Insight Terminal Solutions Oakland OBOT Update: City Violated It’s Developer Agreement

Oakland via The Internet- In this Insight Terminal Solutions (ITS FAQ) Oakland OBOT Update we learn, and are reminded, that the City of Oakland (in this case represented by Oakland Mayor Libby Schaaf and Oakland Councilmember Dan Kalb of District 1) openly and willfully violated its own development agreement with California Capital Investment Group Managing Director Phil Tagami and Prologis in 2013. That was in the process of creating the Oakland Coal Ban that was struck down in court in 2018.

That assertion comes from a clear text from the same development agreement that mentions the City of Oakland (as “City”) and dated: July 16, 2013:

3.4.I Future City Regulations. Except as otherwise specifically provided in this Agreement, including, without limitation, the provisions relating to (a) regulations for health and safety reasons under Section 3.4.2 below; (b) regulations for Construction Codes and Standards under Section 3.4.4 below; and (c) provisions relating to the payment of City Application Fees pursuant to Section 3.4.5, below, City shall not impose or apply any City Regulations on the development of the Project Site that are adopted or modified by City after the Adoption Date (whether by action ofthe Planning Commission or the City Council, or by local initiative, local referendum, ordinance, resolution, rule, regulation, standard, directive, condition, moratorium that would: (i) be inconsistent or in conflict with the intent, purposes, terms, standards or conditions of this Agreement; (ii) materially change, modify or reduce the permitted uses 01″ the Project Site, the permitted density or intensity of use ofthe Project Site, the siting, height, envelope, massing, design requirements, or size ofproposed buildings in the Project, or provisions for City Fees specified in Section 3.4.5 below and Exactions as set foflh in the City Approvals, including this Agreement; (iii) materially increase the cost of development ofthe Project (subject to the acknowledgement as to the cost of Exactions specified in Section 3.4.6 below); (iv)materia11y change or modify, or interfere with, the timing, phasing, or rate of development of the Project; (v) materially interfere with or diminish the ability of a Party to perform its obligations under the City Approvals, including this Agreement, or the Subsequent Approvals, or to expand, enlarge or accelerate Developer’s obligations under the City Approvals, including this Agreement, or the Subsequent Approvals; or (vi) materially modify, reduce or terminate any of‘ the rights vested in City Approvals 01′ the Subsequent Approvals made pursuant to this Agreement prior to expiration of the Term. Developer reserves the right to challenge in court any City Regulation that would conflict with this Agreement or reduce the development rights provided by this Agreement, provided that such City Regulation directly affects the Project; provided, however, Developer shall first follow the dispute resolution procedures in Article VIII.

That entry in the development agreement also formed the basis for Phil Tagami’s successful attack on, and court rejection of, the Oakland Coal Ban that was approved by the Oakland City Council on Monday, June 27, 2016.

As Vince Chhabria, Judge of The United States District Court for the Northern District of California, wrote in the opinion framing his order for the City of Oakland to terminate the Oakland Coal Ban that was targeted at Insight Terminal Solutions OBOT Development:

As a general matter, development agreements are contracts between local governments and developers that freeze existing zoning and land use regulations into place. These agreements are intended to provide developers with a measure of certainty that new and unexpected government regulations will not stymie their projects, particularly when the projects require years of investment, government approvals, and construction. Consistent with this general approach, the agreement between the City and OBOT includes a provision that prevents the City from imposing new regulations on the terminal project after the date on which the City signed and adopted the agreement. Development Agreement § 3.4.1 (Ex. 584.0022-0023); see Save Tara v. City of W. Hollywood, 45 Cal. 4th 116, 138 (2008); Santa Margarita Area Residents Together v. San Luis Obispo Cty., 84 Cal. App. 4th 221, 226-27 (2000). But there are a few exceptions, one of which is section 3.4.2 of the agreement. Section 3.4.2 allows the City to apply a new regulation to the project if the City has “substantial 8 Case 3:16-cv-07014-VC Document 249 Filed 05/15/18 Page 9 of 37 evidence” that failure to apply the regulation would create a “substantial danger” to the health or safety of current or future users, occupants, or neighbors of the project. Specifically, section 3.4.2 of the development agreement states, in relevant part: Notwithstanding any other provision of this Agreement to the contrary, City shall have the right to apply City Regulations adopted by City after the Adoption Date, if such application (a) is otherwise permissible pursuant to Laws (other than the Development Agreement Legislation), and (b) City determines based on substantial evidence and after a public hearing that a failure to do so would place existing or future occupants or users of the Project, adjacent neighbors, or any portion thereof, or all of them, in a condition substantially dangerous to their health or safety. Development Agreement § 3.4.2 (Ex. 584.0023). There is a common understanding in the law of the meaning of the words “substantial evidence,” and there is no indication that Oakland and OBOT intended a different meaning. “Substantial evidence” is “such relevant evidence as a reasonable mind might accept as adequate to support a conclusion,” so long as it is “reasonable in nature, credible, and of solid value.” City of South San Francisco v. Workers’ Comp. Appeals Board, 20 Cal. App. 5th 881, 896 (2018) (quoting Braewood Convalescent Hospital v. Workers’ Comp. Appeals Board, 34 Cal. 3d 159, 164 (1983)).

And Judge Vince Chhabria Blasted The So-Called OBOT / Global Warming Connection In The Same Opinion

Judge Vince Chhabria
Judge Vince Chhabria

This entry from Judge Chhabria attacking the idea that Insight Terminal Solutions CCIG OBOT will cause or add to the Global Warming problem deserves highlighting…

The hostility toward coal operations in Oakland appears to stem largely from concern about global warming. To be sure, shipping coal for use in other countries will make some contribution to the accumulation of greenhouse gases in the earth’s atmosphere, and climate change is detrimental to public health and safety. But the City’s argument that global warming allows it to invoke section 3.4.2 of the development agreement barely merits a response. It is facially ridiculous to suggest that this one operation resulting in the consumption of coal in other countries will, in the grand scheme of things, pose a substantial global warming-related danger to people in Oakland.

Finally, Judge Chhabria wrote this….

Fred Blackwell Said OBOT Was Designed To Be Environmentally Friendly In 2013

The City of Oakland’s own administrative instability has contributed to the problem of disagreement in the development of OBOT. If Fred Blackwell (now the CEO of The San Francisco Foundation) had remained as the City of Oakland’s Chief Administrative Officer, his presence and history with the Insight Terminal Solutions OBOT project could have cancelled any politically-motivated attempt to derail the project. Indeed, this 2012 Zennie62 on YouTube interview gives reason to believe so:

Tom Steyer Wife Kat Taylor Pictures
Tom Steyer and Wife Kat Taylor

The main question that’s never been answered is how did Oakland’s politics come to change to a point where some worked to undermine the same Insight Terminal Solutions OBOT project that the City of Oakland helped create? One part of the total answer may be in Oakland Mayor Libby Schaaf’s relationship with Tom Steyer and his wife Katherine Taylor. Kat Taylor recently gave $5,000 to Mayor Schaaf as part of a Junior State of America “Meet The Mayor” fund-raiser held not in Oakland, but at Manny’s in San Francisco.

Libby Schaaf And Zennie Abraham
Libby Schaaf And Zennie Abraham (left)

Kat Taylor and Libby Schaaf have also attended and presented at a number of events, like Aspen EPIC in 2017, or the opening of a Greenlining Center in 2017, or the 2018 $500,000 donation “Tom and Kat” reportedly gave Mayor Schaaf for the Oakland Promise program. While there’s no direct connection to a quid-pro-quo that would have given rise to the Oakland Coal Ban, it’s not off-base to say that there’s a lot of relationship smoke pointing to a possible fire in the past.

Stay tuned.

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