Today’s San Francisco Chronicle includes a pair of opinion pieces discussing alternatives for the problem posed by the pending development of 80 Natoma Street and it’s effect on the hoped-for extension of Caltrain to the new Transbay Transit Center.
In this first piece, José Luis Moscovich of the county Transportation Authority discusses possible modifications to the design of the planned 80 Natoma building that would allow it’s development to go forward (precluding the need for an eminent domain acquisition of the site).
Is tower an obstacle to regional transit?
Jose Luis Moscovich
Tuesday, September 28, 2004
The San Francisco County Transportation Authority has committed to this project, successfully advocating for its inclusion in the regional-rail agreement approved by the Metropolitan Transportation Commission, and dedicating $270 million from the local transportation sales tax (Proposition K), the largest secured amount of funds from any source.
However, a controversy has arisen over the construction of a 48-story condominium tower at 80 Natoma St. The site is right in the path of the future underground approach to the terminal. The tower went into construction earlier this year, generating alarm about whether it will be possible to build the tunnels under the building at a later time. This is but a passing distraction from our main concern: How to get the project funded.
According to the Transbay Joint Powers Authority (TJPA), the agency charged with delivering the project, Transbay will cost $4 billion, of which half is financing costs. (For context, the BART SFO extension cost $1.4 billion.) The TJPA’s funding plan has a gap of about $200 million in unidentified funds and more than 50 percent of the project’s funding plan relies on the passage of the statewide High Speed Rail bond measure in late 2006. The plan requires a $690 million federal loan. Proposition K and bridge tolls are the only sources of secured funding for Transbay in the early years, and though the project is obviously of regional significance, the majority of funding comes from San Francisco.
AC Transit, the East Bay bus operator that will claim a floor of the new terminal, is not contributing any capital funds up front, and San Mateo County is only contributing $27 million. The state is facing huge deficits and federal transportation funding trends are not encouraging either. This funding plan leaves us few options should the High Speed Rail bond fail to pass in 2006.
While the county transportation authority’s commitment to Transbay is not in question, it must be noted that the funding plan puts most of early funding demands, hence most of the risk, on the Proposition K tax program. The authority’s approach to the 80 Natoma St. conflict must be understood in that context. So, when asked to pay $32 million to condemn the property for public use, our board asked whether there was a cheaper alternative. As long as there are significant unresolved issues with Transbay’s funding plan, this question will come up every time Proposition K funding is requested.
As a major funding partner for Transbay, with a responsibility to San Francisco’s voters to oversee the cost-effective delivery of transportation improvements throughout the city, it is prudent for the county transportation authority to ask this question. The authority receives $63 million in sales tax every year, and must stretch those dollars to address the needs of 23 categories of projects, ranging from the Central Subway and buying Muni buses, to funding street resurfacing and pedestrian and bicycle safety projects, in addition to Transbay.
In this case, as Mayor Gavin Newsom and the San Francisco Board of Supervisors requested, we explored and found a feasible engineering solution, as corroborated by a peer review panel of expert engineers, that allows the two projects to co-exist and complement each other, and that is clearly cheaper than condemnation.
For $14.9 million, the tower’s foundation can be modified to accommodate the train tunnels safely. This can be accomplished over the next few months, which would allow the tower construction to move forward. An easement, included in the above cost, would be purchased and included in property documents and deeds for all the condominiums, to shield the TJPA from future lawsuits from homeowners that might later want to try to stop the digging of the tunnels under the building. The TJPA can then take the time it needs to design the tunnels and build them when the construction money for the Transbay project is secured. At that point, there will be limited additional costs for somewhat more complex tunneling and shoring of the tower, but those costs have been estimated at a maximum of $18 million. By contrast, the final cost of condemnation is likely to go well beyond the estimate, since the developer is already claiming more than $25 million in additional documented costs, pushing the total closer to $60 million.
On a parallel track, we recommended jointly with the MTC, an allocation of $21 million to the TJPA to start preliminary engineering for Transbay, focusing on tasks that will help reduce costs and ensure that the project can be built.
The reality of squeezing a new high-speed train terminal into the heart of San Francisco is, predictably, a series of compromises. Given the dense urban setting and the uncertain funding, we must find opportunity in compromise.
José Luis Moscovich is the executive director of the San Francisco County Transportation Authority.
And now, in the second piece, Mike Nevin, the Chairman of the Transbay Joint Powers Authority states the case for acquisition of the parcel in the public’s interest.
The new Transbay Terminal at Mission and Natoma streets in San Francisco would combine Caltrain to San Jose and Gilroy; high-speed rail to Los Angeles; AC Transit buses to the East Bay; Muni, SamTrans and Golden Gate Transit buses to San Francisco, the Peninsula and the North Bay. Our agency, the Transbay Joint Powers Authority, has more than $1.6 billion in committed revenues to pay for the $2.1 billion terminal (with debt service, $3.9 billion). We have the support of three public votes — San Francisco Proposition H (1999), San Francisco Proposition K (2003), and Regional Measure 2 (March) – all mandating the Transbay Terminal project and providing funding for this important public facility. We are ready to move forward.
There is, however, a conflict between this project and another proposed project. In order for the Transbay Terminal to be feasible, it must include a rail component. That rail component, the extension of Caltrain and high-speed rail into the Transbay Terminal, must cross under the vacant 80 Natoma St. property, a site on which a private developer plans to build the tallest residential tower west of the Mississippi (48 stories). There is no other feasible alternative to this conflict that satisfies state mandates and all of the exacting criteria of the world’s high-speed rail systems.
In addition to a new Transbay Terminal, the Transbay Redevelopment Project would include 3,400 new housing units (with 1,200 affordable units). This housing would be developed on 19 acres of Caltrans property, which the state dedicated to help fund the terminal project. This donated land will be sold off to developers to create housing. The proceeds of the sales ($287.9 million) and the tax increment ($534.2 million over 40 years) will be dedicated to the funding of the Transbay Terminal and rail extension. This is an enormous and important commitment from the state, which demands a serious obligation from local officials to deliver the project.
The 80 Natoma St. eminent-domain decision — which the San Francisco Board of Supervisors will consider today — tests our ability to deliver the project. After careful consideration of several alternatives and the subsequent rejection of those alternatives by the developer, the Transbay Joint Powers Authority (TJPA) board recommended to the San Francisco Board of Supervisors to condemn the three-quarters of an acre lot known as 80 Natoma St. We believe this offers the best balance of cost and risk avoidance, and is clearly in the best interest of the public.
Our engineers have worked for more than seven months with the engineers employed by the developer of 80 Natoma St. to identify an agreeable solution that would allow both projects to move forward. After this engineering study and the expenditure of more than $750,000, we have determined that there is no way to achieve both projects while meeting the developer’s demanded time line.
Another agency, the San Francisco County Transportation Authority, who is responsible for the administration of the county’s sales tax and is one of many funders of the Transbay Terminal Project, has proposed a conceptual design that it believes may allow the TJPA to tunnel beneath the 48-story building planned for 80 Natoma St. after it is constructed and occupied.
The county transportation authority’s concept places the burden of extreme risk on the TJPA, would cost three times more than acquiring the property through eminent domain proceedings and jeopardizes the feasibility of future construction of the Transbay Terminal. This risk manifests itself through the ability to insure the county transportation authority’s tunneling proposal — a proposal that would attempt the first-ever tunneling under an already existing 400-unit building in an earthquake zone. Furthermore, if the conceptual design proves unworkable, the terminal project will either require the implosion of the building or the Transbay project would stop. The TJPA has studied more than a half-dozen design options for the co-existence of the terminal and 80 Natoma St. Many of these options were technically feasible but were rejected by the developer because of his schedule needs. Everyone would like to see a joint design option that would work for both parties, and to that end we have offered a joint-design concept that is still on the table. However, the county transportation authority’s concept, from both a policy and engineering standpoint, is not prudent nor is it realistic. It would cost more (approximately $90 million), amount to similar delays (in excess of one year) and be less technically sound (not another Bay Bridge approach) than previously solutions identified in our technical evaluation (see Technical Evaluation of Design Options for the Transbay Terminal Project to Address Myers Development Company’s Proposal for a High-rise Building on the 80 Natoma Property (www.transbayproject.org).
All of this effort to accommodate a developer intent on building a 48- story tower sooner, at the expense of a regional transit solution and re- development of an entire area of San Francisco.
The 80 Natoma St. issue has been politicized far beyond its importance. For years, the property has been nothing more than a parking lot on an alley in the path of an enormously important public project that should be above politics. It is a necessary property acquisition, and will allow us to build the best and most functional terminal at the lowest cost to the public.
Acquisition of 80 Natoma St. (appraised at approximately $32 million) is in the public’s best interest, and the San Francisco Board of Supervisors will serve its constituents and the region well by moving forward this Tuesday.
Mike Nevin is a San Mateo County supervisor and chairman of the Transbay Joint Power Authority.