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Bohannon agrees to public benefits, emission reductions for huge office/hotel project

 

Menlo Park and the Bohannon Development Co. have concluded preliminary negotiations over a proposal for a nearly 1 million-square-foot office/hotel project near Marsh Road and Bayfront Expressway, giving residents their first look at what the city might receive in exchange for major zoning concessions.

Among other things, the Bohannon company has agreed to offset the greenhouse gas emissions generated by the project, to reduce vehicle trips by 17 percent, and to provide monetary benefits.

Released late Thursday, the "term sheet" outlines a list of conditions the Bohannon company has agreed to, if the City Council approves the project. They include:

■ A total of $1 million to fund city projects in the nearby Belle Haven neighborhood, in Bedwell Bayfront Park, or in other city recreation facilities;

■ Increasing the tax to guests at the new hotel by 1 percent over the city's current rate, raising an additional $100,000 to $150,000 for city coffers;

■ Hiring priority for Belle Haven residents interested in construction jobs at the site, as well as jobs once the hotel and offices are up and running;

■ A series of terms related to traffic, conservation, and greenhouse gas emissions. The Bohannon company has agreed to completely offset the carbon emissions generated by the operation of the buildings, to reduce vehicle trips to and from the site by 17 percent below the total trips projected by the environmental impact report, and to build the offices to meet LEED Gold certification, and the hotel to meet LEED Silver certification.

The Bohannon company would have to begin building the hotel within eight years of the date of approval, and the first office building within 15 years of the date of approval.

The Bohannon company has already spent over $7 million to develop project plans and apply to the city, and on communication efforts.

A financial analysis commissioned by the city concluded that the project would involve considerable risk to the developer, and might not be financially feasible.

The City Council will review the term sheet at its April 6 meeting. It could elect to proceed with the approval process, or it could ask for more concessions from the Bohannon company.

The council has already decided that the size of the project -- three office buildings up to 140 feet and a 230-room hotel, along with several large parking garages -- would not be a deal-breaker.

The city estimated that the project would generate $1.6 million per year for the city's general fund.

To see the term sheet, click here.

The city has also released a final environmental review of the project, with an expanded consideration of greenhouse gas emissions and other issues, plus renderings of what the buildings might look like from U.S. 101 and the Marsh Road overpass. To view the report, click here.

A more comprehensive story will run in the March 31 issue of The Almanac.

Comments

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Posted by Peter Carpenter
a resident of Atherton: Lindenwood
on Mar 26, 2010 at 12:41 pm

Peter Carpenter is a registered user.

This process is proof positive of the short sightedness and selfishness of the Menlo Park City Council and staff. Regardless of the merits of this project, Menlo Park is doing all of the negotiations based on ONLY its narrow self interests. This project would have a profound impact on a number of other public entities and yet there is not one word in these documents regarding either the Fire District or the impacted school districts.

For example, the project will include three 140 foot office buildings and a 230 room hotel. Where will the resources come from to provide fire protection for this project? Should the Fire District moves its only ladder truck from its Middlefield station to its East Menlo Park station? What other existing Fire District resources will need to be removed from existing locations to serve this project? How will these move impact the level of service for the rest of the Fire District?

In any rational city planning process the fire department would be sitting at the table and the developer would be required to fund the incremental capital investments necessary to serve their increased demands - the ongoing expenses would appropriately be covered by property taxes.

Menlo Park should be ashamed of their unprofessional and selfish approach to the evaluation of this project.


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Posted by Steve
a resident of Menlo Park: Downtown
on Mar 26, 2010 at 1:14 pm

Peter -
Your tone is pretty harsh! I thought you'd be pleased that Menlo Park had concluded anything with the Bohannon developers. In previous posts you indicated you thought the city was trying to delay this development indefinitely.
While I agree with your point that the Fire District may have a dog in this race and should have been at the table (do you know that their interests weren't considered by the city?), I don't see that the school district is affected by this project which proposes only a hotel and office buildings. It shouldn't have an effect on the number of kids in the schools, unless I'm missing something.


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Posted by Peter Carpenter
a resident of Atherton: Lindenwood
on Mar 26, 2010 at 1:18 pm

Peter Carpenter is a registered user.

Steve asks:"While I agree with your point that the Fire District may have a dog in this race and should have been at the table (do you know that their interests weren't considered by the city?)"

Simple,here are the published planning parameters -

"As described above, the City Council provided direction to the negotiating team on November 17, 2009 in the form of caveats. One of the first tasks that the staff negotiating team performed was distilling the caveats into a set of parameters, which were reviewed by the Council Subcommittee. The parameters can be summarized as follows:
Highest Priority Items
Timely guaranteed revenue
Substantial vehicle trip reduction
Substantial reduction in greenhouse gas emissions
Limits on transferability without City approval
Reasonable limits on the time for construction - Hotel in 1st phase
Improvement to the footprint & aesthetics of the parking structures
Priority hiring program for Menlo Park residents
Commitment to pursue LEED gold for office and silver for hotel

Other Priority Items
Improving bike and pedestrian connection to and from the Belle Haven neighborhood and in the Marsh Roar corridor
Land for housing
Page 5 of 17 Staff Report #10-044

Increased revenue beyond FIA projections
Undergrounding of transmission lines
Developing a vision for the Menlo Park waterfront area
Enhancing Bayfront Park
Providing retail services or child care on-site or nearby
Additional public benefits such as bus shelters and youth programs"

Not one mention of fire services !!


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Posted by Peter Carpenter
a resident of Atherton: Lindenwood
on Mar 26, 2010 at 2:01 pm

Peter Carpenter is a registered user.

Here is how the City treated concerns raised by the Fire District inits EIR:
"The Menlo Park Fire Protection District (District) states that the project would have a negative impact
on providing proper emergency services because the project includes buildings over three stories in
height. According to the District, “acceptable standards” require a ladder truck be located within
2.5 miles of the project site. According to the District, the closest aerial ladder truck is 3.1 miles from
the site. Although this truck would have an 8 minute response time, which is in keeping with the
applicable National Fire Protection Association’s 1710 Standard, the District contends that there is a
negative impact due to this distance. The District’s letter and subsequent correspondence do not
provide any citation to the legal authority supporting its position.
The Bay Area Economics (BAE) Fiscal Impact Analysis referenced in the District’s letter states that the
requirement for the proximity of an aerial truck (i.e. 2.5 miles) comes from the Insurance Services
Organization (ISO) 2004 Public Protection Classification Study. ISO is the leading supplier of
statistical, underwriting, and actuarial information for the property/casualty insurance industry. The
ISO’s 2004 Public Protection Classification Study states their report “is not for purposes of determining
compliance with any state or local law, nor is it for making recommendations about loss prevention or
life safety.” As such, there is no legal basis for the District’s assertion that a ladder truck must be
located within 2.5 miles of the project site. The District’s comment letter, therefore, does not provide
the substantial evidence required by CEQA Guidelines section 15384(a) to support its claim as to a
“negative impact.”
The District’s comment letter also does not indicate there is an actual physical impact to the
environment. In fact, the majority of the District’s letter relates only to the cost of a ladder truck. The
District indicates it would need to “convert” an existing engine company into a truck company.
Similarly, the BAE Fiscal Impact Analysis states that the existing engine would need to be “replaced”
with a ladder truck. The cost of this ladder truck is considered in the BAE Fiscal Impact Analysis and
the District’s comment letter in the context of this need for conversion/replacement. However, CEQA
only is concerned with physical impacts to the environment. Thus, the economic impact alleged, which
is not mandated by the development of the project, is not a physical impact and; therefore, no change
to the Draft EIR’s analysis or conclusion is warranted, per CEQA Guidelines section 15382. In
addition, if the District chose to replace the existing engine company with a truck company and that
conversion required any modification to or remodel of the existing fire station, it would be an
insignificant change that does not result in a substantial adverse physical impact on the environment.
Again, as noted on page 3.10-3 of the Draft EIR, the relevant criterion for making a determination
about the project’s impact is whether it would “result in a substantial adverse physical impact
associated with provision of new or physically altered police and/or fire protection and emergency
services facilities ….” As presented, the District’s concerns do not raise issues with the adequacy of
the DEIR or the City’s implementation of CEQA."

So nothing about the Fire District's very legitimate needs in the planning parameters and swift dismissal of their concerns in the EIR.

Truly unprofessional planning and project review.


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Posted by Peter Carpenter
a resident of Atherton: Lindenwood
on Mar 26, 2010 at 2:49 pm

Peter Carpenter is a registered user.

Steve asks:", I don't see that the school district is affected by this project which proposes only a hotel and office buildings. It shouldn't have an effect on the number of kids in the schools, unless I'm missing something."

Reading the EIR you will find that the project will have an induced housing demand of 109 households - all without children?


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Posted by Menlo Voter
a resident of Menlo Park: other
on Mar 26, 2010 at 4:55 pm

I have not yet dug fully into the details yet, but it appears to me this will be a drain on city resources without offsetting income to the city. I doubt the hotel tax and the sales taxes generated by the hotel will pay for the added police, fire and other service this project will necessitate. Personally, I'd like to see something that would generate sufficient income to pay for the city services that will be impacted. Office space doesn't do it.


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Posted by read the economic analysis
a resident of Menlo Park: other
on Mar 26, 2010 at 7:39 pm

There was an independent economic analysis of this project in terms of net impact that I believe showed it would be a net positive for Menlo Park. The data should speak for itself.

Many cities clambor for hotels like this one. The Rosewood hotel at Sand Hill and 280 generates more than all the sales taxes for Downtown Menlo Park. Upgrading a now run down area with a top flight hotel at Marsh and 101 with a high end health club, and some posh office buildings with great views, fills a niche we don't have covered.

If the project brings in $1.6 per year for our City, that's huge given the structural budget deficits facing our State which "flows downhill" to our cities including Menlo Park whose general fund budget is I think about $40M per year with an expected shortfall this year of about $600,000 or so.

Jobs and revenue are important!


Like this comment
Posted by reality bites
a resident of Menlo Park: Downtown
on Mar 26, 2010 at 11:23 pm

read, If the project were just a hotel, the economics would be different, and the approval process not nearly as contentious.

Menlo Voter is correct: the project represents not only a drain on our city but an increase in city traffic without commensurate benefits. However, the one key point to keep in mind is that Bohannon is not committing to build anything. Not a hotel, not a million square feet of space, nothing. All he is asking for right now is for the city to upzone his property, ie print money for him.


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Posted by Menlo Voter
a resident of Menlo Park: other
on Mar 27, 2010 at 9:47 am

Very good point Reality. Bohannon gets his property up-zoned then sells it at a profit to someone that hasn't guaranteed the city anything, but is now holding property on which they can build whatever they want. That's a recipe for a huge impact on city services. Our council needs to be careful with this one.


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Posted by Peter Carpenter
a resident of Atherton: Lindenwood
on Mar 27, 2010 at 10:42 am

One way to avoid giving the property new commercial zoning without commitment to a specific plan would be to rezone the property as a Planned Community or PC zone. With such a PC zone the specific development and development schedule is codified and cannot be changed without the City's approval.

Here is the description of a Planned Community zone from the Palo Alto ordinance:
"The PC planned community district is intended to accommodate developments for residential,commercial, professional, research, administrative, industrial, or other activities, including
combinations of uses appropriately requiring flexibility under controlled conditions not otherwise attainable under other districts. The planned community district is particularly intended for unified,
comprehensively planned developments which are of substantial public benefit, and which conform with and enhance the policies and programs of the Palo Alto Comprehensive Plan."

And here is how what is done within a PC is controlled:
"each application for a PC district shall be
accompanied by a development program statement, a development plan, and a development schedule.
The development plan shall, as approved by the city council, become a part of the zoning regulations applicable within the respective PC district."

Under such an approach the City would have control over what was done and Bohannon could not sell the PC zoned land for any other use or development except as provided in the established PC zone.

It doesn't take a rocket scientist to develop a PC zone for this land.


Like this comment
Posted by Peter Carpenter
a resident of Atherton: Lindenwood
on Mar 27, 2010 at 11:19 am

It turns out that Menlo Park already has a version of a PC zone in its ordinance - a Planned Development or PD zone.
"16.57.010 Establishment of a P-D zone. Applications for the establishment of or reclassification to the P-D zone classifications must include a development plan as described in this chapter. The zone reclassification shall not be approved until a permit approving the development plan has been issued by the planning commission and the city council.
The planning commission and city council, after public hearings, may approve, disapprove, modify or attach conditions to a development plan."

"A development plan shall be accompanied by a development schedule indicating the approximate date when construction of the project can be expected to begin (which date shall be no later than one year from the effective date of the rezoning of the property) the anticipated rate of development, and completion date. The development schedule, if approved by the city council, shall be adhered to by the owner of the property in the P-D zone and his successors in interest."

So now the question is - why isn't Menlo Park using this tool for the Bohannon project?????


Like this comment
Posted by Menlo Voter
a resident of Menlo Park: other
on Mar 28, 2010 at 10:33 am

So now the question is - why isn't Menlo Park using this tool for the Bohannon project?????

Because they're lazy? Because they're clueless? Because they've been bought off?


Like this comment
Posted by Fed Up
a resident of another community
on Mar 28, 2010 at 4:19 pm

Peter,

Why should Menlo Park listen to your home town of Atherton? What makes you think that Atherton deserves any input, when Atherton is a collection of clowns incapable of rational government as shown by the articles on the crazy infighting of the Atherton town council. Atherton doesn't deserve a seat at the table until it earns the respect of the neighboring Menlo Park council. Atherton is a long, long way from that.


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Posted by Peter Carpenter
a resident of Atherton: Lindenwood
on Mar 28, 2010 at 4:45 pm

Fed Up - no reason why Menlo Park should listen to the Town of Atherton.

Lot's of reasons why they should listen to me -
Who else on this thread has done any homework?
Who else has pointed out specific flaws in their current negotiations?
Who else has identified the PD zone as the way to ensure that the zoning change only occurs if there is a development plan and schedule that is binding not only on Bohannon but also on his successors in interest?


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Posted by Menlo Voter
a resident of Menlo Park: other
on Mar 28, 2010 at 8:39 pm

You are a god Peter, truly. @@


Like this comment
Posted by concerned school mom
a resident of Hillview Middle School
on Mar 29, 2010 at 2:52 pm

Peter, you make some excellent points, but I believe you are incorrect that the induced housing is only 109 units.
In the EIR section about population and housing, it says there will be 1,878 net new jobs, or 1,090 new housing units in the region. It assumes that only 10% of those units would be in Menlo Park because that's about how many people who work in Menlo Park also live in Menlo Park (the 109 you mention).
In addition to the 1,878 net new jobs directly resulting from the proposed project, there also would be about 1,221 indirect and induced jobs regionally. This is a total of 3,099 additional jobs!
Using the same ratio, a total of 1799 new housing units would be required "somewhere" in the region.

So why do I bring this up? The impact on our schools -- even if the 10% assumption were valid for the housing required in Menlo Park, the additional housing would be 10% of the total direct and indirect, or 180 units. But remember that the school districts draw from other communities where most of the housing demand for professional offices will be felt. And the houses likely will include school children.
If 20% of the new units were in the MP school districts' area, that would be potentially 360 new families. If 50% were in the area, that would be potentially 900 new families! Who knows how many kids that is!
Not only is the EIR using faulty logic on the impacts for housing, it severely downplays the school impacts. Almost none of the school district funds normally flowing from property taxes on the project properties would go the the MP school districts. Almost all would go to Redwood City.


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Posted by Peter Carpenter
a resident of Atherton: Lindenwood
on Mar 29, 2010 at 4:33 pm

School Mom is absolutely correct. I was told that Menlo Park essentially told the Fire Districts and the School Districts that there was just so much mitigation money that they could get out of Bohannon and that Menlo Park was going to take it all for the City.

I predict that the Fire District and the School Districts will need to go to court to block this project until they get their fair share of the mitigation payments.


Like this comment
Posted by James
a resident of Menlo Park: Menlo Oaks
on Mar 29, 2010 at 10:50 pm

Is it just me or have many of our elected officials failed to do their job? From the “antics” of the school board to falderal of Atherton’s and Menlo Park’s City Councils and don’t even get me started on the folks at the state and national levels. I feel so confident that we have capable people doing the right thing and making good decisions.

November’s election can’t get here fast enough!


Like this comment
Posted by concerned school mom
a resident of Hillview Middle School
on Mar 30, 2010 at 8:18 am

It appears that it is Bohannon who doesn't care about the local Fire District or school districts. The money that flows to Redwood City is the way things happen because of the convoluted boundaries of school districts and how that portion of limited property taxes flow.

The negotiations were conducted by city staff with no council members or regular citizens present. The term sheet looks like the city's negotiators were very weak. The full city council can insist on fewer negative impacts and greater (and sooner) benefits, and send the proposal back into negotiations or just say "no" to a project that does not bring adequate benefits to the city. What has been requested goes way beyond the current rules, and the council does not have to bend them just because someone asked.

It appears to me that there should be no rush to approve this project. Nothing at all will happen for several years, possibly not even 5-7 years. And major parts might not even happen for 15 years! Bohannon just wants to to enhance the value of the land and lock in the rights to develop as he or a new buyer pleases before the city updates the general plan and zoning codes for that part of town. With all the land his company owns in Menlo Park, it would be "cheap" to provide land for schools or housing to minimize impacts as part of the deal.


Like this comment
Posted by Recog
a resident of Menlo Park: Menlo Oaks
on Mar 30, 2010 at 10:15 am

This agreement is about greed.


Like this comment
Posted by old timer
a resident of Menlo Park: Central Menlo Park
on Apr 3, 2010 at 7:16 am

"James" above writes ...

Is it just me or have many of our elected officials failed to do their job?

Yes, it is that many of our elected officials are failing to do their jobs.

Just having read the "term" sheet and other materials for the Bohannon project I can only shake my head in wonderment at just how bad MP leadership has become.

Remember this negotiation was led by City Manager Rojas, City attorney McClure and Deputy City manager Steffens. All three have a vested interest in seeing this project approved, since their salaries depend on income the City receives, and the current mantra from this leadership is "we must build our way out of the current budget deficits."

Our elected officials, our City Council members, have appointed these leaders and endorsed them as the team to do the negotiations. The Council made a terrible decision in choosing them, as is now fully evidenced by the give away to the Bohannon of what may well be hundreds of millions of dollars by their not securing a fair public benefit package for approving this huge project with its major impacts to the City in terms of housing needs, school impacts and terrible increase in traffic congestion.

And contrary to opinions voiced by our so called "green leaders", like Mitch Slomiak, who endorses the project, yet fails to acknowledge this project will still in spite of improvements, have a major impact of green house gas emissions.

Kelly Fergusson is a key council member to watch on Tuesday. She has constantly said, "for up zoning the City must be rewarded with sizable public benefits." This package certainly give very little. Let us see how she reacts.


Like this comment
Posted by reality bites
a resident of Menlo Park: Downtown
on Apr 3, 2010 at 4:11 pm

Kelly is going to vote for it, as are all the other council members. Reasons:

* They're intimidated by Bo's wealth and ambition; voting against this project could unleash his wrath.

* Doing something always feels better than doing nothing (this is especially true for the four that are sometimes wrongly accused of being no-growthers).

* Nothing is going to happen on this land for many years. Nothing. When and if anything is built, the current council members will be long gone and won't be the obvious target for fingerpointing.

The term sheet is a sad piece of work. Not only are the benefits for MP minimal, they decline as the years pass. Best case: this development proceeds slowly and only exacerbates the existing traffic snarls by a factor of two. Worse case: MP loses its economic engine forever, and the city spirals downward into an inexorable decline. By then, Bo will have gotten his money out of the venture and MP will be a different kind of city. Not one we'd want to live in.

For this, and for the management fiasco, none of our current council members deserve their jobs. Apparently the three incumbents whose terms expire believe that voters aren't paying attention. Guess we'll find out.


Sorry, but further commenting on this topic has been closed.

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