Brian Carver's MOU #3 City Council Statement

The following statement was read aloud by Emeryville resident Brian Carver at last Tuesday's momentous 'MOU #3 Council meeting' .  Mr Carver's statement, televised on ETV-Comcast channel 27, is reverberating around town and the Tattler has received requests to post it from many Emeryville neighbors.   The document Brian Carver refers to in his statement is the proposed MOU #3, a controversial agreement between the City of Emeryville and the Emery Unified School District that will quadruple the operating expenses for Youth Services and otherwise endanger the City's finances.

Here then is the July 2nd statement that's causing such a stir in our town, posted with permission from Mr Carver: 

"Good evening Mayor, members of the Council, my name is Brian Carver. I live in the Triangle neighborhood.

The document before you tonight is not a memorandum of understanding. It is a suicide pact.

The District promised us increased efficiencies and economies of scale from the Emeryville Center of Community Life, but instead, as your staff report points out, this document finally reveals that these are broken promises. Joining this project under these terms is going to cost the City dearly, in amounts that Staff are currently not even able to predict. What they can predict amounts to significant increases in annual expenditures that would require far more careful study than can be had in this single meeting.

If the State ultimately succeeds in taking away the nearly 22 million that has been the subject of the litigation described in the staff report, then this agreement would require the City to cover the District anyway—to “make them whole.” I am far less optimistic about the City’s ability to keep this money out of the State’s hands. It is an enormous gamble to take, because this could go the wrong way. When that happens, say goodbye to any hopes for a bike/ped bridge across the railroad tracks, forget about an Art Center, or a dozen other projects that might be important to Emeryville residents. All our resources will be allocated to this single project for a long time.

It has become clear to those of us following this process that the School District will stop at absolutely nothing in order to achieve its misguided vision. When 70 stakeholders signed a letter to the District asking that they not move the elementary students from Anna Yates Elementary and into this K-12 on San Pablo Avenue, the District was unmoved.

When Emeryville’s assessed valuation dropped and adequate bonding capacity was unavailable to seek a conventional bond for its fourth bond series, known as Series D, the District turned instead to a controversial Capital Appreciation Bond that will cost Emeryville taxpayers nearly $70 million over the next 32 years and eight months in order to receive just $17 million for the project today. With a total payback price tag now at nearly $150 million, many of us will be long gone before Emeryville taxpayers can pay off the enormous burden the District has placed on us.

Even at this cost, the District admits that there is not enough money to pursue an environmentally-responsible set of buildings that could achieve LEED certification as Emeryville’s municipal code requires of public agency buildings. So, the District had to seek a special exemption in order to become part of the problem of climate change rather than an example of its solutions.

The Emery Unified School District has rejected legitimate community concerns, abandoned any semblance of fiscal responsibility, has shown a willingness to run roughshod over the environment, and in general has shown that there is nothing that will dissuade them from this ill-conceived and poorly executed project.

But tonight they want this Council and the entire City to join hands with them as they gleefully jump off a fiscal cliff. This Council should finally be the responsible party and say no.

But if you’re not ready to do that, then I implore you to at least send this out to relevant advisory committees and give it more study, fill in more details, and get a better deal."

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Brian Carver is a parent of two children in the Emery Unified School District, was the Chair of the Center of Community Life Measure J Citizens' Oversight Committee from March 2011-2012, and has been critical of the School Board's moving of the elementary students from Anna Yates School to the Center of Community Life site on San Pablo Avenue.  An attorney and Assistant Professor at the UC Berkeley School of Information, Mr Carver is an occasional contributor to the Tattler.

Community Center's Operational Costs Shock City Council

Other Shoe Drops at Community Center

Massive New Costs to City Revealed

400% Increase in Operating Expenses
100% Increase in Maintenance Expenses
City's General Fund to be Put at Risk
$11 Million Gamble

After the smoke had cleared at last Tuesday evening's City Council meeting, the contentious Emeryville Center of Community Life had been transformed from a self-proclaimed fiscally prudent money saving school/community center project into a budget busting money pit festooned with poison pill hidden trap-doors ready to bankrupt City Hall.  Even long-time apologists for the project appeared stunned by the cascade of devastating numbers revealed.

Nora Davis
400% increase?!
We're supposed to be
LOWERING costs.

After waiting for years, the City's portion of the actual estimated operational costs of the Center of Community Life (ECCL) were finally revealed by the Staff leaving the majority of the City Council dumbfounded.  After having publicly pronounced "efficiencies" and "economies of scale" inherent in the new Center,  the revelations Tuesday made it clear these promises were never going to materialize and instead the project will actually increase the City's costs dramatically, the announcement of which drew loud exclamations from an incredulous Nora Davis, "The whole idea with this was to LOWER our costs" the Councilwoman said.

Under discussion was an agreement between the City of Emeryville and the Emery School District that would define many of the Center's operational arrangements. Known as a 'Memorandum of Understanding' (MOU) this would be the third such agreement in the ECCL design and development process, thus it is referred to as "MOU #3."

The City Staff Report revealed three major fiscal impacts if the City enters into MOU #3:

1. The agreement would require the City to make the District “whole” even if the City's former Redevelopment Agency's approximately $21 million is taken away by the State via pending litigation.
2. The City will assume significantly increased Operations and Maintenance costs for Community Services--the Staff Report estimates a cost increase of nearly 400%. 
3. The City will assume significantly increased annual allocation for Capital Replacement costs--estimated at a cost increase of over 100%.

$11 Million Gamble
The first point brought looks of dismay from the Council, as Staff explained that if the State Department of Finance succeeds in its efforts to challenge the City's ECCL contribution of approximately $21 million, then MOU #3 would still require the City to cover approximately $10-11 million of ECCL expenses.  The School District is in effect saying to the City, 'If you win your lawsuit, we want your money, and if you lose your lawsuit, we still want your money!'   Of course, the problem with this is the source of that $10 to $11 million is uncertain and would almost certainly jeopardize other projects on the City's Capital Improvements wish list.

Jac Asher
$20 million and we're 
NOT going to get 
our bike/ped path?

Mayor Kurt Brinkman appeared angered by the brazenness of the School District's new numbers, "The whole idea was the School District could run a leaner machine" he reminded Staff and the District employees attending.  Councilwoman Jac Asher also expressed dismay at the new numbers and she invoked an earlier revealed broken promise from the School District, "We shouldn't spend [more than] $20 million to not have a bike/pedestrian path" she reminded attendees, referring to the School District recalcitrance in building a required bike/ped path associated with the school/community center build out.

400% Increase
The basis of much of MOU #3 is a cost-sharing formula that has the District paying 71-74% and the City paying 26-29% of many expenses. In the case of the City's Youth Services this formula yielded a table on page 18 of the Staff Report that shows the City's current Recreation Center annual budget of $80,310 would, once housed at the new gold-plated ECCL, have to be increased to $319,279, an increase of 398%.  Jaws dropped on several Council members' faces, "We were supposed to SAVE money with maintenance and operating", said Council member Davis.

100% Increase
Finally, MOU #3 would require the City to set aside funds annually for major maintenance to the ECCL facilities. The Staff Report explains that currently, "the City contributes $386,500 per year to the Major Maintenance Fund for capital replacement for 139,755 square feet of public buildings and 44.21 acres of parks and open space."  The report continues, "It is anticipated that a like amount of money will need to be contributed on an annual basis for the City’s share of the capital replacement needs of the ECCL Project comprising 129,805 square feet of building space and 233,290 square feet of outdoor space."  That is, the City's annual major maintenance expenses are expected to double once the ECCL project is completed.

Kurt Brinkman
Does the School District
have any idea what
it's doing?

One other moment during the discussion brought the room to an eeiry silence. Mayor Brinkman asked City Staff whether the School District had sufficient funds to complete the project, wondering whether a final cost agreement was in place between the District and Turner Construction, "Does anybody have any idea what is the cost of the project?"  City Staff indicated that, to the best of their knowledge, the District was still in discussions with Turner and so this remained uncertain.   While the rest of the stunned room seemed to be quietly asking themselves whether the ECCL could be built at all, Mayor Brinkman noted that construction costs are currently rising and it would be good for the District to get this finalized, "With prices going up for construction, does the District have the money?" he asked.

The Staff promised to revisit the Council in September so a final MOU #3 agreement with the School District can be struck, "bring us back some better numbers" Councilwoman Davis warned.