SR-05-13-2014-8A - 104-000-10City Council Meeting: May 13, 2014
Agenda Item: `F °--
To: Mayor and City Council
From: Marsha Jones Moutrie, City Attorney
Subject: Hines Development Agreement — Decision on Referendum
Recommended Action
Staff recommends that the City Council ( "Council') hold a public hearing to reconsider
and to determine whether to repeal Ordinance No. 2454 (the Hines Development
Agreement) or to submit the question of repealing the ordinance to the voters. If
Council sends the question to the voters, staff recommends that the measure be placed
on the ballot of the November general election and that Council direct staff to prepare
the necessary resolutions.
Executive Summary
On February 11, 2014, Council adopted Ordinance No. 2454 which is a development
agreement with Hines 26th Street LLC authorizing the construction of a large,
predominantly commercial project at 1681 26th Street. On March 11, 2014, a
referendum petition was filed with the City Clerk ( "Clerk) protesting adoption of the
ordinance. On April 22, 2014, the Clerk reported to the Council that the measure had
qualified for the ballot. Because it qualified, the California Elections Code requires that
the Council either repeal the ordinance or submit it to the voters, either at the next
general election or at a special election.
If Council opts to submit the matter to the voters, staff recommends directing staff to
prepare the resolutions necessary to place the matter on the ballot for the next general
municipal election which is scheduled for November 4, 2014. Currently staff anticipates
coming to the Council in June 2014, with the appropriate resolutions that will set that
election. This item will be added to those resolutions if the Council decides to place the
referendum on the November ballot. This approach would conserve staff time and
public resources by saving the City the cost of a special election. That cost is estimated
at approximately $200,000, while adding the measure to the November ballot would
cost approximately $5,000.
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Background
On April 11th of this year, Council adopted as Ordinance No. 2454, a development
agreement with Hines 26th St. LLC for the construction of a 765,095 square foot, mixed
use project at 1681 26th Street. The predominant use of the project is creative office
space (374,434 square feet). The project also includes 473 rental housing units, 25
artist work /live units, restaurant space (15,500 square feet), retail space (13,891 square
feet), various publicly accessible outdoor spaces, and public streets that would run
north -south through the project site.
On March 11, 2014 opponents of the project filed a referendum petition with the City
Clerk. Signatures were gathered, and they were verified by the County Registrar. On
April 22, 2014, the Clerk reported to Council that petitions had been signed by more than the
requisite 10% of the City's registered voters. Thus, the referendum qualified for the ballot.
Discussion
The Council's choices are established and constrained by state law. Elections Code
section 9237 provides that, once a referendum petition qualifies, "the effective date of
the ordinance shall be suspended and the legislative body shall reconsider the
ordinance." Elections Code section 9241 provides, in pertinent part, that "[i]f the
legislative body does not entirely repeal the ordinance against which the petition is filed,
the legislative body shall submit the ordinance to the voters, either at the next regular
municipal election ... or at a special election called for the purpose, not less than 88
days after the order of the legislative body." If a challenged ordinance goes to the
voters, the Elections Code provides that it shall not be effective until approved by a
majority of those voting.
The Elections Code also establishes certain consequences of repeal. It provides that, if
the legislative body repeals the ordinance or if the voters vote against it, "the ordinance
shall not again be enacted by the legislative body for a period of one year after the date
of its repeal or disapproval." Section 9241. This provision of state law precludes
adopting, within one year, another ordinance which is "essentially the same" as the
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challenged ordinance. Lindelli v. Town of San Anselmo, 4 Cal.Rptr.3d 453 (2003). In
deciding whether the subsequent ordinance is essentially the same or different, the
courts focus on the features that gave rise to the popular objection. Id.
Thus, under state law, the Council's immediate options are to: (1) reconsider and repeal
the ordinance in its entirety; (2) if the ordinance is not entirely repealed, put the question
of repeal on the ballot for the November general election; or (3) call a special election to
occur between August 10, 2014 and November 4, 2014.
Staff recommends against the third alternative. It would require the City to bear the
costs of a stand -alone election. And, this public expense seems unwarranted given the
proximity of the general election.
As between the first two alternatives -- repealing the ordinance or submitting it to the
voters at the general election — either process will fully and finally resolve the issue of
whether the ordinance should be repealed. If Council favors a prompt resolution, then it
may wish to decide the matter itself. On the other hand, Council may favor an election
as the preferred means of settling a dispute that has divided the community.
If Council opts to send the matter to the voters, staff recommends a Council direction to
prepare the necessary resolutions to place the matter on the ballot.
Next Steps
If Council places the issue on the November ballot, staff will return in June with election
resolutions, including the language necessary to place repeal of Ordinance No. 2454
before the voters. If Council decides to call a special election, staff will also prepare the
necessary resolutions, though perhaps sooner.
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Financial Impacts & Budget Actions
There is no immediate financial impact or budget action necessary as a result of the
recommended action. Staff will return to Council with estimates for placing the measure
on a Special Election or Regular Election ballot. At this time, it appears that a Special
Election would cost approximately $200,000; adding this measure to the November 4,
2014, Regular Election ballot would cost approximately $5,000.
Prepared by: Marsha Jones Moutrie, City Attorney
Approved: Forwarded to Council:
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