Tuesday night, the Berkeley City Council is holding a special meeting to hear an appeal by local residents fighting a 6-story building in South Berkeley approved in late October.
The city’s Zoning Adjustments Board approved the 50-unit building, at 2902 Adeline St., after a lengthy hearing, and an appeal to council was expected. Many neighbors of the project have opposed it since developers presented it to the community in 2015. The item is the only one on Tuesday night’s special meeting agenda.
Local resident Robert Lauriston filed an appeal Nov. 3 on behalf of himself and 29 other signatories, including many nearby neighbors of 2902 Adeline. Lauriston wrote, in a letter to council dated Feb. 21, that “the central argument of our appeal is not that the ZAB failed to interpret the law correctly, but that in exercising its discretion it fell well short of the best possible deal for the city.” He said other decisions made by the zoning board, related to increased project height and lot coverage, and reduced off-street parking, “were all granted at the ZAB’s discretion.” He said a more robust response to the staff report would be forthcoming.
The project includes about 4,100 square feet of commercial space, part of which would be used by four live-work units. Two of the 50 apartments would be designated as affordable to very-low-income households who make less than 50% of the area median income (AMI), and two others would be affordable to tenants who make 80% of it, as per the agreement reached before the zoning board. The developer would also pay $884,000 into the city’s Housing Trust Fund to build affordable housing elsewhere to comply with city rules related to below-market-rate housing. Attorneys for developer Realtex told council in a Feb. 28 letter (Item 4) that more than 110 community members have pledged support for the project.
City staff recommend that council approve the use permit to allow for the development of three parcels, including the one where AW Pottery operates; its owner plans to retire and relocate, according to staff. The proposed project would demolish existing buildings, merge three lots and construct the new building, which includes stacked parking for 24, and 56 bike parking spots along with a bike repair station.
Staff notes that the project sought, and received, a concession to allow it to exceed the district’s floor area ratio as part of its use permit to reach 6 stories. But according to a new law, effective Jan. 1, the city does not have to approve that concession if it does not result in cost reductions tied to affordable housing. And staff says, in this case, it does not.
According to the city, the appeal raises seven points. The appellants take issue with the way the city calculated the number of affordable units that are required. Staff says the appellants are wrong about their interpretation of the rules.
The appellants also say the zoning board should have pushed for “a better deal” and required mediation with neighbors. City staff said it’s not the job of the zoning board to negotiate, and it was clear mediation would not have worked because the neighbors were pushing for community benefits rather than design changes. Community benefits are not required in the district where the project is proposed.
The appellants said the board failed to apply part of the state density bonus law related to rent-controlled units; staff said none of the units at issue are under rent control, so there was no reason to consider that.
Appellants also took issue with the financial analysis, or pro forma, submitted on behalf of the project, calling it “inaccurate.” City staff said it hired a professional land economics consulting firm to review the document, as well as a third-party consultant to peer review it, “and they verified the assumptions and calculations in the analysis.”
Appellants say the project is not compatible with the neighborhood due to its size. Staff says the zoning board considered this and ultimately found the 6-story building appropriate, among other reasons, because the building would be on “one of the broadest intersections in the City” and across the street from another 6-story building on Russell.
Appellants say, too, that “Approving more market-rate units than are required by law is contrary to city goals.”
City staff says that’s not right: “Contrary to the appellants’ statement, approving a net increase in the City’s housing supply at any income level is supportive of City Policies” related to economic diversity, transit-oriented new construction and regional housing needs.
Staff says council basically has to approve a 4-story version of the project, as per state law, writing, “As a project employing State Density Bonus law, the Council may not preclude the construction of the base project with density bonus units, which is a four story, 25 unit project, with two dwelling units, affordable to Very Low Income households.”
The use permit needed for the fifth and sixth stories, however, is left to the city’s discretion.
According to financial papers submitted by the developer as part of the peer-review process, the 6-story project will generate a 5.6% rate of return. That’s reportedly less than it might expect from “similar projects,” but still “financially feasible.” A smaller project, however, would not pencil out, according to the reviewer.
Before the special meeting at 7 p.m., two items are scheduled for a 5:30 p.m. council worksession: a new housing demolition mitigation fee, proposed to be set at $105,202 per unit, and a workshop on “Financial and Infrastructure Opportunities,” presented by Council Members Linda Maio, Ben Bartlett and Lori Droste. According to workshop materials, the low-interest-rate environment makes it a good time for the city to refinance some of its bonds.
Council will discuss those items but no action takes place at worksessions. See complete agenda documents for the worksession on the city website.