Groups claim Mayor Butt excluded public from Point Molate development decision

This is the third story in a four-part series about how Richmond Mayor Tom Butt navigates the conflicts that arise from his roles of public official, business owner and real estate investor. 

In a 2018 lawsuit, Richmond Mayor Tom Butt and the City Council are accused by two environmental groups and four community activists of circumventing the law aimed at ensuring government transparency in order to push a controversial development through the city’s approval process. Under certain circumstances, that development could result in more business for the mayor’s architectural firm. 

The suit is among three filed in the past four years alleging that Butt inappropriately steered controversial land use decisions. On Wednesday, Richmond Confidential looked at the PowerPlant Park cannabis growing case in which a developer accused Butt of meddling behind the scenes in zoning decisions he was barred from voting on because of a conflict of interest. The mayor, who also is a business owner and real estate investor in Richmond, denies that claim and has said he goes out of his way to seek advice on when to recuse himself. “I really try to play it straight,” he said in an October interview. 

This story examines challenges to the City Council’s decisions that locked the city into an unpopular development plan for a highly contested and potentially lucrative shoreline property — Point Molate. 

Embedded in Point Molate’s landscape are several features that make it difficult and controversial to develop. Home to a ship fueling depot before the Navy bequeathed it to the city in 2003, the land is contaminated with remnants of fuel the Navy stored there. At the same time, portions of the point contain burial sites claimed by the Ohlone Native American tribe, as well as relatively undisturbed swaths of shoreline habitat — increasingly rare as the beach encircling the San Francisco Bay vanishes under developments. The area lies about 10 minutes northwest of Chevron’s Richmond refinery and holds a century-old complex of 35 buildings that once housed one of the world’s largest wineries. 

Given these constraints, what — and how much — to build at Point Molate has been arguably the most contentious issue in Richmond politics for nearly two decades. The biggest flashpoint is the question of housing. While supporters say building a housing development at Point Molate would ease pressure on the housing market in Richmond and in the greater Bay Area, and would include affordable-rate homes, opponents argue that building homes so close to the Chevron refinery, and with so few roads, would almost certainly endanger residents’ lives in the event of a fire. They also argue that any homes built there are unlikely to be truly accessible to low-income people, and that most of the land should be preserved as open space. 

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Point Molate — and particularly its historic district — has been a focus of Mayor Butt’s for years, said Andrew Butt, adding that his father has been drawn to the site since he arrived in Richmond in the 1970s. 

“One of the things he’s always been really passionate about is historic preservation, and … the whole thing out there is a historic district that’s sitting there, you know, literally falling apart,” Andrew Butt said.

But Mayor Butt’s vision of a revived historic district on Point Molate is antithetical to what open space advocates want because it would require housing, Andrew Butt noted. 

“One of the things that’s also really important to him I know [is] to have housing out there,” he said. “It recreates what was out there historically, which is a living, breathing community.” 

Andrew Butt said his father has worked for decades to see his vision of Point Molate come to fruition. “I think it is kind of a legacy project for him,” he said. 

In 2003, Richmond signed an agreement with developer James Levine to build a casino at Point Molate that would then be sold to the Guidiville Rancheria of California, a Pomo Native American tribe. But as Levine’s company, called Upstream, sought approvals from the federal government, environmental groups sued it in federal court, claiming that the deal between the company and the city didn’t meet state environmental protection rules. A 2010 settlement brought about more environmental protections.

A year and a half later, the project was back in court. Upstream was unable to clinch federal approvals, prompting the city to withdraw its support for the project. Levine and the tribe responded by suing Richmond, saying it had violated their development agreement.

Throughout Butt’s first term as mayor, he made ending the lawsuit and starting development at Point Molate top priorities: His 2017 and 2018 State of the City presentations highlighted “take back Point Molate and start developing it” and “settle Point Molate litigation” as goals for the year. 

By 2018, Butt’s first term as mayor was nearing its end, the lawsuit was in its sixth year, and tensions between community organizers and the city over Point Molate were at fever pitch. In mediation sessions and closed session council meetings, Butt and the City Council pushed through a development plan for Point Molate, violating open-meetings laws in the process, the latest lawsuit — filed by two environmental groups and four community activists — claims.

“Richmond’s Mayor and City Council, in unannounced serial meeting and in closed session, violated California’s open meeting ‘Brown Act,’…when they approved specific land development, purported to settle litigation over development of Point Molate,” the environmentalists said in a petition to the court.

The plan set a deadline for the city to sell or lease the property, and required any future developer to construct at least 670 housing units and restore all of the roughly 375,000 square feet of buildings in its historic district. The deal would be lucrative for Upstream and the tribe, which would get 50% of net revenues from the sale or lease of the property.

At some point during settlement conferences and closed session meetings that took place between Dec. 12, 2017, and April 12, 2018, the City Council agreed on the deal, court documents show. The Upstream lawsuit was settled when a federal judge signed off on the deal in April 2018. This effectively made the development plan enforceable in court.

Yet the deal still faced one seemingly insurmountable obstacle: It had to be passed by a majority of the seven-member City Council. The relentless community opposition to any housing on Point Molate meant it was unlikely that three council members would publicly side with the mayor and support the deal, said Norman La Force, an attorney and the CEO of one of the environmental groups that filed the lawsuit.

“We believe — I believe, and others too — that Mayor Butt was concerned that he would not get at least four votes to vote for the settlement agreement if it had to be disclosed publicly,” said La Force in an interview. “So he hid it. He hid it. Which is against the law.” 

Led by Butt, the City Council voted in favor of the settlement deal in one of the closed session meetings, the lawsuit contends. Under California law, the lawsuit claims, that vote was illegal. Passing settlement deals in closed sessions is almost never allowed, and city councils can’t make land use decisions in closed sessions either, the suit contends. The vote count — and any changes of heart by council members who had opposed housing on Point Molate publicly —  remained secret. 

In its legal response, the city said the closed session meetings were allowed because they fell within an exception the Brown Act makes for meetings about settling litigation.

The settlement deal passed, and the City Council announced it publicly during an open session at its April 17, 2018, meeting. Community organizers who had fought the plan were outraged. A month later, the two environmental groups sued the city, Butt, and the City Council.

In an online post, Butt called the environmental groups’ Brown Act claims “bogus.”

More than a year after disclosing the deal, the city sought an updated agreement from Upstream, the Native American tribe and the court. The city hoped the amended deal, which a judge approved in November 2019, would hasten the end of the environmental groups’ lawsuit, according to a report staff sent the City Council about the agreement. The amended judgment was almost identical to the original, with an important difference: a disclaimer that the deal “does not grant any entitlements for development at Point Molate.”

“Even though they say, ‘Oh no, those aren’t really entitlements — well, I’m sorry, they are. Just because you call something [one thing] doesn’t make it something that it’s not,” said Stuart Flashman, one of the attorneys representing the environmentalists.

The mayor scheduled a vote on the amended judgment in the City Council’s open session on Nov. 5. It was one of the most contentious sessions Richmond had seen. Among the 23 members of the public who signed up to testify on the vote was former Berkeley mayor Shirley Dean. 

“You made a private land use decision that closed off the public. Pure and simple, that’s against the law,” Dean said.

At one point, the mayor tried to order the shouting audience to leave the council chambers. The settlement deal passed on a 4-3 vote, with Nathaniel Bates, Demnlus Johnson III and Ben Choi joining Butt’s affirmative vote. Other than Butt, only Choi had been on the council when the original deal came up in closed session.

A year later, the city agreed to sell the Point Molate project to the Southern California-based developer Suncal, and Bay Area-based developer Orton Development was poised to acquire the historic district, including the winery.

If Suncal and Orton do break ground on Point Molate, they could seek out Interactive Resources — one of only two architecture businesses in Richmond and with special expertise in historic preservation — to rehabilitate its historic district. 

In the October interview, Mayor Butt said, “I have no economic interest in Point Molate. Never have.”

Andrew Butt said in a recent interview that the firm has not been hired for work on Point Molate, and could not consider it as long as the property was owned by the city. But if circumstances changed, the firm could consider it. 

“Let’s say I’m running the firm, and my dad’s not involved any more, and I’m not in any political position with Richmond and that conflict’s not there, would I entertain doing [that] work? Absolutely,” he said.

Asked if, under that scenario, he too would entertain the work, Mayor Butt said only, “No.”

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Last December, a judge dismissed the environmental groups’ lawsuit. 

Asked in an email about the lawsuit’s claims regarding his and the council’s conduct, Mayor Butt said only, “This lawsuit was decided in the City’s favor at trial court, but the petitioners have appealed it.”

Flashman, the attorney for the environmental groups, has confirmed that they are appealing the decision. And this spring, the council decided to stop defending the lawsuit only to reverse itself weeks later and vote to proceed with the city’s defense. 

If the city were to abandon its agreement to sell Point Molate to Suncal and Orton Development, it could be in for more legal trouble because the two companies could sue Richmond themselves.

Coming Friday: A development plan on the contaminated former Zeneca site spurs a citizen’s group to sue, claiming Mayor Tom Butt rushed the vote. (Read Part One: Lawsuits claim Richmond mayor steered development decisions in violation of ethics laws; and Part Two: Lawsuit claims Butt meddled in zoning decision that benefitted a client.)