Tom Butt
  E-Mail Forum – 2021  
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  Campus Bay, the RPA and the City Attorney
July 24, 2021

The shitshow at the July 22, 2021, City Council meeting wherein the RPA City Council members tried to summarily and illegally suspend the mayors discretion to cancel a City Council meeting was a result of my canceling meetings on July 20 because of an attempt by the city attorney to agendize a public hearing on Campus Bay for the questionable purpose of terminating the development agreement.

Following is what was on the July 20 morning Agenda:

HOLD a public hearing to consider whether the Development Agreement and Project Approvals should be terminated if HRP Campus Bay Property, LLC does not obtain fee title to the property - City Attorney's Office/Community Development Department (Teresa L. Stricker 510-620-6509/Lina Velasco 510- 620-6706).

First of all, this was a legal question, not something for the public to debate. I can’t see any constructive purpose for a couple dozen wackos to weigh in with the same Campus Bay remarks we have been hearing at every City Council meeting for months.

Here is the issue. The City has the discretion to terminate the Campus Bay Development Agreement if the developer fails to take fee title at a prescribed time, which was July 19, 2021. The developer took title to the property on July 13, 2021, and duly notified the City. Following is the pertinent language:

1.3.3 Failure to Take Title. Notwithstanding any provision to the contrary herein or in the Project Approvals, in the event that, for any reason whatsoever (and without any allowance for Permitted Delay), Developer shall fail to take fee title to the entire Property ("Fee Title") within 180 days following the Effective Date ("Fee Title Deadline"), either Party may elect, in its sole and absolute discretion, and upon written notice to the other Party within sixty (60) days following the Fee Title Deadline, to terminate this Agreement and the Project Approvals. If Developer acquires Fee Title after the Fee Title Deadline, but before the City provides such written notice to terminate this Agreement and the Project Approvals, then this Agreement and the Project Approvals shall remain in full force and effect in accordance with their terms. Effective upon such termination by either Party, this Agreement and the other Project Approvals (notwithstanding any provision to the contrary in the Project Approvals) shall be of no further force or effect, except for any provisions of this Agreement that are expressly stated herein to survive the termination of this Agreement, and provided that such termination shall not relieve or release Developer from any obligation under any Reimbursement Agreement(s) between the Parties with respect to the Project or any obligation or liability for any Developer Event of Default arising prior to such termination. Without limiting the foregoing, the provisions of the preceding sentence regarding the termination of the Project Approvals upon the termination of this Agreement for failure of Developer to take Fee Title by the Fee Title Deadline shall survive such termination of this Agreement.

If you read Campus Bay - A Failed Ethical Dilemma for the City Attorney, July 16, 2021, and Campus Bay Developer Takes Title to Property, July 19, 2021, you already know that the preparation for the public hearing related to Campus Bay proposed for the morning of July 20 was plagued by poor staff work, a lack of authority to set the hearing and a questionable need for the hearing at all. To avoid wasting time, I used my mayoral discretion to cancel the meeting.

But they persisted. The city manager and city attorney simply moved the Campus Bay public hearing to the evening meeting scheduled for July 20, 2021. I tried to talk them out of it, but they cited various questionable legal justifications and were unmoved. Again, I used my mayoral discretion to cancel the meeting.

The property generally consists of two parts. One of those parts, a fraction of the size of the other, is a strip adjacent to the UC Field Station (Parcel 10) that is jointly owned by the developer (as of July 13, 2021) with a 2/3 interest and by the UC Regents with a 1/3 interest. The purpose of the public hearing apparently is to debate whether the 2/3 interest in the Parcel 10 strip constitutes “fee title to the entire property” under the Development Agreement. Egged on by the city attorney, the RPA City Council members, in a “gotcha” move would argue that it does not, and would act to terminate the agreement.

The key to understanding this is the definition of “property,” defined in the Development Agreement as “certain real property located within the City consisting of approximately 89.6 acres and more particularly described on Exhibit A attached hereto and generally depicted on Exhibit B attached hereto.”  The legal description from the Development Agreement describes Parcel 10 as follows, and clearly limits the “Property” to an undivided 2/3 interest in Parcel 10:

The legal description in the Deed in Lieu of Foreclosure is the same, and confirms that HRP Campus Bay Property, LLC took title to that 2/3 interest in the property:

If the RPA City Council members were successful in voting to terminate the Development Agreement on this twisted line of reasoning, it would almost certainly result in prolonged and expensive litigation in which the City would have little chance of prevailing.