September 11, 2012 – Council Meeting
Summary from the Gallery
Urban Ore loan restructuring approved
Iceland: ZAB appeal upheld. Sports Basement use permit granted
Measure GG Fund allocation for 2013: Will be addressed in greater detail with the Disaster and Fire Safety Commission on October 2.
Item #9 URBAN ORE LOAN AMENDMENT (moved from Consent)
There is an outstanding $200K loan relating to the relocation from 6th and Gilman to 7th and Ashby. City incubated their business. As part of processing of these loans money was not amortized by the city instead was done by Urban Ore. City had been allocating fees and penalties without letting Urban Ore know. Fees total $14,000.
Kaplan (Economic Development): We found out about the status earlier this year as it was serviced by another department. There had been no monthly or annual reports to Urban Ore. An agreement has been made for a 2.5 year payback with penalties and interest. City needs servicing entity to service these loans.
Bates: Do we have any other issues with other loans.
Wozniak: The non-profits show audited financial statements and Urban Ore did not. There are other things I do not understand. Some expert needs to look at these financials. There were conditions on the original loans such as debt ratios. Don’t know if any of the conditions were met. I am concerned that Urban Ore is too casual about this.
Wengraf: I am concerned about all the outstanding loans, what are the interest rates on all the loans. I would like a report on all the loans. We need to be more rigorous about monitoring our loans.
Arreguin: I agree with the concerns but Urban Ore and the City have come to an agreement, this protects the city’s interest so I move the staff recommendation.
Worthington: Staff acted quickly when they found out about this. This organization saves the City thousands of dollars and saves the environment. I think this is quite favorable to the city in light of what we have learned. I support moving forward.
Moore: I am concerned that we do not get audited financial statements. I think we should have language that requires audited financial statements. I would like to see that language in our loan agreements. Is it too late to ask for an audited financial statement in this case? Substitute motion that we get an audited financial statement from Urban Ore.
Anderson: I think the point has been made about future processes. We have a situation and there have been mistakes on both sides. I don’t want to weigh all our deficiencies on Urban Ore as an example. It could harm the relationship with this organization that does so much for the city. An improved process is important.
Wengraf: I notice that in the information we received that the loan was for tenant improvements.
Capitelli: I am concerned about requiring an audit it costs much and a non-profit cannot always afford to do so. A tax return should be sufficient. If the loan is secured by the business, then what are we worried about?
Moore: No one has complained by the work done by Urban Ore. Urban Ore does an amazing job. It should be a policy of our city to be more cautious in making loans.
Bates: Let’s hold this over and refer to the city manager to see what options there are for insuring the loan.
Arreguin: Are there any personal guarantees that Urban Ore provided on the original or the new loan? Audited financials are added costs to any agency or business. We are punishing this business by waiting to figure out a city wide policy.
Bates: I think we should go ahead and approve this loan and refer to the city manager the issue of setting policies for any future loans.
Moore: I will withdraw the substitute motion.
MOTION AND VOTE:
Approve the loan
Yes: All others
Item # 32 ZAB APPEAL – 2727 MILVIA, ICELAND PROPERTY
This was a community asset that has been lost. Approving Berkeley’s first big-box retail store requires a public hearing.
EIR states altering the historic building is a faulty plan. No alternate was studied. There are no other places an ice rink could go. This would remove a recreational facility. Traffic gridlock would occur because there is not enough parking in the plan. It wWill impact bicycle boulevard and the cumulative impacts of Derby field and the Parker Street project were not studied.
This is an enormous opportunity for indoor sports activity. Once it is gone it is gone forever. It could have an indoor track. It could make Berkeley a destination for indoor recreation. This potential will be lost forever.
There must be a full public hearing.
Owner of Sports Authority. We want to preserve the building and have it be a functioning establishment for the community. It is an adaptive reuse. Affirm the decision of ZAB and move it forward. There was a 6-0 vote of approval. An ice rink is no longer financially feasible. Save Berkeley Iceland wanted to purchase but could not perform. We don’t want to be the group that will kill the dream but we are the next best thing. There is no legitimate issue with the EIR.
We will use a union contractor. Approve use permit.
This is an adaptive reuse of a city landmark. Construction would remove berms and add mezzanines. Appellants claim that it is the removal of a recreational facility. Final EIR addressed all EIR comments. ZAB was accused of not being impartial.
Support Sports Basement: Total 4
Save Iceland: Total 15
Moore: What are the community benefits this project will provide and the mitigations?
Staff: Benefits are to renovate, retrofit and occupy the building, employment and health benefits. Mitigations: green screen in place of berms, soft transition between sidewalk and building. Intersection improvements for traffic design features will mitigate greenhouse gas emissions.
Moore: I have heard about 70 jobs, which are great, but they are not required to be Berkeley residents. Traffic is an issue and there are too few parking spaces. They are not participating in a shuttle service.
Bates: This is not a green corridor issue or a MUP process. Perhaps we should hear from Sports Basement what they intend to do regarding hiring etc. I understand SB will be allowing visiting teams to use their facility to change etc. SB opposes a delay.
Moore: Are there any commitments to the high school football team etc.? How would a two month extension impact the process which would allow me to meet with you and that would allow a public hearing.
Wozniak: I also have nostalgia around Iceland. I have given time for Save Iceland to figure this out. I feel bad that there is not a solution and I don’t see anyone who will write a check to make an ice rink happen. There have been allegations as to why it was shut down it was because of the ammonia refrigeration. It was a toxic issue for the public. I think the council is favorable to recreational facilities. I cannot support keeping this building empty. I am impressed that the bike parking is greater than 2 to 1. I will support the staff recommendations.
Anderson: I see people my age who skated, and I am nostalgic of those years and they were valuable experiences. And it contributes to us coming together as a community. This has been a long process and it started with the potential ammonia emergency. We were lucky that no one was killed or injured by that release. In order to restore the facility the refrigeration must be replaced and that increased the cost considerably. This has been a long process. We have given time over and over again. We are at a stage now where the building has been sitting there for 5 years, it is infested with vermin it is blight on the neighborhood. We must protect the neighborhood from this blight and everything that goes with it. I am going to uphold the ZAB decision
Arreguin: I didn’t see that there is not an agreement regarding locally sourcing employees. The easiest was would be for the applicant commit to local hiring. Also I want to ensure that there will be community use but there needs to be a commitment.
Worthington: Both issues of community benefits and local housing are appropriate. I see this differently than anyone who has spoken this evening. The amazing amount of history that has happened in this facility has made this a landmark. The situation has changed substantially since then and we don’t know what will happen in the future. When the landlord was fighting against the landmark and let the property decline – that is reprehensible. What is before us is a temporary use that does not demolish the landmark structure. There seems to be an opinion that if a business goes in there then it will demolish the use. It could always come back and be an ice rink in the future. Based on that allowing this business to move forward is legally appropriate and respects the landmark. I support moving forward. I want to be assured that there will be a large percentage of local employment – it should be enforceable.
Moore: My understanding is that ice rinks are no longer allowed to use ammonia refrigeration so the risk to the community is disingenuous. None of this is binding unless we have a public hearing. I like process. We should have the ability to hear from the community in a public hearing – especially since they were told not to come here tonight. Substitute motion to hold over for a public hearing.
Capitelli: I have been involved in this from the beginning. I was involved in saving the Elmwood Theatre and we were able to raise $400K in two meetings. I asked Save Iceland early on and to develop a business plan. And I spoke with Pixar and they were willing to help finance yet they didn’t come forward. Also, I made several other suggestions for other uses but at that time Save Iceland didn’t want anything other than the ice rink. There was no point in the process where a significant amount of $$ was ever coming together. We don’t have the money. We aren’t maintaining our existing parks. If it makes us feel better that someday Sports Basement might leave and we get the building back, then great. And we had to say fix it or close it down when the ammonia gas leaked. I will support the main motion.
Arreguin: I hope the owner does keep his word that he will hire locally and keep the space open for community use. The interior improvements will be removable and these are not improvements that are irreversible. So I will approve the project. I think we must move forward. As tragic as it is at the current time we will not have an ice rink at this facility. Having this use now will help the neighborhood and remove a blighted facility.
Wengraf: I have very fond memories of our ice rink and it is unfortunate that we cannot keep it. I don’t think there are any other viable options out there, contrary to what has been alluded to. So I am going to support the main motion.
Bates: The owners of this property wanted desperately to save this building as an ice rink. They went overboard to try to make this happen. Save Iceland have a dream and they work every day to save it and I would be the first one to jump up and down if it was saved. I tried to help them save it. I am very sorry for them. It is a true landmark. And it is sad to see it decline. I was so happy that Sports Basement stepped up to buy it and I think if people look at their business model they will see that it is a good company and I will support the motion. This will be a new opportunity for our community. Times change and there is not a viable way to make it work.
MOTION AND VOTE
Uphold ZAB decision
Yes: All others
Item #35 – MEASURE GG FUND ALLOCATIONS – Disaster and Fire Safety
FY 2012 Actual
Expenditures: 5,618,688 Remaining Balance: 721,677
FY 2013 Projections
Expenditures 3,706,549 Projected Remaining Balance: 652,853 (Includes setting aside $220,000 for radio replacement)
Disaster and Fire Safety Commission recommendations will be discussed at October 2 Council meeting.
Additional staff is being trained to provide CERT training. There will be cache program enhancements.
Bates: Why is there such a great expense disparity?
Worthington: I thought we had already increased CERT and disaster preparedness. Is that already included? What percentage goes to CERT and cache in disaster preparedness? Is hourly employee use being discussed with the union?
Capitelli: When I meet with people they always ask about CERT training, where did the dumpsters go and what is the deal with gas shut off valve permit costs? People are putting gas shut off valves without permits because it costs too much to get a gas shut off valve permit. We need to take some money to incent gas shut off valve installation.
Bates: Can we find out how much money it costs to get a permit? Perhaps we can use the money to incentivize.
Anderson: We talked about using some of this money to distribute cache throughout the city. What is the present disbursement throughout the city? We need classes in the community.
Wengraf: Didn’t we already approve the money for radios? Why are we putting aside $200K/year for radios? If it is a fund then something smart should happen with that money. Is there a program that replaces cache contents throughout the city? We need to think about the new owners in the neighborhoods who have the cache but are not trained.
Wozniak: What kind of reserve fund balance is prudent? I think it is important that we have replacement funds.
Anderson: Turnover is an issue but looking at the stalwarts like churches are a better source and businesses too that will be the cache beneficiaries.
Bates: We are incredibly lucky to have these funds for our community. We cannot fail in our next exercise.
Dumpsters are no longer available but needed
We support the BFD and their pushing for grants for haz mat response equipment.