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Environmental cleanup at Hunters Point has started and stalled repeatedly over the years, alternately plagued by budget fluctuations and prodded by activist lawsuits. Finally, with a shove from San Francisco's congressional delegation, the military began a serious effort to clean up its mess in the mid-1990s, in anticipation of transferring the property to the city.
The deal to develop the former shipyard property was struck a few years later, when two things happened. In 1997, the San Francisco Redevelopment Commission, whose members are appointed by the mayor, decided to convert the shipyard property to civilian use by hiring a master developer, meaning that the agency would hand off the property to one developer to plan and create a new community. Later, the commission selected Lennar, under what might be called curious circumstances.
Lennar Communities is a part of the Miami-based Lennar Corporation, one of the nation's largest homebuilders. In recent years, the company has also ventured into the military base rehabilitation business, building new communities on former Department of Defense land.
In 1998, the San Francisco Redevelopment Agency invited developers to bid on the Hunters Point project, and then hired the financial services firm of KPMG, LLP to review the bids. Lennar partnered with Mariposa Management, a San Francisco developer, and Luster Inc., a local construction management firm, to form Lennar/BVHP Partners. (Mariposa and Luster had bid on the project as a separate entity before combining with Lennar.) KPMG recommended another bidder, Forest City Enterprises Inc., which had partnered with Oakland-based developer Em Johnson Interest, as the best choice for the job. (Another group led by Mission Bay Developer Catellus Corp. also was a finalist.) "Forest City has the most relevant urban, large-scale mixed-use experience and an established track record of economic revitalization of blighted areas," KPMG stated in its recommendation.
But the San Francisco Redevelopment Commission, citing the supposed wishes of the community adjacent to the shipyard, chose the Lennar group, effectively ignoring its own consultant. The 1999 vote followed a parade of Bayview residents -- many of them well known as supporters of Mayor Brown -- to the commission's microphone, where they extolled the virtues of Lennar, which had spent many hours and much money wooing certain members of the community. The Redevelopment Commission's decision to go against its own consultant's recommendation caught the attention of the FBI, which was investigating city contracting abuses at the time. According to the San Francisco Examiner, FBI agents requested records related to the Lennar deal from the city's Human Rights Commission, but no charges were ever filed.
The Redevelopment Agency entered into an exclusive negotiating agreement with Lennar/BVHP, meaning that the city could no longer talk to any other developer about the shipyard. In exchange, Lennar began reimbursing San Francisco for its costs, including the time that city attorneys and staff members spent negotiating with the Navy for cleanup and transfer of the land and planning the development deal. This meant that the city was off the hook for much of the expense of the shipyard transfer -- and that Lennar was paying the salaries of the people who were representing the city in the deal.
While the Navy's cleanup dragged on long beyond any of its initial time estimates for transferring the shipyard property to city control (mostly because of unexpected environmental problems) city officials worked on the development plan with Lennar. So, now, the city has a plan, but no shipyard. Lennar has paid the city some $6.5 million, and spent another $13 million or so creating the deal.
And, it's fair to say, the developer wants to make its money back.
Years ago, the Hunters Point Shipyard was divided into six parcels for the purposes of transfer from Navy to city. Before the first shovel of dirt can be turned for development at the former base, the Navy has to finish cleaning up the property, and state and federal environmental regulators must approve the cleanup. But there's a problem: The Navy's cleanup plan is not necessarily in sync with the city and Lennar's development plans.
And that's only one of several basic development hurdles that still hinder any attempt to civilianize the shipyard.
As far as the Navy is concerned, a deal to transfer any shipyard property to the city hasn't been struck yet, according to Lee Saunders, environmental public affairs officer for the Navy's Southwest Division, which oversees the Hunters Point cleanup. The agreement that governs the transfer of base property, hammered out by city and federal lawyers, staffers, and community representatives, has not been signed, Saunders says, and the Navy still considers itself in negotiation with the city over such transfers.
Even when the transfer agreement is signed, the shipyard land where community facilities and retail space would be built -- the facilities and space that would bring the permanent jobs promised to the Bayview community in the first phase of development -- will not be available until Lennar builds and sells the houses that compose most of the project's first phase. Commercial and industrial space -- a more important source of future jobs -- is not included in this phase of development at all. And the Bayview Hunters Point Center for Arts and Technology -- a replica of a successful education, job training, and arts center in Pittsburgh that was once the crown jewel of the shipyard redevelopment plan -- tired of waiting for the Navy's cleanup to be finished and found a new home elsewhere.
Meanwhile, significant environmental questions remain unresolved, including those surrounding radiation contamination. Between 1946 and 1969, the shipyard was home to an applied radiological research laboratory involved in numerous experiments on the base, as well as every nuclear weapons test the U.S. military performed during that time. The Navy has not yet completed its Historical Radiation Assessment of the shipyard, which comprises years of research into possible locations and sources of contamination. A draft of the report in 2002 identified more than 100 radioactive substances -- from those whose effects last only seconds to those that remain poisonous for thousands of years -- used at Hunters Point Shipyard. Since then, Navy officials have found several areas where radioactive material was stored or used, information that will likely be included in the new report.
