Oliverio for Supervisor 2018

Independent - Transparent - Fiscally Responsible

Park in the Sky or Pie in the Sky?

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Planning departments across the USA commonly create “specific plans” and/or “master plans” for certain streets and neighborhoods within a city. San Jose, not unlike other cities, has many of these same plans.

These plans tend to have colorful illustrations depicting what life in the future would be like, and almost always seem to be utopian in nature: happy residents walking with their animal companions in tow, people on bikes, massive parks that melt into the horizon, cafes filled with laughing people laughing, and my favorite … children with balloons.

Most of the time these plans are put together with the best of intentions, but they end up sitting on a shelf due to their inherent lack of practicality or feasibility. For example, many of these plans depict large parks that have no funding source—this is deceptive. If a plan calls for a large park, then many market rate housing units are required to fund that park. (Only market-rate housing, not affordable housing, pays 100 percent of park fees.) In one instance in my district, Cahill Park could have been larger. However, the City Council prior to my tenure approved a housing development that was less dense, and therefore a smaller park resulted.

Sometimes staff solicits ideas from the community, and in doing so propagates a false hope that can only exist in an alternative universe separate from our fiscal reality. For example, one idea involved building a park “in the sky” over the 280 freeway, which would have ended up costing approximately $100 million. This idea should have been eliminated instantly, due to the prohibitive cost. Instead, it was kept alive by the somewhat absurd notion that San Jose voters may someday tax themselves to support a nine-figure project.

In the past, staff and ultimately the council have limited the development potential in a specific plan area when it has been deemed that residents would prefer to maintain the status quo. Case in point, based on community feedback, the 1998 Alviso Master Plan limited the construction of any new industrial office buildings to one or at most two stories on North First Street.  The unfortunate consequence of the height limitation is that we have had to forgo market driven demand for taller, 5-8 story buildings. In effect, this specific restriction in the premier technology corridor of San Jose has limited the city’s economic development as a whole.

An alternative approach that would be more conducive to economic growth would involve first identifying a limited number of job creation sites in San Jose located within specific plan areas. We should then re-examine any existing limitations within these job creation sites and remove any restrictions that may block private investment, as in the Alviso example cited above.

Another reason these plans are often doomed to failure can be attributed to the fact that a private property owner may simply not want to develop their land. In other instances, residents will express a desire for a new park on land that is privately owned, and oftentimes this same parcel has an existing structure with tenants already in place. At the end of the day, America is a country that places high value, rightfully so, on private property rights. Thus, successful development is most likely to occur when the private property owners themselves initiate plans, not when an outsider who does not actually own the property injects impractical conceptual drawings into the process.

Currently, staff is planning the development of “Urban Villages,” with the goal of mixing residential and employment activities. Furthermore, the development of such villages would establish minimum densities designed to support transit use, bicycling, walking, high-quality urban design, revitalization of underutilized properties, and the engagement of local neighborhoods and private property owners in the process. Here is a map of the future Urban Villages.

Having attended three Urban Village planning meetings in October, it is my hope that the plans ultimately approved by council are realistic and allow for expedited development. However, I believe a disclaimer acknowledging private property rights should be on the first page of any proposed plan, and that ultimately development will be initiated on a timetable that government cannot control—especially if the plans are too far from market realities.

Sometimes, a proposed development is in harmony with a pre-existing plan, but just as often this is not the case. In either instance, my objective as a councilmember has always been to consider different points of view and support or oppose development based on the long-term economic benefits to San Jose as a whole.

We Pay Twice for Affordable Housing

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In past blogs I have expressed my concern about the cost to our city of too much housing. Specifically, housing that does not pay its own share of revenue. One example I have pointed out—and constantly been the lone vote against—is affordable housing.

We run the daily operations of our city with tax revenue. The city does not write paychecks signed “goodwill” or “number-one provider of affordable housing,” but rather with dollars backed by tax revenues. So when we add to the housing stock by approving, for example, an affordable housing project that does not pay property tax, road-paving fees and only 50 percent of park fees, it is a net loss for our city. Therefore existing residents subsidize city services for the new residents.

Annual property taxes in San Jose are needed to pay ongoing salaries and benefits of employees. Road-paving fees go towards paving streets in San Jose. If you ride a bicycle or drive a car you know that we need every dollar. Park fees allow for new parks or increasing the size of current parks so we do not wear out the existing park infrastructure in established neighborhoods.  For years developers were exempted from paying park fees for affordable housing projects which created more residents but not enough open space. However last year with the support of the city council I managed to get it changed to where developers must now pay half the park fees that market-rate housing pays.

The other item of interest is that affordable housing generates extraordinary calls for service from our police.  Attached is a snapshot of data for eight affordable housing developments in San Jose and the calls for police service. Since there are more calls for service around these affordable housing projects, over time our police department may schedule more police in this area to manage those calls. This may translate to less police coverage in other areas of San Jose, perhaps where you live.  In addition, our fire department receives more medical-related calls, and again there’s no tax revenue to pay for the employees.

So we pay twice. Once, by exempting taxes and fees. Twice, by higher use of city services than existing residents. (Also, most of these projects were financed with RDA funds, and the State of California mandates that 20 percent of that money be spent on affordable housing. And many of these projects were put in places zoned for jobs and not housing.)

Out of the many suggestions I have made on this topic I believe affordable housing developments that have too many calls for service should hire an off-duty officer and/or ambulance to be there on site.

Here is a link to 730 police calls on eight housing developments, among some 11,000 units built.

On another topic, one of my favorite Downtown events starts Tuesday night, The Cinequest Film Festival. Check it out at Cinequest.org.

Related to cinema I obtained a documentary film about urban parks directly from the filmmaker called The Olmstead Legacy.  Monday, March 7 at 6:30PM will be the premiere showing in San Jose at City Hall. Find out more about The Olmstead Legacy here. The film will be followed by a discussion on urban parks. The event is near capacity; please email me if you want to reserve one of the remaining seats at Pierluigi.Oliverio@SanJoseCA.gov

Finally, the bipartisan Little Hoover Commission, an independent state oversight agency, made its recommendation to Governor Brown about pensions last week:

Read the Feb. 24, 2011 Little Hoover Commission Report here.

2011 City of San Jose Community Budget Survey

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The City of San Jose contracted with a public opinion organization to conduct a telephone poll of 1,000 San Jose residents. Residents will be asked survey questions about the budget and city services from Jan 13 to Jan 17.

The results of the phone survey will be shared in February. Please note I received a draft of the survey and some of the questions have been edited.

Since only 1,000 people will get a call out of one million residents, I wanted to provide an opportunity for you to partake in the survey via the internet.

http://www.surveymonkey.com/s/RG9LCPN

This survey closes Jan 30.
If you appreciate urban parks than consider attending the San Jose premiere of The Olmstead Legacy film. March 7 at City Hall. For more info click here:http://tinyurl.com/OlmstedLegacy

Decisions on Housing Types Affect Future Tax Revenue

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Unfortunately, not all housing developments create the same economic value in areas assigned to the Redevelopment Authority (RDA). Last week, the council approved financing for an affordable housing development on North 4th Street in a RDA area. Since the housing developer is a non-profit, the development is exempt from paying property tax.

In addition, the fees that are paid for a market-rate development—road paving fees and park fees, to name two—are exempt from this project as well and all other projects like them. (Point of clarification, this project was entitled prior to the Council cutting the park fee requirement in half for affordable housing. I remain committed to my support of 100 percent park fees for affordable housing developers).

Locating affordable housing in an RDA area creates a lost opportunity for tax increment revenue for RDA ,since projects are exempt from property tax. As a result this type of housing does not fund ongoing city services in non-RDA areas that the new residents will require (usually at a higher rate than market-rate housing). It also shortchanges the RDA because RDA needs the tax increment from the increase in property value which then could be invested towards economic development. This housing development is a financial loss and therefore I voted no.

One way to fix this is to require that affordable housing be built by a for-profit developer so it would be subject to property tax. We would still provide affordable housing but it would help to carry its own weight in paying for city services.

At the same meeting, the Council agreed to a multi-year exemption for four north San Jose housing developments from the citywide inclusionary housing policy, which may bring in over $1 billion in private-sector spending. The current San Jose inclusionary policy has been blocked in the short term for apartments only by the Palmer court case. These developers would commit to start their housing projects by September 2011 to qualify for the exemption; however they want to make sure the exemption would not change half way through construction if the State Legislature passes a law to circumvent the Palmer case. This is an example of how an inclusionary housing policy raises the cost for the developer and inevitably increases the price for the market-rate units.

The short-term benefit would be thousands of construction jobs and city planning jobs for these 4,000 housing units that were approved as part of the Vision North San Jose plan ,where the city already has public infrastructure like roads, sewers, street lights, etc. The long-term benefit is that these housing developments are market rate and pay property tax. When the construction is complete the property is reassessed and that increase in value creates millions of dollars in tax increments to fund the RDA each year—ideally to be spent on economic development.

These market-rate developments will also provide 100 percent park fees, creating large parks since they are all high-density developments and the park fees are paid on total amount of units. More housing units per acre equals more park fees.

Tomorrow night Council will consider a new policy (I support) allowing these apartment developments to donate maintenance services for parks so there would be no cost to the City, but enabling residents to enjoy a well-maintained park. They will also pay 100 percent of the road paving fees.  If a city has a RDA to create tax-increment revenues, then ideally each parcel in that RDA area should be strategic for revenue growth.

Please consider attending the Veterans Day parade in Downtown San Jose this Thursday. The ceremony is at 11am and parade is at noon.  1919 was the first Veterans Day event in Downtown San Jose and it is an opportunity to honor those who have served in our military.

From Last Place to First

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As most of you are most likely aware from the front page article in the San Jose Mercury News on August 12, The San Jose Municipal Rose Garden was selected as America’s Best Rose Garden. What an incredible achievement! Congratulations and thanks to all involved including the paid park maintenance city staff and the non paid volunteers.

The rebirth of the Rose Garden could not have been done by only park maintenance staff or only by volunteers. It is the combination of both that allows for this fantastic achievement. And the leadership of Beverly Rose Hopper and Terry Reilly.

Just over three years ago, I walked through the Rose Garden park with numerous concerned neighbors and saw the decline and devastation. I knew then that our City did not have the resources to pay for staff to care for the park, nor would a band-aid approach allow the park to reach its potential.  I also knew the City was behind the times with it’s volunteer policy. Instead, I proposed a pilot for outsourcing park maintenance. That caused the unions to assemble and defend the status quo.

Bringing up the topic of outsourcing allowed for the larger message to get out that this park and other parks need attention, especially with our structural budget deficit. Although outsourcing park maintenance, even as a pilot, was not approved in May 2007,  I did push for and was successful in having council support amending the City’s volunteer policy in October 2007.

I remember asking several times then-Vice Mayor Dave Cortese to accept my friendly amendments to allow more flexibility in the volunteer policy,  including a stipulation that corporations be allowed to have their employees donate time at San Jose parks on their community service days.  This change allowed 250 Google employees and 150 Recology employees to volunteer in the Rose Garden this summer, for example.

The Municipal Rose Garden is a city landmark and now a national one.  Volunteers include residents of San Jose and people from all of over the county. The volunteers are doers and not talkers, as they enjoy giving back to the larger community. I think they serve as an example of the JFK quote (with a twist): “Ask not what your city government can do for you, but what you can do for the community you call home.”

Municipal governments will continue to shrink as revenues will be constrained as pension costs rise. Therefore—now more then ever—residents could provide small increments of their time improving their local park, trail, traffic medians etc… Waiting on government will be taking longer then ever before.

However, residents may ask a fair question as to why cities do not do more to provide services at a lower cost.  As the Wall Street Journal reported recently, San Jose will be saving approximately $4 million a year by outsourcing janitorial. The $4 million in savings was substantial enough to garner national attention and is the trend nationally.

I am very proud to live in a city where doers start with a dead vine and do not give up.  As a result of the conviction from the Rose Garden volunteers, the City of San Jose Rose Garden is Number One!

Prioritizing Services That Touch Residents

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Hope your Fourth of July holiday was fantastic. On June 29, prior to the holiday the Council made the final vote for a balanced budget. More than 20 people spoke at the Council meeting and all but one advocated that the Council not outsource janitorial services but rather keep the janitorial staff employed, since they provide an incredibly valuable service. You would have thought janitorial was listed in the city charter by the speakers’ comments.

All but one of the speakers advocating for the janitors were affiliated with a labor union or religious congregation. The religious leaders ranged from Methodist to Lutheran to Jewish to Presbyterian. I understand the brotherhood and sisterhood concept of labor unions uniting to advocate for spending taxpayer money to help another union member. I also understand the calls for social justice from the clergy. However I wonder if the janitor at the church or temple makes approximately $55K a year plus a 250 percent pension match and free lifetime medical (minus co-payments) for themselves plus spouse/partner. My guess is no.

The Council was called, “shameful” and criticized for “picking on the most vulnerable.” There were undertones of racism, since the majority of janitors are not caucasian.

The notion that janitors make the least amount of money is incorrect, as I have stated for months. A recreation leader in our parks and community centers makes in salary only $38,001 and a senior recreation leader makes $54,496. A library clerk makes $50,897 in salary only while a senior janitor makes $54,787 in salary only.

So since all three of these positions come from the same pot of money and around the same dollar amount, then it is a trade-off. If the Council chose to not lay off and outsource the janitors we would have to make those same cuts elsewhere to lay off staff that work in our community centers, or lay off staff that work in our libraries.

I chose and will choose to keep services that actually touch the million-plus residents of San Jose over services that do not add value for our residents. The ability to have a community center or library open is more valuable to our residents then who cleans City Hall.  The new janitorial staff will be paid like janitors at Cisco and Apple but possibly more with the city of San Jose’s living wage requirement.

A big thanks you to the Alameda Business Association and Larry Clark for another great Rose, White & Blue Parade on Sunday! Congratulations to Cleveland Ave for winning 1st prize in the parade (three years in a row) for their creative float.

Finally, as an observer early this morning it was quite a sight to see six out of 35 stations working on suppressing the fire at Trace Elementary. Thank you to our Fire Department—fortunately there were no major injuries.