Monthly Archives: October 2014

ACTransitThe process by which the East Bay funds transportation infrastructure and transit services is similar to industrial sausage making. All kinds of ingredients are ground into the initiatives that voters must either approve or deny in their entirety. Almost every voter will, if they read the long list of transportation projects in the expenditure plan attached to these massive regional sales tax initiatives, find something they don’t want to see built. But for a transportation package to be approved, 66.67 percent of voters have to feel like they’re getting more of what they want compared to what they don’t. Alternatively, it helps if voters simply don’t read the complete list of ingredients. When you notice that 10 percent of your hot dog is made of rat tails, you tend to throw it all out, even if the other 90 percent is organic apples and grass-fed beef.

It’s a dysfunctional process because it often results in voters striking down much needed transportation funding over relatively small objections in the big list of projects.

Next month Alameda County voters are being asked to approve one of the state’s biggest transportation initiatives in history. It’s called Measure BB, and it’s very similar to Measure B1 from 2012 that fell short of its needed two-thirds vote by a razor thin 0.14 percent.

If passed, Measure BB will raise Alameda County’s sales tax by half a cent, creating a total 1 cent sales tax dedicated to funding transportation capital projects and services, just like Measure B1 would have done in 2012.

But unlike Measure B1 from 2012, Measure BB sunsets the half cent tax increase after 30 years, instead of continuing the tax forever. Measure BB also eliminates a poorly-planned and expensive rail project that would have run across the Dunbarton Bridge in the South Bay, replacing it with bus services that will likely serve more riders at lower cost.

Measure BB is good, and you should vote for it. Most of what Measure BB will fund is desperately needed. It’s better for the climate, and more equitable because it expands transit services that lower income communities, youths, and seniors, rely one.

Unfortunately there’s still rat meat in the sausage, and you can’t pick it out as you eat. If you want the money for bikes, buses, youths and seniors, you’ve gotta swallow the rodent flesh too.

Measure BB will set aside 10 percent, or $749 million in total revenue to fund BART. Some of this money will go toward improving the existing BART system, which is without a doubt another good reason to vote for Measure BB. However most of the BART money will be spent expanding the BART system out into Livermore and down through Fremont toward San Jose.

TransForm, an Oakland-based transportation advocacy organization that has endorsed Measure BB, objects to using these dollars for BART expansion.

“BART has multi-billion dollar shortfalls to maintain their existing system,” the group explained in its analysis of Measure BB released in June. “These shortfalls are already causing maintenance and capacity problems. If BART does not refocus its attention on maintaining the existing system, the problems will get worse, endanger rider and worker safety, slow down the trains, make it even more cramped, and reduce the number of people BART can carry at rush hour.”

This all might lead to another BART strike, to say nothing of the crowding on trains, broken escalators, long delays, and numerous other problems.

Gerald Cauthen, a transportation engineer and perennial critic of big transit initiatives, opposes Measure BB for numerous reasons, but BART’s cut of the tax dollars is a big red flag for him.

“The total cost of the BART extension to Livermore is 3.2 billion, of which $400 million is a down payment,” said Cauthen. “It’s a total waste of money to run a bart line out to a low density area.”

Cauthen calls other recently built BART projects like the Oakland Airport Connector “boondoggles,” and said the agency should learn from past mistakes rather than continuing to waste resources.

“The legacy here is one of wasting money on these transportation projects caused by politicians who simply don’t stop, gather professionals, study the options, and pick the best ones,” complained Cauthen.


Economist Arthur Pigou.

But there’s one other problem with Measure BB besides what gets funded. Measure BB is a regressive tax to finance transportation. To paraphrase a famous economist, it’s best to tax bad things and use that money to pay for good things that broadly benefit society. Bad things are those that pollute, like burning gasoline and taking up road space in a private automobile that causes wear and tear on streets and endangers pedestrians and bicyclists.

And if ever there was a good thing in Alameda County, especially in revenue-starved cities like Oakland, it’s consumer spending at local retail stores. Retail sales are a sign of job creation, and the circulation of money in the local economy. The regressive impact of taxing retail spending is well known. Sales taxes force low-income households to pay a higher share of their total income than affluent households.

So why use sales taxes to subsidize transportation and transit? And can’t we find a more equitable and robust source of funding?

“That’s the fundamental question that every transpiration agency is grappling with right now,” said Tess Lengyel, Deputy Director of Planning and Policy at the Alameda County Transportation Commission. “What used to be a silver bullet, the gas tax, it no longer works.”

“These kinds of measures result in part from devolution and de-funding from the federal and state levels,” explained San Francisco geography and environment professor Jason Henderson in an e-mail. “They are often called ‘self help’.”

Self help has become increasingly necessary as federal and state gas tax revenues dwindle.

Lengyel said, however, that Measure BB shouldn’t be characterized as a regressive a tax.

“You have to look at what this pays for and who benefits,” said Lengyel. “A lot of people called these sales tax measures regressive before because the expenditures had a lot to do with highways, and the people paying the tax were paying for something they mostly weren’t using.”

Now, said Lengyel, a fair share of the revenues that will be raised by Measure BB will fund transportation projects that benefit lower income workers, urban residents, bicyclists, pedestrians, bus riders, and others who will pay a big share the tax.

Even so, the land values created by transportation infrastructure and transit services are a windfall to property owners who pay low taxes since 1978’s Proposition 13. Meanwhile sales tax measures have come to subsidize a growing percentage of all transportation expenditures in the state. At the same time politicians have found it popular to cut gas taxes and vehicle registration fees, cratering transportation funding while doing nothing to address climate change. And they haven’t replaced these taxes fully with new revenue sources, leaving infrastructure in disrepair.

As for more equitable revenue streams to pay for the transportation projects we need?

“The state has been looking at vehicle registration fee, and a vehicle miles traveled tax,” said Lengyel. She added that cap and trade funds may be used to fund transit and transportation projects also. But to build a bridge from here to there, it looks like we’re stuck with the self-help retail sales tax.

There are many ways to think about a city. One is that the city is a place. Cities are built environments with clear geographical boundaries. Each city is embedded in a region and connected to other cities-as-places. And people, goods, and capital flow between cities, accumulating in some and draining from others. This conception of the city is cadastral. It’s mapped out and made legible as a market through the measurement of physical boundaries and values like home prices, tax rates, and school rankings. As these values rise and fall, so to do the fortunes of the city.

A different way to conceive of a city is that it is a people. Instead of seeing buildings and streets and spaces all linked together in a specific legal and economic schema, this perspective instead finds the city in the people who reside there. The city is a sum of their social relationships, their cultures, institutions. This city is set, for certain, in a particular place, but it’s made a city by the ties of kinship, friendship, and communal obligations that enliven the geography. The community makes the city, and so if the community prospers, so does the city. If the people suffer, so does the city.

In Oakland, California these two conceptions of the city are opposed to one another. And for well over a decade the city-as-a-place has been erasing the city-as-a-people.

It began sometime in the 1990s. After decades of disinvestment, de-industrialization, and the flight of affluent households to exurbia—a process that made Oakland what geographer Richard Walker called a “dark star in an expanding universe,”—the tide of capital suddenly, and at first imperceptibly reversed. Real estate investors began pouring money back into Oakland, often benefiting from city and redevelopment agency subsidies, tax breaks, land swaps, and municipal bonds. Young and affluent white collar workers started moving into apartments and houses around the eastern edge of Lake Merritt, into the downtown, and Jack London Square, and North Oakland. By 1999, when Jerry Brown took over as mayor, the rise of Oakland-as-a-place had already started. But Brown’s 10K Plan accelerated the process.

Inherently a city-as-a-place initiative, the 10K Plan envisioned Oakland, or to be more precise a small slice of downtown Oakland, as a blank slate upon which to inscribe enough new units of housing, mostly condos and apartments, as well as retail stores, theaters, restaurants and all the other trappings of the ideal contemporary urban vitalism, to attract 10,000 new residents. The point was that Oakland’s government would partner with real estate capitalists to build up the city-as-a-place. In turn, this place would conjure a new assemblage of people, drawing in especially the coveted young, monied, hip, consumers seeking an urban alternative to San Francisco.

In an excerpt from Stephen Talbot’s 2001 documentary The Celebrity and the City, Jerry Brown explained the origins of his plan to re-populate downtown Oakland by remaking its places and spaces: “People would say, ‘well why can’t we shop in downtown Oakland? Why do we have I have to go to Walnut Creek? Why do I have to go to San Francisco?’ So that germinated the idea, let’s restore downtown Oakland,” said Brown.

To do so Brown and the real estate entrepreneurs gathered around him understood that they couldn’t just open up retail stores downtown. They had to bring a new and different category of people to Oakland. They weren’t going to build up Oakland for people already living in its borders. That would require tackling big social and economic problems like poverty, unemployment, housing and food insecurity, and institutional racism in the schools and criminal justice system.

Perhaps they had given up on such battles long ago. Brown certainly began abandoning progressive political economy in the late 1970s. He came to accept the straightjacket of neoliberal urbanism that the tax rebellions and withdrawal of federal aid to cities imposed. Since then it has been much easier to provide grants and credits and subsidies for the benefit of private real estate developers than it has been to institute policies that boost the incomes and opportunities for low-income city dwellers.

“We do want capital flowing into Oakland,” Brown said in 2001. He complained, however, that the 10K plan was being stalled by a “negative cheering section” that, “says that anything that happens, that’s going to disrupt something.”

“We’re going to be displaced,” Brown said, repeating the concerns he was hearing from Oaklanders. “They got a name for it: gentrification,” said Brown dismissively.

In the same documentary Brown’s mayoral campaign treasurer and friend, real estate developer John Protopappas is filmed standing outside a live-work loft project in West Oakland teasing a black man on a bicycle who is pulling a shopping cart filled with bottles and cans. “Come on, you gotta move in,” shouts Protopappas. “I don’t think he’ll be moving in,” he then says to the cameraman.

Oakland circa 1999 absolutely lacked “shoppers” downtown. Its built environment was dominated by office buildings filled with the employees of big corporations and law firms during the work week, but come 5pm and weekends the downtown would die as these employees escaped in their cars and via BART back over the hill to the East Bay suburbs. Downtown Oakland was decidedly not hip.

The people actually living downtown, the Oaklanders who weren’t following Brown’s desire of shopping, who weren’t economically capable of buying one of Protopappas’s condos, were predominantly Black, Latino and Asian, with many of the latter two groups made up of first generation immigrants. The low-incomes and high poverty rates afflicting this community meant that without any kind of intervention to empower them economically, they would not be the ones shopping at the new GAP clothing store Brown and his wife (a lawyer for the GAP) were so excited to open on Broadway. Oakland’s existing residents, at least those living in the flatlands, wouldn’t be leasing new apartments opening in Jack London Square, Temescal, and the Uptown.

Instead many of them were displaced through the process of “Jerryfication,” as critics called it. Many more stayed, and have since endured an influx of new residents who have bid up the prices of real estate, making survival in Oakland difficult in new ways. Whereas once life was made difficult by Oakland’s existence outside of key circuits of capital and employment, now it is Oakland’s incorporation into these circuits that is driving up prices and dispossessing long-time residents of their homes and communities.

Screen Shot 2014-10-09 at 10.58.30 AMBetween 2000 and 2013 Oakland lost 27 percent of its Black population, dropping to a low of 103,000. In that same time the city’s white population grew by the same percent, rising from 125,000 to 160,000. In the Census Tract that encompasses the Uptown District the Black population grew by 9 percent between 2000 and 2012. But the white population expanded by 74 percent, from 400 to 700 residents.

The success of Brown’s 10K Plan is evident in the numbers of affluent individuals who have moved into downtown Oakland and spilled over in North Oakland and around Lake Merritt. It’s also evident in the restaurant boom which has become a favorite story for culinary magazines to cover over and over again. And since Brown showed that Oakland could ditch its no-there-there and become a somewhere destination, each successive mayor and city council has sought to further advance the vision of Oakland-as-a-place.

Over the last decade, influenced by Oakland’s real estate entrepreneurs, the city government borrowed from the capital market to fund “quality of life” improvements, including a multi-million dollar makeover of Lake Merritt, the estuary and park around which home and rental prices have exploded upward in recent years. New bike lanes along MacArthur Boulevard and 40th Street connect gentrifying neighborhoods to 3rd wave coffee shops, $10 a bowl mac and cheese diners, and BART stations that shuttle a big percentage of newcomers to their downtown San Francisco office jobs.

The process has now hit full stride. Notwithstanding a recession, whole sections of Oakland are soon to be scraped clear of existing buildings and streets and rebuilt into simulacra of San Francisco’s SOMA or the nearby boomlet of Emeryville. The most ambitious is the West Oakland Specific Plan, or WOSP. Pronounced “wasp,” the plan calls for adding thousands of new homes, 85 percent of them market-rate condos and apartments, that will sponge up spillover from San Francisco’s extremely expensive housing market.

There’s also the Oak to 9th project, now being called Brooklyn Basin, a ground-up master development with 3,100 housing units that will be set on two spits of land protruding into the Oakland estuary. Years ago Oakland mayor Jean Quan was a leader in the radical student movement, an organizer of the Third World Liberation Front, and a self-avowed Maoist revolutionary. Now Quan spends her time recruiting other former Maoists—Chinese billionaire capitalists—to invest in Oakland real estate.

Screen Shot 2014-10-09 at 10.05.15 AM

Screenshot from the web site of Zarsion-OHP 1, LLC, developer of the Brooklyn Basin project, depicting the diversity of residents the new master-planned community will attract.

Zarsion Beijing Holdings, a Chinese conglomerate will finance later stages of the billion dollar plus Brooklyn Basin, which includes a marina and several shoreline parks. It’s already being marketed as a “vibrant new district” alongside photos of multicultural twenty-somethings and comfortable middle class consumers enjoying wine on the wharf, hosing down their yachts, and shopping for designer handbags. The developer Mike Ghielmetti, a long-time supporter and financial backer of Jerry Brown and current Oakland mayor Jean Quan, has set up a web site trumpeting that, “a diverse mix of residents will further enliven this part of the City, establishing it as a flourishing place for people to enjoy.” Gheilmetti told Forbes magazine that he’d love to see Chinese buyers scoop up Brooklyn Basin’s condos when they hit the market.

But like the WOSP, Brooklyn Basin is being built from the ground up to attract a diverse mix of residents within certain parameters. It’s bounded diversity; restricted to people whose income and cultural capital exceeds that of the city’s current majority. Brooklyn Basin is a plan to develop Oakland as a place, not as a people. Although the 2006 development agreement between Oakland and Ghielmetti required building affordable housing on-site, the total was only 15 percent of the project’s 3,100 units, or about 465 homes. This proportion totally reverses the actual ratio of above median income households to below median income households that currently live in the neighborhoods surrounding Brooklyn Basin. One in every three families living next to the site where Brooklyn Basin’s towers will soon rise is living below the poverty line, and the neighborhood’s median family income is $37,000, about 22 percent below the median household income for the entire city.

Perhaps some Oaklanders from the working class half of the city will find jobs building Brooklyn Basin. Or perhaps they’ll find jobs in the stores and restaurants that open there. But economic progress along these lines is an afterthought, and it’s also not necessarily progress. What will these jobs pay? Will the workers be able to keep up with the rising rents and other cost of living increases that come when a city truly becomes a destination for wealthy Chinese condo owners and Silicon Valley executives and lawyers buying second homes along Oakland’s waterfront?

Recent mayors and city council members have shown, in their efforts to transform Oakland, that they can conceive of the city as a people. Progressive public policies like a living wage ordinance, local hire requirements for city contracts, and most recently a majority on the city council supporting a significant city-wide minimum wage increase are among the most obvious measures taken to “lift up Oakland.”

But the city-as-a-place, as an investment platform upon which to assemble objects and spaces of consumptive desire, has long dominated the thinking inside One Frank Ogawa Plaza, City Hall. In their e-mail signatures, Oakland politicians and city staff are in the habit of including a link to a 2012 New York Times article ranking Oakland the #5 top place to visit in the world. The city that’s being made right now is increasingly incompatible with the city that is. The Oakland as-a-place being built is too expensive for the Oakland-as-a-people who live here. Where will they go? Likely further into East Oakland, the last section of the city that because of its geographic isolation from the downtown, and because of its deeply entrenched poverty, is not a destination, is not drawing in the same kind of speculative capital and middle class home buyers. To Richmond, Vallejo, Antioch and Pittsburg, and other non-destination cities further up and off the BART lines and under the shadows of refineries and power plants the displaced will move.

Next week the Oakland city council’s community and economic development committee will likely green light a 250 to possibly 400-unit residential building at 2100 Telegraph Avenue. The developer, Alan Dones, has already built offices and apartments in Oakland’s Uptown. Like most other big real estate projects requiring city assistance (Dones’s proposal is to build atop a city-owned parking garage) the city has significant say in what gets built, but the project’s plan only calls for 15 percent of the units to be affordable to moderate and low-income households.

And what does affordable even mean? Per Oakland’s official Housing Element, a state mandated plan, this would mean apartments that a single person earning $45,100, or a three person households earning $58,000, can afford. These are the official definitions of “low income” in Oakland. Moderate income is defined as a single person earning $74,950, and a three person household with an income of $96,350.

Screen Shot 2014-10-09 at 11.18.56 AMNo one who has ever set foot on the corner of Telegraph Avenue and 21st Street, where Dones’s project will be built, could possibly think for a second that these income levels approximate those of the neighborhood’s current residents. The reality of life in Oakland’s flatlands is that many households earn below $25,000 a year, and they must spread these meager dollars far to feed many mouths, pay ever-increasing rents, and pay for a highly regressive set of municipal services, from trash to transit. Even the affordable units, it appears, will be priced to attract outsiders. Uptown Oakland is in fact one of the most impoverished urban zones in California. The poverty rate in the surrounding Census Tract is 44 percent. Over half the neighborhood’s households earn less than $25,000 a year.

Ultimately the problem isn’t that too much market-rate housing is being built. It’s that too little affordable housing is being added to the city’s total stock. The authors of Oakland’s Housing Element admitted as much when they wrote the following:

“the City encountered some difficulty in achieving very low-, low- and moderate-income housing production goals in the 2007-2014 planning period. The increasing gap between housing costs that very low-income household can afford and the cost of producing very low-income housing units, combined with the limited amount of subsidies to produce such housing, continues to challenge the City’s ability to meet ABAG’s regional housing allocation for the City for these households.”

What’s getting built isn’t designed to benefit the people of Oakland who are already here and need something better. More so, there’s too much time and energy spent by Oakland’s government greasing the gears of real estate development at any cost, and not enough time crafting policies to make the city an economically just community. The result is what many of the people of Oakland feel today; their city is becoming unaffordable. Evictions are increasing in areas like North and West Oakland where huge demographic shifts are taking place. The city appears (although it isn’t) powerless to create good paying jobs for its existing residents, but it can and soon will create a surplus of expensive real estate. It’s all the result of seeing and treating Oakland as a place, and not as a people.