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The City of Oakland's Community and Economic Development Committee met on Sept. 27.

Oakland struggles to keep pace with growth

on September 30, 2016

A $100 million lab-grown meat startup needs demolition permits. Rival contractors are sparring over a $1 million job in East Oakland. The city’s few remaining single-room occupancy hotels, known as SROs and providers of increasingly scarce low-income housing, are falling like dominoes to developers.

The issues were all in a day’s work at a mid-day Tuesday meeting of the city’s Community and Economic Development Committee, where four of Oakland’s eight city council members confronted a backlog of business and complaints about unresponsiveness.

“Is our economic development director here?” asked Council member Rebecca Kaplan (At-Large), raising a point about an oft-repeated problem: a director who fails to return calls.

“No,” a few staffers muttered.

“I’ve heard this complaint about 500 times,” Kaplan said.

The crossfire-style exchange in a corner room of city hall, outfitted with the bright lights of a TV studio, was one of several tense moments during a meeting where few issues were settled. The purpose of the committee is to vet policies before sending them to the full city council, but multiple items on Tuesday were relegated instead to more study or other committees.

Looming over the procedure was evidence that Oakland’s dramatic economic and social change has strained a short-handed staff after the city shed more than 600 jobs round the recession.

“We are a mighty force of six now left,” Oakland Economic Development Manager Aliza Gallo said of her department’s reduced headcount.

At issue is no longer a lack of funding. Gallo cited a 63 percent jump in real estate transfer tax revenue so far this year, to $84.6 million, as the primary driver of an increase in funds flowing to city coffers.

Still, the committee was reminded that the city’s newfound prosperity means more work for them when Gallo presented a quarterly business report charting progress with new tenants like the faux meat company, Impossible Foods. The startup, which was granted pre-approval to renovate its new East Oakland research and development space, joined other businesses like the proposed Telegraph Brewing in seeking guidance on navigating red tape.

Perhaps the most pointed debate occurred over the issue of awarding a $1 million contract to administer public funding for a program to help small shops navigate construction on a large-scale transit expansion project. The project would compensate businesses “permanently and adversely impacted” by reduced parking, changes to turn lanes and sidewalks likely to impact both deliveries and foot traffic.

In play is a $108 million plan to turn East Oakland’s International Boulevard, long a stretch known for prostitution and high crime, into a model for transit-oriented development. The area is slated to serve as a guinea pig for Bus Rapid Transit models that would entail reducing the street to two lanes from four to allow buses their own traffic-free lanes from neighboring San Leandro to downtown Oakland.

Controversy on Tuesday centered on whether the bidder recommended by city staff for the job of steering businesses through construction, AnewAmerica Community Corporation, meets requirements for status as a local business. Two years ago, a similar issue disqualified the city’s first pick, Main Street Launch.

The president of opposing Mason Tillman Associates, Eleanor Mason Ramsey, said her Oakland consulting firm deserved the job. AnewAmerica, she argued, lists its primary mailing address in Berkeley, not Oakland.

City staff conceded that, despite a staff report saying AnewAmerica was qualified for the job, the company was not actually certified as a local Oakland business at the time staffers applied for the job. Though that certification was a requirement in the request for proposals, Vice Mayor Annie Campbell Washington (District 2) argued that the issue was sufficiently remedied after the fact.

“They did qualify,” she said. “It’s just that they weren’t qualified when they submitted their application.”

“Y’all are a bunch of crooks,” an observer in the front row commented.

A motion to move the award to AnewAmerica to a full city council vote despite the back and forth did not receive a second after members of the panel voiced their own displeasure.

“If we have a policy and we don’t adhere to that policy, why are we here?” Councilmember Larry Reid (District 7) said. “I’m not willing to vote for this.”

The promised small business funding remains an open question, as the contract recommendation was sent back to the city’s rules committee.

The question of how to proceed on SROs will also have to wait for its day in front of the full city council. Advocates on that issue spoke of a need for more proactive city measures to stem a tide of conversions of SROs into hotels or condos.

“Developers seeking profit should have to do it the old fashioned way — by building new housing,” said Brian Warwick, a UC Los Angeles graduate student who previously authored a report on SROs for the City of Oakland.

The committee agreed that the issue merited a closer look, and ordered a six-month study on how to most effectively preserve housing for some of the city’s poorest residents.

The panel did not go so far as to suggest a moratorium on conversions during the study period, which Warwick contended is necessary: “This six-month window would likely trigger a rush of hotel owners to sell their properties before new laws go into effect,” he said.

Warwick’s September, 2015, analysis documented 1,224 single-room occupancy units in downtown Oakland with an average monthly rate of $642—a fraction of the city’s current $2,000-plus median rent for a one-bedroom apartment.

Other business presented to the committee included a call from the West Oakland Commerce Association to reinstate city support for a “biz alert” program that business owners said is necessary to mitigate neighborhood issues like a rising number of homeless encampments. No action was taken, though the city administrator noted that the council can expect a forthcoming in-depth report on homelessness in late October.

After a three-hour meeting, City Council President Lynette Gibson McElhaney (District 3) announced that business for the day was done.

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Photo by Basil D Soufi
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