Reed’s Halo Effect

I had hoped it would happen and it did last night. After a dark decade of flawed land-use decisions and “pay to play” mentality at City Hall, Mayor Chuck Reed, aided by two or three thinking council members, got the San Jose City Council to finally jettison the shortsighted and ruinous policy of converting our job-rich tax base lands to housing. Perhaps, just perhaps, the rump members of the “old” discredited group of Gonzales holdovers will get the “halo” effect of sound planning and begin to live up to their fiduciary responsibilities to the people of San Jose. But, as was once said of second marriages, I am, perhaps, letting hope triumph over experience. There is much left to do.

There is a strong, persistent group of lobbyists and developers who are using every reason and excuse to keep the flawed decision making in place. And why not?  Many of the cadre of former mayoral staffers and flimflam men would be working at minimum wage if not for the golden road of preference and privileges that was opened to them in recent times. More money was extorted from applicants and city coffers than we will ever know. Along with the Coyote cartel of developers, they are a constant reminder of the dark hole that the city emerged from with the election of Reed and the other reform-minded members of the city council. Many hold feelings that Kansen Chu will also join the march to restore the city’s financial and planning common sense, but that remains to be seen.

In the effort to restore our tax base there is a simple fact: the cities of Palo Alto, Mountain View, Sunnyvale, and Santa Clara have built their per-capita tax base and total revenues by nurturing their tax base and encouraging companies and commercial ventures to locate there. They only modestly added to their housing component. They didn’t have to. In the metropolis to the south, San Jose, we had a city—politicians, developers and the labor bosses in an unholy alliance of convenience and greed—willing for selfish, mercenary reasons to do that for them. The nearby cities had their jobs, parks, and fine services, and our housing and deficits to support them. Into the alliance, they added the honest voices of low- and moderate-income housing advocates, including PACT, the prestigious and laudable church group. What is lost in all this is the simple truth that we are unable to give our citizens, primarily the low- and moderate-income residents who need them most, the type of services—police, parks, libraries—that they have every right to expect. At long last, it is time for council members, advocates for the poor and minority neighborhoods of our city, and others of good will and judgment to restore San Jose’s tradition of sound planning and budgeting.

The hour is late. There are many details in the unanimous vote to restrict conversions. The forces of darkness and confusion are ever present and ever ready to stretch a point, tell a lie, or buy a vote in the search for more and greater profit. Only the people of San Jose are hurt. Ultimately, only they can set this situation right. 

Halos are in short supply (we saw one such instance last night), but their effect can be pervasive. 

42 Comments

  1. Maybe we’d have more space for industry (that doesn’t want to be here) if we didn’t build parking lots everywhere. North First is such a waste of space, but it’s still infinitely better than the billion sprawling campuses across the valley. The leaders of technology should be embarrassed that their places of business are so geared toward the automobile. We should focus on a campaign of calling out and shaming the anti-green Silicon Valley. “Green” is the new”carbs” these days. Give them bad publicity and make them seek the good stuff. Perhaps that will herd these big companies to a real CBD with space-saving streetfront entrances and near light rail, Caltrain and the upcoming BART money train.

    It makes more sense than Barry Witt’s fun-killing, anti-Earthquakes march.

  2. I will take heed
    Yes, agreed
    I will concede
    Indeed,
    With Mayor Reed
    We don’t have to cede
    To the lobbyist greed
    Mayor Reed is a different breed
    He will plant the seed
    So jobs won’t bleed
    He will take the lead
    No lying or stealing, his creed
    He will mount the steed
    And with light speed
    Far and above exceed
    To do a good deed
    To meet the need
    The hungry he’ll feed
    He won’t mislead
    We must proceed
    So we all can succeed

  3. Yo I just wrote this yesterday! The easy solution to Jobs/Housing balance is to “annex” the west valley cities.

    “San Jose’s tradition of sound planning and budgeting.”

    What’s in this tradition? San Jose’s growth happened under Dutch Hammond’s wild west, anything goes, lasseiz faire, easy money, pave the orchards tenure in the City Manager’s office. No planning was involved.

    Basically, I really liked the piece, but why rewrite history? Planning in San Jose only really started after the city was mostly built out.

  4. Greg – Actually, the vote was unanimous, but the devil will be in the details and the excuses to vote for “changes” for donators, union buddies, etc. very strong.  The lobbyists are now seldom seen around City Hall but don’t be fooled.  Getting jobs at McDonald’s is not what they want to be reduced to – they will mount challenges. Also, the Soccer Stadium proposal of Lew Wolff ( which the Sharks and I have an interest in ) must be judged on its merits. It is a conversion and must be properly and openly reveiwed. Wolff is an honest, open and transparent person who will be clear
    on his proposal.  TMcE

  5. Dear San Jose:

    I agree with much of what the former mayor said in today’s blog.  I think that yesterday’s vote was an important one for our city.  I also think that the vote demonstrates Reed’s expanding political power.  I predict, that within two years, San Jose’s mayor will be viewed as the most influencial leader in the Bay Area…and that’s a good thing for San Jose!
    ————
    I’m so glad Tom McE mentioned the soccer stadium issue.  Let me just remind everyone, that if $100 million can be generated by “flipping” city entitlements, those rights should go to the project or developer that produces the highest benefit/return to the city.  IF, someone steps in and offers to kick back $90 million to the city to repair parks, streets etc, the people should get to decide which course of action to pursue.
    AND, how is it environementally sound to build a new soccer stadium if a new football stadium is going to be built in Santa Clara?  Give me a break.

    Pete Campbell

  6. Tom- “Actually, the vote was unanimous, but the devil will be in the details and the excuses to vote for “changes” for donators, union buddies, etc. very strong.  The lobbyists are now seldom seen around City Hall but don’t be fooled.”

    No kidding. When most of these Council members run for higher office, they need the money, connections, and man power these lobbiest will provide them with. That’s where we voters come in. Keep an eye on who flip flops in the next year, and use your one vote wisely.

  7. #7 : Right, the “right” should go to the project or developer that produces the highest benefit/return to the city. And in this case such project or developer has been found. They are called the Earthquakes stadium and Lew Wolff respectively.

  8. Tom,

    That is good news indeed!  For far too long, San Jose has been cajoled by developers, politicians and unions into converting our limited space from industrial, retail and office to residential zoning.  I can only imagine who the Council members were that dissented… do you care to publish the names and votes?

  9. #3 Hey George that was cute the first 100 times you did that. Now it’s just STUPID! enough already OK.
    Leave the cute / dumb writing for Tiny Tim!
    start your own blog some where were the will enjoy your crappy rymes…

  10. Cute, taxpayer in DT doesn’t like my poetry.  Then how come last year my fourth grade teacher, Ms. Lopez gave me an “A” in my creative writing class at Willow Glen Elementary School?

  11. #7 Pete Campbell writes, “AND, how is it environementally sound to build a new soccer stadium if a new football stadium is going to be built in Santa Clara?  Give me a break.”

    What the hell does this mean Pete? So, we shouldn’t build something because a similiar type structure might be built outside of San Jose? So, using your logic, if a Marriott is planned for Sunnyvale we should not build a Hilton in San Jose? Or, if Microsoft wanted to build a facility in San Jose we shouldn’t allow it if Oracle has plans for one in Mountain View? Hey, let’s just not build anything.
      And Pete did you know that the planned soccer stadium is just part of a greater development plan for the blighted FMC land that is costing the city $7 million a year? The entire project would bring hundreds of millions of dollars in construction to San Jose. That’s a lot of jobs Pete. Not to mention the tax revenue that the city will be taking in from the businesses that will be there.

      San Jose will likely never again have the opportunity to realize a modern outdoor sports venue at such little cost.

  12. I never thought I’d be saying this, but I think the Reed administration’s penchant for putting the brakes on everything in the City of San Jose may just be a good thing.

    Let’s call a halt to all disjointed, corruption-driven, scattershot development.  Let’s create “a new way of doing business”.  This new way of doing business is called “consensus”.  We need to find out what the entire city wants, and what’s good for the entire city…not just a neighborhood, not just a developer, not just the Labor Council.  If it doesn’t pass the “city consensus” litmus test, it doesn’t gain inclusion into the general plan.

    Here’s hoping that Mayor Reed uses the remainder of this term to bring a halt to all self-centered developement that doesn’t benefit the city as a whole.  If that means we need to take a pass on certain developments that are on the table now, then so be it (sorry, soccer fans, your stadium just doesn’t happen now).  Stop, step back, re-assess, make a whole city plan and, most importantly, STICK TO IT.

  13. RIPavilion says, “If that means we need to take a pass on certain developments that are on the table now, then so be it (sorry, soccer fans, your stadium just doesn’t happen now).”

    Remember that Lew Wolff is committing to donate 100 percent of the rezoning proceeds to the city of San Jose. It doesn’t get any better than that. If that deal’s off the table, I think all developments are off the table.

    But perhaps that’s what you want—no new projects in San Jose? I happen to think that’s throwing the baby out with the bath water.

  14. #15 : City council to RIPavillion, city council to RIPavillion :

    We have taken a note of your latest blabbering and will get back to you.

    In the meantime, it will help if you ease up on your Prozac dosage. Talk to your psychoanalyst. Help is out there, if only thou shalt attempt to seek it.

  15. Quaker-all I’m saying is the time is now perfect to change the way of doing business, from a piecemeal development plan to a plan in concert with the needs and desires of the entire city.  The only way to do this is to stop, step back, devise the plan, execute the plan, and stick to the plan.  If that means that the time is not right for what you want (a soccer stadium for the benefit of a precious few), then it’s unfortunate for you, but necessary to pass on the deal.

  16. RIPavilion says, “…a soccer stadium for the benefit of a precious few…”

    I’m not saying the city should abandon a general plan, but it seems defeatist to stipulate that any new development should satisfy “the entire city” in the way you apply that stipulation. What project has ever achieved that?

    All projects disproportionately benefit a subset of the population. A new library or park in another part of town doesn’t benefit me, nor does a senior center (at least not commensurate with the cost). Likewise, you can dismiss a new stadium because it only benefits “a precious few.” You can see how the “needs and desires of the entire city” stipulation applied in this manner can eliminate virtually everything.

    I think the Airport West stadium, hotel, and business development has a lot of benefit. The city turns a blighted piece of land that’s costing it millions of dollars a year into a very attractive tax-generating property. Furthermore, the city becomes owner of a state-of-the-art stadium without using any of its funds. Unlike some other “local” projects, that stadium will draw people from all over San Jose and the surrounding areas, and it will host events beyond soccer. And our new professional teams will help put San Jose on the map. So I think even those who aren’t soccer fans will benefit nicely from the Airport West development.

  17. I love this talk of the city getting a “free” stadium.  Let’s first see the 50+ year contract between Mr. Wolff and the city to determine how “free” this stadium will be.  The Mercury New reported that Mr. Wolff and Mr. Krutko have crafted a convoluted ownership agreement so Mr. Wolff can avoid paying taxes on his windfall from the zoning conversion.

  18. Who will pay for the infrastructure needs that come with ANY development? Stop scrutinizing a stadium just because it’s a stadium. Take a look at all of the happenings in a city.

  19. It’s really not that difficult to get some idea of the future costs associated with a sports facility.  The city has a history with the downtown arena.  There was considerable opposition to it’s construction, mostly for the same reasons that some are objecting to Lew Wolff’s proposal.  It is really hard to argue that the arena has not been a good addition to San Jose.

    The soccer stadium is but a small part of the overall proposal, although Wolff clearly has no interest in the project if it does not include the stadium.  It is inevitable that there will be opposition, as it is the nature of some people to always be suspicious.  This proposal needs to be considered on it’s own merits and not in the context of previous cynical city officials.

  20. O.Yeah #21 writes, “But it is not free. Who will pay for the infrastructure, the operations and maintenance after it is built, and the numerous unknown costs? And who pays for the loss of industrial land so more housing can be built that will further drain the city coffers to pay for increased city services? “

    Part of the proposed deal (it can be accessed on the city website) is that the Earthquakes will be responsible for infrastructure, operational, and maintenance costs on the new stadium. As I mentioned earlier, the FMC site is costing the city $7 million a year to pay off. Not only will the stadium project erase that debt, but, it will create additional tax generating businesses on a blighted property that has had no real interest from other developers.
      Regarding the rezoning/housing component of the deal. Yes, residential does *tend* to cost a city more in services. However, not all areas have the same cost. Older, spread out neighboorhoods with a more antiquated infrastructure would be more costly to support than a denser, modern development. Each has to be judged on its own. You can’t make the blanket statement that the proposed new housing would be a negative cost to the city.
      Regarding the loss of industrial land. The city has already determined that they can transfer the loss of industrial land from the i-Star site by increasing the “density” of existing industrial land in the same area, resulting in no net loss of industrial capacity.

  21. We will clearly see if Mayor and Council are just talking about openness or really means it when the soccer “economic impact ”  stadium discussion comes before Council  

    O Yeah explained cost issues well –

    –  ” it is not free. Who will pay for the infrastructure, the operations and maintenance after it is built, and the numerous unknown costs? And who pays for the loss of industrial land so more housing can be built that will further drain the city coffers to pay for increased city services? “

    Let the ” economic benefit ” games begin

  22. #18 RIPavillion writes, “all I’m saying is the time is now perfect to change the way of doing business, from a piecemeal development plan to a plan in concert with the needs and desires of the entire city.  The only way to do this is to stop, step back, devise the plan, execute the plan, and stick to the plan.”

    RIP, the Wolff proposal is a change in the way business has been done. The profits from the rezone are not going into his pocket, it will go into a modern outdoor venue that will be owned by the city. You may not be a soccer fan, but there are many in the city who are. Not only will the stadium be a home for the Earthquakes, but, it will certainly host many international games, including teams from south of the border, which are very popular with San Jose’s large hispanic community.
      Additionally, the stadium will likely host events other than soccer, such as concerts. Certainly our government has a responsibility to provide certain services to its citizens, but, as one council member told me, the city also has the responsibility to help provide entertainment and recreational opportunities. Here is a chance for the citizens of San Jose to realize a state of the art outdoor sports venue at no cost to the taxpayer. How many cities can boast that?

  23. O. Yeah writes, “Who will pay for the infrastructure, the operations and maintenance after it is built, and the numerous unknown costs?”

    Lew Wolff’s proposal to the city says he’ll cover any cost overrun for building the stadium and then lease it from the city for 55 years. As the city’s development manager reported, “Under the proposal, the City will incur no costs for stadium operations over the 55 year period. The Developers will commit to pay for all associated maintenance costs as well as the capital costs required to maintain the stadium at a first level professional and international
    soccer facility.”

    O. Yeah writes, “And who pays for the loss of industrial land so more housing can be built that will further drain the city coffers to pay for increased city services?”

    This is a legitimate question. The city will have to pay for more services with utilized residential land than with utilized industrial land. But keep in mind that the additional people living in San Jose will spend their money here (more sales taxes) and own residences here (more property taxes). And because of them, more businesses will spring up in the surrounding areas. Plus, consider all the benefits of the Airport West development spelled out in my earlier post (at little or no cost).

    So it’s really a complex cost-benefit analysis that needs to be weighed against the current use of the properties (virtually nothing).

  24. Of course, this all sounds great. Basically a free stadium—who could be against that? But it is not free. Who will pay for the infrastructure, the operations and maintenance after it is built, and the numerous unknown costs? And who pays for the loss of industrial land so more housing can be built that will further drain the city coffers to pay for increased city services?  We need to be realistic about this—most of us have learned if something is too good to be true it probably isn’t true.
    I have nothing against soccer, but I do believe we need to know the real and true costs of this proposal before we find out we are stuck with mounting bills that can’t be paid.

  25. Steve (#22) writes, “The Mercury New reported that Mr. Wolff and Mr. Krutko have crafted a convoluted ownership agreement so Mr. Wolff can avoid paying taxes on his windfall from the zoning conversion.”

    Yeah, pretty sneaky of Lew Wolff. Instead of giving up some smaller percentage of the rezoning profits in taxes, he’s giving up all of the rezoning profits!

    The reasons for avoiding taxes aren’t as sinister as you’re implying. He’s passing along the benefits to the city, so it would make sense to try to avoid taxes. More money that can go into the stadium and thus more benefit to the city.

    I’ve noticed that some posters can’t imagine a business deal being beneficial for both parties. But good deals create economic value that can be split. I think that’s the case here.

  26. Steve #22 writes, “The Mercury New reported that Mr. Wolff and Mr. Krutko have crafted a convoluted ownership agreement so Mr. Wolff can avoid paying taxes on his windfall from the zoning conversion.”

    That’s great thinking. I would rather have that money spent on a construction project that will benefit the city of San Jose, rather than having it sent off to Washington DC where it would be wasted on who knows what by the federal government.

  27. Quaker #19 / #28 makes very weak public policy economic argument about ONLY comparing

    1)  Current use of 2 vacant properties to
    2)  Wollf’s proposed use ( iStar as sale to residential developer and FMC as Wollf’s stadium, retail, hotel and offices )

    San Jose is ONLY considering ONE bidder (Wollf) not many bidders needed to get greatest public benefit from city and other properties What about

    3)  Other possible developers for same city owned property ( retail shopping center, high density office building near Light Rail line, mixed use etc ) plus
    4)  Inviting other developers to propose land conversions on other properties

    San Jose has many times practiced poor policy of considering ONLY One INSIDER and political contributor group proposal bid with NO comparison to other proposal alternatives which is why San Jose has current budget mess

  28. Steve (#32) wrote, “I could then claim I gave the city a “free” house and everybody would praise me.”

    And you’d deserve some praise if your agreement with the city stipulated that you pay for all the upkeep and improvements as well as rent over those 99 years.

    Where are Alternative Use Proposals? (#31) wrote, “ONLY comparing

    1) Current use of 2 vacant properties to
    2) Wollf’s proposed use”

    Well, the city’s been paying for the debt on the Airport West property for three years now, and there haven’t been any serious bites from developers. But certainly, letting the property continue to sit idle at taxpayer cost is another option that should and will be considered.

    Where are Alternative Use Proposals? (#31) wrote, “What about

    3) Other possible developers for same city owned property ( retail shopping center, high density office building near Light Rail line, mixed use etc ) plus
    4) Inviting other developers to propose land conversions on other properties”

    Of course, IF another developer comes forward with a plan that gives 100 percent of the “land conversions on other properties” to the city, proceeds to turn the blighted Airport West land into a major tax-generating business development, and helps put San Jose on the national and international map, he or she should receive equal consideration. I’m not holding my breath for that hypothetical developer, though.

  29. #7, Pete, Soccer will do just fine in San Jose even if the 49ers go to Santa Clara. They are two different sports, two different fans.
        Soccer is the “future”. Some saturday morning take a ride out to Almaden Valley and tell me how many football teams you find, “zero” today, but soccer is everywhere.(boys and girls teams of all ages) When these kids grow up they will continue to be soccer fans.

      San Jose could use the revenue from soccer. The Eartquakes games have been sold out, the city has supported soccer.

  30. Earthshaker/Quaker/Reality Check,

    Sure, we could all claim our taxes could be better spent locally but we pay our taxes anyways.

    On second thought, I should call Mr. Krutko, set up a non-profit, and donate some appreciated assets.  The non-profit would sell the assets and build me a nice new house.  I would then donate the house to Mr. Krutko and the city with an agreement I could live in the house for the next 99 years.

    I could then claim I gave the city a “free” house and everybody would praise me.

  31. Why would anybody in their right mind believe that Mayor Reed meant anything he said to get elected?

    He has demonstrated (once he was in office) that all of the virtues he claimed were simply “campaign slogans”, very effective ones too!

    When the unions stop controlling San Jose and this city stops with the socialist policies I will then believe that maybe Mayor Reed actually has the interests of San Jose Residents at heart.

  32. Tom,
    I just read the article in the Merc about SJI, and San Jose Revealed. I thought that San Jose Revealed disappeared when it was linked to Cindy Chavez, and she denied knowledge of who was running this blog. Secondly, San Jose Revealed looks exactly like Mayor Watch, and seems to be written by the same person. I didn’t see very many comments on that blog, when I viewed it today, but I sure did see a lot of Reed, Dando, Vic, and bashing of you!
    I find it curious that San Jose Revealed has reared its head again, right before elections next year. I feel sure some Labor folks are involved. Any thoughts on this Tom?

  33. Steve #32 writes:

    “On second thought, I should call Mr. Krutko, set up a non-profit, and donate some appreciated assets.  The non-profit would sell the assets and build me a nice new house.  I would then donate the house to Mr. Krutko and the city with an agreement I could live in the house for the next 99 years.
    I could then claim I gave the city a “free” house and everybody would praise me. “

    Poor analogy Steve.
    You see, when the free stadium is built, prior to a game I may take the wife to a downtown restraunt and have a nice meal, then I may stop and fill the gas tank, I’ll then fork over more money to park, and then have a beer or two at the stadium. All through my little journey to watch a game of soccer at the free stadium I was dropping tax dollars in my wake. And I am just one of thousands doing this.

    On the other no one is going to drive over to Steve’s free house and watch him sit in his basement in his underwear, wearing his little engineer cap, playing with his HO train set.

  34. OK,

    Here goes. New to this blog but not to SJ. 

    Mask is for a reason. Not happy about that, but so be it.

    First. I like Tom and even Chuck.  I also like Cindy.  They are not bad people, actually very good folks.

    The problem with this blog is that you really have now glue on how city government really works.

    There is no such thing as transparent government operations.  It doesn’t exists.  Never has, never will.

    Its incompatible with our power actually works.  Brown Act tried to do it, and what it did was provide really good cover for the players.  Decisions are still made out of public view, put there is this nice appearance now that it is done in public.

    All the ordinances in the world will not prevent the real players from deciding the real decisions.  Lips service of course will be given and the dots and dashes will be noted.  The players have learned that the more rules, the better.  This prevents the normal people or the less skilled from playing.  Best leave this to the professionals!

    Most pols are either lawyers are learn guicly to think like lawyers.  They don’t vote in city council meetings without already knowing how they will be voting.  Most of the time they already know how the others will vote.  No, its not a perfect science, mistakes happen, but on the whole all the players know what is on the up.

    A quick look at the Chambers recent ‘sponsored’ trip to Texas with almost a quorum of the city council and many lobbyist will give you the idea how this is played.  In that plane ride, those tours, dinner and after dinner parties, do you think public policy wasn’t discussed? 

    Really?.. never?.  Shame on you.  Not even a small bit?

    Of course.  And where was the open transparency?

    Who discussed what, when and where?

    Well, that trip was just only an illustration of what really goes on every day behind curtains. 

    How many dinners, parties, events do you think these people attended jointly together?  Lots!..  Do you think anyone is taking minutes?  Not!

    Go ahead and make your sunshine rules.  Only people you are hurting are probably the least able to voice an opinion..  Namely, normal folks.  The pros will do just fine.

    Real solutions – yes, there are some, but probably best for another note.

    darkone

  35. #39- Welcome to SJI. You are mistaken if you think many of us don’t agree with much of what you’ve said. I know from personal experience that things are decided long before the Council sits in a Council Meeting and asks staff endless questions, and give long speeches about issues they’ve already decided on. None of us is ignorant enough to believe that we common folks hold a lot of power, outside the voting booth.
    It’s rather sad when you think about it. If you don’t have a fancy job title, lots of money, or a pedigree, your opinion matters about as much a sunshiny day in August. It is no wonder people have stopped voting, hate politicians, and don’t trust a politician as far as they can throw one.
    I personally have chosen to keep voting, keep voicing my opinion regardless, because when things go to hell, and they do and will, at least I know I’ve tried to participate in the process, and have taken some responsibility in my community.
    Glad to have you aboard! Keep posting!

  36. Darkone # 39 opined:“The problem with this blog is that you really have now glue on how city government really works.”

    Freudian misspelling—the SJ building dept. really is “now glue” on projects; and the city govt. in general is “now glue” on business.

  37. John,

    Just reminds me never to send email or a blog message after 9PM!

    However, your corrections are not only well noted, but well received!  I enjoyed that.

    Perhaps not as dark as I thought.

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