Mercury News: San Jose council agrees to buy land near Google project amid resident concerns

By Ramona Giwargis

October 31, 2017

SAN JOSE — City leaders Tuesday agreed to buy six pieces of land near Google’s proposed tech village for parking and road improvements despite concerns from some residents that taxpayer dollars are being spent to subsidize the tech giant’s private development.

Mayor Sam Liccardo stressed that the land acquisitions approved Tuesday will support improvements that were planned for decades — with or without Google’s proposed tech campus. Liccardo also said the money pegged for the land buys — about $15 million total — was allocated years ago and that $4 million came from Trammell Crow, Google’s development partner.

“The new roadway was being discussed for two decades,” Liccardo said. “These are dollars that we allocated and identified years ago in one case and, in another case, dollars we obtained from Trammell Crow.”

The San Jose council unanimously approved all the land buys Tuesday.

The $4 million from Trammell Crow, which went into a general city parking fund, stems from a 2016 lawsuit settlement. The San Jose Sharks’ parent company sued the developer and the city over a retail and office tower that would eat up 835 parking spaces near SAP Center.

Sarah McDermott from UNITE HERE, Local 19, a union that represents service workers, was among critics who questioned the decision.


"This is clearly helpful to the proposed Google project and it seems this is the clear motivation for the purchase,” McDermott said. “I’d like to ask why the city is willing to spend millions of dollars for land in the Google project but says it’s too early for the community engagement process. If you’re willing to spend this money then you should be willing to talk about community benefits.”

Five of the six parcels are at the northeast corner of West St. John and North Autumn streets. The seller is the Milligan Family Trust, and the parcels are collectively known as the former Milligan News site. The land appraised for $9.9 million in October 2016, but the owners made a counter offer to the city for $11 million — which was approved Tuesday.

One residential and two commercial occupants would have to be moved, according to city documents, costing about $400,000. That land will be used to replace Autumn Street between West St. John Street and Julian Street with a new roadway that completes the connection between 1-280 and Coleman Avenue.

The Sharks lease a portion of one of those buildings, city documents show, but will remain on site until the building is relocated.

The sixth parcel of land, located at 525 West St. John Street, is owned by the Francia Family Trust. San Jose leaders agreed to buy the property for $2.9 million on Tuesday, using the money from the Trammell Crow settlement.

The plan is to use that land for parking in an effort to fulfill the city’s agreement with the Sharks. It can also serve as an interim supply of parking during the planned construction of the BART and High Speed Rail, city officials said Tuesday.

Though the property was appraised for $2.3 million, San Jose leaders agreed to buying it for $2.9 million partially because of what’s being dubbed the “Google effect” — land near the proposed development has skyrocketed in value.

But labor leaders and housing advocates said they’ve been excluded from the city’s private negotiations with the Internet giant. No official community meetings have been scheduled to talk about benefits Google might offer the city, they said, but the city keeps buying land near the project.

“We’re particularly concerned the residents have been shut out of the city’s negotiation process,” said Jeffrey Buchanan, policy director of Working Partnerships USA, on Tuesday. “We think this is wrong given the number of public benefits the city is being asked by Google to deliver for this project. We need to consider not spending public dollars until we have a discussion about public benefits.”

The source of funding for the former Milligan News site, according to city documents, is a building and structure construction tax fund. The Francia Family land will be purchased using money from a city parking fund — comprised of Trammel Crow’s settlement.

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