Oakland City Council Reneges on Army Base Redevelopment Project

After all, coal is evil, right?

The reuse plan for the former Oakland Army Base, approved years ago by the Oakland City Council, was heralded as an economic and environmental boon for Oakland and the entire region, with the project capitalizing on the existing proximity of rail to a deep-water port. That is until the Oakland City Council members changed and the new members solidified their “wokeness” in trying to kill the project.

The former Oakland Army Base was decommissioned in 1999. In 2000 it was designated a redevelopment project area, and eventually divided into three multiple projects, including the Gateway Development Area owned by the Oakland Redevelopment Agency and the Port Development Area owned by the Port of Oakland.

Twelve years later, in 2012, Oakland Bulk and Oversized Terminal (OBOT) CEO and local Oakland developer Phil Tagami, was granted the contract to develop the former Oakland Army base into a $250 million global logistics center.

OBOT proposed building a massive international logistics center, anchored by bulk commodities shipments, largely because the Port of Oakland already had enough container shipments. OBOT proposed instead of trucking the commodities, to move cargo via the adjoining rail, thus helping air quality throughout the region by reducing truck traffic. Key to his plan was the access to existing rail and Oakland’s deep-water port.

There was a local-hire mandate in the agreement guaranteeing new construction and logistics jobs to Oakland residents. The plan and agreement was so popular that the State of California made a $274 million grant.

According to OBOT/Tagami’s attorney David Smith, the Oakland City Council loved the grand scale, generational proposal. In 2013, they adopted a development agreement which gave the Tagami group a “vested right” to build and operate a bulk commodities terminal at the West Gateway site under the regulations as they existed at the time of the agreement. “Vested rights” locks in the rules effective the date of signing. Attorney Smith says this is terribly important and standard in massive, grand scale, generational projects. An iron-clad commitment is needed so future city councils won’t swoop in and take the project.

Agreement/No Agreement

In 2015, the Sierra Club and oil and gas billionaire Tom Steyer learned that the new facility might ship coal. Four counties in Utah had joined together and pledged $50 million to the facility to ship Utah clean coal to Asia through this Oakland port. At the time, coal made up 40%-50% of shipments of bulk commodities. Ironically, Steyer became a billionaire, largely in part from his investments in gas and oil, prior to his jihad against fossil fuels.

The Sierra Club’s “No on Coal” campaign, which was already attacking coal mines, coal production, and coal transportation, directed an attack on the entire Pacific Coast, shutting down Washington, Oregon and Long Beach ports that ship fossil fuels and coal. The plan was if they could block shipping facilities, they would create a big enough problem that coal producers and mines would be prevented by a lack of demand from even mining it. So they launched an assault on the OBOT project, and the all-new Oakland City Council jumped on the Sierra Club bandwagon.

Not long after, the new Oakland City Council found itself the subject of a federal lawsuit by OBOT/Tagami. And as attorney David Smith explained, Tagami didn’t want litigation – he wanted his project to go forward, and he wanted the City of Oakland to stand behind the 2012 agreement.

Then Oakland Mayor Libby Schaff apparently sent Tagami an email saying, “Never ever will you ship coal through my city.” Mayor Schaff told him to ship anything else, but coal would never be allowed to pass through the Oakland Bulk and Oversized Terminal.

So developer Tagami offered to ship grain. Mayor Schaff likes this idea, according to attorney Smith. But Tagami tells her it is GMO grain (genetically modified) and the Mayor does an about face, and tells him no to the grain shipments.

This about face proved why the vested rights agreement was and is so necessary.

As attorney Smith explained,  “there was never any doubt then or now, and the Council itself acknowledged, that fossil fuels were likely to be shipped through the terminal, in that they compromised the majority of commodities shipped globally by such facilities.”

The Oakland City Council carried out months of bogus hearings, and ultimately adopted an ordinance banning coal and Petroleum coke in the City, though, as attorney Smith said, “exempting all existing uses or handling of coal, rendering the Ordinance applicable only to the terminal.”

The Northern District of California judge in the lawsuit recognized the City’s phony hearings, and lambasted the City of Oakland in a strongly worded ruling, holding that the Ordinance breached the City’s agreement with the developer.

However, according to attorney Smith, the ruling has done nothing to alter the City’s behavior.

The City of Oakland still refuses to process permit applications. They refuse to even meet to discuss the project as required in their agreements. And they continue to refuse to move the project forward at all.

“Most recently, the City even claimed that the developer breached its lease with the City and claims the lease is terminated,” attorney Smith said.  “Ironically, though, the City has made no effort to gain possession of the premises.  The developer has filed another lawsuit in state court.”

The Ninth Circuit Court of Appeal will hear the City of Oakland’s appeal of the Northern District Court case on Tuesday November 12.

Unfortunately, Smith says, no one in the Bay Area media have reported the full story or questioned the City’s outrageous and illegal behavior.

California Globe will report back on the Ninth Circuit hearing. Stay tuned.