In November of 2004, after a prolonged period of soliciting proposals for the development of Point Molate, the City Council had only a single viable proposal -- the project by Upstream and the Guidiville Band of the Pomos to build a destination resort with a casino. At the last minute, on November 9, 2004, Chevron made a move, offering an $80 million purchase package but with murky commitments to any future development, especially to the rehabilitation and reuse of the historic Winehaven buildings.
On November 9, 2004, the City Council met to consider the two offers. In my November 10, 2004, E-FORUM, I wrote:
Last night, the City Council voted 6-2-1 to approve the Land Development Agreement (LDA) with Upstream for an option to purchase Point Molate to construct a destination resort that is intended to include a casino. Dissenting were Maria Viramontes and Charles Belcher. Mayor Anderson abstained.
Chevron, however, did not go quietly into the night. They retained Willie Brown to try and uno the deal, and they ultimately, but unsuccessfully, sued the City of Richmond. Following is media coverage immediately after the decision:
I supported the Upstream LDA for several key reasons:
- It included commitments to build and maintain approximately the same park, open space and trail components that were in the Reuse Plan approved by the City Council in 1997.
- The areas proposed for development are limited to adaptive reuse of the existing buildings in the Winehaven Historic District and the brownfield areas previously used by the Navy for structures and storage facilities. The currently undeveloped areas will remain as open space.
- There are substantial commitments for economic activity, taxes, jobs and other payments to the City that can be used city-wide.
- If the casino falters, Upstream is willing to quickly switch to a development model that more closely resembles the mixed use alternate of the Reuse Plan, which includes hundreds of housing units.
My principal hesitation on the Upstream LDA was the casino. Clearly, there are a number of Richmond residents, including many friends, neighbors and others I deeply respect who are adamantly opposed to a casino in Richmond. Some are opposed because they believe it will adversely impact their quality of life and that of others by increasing traffic congestion, crime or undesirable newcomers. Others cite the adverse societal impacts of gambling. All of these are important, but like anything, they have to be balanced by potential benefits. Richmond’s huge backlog of capital projects, including a rehabilitated City Hall and over $200 million of street repairs looms large. So does the approximately 10% unemployment in Richmond’s flatlands.
Some people have urged further delay. Others say we are selling too cheaply. I have been struggling with Point Molate and fighting for the right project for some nine years. It was time to make a move. Both the ChevronTexaco and Upstream proposals for Point Molate are within the envelope of fair market value. We have good recent comparables, such as the Toll Brothers housing project at the former Terminal 1 to establish values. The idea that Point Molate is worth hundreds of millions is just unsupportable.
Doing nothing or waiting for some future angel is not tenable. It costs hundreds of thousands of dollars a year to secure and maintain Point Molate, including continuing to stabilize and weatherproof dozens of Winehaven buildings listed on the National Register of Historic Places. The City simply does not have the money to sit by and do nothing for an indeterminate period of time.
The ads and phone calls paid for by ChevronTexaco have led many people to believe that the Upstream proposal does not provide parks, trails and open space, while the ChevronTexaco proposal does. In fact, just the opposite is true. The ChevronTexaco proposal provides no specific guarantees for parks, trails and open space, including public access, as well as adequate funding for construction and maintenance.
I have been in periodic contact with ChevronTexaco representatives for months. I wanted a competitive proposal that I could feel comfortable supporting. In the last few days, I have pleaded and begged them time after time to modify their proposal to make clear commitments to parks, trails, open space, public access, historic preservation, jobs, and economic activity, but they turned a deaf ear. They simply said, “trust us.” How can you trust someone who mounts an ad, phone and political campaign costing hundreds of thousands of dollars that is completely filled with bald faced lies?
Yesterday, at the eleventh hour, some members of the City Council tendered a counteroffer to Upstream that substantially improved the draft LDA. The non-refundable deposit was increased 300%, from a maximum of $5 million to a total of $15 million. Additionally, language was incorporated that guaranteed that one-third of new jobs would go to Richmond’s most needy residents, so long as there are sufficient qualified applicants.
In trying to assess the mood of Richmond residents about these two proposals, I had to sort through a lot of communications via email, phone calls, and personal contacts, some of which were obviously based on erroneous information provided by ChevronTexaco. My best guess is that if a referendum were to be held today on the two proposals, Upstream would prevail by at least 60-40.
Of those of you who were disappointed in my vote, I hope you will forgive me. I take seriously my representation of all the people, and it is my perception that a majority support the Upstream selection as opposed to ChevronTexaco. The ChevronTexaco proposal had a lot of dollars up front but no other commitments. Regardless of opinions about the casino, virtually all of the people who have contacted me about this project were clear that they wanted parks, trails, open space and public access. The ChevronTexaco proposal simply didn’t make that commitment.
This project will have to undergo the full scrutiny of an EIR, including review by the Design Review Board. There will be many opportunities for public input, and mitigations for negative impacts, such as traffic congestion, are required by law. It is not inconceivable that there may have to be substantial changes in the plan or that it simply won’t pass muster. It is premature to assume that it will be “tacky.” In fact, the current plan is for the entire casino component to be housed in the existing barrel cellar, that historic building that must be rehabilitated according to the secretary of the Interior’s Standards, which means the exterior will retain its historic appearance.
At any rate, the contract is a done deal, and the next job of all of us is to be prepared to examine and critique the plans as they develop and make sure that every component is consistent with good design, public access, environmental sensitivity and minimal adverse impact on the community.
Point Molate casino on track after City Council OKs proposal
Willie Brown enters fray for Chevron, which is fighting deal
- Cecilia M. Vega, Chronicle Staff Writer
Thursday, November 11, 2004
The sight of spinning cherries and big jackpots in Richmond may still be years away, but a casino developer is forging ahead with plans to bring Indian gaming to the shores of Point Molate now that the City Council has approved the proposal.
But no one expects Chevron, which opposes the casino proposal and made an $83 million bid for the land, to surrender just yet.
The refinery has hired former San Francisco Mayor Willie Brown to lobby the City Council, and city insiders say Chevron may put the issue to a public vote in March.
The City Council voted 6-2 late Tuesday to sell the former naval fuel depot to Upstream Development and its partner Harrah's for $50 million. Council members Maria Viramontes and Charles Belcher opposed the deal; Mayor Irma Anderson abstained.
Within hours of the vote, Jim Levine, head of Upstream, said he was preparing to start the application process to turn the property into a reservation for the Guidiville Band of Pomo Indians, which hopes to open a casino with a resort hotel and shopping center.
"The process will be formally kicked off in the next 60 days or so," he said Wednesday.
The next step is an environmental impact study of the proposal, a process that involves lengthy hearings where the city and the federal Bureau of Indian Affairs would hear public comment.
The proposal still faces significant governmental hurdles and ultimately requires approval by the U.S. secretary of the Interior, a process that typically takes years.
Clay Gregory, director of the Bureau of Indian Affairs' Sacramento office, said the Point Molate proposal had yet to cross the agency's radar.
"To the best of my knowledge we haven't been contacted by the tribe on this," he said Wednesday.
The Richmond City Council has final say over the project's design and scope, "even whether there will be a casino or not," Levine said.
If the casino deal is not approved, the developer plans to build 800 condominium units and the resort complex.
Richmond will see its first $1 million check within 21 days, but city officials say the money has largely been spent on legal fees and maintenance costs for Point Molate.
Over the next five years, the city could receive as much as $15 million. Upon the close of escrow, the city will have received a total of $20 million in cash and a $30 million promissory note to be paid over 15 years.
Chevron spokesman Dean O'Hair said he was disappointed by the city's approval of the casino. The company has long said a casino would threaten the security of the refinery it operates adjacent to Point Molate.
"Now, we've got to go back and just kind of think about where we are and consider a range of options for what's next," he said.
Emblematic of the high-stakes public relations campaign waged by both sides to win over public opinion, O'Hair said Brown -- who served 14 1/2 years as speaker of the state Assembly -- works as a consultant for Chevron, and "the mayor has helped us ... presenting some of the concerns that we've raised."
Brown did not return calls Wednesday. But Councilman Nat Bates said he had recently received a phone call from Brown, who wanted to know how Bates would vote.
"Chevron just didn't utilize him the way he should have been utilized," Bates said of Brown. "He could have had some influence had he gotten involved earlier in the game. He's a lot more influential than the guys they used (early on)."
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Casino Plan Gets Key Approval in Richmond
Richmond is taking a gamble.
The city has sold a prime piece of waterfront property at Point Molate for $50 million to a developer with plans to build a casino and resort hotel. Slot machines in Richmond are now a real possibility.
The project, proposed on behalf of Pomo Indians, offers more than gambling. A city council member says the plan includes a park, trails, open space, jobs, and historic preservation. However, the casino is the big moneymaker.
"It may not be the perfect answer everybody would dream of," said council member Tom Butt. "But right now, it's the best answer we have."
Chevron, Point Molate's next door neighbor, had countered with its own bid to turn the former navy fuel station into open space, but some council members say it lacked important details. So the sale to the casino developer was approved.
The city does reap some additional benefits from the sale. A council member says Richmond is guaranteed at least $7 million dollars each year for 20 years, and the city could sure use the money. Budget cuts have locked the doors on branch libraries and community recreation centers, closed fire stations one to two days a week, put city workers on unemployment, and left roads in disrepair. Though desperate to raise money, council member Maria Viramontes voted no.
"I just think for Richmond, this is about vision -- how do you see this city in 20 years," she said. "For me, I just don't see gaming as the main way for us to do economic development."
The casino still faces many legal obstacles. The developer's back-up plan is to build housing along with the resort should gambling go bust.
Council approves casino plan
Hotel, slots may come to Point Molate
- Cecilia M. Vega, Wyatt Buchanan, Chronicle Staff Writers
Wednesday, November 10, 2004
Richmond's City Council agreed Tuesday to sell Point Molate to a casino developer who wants to build a resort with Las Vegas-style gambling on San Francisco Bay.
The 6-2 vote, with Mayor Irma Anderson abstaining, came after several hours of heated public debate. More than 200 people attended the meeting, spilling into the aisles and sitting on the floors of Richmond's City Council chambers. Many wore "thumbs up" buttons on their lapels to show their support for building the casino at Point Molate.
The council vote means the city can sell 412 acres of city-owned waterfront property for $50 million to Upstream Development of Emeryville and its partner, Harrah's, which plan to build a casino with 3,000 slot machines and a hotel resort on the former naval fuel depot. Council members Charles Belcher and Maria Viramontes voted against the sale.
Oil giant Chevron had offered a competing proposal to buy the land and convert it to open space, but council members criticized the plan, saying it was not specific enough.
The council had put off voting on the Point Molate sale three times. Before the vote Tuesday, council members lashed out at Chevron.
"I'm really disappointed that this deal is not better organized," Viramontes said. "A lot of people believed Chevron was going to put forward a proposal people could take seriously. You put us in a situation where we have to vote 'no.' "
The plan to sell Point Molate to a casino developer had been met with strong opposition from gambling opponents and environmentalists, who formed an unlikely alliance with the refinery giant, which offered to buy the land for $83 million.
Chevron said it would write a $50 million check to the city as early as Dec. 23 and pay another $25 million over 25 years along with millions for job training, construction and maintenance of the park and money for a land-use plan.
But council members scolded Chevron for not being specific about how much land it would set aside for open space and what kinds of jobs it would offer the city.
City officials have said a casino could bring as many as 7,500 new jobs to Richmond, along with $15 million to $20 million annually in taxes and other revenue.
Upstream has offered $20 million up front, and officials said they would write a $30 million promissory note to be paid over 15 years.
The vote does not guarantee Richmond will hear the clang of jackpots anytime soon. Upstream's plans to build a casino on behalf of the landless Guidiville Band of Pomo Indians face many legal and governmental hurdles, including the complex federal process of turning the land into an Indian reservation.
The deal could be made moot if the state Legislature approves a pending compact with the Lytton Band of Pomo Indians that would bar slot machines within a 35-mile radius of the tribe's Casino San Pablo.
"Point Molate provides a once-in-a-generation opportunity to stimulate the economic base of the city of Richmond," said Jim Levine, head of Upstream.
Chevron operates the Bay Area's largest refinery adjacent to Point Molate and opposes a casino there on grounds that it would threaten the refinery's security.
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Richmond OKs Point Molate casino project
Posted on Wed, Nov. 10, 2004
CONTRA COSTA TIMES
Drawn by the promise of thousands of jobs and millions of dollars in continuing cash, Richmond's City Council has agreed to sell 354 waterfront acres at Point Molate for a resort casino.
The 6-2 vote came at about 11:30 p.m. Tuesday. Councilwoman Maria Viramontes and Councilman Charles Belcher opposed the motion; Mayor Irma Anderson abstained.
None of the City Council members voiced any concern that the Indian casino may not win required federal and state approval, though the site falls well within the 35-mile exclusive gaming zone Gov. Arnold Schwarzenegger wants to give to an expanded Casino San Pablo.
If the casino can't move forward, developer Upstream Point Molate proposed a back-up plan that includes 800 housing units with a smaller hotel and resort center.
Upstream, with its partners Harrah's and the Guidiville Band of Pomo Indians, plans to build a 1,100-room hotel, Indian casino and entertainment venue on the closed Point Molate Naval Fuel Depot just north of the Richmond-San Rafael Bridge.
The developer will pay $1 million within 21 days, $20 million at the close of escrow and another $30 million over 15 years. Upstream has estimated its project will generate 3,000 onsite jobs, 3,600 offsite jobs and 1,000 construction jobs.
Though ChevronTexaco owns all the land surrounding Point Molate, the company didn't offer any development proposal when the city first solicited business ideas.
In recent months, the company offered the city $50 million for the land with the intention of using the site as a regional park that would provide a security buffer for the company's nearby refinery.
When the city rebuffed the initial offer, Chevron sued to stop a sale to Upstream.
Council members took turns Tuesday night grilling Chevron representatives on their plan, which seemed comparatively short on details.
Much of the council's ire was focused on the tardiness of Chevron's interest.
Unlike Upstream's proposal, Chevron promised immediate cash for the fiscally struggling city but no long-term revenue stream. Chevron planned to pay Richmond $5 million immediately for a jobs program and $50 million by Dec. 23.