Recommendation to Authorize the City Manager to Offer Commercial Tenants in City-Owned Properties a Loan Conversion and Forgiveness Assistance Program in Response to the COVID-19 Pandemic. (Community Development 858)
Thank you. Okay. And this is being presented by his presenting. Hi. And I'm going to ask for brevity. This was not a long staff report, and our council members read their materials and the public is always capable of going to the website and reading too. So, Councilmember Vella, did you have your hand up with that? No. I'm very sensitive to any motions. Okay. So, hi, Ms.. Mercado. Nice to see you. Hi. Good evening, Mayor and city council members. Evening. So and in the interest of brevity, I have two things that I'd like to talk to you about. So you guys sent us off several, several weeks ago to address the issue of being a landlord and how to how to help some of our tenants. At your last meeting, you gave us some direction. We had initially done a 60 day deferral of rent and establish a repayment process that began in October. At your last meeting, you extended it. For a 30. More days, for a 90 day, for a 90 day deferral. What I'm bringing this up because we resolve the deferral issue, but we're through meetings with our tenants. The tenants have asked you guys specifically said April, May, June, and our tenants have said we need it to be 90 days and we can figure out what what three months we would like to defer specifically so that they could be eligible for federal funding. The some of the federal funding requires that they be current on their rent. And so if we defer it, then they're not eligible. So I would just ask that you consider whatever motion you make to make to to change that to a 90 day deferral rather than the April, May, June. So you you resolve the issue of deferral of rent. But there was another portion that you wanted us to consider, which is the rent abatement. And there was lots of conversation about what a rent abatement program would look like. And you guys said staff manager. So I'm saying help us think about that and look at we looked at some white papers that were done by some real estate experts. We talked to property management companies in the Bay Area and down in Southern California. We tried to figure out what everybody was doing. And one of the things that we learned was one of the major pieces of advice and a couple of the white P papers were don't make decisions that for the long term, for a short term problem. And so we kind of were looking at what does that mean? And so one of the things that there were three different kinds of programs that were described in some of our research. One was the application of deposit, which would allow us to use security deposits with the agreement of the tenant to pay their rent . And then when the economy turned around or a tenant was better suited, they would replenish that security deposit fund so that we wouldn't be caught with a destroyed building and not be able to do anything at the end of the lease term. The other option was a program called Subletting Program, which essentially allowed us to well, we as landlords are tenants to sublet portions of their part of their building so that they could make their rent. And then the third program is the program that we're actually recommending tonight, which is a loan conversion program, which is the way we'll describe it as sort of an abatement for them. But you have some options, you have some flexibility. And the loan conversion program is rather than abating paths to rent, we agreed to convert the past to rent into a loan, a loan from the city to the tenant payable over time. And then the loan is evidenced by a promissory note that is cost defaulted with the lease. This we like this because it gives us a lot of flexibility in the promissory notes. There can be individually crafted to meet the needs of each of the tenants as well as we'll be able to say what the financial or the fiscal impact of each of these agreements would be, because they would be precise. The one of the things that we really liked about this program was that, let's say a tenant wanted to defer 24 months of rent. We could give them some benchmarks. And if they met these benchmarks, we could convert the loan into a grant. It's similar to the TPP program that if there were things that we'd like to see, like retention of employees or revise if it was a catalyst tenant or something like that, we could we could we could forgive all or a portion of it, however , we think would be best for the city and based on the individual financials of the tenant. So we like this program because it's flexible. And again, it can be our full abatement or it could be a partial abatement based on whatever benchmarks we would set up or that the council would be looking for. And finally, let me just talk about some of the alternatives to not doing this loan conversion program, and then you guys can have at it. Because what we're really looking for, the council is, if you like, this loan conversion program, what would be some of the benchmarks of some of the metrics that you'd be looking for for us to get from tenant job retention, you know, resiliency by a certain period of time, some things like that. But some of the alternatives would be that, okay, we do this program or we consider a rent reduction program, which was the thing that the broker talked about and you guys were remotely intrigued with last time, which is we we rebate the rent for a, let's say eight months and then the tenant has a period of time to catch up. So that way that there's cash flow to us and cash flow for the tenant. So that's an option. The other thing is we could allow the tenants to sublet. We could just do an active subletting program with our tenants. But that would also require that the sublet that sub tenants would be compatible with our zoning and permitting and it could be time, time consuming for the tenant, but it's something that we could do. And then the other thing is we could do the security deposit program. That may not be enough, because typically our security deposit is one month's rent. And then finally we could just stick with our deferral program and not offer any alternative to that and just do the 90 days and everybody has that. So I think that's all I'm going to talk about, because you guys have read the self-report and and I'm trying to be brief. Thank you. I appreciate a good report. Do we have any any questions about the clarifying questions about the staff report before we go to any vice mayor? Next. Quick question. So it seems like once you get direction, there's a whole program that's going to be set up with benchmarks and criteria. And if if we were to follow the staff report, there would be the the criteria for the 50% loan grant or whatever the direction was would come back. And what is the timeline on that? So I'm we are looking for you guys to tell us what kind of benchmarks you're looking for. We want to set this up as soon as possible because our deferral program ends in June. And I think you guys might be getting as many emails as we're getting from technically anxious about the expiration of that 90 days and and tenants who are who are saying the deferral program isn't good enough. So we would like to be exploring, negotiating with tenants right now to to get into the promissory term sheet, whatever you want to call it, to move this project along. And then at the same time, we would have some real time information. I know you're considering the budget tomorrow, but probably in the Q1 of next fiscal year, we should have a really good picture of what we've negotiated and what it means for our budget. Okay. Um, I have a couple of quick questions, actually, maybe just one. Can you explain what cross defaulted means? So the, um, the tenant agrees with the, uh, is that with the. Now it's about the loan conversion. So essentially it means that they default on their promissory note, they default on their lease so that both of the Oak Hill rated. Okay. So if they if they default on the promissory note, then they then they have to repay the loan. Well, I think we have the option of evicting them because. Okay. Because they've. Defaulted. Yes. On their rent. Got it. Okay. Okay. Okay. Do we have any were there any further clarifying questions? Okay. Do we have any public comment, Madam Clerk? We we have received one public comment for me to read in the record. And now I will ask any attendees who are interested should raise their hand and. It looks like there's one. And so we'll have that person go first and then I will read the other one. Very good. Jonathan. al-Khalifa. Yes, please. Mr. Barkley, that I don't see your whole name, but you're on. We're ready to hear from you. Yes, I'm his wife. Hello. Hi. Hi. I have a question about the sole proprietor we are. We have a business. My husband is the owner and we're working there as a family and for ten years. And I. Just want. To know if we're, like, included in the farm. Okay. So that actually is a question about the fund that we just and please don't take me on this one. That was from the last item. Now we're talking about something else about tenants who are who are tenants of city owned property, however. Starting is it tomorrow. Madam Clerk, the tape of this meeting will be available. Yes. All right. So you can catch up with that information that you missed. Thank you. And I made the next comment into the record. Okay. Jim Strelow, Alameda. I enjoyed the council's earlier discussions about considering a loan forgiveness assistance program because most commercial tenants were denied use of their rentals because of government restrictions. Some council members earlier said that it would show to other landlords that the city was setting the example for others to follow. I encourage you to discuss that program some more. Thank you. Thank you. Are there any further public comments? There are none. All right. So with that public comment is now closed for this item. All right. Counsel, how would we and I think as as Ms.. Mercado has indicated, she's looking for a direction from us on. Well, a first of all, do we want to go forward with I'm sorry, my temperamental iPad is freezing on me, but do we want to go forward with a loan conversion and forgiveness program? And if so, what are the benchmarks that we want to be considered? All right, I'm back. Or maybe not. Anyway, why? Okay, so we've. We've got the, um. Uh. The staff report and you know, direction about a staff has recommended a loan conversion approach because it offers the city flexibility. And I will throw out that I think flexibility is important these days and also individualized assistance. It's not one size fits all and our businesses are of very different natures and sizes and have different needs. Could be administered like a federal loan converted to a grant if the recipient complies with certain requirements. So council what's what are the benchmarks we want included? Councilmember De Soto has his hand up. Thank you. You know, I think like all of you, I did receive that email from the owner of Rockwall Winery and the fact that she had, uh, indicated that that she employs 81 people and she is facing dire situations. It seems as though what we are considering tonight could potentially assist her through this difficult period. So I think definitely job retention is certainly one of the key benchmarks that I would love to see. And I think what's unique about that venue is it does seem to be a catalyst. So that might be another benchmark. Um, so those are the two things that I'd like to see are one thing though that I would discourage is sub10 ending. And the reason why I'm going to specifically talk against Sub10 Inning is because what I have seen in the past is a lot a good number of facilities have leased out or subleased out areas to container cargoes. And I just I don't think that's that's in keeping of of kind of a type of built environment that we're, we're striving for. Um, and I think it's happened along, um, the winery RO Area Spirit's Alley, but I've seen it elsewhere too. So that's one reason why I'm going to speak against Sub10 anything, because I do think that there's an easy dollars to be made for leasing out to container trucks from coming from the Port of Oakland. Thank you. Thanks, Mr. De. So who's next? Cousin Rudy. And then you, Vice Mayor. Thank you. Yes. I want to go next. I understand, um, the vice mayor's question that this was going to come back to us. And then we'd have to vote on it. Is that the question? Oh, no, I thought it was the vice mayor asked. I think, what's the timeline? And once you get direction, what's the timeline? And I'd have to look back at my notes to Ms.. Mercado. She said, We we need to move quickly because the deferrals are ending in June. But, no, I don't think this is back to us, does it? It's not it's not our goal to bring this back to you. We want to implement the program and report back to you in the fall Q1 of next fiscal year about where we are, how many of these loan conversions that we've done and and give you a report and maybe we think about what are there any next steps? Are we have we satisfied what we need to do to get the tenant through that step? Okay. So I just, you know, I like the concept of converting deferred rent into a promissory note. Um, some of the things that concern me that we brought up when we had our subcommittee read out was just, there was no cap. And the way this looks now, it seems like there's no cap because a tenant could request rent deferral for up to 18 months. That's a year and a half. And the staff could determine that they want to convert that rent deferral into forgiveness or either 50% into a grant or a 100% forgiveness. And that was the whole thing that we wanted to at least I thought I wanted to avoid in the beginning was, you know, just a blank check and this looks like a blank check. So granted, there are, you know, some requests to have some criteria and metrics. But, you know, unless we come up with those today at 912 when we haven't even got to our regular agenda, then we're not going to have an opportunity to have a discussion on them again. So, I mean, I again, I like the idea and I'll hear my colleagues and get back into the, you know, the nuts and bolts of it, but that this just looks like a blank check to me. And that's exactly what I didn't want to happen in the first place. So but I do like the concept of a promissory note, you know, with an extended due date. Um, but, you know, given the size of potentially 18 months and given the fact that our staff could just either forgive half of it or all of it, you know, just leaves me queasy because I have no idea how much it's going to cost. Councilman Brody, may I, may I make a request of you? Councilman Brody I think so. What I really want to do is keep these special meeting items moving forward, because after all, this is all about COVID relief and the need is now, I think you really you hit the nail on the head, one of a few nails on the head. How about seeing if you can come up with what you think a reasonable period of time would be? I think there's a figure out there, the time period out there, I'll give you give you a moment to think of it. While I hear from two other colleagues who have their hand up. Let's hear from Councilmember Vela, then the vice mayor. Councilmember Vela. Thanks. So a couple of things. I am okay with the concept of the promissory note. But I also want to understand what the finances were pre-COVID. I am very wary of a business basically saying that they're going to be shut down if we don't just automatically forgive all of their rent. I'd like to know what the state of the business is and whether or not the business, because we are investing at that point and I would want to know that they're that they have an ability to continue to operate. I also think that employee retention needs to be part of that. And while a business may employ anyone, people or 100 people, how many of those individuals are employed full time with benefits here in Alameda? I won't say with benefits because I am I want to understand how many of the employees are benefited versus how many people there might just have their temporarily or hourly during high season. Other things that I would like to look at, I personally would be interested in capping it at three months. And I think, you know, if we're talking about anything beyond the three months, then I think that I would just have it. I'll get to next year. Okay. I would want it I would want it to come back to council to discuss why there is an extended need and what the plan is or the model. I think I'd also be interested in understanding what businesses in the criteria I'd want to look at or what businesses found a way to continue to operate in some form during the shutdown, and some of our businesses find new ways to operate. There was an entrepreneurial spirit that I think has kept some of our businesses afloat. Again, this is the last resort, not the not the bailout out where a city with a limited budget, we don't print our own money like the federal government. And, you know, these are these are policy choices. And if we if we give to one person, that means taking from something else. And so I want to be very cognizant and intentional with how we go about making these decisions. The other thing that I would want to know is the number. Well, I think we can give points for being a catalyst, but to me a catalyst is what I would want to define, what cattle, what we mean by that. And I think the other thing that I would want to look at is what's the what's the potential sales tax that we think that they can bring in? And I am for for some of these other businesses, or is their business model going to change under under the new kind of continued restrictions? Do they have a plan for continuing to operate? So those are those are my initial thoughts on this. But I am more drawn to the promissory note option because I think that that protects the city and and address some of our concerns that we expressed earlier on when we discussed this. Okay. And so can I hear from the city manager? Had his I saw you put your hand up. Yes, Mr. Levitt. I just had one question for Councilmember Vela. And then as a comment and the question for Councilmember Vela is, you said about capping at three months. We currently have the deferral for three months. Are you saying capping at an additional three months for the for this program? So that would be a possible total of six months? Yes. Okay. And then the second comment is, we had talked about whether we could get this to in front of you tonight, May 19th, or whether it would take more staff work to get to June 2nd. And then Debbie and then that in my conversation, I push for it to be May 19th, in part because I thought there might be more questions that came up and that way we could bring it back on June 2nd. And so that was part of the reason we brought it on May 19th is to give us some more time to try to deal with it on June 2nd. If you have more items that you wanted us to consider and bring back for your consideration. Well, and I'll continue just kind of but I'm not sure. Again, I'm I'm not wanting to rush things that are not well thought out. But I'm wondering if we can't give sufficient detailed instruction to staff and say this is what we want. Go forth and start doing it. Let's hear from Ms.. Mercado. What were you going to say? I wanted to just respond that one of the things that we read in the documents was that in order to qualify for this, we, the tenant, would have to provide us with an extensive list of extensive information. And i. I. I am. I. And the staff report which like current cash on hand payroll information list of creditors. And then one of the things that we would do that I didn't want to go through the whole is that one of the things that we would use to evaluate an applicant is the tenant would have to provide us with a resiliency plan, like how do you plan on digging yourself out of here? So a business continuation plan. And we also like the the grant program that you guys approved last council meeting and you're discussing again this council meeting. We think that there should be an employee like the tenant should have more than 30 employees to be eligible for this sort of program. So we want to make it a little bit different. And then we also think that they should demonstrate significant loss of income of 30%. And we want to be able to just make it a little bit more difficult to to have to to be eligible for this, because we want to we want to make sure that we're we're using this program strategically. Okay. Mark Potter and then the vice mayor who has a chance to be heard yet, I think as. Part of and just two, one, one approach the council might think about this evening about how to balance the desire to kind of get it right and cover all the points and keep things moving is that there are a lot of criteria that are contained in the staff report about how this program would be done. But there's a desire from the council maybe not to have it open ended. So one one potential approach is for the council to say, go forth and council, you're authorized to negotiate up to X amount of loan conversion or you're authorized to do something for X number of tenants for X number of month months. And so then we have we have parameters and we have a framework within which we can then apply the criteria that are contained in the staff report and the direction we hear tonight. And I think that may be a way to kind of strike that balance between getting it right and keeping it moving. Something to the council might want to. Okay. I guess I would wonder about how the council would come up with a particular amount of assistance, because I think, again, it would depend on the amount that the company, the business is paying. But hold that thought. Vice Mayor, you've had your hand up for a while now. Thank you. Um, so for me, I think one of the, one of the interesting things about these discussions is we've talked with the community and read about what our community, so many communities are going through, is that our employees are having their wages cut or losing their jobs and businesses are seeing significant reductions. It's it's struck me and it's actually something that I've heard from a number of Alameda businesses who do don't rent from the city. But it struck me that it's interesting that there is a perception that people who are in the business of renting land must be made whole at all times through this through this process. And so everybody is taking a haircut and taking cuts and struggling. And, you know, we can't tell commercial landlords what to do in terms of we don't have the authority, but I think we can show moral leadership. And I do think that there is something I you know, we get about $1,000,000 a month in rent. And I think that we need to be thinking a little bit about the fact that we're collecting rent from people who are not legally allowed to use their buildings. And to me, that's the threshold I think we should be using, is that people who are not allowed to use their buildings because they were not legally allowed due the public health order, the length of time for for for the for for for a loan program would be based on how long that their business was impacted by the public health plus one month so that they have a chance to get in and start up. I think that we know that Councilmember De Saag mentioned job retention. I think if somebody can show that they retain 75% of their jobs over a year, we should look at 50% just taking 50% now and converting it. That would be our metric to to grants a year after. And then they might have an additional couple of months to pay the other 50% of rent that they were due. I struggle. I am struggling with the idea that our goal is to make sure that we're having people pay us for for land and buildings that they're not they're not allowed to even be in and use. Right now, I don't think every business that we rent to is going to qualify for this. We have some who have changed their business models or who are open and whatever else. You know, I think we could go to the city manager's recommendation. We could give some direction and some numbers could be come back. In terms of what we think we're based on the deferral program and whatnot, what we think that this might impact, we obviously don't know when things are going to be able to open up, but we do know that certain businesses are going to start opening up in the next two, four, six weeks. So this isn't an 18 month rent deferral program or anything, as it was, I think pointed out in the in the staff report as a potential way forward. So to me, I think we can I think we can I think we can craft something. I don't want the council being involved in having to make every single decision on this. I think that's getting us too deep. And I also want to be careful that our criteria is not us deciding who is important or who makes enough money. I think, you know, business communities and business ecosystems are made up of a lot of different sized businesses and they all have important places within that. And I don't want to I just government has never shown itself to be really good picture of winners and losers in these things. And so I think we should find the find the problem we're trying to solve, which is help people through this time when they are currently being asked to pay for rent, that for something that they can't use and then figure out a way to to support them coming out of that and then hopefully collecting a little bit of the money because there is rent, there is there is wear and tear on that building over the time that that that we should be collecting. So those are those are my thoughts. I don't know. I'll look forward to hearing other people have. But. Councilmember Odie, who moved me. Thank you. So I took your assignment. Thank you. Thank you. And heard my colleague. I agree with the vice mayor. I mean, when you if you're shut down, I think we should be more lenient for, you know, any type of abatement in those those situations. I mean, that that's just a fact. But if you're, you know, get up and running on July 1st and you request, you know, a nine month rate rent abatement or an 18 month rent abatement, you know, I'm not sure if that meets meets those values. I like the idea of Avella. You know, let's start with another three months. People could ask for up to three months. And I also think that, you know, we can extend these payments out. There was the suggestion was the total deferred rent is due in 18 months. But if you have a ten year lease, you know, why not let someone spread out those payments over the last ten years of that lease or whatever turns out to be nine and a half years? Um, there's one other item, and I forgot what it was. Oh, I mean, I still think having a cap, like, if we, if, if this number gets to be 300,000 and maybe this, it gets, the council gets pulled back in and says, you know, we're we already spent 300,000. Do you still want us to pursue this? Because, again, I'm really leery about the blank check and really leery about the threatening letters. I'm really leery about, you know, the parade of supporters coming to council. Um, so I just want to make sure that we're fair to everybody, but to the vice mayor suggestion. Yeah. I mean, let's be as leaning as we can when. When they're shut down. Thank you. Council every day. So, yeah. I'm here to speak in favor of going beyond three months, largely because if you watched, for example, 60 Minutes this past Sunday, you had the chairman of the Fed talk about recovery, probably not really happening until the end of 2021. And even if we shelter in place, begins to lighten up soon, if not and within three months, I think everything that you hear about in the business sections of newspapers or or if you watch CNBC, everything you hear about is that demand is still going to be tepid. So my sense is that that maybe it's not 18 months, but I don't think it's three months. So I think we need to go a little beyond that. Thank you, Count. Counselor every day. So you understood that that's an additional three months to the six months we've already mentioned the three months we've already provided. Yeah. No, I mean an. Yeah, no, I understand that. Is there any reason you wouldn't think that we could go with the additional three months now and revisit it if we're not seeing businesses open out there? And I watch 60 Minutes the other night, too, and that Jerome Powell, the chair of the Fed, is very eloquent and he said we're going to um economy will recover when we get a hold of will we get coronavirus under control. And I think he was speaking to nationwide. I mean, we are the most populous state. But I'd say that here in the Bay Area, we we got ahead of a lot of things. And I think our recovery is going to come back sooner than some places. But again, to the point Nanette made in the beginning, the advice given was don't make long term decisions for short term problems. Right now, we don't quite know the magnitude and duration, but I think we could come up with a reasonable figure now and then certainly come back and revisit it. My thought, I hear that. Sounds like. Nodding heads and I think misspeak kind of. Were you going to add something and then. Councilmember No. Okay. Um, we ready to make a motion in some direction? Councilmember Vella. Oh, you're muted, Councilmember Vela. You're muted. I did want some clarity from my colleagues in terms of if they had a suggestion for an overall cap, because I do think that we need to have stuff come back to us that exceeds a certain amount. And then the other thing was, I think while some businesses were were closed in that, like, for instance, you can operate a tasting room, you could. There's other portions of the business where you could still bottle. You have product that's not necessarily spoiling. So I think, you know, again, I like the aspect of this bacardi's point of looking at the resiliency and looking at what that different businesses took to try to to get out during during the closure, because I think that that speaks to trade it to an attempt to get some recovery. I am wary of or I did have a question of if a business owner has multiple properties that they're renting and and a combined set of employees, the total number of employees that we're requiring that a business owner have. How we came up with that number. In order to get the qualify for the relief. They wanted to see at least 30 employees, Mr. Conner. So it was just looking at what other other landlords were doing. That's where we came up with that number. But I would say that we have I don't think we have too many tenants that have multiple. I mean, we have a couple of tenants that have a couple of buildings, but we don't have tenants spread across multiple properties very much. I mean, that's a that would be an unusual and for an example, I would say like Astra has Building 360 and 397, but there are very few tenants that have more than one property. Okay. I mean, I would be inclined to to lower it to 25 since that's what we did for our grant to see 25 employees. So we're looking for a grant. We did more than 25. I understand that. I understand that. But because our grants were up to 25, why not lower it to say people with more than 25 that way? There is not this section of businesses with five people that aren't are aren't qualifying, that are tenants and. And can I just make a clarifying or asking clarifying question? So right now we're only talking about businesses that are tenants where the city is the landlord. The grant program up until now has been for small businesses. So I it's not that I mean, I guess I guess I'll make the point. There was a fund founded to point small businesses to apply. Okay. So Councilmember Vallas agreeing that there is that delta that we're leaving people out. Okay. All right. And Councilmember Vela, did you have or Councilmember Odie, because you both raised this, do you have a, um, a cap, an idea of what cap and the cap is, the amount of how much rent the city is giving up? Is is the cap you're looking at? Did you have an idea of what that would you know, what would would trigger you wanted to have the the program or have a report that brought back. I'm worried about. Councilmember Odie, I'm sorry. I'm worried about the amount that might be abated versus, you know, the amount that might be deferred. Um, so, I mean, when we did the subcommittee we talked about 300,000. Mhm. I mean it'd be good to get a report back and I think like Ms.. Mercado's nodding her head so that might be that she's in agreement with. That's a reasonable figure. Yeah. And Councilmember, I don't know, I think you said this, Mayor. Um, you know, if this, if we need to do more in three months, we can do more. Right. So, I mean, I totally agree with that. I'm not saying I don't I'm not trying to be miserly or anything, but, you know, I don't want to give this huge blank check and then find out maybe it was not necessary. But if we need to give it and every three months we come back and we need to give it, okay, that's a different story. We can do that. That sounds good. Okay. Are there any groups that are under 25 that might might qualify for this? Any. Any you know, there's like a mom and pop and there are a couple of mom and pop shops out there. I don't know. Um, well, so we do. I mean, there's, we have the Park Street sellers. Uh, yeah. And we have like the. Oh, yes, yes. Just Alameda point. And you're right. Just Alameda, right. If you have to have those, those types of businesses. We also have, um, you know, probably, probably many of the tenants, um, like Pacific Pinball. They probably don't have that many employees, employer employees. Um, so, I mean, I think it, uh, I think they're, I think in over, over 25, it's, it's a smaller group. I think you're going to hit your sales rounds, rounds, Astros. You will hit I mean, I don't know about Rockwall, she said 81, but I think a lot of those might be part time employees. As Councilmember Vela said, I think the antique fair might have a lot of part time employees. I mean, I don't think that they might hit that 25 threshold. So, um, I, I think the 25 is, it's, it's, it's a reach for many of our tenants. So because I would like maybe the 25 is just for forgiveness, but, or a conversion, but I'd like to see as many people eligible as possible, even if they were, you know, ten employees or five employees. So the other thing I just want I mean, I want to be clear about what we're proposing, because remember, remember a lot of our research, not very many landlords are offering rent abatements. So this is sort of I mean, in fact, I, I had read that practically no one is offering rent abatement. So I think we're being very, you know, patterning our program, patterning our program after the federal PGP, where we're setting the pace by saying we're going to loan you this money and potentially you will be forgiven. And so I think I just want to make sure we're clear. We were over 25 are only 25 were offering abatement. Just straight out the gate. Can you clarify that, please? Well, I. Well, I do think that that's that's a good point that we, um. Just because we can because we're the landlords doesn't mean we should do something that other landlords aren't doing. And it's. And it isn't because we're being cheap. It just might be that we're being prudent, that we want to be in a position to be able to do the things with that revenue that, that the, um, that the our made a point, um, you know, the revenues are paying for because remember that, that the revenues made there are used out there. But I think we can help people through some hard times. Um, but I think we should be more judicious with the criteria about who actually gets their rent abated along the federal program. Paying at the back end of your lease. I can see that things are going to get better for most, but we've got to apply these criteria. Um, and I just think that there's a lot of things we'd like to do, but already we're seeing less revenue and that's going to start, meaning we're unable to do some of the things we need to do to keep these areas viable places for people to come when the customers can come back. So I'd like to see us craft something that really relies heavily on deferral. You know, we can lengthen the amount of time, but abatement under really specialized circumstances. Anybody want to try and craft a motion? Yeah. Vice Mayor, not slate. I know I don't want to craft a motion because I'm not sure I'm I'm so I'm definitely on that team abatement. You know, I appreciate Mr. McConaghy comment. I think just because everybody is not doing the right thing doesn't mean we shouldn't do the right thing. And I think we spend a lot of time talking about tenant landlord relationships. And I think this is one where we're where we need to show leadership and even use that leadership to encourage others to do so. My question is, we have the 90 day deferral as it is. So if we were to say let's say I keep hearing about three months, that's how how does how does the the the 90 day deferral and the loan conversion, does that become a six month loan conversion program? And how did how did the two things we have 90 days and deferral and then we're adding another 90 days essentially in loan conversion are those two separate things so they still have to pay the 90 days that was deferred under the original agreement. And then this is a new. Set what the proposal is. Can you clarify that, Mr. McKenna? I. When you're unmuted. Yes. Yes. So. Okay. I would say I'm not sure if I'm clarifying or if I'm giving you my opinion, but I would say that the all of it gets mixed in together. And so if after six months, we you know, the tenant has proven that they're I mean, that they've overcome, I would say, and and met some of the benchmarks that you've set up like employment. And I think that we would potentially offer a 50% abatement and that they would just be stuck. They would be not stuck. They wouldn't be subject to the original deferral program that we put together. Okay. Okay. Thank you for that clarification. And and I'm going to call did you finish your comments, Vice Mayor? Well, I had some comments when I saw the city manager's hand go up. Yes. I wasn't going to let him. I thought that was related to the questions. I think he might want to talk about it. And I just want to say something and maybe this is just semantics. I would say we're all here to do the right thing. And so we may not agree with each other, but a difference of opinion does not mean that someone is supporting a position that is the wrong thing. It is nice to be more generous. I would say, you know, there's a lot of considerations, but it's, you know, we're all right. We're all trying to do the right thing in these difficult times. And I would never say that I didn't suggest otherwise. I said it might be a matter of semantics and sometimes it's a matter of perception. City Manager. Yes. Mayor Ashcraft and City Council. I would agree with what Nat ended up saying at the end, and that is that I would see the 3 minutes I've envisioned that the three months would be combined with the first three months. Or. The other action that you requested, where if they didn't do three months from April through June, that they could add another month at some point. But if you you added this three months for the loan, that could be wrapped into a loan that we would probably try to wrap all six months into a loan, or else it would make it unfeasible for for the tenant to be able to to manage that loan at that point. And that's my kind of. And your. Comments. I really did like the vice mayor said about her, that making the program and the length of time the building was unusable or that they were not open plus one month. I thought that was pretty clever. And then I do like the three. I like having three months or $300,000 being the cap and having the council say whichever is greater or whichever is lower. I mean, I think that gives us some guidelines that we can work with in administering a program. So those are just my two comments. Okay. How does that sound, counsel? So. So we've got the. I'm sorry. I believe I had the floor. Sorry. I was looking away, taking notes. That's okay. Yes. Thank you. So thank you, Councilmember Odie, for directing my attention. Council vice mayor. It's down there. Not on the. The. I. Worried about $300,000. Our total rent is $1,000,000 a month. We already if we were to go with plus one month we're looking at four months and whatnot and half if half of that is abated. We're going to hit $300,000 with like two companies or three companies possibly depending on which ones we do it. So I just want to I just want to make sure that we don't set a cap that has us has staff coming back. And the other thing is, I want to be. Whatever. However, we move forward tonight, I want to be sure that we are careful, that we are not. I don't want to approve seven businesses because they were the first seven in the door. And then it turns out they hit the cap and now we're coming back and asking for more. So figuring out how we're going to have that cap conversation before people are told they have received this, I think is going to be an important part of this. But like I said, I as I'm further on the abatement side of this, I'll let my other colleagues decide how they like to move forward. And I would just ask the clarifying question. So when it comes to the application period, I mean, you're you're not contemplating first come, first serve, I would imagine I would think you're having an application period. And once all those applications are in, then the hard part comes comes that you need to look at everything and who meets the criteria. And I'm sure there's some sort of sequencing or, you know, ordering who's scoring highest or what have you. And then you'll know, I guess, how quickly you'd come to the cap. Is that is that a fair assessment of when you make. Yeah. Yeah. So I was thinking that and I wasn't thinking $300,000 total for the program. I was thinking as a tenant, I got that and there's very few tenants who pay $50,000 a month. That's I mean, you could get a long period, you could get a lot of room per tenant there. But I also think that it's not first come, first serve. I think each of these agreements will have to be negotiated. And there's a lot of paperwork that we're going to ask these tenants to provide us to make their case. And if they can't make their case, then they're I mean, we could offer them probably a more deferral, two months more deferral, but not necessarily abatement. I think they have to prove up because as you guys all just said, that, you know, this is money that we're going to we're going to be using for development and to dig ourselves out of having this dilapidated property. So I think, um, I think we would be looking at these applications pretty closely and with a lot of scrutiny. Thank you for the clarification. I'm an economist, Jodie. I say use your double take, but I mean, I did get that. I mean, we read these lease leases, those are high monthly rent. So that's what I mean about it. It is lovely to to be generous, but it has its cost. Councilmember Brody. Thank you, Madam Mayor. 300,000 person per tenant. I mean, that is basically a blank check for almost every tenant. I mean, I just go down the list, you know, 27,000, 30,000, 38, 2013, 12 nine two, two, three, two, five, four three. I mean, those are just the the least the monthly leases. So I don't know. Would you. Councilman Brody, may I ask, would you have a capped amount for those paying rent within a certain category? Because I, I can see your point that this would be too generous for those. And I, when we were on the subcommittee and probably has been provided to the rest of the council and this kind of gave us that list of the rent, the monthly rent payments. But what would you think of having like a small, medium and large cap somewhere? I want to see what we can do without. I think the principle you're you're advancing is a is a good sound one. But is there a way that we can give staff direction without being so much in the weeds, you know, the parameters? So here's kind of what I would like to think based on my colleague's comments. If you are shut down and locked out. I mean, we said it. We should abate your rent. For the first three months or whatever until you're when you're locked out for the second three months, we should be as generous as we can with deferrals and this loan conversion. And then when staff reaches 300,000 in proposed abatements, then they come back to us. In proposed abatements statement tenant. Not deferrals abatements. No abatements but that. But even for a smaller tenant you would spend it cumulatively. Cumulatively in total total. Cumulative well which would give tenants paying a lower rent more months to have it. But the city manager has his hands up. He's going to clear this all up so we can move forward. Aren't you. Know. I'm not sure about that. I was just I was clarifying that I think Councilmember Audi was saying 300,000 among all the tenants is where he's talking about. So statements, though, not deferrals on abatements. Right. I think I think there's a little bit of a split on council. Again, I'll just recommend that we take your comments and we come back with two or three choices in June. And then I think we can synthesize it and be able to bring it back and you can have a good program moving forward. Okay. Let's hear from Councilmember Vella. So I would want to know what this means to the capital improvement projects that we have planned out at Alameda Point on our other properties. Because, again, I think that there there's a cost to this. And while I think that, you know, we need to I also think there's very few businesses that have truly been locked out to a point of being able to undo and unable to do absolutely anything. I think that there was certainly a period of time that there may have been a stall and they'd have to reconfigure how they're operating. And there are some businesses that that business completely probably dried up for them. But I don't know that that necessarily means that they were or were locked out. And I think so. I want to be conscientious of that. And I want to go back to what the budget analysis is and what gets delayed, because I also don't want to be in a position where and I've been at meetings where we've had our tenants come forward and register different complaints about infrastructure out there where, you know, where were then causing more harm to other. Businesses out there because. We're not investing in certain infrastructure things as a result of giving these abatements, especially if the business is not going to be able to be sustainable in the long term. And we're just delaying the inevitable. Good points and I do think we probably have a couple of businesses. I'm just thinking of our, um, some brewpubs that, that, that don't produce the product that they could be selling and rely on people coming in. But you're right that, that is probably more the in the minority because even the winery that was mentioned, they're still selling their wine, they still have their membership. And, you know, you go out and pick up your bottles of wine per month. Um, but so, uh, councilmember decide it just quickly. I think one way to get at the issue of not being a blank check for everybody, all those, you know, 20, $20,000 a month rent one way to not get it be a blank check to to a lot of tenants out of Alameda point or whatever properties that we own is again goes back to the question of having benchmarks for example jobs howsoever will be defined it certainly if we create a threshold that that that will deal with that another benchmark going back again is that the notion of catalyst and when I read the staff report by Catalyst, I think we're talking about basically for the most part, foot traffic generating or or a type of business that has positive collateral effects with regard to businesses immediately surrounding it. So I think that will be one way to kind of account for, you know, an attempt to not be a blank check for everybody, as Councilmember Odie is rightly, rightly concerned about. Thanks. So Council, shall we take the city manager's suggestion and submit our comments to staff for them to return in June? Or does someone feel that we're ready to actually craft a motion and move forward? I couldn't wait to June. Um, I, I, um. I think we can certainly wait till June. I want to make sure that we're helping folks who need help and not keeping them waiting too long. And we also don't want to defer too many things to June because that will come back to haunt us in its own way. Councilmember Odie, your thoughts? I was going to make a motion. Not a completely solve the problem motion, but one to give staff the authority to. I think this was requested early that for the three month abatement or three month deferral, it could be any three months. So let them have that flexibility and then also give staff the discretion to give an additional three months deferral per tenant that would be converted into a promissory note loan type arrangement. And then they could come back and, you know, further discussion on potential abatement, because I think there were some good points here that were made. But, you know, it's going to be tough for me to, like, say goodbye to money. So that would be kind of my suggestion. Okay. So to give it authority to the staff to let is take any three months off as the deferral of the the original. April, May, June. Right. Mm. Some may want to play with that. Okay. So then, for instance, if you paid April, May, June, you can get an automatic July, August, September deferral. Right. Mm. Right. Okay. Everyone should have the opportunity for those three months and then give them the discretion to defer and convert into a, uh, a promissory note up to an additional three months. And then that, that should at least keep people, you know, less worried that from now until, what, the end of September, right? Yeah. Um, and, you know, I, I, I like, I think that has a lot of merit because, again, with more time, we get a clearer picture of where, where the reopening is going, where the economy's going. Our our revenues and our, our losses. And, uh, so, I, I, I think I, I like that. Um. And then we can, I can. I'm sorry. And I mean to cut you off. And then I think it was the other way around. Sorry. You can continue the discussion on abatement, although I am inclined to do as John mentioned, you know, if you if your doors are closed, you know, I'm super sympathetic to that. Without having it like a cap. I'm okay. I see the vice mayor his hand up. Yes. Does your motion include staff coming back in June with the crew? With the proposed criteria for discussion, for for the the potential, what we're calling it conversion to grant for 50%. June or July. You know, whenever they feel they can, they can do that. Yeah. Okay. I would be happy to second that motion then. Okay. And I'm just going to say, I think the one thing everybody needs is some certainty so that, you know, some folks are going to need to know if they have certainty of at least if we perform certain metrics, we can do that. So with the understanding that staff is doing an incredible, incredible amount of work and an incredible job doing that work. You know, the sooner the better with no date. Okay. And I'm so when and you want this to come back to us in June or give us a few months to play out. Would be June or July. I mean, I think I saw Miss Potter and Mr. Levitt, I guess in order of hierarchy city manager. First I was just asking before you vote, could you actually restate the motion so that I understand it exactly what what the motion is? Sure. Ed, can la read it? Well, I think. I can try to read it. I think it was you were giving staff three months deferral for any three months that they could do the staff recommendation of any three months. And then you were giving additional three months deferral with the tenants, with the promissory note involved, and then bringing back the abatement issue. And then the clarification was the criteria for the conversion to 50 cent 50% grant and then it would be in June or July and it would be better. Or 100%, you know. I'm not that far off the table for me either, because it's like I said, I think if they're if they've been locked down and locked out, you know, I think. I think. I think Councilman, morality, if we're bringing it back for discussion that we don't have to narrow the parameters of the percentages are because we're bringing it back. Okay. So we've had a motion. Do we have a second? I seconded it. Oh, you did already? Um, you're too late to send it, Mr. Love it now. Yes, Mr. Low. You have to unmute the. I just had one more question. So. So it. I'm still not clear. Does the motion include abatement plus three abatement for while they're closed down? Plus three. Plus three. Is that what it includes? Because that's the way it sounds to me. Not high. Well, you clarify. Maker of the motion. I don't think we're getting to abatement at this. Okay. So no abatement. Well, let's hear from Mr. Odie. Well, I thought we'd defer that, but it was okay. That was my understanding. The April, May, June deferral Part A is to give those that may not want April, May, June, the option to take those and any other three months and just leave it open because leave it open. And then that we would authorize you on a case by case basis to grant additional deferrals of up to another three months , that people ask them that those were converted to the promissory note. And then we would have the discussion on abatement or or a 50% conversion into grants. You know, when you thought it was appropriate in June or July. Okay. Okay. Okay. Miss Mercado. You're muted, this kind of. Yes. So I just have a clarifying question. Or like I do, we have some leeway and flexibility and the repayment terms. Because, remember, you had mentioned before that it could go over the remainder term of the lease. However, because one of the issues that you will hear, you probably have heard is that, you know, we are deferring these three months, but then they have to pay that 1/12 of it over a well over a 12 month period of time. So do you want to give us some flexibility in negotiating the repayment terms? I'm totally I mean, not as my colleagues, I'm totally open to, you know, having a promissory note go out to the end of the lease. Well. And if I could add, I think this is where these solutions can be individualized based on a particular businesses need and circumstances. And I think that staff is in the best position to know what those might be and to carry on those negotiations. So I would certainly support giving them the flexibility to do that. I think they understand the spirit in which we're proceeding. Vice Mayor Knox White. So I would agree with that. I just want to be careful that we're not also using you know, again, we're not picking companies that we think are good companies as opposed to using their accounting, etc., and existing rent. Right. I even think the catalyst issue is very more nebulous and than we would like it to be. That's why you say end of the lease, because. You know. I agree. I like end of the losers. Yeah. Okay. If there are no further clarifying questions, we have a motion. We have a second. We have a roll call. Vote, please. Councilmember de SAG. Yes. Not quite. Yes. Odie. Yes. Yes. Mayor. As the Ashcroft. Yes. Carries by five eyes. Hey. It's for counsel. And you know what, people? It is 10:00. Goodness gracious. We we haven't gotten too far into our agenda. But let's take a quick ten minute break. Is there a slow ten minute break? Vice Mayor? Not quite. Thank thank you. I appreciate the break. I did want to say, given that we have a lot of people looking and we have a lot going on, I'm wondering if we wanted to make a motion did to hear the rest of the agenda so that people know that they're not going to be sticking around for another 90 minutes only to find out their agenda is not coming up. I, I personally would be willing to commit to that, but. I would be a little more judicious about that because it's 10:00 and I would say I would be supportive of a motion that certainly any item for which we have public speakers we will hear. Um, and I think there are some things on the regular agenda that need to move forward. Um, I think like the BIA votes, but I'm not sure that we'll get all the way down to the end of the agenda because I think we still have to take a a motion as we get closer to 11:00. But certainly we're going to finish this special meeting and then launch into the regular meeting. Okay. Okay. Okay. So ten minute break. It's. What time is it? It's 1002. Okay. It's ten or two. We are starting up at 1015. I know that's a little bit longer, but just give you time to get into place. Okay. See you at 1015. Thanks, everybody. And you know, before you you just remind me, Laura, which are we going to hear first on this next when the commercial or the. I guess council can decide what they want to do. Yeah, I think the staff is going to give the presentation in two parts. So I think they'll they'll address. Oh yes. Oh I can I can answer that. Monama. This is Eric. I can answer that. Ma'am. Can you hear me? Yes. Can you. Hear me? Yeah, I can hear you. Yes. There you go. Can you hear me? Yes. Okay. So I can answer that. You hear. Us? Yeah, we've. I couldn't for a second, so I guess. Okay. So I've asked staff to the guy who's going to give the presentation is going to do first the commercial and then that. And then after you're done with that part, then Councilman Brody can recuse himself and Councilmember De Soto. And then. And then he'll do the residential. Okay. That sounds great. Okay. We're ready to go live. Okay. Yes, Jim. And then. We. We we have to be out of the picture during the public comment, too. Right. Um. I knew yourself. Mr. City attorney. Even even. And Matt and yourself even admit. Yes. Speaker, are you there? Yes. All right. I see, cause there's no way to segregate public comments. Clearly, my recommendation will be that the two councilmembers step off the dais or the camera for the entirety of the public comment period. You can do that. Okay. Thank you. I see. All right. Hey, wake up, Drew. I know. Come on, people. Okay. And we, um. And before we get started, I just want to say we don't need a long winded staff report. We've read our materials, the public had access to them. So give us the cliff notes. Give us the high points. It's 1020. Okay, let's do this thing. Good evening, Mr. Mayor. This is Scott. Looks from city engineer and members of the City Council. First, can you all hear me? Yes. In fact, I'm just going to let the public know. Thank you for indulging the council. We needed to take a little break there. And so with that, we are now moving into item camp to D. And I'm going to ask the city clerk, Ms.. Weisinger, if she would introduce that item for us. Recommendation to endorse implementation of Temporary Street Reconfigurations to provide space for social distancing in response to the COVID 19 emergency. Thank you. And so, Mr. Wickstrom, our city engineer, is on the line. So does that mean you are presenting this item or is it a joint venture or how are you doing this? I am going to lead the presentation and both Andrew and Rochelle are available. Should there be questions that come up? Great. That sounds good. Okay, Mr.. Wikström. Thank you. And I would like to thank, obviously, Rochelle and Andrew for helping to basically write the staff report, which is very complete and thorough. So in the interest of time, as the mayor suggested, I will be relatively brief in my comments.