Victory! Jack Spade Abandons its Mission District Plans

we-did-it

We organized, advocated, persevered. And after convincing the Board of Appeals to grant a rehearing on the merits, we got word that Jack Spade is abandoning its plans to open in the Mission District.

From the San Francisco Bay Guardian:

As representatives of the corporation left the hearing, they told a few activists and business owners that they “were done.” And when the Guardian reached 5th and Pacific CEO Bill McComb by email today, he confirmed that the company is giving up on this controversial location, where activists were concerned its deep-pocketed presence would accelerate gentrification of the neighborhood.

“[We're] not going to war with the neighbors. We like those people and their neighborhood and we are not fighting the issue. There are many a fine location for Jack Spade. Peace to the city!” McComb wrote to us.

We won’t dwell on the fact that McComb’s “Peace to the city!” line is a little misleading, since 5th and Pacific owns eight other stores within city limits (Kate Spade, Juicy Couture, and Lucky Brand are all under the 5&P umbrella). Nor will we harp on the irony of Jack Spade claiming all along to be an “independent business,” but having its parent company’s CEO that announce the pull-out.

No, we think now is the time to reflect on a few aspects of the campaign that we found to be effective. Because we know that, while we sent a message to corporations trying to dodge the public approval process, this likely won’t be the last attempt.

Here are four useful organizing lessons going forward:

  • Use the power of narrative: The world runs on stories; it’s the key to motivating people to act. In this case, we had a story that we felt was naturally sympathetic. A retailer with the resources of a big business displacing a community-focused bookstore. But putting it all together, particularly in a format that is easily digestible by media outlets, was important. (Thanks, Storify!) It helped guide the media framing as more outlets began picking up the story.
  • Build a Coalition: This is the single most important aspect to this campaign’s success. The pushback against Jack Spade began as a group of small business owners who were concerned, mainly, about the effect on the real estate dynamic (among other concerns about the neighborhood). But the effort really took off when the Coalition grew to include advocacy groups like PODER and Calle 24, as well as elected officials who backed the effort. Part of what made this possible was a widening of the narrative–making clear about the implications, not only for small businesses, but for the community-at-large, of a big businesses coming into the neighborhood without first going through the public approval process.
  • Stick to it: When we lost at the Board of Appeals in August, there were some in the coalition who were leaning toward channeling our efforts toward legislative reform, rather than continuing the fight against Jack Spade. But this is one of the unforeseen benefits of building a coalition: when some are ready to throw in the towel, others are ready to keep up the fight. And there’s no doubt it was an uphill battle to convince the Board to essentially reverse its own decision and grant us a rehearing. But this is where the coalition shined. At the hearing this past Wednesday, longtime residents of the Mission District spoke loud and clear about the importance of keeping Jack Spade out. Commissioner Frank Fung, whose change in vote was the key to our appeal’s success, specifically noted that this was what swayed him. Check out the passionate, articulate case made by Oscar Grande of PODER:
  • Have fun: We certainly got mileage out of the “Jack Off” puns. Sure, the New Yorker and its delicate sensibilities seemed off put by it. But whether it was the “Jack Off” fundraiser, or the “Fill the Streets with Seaman” event put on by Chicken John, it kept smiles on the faces of our supporters, and the momentum going even as we faced setbacks at City Hall. As the great Saul Alinsky reminds, “A good tactic is one your people enjoy.”
Chicken John's Jack Off 16th Street party

Chicken John’s Jack Off 16th Street party

A huge, heartfelt thanks to all the people who poured their heart and soul into this campaign.

Long live the Mission!

Matt Gonzalez: Jack Spade is Formula Retail, Subject to Public Hearing Process Under Existing Law

Former President, Board of Supervisors, and author of SF's original formula retail ordinance.  Image: notinoutname.net

Former Board of Supervisors President Matt Gonzalez, author of original formula retail ordinance.                               Image: notinoutname.net via IndyBay

Former President of the Board of Supervisors, Matt Gonzalez, has issued a letter in strong support of the request of the rehearing for Jack Spade’s permits and in support of Jack Spade being subject to a conditional use hearing before the Planning Commission before being granted permits.  Gonzalez authored San Francisco’s original formula retail legislation and saw it passed in 2004.

This legislation was a predecessor to former Supervisor and current State Assemblymember, Tom Ammiano’s formula retail ballot measure (Measure G), which was passed by the voters in 2006.  Ammiano has also issued a letter insisting that Jack Spade is subject to a public conditional use hearing  and that the company has operated in “bad faith.”

Gonzalez’s letter clears up outstanding questions of the law’s intent and clarifies how existing law is precisely relevant to the Jack Spade case.

Full text of the letter:

RE: VCMA’s request for rehearing in regard to building permits for Jack Spade

 Dear Honorable Board Members:

I am writing to clarify a question of interpretation of Planning Code 703.3 – the ordinance on formula retail, which I originally authored in 2004 while serving as president of the Board of Supervisors – as it applies to an appeal of building permits of clothing retailer Jack/Kate Spade.

According to Planning Code 703.3(b):

(b)   Formula Retail Use. Formula retail use is hereby defined as a type of retail sales activity or retail sales establishment which, along with eleven or more other retail sales establishments located in the United States, maintains two or more of the following features: a standardized array of merchandise, a standardized facade, a standardized decor and color scheme, a uniform apparel, standardized signage, a trademark or a servicemark [emphasis added].

The emphasis added above underscores that there are two interpretive approaches for a given business to be considered formula retail. One such approach is to look at a given retail sales establishment and consider whether the standardized outward appearance qualifies this business as formula retail. The other approach is to analyze the activity of a given business and consider whether that business engages in formula retail sales activity.

To illustrate the point, consider two examples by which a business could come to be considered formula retail under the planning code.  In one instance a “mom and pop” store begins with one location and then eventually expands to 11 stores with standardized outward appearance.  At this point it reaches the threshold at which it would be subject to conditional use hearings before opening more stores.  A second scenario would be a large company with more than 100 stores with standardized outward appearance, comes to San Francisco to open a store.  Note that in this instance, it is immaterial if the particular store in question features the same array of merchandise, standardized facade, decor and color scheme, etc. as the company’s first 100 stores. In this instance, the company is already clearly engaging in formula retail sales activity and any store this company wishes to open will be subject to a conditional use hearing under Planning Code 703.3.

In the case of Jack/Kate Spade, which is defined by its parent company as a single brand which offers fashion products “for women under the Kate Spade and Kate Spade Saturday trademarks and for men under the Jack Spade trademark,” the entity practices an activity which is formula retail.

For purposes of Section 703.3, it is irrelevant that a small segment of the Jack/Kate Spade business (Jack Spade) has not yet reached the store count threshold to be considered, in and of itself, formula retail. Taken as a whole, the Jack/Kate Spade business, which in total has 94 stores, clearly qualifies as formula retail by virtue of its retail sales activity.

The Zoning Administrator’s interpretation that Jack/Kate Spade is not formula retail may be understandable in light of what information was included in Jack/Kate Spade’s request for a letter of determination (enclosed). While making clear that Jack Spade is an “independent enterprise” in relation to its parent company Fifth and Pacific Companies Inc., there is only a single mention of Kate Spade, and this single mention concerns the appearance the Jack Spade and Kate Spade websites.

The ZA could understandably view Jack Spade as an independent business, because Jack/Kate Spade did not clearly delineate the fact that they are a single business that operates a men’s and women’s line.

In the request for a letter of determination, Melissa Xides, Vice President of Global Sales and Retail of Jack Spade, writes:

I have read through the Formula Retail classification document and have not found any mention of Parent Company ownership preventing a brand from qualifying as non Formula Retail operation. If different brands under a Parent Company with differing marketing intent operate stores under different trade names with different merchandise and merchandise mixes, the brand does not create the homogeneity that the Formula Classification tries to avoid. (Emphasis added)

The purpose of this letter is to make clear that this narrow reading of the formula retail ordinance is not, in fact, what the law was meant to avoid. The ordinance was meant to avoid homogeneity in outward appearance, but also formula retail activity, of which Jack/Kate Spade – a business with a single CEO, a single headquarters, and completely integrated infrastructure – self-evidently practices.

Issues of corporate ownership and/or corporate structure have been a matter of debate in previous hearings regarding Jack/Kate Spade’s permits.  While nowhere in the planning code does it require the consideration of corporate ownership/structure, neither does the ordinance forbid a consideration of corporate ownership/structure.  Indeed, in order to fulfill the clear intent of the law in a common sense manner, it will be necessary, in some cases, to consider corporate ownership/structure.

I urge you to grant the VCMA’s request for a rehearing of Jack/Kate Spade’s permits in order to prevent manifest injustice. Subsequently, I urge you to grant the VCMA’s appeal of Jack/Kate Spade’s building permits so that the public may have its opportunity to weigh in on this case in a conditional use hearing. Thank you.

Sincerely,


Matt Gonzalez

Author of formula retail ballot measure: “This case exemplifies what the legislation was originally written to remedy”

Assemblymember Tom Ammiano image: TheFreshScent.com

Assemblymember Tom Ammiano
image: TheFreshScent.com

Assemblymember Tom Ammiano, author of San Francisco’s formula retail ballot measure (Proposition G), has unequivocally backed the appeal in a strong letter of support.

In the hearing before the Board of Appeals on August 21, a question came up as to the intent of the legislation.

Without a definitive answer, we were left with only conjecture. But that all changed when Assemblymember Ammiano delivered his letter of support, writing that to allow Jack Spade to move in without first holding a public hearing would subvert the intent of the formula retail ordinance.

“Measure G was intended to protect the community voice from being overshadowed by large corporate interests,” Ammiano writes. “Jack Spade has operated in bad faith by using store count technicalities to evade fair and transparent public processes.”

Text of the full letter:

RE: VCMA’s request for re-hearing with regard to building permits for Jack Spade

Dear Honorable Board Members:

I am writing to urge you to grant the Valencia Corridor Merchants’ Association’s (VCMA)
request for a hearing on the status of retailer Jack Spade moving into the 3166 16th Street.
As a proponent of the formula retail ordinance (Planning Code section 703.3) and as a former
supervisor who drafted the 2006 Measure G, I say without reservation that this case exemplifies
the type of activity that the legislation was originally written to remedy. As such, I believe that
the board should listen to the community’s concerns and require Jack Spade to submit to a
conditional use hearing.

The core intent of Measure G was to protect San Francisco’s small business sector understanding
that formula retail businesses have a competitive advantage over small businesses. It was written
to ensure that small businesses were not displaced by large formula retail businesses that “can
absorb large startup costs, pay for more lease space, and commit to longer lease contracts”
(Planning Code Section 703.3). It was also drafted with the understanding that small businesses
contribute more to local economies while formula retail circulates the bulk of money earned to
corporate offices and vendors outside of the city.

Although Jack Spade claims to not qualify as formula retail because they have ten stores instead
of eleven, they clearly are far from being a small business. Jack Spade refuses to acknowledge
that they are a part of the formula retail company Kate Spade, which has 80 stores in the nation
and 100 stores abroad. In its written brief, the VCMA documented the many ways in which Jack
Spade and Kate Spade are in fact one in the same, but it bears repeating:

• The heads of both brands (Kate and Jack) report to Kate Spade LLC. CEO, Craig Leavitt.
• Jack Spade does not have its own separate headquarters. It shares the same offices as
Kate Spade, in New York.
• All Jack Spade merchandise is delivered by the same transportation company from the
same warehouse (Distribution Center) and managed by the same logistics team at
Kate/Jack Spade Headquarters.
• Both brands share the same logistics software, IT, HR and legal departments.
• In its own 10-K filings, parent company Fifth and Pacific Companies declares that its

“Kate Spade brand offers fashion accessories for women under the Kate Spade and Kate
Spade Saturday trademarks and for men under the Jack Spade trademark.”
To assert that these facts do not matter when assessing Jack Spade’s formula retail status
completely goes against the original intent of Measure G.

It is very alarming that the Zoning Administrator would see fit for Jack Spade to bypass a
hearing that would allow transparency and community involvement when this process already
led to the type of displacement that Measure G seeks to prevent. The same time that Fifth and
Pacific made contact with the zoning administrator about their subsidiary Jack Spade, the
landlord of the 3166 16th St location increased rent for the then-occupier Adobe Books by a
significant $3,500. Adobe Books, which has contributed to the cultural character of the Mission
for 25 years, was later pushed out when the landlord still refused to renew the lease after
community members raised more than $60,000 to keep the store in business.

Measure G was intended to protect the community voice from being overshadowed by large
corporate interests. Jack Spade has operated in bad faith by using store count technicalities to
evade fair and transparent public processes. I urge you to grant VCMA’s request for a hearing on
the status of Jack Spade moving into the Mission District so that the community may voice their
opinions and concerns. Thank you for your consideration.

Sincerely,

Tom Ammiano

Assemblymember, AD 17

 

WED. OCTOBER 9: Hearing on Jack Spade Part III

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HEARING on JACK SPADE – PART III

WEDNESDAY, OCTOBER 9
5:00 PM
CITY HALL, ROOM 416

Background: http://bit.ly/jackspadesf

The Board of Appeals, on August 21st, voted 3-2 in favor of revoking Jack Spade’s building permits. But because procedural rules require four votes, the appeal fell short.

See: http://www.sfgate.com/bayarea/article/Jack-Spade-keeps-permits-in-odd-play-by-Board-of-4758851.php

We’re not stopping. We have one final shot–to request that the case be reheard, which we can do if together we convince the board that allowing Jack Spade to move in would be “manifest injustice.”

Our argument: http://www.scribd.com/doc/167780173/VCMA-Rehearing-Brief-9-3-13-FINAL

In the previous hearing, one Commissioner reasoned that separating Kate Spade and Jack Spade would be to “throw common sense out the door.” We need this

We need the community out in full force to help convince the entire board that they should honor the intent of the law, and require Jack Spade to submit to a public approval process.

Tonight! Community Discussion at 518 Valencia

Tonight, we’re hosting a forum at 518 Valencia, Jack Spade, Gentrification, and the Mission: A Community Discussion for Action.

Community organizations, neighbors, and merchants are gathering to discuss and address Jack Spade and the ongoing crisis of rising rents and mass displacement of long-existing businesses and residents of the Mission District.

1234039_10151578955401863_1339965694_nWHO: Moderated by Rose Aguilar, host of Your Call, KALW Radio
Participating organizations include: Valencia Corridor Merchants Association, Calle 24 SF (formerly Lower 24th Street Merchants), PODER, Mission Economic Development Agency, Mission Neighborhood Resource Center, Shaping San Francisco, Center for Political Education, Eviction Free San Francisco, Encantada Gallery, No Jack Spade in the Mission.

WHEN: Monday, September 23, 2013 at 6pm

WHERE: 518 Valencia Street (near 16th), San Francisco

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The New Yorker highlights Jack Spade’s ‘disorienting’ effect

Photograph by Ed Darack/Science Faction/Corbis.

Photograph by Ed Darack/Science Faction/Corbis. Courtesy of newyorker.com.

The New Yorker shines a spotlight on the campaign to stop Jack Spade, calling it indicative of the “tense tug-of-war over wealth as the city undergoes a disorienting pro-business boom.”

Writer Lauren Smiley cuts to the core:

“Our claim to fame, in San Francisco, has always been our unique neighborhoods,” said Kathleen Dooley, who serves on the city’s small-

business commission, and has been a part of discussions on pending legislation. “There’s a very valid worry that it could become very homogenous, as we’ve seen in Manhattan.”

Head over to newyorker.com for more.

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