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In a hearing at City Hall Wednesday lasting nearly two hours, the Board of Appeals failed to get the necessary four votes to overturn  Jack Spade’s building permits for its proposed location on 16th Street.

This decision means that Jack Spade can renew construction which was halted last month when the Valencia Corridor Merchants Association first filed the appeal.

Though three members of the five-member board voted to grant the appeal to the Valencia merchants, four votes are required to rescind Jack Spade’s building permits.

In favor of granting the appeal, president Chris Hwang was joined by commissioners Darryl Honda and Arcelia Hurtado. Vice-president Ann Lazarus and commissioner Frank Fung opposed the appeal.

“I’m very disappointed,” said Kyle Smeallie a volunteer with the campaign opposing Jack Spade. “What we saw today was bureaucrats doing what bureaucrats do, hiding behind technicalities to further injustice.”

The main question of the evening centered around whether Jack Spade fit the Planning Code’s precise definition of formula retail, or chain store. If deemed a chain store the luxury men’s retailer would have had to face a conditional use hearing in which members of the community could voice their opinions to the Planning Commission.

The city defines a chain store as a retailer with 11 or more existing U.S. locations that have a similar look, feel, merchandise, design, among other attributes.

Jack Spade poses a particularly nuanced example when applying this definition. Its San Francisco location would be its 11th and the retailer is owned by a large parent company, kate spade, which shares some features of the brand.

Those opposed to Jack Spade say there’s no difference between it and kate spade, which  has more than 100 locations in the United States.  The carefully prepared argument presented by the merchants association vice president Jefferson McCarley and volunteer lawyer Alicia Gamez, cited similarities between the two retailers in merchandise, service mark, and general branding.

“Jack Spade clearly benefits from the association to the kate spade brand,” said McCarley. “When I say a ‘Spade is a Spade,’ it’s not just a pun, they benefit from a shared connection.”

Representatives from Jack Spade, including local paid consultant Phil Lesser and the company’s co-leader Melissa Xides, insisted that kate spade and Jack Spade share very little in common. Lesser spoke specifically about their different appearances and argued that the Jack Spade’s aesthetics wouldn’t damage the unique character of 16th Street.

“The spirit of the law is to keep a neighborhood unique based on visual factors,” said Lesser. “If you’re walking through the neighborhood you don’t see corporate structure.”

“We are a neighborhood retailer through and through, there is nothing formulaic about our stores,” said Xides. “We fell in love with the uniqueness of 16th Street…We fell in love with the food scene and gentrification that’s happening there.”

Zoning administrator Scott Sanchez, who first ruled that Jack Spade was not formula retail in a Letter of Determination issued September 2012, the most salient factor the city takes into account when defining a chain store is the number of U.S. locations. The city does not currently look at corporate ownership or international locations. In Sanchez’s estimation, kate and Jack Spade are different companies and the parent company’s numerous locations shouldn’t  be counted in determining Jack Spade’s status as formula retail.

For the divided Board, the issue was far from clearcut. Their arguments weighted the exact stipulations of the ordinance against the intent of voters when they first enacted the 2006 Proposition G on retail formula.

“Ultimately I do see Jack Spade as a component of one big parent company. Jack Spade and kate spade are one in the same,” said Board of Appeals president Chris Hwang. “Thinking about the intent of the law, this should have gone through a conditional use hearing… Community’s concerns need to be taken into account.”

Commissioner Arcelia Hurtado echoed Hwang’s comments.

“My hesitation [rejecting appeal] is it would make me throw common sense out the door. The spirit of the ordinance is to protect small businesses,” said Hurtado. “A conditional use hearing is the appropriate venue to have public discussion… It’s up to community who lives in the neighborhood.”

Commissioner Frank Fung opposed granting the appeal to the Valencia merchants based on the specific definitions of formula retail enumerated in the Planning Code.

“In this instance, if there is a specific code then people need to be able to rely on it,” Fung said, explaining that Jack Spade simply didn’t have enough stores for it to qualify as formula retail and shouldn’t be treated as such.

The Board of Appeals made its decision after nearly an hour of public comment from merchants, community members, and neighbors. Twenty two people spoke out against Jack’s Spade and seven spoke in favor of its arrival on 16th Street. Much of the testimony included impassioned pleas from merchants concerned about the homogenization of the Mission and the continued displacement of longtime residents and business owners.

“I’m very impressed by the gymnastics of Jack Spade saying it doesn’t violate the formula retail ordinance,” said Gabriel Medina policy manager for Mission Economic Development Agency. “There’s a huge epidemic of displacement, this Jack Spade would accelerate that.”

Several members of the Adobe Arts Cooperative, the bookstore and art space that existed in the proposed Jack Spade before having to move out when the rent increased, gave testimony opposed to the men’s luxury retailer.

“The community wanted us to stay, but because Jack Spade came along we had no choice,” said Jeff Ray a member of the Adobe Arts Collective. “To have this Park Avenue store plop down where Andrew was, is a desecration.”

Adobe’s owner Andrew McKinley implored the Board of Appeals to send this issue to a conditional use hearing. “You should consider a community, which is very upset,” he said.

Of the seven who spoke in favor of Jack Spade’s arrival, many discussed the often challenging environment of 16th Street, citing the prevalence of violence, drugs, and homelessness.

“I’ve really been on the fence about this issue, but I’ve seen decline on my street and sales are down,” said Sasha Wingate owner of Bell Jar. “I pick up human feces on a daily basis.”

Paul Stoll, owner of Body Manipulations, also voiced his support of Jack Spade due to his hope that it would clean up 16th Street.

“Valencia Street literally glitters. I want sparkly streets too,” he said.

Michael Katz, owner of Katz Bagels, doesn’t think Jack Spade will bring the changes that his neighboring merchants think it will.

“We have a lot of problems on our block, but Jack Spade is not going to fix them,” said Katz. “We as a community are in a dangerous position when we look to a multinational corporation to fix our block.”

Following the announcement of the decision, Jefferson McCarley explained that though the Valencia merchants can file another appeal within the next ten days he isn’t precisely sure what the group will do next.

“We’ll meet and talk about it,” McCarley said. “They’ll probably go back to work tomorrow.”

Regarding when Jack Spade will renew its renovations efforts or plan to open up its new shop, director of marketing Daniel Lahkman wouldn’t comment other than saying: “We’re just happy about tonight.”