agreement with organized
labor; SunCal had hoped to use the tolling period to continue to expand the outreach of
support; SunCal is prepared to lift the confidentiality under the ENA and believes that
transparency is a good idea; SunCal will submit the OEA on time and will send a letter of
reservation with the application; the deadline will be met; that he withdraws the requestfor
the 60 -day tolling period because Council wants to review the plan; SunCal has spent over
$100,000 in order to meet the deadline to submit a meaningful application; SunCal had
hoped to submit the application without a reservation letter; SunCal looks forward to a
completely transparent process
Councilmember /Board Member /Commissioner Gilmore inquired when transparency would
start and what type of documents would be released.
Mr. Faye responded confidentiality provisions would be lifted immediately; stated the only
exception would be business terms between SunCal and D. E. Shaw, which are proprietary
and SunCal's underwriting, which is proprietary; all information going into creating the
project performa would be transparent.
Councilmember /Board Member /Commissioner Gilmore stated residents had many
questions regarding the financials and whether or not things would pencil out; that she
would like to start with releasing the financials so that the public can pour through
information and draw conclusions.
Mr. Faye stated SunCal is committed to the transparent process; SunCal loaned an
underwriter to the City for stress models; SunCal has nothing to hide; the information flow
was imperfect; that he withdraws the request for the 60 -day tolling period so that no action
is needed tonight; the Council /Board Members /Commissioners should meet with SunCal
as soon as OEA corrections are submitted; SunCal has rebuilt part of its team; the new
partners in labor are going to surprise the Council /Board Members /Commissioners.
Vice Mayor /Board Member /Commissioner deHaan stated a year ago, SunCal started going
down a contentious avenue and moved on to a situation where the election was deferred;
the election could have occurred in November of last year; the City has been in the [ENA]
agreement for three years; the initiative was very trying and became a campaign with a
different approach; when SunCal lost its financial partner, the Council /Board
Members /Commissioners extended the agreement for eight months; another extension was
given for the initiative; the process has been prolonged; an 85% [voters against initiative]
outcome is unknown in preceding elections; that he commends SunCal for the effort to
make nice with the union; SunCal has not talked with other stakeholders; SunCal is coming
from a position of distrust within the community by its own choosing; that he does not see
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March 16, 2010
any humbleness.
Mr. Faye stated that he has addressed the Council /Board Members /Commissioners
because of the enormity of the situation; lifting the transparency will help everyone to avoid
the misunderstanding; SunCal has an obligation to submit a transparent plan and looks
forward to meeting the upcoming deadline as presented; rights will be reserved in a letter.
Vice Mayor /Board Member /Commissioner deHaan stated SunCal spent $1,250,000 on the
campaign; the community had to take on a poorly written initiative; that he hopes the
community will never see a similar situation again; money seems to be more important
than good will.
Mr. Faye stated that is not SunCal's intent; SunCal has paid between $10 and $12 million
on the project and has tried to be a good partner with the City; SunCal and D.E. Shaw are
still willing and able to make contributions; most sponsors are gone, lenders are not giving
land loans, and most equity partners are not putting out money.
Councilmember /Board Member /Commissioner Tam stated SunCal's proposal is to meet
the deadline and submit an OEA by March 22, 2010 which can be processed by staff; that
she does not understand how the process interplays with Council; inquired what is the best
way to maximize opportunity for transparency.
The City Attorney /Legal Council responded the process would be the same as for any
development plan or submittal for entitlement; stated staff will review the matter, which will
be forwarded on to the Planning Board once it is considered complete.
Mr. Faye stated in the past, Council has formed a sub - committee to accompany staff in
meetings to help develop a consensus; SunCal would love to have the opportunity to
present responses and ideas directly to the Council /Board Members /Commissioners in an
appropriate forum.
Councilmember /Board Member /Commissioner Gilmore inquired whether a factual
description could be published on the new submittal so that the community is informed;
stated residents were interested and curious regarding the January 14th submittal.
The City Attorney /Legal Council responded the submittal would be a public record.
Councilmember /Board Member /Commissioner Tam inquired whether the submittal could
be summarized and presented at a Council meeting.
Vice Mayor /Board Member /Commission deHaan inquired whether an executive summary
would be included.
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March 16, 2010
Mr. Faye responded that he is not sure whether an executive summary is required but
would be happy to provide one.
Councilmember /Board Member /Commissioner Tam stated an update could be provided
under City Manager Communications.
The Interim City Manager /Interim Executive Director responded information would be
provided at the April 6 Council Meeting.
Councilmember /Board Member /Commissioner Matarrese stated the document would be
public when submitted on March 22 "d
The Interim City Manager /Interim Executive Director requested that Mr. Faye introduce
new team members.
Mr. Faye stated Robert Hertzberg has joined SunCal and will provide an additional set of
eyes; that he [Mr. Faye] is a partner and will be at every hearing; that he withdraws the
request for the 60 -day tolling period; a project would be submitted by the deadline; stated
SunCal would lift confidentiality requirements in the ENA with exceptions.
ADJOURNMENT
There being no further business, Mayor /Chair Johnson adjourned the meeting at 2:54 a.m.
Respectfully submitted,
Lara Weisiger
City Clerk
The agenda for this meeting was posted in accordance with the Brown Act.
Special Joint Meeting
Alameda City Council, Alameda
Reuse and Redevelopment Authority, and 6
Community Improvement Commission
March 16, 2010