Dealing with downtown’s 18 unreinforced masonry buildings is slow-going but starting to yield results, following City Council’s last-ditch effort in June to enforce liens on property owners who were noncompliant in retrofitting their buildings to local and state safety regulations.
Mayor Don Gage says the Council’s 4-3 vote to impose $10,000 monthly fines on URM buildings owners and others who at the time were delinquent on administrative citations is a way to get uncooperative property owners to come to the table.
“The fines are pretty extensive,” said Gage. “That got peoples’ attention.”
More than three months since the liens were approved, 14 owners of URM buildings (edifices deemed structurally unfit to survive a high-magnitude earthquake) have connected with the City in some way and are working towards a resolution, according to Gilroy Community Development Director Kristi Abrams.
Some are making preparations to move ahead with the retrofit work, which includes securing URM walls to the roof and floors in multi-story buildings, bracing parapets and repairing or removing façades. Others are talking about selling altogether.
“We have a lot of building owners [14 out of the current 18] who have started to talk to us and some who have already moved through the retrofit process,” Abrams said. “But there are a substantial number of owners [the remaining four buildings] involved in the process who have not.”
Those properties are 7515 Monterey St., owned by John Bartlett, Richard and Ann Bauden; 7491 Railroad St., owned by Lynette Hill; 7320, 7330 and 7340 Monterey St. (all one building) owned by Mark Casey and Elizabeth Potamianos; and 7760 Monterey St., owned by Hugo Hernandez, according to Gilroy Development Center Manager Lee Butler.
Three of those properties have been slapped with the maximum accrual of fines and penalties, which currently stands at $18,600 each, according to Butler. And those penalties will continue to accrue by $10,000 monthly if they’re not paid. That’s in addition to vacant building and commercial blight violations outlined in the City’s municipal code and fines for abandoned construction, or outstanding preexisting fines.
If the remaining five property owners “don’t do something with the building because it’s unsafe, they’re going to start getting fined,” Gage warned. “As far as I know, they’ve never come in and have just been ignoring our letters. The others have responded on some level, whether they’re seeking a permit or whether they’re doing engineering work. We’re happy to work with them. We’re not charging them fees to redo their buildings and the City is bending over backwards for them.”
“Bending over backwards” for URM owners is something Gage says the City has been doing for years when it comes to downtown’s vacant building conundrum dating back three decades. This includes numerous outreach meetings designed to foster collaboration; establishing a URM Task Force; drafting voluntary and mandatory retrofit requirements; and threatening numerous fines that were never imposed.
California’s URM Law established in 1986 requires cities located in the “seismic zone 4” – a historically active fault line which runs the length of the California Coast – to inventory their URM buildings, report the findings to the state and work on getting the buildings up to code. The rest is up to local municipalities.
Gilroy’s URM ordinance established in 2011 demands vacant URM buildings be retrofitted before they can be occupied by a business.
Butler identifies the URM blight as “one of the biggest issues, if not the biggest issue facing our downtown.”
But local developer and downtown advocate Gary Walton points out there is enough blight in downtown Gilroy to go around, and the blame should not rest solely on URM property owners.
He points to the condition of Gilroy’s alleys and streets, gateways to the community and landscaping on city property as other unaddressed examples.
“I understand what the City is trying to do, but I don’t think it creates the type of partnerships that are effective by making enemies out of [URM owners],” Walton said.
Property values have taken a hit, rent has increased and the overall look of the downtown area has suffered thanks to the City going beyond state law and drafting its “hammer approach” for noncompliant URM building owners, Walton argues.
He points to the City of Oakland, which reportedly studied eight different scenarios to deal with URMs and reported the type of approach implemented by Gilroy “had the least chance of success because it was too expensive,” Walton says.
The cycle of being buried beneath accruing fines while unable to generate rent from a tenant is exactly what many URM owners say is hindering them from moving forward.
Amit Patel, who owns two URM buildings with his partner Sunil at 7217 and 7525 Monterey St., was assessed non-URM fees and penalties for blight and abandoned construction in July exceeding $140,000, according to Butler.
“I am being unfairly targeted with outrageous penalties for blight and unfinished construction,” wrote Patel in a July 12 letter to City Council. “Why are only the select property owners in Gilroy being penalized so severely for issues that are not uncommon in Gilroy?”
Butler said the Patels have since worked out a formal payment plan with the City and have been diligently complying, so far.
Gage is sticking to his bottom line. The URMs and other downtown buildings that aren’t up to code pose the threat of lawsuits against the City, are an eyesore and “uninhabitable,” he said.
Either the owners can fix the buildings, tear them down or sell them and put the problems in someone else’s lap, according to Gage. Or, they can face the accumulating fines and the City will take care of the problem.
“When you try to attract people to downtown and they see a bunch of closed buildings, it’s like anything else,” said Gage. “If you go to a restaurant and you don’t see anybody in it, you think ‘gee, I wonder how the food is.’ That’s the same attitude people have when they start looking for space to put in a business.”
Walton doesn’t think the City’s approach has been – or will be – effective.
“Piling on more regulations obviously hasn’t worked. Maybe it’s time to try something else,” Walton said. “I don’t think the City understands they haven’t just punished URM property owners, they’ve punished every property owner downtown.”
