Blogging Bayport Alameda

June 6, 2019

A certain appeal

Filed under: Alameda — Lauren Do @ 6:06 am

I’ve been noticing that the whole Boatworks litigation has been on the closed session of the City Council for a while.  I typically ignore litigation because ever since Domain Web changed their website to start charging to view documents it’s been hard to figure out what’s going on with these lawsuit without a huge outlay of money.

But they do those half page things that you can sort of kind of figure out and since Boatworks has been laying dormant for so long, I thought, what the hey.  Turns out that there was an appellate court opinion recently filed in mid May which meant that I could see if the file was available on that website, which it was.

It’s a doozy.

But first this ruling is notable in light of the report out from Tuesday’s meeting after the City Council’s closed session meeting.  Apparently one of the “anticipated litigation” items was a settlement with Carmel Partners (they’re rehabilitating the North Housing units) and paid more than $2 million into the development impact fees for parks and recreation.  Because of the Boatworks ruling, the City settled with Carmel Partners and returned a large chunk of money in anticipation of a negative ruling in this case.

Just to back up, remember Boatworks is that huge fallow plot of land on Clement at Oak.  There has been lots of litigation around the project because of all kinds of issues.  I think that Boatworks has probably spent more money on litigation than it has on actually creating designs or going through the regulatory process.

Anyway, apparently the trial court had ruled in Boatworks favor in their litigation against the City in regards to development fees, specifically for open space and parks.  From the Court of Appeals background:

The City adopted Ordinance No. 3098, the Development Impact Fee Ordinance, on July 16, 2014 (the ordinance). The only component of the ordinance at issue here is parks and recreation. Citing the nexus study, the ordinance included a finding that there was a reasonable relationship between the need for new and improved park and recreation facilities and the type of development on which the fee would be imposed, since new residents would use parks and recreational facilities throughout the City, and that current service levels would fall if additional facilities were not provided. The ordinance set impact fees, of which $11,528 for single family homes or $9,149 for multi- family units was attributable to parks and recreation fees. The amount for single family homes is somewhat below the amount proposed in the nexus study, while the amount for multi-family units is exactly what the study proposed.

The trial court agreed with Boatworks that the amount of these impact fees were overinflated and had:

issued a writ of mandate directing the City to excise and vacate the portions of the ordinance that authorized development impact fees for parks and recreation.

The City of Alameda appealed and the Court of Appeals sort of split the baby.  One of the contentions of Boatworks was that the City had placed in its nexus study the cost to purchase future parkland which it had essentially gotten for free (Estuary Park and Jean Sweeney).  From the opinion:

The Development Fee Act allows the City to impose fees that have a reasonable relationship to the burden posed by the development. (Shapell, supra, 1 Cal.App.4th at p. 235.) But a fee based in significant part on costs the City will not incur, because it has already acquired ample land at no cost, does not have a “reasonable relationship to the cost of the public facility attributable to the development.” (City of Lemoore, supra, 185 Cal.App.4th at p. 562.) The trial court correctly so ruled.

The City also argued that they should and could include parks that had not yet been opened in its inventory for calculating development fees also Estuary Park and Jean Sweeney, the court’s opinion:

The problem is that neither of these parks was open to the public when the City adopted the ordinance. The City acknowledges that fact, but argues it was reasonable to include them in its inventory of existing assets because it anticipated using them as parks in the near future. However, the nexus study proposed using the development impact fees for construction of Jean Sweeney Open Space Park and of Estuary Park and its athletic fields. Nothing the City says persuades us it is proper to use a park as part of existing inventory for purposes of setting fees, then use those very fees to develop that park.

We need not, and do not, decide whether or to what extent it would be permissible for an inventory of existing parks to include planned parks whose improvement will not be funded by development impact fees. We merely hold that this record does not show it was reasonable to include Jean Sweeney Open Space Park and Estuary Park in the City’s inventory of existing parkland.

This is one argument that the City actually won and its around the classification of parks as open space and vice versa.  From the opinion:

[T]he purpose of this portion of the nexus study was different from that of the general plan—that is, its purpose was to determine the cost of developing park and recreation facilities. It would have been preferable for the City to explain why it treated certain “Community Open Space” areas as parkland in its cost analysis. But on this record, we cannot conclude its methodology on this point was “arbitrary, capricious or entirely lacking in evidentiary support.”

Some other notable opinions:

We have already concluded that, in two respects, the City failed to establish a reasonable relationship between the fee charged and the burden of new development. To the extent Boatworks’s argument is that fees must have such a relationship to the burdens of new development, we agree.

But they also wrote that:

We do not read the statute so broadly as to prohibit the city from imposing fees to maintain its current level of service. The new residents will use not only the new parks and fields, but all of the existing park facilities, which they did not pay to build. At the same time, they will increase the demand on the City’s parklands; to the extent the new athletic fields and other facilities are necessary to maintain the existing level of service, the cost of building them is attributable not “to existing deficiencies in public facilities” (§ 66001, subd. (g)), but rather to the increased demand from new residents.

But here’s the part that is going to hurt the City of Alameda:

On remand, the trial court shall issue a judgment declaring the parks and recreation fee as imposed invalid and unenforceable. The City, of course, retains discretion to impose fees that are consistent with the Mitigation Fee Act and the views expressed in this opinion.

Oh and Boatworks gets its attorney fees awarded in the trial court level but both parties have to bear their attorney’s fees for the appeal.

3 Comments »

  1. Trying to follow the bouncing ball as it relates to trying to protect the interests of the public reminds me of all of the closed sessions when we would get legal advice about the oncoming parcel tax litigation. As an elected official, you have a bias that wants to believe the legal advice you are receiving justifies fighting on since there is a lot of money at stake. On the other hand, the courts ultimately settle the matter. Sometimes you win, sometimes you lose.

    Comment by Mike McMahon — June 6, 2019 @ 7:50 am

  2. It’s hard to understand who is out of line without seeing a comparison of what other cities charge similar developments for parks fees. How is this situation different from what other developments in Alameda are being charged?

    Comment by michonnekatana — June 6, 2019 @ 12:52 pm

    • On the parks issue there is no difference, that’s why Carmel Partners was making noises about litigation and received a settlement. There appears to be a real problem in how the City has structured the nexus study for the parks impact fees, until it is resolved any developer who paid into that fund could pull a Carmel Partners.

      Comment by Lauren Do — June 17, 2019 @ 4:47 pm


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