OAKLAND — In a report issued Friday, Oakland administrators laid out sticking points in the term sheet being negotiated by the A’s and city, namely over proposed tax districts to fund infrastructure costs, arguing that without financial help from Alameda County the $12 billion development could be in jeopardy.
The city is also asking the A’s to sign a non-relocation agreement lasting at least 45 years.
A committee of the Oakland City Council on Tuesday plans to review the report at a study session meeting, the first in-depth exploration of the project terms before council members. It comes ahead of a critical July 20 meeting of the full City Council, which is expected to vote on a non-binding term sheet with the A’s, who are threatening to leave if there are any delays.
The report released Friday is in response to a term sheet the A’s put out in April outlining their vision to reach a development agreement for the proposed $12 billion project, which includes a privately-financed $1 billion, 35,000-seat ballpark, 3,000 housing units, hundreds of hotel rooms, commercial and retail space and open space and a performing arts center.
According to the report by project manager Molly Maybrun, most of the terms contained in the A’s term sheet were negotiated and mutually agreed upon in private meetings over the past year, but there is not consensus on the team’s proposed financial plan.
The A’s want Oakland to create two tax districts, one specific to the Howard Terminal site and the other spanning a mile-and-a-half section of Jack London Square, mostly between the Nimitz Freeway and the waterfront between Oak Street and Mandela Parkway.
If formed, properties within the so-called “enhanced infrastructure financing districts” are assessed, and the tax money from annual increases in their value is funneled directly into project-related uses and affordable housing instead of being distributed entirely to local governments and special districts. The revenue generated from the two districts would be used to repay the A’s for infrastructure costs.
At a meeting before the Alameda County Board of Supervisors last month, Assistant City Administrator Betsy Lake said it would not be “fiscally responsible” for the city to create a tax district outside the project site, in adjacent Jack London Square.
Currently, the city receives about $73,000 a year in its share of property taxes from the Howard Terminal site. Oakland officials project that over 16 years the city’s annual property tax revenue would jump to $11.5 million. But it’s “unknowable” whether any increase in property value in Jack London Square could be attributed directly to the waterfront ballpark development, officials said last month.
The city has asked Alameda County to opt in to the tax district to contribute its share of property tax revenue to fund infrastructure. In documents included in the Tuesday meeting packet, Oakland city administrators say without help financial from the county, the proposed development is “most likely” a “dead deal.”
Alameda County can opt in to the proposed tax district at any time. The Board of Supervisors last month would not commit to join the development’s funding plan and are not scheduling a vote until September at the earliest, to allow county staff to review the matter.
A’s President Dave Kaval, in an interview Friday, said the team “feels strongly that both (tax districts) are necessary for the project to work,” including to fund off-site affordable housing.
“It remains concerning to us that their counter proposal relies completely on the county,” Kaval said.
Mayor Libby Schaaf, in a prepared statement, said the “report shows how we can structure a development deal that protects our taxpayers” while keeping the A’s in Oakland and transforming the city’s waterfront.
“We believe that only the tax revenues generated by the ballpark development itself should be used to invest in the project’s much-needed public infrastructure and community benefits, in a way that never puts the City or County’s general funds at risk,” Schaaf said.
City staff is also recommending the A’s enter into a binding non-relocation agreement for the life of the infrastructure tax districts expected to last 45 years. So far, the A’s have agreed to only a 20-year term, contingent on no increase in city taxes, the report released Friday said. Under the city’s proposal, any new owner would be subject to the non-relocation agreement. The A’s have agreed to that provision.
Kaval said Friday the A’s are open to a non-relocation agreement but it would need MLB authorization. “I am solely not authorized to agree to something like that,” he said. “We have been very clear we think a non-relocation agreement makes sense and we are willing to have one.”
The study session begins at 10 a.m. Tuesday and members of the public can access the meeting virtually on Zoom. Council members Carroll Fife, Noel Gallo, Loren Taylor and chair Dan Kalb sit on the committee.
The A’s and city officials will continue to negotiate the term sheet before presenting recommendations before Oakland City Council on July 20.
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Author: David DeBolt