Response to City Council Referral Regarding a Possible Wetlands Mitigation Bank at Alameda Point. (Base Reuse 819099) [Continued from March 15, 2016]
And so what the regulate the regulatory system in the Bay Area has allowed is that essentially if you impact mitigation or you impact wetlands, you have to essentially mitigate your impact. And so that that overall that there is kind of a no net new net no net loss of wetlands along the in the coastal areas and in California. And in order to allow that, what has sprung up is essentially the ability to essentially it's created a market for areas where you can mitigate wetlands. And there are essentially developers that have been able to create wetlands mitigation. Banks were able to essentially purchase the right to impact wetlands in one location by mitigating, creating and enhancing or improving a wetland in another location. And there are all kinds of very detailed rules about how this occurs and a regulatory process that governs that. So usually what happens is a property owner. So for instance, the city of Alameda, property owner of land out at Alameda Point could essentially partner with a wetlands mitigation developer and create a bank on its property to essentially receive mitigation credits from developers throughout the Bay Area that are impacting coastal wetlands. And essentially they get paid to do that. And essentially what it does is from the proceeds of that, that banking you're able to create open space and wetlands on land. And so we did based on a referral from Councilmember Ody, we did evaluate this as a possibility at Alameda Point. So as a really as a means of creating open space and paid for through a funding source. So money that is, you know, not coming from the general fund, not coming from the base reuse department. But it also has a benefit of creating not only the the potential money for the creation of open space, but the maintenance cost. There's an endowment that's part of it that creates essentially has to spin off sufficient funds to essentially maintain those wetlands. And so definitely something that we've been talking about thinking about for a long time and a point and and and really needed to delve into the details to understand whether or not we thought it was feasible . And so that is what we did. We consulted with our kind of our environmental consultant with a wetlands mitigation bank developer, was consultants that specialize in helping to create these with legal counsel on some of the issues related to state lands. Really try to delve in and do an analysis as to how feasible is this at Alameda Point. So there were two locations that are essentially zoned open space in our zoning that we looked at. One is deep paved park down here on the western edge of the seaplane lagoon. The other is this Northwest Territories, and I'll explain why these are different colors. But you can see in the black outline about 170 acres, I believe, or 170 acres total, 150 acre eight acres here. And we looked at these two locations as possible areas for wetlands mitigation bank. And what we did find was that it is just a 3 to 5 year process with a number of uncertainties. And, you know, we're we are glutton for punishment and base reuse. So we are familiar with complicated processes and things that take a long time. And and so, you know, that's we understand that. And there are but I want to walk through a little bit what those would be. So there's kind of five things that we need to be thinking of in terms of analyzing those five considerations. And when we did our analysis that we thought were important, the first is you can't create wetlands on land that is contaminated or that would create essentially, you know, a hazard or potential for wildlife or other things. And so because of that, there were land that were eliminated at the base out on here, out on this corner . So we essentially had to subtract that land from the ability to to be a wetland wetlands area. The other is that they don't let you count public access as part of the wetlands mitigation, because the whole point is that this is essentially mitigating passive, very passive wetlands that exist today. And if there's public access, you can't. Essentially the square footage of public access. And so their staff's analysis of this, we felt that that, too, eliminated some areas from feasibility from our opinion, especially this Deep Pave Park, which we you look at the precise plan for town center waterfront area. Although it is intended to be more passive open space. It had significant trails going through here and intended to be a more highly used and active public open space area. And so essentially we felt this was also a very small area and makes you need some efficiencies and scales to really make this work. So essentially eliminating the option, we believe from our opinion of use of deep park, also wetlands construction, we learned a little about wetlands construction and that you you can only really count the areas that are wetlands. And the way that you construct wetlands, which we would essentially be doing here, is you can't count some of the upper layers. There's kind of this construction where it kind of comes down in tears. And there are certain upper tiers that you can't count that are essentially aren't are wetlands because you need the stagnant, the stagnation of the water and the still water to create the habitat for certain vegetation and aquatic habitat. And so you can only count the part that is that that creates that that's still water. And so you can't count those upper tiers. So that also eliminates land. There's a very detailed regulatory process, which is very complicated. It's not something, you know, I know from doing other permits through the Army Corps and the regulatory process, they're extremely impacted. Now with the economy, there's tons of applications. We're having a hard time. You know, even moving things through that process was something, you know, that's really improving water quality and other things. And there's the we understand from interviews is that that our local Army Corps isn't necessary. This isn't their priority. In other words, is it something that required to process and regulate? Sure. But because they see it as, you know, essentially allow helping to allow developers mitigate impacts, that doesn't mean they won't process the application, but it just means it's a little harder to move that process through a little faster. So it is very time consuming and onerous regulatory process. The last issue that we looked at is that the land out of the Northwest Territories is, once it's all conveyed from the Navy, is subject to Tidelands Trust. So as a state, essentially we are the city acts as a trustee on behalf of the state of California, which means we're all subject to all the restrictions that that land comes with. And that creates some problems because typically the regulators want to put conservation easements. They're saying to, hey, if you develop are going to get credit for impacting or eliminating a wetland. We don't want there to be this kind of time expiration on the mitigation that you created. So it. But the State Lands Commission typically does not like to put permanent restrictions on their land. It doesn't mean it's not possible. There's ways either through legislation, possibly through a memorandum of understanding with state lands and the regulators, that that could potentially get worked out. But it's just another consideration. And I think so once you take all that into consideration, really, we think the value that could come from this would be probably about when you pay the developer because they would essentially be taking all the risk. I mean, that's our assumption is that they would they would the developer would be taking all the risk, funding all the money up front. We wouldn't be doing that and that they would be taking significant amount of the proceeds to essentially pay the pay themselves back for constructing the open space and then essentially paying themselves a premium risk premium for having taken all that risk. So we we estimate in about $9 million after all of those reductions are made that could be netted from this. So I think in staff's, we think this is an option that should be absolutely kept on the table as a and we have this and a lot of things that are at the bases. We have a toolbox of things in terms of we've talked about this with regard to financing. We need to keep all of our tools in our toolbox and have them available and make decisions about when to use them. And we think this is one we should keep in our toolbox. We think there are other options. There are typically pretty significant funds from the state to fund open space and parks. There are about six and half million dollars in WW funds for the East Bay Regional Park District has for a park at Alameda Point. This is the location where they would like to build that. And so there, you know, staff believes there are other ways. And I think there are discussions that recently occurred with the subcommittee, with the Park District and the city about potentially exploring the possibility of in re initiating discussions about using that six and a half million dollars to create a regional park here. And so I think from our perspective is, you know, this is not a slam dunk. It was we didn't when we analyzed it, we didn't think it was kind of a panacea that was going to solve all of our problems out there. We don't think we should discount it completely. We think we could. If the council direct staff, I think we're planning we'd like to come back in June. To get direction from the city council to initiate re initiate those conversations with the Park District for a creation of the regional open space. But we don't. Those conversations may not be fruitful or they may be delayed. And so we think we should keep this wetlands but mitigation bank idea in our toolbox. We should keep it, consider it. And if at some point we think it makes sense to initiate it, you know, then we can start that up again. There's nothing that could that would stop us from starting that at a future date. Thank you. And we do have one speaker on this item, Richard Banger. Finally. Thank you, Madam Mayor, and members of the Council, especially council member Odie. Thank you for putting this on the agenda in January of last year. In fairness to the staff, they did complete this report in a very timely fashion. It was done, I think, in August of last year. And so I think the staff for that, it was very informative. And I think for me it illustrated something that a lot of hot ideas are not so hot after you get all the information. And I learned a lot from this. One thing that I learned was that this is going to take it would take almost magic, I would say, to get the state to agree to allow wetland mitigation bank to happen on public trust land. As Jennifer pointed out, the State Lands Commission frowns on that. If we have to go to the Assembly, I can easily see the assembly. I mean, members all over the state saying, well, we set a precedent here. What kind of future developer shenanigans might happen because of this? Because now it's a precedent and why not just leave well enough alone? Another issue is the no public access. Well, soon as I read that, that is completely incompatible with our white long standing vision of there being a regional park there. And I think one of the goals of the park should be to bring people in contact with nature, not keep them away from it. There's already about 512 acres on the VA property that is off limits currently, and I would like to see nature to be accessible to people. Another issue that would come up is what mitigation bank is a for profit operation, and I'm fairly certain I could be corrected on this, but I'm fairly certain that. That precludes receiving public tax money. I don't think we can give public tax money to a for profit wetland irrigation bank. So there goes the six and a half million dollars for the regional park. We're not going to be applying for any of that new money from the the regional ballot measure in June, if that passes. So I think there I think there is opportunity to create wetlands there that end grasslands, other natural habitat without going through this exercise, which we don't know how long it's going to take to even get that, you know, fully sell all those credits. And there's also another wetland mitigation bank that's about to be approved in the South Bay. And of course, they'll be they'll be ahead of us and they'll already be. Offering credits for sale. It's about 58 acres. So. At this point, I would say it's not a good fit for Alameda point. Thank you very much. Member It was your referral. Did you want to speak first? Let's make a couple of quick comments. I'm glad that Richard, we were finally able to hear your public comments. I know you stayed late for a couple of meetings and an agenda item got kicked. So appreciate you hanging in there. I do think it's a good idea to keep keep this on the table. You know, it is, you know, a 5 to 6 year project if we decided to undertake it. I mean, whereas if we actually somehow made a deal with the Park District to either give them or sell them this property, they could in turn. Turn it into a mitigation. Is that possible? Well, I think we first of all, we can't sell them the property because the state lands. When we act on behalf of the state of California as trustee to state lands, we have to maintain ownership over it. So we could only the maximum we could do would be a 66 year lease. And then I think, you know, that's going to be subject to the transaction. There would be a lease document and a transaction of the direction from the council were to essentially say the terms of you creating an open spaces that you can't turn around and create a wetlands mitigation mike that those could be discretionary terms that go into a negotiation and transaction with the Park District or the council could direct staff to say you could create it, but then we need to share 5050 in any proposal or you know, there is it would be like any other transaction that we could we could negotiate those aspects of it. Okay. Thank you. So just on a high level, you know, we are on the front edge of the battle for climate change and the battle to combat climate change. You know, we are at sea level will be directly impacted by sea level rise and and wetlands are a tool to help combat that. So I don't think it's something we should, you know, take off the table. You know, I do understand the concerns that, you know, once you put it in a bank, it becomes a passive park and you're pretty much restricted and you can't do anything on it, even trails. So that's something I think if we do decide to go down that path, we keep it in our toolbox and decide to do that. That merits a lot more public discussion to see exactly what type of parks we want out there, whether we want them passive or whether we want them more active. So, you know, these projects and just looking at the bottom line, 450,000, somebody else told me that they could be up to 600,000 or credit now. So, I mean, my understanding is the VA watch the map was up there. It's the spot right below. Right below. Okay. We were thinking of doing a mitigation bank. They actually have to provide some mitigation so they will be in the market for these credits. Is that. That's not. That's correct, right. That's my understanding. But I don't know for sure. So I mean, it could it could be a win win for both us and the VA because that's a project that we're also very excited to see come to Alameda and again. The mayor has discussed this when we've talked about leases, you know, about making sure that we maximize the value we get for our properties because this does belong to the public. And I think this gives us an opportunity to do that. If we keep it in our toolbox and, you know, if we're able to net $9 million from this someday, then that 6.5 million, this would be a supplement from that 6.50, that's similar. 6.5, you know, not a replacement. So, you know, I think if we somehow had 15 and a half, $16 million that we could spend on parks in the long term, that would be a good thing for Alameda. So I hope that we keep this in our toolbox. That's pretty much and I think, Steph, for all the hard work they've done on this. Can I just I just want to clarify one thing is that you can have public access. It's just that you can't count it towards the bank. So you have to kind of net that. I just want to be clear, you could have some public access. Like a trail, you know, walking and seeing the bird's nest. So that would be you'd have to net that out of it. Couldn't be counted towards the bank. Any other comments? Right. Then we're going to move on to item six B. Recommendation to appoint the nominated members of the Mayor's Economic Development Advisory Panel. Sorry to. Good evening. I'm Debbie Potter, the city's community development director. And I am pleased to be before you this evening to request the council's appointment of the mayor's nominated members of the Economic Development Advisory Panel. The purpose of the panel is to enhance the business climate here in the city of Alameda, as well as support the city's key