(2007-2008) GM BUYS FREMONT AUTO MALL PROPERTY; CITY
COUNCIL CHASTISES GM ABOUT SIGNER TREATMENT
On December 3, 2007, according to public records GM completed the $13,500,000 purchase of the two-parcel FAM property for which it had contracted in 2006. GM then submitted a rezoning request to the City showing an all-GM brand facility with multiple showrooms and a single service department, thus implicating one owner for all GM brands. GM’s facility plan was virtually identical to my 1991 plan that GM rejected. On December 24, 2007, a Fremont Pontiac-GMC salesperson told a customer that Fremont Pontiac-GMC would be “taking over” Signer Buick-Cadillac, a statement consistent with others that had stemmed from the dealership for some time.
In March 2008, the IRS requested records relating to my 2005 personal tax return. In June 2008, the Revenue Agent presented me with a tax assessment of approximately $111,000 for the 2005 tax year. See Expanded Details, “(2007-2008) Second IRS Audit.”
On June 10, 2008, GM resubmitted its Fremont Auto Mall plans and rezoning request to the City Planning Department. The plans were revised from the original single dealership to two separate dealerships, with one being a “duplex” type facility housing an undisclosed brand (obviously Chevrolet based on design elements) and Saturn, and the second one a smaller “future” dealership. GM Minority Dealer Development program dealer Inder Dosanjh, who purchased Saturn of Fremont in April 2008, was to operate the Saturn dealership, and most likely the undisclosed brand. The “future” dealership could only have been intended to house Buick-Pontiac-GMC-Cadillac once GM had successfully engineered my demise. It appears that GM may have split the original single operation into two separate ones so it could move forward with the Saturn/Chevrolet facility so it wouldn’t have to wait till I was gone. As Mr. Dosanjhwas now the second apparently favored dealer in the Fremont-Newark saga (in addition to Mr. Okenquist), and Mr. Okenquist’s Fremont P-G was reportedly suffering financial difficulties, GM never revealed to me in mid-2008 which of them it intended to operate the “future” dealership.
GM’s Fremont Auto Mall rezoning request came before the Fremont Planning Commission on August 28, 2008, where a GM Real Estate representative and Mr. Dosanjh spoke for GM. The matter then came before the Fremont City Council on September 23, 2008, where only the GM Real Estate representative spoke for GM. As in 2006 GM rejected my request to keep its dealers in Newark and avoid leaving me in a ghost town, I presented my concerns to both Fremont City bodies. During the time for public comment at each meeting, I presented my situation and two messages to the members: 1. GM changes its mind frequently, and 2. If the City approved rezoning and GM abandoned Newark, the actions could destroy everything I had ever worked for. After learning of GM’s history with the City of Fremont and me, most members of each body publicly chastised GM about the way it had treated me, including one City Council member who commented that my case is material for a 60 Minutes expose’, followed by another’s suggestion that I should contact documentary producer Michael Moore. Despite their obvious displeasure with General Motors, both bodies approved the rezoning in the interest of the community due to the tax revenue benefits. It should also be noted that State Assembly Member Alberto Torrico sent a letter to Western Region General Manager Susan Docherty, who was in transition to Buick-Pontiac-GMC General Manager at the time, urging resolution with me and offering assistance. I received no confirmation from GM of the letter, and Mr. Torrico never mentioned that he had received a response. Click on the links for additional information and links to the webcasts that provide viewing of the Fremont Planning Commission and City Council meetings.
Fremont Planning Commission Meeting August 28, 2008
Following is a transcript of statements by various people at the Fremont Planning Commission meeting on August 28, 2008. People quoted below include Planning Commissioners David Bonaccorsi, Dirk Lorenz, Dan Lydon, Yogi Chugh, Sue Chan, and Dr. Rakesh Sharma. Commission Chairman Rick King was not in attendance at the meeting. Also speaking were GM World Wide Real Estate Regional Manager David Frederickson, and GM Dealer Inder Dosanjh.
A webcast of this meeting can be viewed at Fremont Planning Commission 8/28/08 (mms://198.199.140.33/PCMeetings/PCMtg080828.wmv). Times shown below after some names are the amount of time into the Planning Commission meeting, as noted on the webcast time monitor. On the webcast, the segment playing can be advanced to the times shown after names below using the horizontal slide bar near the bottom of the webcast window.
Color highlighted comments for quick reference. All are also in italics.
Green = Comments of interest relative to Signer Buick-Cadillac
Red = Inder Dosanjh comments
- David Frederickson (1:01:15): Mr. Frederickson gave a short presentation of GM’s proposal and asked for the Commission’s approval.
- David Bonaccorsi (1:03:15): … “My understanding is 20 years ago GM turned down the opportunity to go to the Auto Mall. What’s different in market conditions today that weren’t present in your evaluation 20 years ago that’s going to make it succeed?”
- David Frederickson (1:04:29): “My employment with General Motors spans 4 years. I was not involved in the original process so I’m not informed on that issue and really can’t respond knowledgeably to your question. I apologize.”
- David Bonaccorsi (1:40:39): “OK. Um, you indicate a four-year time horizon in order to construct the new dealerships. Is that correct?”
- David Frederickson (1:04:48): “No, I don’t think so.”
- David Bonaccorsi (1:40:50): “OK, I thought the project indicated it was about four years you’d be able to, if you got the entitlements it would take about four years to…”
- David Frederickson (1:04:57): “No, our intention for the initial development would be to commence construction immediately this fall and, uh, we’re looking at opening operations mid to late summer of 2009, ideally.”
- David Bonaccorsi (1:05:14): “Which dealerships in town are you asking to move out there?”
- David Frederickson (1:05:16): “Um, with all due respect I can’t disclose the details of our network planning. The information’s confidential. I can disclose that the Saturn dealership is one that we intend to (unintelligible).”
- David Bonaccorsi (1:05:30): “You are award of the 5-mile radius rule… in terms of limitations of having dealerships within certain radii.”
- David Frederickson (1:05:39): “I think in the State of California it’s actually a 10-mile radius, but yes, I’m familiar with the statute.”
- David Bonaccorsi (1:05:47): “And there are a number of dealerships within that 10-mile radius currently. I think one of them is Brunelli’s Central Chevrolet. We’ve got a Saturn dealership in Newark. And we’re going to hear from Mr. Signer later on. One of the things we have to evaluate is, and I should also disclose that I’m a big proponent of the Auto Mall concept so I understand the economies of scale and the synergy of the number of dealerships there, but…” (discussed sales tax impact.) (Miscellaneous discussion about future Saturn product.)
- Dirk Lorenz (1:08:23): …“How many dealers do you desire to eventually accommodate at this site, total?”
- David Frederickson (1:08:28): “Again, the details of that, not only are they currently unknown, but our dealer network planning initiatives are confidential, primarily because of some of the issues that Commissioner Bonaccorsi mentioned. It’s a very complex process and in planning dealer networks, and there are statutes that constrain our ability to do that, so until those plans are finalized, they must remain confidential.”
- Dirk Lorenz (1:08:52): (Discussed with Mr. Frederickson brands to go in Fremont Auto Mall.)
- Yogi Chugh (1:10:30): “You mentioned quite a bit about the fact that network planning and confidentiality and you mention that you are committed to the fact that both of the buildings will be occupied. Is there a hypothetical that the second building because of whatever conditions may exist may never get occupied as well? Because you don’t know, right?”
- David Frederickson (1:10:49): “I don’t know. But I know there is considerable demand for space within the Fremont Auto Mall. I feel we were very fortunate to have the opportunity to acquire this site, which was formerly for non-automotive use. So, I’ve, from a real estate standpoint, I have absolutely no concerns that whether it’s occupied by General Motors brands, or non-General Motors brands, the space can be occupied and there is demand for it to be occupied for automotive use….At this point in time we do not have an occupant for the second site.”
- Inder Dosanjh (1:11:27) (approached the podium without invitation or recognition of Commission): “I’m actually the dealer. I just bought the Saturn…I’m sorry, Inder, Inder Dosanjh. I bought the Saturn store in Fremont. I have three other Saturn stores in the Bay Area. We’re very successful, we sell a lot of cars, we’re profitable. Every store is profitable, even with the economic conditions we have right now. And I have my options. We could, I’m working with three, four different manufacturers. We’re looking at a lot of different things. We just can’t talk about it right now. That building won’t be empty.”
(Discussion continued between Commissioners and Mr. Frederickson about land ownership structure with dealers, 25-year site control, facility brand image.)
- Dan Lydon (1:18:39): “Mr. Frederickson, your associate there mentioned he was from the Saturn dealership in Fremont. I heard Fremont, I just wanted to verify that I heard correctly.”
- Inder Dosanjh (1:18:46): “The name is Fremont. It’s actually in Newark.”
- Dan Lydon (1:18:49): “Here, it’s Newark.”
- Inder Dosanjh (1:18:54): “The name of the dealership is Saturn of Fremont, but it’s actually in Newark.”
- Dan Lydon (1:18:58): “I accept the name, but here it’s Fremont. This is Fremont, they’re in Newark. Thank you.”
- David Bonaccorsi (1:19:10): “Just as an aside, about Commissioner Lydon’s comment, the reason they’re in Newark is because GM didn’t allow them to go to the Auto Mall in Fremont 20 years ago. Now they’re asking to go to Fremont.”
(Discussion about image guidelines and miscellaneous items.)
- Don Signer (1:20:30): (9 minute presentation. Script available here.)
- Yogi Chugh (1:30:01): “Mr. Signer, thank you for sharing the information you sent along. It was reading that I (unintelligible) because it’s one of those issues that you come back and say could I account for that in my land use decisions. But I did read through that, and it appeared based on what I read it appears that there seems to be some conflict with General Motors in your personal business dealings. (Unintelligible) What you had built, it’s exactly the same. So from a land use point of view, what they’re asking for today, it’s a good plan. Your issue is that General Motors has changed their plans, left Fremont, went to Newark, they forced you to do that. You asked them to allow you to move over to Auto Mall. They prevented you from doing that and at this moment in time they are coming before us with the fact that they want to move to Auto Mall and they’ve lost some financial incentives that could have been extended to you as a part of the dealer network that you represent which is Buick and Cadillac. So at this moment in time it appears to me, and correct me, but there seems to be some huge issues with you and General Motors.”
- Don Signer (1:31:09): “You’re absolutely correct. I don’t know, I don’t think it’s anything personal. They had plans they put together in the early ‘90’s called Project 2000. They determined that I should be in Newark for whatever reason and they kept their eye on the ball. They wanted to pair up Buick, Pontiac, and GMC. That’s their channeling plan. They’ve kept their eye on that and if somebody’s in their way, like me, they just keep going forward.”
- Yogi Chugh (1:31:30): “Mr. Signer, thank you again for coming. I always appreciate it when people from the community, and today you’re coming in as a member of the community and have served for a long time in this community and you’ve mentioned some of your affiliations. There are a number of things we can consider and there are a number of things we cannot consider. There are a lot of things we cannot consider. So at this moment in time, can you give me anything other than the fact that General Motors changes their minds and something other than the fact that you have a conflict with General Motors. What other reasons can you cite that this plan should not be approved.?”
- Don Signer (1:32:02): “Well, as far as changing their minds, yes, I would look at that. I understand that your role is to determine what’s best for the City of Fremont. I certainly respect that and that should be the bottom line of the whole thing. And it’s just a matter of my experience with them, who knows what’s going to happen with that other building, who knows if they’re going to say, “Gosh, we’re going to need a bigger building,” or “we’re not going to use it,” or whatever the case might be. So, from a consistency point of view, their views, I mean their plans, seem to change with the change of management. Mr. Frederickson’s been with them 4 years and he doesn’t know the history. Now he might know a little more after hearing this, but who knows what’s going to happen with the next rotation of management. So, that’s one thing. As far as my personal thing, it could be the final blow to everything I’ve worked for in my life. That’s my appeal to say, I’m just letting you know that it could be the end result of this, which, I don’t, that’s probably not consistent with what you need to look at. It’s kind of like a guy that has a piece of property and is going to have a high-rise built next to it and say, “Hey look, I won’t have any sun any more, and you say, well, I’m sorry, we need this high-rise.” So, I don’t know if that’s a good analogy, but that’s kind of what it amounts to on that.”
- Yogi Chugh (1:3:10): “Great. Thank you.”
- Dirk Lorenz (1:33:18): “Mr. Signer, it’s more of a curiosity question. I think Commissioner Chugh put it very well. He kind of put in parentheses what is in our purview tonight and what is not. What happened to the $160,000 you invested in the Fremont Auto Mall?”
- Don Signer (1:33:33): “It’s gone.”
- Dirk Lorenz (1:33:35): “Gone. Interesting. Thank you.”
- Don Signer (1:33:36): “That [the lost investment] was 1990 dollars too.”
- David Bonaccorsi (1:33:45): “Since you made it part of the informational packet, Informational #3, I think it’s fair to say you’re involved in litigation with GM over these issues.”
- Don Signer (1:33:54): “That’s correct, which has nothing to do with this tonight. That’s unrelated.”
- David Bonaccorsi (1:34:00): “I just think it’s fair for the public and for GM to at least be aware of it, and I have gone through the lawsuit and at least your factual rendition as you’ve mentioned in terms of GM’s shifting position, I can independently corroborate that’s…I’m aware of that too. But, again, we’re struggling with what can we legitimately consider in a land use decision here, and on page 5 of 12 there’s a land use policy, 2.35, and it says an area can be designated high volume commercial if sufficient market demand indicates additional area within the City is required for this use. So, we’re not looking at market demand generally in the automotive industry, we’re looking at market demand that this applicant is proposing based on the various lines of GM products. You’re free to speculate. You don’t have access to proprietary information. They couldn’t tell me and I didn’t want to be flippant on that, or come across as being flippant. They have a right to the proprietary nature of what they’re doing. I think you would concur on that, so the fact that they did not reveal that is not a strike against them in my view. But, you’re not beholden to that. So, I’d like you to speculate, or based on your 20 years or 30 years of experience, and you talk about your father being in the business and you’ve been here for a number of years in this community long before you wanted to do the Auto Mall you were on Paseo Padre in Fremont. Fremont Boulevard rather. What is your sense of what the market will be, let’s say in the 4 to 6 years that, one way or the other, that this is to be justified as a business proposal for GM?”
- Don Signer (1:35:31): “Well, just looking at, do you want to know my crystal ball of what GM’s performance is going to be over the next 4 to 6 years? I guess everybody has their own opinion. Obviously you can’t read the papers or watch TV, or whatever, without knowing the struggles the domestic industry in general is going through. And obviously at some point there’s going to be a bottoming out. And my situation, obviously looking at my own personal thing as I always have to do, Buick has, for example, in 1984, which was our peak year, we averaged 76 new Buicks a month. This year we’ve averaged 2, 2 Buicks per month, which happens to be the national average for Buick. So, my speculation, and the industry speculation, is that Buick may be going the way of Oldsmobile at some point in time. It’s virtually a non-contributor. Cadillac sales are, Cadillac sales are kind of holding their own, but we’re down to 4 to 6 cars a month, 4 to 6 new Cadillacs. So, as far as the rest of General Motors, General Motors has been totally dominated by truck, which I don’t have a truck line, which when I bought DiGiulio Pontiac-GMC, that would have solved that problem. I’ve struggled all these years without it. Trucks seem to be coming down with gas prices and everything, and again, at some point there’ll be, you know, a leveling out. Who knows, GM’s market share might drop another 3 to 4 points from where it is now and level out. It’s anybody’s guess, but, when the import ball is rolling, which it’s been going, it’s a hard momentum to stop.”
- Dr. Rakesh Sharma (1:37:12): “Are you done? Commissioner Chan please.”
- Sue Chan (1:37:18): “As you’re looking at your crystal ball, can you tell me, what do you, you mentioned that, although we don’t know which brands are going to be going out to Auto Mall, you believe that Buick and Cadillac would be going out there, so what is…”
- Don Signer (1:37:34): “I didn’t say that. What I said was I said that’s, I believe that’s GM’s intent. They haven’t talked to me for two and a half years about this. I mean it’s just kind of like all I can do is piece together from my own research because they don’t tell me. But when I met with them in January of ’06, they told me that they wouldn’t move to the Auto Mall, at least Pontiac-GMC across the street from me, unless it was what’s called on-channel. On-channel means Buick-Pontiac-GMC together. Those lines are structured now to where none of them can make it on their own because Buick is down to three models, two cars a month, Pontiac is down to a few models, which might sell the equivalent of 4 cars a month, and GMC might be 20 to 30 cars a month. So, those three lines need to be together and Cadillac, GM has pretty much indicated that, I mean it’s widespread that Cadillac is going with Buick-Pontiac-GMC stores because Cadillac can’t stand on it’s own unless it’s in downtown Detroit or some major GM stronghold like that. So, anyway, GM indicated to me in 2006 that those four lines they had intended to be together. Now, as long as I’m in business, they can’t go forward with that. That’s a roundabout answer to your question. They’ve got their goal, which, of course that’s what I bought in ’91 when I bought DiGiulio Pontiac-GMC. I did exactly what they want to do today, but it’s not going to be me, even though I’ve done everything for GM.”
- Sue Chan (1:39:00): “So in other words, your relationship with GM, in terms of your Buick and Cadillac, is that renewed annually? How does that work?”
- Don Signer (1:39:10): “Every five years.”
- Sue Chan: “So where are you now?”
- Don Signer: “I was just renewed in 2005, October. Renewals are pretty much automatic unless there’s some strong reason for them not to renew it, and it’s got to be really strong. It’s rare that a dealer’s franchise doesn’t get renewed. Now they did threaten, I told you, in ’93 to not renew my Cadillac franchise because in that original thing it said I had to move to the Fremont Auto Mall on a specified timetable. And, the specified timetable, everybody thought the Auto Mall would move more quickly than it did, and it ran into some very bogged down things; a bad economy, Hank Torian was trying to buy an empty building out there and it dragged out and everything, and so my timetable got backed up. But then they started flexing their muscles when they wanted to move to Newark and they tried to use that as a lever and they threatened to not renew it. So, there’s a case where they could say, OK, you didn’t follow the timetable so we’re pulling Cadillac.”
- Sue Chan (1:40:02): “One of the questions that I asked the applicant was whether or not they provided financial incentives to encourage dealers to… They haven’t talked to you.”
- Don Signer (1:40:22): “No, I’m not their fair-haired boy.”
- Sue Chan (1:40:30): “Is it reasonable to say that perhaps they will talk to you if in fact this channeling they need all four of them there?”
- Don Signer (1:40:40): “Who knows. It’s just kind of like communication is cut off.”
- Sue Chan (1:40:45): “For the dealerships that will be leaving Newark and going to Fremont Auto Mall, do you know of any plans for that property? Do you think Newark’s going to be trying to, you know, fill the vacancy?”
- Don Signer (1:41:04): “I have no idea. I know GM put this whole thing together there was a tax incentive from the City of Newark which GM put together, and obviously Newark wants those tax dollars to continue to come in, and normally automobiles are a good source of that, even though the dealers in Newark are mostly domestic and they’ve been falling down. So, I’d think they’d want to keep it, but that’s just my speculation. But, at some point they’re going to have to face the fact that when Saturn moves out, then Pontiac-GMC eventually, and some day I’ve got to look at the value of my building which General Motors just told me, “Don, you might as well tear it down. That’s what they told me in ’06. This new building we made you build. So, I don’t know what the future is there other than the fact that when they move out, it’s no longer an auto center. It’s a small auto center now, but it’s going to be a ghost town. I’m sorry, it sounds like there’s something more in your question.”
- Sue Chan (1:41:52): “I just think that Newark would be doing something to replace what has left.”
- Don Signer (1:42:00): “If they are, I’m not aware of it. I mean they haven’t discussed anything with me about because they know I plan to stay there as long as I can afford to.”
- Dr. Rakesh Sharma (1:42:09): “That’s all right, that’s not what we’re talking today, but I kind of appreciate… Any other questions? Um, thank you very much. I do understand your point of view and I hope somebody at GM is listening and tomorrow you might have a phone call, say, hey, you know, we know your passion and we want to help you out. Let’s sit together and find a solution. Thank you very much. I’m going to call applicant back. You’ve got more than five minutes.”
- David Frederickson (1:42:50): “Thank you Commissioner Sharma. I don’t think I need that much time. Um, with all due respect to Mr. Signer’s comments, I don’t see how they’re relevant to the application before us tonight. So, I don’t have any direct response to anything Mr. Signer said. I do have just two general comments. One, with regard to the economic industry, of the sluggish state of the automotive industry right now, I don’t think it’s unique to domestics. I think imports and domestics alike are suffering, um, Mr. Dosanjh can probably comment to that as he has wide contacts within the industry. I think it’s a reflection of the broader economic issues that we face in the nation right now. And, I think, I’m no expert on the matter, but I think most experts do believe that we are very near the bottom of that trough, and I think the timing of this development is probably very well positioned for an emergence from the current economic situation we find ourselves in. Um, my second comment in responding to your suggestion that we contact Mr. Signer tomorrow, one of the primary reasons we are not in contact with him is because of the lawsuit he has filed against General Motors and we’re restricted from having that dialogue. Just so you’re aware.”
- Dr. Rakesh Sharma (1:4:06): “So in other words you’re willing to work it out if he’s willing to work it out.”
- David Frederickson (1:44:19): “I didn’t say that.”
- Dr. Rakesh Sharma (1:44:22): “You said there’s a lawsuit so you cannot talk to him.”
- David Frederickson (1:44:28): “Typically the defendant in a lawsuit does not discuss the matter of the suit with the plaintiff. So, we are restricted from…”
- Dr. Rakesh Sharma (1:44:33): “We have attorneys on this side of the podium and we’ll figure that one out, OK? Thank you. Do you have something to add?” (Speaking to Mr. Dosanjh who had approached the podium.)
- Inder Dosanjh (1:44:38): “I just want to state that, um, I just built a dealership in Dublin and I know exactly where I stand with economics. I’ve done several business plans and, we’re OK. You can talk to Hank [Torian]. He’s not in a good mood right now. I had a conversation with him last week. But, we’re one of the few dealerships in the Bay Area, and I’m also in Honolulu as well, we’re doing well. You know, so… We’re selling Saturn, we’re selling Hummer as well. Very successful Hummer dealer. Thank you.”
- Dr. Rakesh Sharma (1:45:16): “And that’s what you’re bringing to Fremont. Just hold on, we have some questions going on. Mr. Bonaccorsi.”
- David Bonaccorsi (1:45:26): “This is a slightly different direction, and we typically ask… Did you poll the other Auto Mall owners, dealers in terms of garnering support or any kind of feedback in terms of your plans, at the Fremont Auto Mall. Yeah, I know it’s across the street, but have you had any mitigation discussions with Magnussen or Fletcher Jones or anything?”
- Inder Dosanjh (1:46:00): “We work independent. We’re very successful, and we do well.”
- Dr. Rakesh Sharma: “Mr. Lorenz.”
- Dirk Lorenz (1:46:08): “Thank you Mr. Chair. Once again sir, where are your dealerships located? You said Dublin, Honolulu, Concord.”
- Inder Dosanjh (1:46:12): “Dublin, Honolulu, and Concord. And I had several dealerships in Modesto I just sold a few years ago.”
- Dirk Lorenz (1:46:18): “And just curiosity, it’s up to you if you want to answer. Where do you live?”
- Inder Dosanjh (1:46:26): “I live in the Bay Area. I don’t live in (unintelligible, but the word was most likely “Fremont”).”
- Dr. Rakesh Sharma: “Commissioner Yogi Chugh.”
- Yogi Chugh (1:46:38): “Mr. Frederickson, you mentioned that this is a General Motors franchise, but you also mentioned that there could be the opportunity for other brands to be at this location as well. Could you clarify?”
- David Frederickson (1:46:53): “We acquired this property based on a business case, and we’re going to make sound business decisions, and at this point in time, for a variety of reasons, we do not have General Motors brands available to fill the other space. So, if we determine that over the course of time the prudent decision is to offer that second parcel for non General Motors brands, we will consider that.”
- Yogi Chugh (1:47:25): “So you’re asking for a zoning change so you can have the option to build the two buildings, and at that moment of time in the future you reserve the right to come back and certainly fill this up with GM brands. But, if the economic conditions, or whatever your business relationships end up resulting in, your intent is to fill up the second building, at all costs, all circumstances.”
- David Frederickson (1:47:43): “Um, I can’t say that. That’s speculative I believe.”
- Yogi Chugh (1:47:49): “The reasons I’m asking these questions is because when we change the zoning, um we’re looking at staff recommendation and under the project analysis they’re talking about economic impacts as well, so it’s (unintelligible) I’m trying to get a gauge for the fact to make this decision, um, are we making the right decision for today and the long term. You’re telling us that your intent it to have a long-term plan, preferably with GM brands if possible. And really, this whole idea that you can’t tell us who it is because of the fact that, and I think Commissioner Bonaccorsi even mentioned the fact that (unintelligible), but from time to time. And when we kind of ask in all of these things who’s coming a couple projects of late we’ve actually asked the applicants who they’re going to bring. That’s why I’m struggling with this. It appears the rules are different at different times. Could we just get the City Attorney’s guidance on this one?
- City Attorney (1:48:46): “Well, this is a land use decision and what you’re looking at is this use of this land, not necessarily GM or any particular car company. If something happened and they left three years from now. What we’re looking at is changing the use her, and essentially extending the auto uses out there. That’s your decision, not what their business plan is.
- Yogi Chugh (1:49:07): “And I asked the question because my fear was that was going to be your response, and I think that helps (unintelligible) perspective for a moment. We just need to come back and recognize what’s before this commission today. From a land use standpoint, the applicant has requested something, and we have to either approve based upon the staff recommendation or not, and if we decline it, we need to give a good reason why we’re not. Um, I’m running out of questions so…”
- Dr. Rakesh Sharma (1:49:35): “Thank you. And I have to say thank you, and thank you very much. Sure, you’re asking me a question?” (Response to Inder Dosanjh interruption)
- Inder Dosanjh (1:49:42): “I’m going to answer your question. The current business plan, our forecast is around 50 to 60 million dollars a year in sales. I can answer that.”
- Yogi Chugh (1:49:47): “Mr. Dosanjh, any information you give us right now is way beyond what you need to provide us.”
- Inder Dosanjh (1:50:02): “I understand. I’m trying to address your concern there. I understand what you’re saying.”
- Yogi Chugh (1:50:04): “Fair enough.”
(Public hearing closed. Commission continues discussion about land use issues.)
- Dr. Rakesh Sharma (1:57:22): “All right, that’s all from me. Uh, I see Commissioner Dan Lydon.”
- Dan Lydon (1:57:30): “Yes, thank you. I’m not too sure I have a question, comment, or observation, but I’m going to try to roll it into one. It seems to me that as a Commission we have a very unique situation before us this evening where we have a land use issue that is somewhat clouded with a history that none of us maybe were aware of or wanted to hear, but nevertheless, really does exist. As I look back over the 45 years that the City of Fremont has had a relationship with General Motors, you’d have to say the fingerprints of General Motors have been on this city certainly ever since that plant went up. The men and women that called themselves residents of Fremont contributed I’d say maybe with two generations of employees that really made their lives better by working for General Motors as well as the association between the City of Fremont and General Motors, one that we pointed to as residents, employees, and businesspeople with pride. We have a situation this evening that appears to be clearly a land use issue and it’s somewhat segregated from the other things we’re hearing. But it’s hard to ignore, and I’m somewhat saddened, maybe confused, by listening to what appears to be the ongoing daily dealings between parts of the General Motors family who are the dealers, as well as the real estate division which seems to be somewhat disconnected from the real world at times. And I understand that they have a right to feel and withhold the information that they want. But something conjures up in my memory there was a famous ad for an exterminator in the Bay Area here, who was holding a wooden mallet behind his back and he was coaxing the fly or mouse or whatever in then clobber him. And, uh, I know we’re not sitting up here as a Commission to be the jury on Mr. Signer’s lawsuit, but it’s, if we were, I wouldn’t want to speculate on how we might respond to that. Our allegiance is to the City of Fremont. Uh, it can’t be a blind allegiance; I recognize that. Certainly the condition that Mr. Frederickson is requesting this evening falls within the guides of common sense for the City of Fremont, goes in the direction we are charged to come up with, recognize and honor. Again, I don’t see anything I can do, I’ll stand to be enlightened on it, to resolve those other issues, other than to send a clear signal to General Motors that, uh, people in this city are not thrilled about seeing their residents, their businesspeople, treated in that manner that it has to go to a lawsuit to resolve. I don’t know if Mr. Signer is correct, but I’d like to think that there’s a fair amount of history that’s verifiable in the issues he raised this evening. And, it’s part of, how would you say it, our fabric, or our plank in our platform that we hate to see. We’d like to think that this city has been very appreciative of the input of General Motors, and I hate to see that relationship boil down to this and this kind of gamesmanship being played amongst the people attempting to do business here, those who have chosen to live here and be a part of this community to be subject to that by people who are here for a few minutes as we look at life. So again, as a Commission I think we are faced with a straightforward land use issue that has benefits to the City of Fremont, but maybe not necessarily over the long haul is it fair and equitable to all.”
- Dr. Rakesh Sharma (2:02:06): “Thank you Commissioner Lydon. Commissioner Bonaccorsi.”
- David Bonaccorsi (2:02:14): “Yes. It’s actually very difficult in this instance to follow, as always, to follow you Commissioner Lydon because I think you expressed some of the sentiments, some of the concerns that I have is segregating the land use decision from, um, what is happening to an individual dealer here who has been here for a number of years. As I said, I can independently corroborate the fact that, you know, GM made some institutional decisions. And the gentlemen that are here… GM’s a huge corporation, and we have one unit here, real estate acquisition, uh, Mr. Frederickson’s doing his job and doing it ably. And you have a Saturn dealer that is anxious to go in and increase some tax revenues. And I think Miss Taylor’s comments about looking at land use and Miss Borger’s comments about looking at land use generally for auto use as opposed to particular dealer, or particular manufacturer I think were well taken. Um, but what hangs out there would be an ideal situation to see Don Signer out in the Auto Mall as he always wanted to and, yes, even if there’s a lawsuit pending as an attorney I can say that the attorneys can get around the room and have the principals talk to each other. The principals can always talk to each other without the attorneys present, and, uh, you can have confidential settlement discussions that never see the light of day in a courthouse. So, the fact that there’s a lawsuit shouldn’t be a reason to slam the door shut on a gentleman who’s been here for a number of years. But that’s where, as Commissioner Lydon so ably said, we’re not here to be judges and jury. I haven’t seen any depositions, I’ve seen a lawsuit, uh, it’s one person’s perspective. I’m not going to sit here in judgment of GM based on competing allegations, other than to note that I do know the history of why we have a Saturn that calls itself Fremont Saturn but is in fact on Balentine Drive in Newark. So, we have lost 20 years of sales tax revenues based on corporate decisions that, in GM’s infinite wisdom, they made a long time ago. But we return to the fact that we’re making a land use decision. In fact, ironically Mr. Signer was the best witness for GM even though this was not his intent. Why has he struggled to try to get out to the Auto Mall for 20 years? Why did he put $160,000 into an investment? Uh, why did he try to get free land and all incentives because I do know that the Auto Mall works. It is a great synergy. There is a demand, or if it’s not going to be this GM line, if there is in fact an increasing demand on imports as opposed to domestics, there is a pressure point there. It is good for synergy, it is good for the City of Fremont. And again, there is that ambivalence in terms of the individual situation. But we’re not here to judge the individual situations, so I will support Staff recommendation.”
- Dr. Rakesh Sharma (2:05:03): “Thank you Commissioner Bonaccorsi. Commissioner Lorenz please.”
- Dirk Lorenz (2:05:05): “Thank you Mr. Chair. Uh, well you thought it was hard following Commissioner Lydon, now I’ve got to follow both of you, so how do you think I feel? Um, the Assistant City Attorney pointed out very well the decision we’re making here tonight and the relevance of Mr. Signer’s comments to tonight’s proceedings and it is a land use decision. Um, highest and best use of the site, especially when you consider its relationship to the existing Auto Mall, industrial versus commercial. Um, kind of a no-brainer. But, well, to say that I would not be overanxious to see the revenue, the sales tax revenue, generated by additional auto sales out in the Auto Mall flow into this city’s coffers is an understatement. It’s theses moneys that help us maintain our streets, and hire our police officers, and make Fremont a great place to live, and I sure recognize that. But, what also occurs to me is how businesspeople like Don Signer also contribute to our community. He said it, a 28-year resident, 24-year member of Fremont Rotary, someone who has contributed countless times to our local non-profits, and even a pioneer in the Auto Mall. In Mr. Signer’s words he said, “I have operated a highly reputable business with the highest of ethical standards.” I sure appreciate that. Just as the sales tax revenue that I spoke of contribute to a quality city, businesspeople like Don Signer also contribute to making this city great. There’s no doubt about it. To say that I would not be extremely disappointed to see that addition to the Auto Mall develop without a Don Signer in it, to me, the City’s losing a great asset. Um, yet, we’re faced with a land use decision tonight, and one I have to say I’m all in favor of Staff recommendation. So, should this move forward tonight, I would hope that somewhere along the line, business ethics once again enter the discussion. Thank you.”
- Dr. Rakesh Sharma (2:07:23): “Well said Commissioner Lorenz. Any other comment, questions? You know I can only tell you that I think Mr. Don Signer represents GM with all its headaches and I think you look at GM as a great company. GM is America, and I can only tell you that if there is a way to go out, and I totally agree as a chair I wouldn’t say that. We need to make this as an issue, we’re dealing with land use and you’re going to get what you want tonight. Uh, but please go back, and I know there are feelings at each end, and see if you can work this one out and make everybody happy in the process you do not want as GM even a single dealer or someone associated with you to think negatively about GM that’s such a highly, highly placed great American corporation. So that being said, I do see Commissioner Chugh wants to say something here.”
- Yogi Chugh (2:08:35): “Once again I know this conversation has rotated around Mr. Signer quite a bit. Mr. Signer has been a (unintelligible) seen you work in our community in many ways would appear as a difficult situation for you and General Motors and the hope is that this can be amicably resolved out to a point that it makes a win for everybody including you. So, you’ve heard us all loud and clear and in any way does not reflect a viewpoint contrary to what you’re saying. It’s merely something we’re bound by and a decision has to be made, and that’s basically what you’ve heard from all of us this evening.”
- Dr. Rakesh Sharma (2:08:10): “All right, with that being said, we have a motion which has been seconded. Please vote. The motion passes, 6 yes, Commissioner King absent.”
Fremont City Council Meeting September 23, 2008
Following is a transcript of statements by various people at the Fremont City Council meeting on September 23, 2008. Statements transcribed are generally limited to those made relative to the Signer/GM dispute. People quoted below include Vice Mayor and Council Member Bill Harrison, Council Members Steve Cho, Anu Natarajan, and Bob Wieckowski, City Attorney Harvey Levine, and Regional Manager GM World Wide Real Estate David Frederickson. Mayor Bob Wasserman was not in attendance at the meeting due to illness.
A webcast of this meeting can be viewed at Fremont City Council 9/23/08 (mms://198.199.140.33/CCMeetings/CCMtg080923.wmv.) Times shown after names below are the amount of time into the unusually long Council meeting, as noted on the webcast time monitor. On the webcast, the time can be advanced using the slide bar near the bottom of the webcast window.
In viewing the meeting on the webcast, the GM issue does not begin until about 3 hours and 43 minutes into the meeting. It was preceded by an unusually long hearing in which 29 Fremont homeowners gave input about proposed residential building restrictions in one neighborhood. Of interesting note is the ethnic makeup of the 29 resident speakers: 20 (69%) were Asians, mostly Chinese in their 30’s and 40’s with families, and 9 (31%) Caucasians, mostly of apparent retirement age. Most of the Asians were relatively recent arrivals to the neighborhood and apparently to the United States, while most of the Caucasians had lived there long before the Asians arrived. This ratio of GM-shunning Asian immigrants over Caucasians is representative of my market in general, and indicative of the difficulty associated with GM market penetration within the import-dominated market segments in which Buick and Cadillac compete.
Color highlighted comments for quick reference. All are also in italics.
Green = Comments of interest relative to Signer Buick-Cadillac
- David Frederickson (3:45:00): Mr. Frederickson gave a short presentation of GM’s proposal, noting that the Fremont Auto Mall is “one of Bay Area’s most successful Auto Malls.”
- Anu Natarajan (3:47:55): “You said that General Motors acquired this property in…”
- Mr. Frederickson (3:47:59): “December 5th, 2007.
- Ms. Natarajan (3:48:00): “And you knew at that point that you still needed to go through a General Plan Amendment?”
- Mr. Frederickson (3:48:05): “Yes, we did.”
- Ms. Natarajan (3:48:07): “To allow the use that you wanted.”
- Mr. Frederickson (3:48:09): “Correct.”
- Ms. Natarajan (3:48:1): “OK, that seems a little backwards in terms of assuming that’s going to happen when you bought the property.”
- Mr. Frederickson (3:48:18): “Perhaps presumptuous, but I think it’s not uncommon that people will acquire property without entitlements depending on the level of risk that they determine to be.”
- Ms. Natarajan (3:48:32): “In terms of timing, why now?”
- Mr. Frederickson (3:48:37): “The timing was actually 18 months ago when we initiated this process, we opened this transaction well before the Dec 5, 2007, closing date, we actually had a deferred closing date with the seller.”
- Ms. Natarajan (3:48:55): “So you’ve been in process about 18 months. Is that what you’re telling me?”
- Mr. Frederickson (3:48:59): “The process for identifying dealership properties, acquiring those properties, resolving all of the dealership network issues that are a challenge due to a number of different both state and other type regulatory issues. It’s problematic for us to put everything in order and then go find the property. Often times we have to go find the property first especially in major metro areas such as the San Francisco Bay Area it’s important that we identify those properties and structure a transaction with in this case a rather lengthy due diligence period, with part of that due diligence was resolving some of the dealer network issues that needed to be put in place in order for us to proceed with the project[1] and I assume your question is pointed at the fact that current economic times would not indicate the best timing for this type of development, but after all the effort we’ve put forth and the success that we are able to achieve we’ve determined that it’s in our best interest to move forward and we feel confident that the economy and the automotive industry will rebound and hopefully the development of this project will coincide timely with that economic upturn.”
- Mr. Wieckowski (3:50:20): Mr. Wieckowski and Mr. Frederickson discussed the issues of a traffic study and the design of GM’s project.
- Mr. Wieckowski (3:56:20) “One of the findings we have to make, and I did have a visit with Mr. Signer, who’s the one speaker today, is that it’s not going to have an adverse affect on the economy. I take more of an elastic view that Mr. Signer makes the argument that his auto dealership is going to have an adverse, he’s going to be adversely affected, and I was wondering if you could address that issue. I know he’s going to be coming up here soon.”
- Mr. Frederickson (3:57:02): “From my perspective it’s a land use application for a zone change and a general plan amendment in the City of Fremont. Mr. Signer’s business is in the City of Newark and with all due respect I don’t see the relevance of the economic impact to the Newark-based business in the application for this type of land use approval in the City of Fremont.”
- Mr. Wieckowski (3:57:25): “I guess the issue is, you know, this is an Auto Mall question, we have all kinds of questions. When Wal-Mart comes in and people say all they’re doing is cannibalizing other businesses that you have. And it is down the street, and we have other use auto businesses that are sprinkled around. We tend want to move them out and we have others on the Fremont Boulevard and they still remain so it has an impact. I don’t know how I measure it, but that was…”
- Mr. Frederickson (3:58:02): “As far as the impact to the City of Fremont, it seems that it would result in a positive influx of sales tax revenues, so I would, my opinion is that the impact would be positive.”
- Mr. Cho (3:58:26): “I realize you said that this is a land use decision, but in making the land use decision we want to make sure that the proper things are in place to utilize that to the best that we could to benefit you and benefit the City. Are you at liberty to disclose who’s coming at this point?”
- Mr. Frederickson(3:58:51): “I can disclose that the current Saturn dealership that is located in the City of Newark is going to be relocating to one portion of the proposed dealership facility on the Boscell Road property. I’m not at liberty to disclose the details of the second brand that will be located at that site due to the fact that we are bound by obligations of confidentiality as we continue to develop our dealer network planning initiatives. Currently we do not have brands identified for the second parcel, and we intend for that to be developed for automotive use as well.”
- Mr. Cho (3:59:37): “But there are three parcels, is that right?”
- Mr. Frederickson (3:59:41): “There are two parcels.”
- Mr. Cho (3:59:42): “I thought there was two, well one parcel split into two, and then there’s a third one.”
- Mr. Frederickson (3:59:48): “There are two parcels. There’s the 42992 Boyce Road property which we have a building that’s identified to accommodate only one dealership. And then we have the Boscell Road parcel which is the larger of the two, and it’s identified to accommodate two separate dealerships in the common facility.”
- Mr. Cho (4:00:10): “OK. Thank you.”
- Ms. Natarajan (4:00:15): “Just to follow up on that, you have two phases you are proposing. Can you give us a timeline of when those are likely to happen?”
- Mr. Frederickson (4:00:23): “We currently have applications for building permits in with the City for the first phase, again, at risk. It’s within our prerogatives to take on that risk and apply for permits simultaneously with the pending land use application we’ve elected to do that so that we can move quickly in anticipation that we would be successful in our efforts to secure these entitlements and if that’s the case we would be proceeding with construction as early as October of this year, next month, and hopefully opening those dealerships for operations in early summer, early to mid summer of 2009.”
- Ms. Natarajan (4:01:09): “Phase one. And what about phase two?“
- Mr. Frederickson (4:01:14): “Phase two we do not have any dealerships or brands identified for that location. We would continue our efforts to try and secure an arrangement to place General Motors brands on that site and if we’re unsuccessful in doing that we would consider our options for that piece of property. There remains to be significant demand for property in this Auto Mall. There is literally no other parcels available for automotive use and since we’ve closed on the property we’ve been approached by real estate professionals and dealerships alike with an interest in acquiring the properties from us. So, we’re confident that if necessary we would not have any trouble in flipping this property for a non-General Motors use if we elected to do so.”
- Mr. Harrison (4:02:04): “Phase one is the Saturn and the unknown GM brand at this point?”
- Mr. Frederickson (4:02:09): “Correct.” (Mr. Frederickson excused from podium)
- Don Signer (4:02:30): (Presentation made with same script as presented to Planning Commission above: Script available here. No questions by Council members. )
- Mr. Harrison: (4:08:02): “Bring the applicant back.” (Mr. Frederickson came to podium.) “You have five minutes to say whatever you’d like to say.”
- Mr. Frederickson (4:08:08): “I have no direct response to his comments.”
- Mr. Cho (4:08:17): “I guess, again, this may not be a land use decision that these questions may be addressing, but I would think that, based on the history we just heard, that it’s clear in my mind that there’s been a series of incidences on GM’s part to purposely go down a certain path to, I guess, I don’t know why GM would do this, to block the business plan that would not only benefit the property owner but GM as well. Why would GM do that?”
- Mr. Frederickson (4:09:03): “I was not involved in the decisions that were made 10, 15 years ago. I can’t respond to your question directly because I don’t know. I would say that Mr. Signer’s comments are his comments. They are his allegations. They are the same allegations that are contained in the civil complaint that he’s filed. You know it’s one man’s side of the story, and uh I’m not in a position to represent General Motors’ response to those comments because frankly I don’t know. I was not involved, um, I haven’t been deposed as part of the litigation surrounding Mr. Signer’s complaints. I’m sorry, I don’t have the information to knowledgably respond to your question.”
- Mr. Cho (4:09:51): “I guess that lets you off the hook at this moment.”
- Mr. Frederickson (4:09:53): “Sorry.”
- Mr. Cho (4:09:55): “OK. I guess in the name of progress, um, I know that many cities would be jumping at the chance of alluring, you know, auto dealerships to a town, because every town is trying to get more tax dollars, and I don’t think there would be any town that you would approach that would turn an auto dealership down. So, we’re kind of left with, it’s kind of a difficult choice, even though from the City’s viewpoint it’s the right choice, and that’s to your benefit. But, in looking at the history of what went on and how your treated your own dealer, that kind of surprises me that the business ethic of treating part of your own the way that this is going down.” (Mr. Frederickson stepped down from podium without responding.)
- Mr. Harrison (4:11:01): “Any questions of the applicant at this time? If not, I will close the public hearing and bring it back to the Council for thoughts.”
- Ms. Natarajan (4:11:20): Ms. Natarajan discussed location of property and architectural issues and received response from Staff.
- Mr. Wieckowski (4:21:32): “I guess this is for our Council. It’s a lot to get through with Mr. Signer’s uh numerous letters and Superior Court case and newspaper articles. But essentially there’s a desire to limit the land use based on the economic impact that’s going to happen to him. I mean, if I could, you know, melt it down to its finest point, and is there authority for that?”
- City Attorney Harvey Levine (4:22:13): “You shouldn’t be taking into account the contractual relationships between, the franchise agreements between a corporation like GM and their franchisees. Those are private business relationships. Undoubtedly, um, I’ve read Mr. Signer’s materials as well, and it would appear he has an interesting lawsuit and, uh, and interesting problem with GM, between them. Interesting from a third party point of view, certainly not interesting for him. But, your decision here is to exercise your discretion within the framework of our ordinance code. So, you should be looking at this as a land use issue. As you’ve pointed out there are some findings to be made considering those impacts. But you should try to think of this as a general series of findings for the benefit of the community at large and not for an individual either on the negative side or the positive side.”
- (4:23:22): (Various discussions by Council members and staff regarding infrastructure of traffic lanes, sidewalk size, landscaping, displaced habitat, architecture, etc.)
- Mr. Cho (4:31:45): “I guess I’m looking at this from a strictly business point of view, that because knowing the condition of our financial position in the City, that, I don’t want to say ‘anything goes,’ but anything this size would certainly help. And, just like our City Attorney said, this is not about looking at the specific interests of one individual, but looking for the general interest of the City. I do sympathize with Don Signer and the documentation he provided shows a clear, I guess, well, it was clear to me that there were other reasons GM took the path it did. For Bill Ball, and I don’t know if all of us know him from the past. I happen to know he was a very sound businessperson, and for him to write a six-page letter addressing many, many concerns about the way the City was treated, as well as the Buick dealership, I think that points to the business ethics in general of this, of GM. Now, they’re waving the big dollars in front of us, and I, for one, will certainly not turn that away. That’s not in the best interest of the City. But I do want to say that I think GM needs to reconcile the differences between the current dealership that Mr. Signer has and what’s going on today. For, I’m sure that the second site, or the building that we’re talking about that he cannot name at this point probably includes the Buick, but not today, but tomorrow under a different ownership. And, I hate to see that because, but again, it’s an individual versus the interests of the City. And I do sympathize with the comments that Mr. Signer has, and I think he has grounds for some of the concerns he voiced to us through his documentation. But in the end what I’m charged with looking after the interests of the City, and I think I’d have to go with the recommendation to make this change, rezone this, to what we’re being asked to do tonight. So, that’s all I have to say on that.”
- Mr. Harrison: (4:35:00) “I’ll just say that I wish General Motors good luck, I welcome you, but would be a little remiss if I didn’t say that I think we’ve heard here tonight that General Motors does things a little different about purchasing or submittal of the plans, and I think it’s evident through the documentation that we’ve been provided. When I met with Mr. Signer as I read these documents I could not help but hear a stopwatch ticking in the background for like a 60 Minutes expose’ coming up that just shows a pattern of that going up there. I read Mr. Ball’s letter and I knew Mr. Ball very well and I would agree with the comments you made [Steve Cho’s comments]. I would certainly hope that the track record we have here in Fremont that we put that behind us and start fresh with a positive outlook going forward, and that there is some reconciliation between you and Mr. Signer. I hate to see a member of our community being treated that way. And I also hate the fact that the way our state government is set up we’re, you read in here what Newark was doing, what Fremont was doing it pits communities against each other. I think it’s wrong and it’s an unfortunate circumstance. I would support what Ms. Natarajan is talking about, about supporting the plan and giving you the approval you need to go forward, but bringing this back because I think this is a special site we want to see something that’s a little more special and it comes back with the review and it talks about some of the, if you will extra extras, whether it’s art, or whether it’s the pavers, and stuff like that. So that would be my…” (end of comment)
- Ms. Natarajan (4:36:33): “Before we make a motion I forgot to mention that I too had a conversation with Mr. Signer and had a chance to review all of his documentation. And, I didn’t think of 60 Minutes, I thought he needs to talk to Michael Moore.”
- Mr. Harrison (4:36:45): “’Roger and Me, Take Two,’ or something like that? Any other comments?”
- Mr. Wieckowski (4:36:52): “I’ll go ahead and associate myself with the comments made about the treatment of Mr. Signer. And, I too would like to have some additional work done on the Planned District so I’ll move that we approve Staff recommendation, except that we require, that we don’t approve the completion of the Planned District that we come back with guidelines or improvements on the Planned District with incorporating the comments that we made for something more greener, more improved design and special (unintelligible)…”
(Various discussions about motion)
- Vote was held, GM plan was approved 4 – 0.