The Making of an Endorsement

First Impressions

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Oct 3, 2008, at 5:43 PM

Lee Nichols:

My two cents: I'm not real big on legislation by referendum, and I don't see why, if these payments are optional anyway, that people can't just apply political pressure to the council and have it done from the dais. Maybe I'm being naive as to the effect citizens can have on the council, but it just doesn't seem like this should be set in stone with an charter amendment, or at the least the amendment should ban deals going forward and not apply to this one.

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10/3/08 6:46 PM

Katherine Gregor:

I basically concur, at least at this point

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10/6/08 8:34 AM

Katherine Gregor

I also asked [Lee Leffingwell] if he could have someone get us specific numbers on what the long-term costs would be of having COA's bond rating drop. Such as: Losing one grade = 1/4% more interest paid x amount borrowed over XX years = projected cost to city. He said he'd try to have someone get back to us.

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10/6/08 10:48 AM

Nick Barbaro

[Councilmember Leffingwell seemed receptive to the idea that, if Prop 2 doesn't pass, council could still ask Simon to "voluntarily" renegotiate the Domain agreement, with future "voluntary" payments tied to additional specific performance measures required of Simon.]

As usual, of course, I wonder why such sensible and obvious courses of action only occur to council under the threat of electoral fiat, and not when it could actually matter (such as when they were asked to pressure Simon into putting in more internal connectivity (bike lanes, sidewalks) and declined, or when they were asked to put some strings on the upcoming first payout to Simon and declined).

"Yeah, we've never done it in the past, but we might do it next time" doesn't do that much for me.

Which of course makes me equally skeptical of Lee [Nichols]'s eminently sensible suggestion that a more logical way to approach this is that "if these payments are optional anyway, that people can just apply political pressure to the council and have it done from the dais."

There's a depressing wealth of evidence that it takes tons and tons of (unpaid, volunteer, unorganized) citizen pressure to offset the ingrained (professional, lobbyist-paid) developer pressure applied behind the scenes at City Hall.

(Jason, I need an illo here: Long fulcrum, lots of angry citizen activists jumping up and down on the short end, right in front of the council, who are perched on the balance point, and then a developer lobbyist, way back behind them, deep in CH, with just a finger on the lever, counterbalancing them. Thanks.)

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10/6/08 4:32 PM

Richard Whittaker

I think an illo to represent Simon accepting a re-re-written contract

would involve ice in Hades.

I'm unconvinced, if prop 2 fails, that there would be any political

imperative to cancel payments (especially since the counter-argument would be that the city was over-ruling the will of the electorate, who had voted to back 380 agreements for retail - hell, if I were Simon's attorneys, that's what I would say.) and I don't see a renegotiation happening.

I'm also not sure that's the real argument, which I think has to be

whether there's any veracity to the claim that this damage the city's bond

rating. Plus, and I think this is something that we haven't really

discussed, what this does is ring-fence developments with a retail

component from receiving financial incentives, and I'm still not sure that

I've heard a convincing argument for "Hey, you have a store in your

development - no soup for you!"

For example: Chapter 380 agreements are intended to provide financial

incentives to big single employers (factories, financial houses, etc) to

encourage them to move into an area. So if a factory has a factory store,

does this mean that they would be caught up in prop. 2? How would

incentives to an Alcoa plant be a better deal than a hand-crafted

furniture factory with an on-site store?

Plus, as has been discussed previously, there are deep concerns about

using charter amendments to make policy.

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10/6/08 5:18 PM

Nick Barbaro:

And, no, we haven't seen any evidence that this would damage the city's bond rating, but there seems to be near-universal agreement (at least at the moment) that cash incentives for retail are a bad idea. It was interesting that LL seemed to see no problem in separating out non-cash incentives for retail (i.e. in TODs); presumably, to use your furniture factory example, the factory would apply for available incentives, leaving its outlet store to sink or swim on its own merits, which seems right, to me.

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10/6/08 5:49 PM

Richard Whittaker:

But I'm not sure why either side seems to be saying that "retail

bad/everything else good." This is a state littered with city hand-overs

to sports teams and a coterie of other forms of business, and I'm really

unsure why there's hand-wringing from SDS about retail rather than, say,

wholesale or manufacturing or residential. That's what's baffling me here,

because I'm unsure what the argument even is for a qualitative difference.

I'm deeply agnostic on this issue, still.