OakDOT and HCD Describe Disastrous Outcomes for City Infrastructure and Affordable Housing Without Measure U Bond Sales This Year
During fraught budget deliberations last Summer, officials suggested that one outcome of budgeting with future Coliseum sale revenue could be a downgrading of City bond ratings that could reduce their potential value and cause investors to forgo investing in them if sale revenue never materialized. City Administrator's Office [CAO] and Finance Department Director Erin Roseman warned Council members that such an outcome would prompt the City to forego issuing FY 24-25 Measure U bonds in the coming months. In anticipation of the possibility of withholding the second issuance, Council’s contingency budget removed Measure U funding from OakDOT’s paving plan and other projects, effectively reducing it to zero for the FY 24-25 budget year.*
The outcome did come to pass. The Coliseum sale has been stalled since last September in arduous negotiations with a County administration that previously sold it's share of the Coliseum to the A's in an expedited process with no strings attached. With no Coliseum revenue, the contingency budget was implemented—Measure U fed projects greenlit in the FY 24-25 budget passed in July based on a budget with Coliseum sale revenues now lack a budgeted funding source. The Housing and Community Development's seed funding for AH developers [known as NOFA*s] and the major funding for paving and other uses in OakDOT went from nearly $200 MM [$130 MM for housing and $55 MM for OakDOT infrastructure] to zero over night in October.
Roseman's prediction of a reduction in the city’s bond ratings did come to pass as well, though there is an open question about what made that happen. At least one bond rating report mentions the City Administrator’s Office failure to reign in massive levels of OPD spending as a primary factor.
But the decision to forego the bond issuance never came before Council as such. And the City never truly made public or widely known that the Finance Department, with the support of City Administrator's Office in the weeks after the recall of Sheng Thao, apparently did make the decision to withhold the bond issuance.
Policy crafted in the ensuing weeks from CM Rebecca Kaplan and former Council President and CM Nikki Fortunato Bas, found ways to allocate about $21 MM in alternatively-sourced funding to at least ensure a few projects—like a protected bike lane around Lake Merritt—would go forward. That process confirmed that Measure U bonds would not be sold that fall for the fiscal year that ends June 30, 2025. The Council did give direction to the CAO to issue the bonds in the same legislation, however, though there doesn’t appear to have been any action to do so as of this writing.
Now, as the City begins budgeting for another year of economic instability, OakDOT and Housing and Community Development staff warned the Community and Economic Development Committee [CED] members that further delay in bringing the bonds to market could have disastrous outcomes for the City’s infrastructure and affordable housing.
At the March 25th meeting , Assistant OakDOT Director Jamie Parks told CMs that the contingency–budget’s failure to issue the Measure U bonds in the fall, when it was expected, delayed paving contracts and curb and sidewalk construction. Without the bond funding, OakDOT will have to rely on other grant funding and on internal crews—only enough to fund 10 miles of paving per year, not the goal of 50. Certain grant-funded projects, like the 42nd/High Street improvement project would be delayed, and new grant-funded projects would not have the local match required to meet grant requirements. And vacant positions meant to do those jobs would be frozen.
A 2025 without Measure U bond sales would be worse for the City’s funding stream for affordable housing—City Council forward-funded NOFAs* from the promised Measure U funding in 24-25. Five developers used the promised funding as leverage for state tax credits in January for shovel-ready projects—grants which will have to be returned if the projects lack the funding to proceed within six months. The lack of U funds imperils projects across Oakland, from the “Liberation Park” project at Eastmont, to Mandela Station, to 34th and San Pablo.
Staff also highlighted a cascade effect from a failure to meet the grant requirements. The State could see Oakland-funded projects as having unreliable fund partners, as the City loses credibility for completing its affordable housing commitments. The ACAH program, which seeks to convert existing housing into permanently affordable units would suffer, and the Extended Stay America transitional housing project envisioned as an output for the City’s homeless interventions, may never see fruition. The City would also have to pull back on future projects for the successful Homekey grant program.
Statements by the City Administrator at the meeting imply that the CAO plans to move forward with a bond issuance in the coming fiscal year that begins in July—but they remain vague. Both Kaplan and CM Zac Unger prodded Assistant City Administrator, G. Harold Duffy, at the Public Works meeting to confirm that the CAO planned to move forward with bringing the bonds to market.
Duffy replied to Kaplan’s direct question by saying CAO Jestin Johnson “has informed me that he is in the process of pulling together the appropriate resources and to report to the council for a bond sale in 2025.”
Duffey later added in a response to Unger, that the City Administrator’s office has been weighing pros and cons of moving on bond sales with a slightly lower bond rating, vs the impact of delaying paving and affordable housing projects.
“I think that that discussion over the year has come to a head, and I think we are moving forward in the process. Based on what the city administrator told me, he's lining up all the resources to come back to the council to talk about the feasibility and timeline for selling measure U bonds in 2025,” Duffey said.
At Rules on Thursday, Council members tried to pin down the CAO to commit to a written, not just verbal, overview in a bond issuance status report item. By the end of the discussion, the City Administrator agreed to a written report and the item was scheduled to the April 14 Council meeting, after spring recess. Notably, the Finance Department was absent from the discussion. The report won’t be available until April 11, as special meetings have shorter noticing requirements.
10 Year Ballers Lease Advances to Council
The City Council is set to consider, and likely approve, a renewal of the lease for the Oakland Ballers baseball team at Raimondi Park, the formerly distressed West Oakland site that the Ballers refurbished and turned into a semi-professional ballpark last year through an initial one-year contract in 2024. A Community and Economic Development committee meeting deliberation on the proposed deal last Tuesday often took on the tone of an exuberant celebration of a future deal.
The Ballers franchise began as a meme and ongoing inside joke for the 'Sell' movement of A’s fans in early 2024, when it became clear that the Howard Terminal stadium had likely only been negotiated by A's team owner John Fisher, as a stalking horse for a Las Vegas stadium deal. The idea of a fan-owned team captured A’s fan’s imagination as a celebratory catharsis as they resigned themselves to the loss of the historic A’s.
Serious investment turned the B’s into a real Partner league MLB team with plans for Raimondi facilitated by then-Mayor Sheng Thao and D3 representative Carroll Fife. The initial lease for Raimondi was unanimously supported by last year’s Council, and included a parallel license to use an adjacent city-owned parcel for parking. That site is currently in pre-development by Mid-Pen/Habitat for Humanity for an affordable housing project. The first Ballers season was an unconditional success, despite a negative smear campaign of dubious origin clearly tied to promoting the recall of Sheng Thao.
The lease for Raimondi is for a period of ten years at 1K/year with 3% annual increases; it includes profit-sharing for the City of Oakland from naming rights and advertisements. See the term sheet below:
The term for the lease for the parking site will depend on how quickly construction begins there—the lease has a one year base, with two one-year options. The parking lease can be terminated with 30-day notice, except right before and during the season. The Ballers will be required to come up with their own parking plan after MidPen/Habitat construction begins. During the meeting, city staff suggested that parcels may be available for the team to purchase or lease for parking nearby. The leases at Raimondi and the Mid-Pen/Habitat temporary parking site are essentially cost-free for the City, retain substantial free public use, rental of the athletic facilities. Community benefits include free use of the athletic facilities for legacy groups like nearby McClymonds High School.
Fife made a motion to move the agreement to the April 14 meeting.
“What this means in terms of generating revenue for the city, bringing people together after COVID, and creating community, and then showing folks the possibility of what is possible in Oakland, despite all the negativity, is such a beautiful addition to the city of Oakland. I'm honored to be a part of making history with all of you. And I am elated to move this ordinance forward,” Fife said.
As Police Staffing Continues to Shrink, Medical/Administrative Leave and Attrition Reach New Highs
Oakland Police Deputy Chief Lisa Ausmus on Thursday presented Oakland Police Commissioners [OPC] alarming data that shows the highest number of “on leave” officers since the department began presenting the information publicly in March 2024. The report also notes an attrition rate for OPD officers of 5 per month, one of the highest since a sudden wave of resignations, terminations and retirements roiled the department in 2021 and 2022. The news comes as OPD faces a long, dry staffing period with no academies scheduled and an uncommonly low staffing level at 680.
When the CAO cancelled future academies in December, it left the scheduling of a new class for budget deliberations of FY 2025-26 in June. At the meeting, Ausmus told Commissioners that it takes 45 days to certify an academy.
"Right now, my training unit is trying to set up and get an academy curriculum accredited through POST [the state's Peace Officers Standards and Training certification]. So if they [Council/CAO] do push that button, July 1, we're ready to go, right, because it does take 45 days for POST to certify our academies and our instructors. So we're just trying to put everything, all our ducks in a row, and they're working diligently on that. And I'm hoping it's July 1, or the first couple of days in July, but I it's not been determined yet," Ausmus said.
Even if OPD's new academy starts in early July, it is unlikely to receive an infusion of new police officers from the 5 to 6 month classes until early next year, leaving OPD’s staffing to dwindle at a rate of 3 to 5 per month or more until then. The OPD could reach levels below 630 by the time the academy graduates, and that’s if the academy can begin as soon as possible. As it does now, the on leave figure puts the functional staffing level 100 officers weaker than it appears.
*city reps often use shorthand to refer to the City's funding of affordable housing by the term for the grant-award process, Notice of Funding Availability [NOFA]. The acronym has generally become the way the entire process and the funding itself is discussed in council processes.
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