Developing Appeal

Haig Mardikian's eight-year battle to build condos on top of Nob Hill

In San Francisco development politics, as in life, what goes around comes around — and around, and around.

Consider the case of 959 Powell St., the condominium development proposed for that part of Nob Hill where luxury hotels give way to the kind of apartment buildings whose fire escapes are permanently festooned with laundry. For eight years, Haig Mardikian — a socially prominent descendant of one of San Francisco's pioneer families, president of the Downtown Association, and a member at various times of the Redevelopment Agency and the state's Little Hoover Commission — has sought permission to build a 99-unit condo complex on the block of Powell between Sacramento and Clay.

For most of those eight years, neighborhood groups have fought the development, saying that the condominiums will displace the low-income residents of the existing building at 959 Powell, a gray-brick affair that looks out onto the empty, well-rocked Mardikian lot lying between it and the limestone edifice of the tony Fairmont Hotel.

It's a classic San Francisco battle, a long tug of war between developers and neighborhood groups. But now the long-dormant matter of 959 Powell has become a cliffhanger. On Jan. 10, which comes two days after Willie Brown is sworn in as mayor of San Francisco, the obscure but powerful Board of Permit Appeals (BPA) is scheduled to reconsider the 959 Powell case, and possibly make things a little easier for the developer.

The developer's attorney and the president of the Board of Appeals say the rehearing is a matter of fairness; opponents of the project call it a last-minute gift from the departing mayoral administration of Frank Jordan to a powerful supporter.

And the office of the incoming mayor has said that replacing the Board of Permit Appeals members, all of whom have been appointed by outgoing Mayor Frank Jordan, will be one of Brown's top priorities, out of an interest in staving off hasty last-minute hearings on controversial matters. But whether the new BPA will be in place before the Jan. 10 hearing date is up in the air: “I can't give you a firm date,” says P.J. Johnston, Brown's press secretary.

“All we're trying to do is to pursue what we think the law requires and our rights under the law in an orderly, timely basis,” says attorney Michael Burke, who is representing Mardikian in the matter. “And there's no question in my mind at all what the law says.”

“I feel that there are a lot of questions in the handling of it,” says Wayne Alba, president of the Board of Permit Appeals. “It's worth looking to make sure that it was in fact the right thing to do. It seemed like it was an unfair handling of the matter.”

Nonsense, says attorney Sue Hestor, who is representing the neighborhood groups. “They're trying to give a last-minute gift to Haig Mardikian, to put a fine point on it,” says Hestor. “[Jordan]'s appointed people have a certain attitude towards property rights, and it's their chance to give some last-minute little gifts.”

The chronology of the case — which thus far has spanned the mayoral administrations of Dianne Feinstein, Art Agnos, and Frank Jordan — is as follows: In 1987, the San Francisco Planning Department issued a “negative declaration” on the project, a governmental opinion that there would be no sufficient impact on the environment. The Planning Department and the Department of Public Works then issued discretionary approvals for the project. In November 1988, Mardikian and his partner, Taldan Investments, pulled the actual building permits. The Chinatown Resource Center and other community groups objected, and appealed the building permits to the Board of Permit Appeals. The BPA heard the objections and overturned the permits. Mardikian and Taldan went to court to get the permits reinstated, and the judge ruled that the BPA should direct the developers to conduct an Environmental Impact Report (EIR) on the project. In 1991, the BPA ruled that the EIR on 959 Powell should include a study of five alternatives, including not tearing down the 12-unit low-income building on the lot, building a smaller condo complex, and complying with all building and zoning laws.

And since 1991, that's pretty much where the project has been: in EIR limbo. What Mardikian is asking the Board of Permit Appeals to do now is to narrow the scope of the required EIR to study only traffic and the alternatives of building either no project at all or a 50-unit building.

“I don't know what motivates people and I don't want to put thoughts into people's minds, but when the Board of Permit Appeals the first time around was scoping the EIR, they weren't focusing on environmental issues,” says attorney Burke.

Narrowing the scope of the EIR will make it less expensive for the developer, says Burke. But Hestor says that the board's 1991 determination of what the project's EIR should study should continue to be binding.

“My clients took great pains to put on their case about the impacts of the project and the scope of the proposed EIR in the Board proceedings, particularly in oral testimony at the hearings. None of the current commissioners participated in those proceedings. None of you have reviewed the complete record on this matter,” Hestor wrote to the board in November. “Mr. Mardikian's request is more than four years too late.”

In fact, the amount of time that this case has been before the Board of Permit Appeals is unusual, says Deputy City Attorney Judith Boyajian, who is handling the matter for the city.

“It's never happened before in my memory,” she says. “The whole case is very unusual, I have to say. It's been open for so long, it's straddled two (Permit Appeals) boards and maybe will be going onto a third board.”

There's a danger in that, she says. “If this board can undo what was done in 1991, I don't see what prevents a Mayor Brown board from undoing what this one did. There's no end to it,” she says. “In administrative process, the idea is that there's a finality, and this one seems to be going on and on.”

But Board of Permit Appeals President Alba doesn't agree.
“We're just trying to clear the deck, so to speak, so that the new board would not have to deal with these problems the same way we had to deal with it. Because it's sort of unfair for everybody.

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