OAKLAND – City negotiators and Oakland A’s haven’t agreed on several financial terms for the proposed Howard Terminal ballpark and the team’s mixed-use development, but city officials have recommended the city council approve a draft agreement next week and to continue negotiations with The crew.
This comes from a city report released the Friday ahead of Tuesday’s meeting, where the city council is expected to decide whether to approve the draft terms and instruct staff to keep talking to the A’s.
The proposed project would include a new ballpark with a capacity of 35,000 people, up to 3,000 residential units, 1.5 million square feet of office space, 270,000 square feet of mixed retail space, as well as a 3,500-seat theater, 400 hotel rooms, and approximately 18 acres of parks and open spaces.
While city officials believe the development – as recorded in an employee memo – “has the potential to accelerate the long-needed infrastructure and traffic improvements that will enable people to move safely on and around the waterfront and to protect the economic engine of the seaport, expand the tax base of the city and county and achieve fair jobs, housing and other direct benefits for the community ”, there are still big points of contention between the A’s and the city as to whether the team as the developer of the project should be required to provide a certain amount of affordable housing and to fund the necessary infrastructure around the Howard Terminal site on which the project is located.
City officials have outlined terms that would require 30% housing affordability, including providing some of the homes on the site and paying for affordable housing to be built in nearby neighborhoods.
City and state laws require housing developers to include affordable units or pay fees to build affordable housing elsewhere. The A asked the city to waive these two requirements.
Instead, the A’s have suggested that the city use the millions of dollars in additional revenue it would generate by creating special two tax districts to finance affordable housing elsewhere and the infrastructure needed for the project – such as roads, sidewalks, and footbridges – to pay.
“There are affordability laws in place, but we believe the money we spend more than makes up for those dollars,” said team president Dave Kaval in an interview this week.
Other ballpark complexes differ in the amount of public aid received, and cities have grappled with balancing financial aid, whether in the form of tax breaks, the use of public land, or even funding for construction costs. It has been widely reported that the San Francisco Giants’ privately funded ballpark, which was built two decades ago, received a relatively modest $ 15 million in public funding that was used to relocate a public transit stop. A Harvard urban planner estimated the public cost at $ 143 million, including $ 33 million in donated land to the city, plus $ 25 million for urban services such as garbage, police and fire services, and $ 83 million of property tax exemptions.
Housing and development around this ballpark is an ongoing project, and in a worsening housing crisis, the team and development partner Tishman Speyer plan to mark 40% of the homes in Mission Rock Development as affordable.
That’s more than Oakland would ask, but the A’s argue that it is unnecessary and that their project will fuel economic development that creates tax growth that would otherwise not exist.
Deputy City Administrator Betsy Lake said at an earlier public meeting that this could be the case for the Howard Terminal financial district, which is largely undeveloped and does not bring much tax revenue to the city. But the creation of a second tax district, as suggested by the A’s, for a mile and a half section of the Jack London Square area does not appear to be “fiscally responsible”.
There are already businesses and homes whose appraised property values have increased in the area, so it’s virtually “unimaginable” how much the A’s development would add to surrounding businesses in terms of tax growth, as opposed to the Howard Terminal location itself .
The city would like the team to contribute to a “community fund” that could finance certain community services such as workforce development and affordable housing.
The Oakland community leaders want it too.
One area where the team and the city seem closer to an agreement than before is the non-relocation agreement. At a meeting earlier this month, Team President Dave Kaval said the team would not commit to staying in Oakland for more than 20 years when the city wanted 45 years. Kaval told this news agency this week that the team would agree to stay for 30 years, and the employee report released on Friday suggests “at least 25 years,” plus an agreement to pay the difference on any outstanding public debt that hasn’t yet were paid by the project – tax increase generated.
Even if the Council approves the draft treaty on Tuesday, the project is far from over. The city council cannot enter into a development agreement until it approves the environmental impact report later this year or early next year.
The A’s could also reject the conditions offered by the city and withdraw the proposal. Kaval has claimed – with many “Howard Terminal or Bust” shouts – that if the city council does not share the team’s “vision” for Howard Terminal and agrees to an agreement, the team will leave for another city.
At the top of the list so far was Las Vegas. Kaval has called the search for a stadium area there a “parallel path” to the discussions in Oakland. He and the team leaders have visited Las Vegas several times and plan to go to Oakland next week after the vote.