Saturday, March 17, 2018
|Pointless Picture designed to get your attention.|
Please see the official press release from the Department of Industrial Relations HERE
*I am not certain that any appliances will count towards the remodeling project $25,000 maximum value since I believe they will be considered separately.
Friday, March 16, 2018
Marinwood Fire Department still doesn't have a kitchen. Chief Roach cites that John Pope has not submitted bid and "he had no other bids" ignoring the written bid from The Granite Expo that will save Marinwood CSD at least $50k. Former CSD Director Bill Hansell has been hired as the architect to design plans for a maintenance shed which is situated in the stream conservation setback of 100 feet. Neighbors stood loudly in protest of the project in 2017 when the CSD presented "ideas for feedback". The CSD directors have chosen to ignore the feedback and bulldoze ahead despite legal, environmental and citizen opposition. And then there is the ridiculous expenditure for a custom design vs.low cost architect designed prefab structures used by government agencies worldwide.. Tax Revenues are up significantly due to the recovering real estate market yet the pace of expeditures by the CSD is even faster. Serious overhaul of financial management is necessary to tame the out of control beast.
Thursday, March 15, 2018
Posted by: Jim Phelps - March 10, 2018 - 10:14am
The history of MCE is marked by consumer deception and false advertising about the true cleanliness of the energy it delivers in the fight against global warming. In 2015, in response to public criticism, MCE claimed it would sever ties with Shell Oil: that by 2017 it would be free of Royal Dutch Shell’s subsidiary Shell Energy North America.
Following mounting public criticism, MCE also promised to cease its use of renewable energy certificates, known as RECs. This latter commitment garnered the support of the Sierra Club, whose attorney’s referred to the use of RECs as "deceptive marketing" when PG&E proposed using these instruments in its now-abandoned “Green Option” that was proposed to compete with MCE.
Out with Shell...
In 2017, without fanfare, MCE’s full services contract with Shell expired. Long-time critics and environmentalists watched in anticipation for this new day to arrive, when the misdeeds and misdirections of MCE and its CEO, Dawn Weisz, might cease along with MCE’s exports of cash to Royal Dutch Shell in the Netherlands -- which, to date, top one-half billion dollars.
However, with MCE there is frequently a caveat.
Even though MCE announced it would no longer engage Shell with a “full-services” contract, a pipeline of energy purchases continued to flow to the oil giant. Those contracts ranged from $10,000 to a $27.3 million contract that Weisz executed last month.
In a curious twist, MCE Chair Kate Sears was embroiled in a conflict of interest charge in late 2017, because she held Royal Dutch Shell stock while voting on MCE contracts with Shell. According to Supervisor Sears’ Form 700 filings with the County of Marin, she also holds stock in Exxon-Mobil, Phillips 66, Occidental Petroleum, BP, Total (French oil company), Conoco Phillips, Chevron, and oilfield services company Schlumberger.
Nevertheless, with Shell’s departure as manager of MCE’s energy portfolio and energy scheduling, MCE was in immediate need of expertise to fill that void.
… in with conflicts of interest and investigations
MCE received six bids from firms that proposed managing MCE’s energy portfolio and scheduling energy deliveries. MCE awarded a contract to ZGlobalby unanimous vote of the board, in June 2016. Part of the justification for selecting ZGlobal was that it offered what’s known as “shadow settlement” services, which is a parallel reconciliation of the myriad of charges accrued during the delivery of electric power.
Ironically, Weisz ducked a public question about shadow settlements in 2009, when she brought her MCE entourage to Novato, seeking support for the pending launch of her fledgling enterprise.
MCE presumably conducted due diligence on ZGlobal, but it failed to identify that the company had caught the eye of investigators who were zeroing in on its conflicts of interest and double-dealing with southern California’s Imperial Irrigation District (IID). The Desert Sun, which was central to exposing financial improprieties, identified nearly $100 million in billings and now-cancelled contracts involving ZGlobal. Those issues remain open.
ZGlobal will have a close relationship with MCE, particularly as pressure mounts for MCE to deliver on California’s growing requirement for increased energy volumes starting in 2021. These needs will include solar development, engineering, and procurement of energy from new renewable resources. Many of these areas are similar to those at IID.
Birds of a feather?
MCE’s selection of ZGlobal is telling of its decision-making and its peculiar attraction to companies embroiled in controversy. Previously, MCE became involved in a 120 acre solar development that failed, due in large part to less than competent management by MCE.
North American Power Group (NAPG) was to construct a 15 megawatt solar farm outside Sacramento, in Rocklin, California. MCE’s technical consultant, Kirby Dusel (Pacific Energy Advisors, located in Folsom, California, where ZGlobal is also located) referred to the contract with NAPG as a “fleeting” opportunity when recommending Rio Solar to MCE’s board.
In reality, Rio Solar existed only as a concept. While MCE’s technical consultants failed to grasp the multi-year time requirement for environmental reviews, MCE’s board believed Rio Solar was just months away from commercial production.
After coming to terms with NAPG’s zero-progress, including a sudden announcement to relocate the planned solar farm 300 miles south to Bakersfield, Rio Solar was quietly cancelled by Weisz.
The absence of Rio Solar’s energy was the equivalent of Marin County’s entireresidential electric load for three months. Contrary to its prior assurances, MCE covered the clean energy shortfall with RECs.
NAPG itself subsequently came under Department of Justice investigation (eighteen months ago NAPG settled charges involving its carbon sequestration project with the Department of Energy). The DOJ found NAPG’s owner “fraudulently transferred millions of dollars of award monies into his personal bank account and used the award monies to fund an extravagant lifestyle.”
MCE’s controversy was not limited to NAPG.
MCE entered into a $190 million solar contract with a San Diego company by the name of enXco. MCE selected the firm over California’s SunPower and domestic supplier LSPower. Weisz was careful to refer to “enXco,” ignoring the identity of the company that actually owned enXco, when trumpeting the solar contract to Marin cities, during MCE’s update tour about MCE’s success.
A firestorm ignited when Marin residents discovered that enXco was a subsidiary of Électricité de France (EDF), the world’s largest nuclear power company, headquartered in Paris.
The uncovering of EDF, which should have been an embarrassment for Weisz, who also touted MCE’s rejection of nuclear power and calls for the closure of PG&E’s Diablo Canyon nuclear power plant, only galvanized her resolve about retaining her rightful place as MCE’s leader.
MCE went on to execute a 20-year contract valued at $200 million for energy from "Desert Harvest." MCE's website, which identifies the 2016 agreement asResolution T2016-01 takes viewers to some other agreement. According to a table in MCE's 2018 Integrated Resource Plan, Desert Harvest is owned by EDF.
To most public administrators, MCE's behavior would have been awkward for an agency that claimed transparency and community allegiance as justification for its existence compared to PG&E.
None of it mattered
For Weisz, a former county Planner earning $54,000 per year and now making $320,000 at the helm of MCE, all of this was simply noise as Shell faded from the headlines. ZGlobal marked the close to a public relations fiasco.
With Shell’s departure, Weisz & company wiped their hands and declared they had delivered on what was promised to the public. Shell was gone. That box was checked… in pencil.
Now it was time for Weisz to get back to work.
There were issues involving MCE’s shifting positions on RECs; and operating costs that MCE and other CCAs had, for the time being, off-loaded onto PG&E. And, most urgent of all a looming threat to CCA independence and its “self-regulated” existence from the utilities commission that was beginning to piece together energy problems in California that were caused by CCAs.
But first things, first. Weisz’s immediate priority was the continued shaping and controlling of the public narrative in order to better vanquish MCE’s critics. To achieve that, Weisz invoked a familiar posture that compelled her onlookers to take up a rallying cry, that caused local media to come to MCE’s defense, that compelled MCE’s board to circle the wagons around the MCE enterprise and cede its judgment to her.
The "Victim" -- Take 1:
When MCE launched into business in May 2010, PG&E sent a letter alerting customers to be aware of a coming energy change, that they would be switched into a program known as Community Choice Aggregation. PG&E’s letter was information only -- neutral on the merits of CCA. Compared to MCE’s Opt-Out notice, the primary difference was that PG&E’s font size was large and easier to read, whereas MCE’s notice was small and had the appearance of junk mail.
In response, Weisz acted as if she couldn’t believe PG&E’s egregious behavior. How dare the big utility company engage in these anti-CCA practices by sending such a letter. PG&E was acting contrary to AB 117, the law that created CCAs. Could the California Public Utilities Commission (CPUC) please help her reign in PG&E's anti-competitive actions?
That plea prompted the CPUC to shut down PG&E’s conversation about the advent of CCA with its customers. If PG&E protested, the Commission was ready to levy heavy fines. And if any customers called PG&E with questions, the utility was to remain neutral while those customers were switched into MCE.
Ironically, at the same time that the CPUC shut down PG&E’s voice, Marin consumers, who lacked an arbitrator, were complaining about MCE’s unfair Opt-Out practices.
Victim of the Unions & Sacramento – Take 2:
California legislators reacted to the shortcomings of CCAs, by introducing AB 2145. The legislation would change the Opt-Out mechanism to Opt-In, meaning consumers would have to take action and elect to sign up for the program, rather than automatically being enrolled, thereby eliminating concerns of gaming and manipulating the Opt-Out enrollment system.
AB 2145 created an instant backlash in the CCA community, who feared that they would not be able to build their businesses without the automatic enrollment feature. MCE claimed that AB 2145 was part of grand scheme that threatened jobs, cost savings, renewable energy, and of course, “choice.”
Of note, with the exception of three solar jobs that MCE claims, MCE has not created any on-going, full-time jobs in Marin, except those of its staff. MCE’s last cost savings compared to PG&E was six-hundreds of 1%, and its contribution to the renewable energy through the solar farms constructed through its "feed-in tariff program" is one-tenth of 1% of its total energy load.
A feed-in tariff is where a developer funds the complete construction of a solar farm and then receives a guaranteed fixed-payment for each megawatt-hour of energy that is delivered to MCE for resale. Except for public relations, MCE’s feed-in tariff program has been a financial loss – MCE pays more than twicecurrent market prices for its feed-in tariff energy.
To combat AB 2145 legislative efforts, Weisz again set up MCE as a victim to the CPUC and with State Senators in the Energy, Utilities, and Communications Committee.
MCE claimed that private parties, including the International Brotherhood of Electrical Workers (IBEW), were distributing “very inaccurate and misleading information” about Shell and AB 2145. MCE also claimed that this writer, critical of MCE since it began green-washing dirty energy with RECs in 2011, was part of a scheme that threatened MCE’s growth.
MCE asked the CPUC to shut down public discourse about MCE – a government agency-- and Shell and, most importantly, AB 2145.
The IBEW’s letter responding to MCE is included here.
Even though the CPUC did not act on MCE’s request, MCE successfully set the foundation for its showdown in Sacramento. CCA proponents packed the legislative chambers for a final vote on AB 2145.
MCE told legislators that the Opt-Out mechanism was its birthright, and that MCE could not survive without it when everyone was spreading rumors and bad news about MCE.
Besides, MCE claimed, communities everywhere were benefitting by its significant reductions of greenhouse gas (GHG) emissions compared to PG&E in the fight against global warming. (MCE averages 43% higher GHG emissions per megawatt-hour than PG&E from 2011 through 2015, the last year of available data).
State Senators took the temperature of the room and determined their re-elections were better assured if they didn’t alienate voters. AB 2145 was defeated, preserving CCA’s Opt-Out / automatic enrollment program.
Shaping the MCE Board’s perception
MCE’s board is comprised of municipal councilmembers from each city or town that MCE serves. None of the members are energy professionals and so they rely on MCE staff for technical guidance. Competent boards require a rudimentary understanding of the business they govern.
According to MCE’s board meeting minutes from June 2014, the board did not understand even the basic component of renewable energy, known as “Bucket 1.” This was after four years of operations.
This meeting occurred after MCE was exposed for doctoring its annual greenhouse gas emission rates after PG&E’s unexpectedly lower number was published. Two years later, MCE was again exposed for importing coal-fired power that it rebranded as “clean” energy.
In both cases, Weisz authored letters that obfuscated the truth and kept her board of non-energy professionals in the dark.
If there was any hope of someone directing MCE to begin operating with integrity, it wasn’t going to come from a board that took its cue from its CEO.
In her first letter, regarding MCE’s altering its annual GHG emission rate numbers, Weisz wrote that “MCE made a commitment to deliver a lower emission factor than PG&E, and that commitment was honored.” MCE’s revision-after-PG&E-announced-its-numbers was merely a “true up.”
MCE board meeting minutes, dated the same day as Weisz’s true up letter, identify that “Ms. Weisz responded to questions from the board specifically related to the correspondence received from Mr. Phelps.”
It is doubtful that Weisz shared thoughts with her board that were similar to those of California Air Resources Board Chair, who, five days later, wondered if MCE was engaged in consumer fraud.
In her second letter, Weisz denied that MCE’s import of “clean” coal-fired power had occurred, then claimed it was all “unexpected and unfortunate” misunderstanding before blaming Shell and the California legislature for her problem.
It remains unclear whether Weisz fully grasps what occurred involving coal imports and associated Bucket 2 e-tagging issues, because even though she signed the September 2015 letter, according to invoice records, it was authored by her consultant at Pacific Energy Advisors.
Ceding its authority
All agenda items and the vision of MCE fall to Weisz. Of the thousands of agenda items that board has considered since MCE’s May 2010 business launch, not a single “no” vote has been cast by any single member on any single item. The odds of this occurring in a company that is fully disclosing all aspects of its operations and decisions is probably zero.
Of note, MCE’s board is now 28 strong, 10 more than the largest corporate board on record – General Electric Company, which recently announced its board is downsizing to 12 members (the most recent enterprise value of GE is $243 billion).
Part 2 of this series will address (1) MCE’s cash horde; (2) MCE’s public rejection of RECs and its concurrent use of a front organization that lobbies for their continued use; and (3) MCE’s quid pro quo outreach where jobs are promised in exchange for favorable public relations in its coming fight with legislators and utility companies.
About the Author:
Jim Phelps is retired after serving the power, petrochemical, and geothermal industries for nearly 35 years as a power contractor and utility rate analyst. He is not now, nor has he ever been, employed by PG&E. He has not received any money from PG&E for his work tracking Community Choice Aggregation and Community Choice Energy activities. He has also completed consulting and thermal performance test work for Shell Oil, one of MCE's energy providers, at one of Shell's Gulf Coast refineries.
Mr. Phelps operates one of Marin's largest residential solar electric systems at his home in Novato. He also operates a solar electric system at another house in Placer County. Several years ago he initiated contact with PG&E about its carbon emission practices and with MCE about its emission practices. He also requested clarification from MCE and other CCAs about several business conduct issues, however, those CCAs declined to provide help. To this time, MCE’s only input about its business is to respond to Public Records Act requests identifying the costs for copies of public documents, or denying the existence of basic information, such as its procured volumes of system power.
Posted: Mar 11, 2018 12:01 AM
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The California Legislature passed many bills this past session that were signed into law which gave the government greater control of the housing market. This is a perfect example of invasive government creating a problem, blaming others for the problem and then creating even more rules to destroy the market even further.
The cost of housing in California is certainly a problem. The Business Insider identified that 18 of the top 25 most-costly housing markets in the U.S. are in California, with all of the top 10 being in the state. In a recent study by UC Berkeley, 56% of residents are looking at relocating due to the costs of housing, many moving to another state. Today just 28% of California households can afford a new home versus 56% in 2012 per a study by the California Association of Realtors.
Governor Brown signed 15 bills related to housing that were passed through the Legislature. These included a bill which would put a $4 billion bond initiative on the 2018 ballot. There is also a new fee of up to $225 on the sale of a property that would drive up the cost of housing, but be used to lower the cost of housing. One bill signed by Gov. Brown would revise the Housing Accountability Act and subject local governments to a $10,000 fine per housing unit if they do not meet the new rules and build affordable housing.
State Senate President Pro Tem Kevin De Leon (a candidate for the U.S. Senate) stated he was privately informed by members of the Los Angeles City Council that “We have been strangled, we have been handcuffed by NIMBYism and the threats from Neighborhood Councils.” This started a firestorm of outcry from the 2,000 members of local neighborhood councils who themselves are elected officials. This is all part of the fight over the interests wanting further housing development and others wanting preservation of neighborhoods. De Leon was characterized as bigoted and anti-diversity by some.
Many of the bills countered the mission of lower cost for housing. One bill signed requires that any private housing project that receives any public funding and is under agreement with a government agency pay union wages. The legislature got so detailed they passed another law which required union wages be paid to remove a tree – yes, a tree. Now the people who cannot afford housing in the first place cannot work on many of the projects that would enable them to live in that housing.
I spoke to Roger Davila, an Orange County housing developer, who told me that after 20 years he has gotten out of the low-income market. He said between the requirements placed on low-income housing by California and the local governments, together with the negative attitude of local residents toward the housing, it became impossible to build anything affordable. Davila said the bill to have the prevailing wage on private projects will drive the cost of development out of sight. He stated “They may be well intentioned, but they really don’t understand the effects of their legislation.”
The National Association of Home Builders (NAHB) study showed the regulations add just shy of $85,000 per unit of housing nationally. You can be assured those costs are even higher in California. But none of these bills addressed those costs.The bills just created more invasive government involvement in the housing market.
This is a patented process by the Left to take over an area of the economy. First, they see a problem; then they express outrage at the problem and suggest governmental solutions to the problem. When the governmental solutions fail, they suggest more governmental solutions and then more governmental solutions until they have nearly completely destroyed the free market. When that happens they completely take over that area of the economy and point fingers at the free market and say it is their fault.
Two prime examples of this are in California (and many other states’ legislatures) which loaded up health insurance -- adding minimum requirements like covering pre-natal care and chiropractors -- that the cost of health insurance became unaffordable to most. They then declare a crisis and further interceded in the market by passing Obamacare. Now that market is falling apart because their solutions have driven costs out of sight. The other example was when the federal government took over the housing loan market through Fannie Mae and Freddie Mac. They kept on layering the program with requirements for ridiculous loans. The market collapsed and they pointed fingers at the bankers instead of the laws.
Joel Kotkin, the Presidential Fellow in Urban Futures at Chapman University in Orange, CA, stated in a recent column “At the heart of the problem lie ‘urban containment’ policies that impose ‘urban growth boundaries’ to restrict — or even prohibit — new suburban detached housing tracts from being built on greenfield land. Given the strong demand for single-family homes, it is no surprise that prices have soared.”
You can believe that these 15 laws will further destroy the free market for housing and do next to nothing to resolve the homeless crisis in California which has to do with the cost of housing and other factors such as mental illness.
In five years, they will be back addressing the newly-branded crisis that these 15 laws did nothing to resolve with 15 new laws further taking over the housing market until there is no affordable housing in California. And then we will become Venezuela.
Wednesday, March 14, 2018
From Marinwood CSD Director, Eric Dreikosen on 3/14/2018
With all sincerity, I would genuinely like to know why you feel the threshold for paying prevailing wages on public works projects is $25,000? Please cite the specific government code you believe supports this and I will gladly research it further.
From Stephen Nestel on 3/14/ 2018:
From Stephen Nestel on 3/14/ 2018:
Dear Eric, Chief Roach, Marinwood CSD board members, Marin IJ staff and Marinwood Taxpayers:
You are correct to be concerned about following government contracting law, especially after so many missteps during the kitchen bidding process. When the problem with Kitchen arose in February 2017, you did not know that Governor Brown had changed DIR law to allow small projects under $25,000 on January 10, 2017 to take effect on July 1, 2017.
Keeping current on changing laws can be challenging, however in May 2017, I believe you acknowledged the law would be changing on July 2017. You have persisted with a misunderstanding of the law insisting that the contract could only be satisfied with a DIR approved contractor at a great cost to the district .Only ONE CONTRACTOR, who coincidentally a personal friend of the Chief and Marinwood CSD member was considered qualified.
This is false. Contractors on small public works projects DO NOT have to be DIR contractors but they need to pay prevailing wages and keep records. That is quite a different interpretation than the one reported to the board. It seems to me that reason the small projects exception was created was to allow small districts to get projects done without a cumbersome DIR contracting process. The DIR contractors are not interested in these small projects either.
All the law says is that if the project is less than $25,000 is we do not have to adhere to the DIR process. If we pay more than $1000 in wages, we must pay "prevailing wage". This seems fair to me. We will pay union wages and get the job done quickly by contracting this directly. The electrician and plumber will likely charge union wages anyhow. The cabinets are manufactured in a factory (just like the one's that DIR contractor would provide) and are not a factor and the only other labor is the delivery and installation by Granite Expo.
I have no idea if Granite Expo is a union shop. My guess is that it is not. In this case, I suggest we get a bid from them on labor and recalculate it for "union rates" and offer to pay them a higher wage rate if you feel this is necessary.
Marinwood CSD and FD will comply with the DIR law by paying fair wages and will also get a good price from the granite expo, get the kitchen installed by April 15, 2018 and save taxpayers thousands .
Lastly, I hasten to point out that the district regularly employs/contracts people at "non union" wages all the time. Pool maintenance, delivery sales people, air conditioner repair, grounds, cleaning, etc. I personally don't think this project is exceptionally different.
So let's make this project happen. Go to www.thegraniteexpo.com today and pick out the exact cabinets and countertops and sign the order. The firemen will be happy, you'll save money and make the Marinwood CSD district proud.
Tuesday, March 13, 2018
Dear Chief Roach, Erick Driekosen , Marinwood CSD Board members and Marinwood CSD taxpayers:
As promised, here is a quote for the Marinwood Firehouse Kitchen with all wood cabinets, granite countertops and an all stainless steel Frigidaire appliances. Installations are generally booked 30 days in advance. The Marinwood Firefighters could have their new kitchen as early as tax day, April 15th.
Garnet Tops $564.82
Installation Labor $3800.88
Appliance Bundle $1944.18
Total Cabinets, Granite Countertops with All New Appliances including installation $9909.14
Price does not include incidental electric and plumbing and wallboard repair.
This quote is under the DIR limit of $25,000 and leaves over $15,000 for plumbing, electrical and/or savings for other Marinwood CSD projects
Quotes received on 3/13/2018 from www.thegraniteexpo.com They have a massive showroom with many choices. The quotes are for midrange all wood cabinetry and granite. A personal visit to their showroom can provide you with first hand experience with their quality. They are the number one wholesale/retail provider of kitchens in Northern California.
1368 40th Street
Emeryville, CA 94608
The district can save over $50,000 in taxpayer funds from the previous DIR proposal and invest the savings in new playground equipment, an outdoor stage, a new maintenance shed, or add to our cash reserves.
Its easy, inexpensive and a popular choice for contractors and homeowners. Why not save the taxpayers money?
P.S. As a special bonus, I am including a quote for a 24' steel maintenance shed for $11,520. that is used by municipal parks departments the world over. There is no need for a custom shed when serviceable sheds can be had for a fraction of the cost of an architect designed shed. No need to spend $100,000s on a utility structure. It can be hidden behind a berm and planting next to the fire house.
|The firefighters will get their "Martha Stewart" kitchen makeover at a fraction of the previous estimates.|
As a disclaimer, I’m not categorically against any type of development, be it prefabricated, modular homeless housing or 100 story luxury apartments. If a city wants to build the tallest building in the world, that’s fine if it’s their decision to do that. What I am against is top-down planning by government and big money, forcing inappropriate development on defenseless communities, by commandeering local planning and zoning control and dictating to locally elected officials and taxpayers.
I’m also not an “urbanist” or any other “ist” for that matter. I love great urban places as much as I love quiet small towns. Each has its unique and compelling characteristics, and I think we should work to preserve both. If I need a label, I guess I’m a quasi-Wrightian when it comes to planning and growth. As anyonewho has read my first book or my work over the years knows, I believe that growth and planning requires complex solutions, incorporating a mix of low-density and high-density, enabled by technology so both have a much lighter footprint on the planet than either do at the moment.
What I know for sure is that a one-size-fits-all approach to zoning will not get us there.
When dealing with development issues in different places, from urban cores to rural towns, nothing is comparable: not available locations, land types, the social services and public services available or the needs of the populace or the programs that exist to address them, or the types of businesses and industries that are viable, or the municipal government’s financial wherewithal and the capacity of their agencies.
In the face of increasingly complex planning and growth challenges and increasingly unpredictable unintended consequences, Senator Wiener has chosen to ignore all this and charge forward with a blunt instrument belief that removing local zoning control will solve everything. His proposals have no proven track record of success: success being defined as financially, socially and environmentally viable in a market based, democratic society.
I’m not claiming that our system is not flawed: in many ways it’s a total mess. Still, like it or not, for better and for worse California is not Europe or Asia or even New York City, so we have to work with what we have. And, on balance, I would argue that what we have in place can work well, even though new ideas and modifications are needed.
But, Senator Wiener doesn’t live in that world, which is why the visions embodied in his Senate Bill 827 are fatally flawed.
Fatal Flaw #1: Local Planning is not just about control
A city’s General Plan and its zoning ordinances are not about “control” for its own sake, they are fundamentally about the financial solvency of the city. Over centuries, municipalities have sought to address and express their social, environmental and financial needs and goals through planning: adding provisions to encourage different types of commerce to provide jobs, services and tax base, or to improve infrastructure or bring in new residents (aka consumers), endlessly seeking a balance, though that is always unattainable.
The detailed decisions that go into creating a city’s General Plan attempt to address the fact that financially viable private development (housing, commercial, industrial, etc.), requires a supportive context of public investment and reliable planning execution.
Every municipality I’ve ever worked with has indicated that housing is at best a financial break even for cities: the costs of infrastructure and public services outweigh the revenues generated (and this is in California: the highest taxed populace in the country). Commercial properties, on the other hand, are generally a more reliable revenue source.
For example, a single 100 room boutique hotel in Marin can generate over $1 million a year in tax revenues. Conversely, allowing too much housing without sufficient commerce, retail, industry, local jobs and services results in reduced city revenues and public services, which lowers property values and so on, in a downward spiral that bankrupted more than one city in the last boom and bust housing cycle.
In the San Francisco Bay Area, allowing the addition of uncontrolled amounts of housing throughout our nine counties, without sufficient, local jobs creation and commercial development, also leads to longer commutes and more traffic.
Local planning can address these kinds of imbalances better than central planning agencies in Sacramento.
Planning and zoning work best, when applied surgically and with specific intentions. Conditional use zoning is an example of that. It offers the possibility of a certain profitable use for a developer, if the community receives some tangible benefit in return.
In addition, real estate developers and investors need a sense of certainty and depend on the fact that the goals and doctrines found in the General Plans, Specific Plans, Community Plans, Master Plans, Special Assessment Districts of public agencies will come to pass. However, that consistency and follow-through on long term, public agency planning is critical not just for private investors, but also for every family that buys a home and every entrepreneur who opens a small business and to the community at large that makes decisions based on those plans.
Municipal planning documents take years and thousands of man/woman hours to come into fruition and they embody layers of detailed decisions about every aspect of what makes a city a city, and those decisions are eventually encoded in local zoning ordinances. To cavalierly disregard the results of this process is madness.
Mr. Wiener fails to or perhaps doesn’t care to understand any of this and wishes he could do away with all of it. He seems confident that he’s the smartest guy in the room.
Fatal Flaw #2: If you build it near transit, will they come?
When one considers public transportation, it would be naïve to believe that just having a ferry terminal or a train station somewhere will result in financially viable, privately funded development. Want to buy a mall? I know where you can get one cheap, near good public transportation. As noted, planning, zoning and outcomes are more complex.
Similarly, to enforce strict definitions of what is or is not “transit rich” as the basis of legislation for the entire state, regardless of whether it’s an urban core or a rural neighborhood and devoid of context, available public-private investment, location, topography, construction type, design, unit sizes, amenities available or infrastructure required (all of which are the purpose of local planning) is completely nonsensical.
Mr. Wiener’s legislation treats a suburban bus stop the same as an urban ferry terminal. At the same time, his legislation doesn’t even bother to address our more urgent need, which is for better public transportation. It only assumes transportation’s value, mathematically. This, however, is not how real planning works.
Good planning involves taking everything into consideration – job growth, tax base, schools capacity, commercial demand, housing needs and types, infrastructure and public transportation options – and using that to create viable, long term, General Plans in coordination with public investment.
That Wiener fails to acknowledge the relationship between sustainable growth, development and local planning would be bad enough. Worse still, he proposes to predicate zoning decisions on transit frequency.
Fatal Flaw #3: Zoning based on bus route frequency
As I’ve argued, the existence of transit by itself is not a rational basis to drive zoning and development decisions. Transit alone will accomplish little, out of context, and development that is only driven by that transit has less chance of thriving. But, tying zoning and development directly to bus frequency is even more irrational.
Demand for bus service is dependent upon everything else that is outside of the control of that transit system. That is why, without predictable long term planning and the investment of public and private funds that go with it, Wiener’s version of “transit oriented development” near bus stops will not only fail, but will create zoning chaos.
First off, there is a huge difference between fixed transit (trains, highways, ferry terminals, airports, etc.) versus surface street transit (buses, shuttles, taxis, etc.). One is essentially permanent and a long term investment, while the other requires little investment and can change at any moment.
When it comes to zoning, fixed transit is far more certain than surface street transit, which is why major real estate development analysis tends to discount surface street transit (except for automobile and truck access), when evaluating opportunities. Still, it’s important to acknowledge that even trains and ferries change scheduling, depending on demand and ridership, so tying their frequency to zoning is still problematic.
There is no doubt that buses and shuttles are an important form of public transportation. However, bus routes are constantly changing based on ridership, so what happens when bus frequency suddenly rises above or falls below SB 827’s frequency criteria?
Will cities then be required to immediately up-zone or down-zone large swaths of land as bus intervals rise and fall? And, how will a city or a developer deal with zoning that is in constant flux and essentially unpredictable?
What if a street is “transit rich” one year but not the next, and in the interim a developer has broken ground on a housing project? Does that neighborhood then end up with high density housing but no public transit, because the municipal agency decided to reduce the bus frequency or worse, move the bus route somewhere else, entirely?
For all intents and purposes, Wiener’s legislation hands zoning control over to the Director of the MTA in San Francisco, or the Golden Gate Bridge, Highway & Transportation District bus service.
Now add this to the mix. Surface street transportation is presently in the midst of its most disruptive time since the invention of the automobile. And, on demand shuttles, flexible route, app-guided, more efficient, cheaper, just-in-time services, and even autonomous technology-enabled options are about to transform the sector even more.
In New York City, for example, the emergence of Uber and Lyft have made the once prized taxi medallion, which ten years ago was worth $100,000, practically worthless. In the coming decades, it’s possible that there may no longer be any fixed municipal bus routes at all. Unless public transportation is transformed, it may not be able to compete.
What will the residents of Wiener’s high density housing projects that were built based on bus frequency, do then, when public transit systems cut back service to remain financially solvent?
Will any of this happen with certainty? No one knows, but the trends we’re seeing would suggest caution and strengthening coordination with local decision making, not weakening it.
Fatal Flaw #4: High density development without parking
There certainly are arguments for development at varying densities at major fixed transit locations. The question though, in our fully developed communities, is where do we find the land for that development? Unfortunately, according to Wiener, it will be at the expense of parking.
Believing something is so, because you say it so many times that you convince others that it’s so, only works for con men and politicians, though I guess that’s redundant. The rest of us have to live with the consequences.
Driving and having parking when we get where we’re going, is essential for shopping, doctor’s appointments, school drop-offs, errands, and so much more. If we can't park at our destination, it's likely we'll go somewhere else. So, it is equally essential to all the merchants and service providers we are visiting, because without somewhere to park our cars we couldn’t get to them to buy their goods and services.
We no longer live in a world where getting to everything we and our families need is walkable. In fact, since the succession of disruptions caused by big box retail and online sales and resultant concentration of commercial, medical and retail development, almost nothing is walkable anymore. It’s only in an urban core with a lot of public transportation (e.g., New York City) that one can get to most things without a car. And, even in many of those place, in spite of increases in investment in public transportation (Los Angeles, Portland), ridership of public transportation is dropping as people are choosing to use other transportation services that save time and allow them to make multiple stops and carry heavier items, and according to some, because transit investment itself displaces those who use it most.
All this considered, parking remains the life blood of local businesses and particularly parking no more than a couple blocks from a store. This is is even more the case for small, mom and pop businesses and all local service providers, who do not have big advertising budgets.
When the Miller Avenue Streetscape in Mill Valley was redeveloped, many small, local-serving businesses barely hung on, because people just wouldn’t put up with anything that makes them walk too far or takes too much time, even though new temporary parking was arranged several blocks away. They simply went elsewhere.
This logical tendency of people to optimize their time and convenience means that commercial development (offices, restaurants, retail shops and service businesses) cannot survive without parking.
Wiener’s legislation rejects this reality, entirely.
But, ask yourself this. How can SB 827 supporters suggest that agencies such as BART, eliminate their parking lots in order to build housing near transit? What happens to all the people who used to drive to the BART station to go to San Francisco or elsewhere? They’ll be left with no alternative but to drive to San Francisco and try to park there.
And, let’s please start being realistic: people over forty, who are in their prime working and earning years, will not generally ride their bikes 15 miles back and forth to work every day, particularly if their day consists of multiple meetings out of the office. It's just nonsense.
Similarly, if the development that replaces a parking lot is mixed-use, where will customers patronizing the retail stores park? Only small convenience outlets can survive if frequented only by BART passengers.
Fatal Flaw #5: Is pollution from cars the impact we have to plan for in the future?
Government and politicians move so glacially that they always tend to be fighting the last war. The current environmental issues surrounding the transit oriented development debate are like that.
The TOD argument of last resort is that getting people out of cars is our top priority, because of the environmental impacts. Historically, that was true (this policy came out of the 1970's when air pollution choked every major U.S. city), but alternative fuel, automotive technology is being adopted rapidly, as is the legislation to mandate it. In fact, a number of countries around the world have already set dates by when the internal combustion engine will be outlawed, and California may soon follow suit.
As I've argued over the past ten years "personal transportation vehicles" -- be they cars, trucks, motorcycles or new hybrid forms -- are here to stay. They are analogous with freedom and choice can adapt to every conceivable need (business meetings to vacations). And, with advancements in technology and new legislation, housing, automobiles and greenhouse gas emissions are rapidly decoupling.
Looking out into the future, which is what we're supposed to be planning for, the entire "TOD lowers GHG auto emissions argument falls apart. But, there are also financial consequences to consider.
Large-scale development requires enormous amounts of capital, both public and private. We should always ask if that investment is the best way to achieve our goals. Even if one were to agree that we should get all older, polluting vehicles off the road right now, to reduce emissions (something I advocate), is high density development the quickest and least expensive way to do that?
In 2010, some of us did a quick financial analysis of a 30 unit, high density housing project that was proposed in Mill Valley. That analysis showed that buying zero emissions, hybrid electric cars for all the future residents of that project would cost the taxpayers only about 25% of the value of the public development concessions needed to approve the apartments.
I'm not suggesting that this means we shouldn't build any housing, but it shows that there are more immediate and direct ways to address greenhouse gas emissions. How about just offering a 50% of cost trade in credit voucher to anyone who will replace their low mileage, high emissions vehicle with a new alternative fuel hybrid? We could transform the public fleet within years not decades.
Fatal Flaw #6: Displacement is not just about residents and housing
I’ve often said that all things being equal there can be no affordable housing without subsidy. In Wiener’s version of this, his legislation’s massive property rights give-away is that subsidy, which in his telling of it will magically result in for profit developers building so much housing that it will eventually become more affordable.
Aside from the fact that there is no evidence that increasing development and giving away development rights will decrease housing costs -- in fact, quite the opposite, because added development rights increase property values -- the falsehoods in this argument are too many to tackle here. So, I’ll confine my comments to those concerning the impacts on communities that will become designated as “transit rich,” under SB 827 (for a detailed discussion about realistic ways to create affordable housing click here).
In short, if Wiener’s vision is allowed to be realized, the majority of the San Francisco Bay Area’s long-standing communities will be decimated.
Gentrification and displacement in communities resulting from new, high density development tied to transit frequency, is not just about the plight of the poor and other disadvantaged populations -- though they are hit the hardest by it. Displacement within impacted communities will be equally destructive to local-serving businesses.
“Communities” are ecosystems comprised of a wide variety of participants engaged in intricately inter-dependent activities. In addition to residents, local-serving businesses include tire stores, auto repair shops, hardware stores, stationary stores, hair and nail salons, florists, tattoo parlors, yoga studios, mom and pop restaurants, light manufacturing, service providers like plumbers, cabinet makers, electricians, artisans and artists, writers, accountants, lawyers, architects, contractors, local nonprofits, and personal and medical care providers of every imaginable kind.
Most of these are small businesses. Many of them only remain viable, because their rents in older buildings are still reasonable.
To suddenly up-zone and transform property values to attract high density, mostly luxury housing and large-scaled commercial development, and to believe that rents will not rise and that existing communities will remain intact is just fanciful. With legislation like SB 827 we are looking at wholesale displacement of communities and their unique cultures.
Shiny new buildings and rising rents in close proximity, will inevitably drive out and replace struggling, local enterprises with coffee bars, trendy restaurants, boutiques, wine shops and art galleries.
And, in all this, we haven’t even talked about the impacts on the environment from this uncontrolled development, using the same bricks and sticks construction methods we’ve used for 60 years. It is amazing to me that Wiener and his fellow legislators are so willing to throw environmental protection under the bus to benefit multi-billion dollar (soon to be trillion dollar) corporations.
There was a time California was the leader in this. Now our politicians just carry water for major donors who will benefit from uncontrolled development.
In any case, if you identify with any of the local services, professions or businesses I’ve listed above, and you live within the ½ mile or ¼ mile of a “transit rich” area, as prescribed by SB 827, I suggest you either start fighting back or start packing.