UPDATED Matarrese drops support for SunCal initiative
Updated 6:45 a.m. Wednesday, October 28
Citing financial concerns that have emerged since he endorsed it in May, Councilman Frank Matarrese has dropped his support of SunCal’s ballot initiative that spells out its development plans for Alameda Point.
Matarrese said he still supports SunCal’s land plan for the Point. But he said that the financial underpinnings of the development agreement on the ballot have fallen apart over the last several months.
He said the $200 million cap on what the developer must pay for public benefits for the project, the state’s taking of millions of dollars in redevelopment money that would have been used to help obtain public bonds to help finance it and the Obama Administration’s announcement that it will not back no-cost transfer of former military properties slated for local development contributed to his change of heart.
He also said that there is no guarantee that side agreements SunCal’s reps have promised to make will be legally enforceable or protect the city financially. City Attorney Teresa Highsmith told a reporter last week that it’s not clear whether such agreements would trump items on the ballot that they conflict with.
“We’re going to be left holding the bag, and with no way to pay for it,” he said, adding that recent, staff-generated estimates showed public benefit cost overruns of at least $30 million.
He also said the company has not signed a labor agreement with local trade unions.
Mayor Beverly Johnson announced that she was dropping support for the initiative on October 14, saying she was persuaded to do so by a city-issued report laying out potential challenges the initiative posed in May. Several groups, including the Alameda Chamber of Commerce, have said in recent weeks that while they like SunCal’s plan, they cannot support the initiative.
Matarrese’s announcement means that a majority of the council opposes the initiative outright, and not a single council member now holds a position in favor of it. Vice Mayor Doug deHaan has said he doesn’t support the initiative or the plan.
Councilwoman Lena Tam has said she supports the plan and residents’ right to vote on it, but has not taken a position on the initiative. Councilwoman Marie Gilmore does not appear to have taken a public position on the plan or the ballot measure.
A SunCal rep, who said he didn’t know about Matarrese’s announcement until a reporter called, had not responded to a request for comment by Tuesday evening.
Matarrese said that voters need to know about the issues the initiative could pose before they head to the polls. The council is set to place the initiative on the ballot at its November 3 meeting. Johnson also asked for a staff presentation and update of the initiative reports authored by staff, and council members asked that SunCal make public financial and other information they have kept confidential.
If the initiative fails, he said SunCal could propose a Measure A compliant plan, though he acknowledged such a plan is not financially feasible. He said the city could also negotiate directly with the Navy for transfer of the land if the exclusive negotiating agreement the city has with SunCal lapses without any further agreement. “We’ve got a very long history of communication with the Navy,” Matarrese said.
City and SunCal staff are meeting weekly to negotiate a disposition and development agreement, the next step in the development process. City staff have declined to characterize the success of the negotiations. The negotiating agreement terminates in July.
SunCal’s plan includes 4,841 homes, 3.2 million square feet of commercial space, 350,000 square feet of retail, adaptive reuse of certain historic buildings, 145 acres of parks, schools, a library and more.