Judge Finds No Issue in Bid to Block Sale of Historic Post Office

SAN FRANCISCO (CN) – In a victory for opponents of the U.S. Postal Service’s planned sale of the historic Berkeley, California, post office, a federal judge found Monday that the government could not prove a city ordinance blocking the sale is unconstitutional.

In 2011, the Postal Service announced plans to sell the 104-year old neoclassical building, designed by famed architect Oscar Wenderoth and listed as a National Historic Landmark in 1981. In September 2014, the Postal Service struck a deal to sell the building to urban developer Hudson McDonald, which planned to turn it into a Target store.

That same month, Berkeley passed a new zoning ordinance restricting the use of the post office building to civic and nonprofit purposes. The “overlay”, as it’s called, applies to only to nine parcels of land within five blocks centered around Berkeley’s Civic Center Park.

By December 2014, the deal had fallen through. In its federal lawsuit against the city, the Postal Service said Hudson McDonald backed out because the overlay had so devalued the property that the developer said it was “destroyed and worth very little.”

At a one-day bench trial in April, Justice Department attorney Julie Berman said the city’s zoning overlay discriminated against all potential buyers of the property.

Not so, said U.S. District Judge William Alsup. In a 9-page findings of fact and conclusions of law issued Monday, Alsup noted that the Postal Service could still have sold the building, albeit at a diminished value. He cited the Postal Service’s own experts, who appraised the building’s current value at over $6 million. Instead of working with Hudson McDonald or any other perspective buyers, Alsup said, the Postal Service just took it off the market.

Had it presented evidence that the overlay completely frustrates any potential sale, perhaps things would have gone differently.

“For example, the USPS could hypothetically have proffered evidence – not merely attorney argument and unsubstantiated insinuation – that something about the grand scheme of its nationwide operational plan makes it impossible, as a practical matter, to sell the post office below a certain price. But it did not do so,” Alsup wrote. “The USPS could also hypothetically have proffered evidence that no one would purchase the post office with the overlay in place, and any efforts to strike a reasonable deal would have been futile. But the USPS did not even try. It simply took the post office off the market and filed this lawsuit instead, thereby foreclosing what might have been persuasive proof of its claim.”

Alsup also attacked another of the Postal Service’s arguments; that the overlay unfairly singles out the nine parcels in Berkeley’s civic center district for stricter regulation than other historic properties in the city.

“Aside from pointing out that ‘other historic properties or historic districts in the city’ exist, however, the USPS has supplied no evidence or analysis sufficient to show how those other properties and districts could be considered ‘similarly situated’ to the post office in any meaningful sense,” he wrote.

Alsup added, “Of course, every ‘historic district’ – or any other discrete area – has to stop somewhere. Its boundaries must end on some block or street. It is nothing more than a truism that any regulation purporting to govern a specific area will affect properties right up to the boundaries of that area but not the properties immediately beyond. The USPS’s protestations about this simple fact do nothing to advance its case.”

He said the nine parcels affected by the overlay make up a “cohesive ensemble,” finding them part of “the unique historic and cultural significance they hold within the city.”

The Department of Justice declined to comment on Alsup’s findings, and attorneys for the city did not respond to a request for comment.

The ruling is a win for California history buffs, art lovers and building preservationists alike.

Harvey Smith, author of “Berkeley and the New Deal” and president of the National New Deal Preservation Association’s board, said by phone Monday that he was pleased Alsup invoked the historic heritage of the Berkeley Civic Center in his ruling. Smith wrote about the subject in a piece for the Berkeley Daily Planet titled “The Long History of the Berkeley Civic Center.”

According to Smith’s article, in 1915, Berkeley’s first city-planning act drafted by Charles Henry Cheney envisioned a space called “Liberty Square” that included the newly built post office. In 1940, voters passed a bond measure that established Civic Center Park, an historic district that includes the park, the post office, Veterans Memorial Building, the Civic Center Building and the Berkeley Community Theater.”

“I’m happy. I think it’s the right decision,” he said. “If you know the history, what the history of that part of Berkeley shows us is this has been a concept and something that the city has strived for in terms of maintaining it as a viable civic core. So that certainly is reflected in the ruling.”

Smith noted that under the 1970 Postal Reorganization Act, the Postal Service could have disposed of the unused post office by giving it to another public entity, the way Hamilton Field – a former Air Force base in nearby Novato – was reclaimed by the city for public use.

“If these are really properties the Postal Service doesn’t want, given that the taxpayer has paid for them, they should revert back to us. That would be the ethical thing,” he said.

A local historian, Smith was drawn to the fight not just by his love for the building, but by its connection to the New Deal. It houses two pieces of New Deal-financed art; a limestone relief sculpture by David Slivka called “Pony Express – Early California” and a mural by Suzanne Scheuer titled “Incidents in California History.”

“The Postal Service, in trying to sell off these buildings, is selling off a legacy that everyone really owns and most people really admire and treasure,” Smith said. “To see this happening with our historic post offices is personally really infuriating.”

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