Oakland released a tentative financial plan for development of a waterfront stadium at the Howard Terminal on Friday that clashed with the A’s vision for the property, showing how far apart the sides are and raising fresh doubts about the baseball team’s future in the city.
The city and the baseball team differ on two key points: the infrastructure tax financing districts to support the project and affordable housing on the property. Betsy Lake, assistant to the city administrator, wrote in a report that “staff has not reached agreement with the A’s on certain elements of the term sheet.” She noted that the city’s term sheet is a draft and could change as negotiations continue.
The A’s are seeking approval from City Council on Tuesday to indicate support for the team’s vision for the Howard Terminal site. A yes vote would allow the city and the team to continue negotiating. A “no” vote could kill the project.
Dave Kaval, the president of the A’s, criticized the proposal and said the city’s plan is a “step backwards.” He urged the council to instead vote on the term sheet that the A’s released in April.
“We remain far apart and what was released today does not work for the A’s, lacks specifics and a yes vote on that is a no vote on the project,” Kaval said. “We don’t agree with it. So it means we have no agreement at Howard Terminal. Howard Terminal is our last location to make Oakland work.”
Kaval said if the council votes on the proposal that the city put out, then they would be voting against the A’s plans to have a waterfront ballpark.
The city laid out a financial framework that requires 30% affordability for housing in the development, including a combination of on-site affordable units and offsite displacement measures.
The city made clear that the team and their staff would pursue one infrastructure financing district over the Howard Terminal site as opposed to the A’s proposed two tax districts, including one covering Jack London Square. The A’s have said the project is not financially workable without both proposed districts to bring in necessary revenue.
The city agreed to a 25-year non-relocation agreement in the new term sheet. Previously, officials had pushed for a 45-year non-relocation agreement, while the A’s had only agreed to 20 years.
City staff and the A’s have been in negotiations to develop a new term sheet that both sides agree on in preparation for the council vote on Tuesday.
The council vote is only a starting point to many more approvals the team has to get to move forward, including finalizing the environmental impact report, which is expected in the fall, and an approval on the community benefits package.
The team is expected to visit Las Vegas area July 21, a day after the council is expected to vote on the city’s development agreement.
If built, the project at Howard Terminal would dramatically change the city’s waterfront and generate jobs and tax revenue for Oakland.
The A’s first released a financial term sheet in April detailing their plans to build a $12 billion project that includes a $1 billion privately-financed 35,000-seat waterfront ballpark at Howard Terminal, 3,000 residential units, up to 1.5 million square feet of commercial uses, up to 270,000 square feet for retail, an indoor performance center for up to 3,500 people, 400 hotel rooms and up to 18 acres of publicly accessible open space.
At the time, Justin Berton, a spokesman for Mayor Libby Schaaf, said the proposal “appears to request public investment at the high end for projects of this type nationwide.”
And last month, Lake said at an Alameda County Board of Supervisors meeting that the city doesn’t believe using two infrastructure financing districts is “fiscally responsible.”
Since then, the city and the team have struggled to reach agreement.
The A’s proposed creating two infrastructure financing districts — one over the Howard Terminal site and another over a larger swatch of Jack London Square.
The team proposed using the tax revenue from those districts to fund infrastructure upgrades and community benefits.
The A’s estimated that the Howard Terminal district would generate $860 million in tax revenue and that $1.4 billion would be generated from the second tax district over Jack London Square.
The city argued that tax revenue generated from the second tax district, over a part of Jack London Square, would exist without the ballpark project. The city has so far rejected the proposal to create that district.
On Friday, the city detailed plans to create a single tax district over the Howard Terminal site that would capture the city and the county’s shares of property taxes for 45 years.
The city’s financial plan states that the developer, in this case the A’s, will fund all onsite infrastructure, and the creation of parks and open space. The A’s can be reimbursed by up to 80% of all tax revenue from the tax district of the project site.
In April, the A’s estimated that the Howard Terminal Financing District will generate $860 million — with $495 million of that used to fund all on-site infrastructure costs, including environmental remediation, seismic improvements and sea level-rise improvements.
The projected cost of offsite transportation infrastructure improvements, grade separation and parking management could cost a total of $351.9 million, according to A’s projections. The city and the A’s are still negotiating how that will be paid for.
City staff said they will work with the A’s to apply for local, state, federal and other regional funds to help pay for the cost of offsite infrastructure upgrades.
Another sticking point between the A’s and city is the number of affordable housing units that will be built as part of the overall development.
The A’s proposed using the two infrastructure tax financing districts to raise $450 million in taxes for a community benefits package. That money would be raised over the next 45 years. The A’s said the city can decide what to do with those funds, including building affordable housing.
But council members sharply rebuked their proposal and said any development must include a certain number of affordable housing units as mandated by city law.
The city’s financial plan states that the A’s will be required to build onsite affordable housing — as required by city and state law that “cannot by waived by the City.” The project must include 15% of all new onsite units to be affordable resulting in about 450 affordable units.
The city plans to set aside funds from the community benefits package to fund anti-displacement strategies aimed at an additional 450 affordable units. This could include new construction, preservation of existing units, renovation and other assistance.
Sarah Ravani is a San Francisco Chronicle staff writer. Email: [email protected] Twitter: @SarRavani
