Oakland Politics Week in Review 5/15/2023

Oakland Politics Week in Review 5/15/2023: CMs Rush Billboard Contracts for Significant Campaign Donor Companies; Oakland Youth Descend on Council Meeting in Now Lifelong Fight Against Coal; Kaplan Pursues City Auditor Investigation on ESO Ventures; Last Minute Changes to Sideshow Ordinance Weren't Agendized; New City Admin Johnson Gets "Cop City" Questions During Confirmation; Stacked Public Works Committee Meeting Risks Lack of Transparency

City Administrator's Office Adds Last-Minute Amendments to Sideshow Ordinance

Several clauses were added to the sideshow ordinance on the dais Tuesday as it was presented for a vote on the consent calendar. The amendments had not been included in the legislative folder for the item. Assistant City Administrator Joe DeVries, who introduced the changes at the podium, initially did not provide written documentation of them. After being prodded by City Councilmembers, Devries made a copy available to Council and the public.

The changes added:

In Definitions, Subsection F, a new clause:

“7. (1) or more drivers is demonstrating or performing automotive stunts including but not limited to spinning doughnuts, vehicles swerving back and forth, burning rubber, spinning cars, racing or obstructing any public street, highway or in an Offstreet Parking Facility.”

In Penalties and Violation, Section A. 1:

Addition of phrase “that may be charged by the District Attorney” to the text.

In Penalties and Violation, adding two paragraph clauses:

“The City may assess the following penalties for violations of this chapter: (a) one thousand dollars ($1,000.00) for the first violation; (b) two thousand five hundred [sic] ($2,500.00) for the second violation; and (c) five thousand dollars ($5,000.00) for the third violation and for

each subsequent violation committed within a calendar year.”

And:

“The City may recover damages caused by any violation of this section.”

Council President Nikki Fortunato Bas did not request a vote to determine if the amendments should be allowed on the dais, as Council rules might potentially dictate depending on how substantive the changes are. DeVries described the amendments as “minor,” and Council members appear to have agreed without deliberation. The legislation passed unanimously, although it differed from what the public would have understood was to be voted on, and the amendments were offered without sufficient time for attendees to analyze them before the vote.

Requests for comment and explanation to the City Administrator’s Office and Council President Bas were not returned by press time.

Oakland Youth Descend on Council Meeting, Concerned Future City Settlement with Coal Shippers Could Bring Coal to Oakland by Default

photo from YVA

Dozens of young Oakland residents opposing a potential coal transit through Oakland flooded the Council chambers Tuesday, after they were inadvertently denied entry due to a staff miscommunication to security. The delegation from the organization Youth vs. the Apocalypse had initially gathered at City Hall to speak on an item for report-outs from closed session, sandwiched in between the consent and non-consent agendas. But a misinterpreted communication from a City staffer prompted security guards to believe they had been instructed to keep the group of high school-age youth out of the chambers, according to participant and YVA Programs Director/Co-Founder Carolyn Norr.

Staff had apparently only signaled to close the doors so noise from the lobby would not interfere with the meeting, but did not tell security to keep the youth delegation out of the chambers, Norr said, miscommunications that were eventually cleared up. Norr also noted, however, that a move to lock the mostly BIPOC youth out wouldn’t have been that unusual.

“This happens a lot. There’s other hearings we’ve gone to with CALSTRS [California State Teachers' Retirement System] that does lock the students out and refuses to allow them to testify even with parent permission. So there was kind of a sense that this might be that they are just not letting them in.”

By the time the chain of events was unraveled over twenty minutes later, the public speaking period on the item had passed, and the Council was well into the non-consent portion of the agenda. Council President Bas allowed the youth to speak to the item, however, and admonished City staff for the issues.

Once allowed to speak, high school-age youth–some of whom noted they’ve been protesting potential coal in Oakland since they were in sixth grade–shared their concerns about the City’s settlement negotiations on a potential coal operation.

The CIty has been in settlement negotiations for years in a complicated chain of lawsuits arising from the City’s attempts to prevent coal from being shipped through Oakland Bulk and Oversized Terminal, a company led by local public  investor Phil Tagami who holds a disputed lease for property on the Oakland Army Base. Tagami’s interests entered into a partnership sublease with Utah-based coal shipper Insight Terminal Solutions that would have seen the site turned into a destination for massive amounts of coal in transit to Asian markets. The original owner went bankrupt while the deal itself faced Council opposition and Insight’s assets were purchased by interests overseen by JMB Capital–the money and power behind Autumn Wind Lending, the shell company that now owns Insight and is waging the legal battle against the City.

JMB Capital and its principals made headlines during last year’s Oakland election season, when the consortium helped raise nearly a million dollars for a campaign finance committee run by local coal lobbyist Greg McConnell on behalf of Mayoral candidate, Ignacio de la Fuente. Nearly half of the funds were contributed by JMB.

After a brief period when it appeared a settlement would be agreed on in 2022, the coal interests announced they were breaking with the settlement track and would go to trial. Since then, the City and the coal interests have returned to largely undisclosed negotiations.

Recently, the interests behind Insight issued an “open letter” to Oakland residents, claiming that the companies will pledge not to ship coal to Oakland and the City faces fiscal insolvency by turning down Insight’s favored settlement. Opponents of the coal plan argue that the arguments are deceptive and manipulative and that the City should pursue better terms. No Coal in Oakland, a coalition of groups and individuals opposing the coal project, says that the companies could pursue litigation again after the settlement, counting on federal laws that supercede Oakland's ability to ban coal.

A settlement could come at any time before the July hearing. YVA activists, many of whom began protesting coal in Oakland when the organization was Youth Versus Coal Campaign nearly 10 years ago, worried that Councilmembers could be leaning toward the unfavorable settlement, leaving the gate open for coal in Oakland.

“We as a city need to stand strong and say it’s not okay to sacrifice the health of the people of West Oakland who are already dealing with a lot of pollution and stress … to make a profit for a coal company or developer,” said Norr.

Norr and others point to a recent study on rail shipments of coal to Richmond, showing that coal shipping contributed significant toxic particulate matter [PM 2.5] to local air pollution in the area. Gracie Osborne, a YVA Community Education Organizer, told Oakland Observer there’s great anxiety among young Oakland residents over the prospect of adding yet another pollutant to Oakland’s air.

“We know that one thing that coal creates is coal dust, and PM 2.5, and that toxic particles in the air can bring a lot of impacts on our health. We know that coal dust can aggravate asthma, lung cancer and we know that primarily people of color are the ones who face those diseases the most and we know that a lot of people in Oakland are low income and also don’t have the best health insurance. All those issues are intersectional and they pile up together,” Osborne said.

Speakers at the meeting linked the particle to the same pollutant in wildfire smoke that the City dealt with for weeks during a wildfire crisis in 2020. De’Arieus, a Youth Education Advisor with YvA asked Councilmembers to remember when “the sky was orange” during wildfires.

“Forest fires have had us in a state of panic for years, and now we’re shipping coal through the Town?”

The settlement negotiations are not public, so residents may not know about an outcome until it is ready for a vote by Council, or when a decision is made in the courts if it comes to a trial.

YVA is working in conjunction with a coalition of groups that includes:

350 Bay Area, APEN, East Bay Physicians for Social Responsibility, Faith in Action, Interfaith Council of Alameda County, No Coal in Oakland, San Francisco Baykeeper, Sierra Club San Francisco Bay, West Oakland Environmental Indicators Project, and West Oakland Neighbors

Nearly 100 D6 Residents Express Concerns and Hopes at D6 Budget Town Hall

Nearly 100 East Oakland residents participated in a budget town hall event for District 6 at St. Benedict Church. Budget town halls are a legislated part of the budgetary process–each district must hold a town hall to solicit resident opinions and questions. The event was also broadcast on Zoom, but Zoom participants were unable to interact directly.

After an overview by Budget Director Bradley Johnson, residents spoke about their hopes and concerns and asked questions of Johnson and D6 Council Representative Kevin Jenkins. While public safety and dumping were frequently raised as the focus of comments, other matters also loomed large.

Speakers raised a variety of issues: potential reduction in arts funding; homelessness and housing, as well as a decision by Mayor Thao to consolidate departments and increase spending on OPD. A sample of excerpted comments follow:

Vanessa of ACCE

“On Foothill Blvd. from 55th going towards Eastmont Mall … there are no businesses and there’s no life in those areas, it looks bleak, it is bleak, there’s no businesses and that’s something I’d like changed.”

An unidentified speaker who worried how the City “got here”

“I love our city, born and raised here … what’s going to become of us? What is it going to look like with having to make these difficult cuts … how did we get here? Who was minding the store?

A filmmaker on her work focusing on homelessness

“… we’ve done a deep dive in homelessness … homelessness is way more than what we think it is, when we think about people living on the street, that’s like a fifth of people facing homelessness. … We deserve more than clean streets, we deserve clean streets, but we deserve more than that.”

Larry Burton, pastor of All Nations Pentecostal Church on 82nd and International Blvd.,

Burton complained about the dangers of crossing International street for his congregants when exiting the Bus Rapid Transit stops..:

“My main concern is my members, when they get off the bus on 82nd Ave., they got to cross a busy street [from the BRT island]. And people regarding that bus line as a place to drive through, everybody drives through … it’s a hazard. What are you going to do about that?”

Jenkins told this publication that he appreciated the forum, and wished it was happening under a better budget prognosis.  “We have a significant budget deficit, so I’m loving the process where the constituents are coming out and voicing their concerns. We’re going to have to make some tough choices, but my intention is to ensure that East Oakland is represented.”

Jenkins said that some of the toughest choices he would have to make would be on the community grants budget, which has been reduced from over $7MM to just $750K.

“Last budget cycle, it was budgeted at $7.5MM, and now it’s budgeted at $750,000 there are a lot of community-based organizations that are hurting and in need of that money, so I think that’s one of the toughest.”

Council Unanimously Appoints New City Administrator, Jestin Johnson

Councilmembers voted unanimously to appoint Jestin Johnson to the City Administrator role after a brief presentation by Mayor Sheng Thao. During the deliberation, Johnson received at least one question about his relationship with Cop City by Carroll Fife who said she’d spoken to Johnson off the record about Cop City but wanted him to make his comments public.

“In full transparency, I want the rest of the public and all of the viewers and residents in Oakland to also understand something that’s of critical important to individuals who support me and my base…so if you could speak to your role in Cop City and clarify what role you actually played and your participation in that endeavor in Atlanta.”

Johnson responded:

“My role as the Deputy COO over public safety as well as over facilities, the responsibility that was provided to us was to identify a location for our police and fire department to relocate. They had been operating in facilities that were well past their useful life, so there was negotiation with respect to relocating them. But during that time when the decision was made to come up with and identify different locations for us, a recommendation was made specifically to enter into a ground lease with the Atlanta Police Foundation who was then taking the lead on the development of the site.

And so during that process, that was early Winter, late Summer when that happened, and that vote was taken by the COunicl and once that happened my term as Deputy COO ended at the end of December 2021, and so some of what we hear today is certainly long after my tenure ended.”

Fife said that she appreciated the clarifications on the record, and then seconded the motion made by CM Jenkins to pass the resolution hiring Johnson. In his comments, Johnson said that he’d had a ride along with Johnson in D6 earlier in the day.

“I was really impressed with his deep knowledge and the research that he’s done on Oakland and laws that affect Oakland…I believe that he will bring much needed solutions, he’s well aware of the deep rooted issues that we have that are plaguing our city, and it seems like he’s ready to solve these issues with us”

Johnson will assume the role beginning June 5 and his contract will end in January, 2027 at a salary of $350k per year.

Council Week 5/22/2023

Kaplan Brings Request for City Auditor Investigation of ESO Ventures’ Use of Public Funds at Monday Special Finance Committee Meeting

At a special Finance Committee meeting set for Monday at 10 am instead of the usual Tuesday, CM Rebecca Kaplan will bring a request to the City Auditor to investigate expenditures of public funds by ESO Ventures, a business incubator and finance company co-founded by former CM Loren Taylor. Taylor was instrumental in steering a discretionary state grant of $8MM to ESO, a process that began even before the for-profit company had incorporated. The grant’s focus is to incubate and finance entrepreneurs in East Oakland’s Black and Brown communities.

Taylor agendized the allocation of the grant in September 2021, but during the Council meeting, it became apparent that ESO Ventures had only been incorporated for five months and had three staff members who are also its partners and founders. At that time, the language of the legislation stated that the City was the “pass-through entity,” i.e., that the City would receive and then disburse the funds to ESO: the City Attorney in the course of the meeting confirmed the belief that the City was the pass-through and thus could add stipulations to the grant. The legislation included in the packet even specified the City fund the money was expected to be deposited in, 2159, the City of Oakland fund for the receipt of California grants.

Councilmembers thus added amendments to the legislation that bifurcated the $8 MM into two separate $4 MM tranches, the second only becoming available in late 2022, after a report to Council by ESO about how it had spent the funds. However, ESO never returned with the report, Council public records reveal.

Kaplan’s legislation asks the Auditor to investigate how the firm used public funds. Apart from the state grant, ESO was also awarded a $75K grant from the City of Oakland for non-profit community groups several months earlier in 2021, even though the organization is a for profit company.

Inquiries and a public records request by this publication made in 2022 reveal that at some point, the City Administrator’s office became aware that the City was not a pass-through entity for the funds, and thus had no discretionary authority over the grant. Rather, the Economic and Workforce Development Department (EWD) merely facilitated the contractual process with the Governor’s Office of Business and Economic Development, which gave the entire grant to ESO in December 2021, with no stipulations or requirements.

The City Administrator never returned to Council with a report on the full award, and Councilmembers never legislatively followed up on the requirement for an agendized report, even after the return report deadline passed.

A City spokesperson declined to explain to this publication why the City Administrator didn’t return to rescind the legislation when the question was asked in 2022.

State incorporation documents reviewed by OO show that CEO [and co-founder] Alfredo Matthew has had a Plano, Texas address for the entirety of the company’s existence. In December, the shareholders voted to increase the number of allowed shareholders from 2,000,000 to 10,000,000–but the documents are not required to show how many shareholders or their identities and that information is currently unknown. In its most recent documents, the company's principal address was listed as a condominium that is also listed as the address for one of its co-founders, Benjamin Wanzo, even after receiving millions more in state funds since the initial $8MM. ESO is a for-profit company that has no public reporting requirements except to its shareholders. It’s not clear whether the Auditor will have the authority to investigate anything beyond the $75K in City funds awarded to ESO shortly before it received the $8MM in state funds.

7 Contracts for Over $52MM and the Recommended Capital Improvement Projects Budget Will be Heard at Burdened Special Public Works Meeting Tuesday

A lengthy Public Works and Transportation Committee meeting agenda will consider seven contracts for various services, as well as a report on the biennial Capital Improvements Projects budget, which accompanies the City biennial budget and an update on the Safe Oakland Streets Initiative. It’s a surprising and unwieldy agenda that may give short shrift to everything reviewed if items aren’t continued.

Kaplan, Jenkins, Gallo Propose Contract that Favors Billboard Companies That Have Given $43K to Oakland Campaigns Since 2019

Legislation sponsored by Councilmembers Rebecca Kaplan, Noel Gallo and Kevin Jenkins would promote a complicated contract with two major outdoor signage corporations, Foster Interstate and Becker Boards. If approved, the contract would see the companies removing 50 of their combined street billboards and building 10 new larger digital billboards close to Oakland area freeways. The legislation will be heard at the Community and Economic Development [CED] Committee meeting on Tuesday.

The CM-backed deal would bring in about $1.5MM of revenue per year over a 41-year contract, with over $1MM of that going to seven nonprofit organizations as part of a community-benefits agreement–the City would be projected to receive a around $500K per year in revenue from the arrangement. The CMs' report, however, states that the initial fees and payments in the first year, FY 23-24, would bring in $2MM for the City and $1MM for the associated non-profits.

Under City of Oakland and state law, a new billboard can only be developed if an existing one is removed, essentially relocating the billboard. In 2020, CM Gallo proposed and Council passed legislation directing the Planning Commission to propose amendments to the advertising sign laws. That process has been ongoing at the Planning Commission, and a final draft of the proposed legislation is apparently complete and ready for introduction at a future CED committee meeting.

Foster initially approached the City with a more modest plan for “relocation” last July, and subsequently Becker also approached the City with a plan involving a “coalition” of nonprofit groups that would benefit from a community-benefits agreement with Becker. Becker and Foster then came to the City with a new plan combining the proposals, along with the community-benefits package in April of this year–the proposal the three CMs are now bringing forward.

But the legislation for a deal with Foster and Becker will beat the new proposed Planning Commission amendments to the committee, despite the amendments having implications for the future of billboard advertising in Oakland. The proposed amendments would halve the allowed placement zone adjacent to a freeway and ban placement of billboards in areas zoned residential, for example.

Given reduced funding for community groups in the current biennial budget, one rationale for the rush by CMs could also be that the Foster/Becker deal directly benefits those same organizations experiencing decreased funding from the City.

In its report and recommendation to the CED, the Economic and Workforce Development Department [EWD] seems to have reservations about the timing of the proposal, ahead of the Planning amendments, regardless. The EWD report also asserts that Clear Channel recently brought its own relocation plan to the agency, which EWD grades as superior in almost every way, including its higher annual revenue of $2.3MM to the City, which could also be contributed to community groups in any way the City sees fit. The EWD report also claims that the Clear Channel plan would remove more square footage of billboards, and replace it with fewer digital billboards–although some of the billboards would be replaced in their current location with new digital versions. Another proposal by Champion Billboards isn't considered in the same caliber as the Foster/Becker and Clear Channel proposals.

The issue is complicated by the fact that principals of Becker Boards have made significant donations to campaign funds benefitting Sheng Thao and Treva Reid since 2021: collectively, several Becker principals gave $4.5K to each for their runs for mayor.

Foster has also given significant funds since 2019 to local political action funds and candidates, about $32K. The CED Chair, Dan Kalb received a $900 donation in 2020. Foster gave Working Families for a Better Oakland $10K in support of Thao’s mayoral campaign. Foster also gave $5K to committee supporting Treva Reid's Mayoral run, among others. Foster also gave $10K to Californians for Safer Streets, which supported Mayoral candidate Ignacio de la Fuente.

Meanwhile, Clear Channel has donated negligible amounts and nothing directly to any sitting City official.

The legislation was nearly scheduled previously in 2022 twice; once in May, and once in November Rules Committee meeting but both were pulled.

Also:

HHAP Homeless grants and reupped homeless shelter leases at Life Enrichment/Public Safety Committee Meeting Cancelled