Title
Public Hearing to Consider a Call for Review of the Planning Board’s Approval of PLN24-0059 Use Permit to Allow Outdoor Research and Development, and Outdoor Storage, and Design Review for an Approximately Twenty-Five Foot Tall, 5,500 Square Foot Hydraulic Test Facility on the North Side of Building 23 at 2401 Monarch Street; and
Adoption of Resolution Approving a Use Permit to Allow Outdoor Research and Development, and Outdoor Storage, and Design Review for an Approximately Twenty-Five Foot Tall, 5,500 Square Foot Hydraulic Test Facility on the North Side of Building 23 at 2401 Monarch Street.
This project is categorically exempt from environmental review pursuant to California Environmental Quality Act (CEQA) Guidelines Sections 15301 - Existing Facilities, 15303 - New Construction or Replacement of Small Structures, and 15332 - Infill Development; none of the exceptions to the categorical exemptions apply. As a separate and independent basis, the project is also exempt from CEQA pursuant to the streamlining provision of Public Resources Code Section 21083.3 and Section 15183 of the CEQA Guidelines; no further environmental review is required because the project is consistent with the adopted zoning for the area, the impacts of which were considered in the Alameda Point Project Final Environmental Impact Report adopted by the City Council on February 4, 2014. (Planning, Building and Transportation 20962710)
Body
To: Honorable Mayor and Members of the City Council
From: Jennifer Ott, City Manager
EXECUTIVE SUMMARY
On April 22, 2024, the Planning Board held a public hearing and unanimously approved Resolution No. PB-24-07 for a Use Permit to allow outdoor research and development and outdoor storage, and Design Review for an approximately 25-foot tall, 5,500 square foot hydraulic test facility on the north side of Building 23 at 2401 Monarch Street (Exhibit 1). The approval will facilitate expansion of Natel Energy’s testing platform for the fish-safe hydraulic turbines the company has been developing at Alameda Point for over 14 years.
On May 2, 2024, Councilmembers Herrera Spencer and Daysog filed a Call for Review of the Planning Board’s decision (Exhibit 2). The call for review includes:
• The Planning Board hearing was not properly noticed in that one of the affected tenants received late notice,
• Natel’s test facility is incompatible with Spirits Alley due to view blockage,
• The project generates vibration, excessive noise and is not compatible with the United States Fish and Wildlife Service Biological Opinion (Exhibit 3) protecting the endangered California Least Tern colony on the former airfield,
• View impacts for tenants across the street, especially Building 43 Winery, are an unacceptable reduction in the value of those leases, and
• The findings made by the Board were inadequate.
Staff contends the Planning Board hearing was properly noticed according to Alameda Municipal Code (AMC) and CA Government Code. The Board properly found that (a) the project as conditioned is compatible with the neighboring land uses at Alameda Point and Spirits Alley, (b) view impacts are minimized to the extent feasible, and other tenants’ leases do not contain rights over views or air or light on other properties, (c) the proposed project does and will continue to comply with the requirements of the Biological Opinion, and (d) the application met the required findings.
BACKGROUND
Natel Energy is a climate technology company that designs fish-safe hydraulic turbines. Natel was one of the first clean technology companies to locate at Alameda Point. After sharing space in the former control tower and renting space in a nearby hangar, Natel leased 2401 Monarch Street in 2015 and their investors purchased the property in 2018.
Natel uses the operations yard on the north side of its hangar (Building 23) for research and development, equipment staging, and outdoor storage. In addition to support equipment and a fish tank system, the R&D activity uses a small test facility (Mini Loop) and a larger scale test facility (Big Loop) to simulate various conditions to test its fish safe turbine designs as outlined in its Operations Plan (Exhibit 4). Natel seeks to expand the Big Loop by adding a second test loop with overhead piping and a 20,000-gallon reservoir as shown in its Design Review Plans (Exhibit 5).
On April 22, 2024, following a public hearing, the Planning Board unanimously conditionally approved a Use Permit to allow outdoor research and development and outdoor storage and conditionally approved Design Review for an approximately 25 foot tall,5500 square foot hydraulic test facility on the north side of Building 23 at 2401 Monarch Street (Exhibit 1).
Call for Review Process (AMC 30-25)
AMC Section 30-25 provides that any decision of the Board may be called for review by two members of the City Council. Calls for review must be scheduled for a public hearing and decision by the City Council no later than the third regularly scheduled and held meeting following submittal of the call for review. The June 4, 2024 public hearing date is the third regularly scheduled City Council meeting following the call for review. AMC Section 30-25.4.c further stipulates that all costs associated with the call for review including staff time, technical assistance, and noticing the public hearing shall be funded by the General Fund and shall not be charged to the project applicant. The costs associated with the call for review are discussed below in the Financial Impact section of this report.
The City Council reviews the Planning Board’s decision de novo. This means that the City Council may consider the introduction of all pertinent material, including all documents constituting the administrative record. At the hearing, any party or person may appear in person or by agent or attorney to provide testimony. The City Council may reverse or affirm, in whole or in part, or may modify the decision of the Planning Board.
DISCUSSION
Call for Review Arguments
The remainder of this report summarizes the arguments made in the call for review, followed by staff’s response.
Call for Review Argument #1 - Insufficient Notice. The call for review claims that “the City failed to provide sufficient notice to the City of Alameda’s (City) long-term tenants within 300 feet of the subject property, including directly across the street.” The call for review adds that staff emailed the tenant directly across the street (Building 43 Winery) four days before the Planning Board meeting “which they [the tenant] didn’t open until the day of the hearing,” noting the tenant’s demonstrated interest in preserving views from its business.
Staff Response. Pursuant to AMC 30-21.7 and CA Government Code Section 65091, the Planning Board public hearing on Natel’s application required:
• Posting at least one notice on the property
• A newspaper ad
• Mailing notice to property owners as shown on the latest County assessment roll of all properties within 300 feet of the subject property.
Under both State law and local regulations, failure to receive notice does not invalidate a decision. In addition to posting two notices on Natel’s property near the sidewalk, publishing a newspaper ad, and mailing notice to property owners within 300 feet, staff routinely attempts to mail courtesy notices to tenants/occupants within 300 feet of the project site. Planning staff mailed ten public notices after obtaining available addresses from County Assessor’s data. Three tenants across the street from the Natel site did not receive a mailing because the addresses were not in the database.
Four days prior to the Planning Board meeting, Base Reuse staff provided Planning staff several e-mail addresses of nearby businesses, including those for Building 43 Winery, and suggested staff send the notice of public hearing directly to those tenants. After staff emailed the notice directly to the tenants, Planning staff received written correspondence from the business tenant of Building 43 Winery one day prior to the Planning Board meeting, where the owner submitted written comment on the item which staff forwarded to the Planning Board before the hearing for its consideration. The tenant also gave verbal public comment at the hearing for the Planning Board to consider prior to its deliberations. Additionally, staff were conscious of recent City Council and community discussions around views and promoting Spirits Alley businesses when reviewing the project application. The approved site plan and conditions of approval were crafted after carefully considering these factors.
Call for Review Argument #2 - View Blockage. The call for review states that the “additional equipment will significantly block views of the San Francisco skyline from the City’s long-term tenants…, of which the views are a significant part of the value of the leases.” The call for review adds, “the projected height of some of [the] new equipment is 25 feet.”
Staff Response. The view in question is not part of any city-adopted view corridor nor is it a character defining feature of the NAS Alameda Historic District. The project does include an expansion of the existing already 25-foot-tall test equipment. The approved plans and conditions of approval reduce and consolidate as much as possible Natel’s storage and support equipment near the hangar and include a “no-build” area at the front of the site adjacent to the easement to maximize views from Monarch St. while accommodating the most critical elements of Natel’s operations. The 2401 Monarch property also has a 32-foot-wide access easement along the northern property line where no material may be placed. Because the United States Fish and Wildlife Service (USFWS) Biological Opinion prohibits anything taller than four feet on the west and south sides of Building 23, the operations yard on the north side of the hangar is the only viable location for this equipment. If the City Council wishes to formally protect certain views in this area, it would need to direct staff to return to City Council with an AMC amendment.
Call for Review Argument #3 - Unpermitted Use & Structure. The call for review references staff’s description at the Planning Board hearing of the existing outdoor use as “legal non-conforming” and asks for an explanation of how that term applies in this case.
Staff Response. AMC 30-20.1.c states, “If any nonconforming use is abandoned (not actively used), or voluntarily or by legal action caused to be discontinued for a period of one (1) year or more, then any subsequent use of the property shall be in conformity with the provisions of this article.” Through at least February 2016, the prior tenant of 2401 Monarch Avenue (Matson) was continuously using the outdoor areas of the site for operations and storage. By at least August 2016, approximately six months after the prior tenant had discontinued the outdoor storage, Natel occupied the site and continued outdoor storage and testing operations, including the smaller testing platform, water tanks and storage containers along the northern portion of the property. Since less than a year had passed between outdoor uses by each tenant, the existing legal non-conforming outdoor use had not been abandoned per the provisions of the AMC.
Call for Review Argument #4 - Noise, Vibration, and Compliance with USFWS Biological Opinion. The call for review raises the question of whether the existing test equipment complies with the US Fish and Wildlife Service Biological Opinion protecting the endangered California Least Tern, highlighting factors such as noise levels, vibration, structure heights, and glare.
Staff Response. The project is compliant with the Biological Opinion and the Planning Board approval requires that the applicant continue to comply with the Opinion. The Biological Opinion places different restrictions and obligations on different areas of the former Navy base. Building 23 is in what is referred to as the Civic Core Area. The outdoor areas at 2401 Monarch are all in either Zone 1 or Zone 2. West and south of Building 23 is in Zone 1, which prohibits new structures greater than four feet in height. The area on the north side of Building 23 is in Zone 2, which allows new structures and additions up to the height of the existing adjacent building(s). Building 23 is 44 feet in height and the existing and proposed equipment is 25 feet tall.
Further, the Biological Opinion does not place noise restrictions on uses in the Civic Core Area. The project is required to comply with the Alameda Noise Ordinance (AMC Section 4-10). The Biological Opinion does contain a discussion of construction noise impacts associated with the proposed VA facility to the northwest of the site. The Planning Board approval included a condition of approval limiting noise impacts at the Least Tern colony site during the breeding season to no more than ten percent over the baseline of 55 decibels (as measured in 2009).
Call for Review Argument #5 - Building 43 Winery Lease Impacts. The call for review states in several instances that views of the San Francisco skyline from tenants’ businesses on the east side of Monarch Street, especially Building 43 Winery, are important assets for those businesses and a “significant part of the value of the leases.” Further, the call for review states that Building 43 Winery took possession of its space in June 2014 and that when Natel took possession in November 2015 the side yard was “vacant.” The call for review states that the “unpermitted structure” was added years later after the building was bought around 2017.
Staff Response. The lease agreement between the City and Building 43 Winery (Steeltown Winery) plainly states, “No rights to any view or to light or air over any property, whether belonging to Landlord or any other person, are granted to Tenant by this Lease.” Further, in June 2014 when Building 43 Winery took possession of 2440 Monarch Street, the outdoor areas surrounding 2401 Monarch were covered with shipping containers from the prior tenant (Matson). These containers were still present as late as February 2016 when Natel took possession of the site. Natel’s use of the outdoor areas was established by August 2016 with numerous storage containers and its “Mini-Loop” test facility. The larger “Big Loop” testing platform was in place by September 2017. Natel’s investors purchased the property at 2401 Monarch Street in 2018. The lease between the City and Building 43 Winery is a landlord-tenant relationship, and consideration of lease terms for one property need not be considered as a factor when approving a Use Permit and Design Review on another property.
Call for Review Argument #6 - City Council Should Review Planning Board Findings and Conditions. The call for review takes issue with the required Use Permit and Design Review findings made by the Planning Board, including:
• Argument: The CEQA infill exemption is incorrect because historically there were no structures “like this” between the hangars and the project does not comply with the requirements of the Biological Opinion (protecting the California Least Tern.)
o Staff Response: The project meets all five criteria for an infill exemption (CEQA Guidelines Section15332). That this type of structure did not exist here previously is not relevant to the CEQA determination. The historic structure is not adversely affected by activity taking place outside of it. The project also meets the requirements of the Biological Opinion as addressed above in response to Argument #4. Further, this project is also categorically exempt from environmental review pursuant to CEQA Guidelines Sections 15301 - Existing Facilities and 15303 - New Construction or Replacement of Small Structures; none of the exceptions to the categorical exemptions apply. As a separate and independent basis, the project is also exempt from CEQA pursuant to the streamlining provision of Public Resources Code Section 21083.3 and Section 15183 of the CEQA Guidelines; no further environmental review is required because the project is consistent with the adopted zoning for the area, the impacts of which were considered in the Alameda Point Project (APP) Final Environmental Impact Report (FEIR) adopted by the City Council on February 4, 2014.
• Argument: The call for review asserts that the project is not compatible with Spirits Alley, in large part because of the view impacts.
o Staff Response: The Planning Board found, and staff agrees, that the project is compatible with the surrounding land uses and as conditioned it balances General Plan and Economic Development Strategic Plan policies and overall community needs and desires.
CONCLUSION
The Planning Board held a public hearing that was appropriately noticed and its unanimous approval of the Use Permit and Design Review was based on careful examination of the project’s compliance with CEQA, the General Plan, the Economic Development Strategic Plan, Alameda Point Zoning District regulations, and USFWS Biological Opinion restrictions. The Board adopted findings in support of its action, which findings were supported by the evidence in the record, and imposed reasonable conditions of approval to address potential impacts and ensure consistency with adopted guidelines and standards.
ALTERNATIVES
Alternatives available to the City Council include reversing or affirming, in whole or in part, or otherwise modifying the decision of the Planning Board.
FINANCIAL IMPACT
Pursuant to AMC Section 30-25.4, all City costs associated with the call for review including staff time, technical assistance, and noticing the public hearing shall be funded by the General Fund and shall not be charged to the project applicant.
Staff estimates the costs for preparing this call for review, including staff time, technical assistance, attorney review, and public noticing/correspondence and attendance at the public hearing to be approximately $14,300, which shall be charged to the General Fund.
MUNICIPAL CODE/POLICY DOCUMENT CROSS REFERENCE
Natel’s project is consistent with General Plan policies to promote a green economy, support the preservation and adaptive reuse of the NAS Alameda Historic District and meets the criteria of the Alameda Point Zoning District. Approval of the Use Permit and Design Review is consistent with the Strategic Plan priority to Invest in Transportation, Infrastructure, Economic Opportunities, and Historic Resources.
ENVIRONMENTAL REVIEW
This project is categorically exempt from environmental review pursuant to CEQA Guidelines Sections 15301 - Existing Facilities, 15303 - New Construction or Replacement of Small Structures, and 15332 - Infill Development; none of the exceptions to the categorical exemptions apply. As a separate and independent basis, the project is also exempt from CEQA pursuant to the streamlining provision of Public Resources Code Section 21083.3 and Section 15183 of the CEQA Guidelines; no further environmental review is required because the project is consistent with the adopted zoning for the area, the impacts of which were considered in the APP FEIR adopted by the City Council on February 4, 2014.
CLIMATE IMPACT
Natel develops high-performance hydro turbines that protect migratory fish. Hydro power provides stable, on-demand, emissions-free electricity, including more than half of Alameda’s power needs. Supporting companies like Natel supports Alameda being a hub of innovative climate technology firms.
RECOMMENDATION
Hold a public hearing to consider a Call for Review of the Planning Board’s approval of PLN24-0059 Use Permit to allow outdoor research and development, and outdoor storage, and design review for an approximately twenty-five foot tall, 5,500 square foot hydraulic test facility on the north side of Building 23 at 2401 Monarch Street; and
Adopt a resolution approving a Use Permit to allow outdoor research and development, and outdoor storage, and design review for an approximately twenty-five foot tall, 5,500 square foot hydraulic test facility on the north side of Building 23 at 2401 Monarch Street.
Respectfully submitted,
Allen Tai, Planning, Building and Transportation Department Director
By,
Steven Buckley, Planning Services Manager
Brian McGuire, Planner II
Financial Impact section reviewed,
Margaret O’Brien, Finance Director
Exhibits:
1. Planning Board Resolution PB-24-07
2. Call for Review by Councilmembers Herrera-Spencer & Daysog
3. USFWS Biological Opinion
4. Operations Plan
5. Design Review Plan