Nov 29 2020

– The Proposed Piedmont Center for the Arts Lease Is Flawed –

On November 16, 2020, three City Councilmembers voted to approve a 7-year renewal of the City’s lease of 801 Magnolia Avenue to the Piedmont Center for the Arts (PCA), rejecting a motion to allow more public input first. Because the City Council will have a second vote on the proposed lease, Piedmonters still have an opportunity to express their views by writing to the Piedmont City Council at: 

cityclerk@piedmont.ca.gov

The threshold question for the City Council is whether to continue PCA control of a City building.

Public comment was split between those appreciating PCA’s role in hosting arts events and those who hoped that 801 Magnolia could become more of a “community center” where arts is one use, but not the only use.

Most Piedmont non-profits rent City or School facilities as needed (e.g., Education Speaker Series, Diversity Film Series, Piedmont Soccer Club); PCA could do the same for its arts events. The City Manager stated that Recreation Department programs could fill any unused City space and the PCA space is often unused (even pre-COVID), other than as a quiet space for its commercial sub-tenant.

This is not a choice between arts and no arts, but rather how best to maximize community benefit from limited City spaces. If the City Council decides to renew PCA’s lease, the proposed PCA lease has four major flaws. As a result, it fails to achieve the goals set forth in the City Staff Report. The lease is at:

https://www.ci.piedmont.ca.us/common/pages/DisplayFile.aspx?itemId=17199779.

(1) Future City Construction.

The proposed lease prevents the City from terminating the lease until January 2024 at the earliest—and then only if the City is conducting significant renovations of the Police, Fire or Recreation buildings. (See Sections 1.8 & 9.2).

The City, however, plans to seek voter approval of bonds to renovate or rebuild City buildings in Spring 2021. The City’s building plans might include relocating City staff to 801 Magnolia Avenue while construction is ongoing or even a new structure at the 801 Magnolia Avenue location. The City could be ready to begin construction in Summer 2022, but be blocked by the PCA lease, as construction costs increase during the delay.

The simple fix is to amend the lease to allow the City to terminate without cause on 180 days’ notice (note that the City’s lease to the Piedmont Educational Foundation allows termination without cause on 90 days’ notice).

(2) City Use of 801 Magnolia Avenue.

Because the 801 Magnolia Avenue space has been unused much of the time (other than PCA’s sublease to The Piedmont Post), the City seeks the right to hold “City Sponsored Activities” there or to rent it out for “City Private Rental Activities.” A good idea, but the proposed lease puts unwarranted hurdles in the City’s way.

The proposed lease would allow City-Sponsored Activities, but only (i) with advance notice, (ii) if the City cannot go elsewhere, (iii) if the City mitigates PCA’s concerns about “unreasonable interference” with “Tenant’s use,” and (iv) the City tries to relocate its activity if PCA asks. (Section 4.2(c)). City Private Rental Activities, allowed only if PCA has nothing planned, face similar restrictions. (Section 4.2(b)).

The simple fix, consistent with the City’s ownership on behalf of all City residents, is to allow the City to schedule any activity there that is compatible with any arts related activity previously scheduled by PCA. At a bare minimum, a City right to terminate without cause on 180 days’ notice will ensure good faith cooperation on both sides.

(3) Revenue for City Expenses.

In 2011, the City gave PCA a no-rent lease because PCA agreed to pay to perform long-deferred maintenance on the building. In the proposed lease, PCA pays no rent, but is not asked to perform any work. By contrast, another non-profit, the Piedmont Education Foundation, pays rent of $19,020/year for less nice space inside Veterans Hall.

PCA’s 2019 balance sheet shows over $406,000 in assets and its 2018 and 2019 profit & loss statements show income exceeding expenses. After public comment that PCA could afford to pay rent (like most non-profits using City or School facilities), PCA’s Treasurer stated that PCA could “do more,” i.e., pay rent. The City has stated that it needs revenue to fund maintenance. Accept PCA’s offer!

(4) Equal Access.

In the past, PCA has turned away those who did not meet its definition of “arts-related.” The Staff Report says PCA agrees to more diverse programming, but the proposed lease would narrow PCA’s Approved Uses from a “venue for exhibits and performances” to “arts-related” activities only, plus its sub-lease. (Section 1.1).

In theory, the City Private Rental Activities provide another path for residents to rent the 801 Magnolia Avenue space, but, as noted above, the City’s rights are restricted. Even if that is fixed, PCA has the first right to schedule events. The lease should require PCA to rent space to any Piedmont resident for any event compatible with the space.

I encourage Piedmonters to share their views on the proposed PCA lease, as it will determine the use of 801 Magnolia Avenue for the next 7 years.

Rick Raushenbush, Piedmont Resident and Former Piedmont School Board

Editors Note: Opinions expressed are those of the author.  The Piedmont Center for the Arts (PCA) is a separate organization from the Piedmont Civic Association (PCA) that originated in 1986 and provides this news site. 
Nov 18 2020

Would the City lease out and give control of the Japanese Tea House to a private organization in the same manner as proposed for the Piedmont Center for the Arts?

__________________

To: Piedmont City Council:

I have read with great interest the upcoming approval by the City of a lease for the 801 Magnolia Avenue building. Here is my “slippery slope” argument to highlight the consequences of extending the proposed lease to The Piedmont Center for the Arts.

——

I have just formed a new nonprofit, Cherry Blossoms, Inc. (“CBI”). Our nonprofit would like to get a five-year lease from you for the City’s Japanese Tea House, and its surrounding deck for $1.00 per year. We plan to rent it out for art exhibits, bonsai exhibits and to professional Japanese puppet masters and to Kabuki theatre performers to bring culture to the Piedmont community.

We also would plan to make money renting to music teachers for individual & group lessons and recitals, especially on traditional Japanese instruments. Anyone else wanting to use it could apply to rent it from us, and we would rent it out at our sole discretion charging whatever user fees we think we could get.

Our lease would provide that the City would be responsible for all water, refuse removal, exterior maintenance, including decks, benches, trees, landscaping maintenance, and any maintenance related to the structural integrity of this sweet little building. CBI would be responsible for interior maintenance; we will be making lots of money in rental fees and so could easily do any inside maintenance that we, in our sole opinion, decide needs doing.

Once a year the City could rent it out from us for the Japanese Consulate visit or for a bride using the Community Center as a “City Private Rental” with six month’s advance written notice to us, unless we later decide we really need to use it. In that case, we can just give you 30 days’ notice prior to your scheduled booking and you will have to try your best to find another venue.

Such a lease with us is modeled exactly on the one you are already giving to the Piedmont Center for the Arts and will demonstrate the City’s support for Asian arts in Piedmont.

Now that the City is supporting the arts by giving away other under-utilized city buildings, we demand equal treatment. We have the blessing and backing of a significant portion of the Piedmont community and will be presenting our proposed lease to you for a First Reading as early as possibly in January, long before the cherry trees bloom.

We look forward to working with you to advance the arts in Piedmont.

M. Rhiger, Piedmont Resident

Editors Note: Opinions expressed are those of the author.
Nov 17 2020

November 16, 2020 on a first reading, the Piedmont City Council split their votes on extending a $1 per year lease for seven more years to a private organization, Piedmont Center for the Arts, of Piedmont’s property at 801 Magnolia Avenue. 

For several hours more than a dozen speakers testified for and against the proposed lease extension of the 801 Magnolia building. The current $1 per year lease will expire in June 2021. 

Mayor Bob McBain, whose term on the Council is ending and who sets the agenda, noted he had promised the Arts Board and others, he would have a vote on the lease extension of the Piedmont Center for the Arts.  McBain acknowledged he and City Administrator Sara Lillevand had been meeting with the Art Center Board for months and in August he had informed others, including Lillevand, there were 3 votes on the City Council in favor of the lease extension.

With no publicity or public notice by the City, the matter was addressed favorably primarily by the Board of the Art Center. Other speakers concerned about the lease noted the lack of public input and need for alternatives to the problematic proposed lease.

All speakers supported use of the facilities for the arts while offering suggestions to protect the City’s interests and increase community involvement.

At the close of the public hearing and Council discussion,  Mayor Bob McBain preempted the other Council members and made a motion to approve the lease extension.  Vice Mayor Teddy King seconded his motion.  Council member Betsy Andersen, who was the 3rd Yes vote, asked that the term of the lease be changed from 10 years to 7 years.

Council member Jen Cavenaugh made a substitute motion seconded by Council member Tim Rood to table the matter in order to allow additional information based on questions and concerns plus more time for public input prior to approving the first reading of the proposed long-term lease of the property.  McBain, Andersen, and King voted against the motion, and it failed.

McBain and King’s motion was approved by Andersen, McBain and King gaining a first reading to extend the lease for 7 years. Rood and Cavenaugh voted no.

The matter will return in December, or later, to the Council after a new Council is seated in December.   McBain will have be termed out of office and his seat will be filled by Conna McCarthy on December 7, 2020.  Council member Jen Cavenaugh reelected to a second term on the Council will serve for another 4 years.  Council members, King, Rood, and Andersen will remain on the Council for two more years.

Some issues raised and not resolved prior to the Council approving the first reading of the lease were:

  • Why wasn’t the lease extension publicized in local media to gather public input?
  • How much more would it cost the City to operate the Center?
  • What is the financial condition of the Art Center, Inc.?
  • Who controls how the property can be used?
  • What is the value to the City of the property?
  •  Why are Art Center Board minutes and financial information not provided to the city regarding income and users?
  • Why are arts groups and other community organizations turned away in preference for commercial business activities?
  • How can revenue from the Center foster arts in the community?
  • The City recently stated it needed more money on two recent ballot measures. Why is the Art Center revenue stream of hundreds of thousands of dollars not considered a desired revenue source?
  • What is the status of the IRS 501C3 qualification given recent information on the Art Center?
  • Why are there terms in the lease that do not favor the taxpayers and City of Piedmont?
  • What information is available on cost-effective use of the building?
  • How can a private organization lease public property and then sublease to a commercial entity?
  • Why is the Arts Board allowed exclusionary control of the property and not include all segments of the community?
  • Why isn’t the building fully utilized?
  • Can conflicts  between commercial uses, recreation classes and art shows be resolved?
  • What are the CEQA issues raised by a resident who received short notice?
  • Will the new high school theater offer superior performance space?
  • Have parking demands been considered?
  • Where is the sub-tenant commercial lease?

Those satisfied with the lease extension spoke to:

  • Prior improvements made to the building.
  • Successful programs of music and art for Piedmont and the wider community.
  • Continuing benefit to the City at little cost.
  • Grandfathering the commercial newspaper sub-tenant lease
  • Expanding programs
  • Use by top artists
  • Volunteer commendation for a successful operation.

The Lease Extension approved by 3 council members is linked below:

Art Center Introduction and 1st Reading of Ord. 758 N.S. – Approving a Lease Agreement with Piedmont Center for the Arts for City Property at 801 Magnolia Avenue

Nov 12 2020

A controversial item has been placed on the November 16, 2020 Council Agenda…the lease of City property at 801 Magnolia Avenue, the Art Center.  Agenda here.

The Council composition is soon to change based on the recent election of Conna McCarthy to replace Bob McBain on the City Council. Given the lease terms and controversy, questions have been raised regarding the need to act prior to the seating of the new Council, which will occur within days in early December 2020. The current Art Center lease does not end until June 2021.

With over six months left on the lease, a citizen asked, “What is the rush?”  Others have called for a widely publicized community evaluation of the use of the City property, since one has never been undertaken.

Adding to the controversy, a proposed fee schedule for 801 Magnolia Avenue would not be developed and brought back to the Council until after the new lease agreement has been approved by the Council.

The staff report estimates the office space “market rate” rental at $50 per foot, by comparing it with the Veterans Hall office rental rate of $36 per square foot leased to the Piedmont Education Foundation, the  local non-profit organization benefiting Piedmont schools. The reason to compare a rental rate for commercial entities with the rental rate charged to a local non-profit is questioned.

Commercial rental space in Piedmont is at a  premium because of location and scarcity.  Plus, the City property at 801 Magnolia Avenue includes two much-sought-after parking spaces.

A number of citizens would like the fee structure to be a part of the lease discussion, prior to approval of any lease.  It has been proposed that the Recreation Department manage all use of the space to assure appropriate and full use of the property. The staff proposed agreement provides for City programs and events as well as private non arts-related rentals.

The building at 801 Magnolia Avenue was purchased with taxpayer’s funds.  If income from the property were to be maximized, it has been estimated rental income from various uses could bring in over $200,000 per year.

  • Who should manage the building?
  • What purposes should the property be used?
  • What use of this city property would be most beneficial for the community?

Opinion articles have been published on this site.

https://www.piedmontcivic.org/2020/11/04/opinion-city-owned-801-magnolia-building-should-be-run-by-the-city/

Opinion: Why Rush 801 Magnolia Lease?

Citizens have suggested various uses for the property.  Some are listed below.

— a community library,

— senior center,

— Dress Best for Less, drop off site and marking room, benefits schools and Piedmont’s local recycling goals,

— counseling/ tutoring space,

— recreation programs,

— meeting site,

— rentals for weddings, book reviews, receptions, celebrations,

— performances and art shows,

— recital and amateurmusical practice space.

The staff report is linked below

.Art Center Introduction and 1st Reading of Ord. 758 N.S. – Approving a Lease Agreement with Piedmont Center for the Arts for City Property at 801 Magnolia Avenue

Nov 6 2020

Piedmont Resident Urges Transparency, Hearings and Public Input before Lease of City Building at 801 Magnolia –

Nancy Lehrkind’s letter raises several questions/issues.

  • If the current lease does not expire until June, 2021, why is there such a rush to decide on the use and control of the site?
  • And why does the process at least seem to be less than transparent, with few or no public hearings?
  • And, if the West Wing building was unused 70% of the time, how can this be when such space is in short supply in the City?
  • And, who currently manages the choices of users and who will decide in the future?
  • And, who would receive the mentioned $260,000 per year which might be realized and how much financial support and space would then be available by adopting the commercial rental option?
  • And, given the passage of UU, would it make sense to defer usage decisions until the UU pool development can be coordinated with the 801 Magnolia Avenue site?

So many questions…so many reasons to have significantly increased public input. Transparency is a virtue in this case. Public hearings would be a welcomed start.

Aaron Salloway, Piedmont Resident

Editors Note: Opinions expressed are those of the author.
Nov 4 2020

– Regarding the City building at 801 Magnolia Avenue and the upcoming proposed lease to a private group by the City –

Are most residents even aware that the City Council is considering giving away control of the 801 Magnolia Avenue building with little or no notice to its citizens? Because I, for one, am very familiar with all aspects of this building, I do feel a duty to share my observations and ideas regarding its future use.

There is no question that The Piedmont Center for the  Arts has done a fine job of bringing quality live performances and art exhibits right into the heart of our town in the 801 Magnolia Avenue building. Since 2019, the Art Center no longer runs their own programs, but using the building as a “rental venue for the Arts,” they have booked many evenings of great entertainment and interesting art exhibits. These have been popular events which should continue, but control of the 801 Magnolia building needs to return to the City once the Piedmont Center for the Arts’ lease expires in June, 2021.

First of all, the Recreation Department could now make upwards of $260,000 a year of revenue for the City from bookings at 801 Magnolia based on what the Community Center brings in, plus everyone could use it.

Secondly, it was always intended that the Recreation Department could reclaim this City space after the first 6 years; that is how the lease was written. The Art Center was just the interim solution–renovating a public building with private funds at a time when the City could not do so. We raised the money, got all the contractors, managed the project – just put our heart and soul into it and kept our side of the bargain.

A simple “quid pro quo” with $1/year rent as part of the bargain! The reduced rent was NEVER a subsidy for art (See video of Council Meeting, March 7, 2011).  We stated our mission: “to promote artistic endeavors for youth within the Piedmont community,” because we felt such was lacking in our town.

Since the 801 Magnolia parcel was re-zoned in 2017 to allow for-profit commercial entities on this city-owned land, there have been many proposals about what could happen there once the current lease expires, including the best one for a commercial health club providing exercise classes, yoga, massage and physical therapy as well as nutrition services. As a center city building within walking distance of most Piedmont residents, these would be welcomed services. But I would still argue for control by the Recreation Department as the best way to ensure the greatest usage of this public building by the most residents for the highest revenue.

I would certainly not advise extending the current lease because in a dynamic community, situations change over time and the situation of the Piedmont Center for the Arts has certainly changed. Pre-Covid 19, in Calendar Year 2019, the part of the building they control (“the West Wing”) was unused 70% of the time while the other Recreation buildings were in constant use by residents for all sorts of activities. This fact, alone, should argue against continuing the lease of a prime public building to any private group with total power to decide who gets to use it and when.

It would be a different thing if the City just doesn’t need use of this building anymore; in that case, who would care? Further, as the purpose of The Piedmont Center for the Arts has now become a venue operating rentals for the arts, and it no longer “promotes artistic endeavors for youth within the Piedmont Community,” one should ask if it matters to the City, in considering a lease to them, whether this group is a nonprofit anymore.

Since the building is now zoned for commercial use, would the City allow The Piedmont Center for the Arts to operate as a for-profit entity at $1/year rent versus $260,000 revenue from Recreation Department uses or $15,000/month from a health club?

And, of course, the passage of Measure UU has changed the game in the city center, arguing against any long-term tie up of City property. These are big issues and options that the community needs a chance to understand.

With regard to a lease that doesn’t even end for another six months, it is impossible to understand the City’s rush to end all discussion, and, of course, any other options, by just giving away control to this private group.

The City should tell us, “what’s the quid pro quo of this deal” for the community? I just don’t see it! They should allow the current City lease with The Piedmont Center for the Arts to continue until its expiration in June, 2021 after which the 801 Magnolia West Wing would return to the City and Recreation Department jurisdiction.

Nancy N. Lehrkind, Founder & Former President The Piedmont Center for the Arts, Inc.

Editors Note: Opinions expressed are those of the author.
Nov 3 2020

The following are Piedmont election results as of 9:25 p.m. November 3.  Election results are not final until all votes have been recorded and certified.  The elected candidates are listed in the order of votes gained.  Election results are unlikely to change. 

Elected to the City Council:

Jen Cavenaugh

Conna McCarthy

Elected to the School Board:

Cory Smegal

Veronica Anderson-Thigpen

Hilary Cooper

Piedmont Ballot Measures:

Measure TT – Increase in real property transfer tax – Failed – by 31 votes

Measure UU – Pool Bonds – Approved – by over 2/3rds of voters

Updates can be found on https://www.acgov.org/rovresults/241/indexA.htm

Nov 1 2020

– Environmental Voting Guide written by Piedmonter Emily Ballati –

Things-are-Heating-Up-Guide-to-Environmental-Voting

Editors Note: Opinions expressed are those of the author. 
Oct 29 2020

The Mercury News Editorial –

Editorial: Reject Piedmont property tax hike for pool repairs

The Mercury News editorial is copied below:

“Piedmont residents tax themselves to ensure that they have the best schools and premier city government. The average homeowner pays $4,400 in extra taxes for schools and another $635 for city services.

But those taxes also drive up the cost of housing in the exclusive city surrounded by Oakland and further ensure that those with average means will not be able to crack the city’s residential market.

Voters in Tuesday’s election will face two tax hikes. Measure TT, which we have previously recommended voters reject, would increase the city’s tax on property sales to state record-high levels. Now we look at Measure UU, a $19.5 million bond proposal to pay for replacing three old community pools with two new ones. Voters should reject that, too.

Based on the city estimates provided to voters, Measure UU would add an average $263 annually to the tax bill for a home assessed at the city average of slightly over $1 million.

It a bit of a tricky calculation for voters because city officials in the ballot wording obfuscated the projected average tax rate as 2.6 cents per $100 of assessed value rather than an easier-to-understand $26 per $100,000.

It turns out that the city overstated that rate, especially for the latter part of the 30-year tax. The firmer number is that city taxpayers would collectively pay about $1.3 million annually to retire the bonds needed to finance the construction.

To put that number in perspective, the city spends more than that – nearly $1.7 million to be precise – just to cover the interest payments on public employee pension debt. Put another way, most of the pool bond payments could be covered by Measure TT, which is expected to add about $948,462 annually to the city’s transfer tax revenues.

Individually and collectively, the two measures raise a question of, how much is too much? Rather than throwing multiple tax measures at voters, city leaders need to prioritize and look for savings elsewhere.”

Oct 28 2020

I would like to extend thanks to the nearly one thousand volunteers, endorsers, and donors who have come together to support the future of the Piedmont Community Pool.

Passing any measure requires a tremendous amount of effort and money to educate voters about the timeliness, thoughtfulness, and importance of the ballot initiative. Over the last few months, citizens of all ages and areas in Piedmont have volunteered to talk with their neighbors about the critical timing and benefits of Measure UU.

Over 100 donors have contributed to the campaign to provide funds to print flyers and mailers. Student and adult volunteers have spent thousands of hours making phone calls, sending emails, and distributing informational materials door-to-door. Despite the challenges of connecting in person, a comprehensive coalition of city and school leaders, community organizations, and volunteers emerged to support Measure UU. Their message?  A world-class city like Piedmont should have a local pool and all the concomitant programs (lessons, sports, programs) that serve to strengthen our community.

I especially applaud the countless volunteers who have been extra careful about reaching out to their neighbors in safe ways. To minimize direct, in-person exposure, volunteers only conducted phone calls or dropped off flyers with personally written letters detailing why it’s critical to pass Measure UU in November.

One of the most moving letters that I read was from a family that actually doesn’t use the pool at all, but understands the value of building an asset that is appreciated by their fellow citizens: old and young, big and small. Norman Rockwell could not paint a warmer picture of a shared journey.

While our broad political climate has never been more divisive, I am proud to see and say that Piedmonters continue to think and act beyond themselves, always in the best interests of our wonderful community.

Dion Lim, Piedmont Resident

Editors Note: Opinions expressed are those of the author.