Housing Development Gets Hearing Next Month

By Jorge Casuso

Nov. 20 -- After a delay that spurred a lawsuit against the City, the Planning Commission is expected next month to take up a proposed mixed-use project with 133 housing units in two buildings across from each other on Main Street.

Developer Howard Jacobs -- who claims the City's delay in processing an Environmental Impact Report for the project has cost him more than $1 million -- said he has not decided whether to pursue the lawsuit, which charges the City with violation of due process rights and the temporary taking of the property.

Filed earlier this month, the suit claims that planning staff has taken 20 months to process the EIR for the project, which is slated for the former Boulangerie site and the site across the street, exceeding the 12-month deadline called for by state law.

"We feel we've been damaged to the tune of seven figures," Jacobs said. "We believe we should have been before the planning commission last April."

The City Attorneys office counters that the delay is due to the large number of projects being processed by City staff, as well as the scope of the proposed development. The 12 months cited in the California Environmental Quality Act (CEQA) is a goal, not a legal deadline, officials said.

"Our interpretation is that it (state law) gives guidance to the City and that it's directory rather than mandatory," said Cara Silver, the staff attorney handling the case for the City. "It's a goal."

The project would be the largest housing development on Main Street, with a building on each side of the street. A four-story structure with 107 market-rate units covering 136,693 square feet is slated for the former Boulangerie site at 2012-2024 Main Street on the west side of the street, while a three-story building with 26 units covering 34,839 square feet is slated for the east side.

The larger building would have 288 subterranean parking spaces, the smaller one 87. Both structures include retail space on the ground floor facing the street.

"It fits all the development standards," said Chris Harding, a local land use attorney who represents Jacobs.

The lawsuit -- which claims the delay is jeopardizing the project and could force Jacobs to foreclose on his loan -- calls into question the City's planning process, which has been a source of frustration for many developers, some of whom have resorted to the courts.

"I think that the City's CEQA process is badly broken and needs to be reformed," Harding said. "It's getting worse, not better. It's a mess. The City claims they want to encourage housing. They've done the opposite."

Harding contends CEQA requires that the City complete an Environmental Impact Report for the project within one year after the application is deemed complete.

He claims that staff put off a routine City Council consent calendar item to hire a consultant for the EIR in April 2000 until the council approved a new fiscal budget in June. He said he was told the contract would be signed in July and that the project would go before the planning commission in February.

The contract, Harding said, was not signed until December. He said that he was then told that a hearing would be held in May or June of this year, then in October.

"We've been documenting our concerns since June," Harding said. "When they said, 'December, maybe,' we filed the lawsuit."

The suit -- which seeks an unspecified amount in damages -- claims that the delay has cost Jacobs $535,000 to extend escrow, as well as $82,000 per month in maintenance expenses, which include debt charges, property taxes and insurance.

Silver called Harding's account "totally inaccurate." She countered that the City Council approved the contract in July 2000, and that the consultant "immediately began working on the EIR." If there was a delay, it was in preparing a staff report for the council and placing it on the busy agenda.

"It took a while to get calendared on to the City Council agenda," Silver said. "That's unfortunate. It takes a while to prepare a staff report. Unfortunately the process does take some time."

The court has postponed Jacobs' lawsuit, which was originally scheduled for a hearing Nov. 27, until January.