Developers agreed to pay nearly the full property assessment rates to help fund transportation projects in the Transbay Transit Center District, under an agreement announced by the Board of Supervisors yesterday. Supervisors and Mayor Ed Lee stood their ground against the developers, who hired former mayor Willie Brown as a lobbyist to try to lower the rates on the special infrastructure tax district, known as a Mello-Roos District. The move threatened to cut funds from the extension of Caltrain and high-speed rail downtown into the Transbay Center under construction.
The SF Chronicle reports:
Under the agreement, the city will still collect up to $1.4 billion in taxes from property owners around the new transit center for the Caltrain, and possibly high-speed rail, connection. But the revenue would come in over 37 years instead of 30 after city officials agreed to extend the life of the tax district to make it more palatable for the property owners.
Even though the rates hadn’t changed from 0.55 percent of property values, developers complained that the skyrocketing value of real estate in downtown had increased the maximum project revenues in the district from $400 million to $1.4 billion.
The Board of Supervisors won’t vote on final approval of the agreement for another two weeks while the details are worked out, but members said it looks solid at first glance. Supervisors Scott Wiener and Jane Kim lauded the agreement, and credited Mayor Lee for standing firm against the developers’ attempts.
“I’m not referring to this as a compromise, because the [Transbay Joint Powers Authority] is getting all the money that we were seeking,” said Wiener.
Mayoral spokesperson Christine Falvey told the Chronicle on Monday, “The city believes that the special tax rates that the developers are being asked to pay are more than fair considering they are taking advantage of a very significant increase in height limits for their buildings offered under the transit center district plan.”
The developers apparently backed down on their threats to sue the city if it didn’t assess the property values at their 2007 rates rather than current ones. Before the agreement was reached in a closed session, Wiener said, ”If [a lawsuit is] what has to happen, so be it. I don’t think we should cave in.”
“I don’t think much of the legal claim that’s being asserted,” said Wiener. “I think it’s pretty clear that the valuation was not going to be at the bottom of the recession.”